S-1/A

As filed with the Securities and Exchange Commission on September 4, 2008

Registration No. 333-150164

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 3

to

Form S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

ENERJEX RESOURCES, INC.

(Exact name of registrant as specified in its charter)

Nevada	1311	88-0422242
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification No.)

7300 W. 110^th, 7^th Floor

Overland Park, Kansas 66210

(913) 693-4600

(Address, including zip code, and telephone number,

including area code, of registrant’s principal executive offices)

C. Stephen Cochennet

President and Chief Executive Officer

EnerJex Resources, Inc.

7300 W. 110^th, 7^th Floor

Overland Park, Kansas 66210

(913) 693-4600

(Name, address, including zip code, and telephone number,

including area code, of agent for service)

Copies to:

Jeffrey T. Haughey, Esq.
Husch Blackwell Sanders LLP
4801 Main Street, Suite 1000
Kansas City, Missouri 64112
(816) 983-8146 Michael A. Hedge, Esq.
Ryan C. Wilkins, Esq.
Stradling Yocca Carlson & Rauth
660 Newport Center Drive, Suite 1600
Newport Beach, California 92660
(949) 725-4000

Approximate date of commencement of proposed sale to the public:  As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.  o

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer o Non-accelerated filer o
(Do not check if a smaller reporting company) Smaller reporting company þ

CALCULATION OF REGISTRATION FEE

	Proposed Maximum	Amount of
	Aggregate	Registration
Title of Securities to be Registered	Offering Price(1)(2)	Fee
Common Stock ($0.001 par value	$34,500,000	$1,355.85(3)

(1)  In accordance with Rule 457(o) under the Securities Act of 1933, as amended, the number of shares being registered and the proposed maximum offering price per share are not included in this table.

(2)  Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended.

(3)  $1,100.40 previously transmitted via federal wire transfer.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED September 4, 2008

5,000,000 Shares

Common Stock

We are offering 5,000,000 shares of our common stock. Our common stock is included for quotation on the over-the-counter bulletin board (“OTC:BB”) under the symbol “ENRJ.” The closing price of our common stock on September 2, 2008 on the OTC:BB was $5.00. We have applied for listing of our common stock on the American Stock Exchange under the proposed symbol “JEX.”

This investment involves a high degree of risk. We urge you to carefully read the “Risk Factors” section beginning on page 10 of this prospectus.

	Per Share	Total
Public Offering Price	$	$
Underwriting Discount	$	$
Proceeds, Before Expenses, to EnerJex Resources, Inc.(1)	$	$

(1) The aggregate expenses of the offering are estimated to be $     , which represents $      per share.

We have granted the underwriters a 30-day option to purchase from us, at a price equal to the public offering price less the underwriting discount, up to an additional 15% of the total number of shares sold in this offering. In addition, the underwriters will receive warrants to purchase up to 5% of the total number of shares sold in this offering at an exercise price equal to 135% of the public offering price.

The underwriters expect to deliver the shares of common stock to investors on or about                    , 2008.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is          , 2008

PROPERTIES FOCUSED IN EASTERN KANSAS

MISSISSIPPI OIL RESERVOIR
NW Woodson County, Kansas

TABLE OF CONTENTS

SUMMARY	1
RISK FACTORS	10
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS	25
USE OF PROCEEDS	26
DIVIDEND POLICY	26
CAPITALIZATION	27
DILUTION	28
PRICE RANGE OF COMMON STOCK	29
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	30
BUSINESS AND PROPERTIES	43
MANAGEMENT	59
NON-EMPLOYEE DIRECTOR COMPENSATION	61
EXECUTIVE COMPENSATION	63
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS	67
PRINCIPAL STOCKHOLDERS	68
DESCRIPTION OF CAPITAL STOCK	70
MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES FOR NON-U.S. HOLDERS	73
UNDERWRITING	76
LEGAL MATTERS	79
EXPERTS	79
INDEPENDENT PETROLEUM ENGINEERS	79
WHERE YOU CAN FIND MORE INFORMATION	79
GLOSSARY	80
INDEX TO FINANCIAL STATEMENTS	F-1
EXHIBIT 1.1
EXHIBIT 5.1
EXHIBIT 21.1
EXHIBIT 23.1

You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not making offers to sell or seeking offers to buy these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information contained in this prospectus is accurate as of the date on the front of this prospectus only, regardless of the time of delivery of this prospectus or any sale of our common stock. Our business, financial condition, operating results and prospects may have changed since that date.

No action is being taken in any jurisdiction outside the United States to permit a public offering of the common stock or possession or distribution of this prospectus in that jurisdiction. Persons who come into possession of this prospectus in jurisdictions outside the United States are required to inform themselves about, and to observe any restrictions as to, this offering and the distribution of this prospectus applicable to those jurisdictions.

Industry and Market Data

The market data and certain other statistical information used throughout this prospectus are based on independent industry publications, government publications, reports by market research firms or other published independent sources. In addition, some data are based on our good faith estimates.

SUMMARY

The items in the following summary are described in more detail later in this prospectus. Because this section is a summary, it does not contain all the information that may be important to you or that you should consider before investing in our common stock. For a more complete understanding, you should carefully read the more detailed information set out in this prospectus, especially the risks of investing in our common stock that we discuss under the “Risk Factors” section, as well as the financial statements and the related notes to those statements included elsewhere in this prospectus.

All references in this prospectus to “we,” “us,” “our,” “company” and “EnerJex” refer to EnerJex Resources, Inc. and our wholly-owned operating subsidiaries, EnerJex Kansas, Inc. and DD Energy, Inc., unless the context requires otherwise. We report our financial information on the basis of a March 31 fiscal year end. We have provided definitions for the oil and natural gas industry terms used in this prospectus in the “Glossary” beginning on page 80 of this prospectus.

All information in this prospectus gives effect to a 1-for-5 reverse stock split of our outstanding shares of common stock effected on July 25, 2008. The reverse stock split did not affect our number of authorized shares or par value per share.

Our Business

EnerJex, formerly known as Millennium Plastics Corporation, is an oil and natural gas acquisition, exploration and development company. In August 2006, Millennium Plastics Corporation, following a reverse merger by and among us, Millennium Acquisition Sub (our wholly-owned subsidiary) and Midwest Energy, Inc., a Nevada corporation, or Midwest Energy, changed the focus of its business plan from the development of biodegradable plastic materials and entered into the oil and natural gas industry. In conjunction with the change, the company was renamed EnerJex Resources, Inc.

Our principal strategy is to focus on the acquisition of oil and natural gas mineral leases that have existing production and cash flow. Once acquired, we implement an accelerated development program utilizing capital resources, a regional operating focus, an experienced management and technical team, and enhanced recovery technologies to attempt to increase production and increase returns for our stockholders. Our oil and natural gas acquisition and development activities are currently focused in Eastern Kansas.

During fiscal 2008 and the first quarter of fiscal 2009, we deployed approximately $10.8 million in capital resources to acquire and develop five operating projects and drill 132 new wells (90 producing wells and 42 water injection wells). Our estimated total proved oil reserves increased from zero as of March 31, 2007 to 1.4 million barrels of oil equivalent, or BOE, as of March 31, 2008. Of the 1.4 million BOE of total proved reserves, approximately 64% are proved developed and approximately 36% are proved undeveloped. The proved developed reserves consist of 82% proved developed producing reserves and 18% proved developed non-producing reserves. Our gross production for the month of June 2008 was approximately 278 barrels of oil equivalent per day, or BOEPD. On August 26, 2008, our gross production was approximately 325 barrels of oil, or Barrels.

The total proved PV10 (present value) before tax of our reserves as of March 31, 2008 was $39.6 million. PV10 is a non-GAAP financial measure and generally differs from the standardized measure of discounted future net cash flows, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future net revenues. See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

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The following table sets forth a summary of our estimated proved reserves attributable to our properties as of March 31, 2008:

									PV10(5)
Proved Reserves Category	Gross STB(1)		Net STB(2)		Gross MCF(3)		Net MCF(4)		(before tax)
Proved, Developed Producing		1,034,163		746,169		141,371		114,610	$	22,750,447
Proved, Developed Non-Producing		141,900		115,071		350,000		286,587	$	5,446,999
Proved, Undeveloped		705,750		510,974		-0-		-0-	$	11,413,886
Total Proved		1,881,813		1,372,214		491,371		401,197	$	39,611,332

(1)	STB = one stock-tank barrel.
(2)	Net STB is based upon our net revenue interest.
(3)	MCF = thousand cubic feet of natural gas.
(4)	Net MCF is based upon our net revenue interest.

(5) See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

The Opportunity in Kansas

According to the Kansas Geological Survey, the State of Kansas has historically been one of the top 10 domestic oil producing regions in the United States. For the year ended December 31, 2007, 36.6 million barrels of oil were produced in Kansas. Of the total barrels produced in Kansas in 2007, 15 companies accounted for approximately 29% of this production, with the remaining 71% produced by over 2,400 independent operators.

In addition to significant historical oil and natural gas production levels in the region, we believe that a confluence of the following factors in Eastern Kansas and the surrounding region make it an attractive area for oil and natural gas development activities:

•  Traditional Roll-Up Strategy.  We are seeking to employ a traditional roll-up strategy utilizing a combination of capital resources, operational and management expertise, technology, and our strategic partnership with Haas Petroleum, which has experience operating in the region for nearly 70 years.

•  Numerous Acquisition Opportunities.  There are over 20,000 producing leases in the State of Kansas, which afford us numerous opportunities to pursue negotiated lease transactions instead of having to competitively bid on fundamentally sound assets.

•  Fragmented Ownership Structure.  There are numerous opportunities to acquire producing properties at attractive prices because of the currently inefficient and fragmented ownership structure.

Our Properties

•  Black Oaks Project.  The Black Oaks Project is currently a 2,400 acre project in Woodson and Greenwood Counties of Kansas where we are aggressively implementing a primary and secondary recovery waterflood program to increase oil production. We originally acquired an option to purchase and participate in the Black Oaks Project from MorMeg, LLC, or MorMeg, which is controlled by Mark Haas, a principal of Haas Petroleum, for $500,000 of cash and stock. In addition, we established a joint operating account with MorMeg and funded it with $4.0 million for the initial development of the project. We have a 95% working interest in the project and MorMeg has a 5% carried working interest in the project, which will convert to a 30% working interest upon payout. Our gross production for the month of June 2008 at Black Oaks was approximately 102 BOEPD. On August 26, 2008, gross production on this project was approximately 106 Barrels.

•  DD Energy Project.  In September 2007, we acquired a 100% working interest in seven oil and natural gas leases stretching across approximately 1,700 acres in Johnson, Anderson and Linn Counties of Kansas for $2.7 million. Our gross production for the month of June 2008 at DD Energy was

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approximately 57 BOEPD. On August 26, 2008, gross production on this project was approximately 92 Barrels.

•  Tri-County Project.  We hold a nearly 100% working interest in, and are the operator of, approximately 1,300 acres of oil and natural gas leases in Miami, Johnson and Franklin Counties of Kansas that make up the Tri-County Project. We completed this purchase in September 2007 for $800,000 in cash. Our gross production for the month of June 2008 at Tri-County was approximately 65 BOEPD. On August 26, 2008, gross production on this project was approximately 62 Barrels.

•  Thoren Project.  We acquired the Thoren Project from MorMeg in April 2007 for $400,000. The lease currently encompasses approximately 747 acres in Douglas County, Kansas. We hold a 100% working interest in the Thoren Project. Our gross production for the month of June 2008 at Thoren was approximately 37 BOEPD. On August 26, 2008, gross production on this project was approximately 48 Barrels.

•  Gas City Project.  The Gas City Project, currently located on approximately 7,470 acres in Allen County, Kansas, was acquired for $750,000 in February of 2006 and was our first property acquisition. In August 2007, we entered into a Development Agreement with Euramerica Energy, Inc., or Euramerica, whereby Euramerica initially invested $524,000 in capital toward 6,600 acres of the project. Euramerica was granted an option to purchase this 6,600 acre portion of the project for $1.2 million with a requirement to invest an additional $2.0 million for project development by August 31, 2008. We are the operator of the project at a cost plus 17.5% basis. To date, Euramerica has paid $600,000 of the $1.2 million purchase price and $500,000 of the $2.0 million development funds. Upon payment of the entire purchase price, Euramerica will be assigned a 95% working interest, and we will retain a 5% carried working interest before payout. When the project reaches payout, our 5% carried working interest will increase to a 25% working interest and Euramerica will have a 75% working interest. Payout for this project occurs when proceeds of all revenue received by Euramerica from the production and sale of oil, gas, or other hydrocarbons equals the project’s total expenses. If Euramerica does not fund the remaining $1.5 million of the development funds before August 31, 2008 or does not pay its third quarterly purchase price payment of $300,000 by September 1, 2008, or its fourth quarterly purchase price payment of $300,000 by December 1, 2008, each subject to a 15 day grace period, all of the development agreements will be terminated. We would have to pay Euramerica 90% of the net revenue interest from the Euramerica wells until the development funds and purchase price payments are fully repaid solely from the net revenue interest generated by the Euramerica wells. Following repayment, Euramerica would not have any interest in this property or the Euramerica wells. Our gross production for the month of June 2008 at Gas City was approximately 17 BOEPD. On August 26, 2008, gross production on this project was approximately 17 Barrels.

•  Nickel Town Project.  The option granted to us in connection with the Black Oaks Project would allow us to participate in another approximately 2,100 acre development and secondary recovery project with MorMeg, in the same area as the Black Oaks Project. Should we elect to participate in the Nickel Town Project, which requires us to complete development of the Black Oaks Project, we will have the option of negotiating new operating agreements with MorMeg.

Our Business Strategy

Our goal is to increase stockholder value by finding and developing oil and natural gas reserves at costs that provide an attractive rate of return on our investments. The principal elements of our business strategy are:

•  Develop Our Existing Properties.  We intend to create near-term reserve and production growth from over 400 additional drilling locations we have identified on our properties. We have identified an additional 193 drillable producer locations and 213 drillable injector locations. The structure and the continuous oil accumulation in Eastern Kansas, and the expected long-life production and reserves of our properties, are anticipated to enhance our opportunities for long-term profitability. As of

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March 31, 2008, our Black Oaks, DD Energy, Tri-County and Thoren Projects have projected lives of 47 years, 33 years, 21 years and 26 years, respectively.

•  Maximize Operational Control.  We seek to operate our properties and maintain a substantial working interest. We believe the ability to control our drilling inventory will provide us with the opportunity to more efficiently allocate capital, manage resources, control operating and development costs, and utilize our experience and knowledge of oilfield technologies.

•  Pursue Selective Acquisitions and Joint Ventures.  Due to our local presence in Eastern Kansas and strategic partnership with Haas Petroleum, we believe we are well-positioned to pursue selected acquisitions from the fragmented and capital-constrained owners of mineral rights throughout Eastern Kansas.

•  Reduce Unit Costs Through Economies of Scale and Efficient Operations.  As we continue to increase our oil production and develop our existing properties, we expect that our unit cost structure will benefit from economies of scale. In particular, we anticipate reducing unit costs by greater utilization of our existing infrastructure over a larger number of wells.

Our Competitive Strengths

We have a number of strengths that we believe will help us successfully execute our strategy:

•  Acquisition and Development Strategy.  We have what we believe to be a relatively low-risk, acquisition and development strategy compared to some of our competitors. We generally buy properties that have proven, long-term production, with a projected pay-back within a relatively short period of time, and with potential growth and upside in terms of development, enhancement and efficiency. We also plan to minimize the risk of natural gas and oil price volatility by developing a sales portfolio of pricing for our production as we continue to expand and as market conditions permit.

•  Significant Production Growth Opportunities.  We have acquired an attractive acreage position with favorable lease terms in a region with historical hydrocarbon production. Based on continued drilling success within our acreage position, we expect to increase our reserves, production and cash flow.

•  Experienced Management Team and Strategic Partner with Strong Technical Capability.  Our CEO has over 20 years of experience in the energy industry, primarily related to gas/electric utilities, but including experience related to energy trading and production, and members of our board of directors have considerable industry experience and technical expertise in engineering, horizontal drilling, geoscience and field operations. In addition, our strategic partner, Haas Petroleum, has over 70 years of experience in Eastern Kansas, including completion and secondary recovery techniques and technologies. Our board of directors and Mark Haas of Haas Petroleum work closely with management during the initial phases of any major project to ensure its feasibility and to consider the appropriate recovery techniques to be utilized.

•  Incentivized Management Ownership.  The equity ownership of our directors and executive officers is strongly aligned with that of our stockholders. As of September 2, 2008, our directors and executive officers owned approximately 9.1% of our outstanding common stock, with options that upon exercise would increase their ownership of our outstanding common stock to 18.8%. In addition, the compensation arrangements for our directors and executive officers are weighted toward future performance-based equity awards rather than cash payments.

Company History

Prior to the reverse merger with Midwest Energy in August of 2006, we operated under the name Millennium Plastics Corporation and focused on the development of biodegradable plastic materials. This business plan was ultimately abandoned following its unsuccessful implementation. Following the merger, we assumed the business plan of Midwest Energy and entered into the oil and natural gas industry. Concurrent with the effectiveness of the merger, we changed our name to “EnerJex Resources, Inc.” The result of the merger was that the former stockholders of Midwest Energy controlled approximately 98% of our outstanding shares of common stock. In addition, Midwest Energy was deemed to be the acquiring company for financial reporting purposes and the merger was accounted for as a reverse merger.

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Initially, all of our oil and natural gas operations were conducted through Midwest Energy. In November 2007, Midwest Energy changed its name to EnerJex Kansas, Inc., or EnerJex Kansas. In August 2007, we incorporated DD Energy, Inc., or DD Energy, as a wholly-owned operating subsidiary. All of our current operations are conducted through EnerJex Kansas and DD Energy, our wholly-owned subsidiaries.

Risks Associated with Our Business

Our business is subject to numerous risks, as discussed more fully in the section entitled “Risk Factors” beginning on page 10 of this prospectus. Some of these risks include:

•  Volatility in natural gas and oil prices, which could negatively impact our revenues and our ability to cover our operating or capital expenditures.

•  The speculative nature of drilling wells, which often involves significant costs that may be more than our estimates, and may not result in any addition to our production or reserves.

•  The concentration of our properties in Eastern Kansas, which disproportionately exposes us to adverse events occurring in this geographic area.

•  Our ability to achieve and maintain profitable business operations. Although we recently achieved positive income from operations for the first time in our history, we have a history of losses since our inception and we may never be able to maintain profitability.

•  Our ability to obtain additional capital in the future to finance our planned growth, which we may not be able to raise or may only be available on terms unfavorable to us or our stockholders.

•  Our ability to effectively compete with large companies that may have greater resources than us.

•  Our ability to accurately estimate proven recoverable reserves.

•  Our ability to successfully complete future acquisitions and to integrate acquired businesses.

•  Our ability to comply with complex laws and regulations, including environmental regulations, which can adversely affect the cost, manner or feasibility of doing business.

Recent Developments

A number of recent developments have occurred which may significantly impact our business prospects and results. Some of the developments that we believe to be most important to our business are summarized below. However, you are encouraged to read the more thorough description of these and other recent developments in the “Business and Properties” section beginning on page 43 of this prospectus.

•  As of March 31, 2008, our estimated total proved reserves were 1.4 million BOE with a total proved PV10, before tax, of reserves of $39.6 million. See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

•  On March 6, 2008, we entered into an agreement with Shell Trading (US) Company, or Shell, whereby we agreed to an 18-month fixed-price swap with Shell for 130 barrels of oil per day, or BOPD beginning on April 1, 2008, at a fixed price per barrel of $96.90, less transportation costs. This represented approximately 60% of our total current oil production on a net revenue basis at that time and locked in approximately $6.8 million in gross revenue before the deduction of transportation costs over the 18 month period. In addition, we agreed to sell all of our remaining oil production at current spot market pricing beginning April 1, 2008 through September 30, 2009 to Shell.

•  Our in-fill drilling and waterflood enhanced recovery techniques at the Black Oaks Project have increased gross production to approximately 106 Barrels on August 26, 2008 from a level of an average of approximately 32 BOEPD when the project was originally acquired. On June 30, 2008, the Black Oaks Project had 63 active production wells and 13 active water injection wells, an increase of 28  production wells and 13 water injection wells since the project was originally acquired. Based upon these results, we anticipate commencing Phase II of the development plan, which contemplates drilling over 25 additional water injection wells and completing over 20 additional producer wells.

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•  In June 2008, we received our second payment of $300,000 from Euramerica related to its option exercise for the Gas City Project. To date, Euramerica has paid $600,000 of the $1.2 million purchase price and $500,000 of the $2.0 million development funds. Upon payment of the entire purchase price, Euramerica will be assigned a 95% working interest and we will retain a 5% carried working interest before payout. When the project reaches payout, our 5% carried working interest will increase to a 25% working interest and Euramerica will have a 75% working interest.

•  For the three months ended June 30, 2008, oil and natural gas revenues were $1.69 million. We achieved positive income from operations of $24,710 for the quarter for the first time in our history. Cash flow from operations for the quarter totaled $351,045. The net loss for the quarter was $631,800 and included non-cash charges for stock-based compensation, depletion, accretion and certain loan costs totaling $831,286.

•  On July 3, 2008, we entered a new three-year $50 million senior secured credit facility with Texas Capital Bank, N. A. with an initial borrowing base of $10.75 million based on our current proved oil and natural gas reserves. We used our initial borrowing under this facility of $10.75 million to redeem an aggregate principal amount of $6.3 million of our 10% debentures, assign approximately $2.0 million of our existing indebtedness with another bank to this facility, repay $965,000 of seller-financed notes, pay the transaction costs, fees and expenses of this new facility, and expand current development projects, including completion of newly drilled wells.

•  As of July 3, 2008, we entered into an ISDA master agreement and a costless collar with BP Corporation North America Inc. for 130 barrels of oil per day with a price floor of $132.50 per barrel and a price ceiling of $155.70 per barrel for NYMEX West Texas Intermediate for the period of October 1, 2009 until March 31, 2011.

•  On July 7, 2008, we amended the $2.7 million of aggregate principal amount of our 10% debentures that remain outstanding to permit the indebtedness under our new credit facility, subordinate the security interests of the debentures to the new credit facility, provide for the redemption of the remaining debentures with the net proceeds from our next debt or equity offering, and eliminate the covenant to maintain certain production thresholds.

•  On August 1, 2008, we executed three-year employment agreements with C. Stephen Cochennet, our president and chief executive officer, and Dierdre P. Jones, our chief financial officer.

•  On August 26, 2008, our gross production was approximately 325 Barrels, broken out for each of our projects approximately as follows: Black Oaks — 106 Barrels; DD Energy — 92 Barrels; Tri-County — 62 Barrels; Thoren — 48 Barrels; and Gas City — 17 Barrels.

Corporate Information

EnerJex Resources, Inc. is a Nevada corporation. Our principal executive office is located at 7300 W. 110th Street, 7th Floor, Overland Park, Kansas 66210, and our phone number is (913) 693-4600. We also maintain a website at www.enerjexresources.com. The information on our website is not incorporated by reference into this prospectus.

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The Offering

Common stock offered by us	5,000,000 shares
Common stock to be outstanding after this offering	9,443,467 shares
Public offering price	$      per share
Use of proceeds	We intend to use the net proceeds of this offering for the repayment of indebtedness, the continued development of our existing projects, acquisitions, capital expenditures, working capital and other general corporate purposes. See the more detailed description of our expected use of the proceeds from this offering under the heading “Use of Proceeds” on page 26 of this prospectus.
Current OTC:BB symbol	ENRJ
Proposed American Stock Exchange symbol	JEX
Dividend policy	We do not expect to pay dividends in the foreseeable future.
Risk factors	Investing in our common stock involves certain risks. See the risk factors described under the heading “Risk Factors” beginning on page 10 of this prospectus and the other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in shares of our common stock.

The number of shares of our common stock that will be outstanding after this offering is based on 4,443,467 shares of our common stock outstanding as of September 2, 2008, and excludes:

•  695,500 shares of our common stock issuable upon exercise of outstanding options under our existing 2000/2001 Stock Option Plan and EnerJex Resources, Inc. Stock Option Plan, at a weighted average exercise price of $6.30 per share;

•  2,500 shares issuable upon conversion of an unsecured $25,000, 6% convertible note due August 2, 2010, which is convertible into shares of our common stock at $10.00 per share;

•  75,000 shares of our common stock issuable upon the exercise of outstanding warrants, at an exercise price of $3.00 per share, that were issued to the placement agent in connection with the private placement of $9.0 million of debentures in April 2007; and

•  250,000 shares of our common stock issuable upon the exercise of warrants to be issued to the underwriters in connection with this offering at an exercise price equal to 135% of the offering price.

In addition, unless specifically stated otherwise, all information in this prospectus assumes no exercise of the underwriters’ overallotment option to purchase additional shares.

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SUMMARY FINANCIAL DATA

The following tables set forth a summary of the historical financial data of EnerJex Resources, Inc. for, and as of the end of, each of the periods indicated. The statements of operations, statements of cash flows and other financial data for the period from (i) inception (December 30, 2005) to March 31, 2006, (ii) the fiscal years ended March 31, 2007 and 2008, and (iii) our balance sheets as of March 31, 2006, March 31, 2007 and March 31, 2008 are derived from our audited financial statements included elsewhere in this prospectus. Our balance sheet as of June 30, 2008 and the statements of operations, statements of cash flows and other financial data for the three months ended June 30, 2008 and 2007 are derived from our unaudited financial statements included elsewhere in this prospectus. We have prepared the unaudited financial statements on the same basis as our audited financial statements and, in our opinion, have included all adjustments, which include only normal recurring adjustments, necessary to present fairly our financial position and results of our operations for each of the periods mentioned.

The inception date for the financial statements presented in this prospectus is that of EnerJex Kansas. As a result of a reverse merger between Millennium Plastics Corporation (now EnerJex Resources, Inc.) and EnerJex Kansas (formerly Midwest Energy), EnerJex Kansas was deemed to be the acquiring company for financial reporting purposes and the transaction has been accounted for as a reverse merger.

Our historical results are not necessarily indicative of the results to be expected for any future periods and the results for the three months ended June 30, 2008 should not be considered indicative of results expected for the full fiscal year. You should read the following financial information together with the information under “Management’s Discussion and Analysis of Results of Operations and Financial Condition” and our financial statements and related notes included elsewhere in this prospectus.

													From Inception
													(December 30,
	Three Months Ended						Year Ended			Year Ended			2005) through
	June 30						March 31,			March 31,			March 31,
	2008			2007			2008			2007			2006
	(Unaudited)			(Unaudited)			(Audited)			(Audited)			(Audited)
Statement of Operations:
Revenue
Oil and natural gas activities	$	1,690,086		$	146,203		$	3,602,798		$	90,800		$	2,142
Expenses
Direct costs		714,534			59,042			1,795,188			172,417			14,599
Repairs on oil and natural gas equipment		—			—			—			165,603			40,436
Depreciation, depletion and amortization		370,190			14,245			935,330			23,978			825
Professional fees		143,678			874,505			1,226,998			302,071			50,490
Salaries		217,487			1,122,190			1,703,099			288,016			—
Administrative expense		219,487			129,937			887,872			182,773			21,700
Impairment of oil and natural gas properties		—			—			—			273,959			468,081
Impairment of goodwill		—			—			—			677,000			—
Total expenses		1,665,376			2,199,919			6,548,487			2,085,817			596,131
Net operating income (loss)		24,710			(2,053,716	)		(2,945,689	)		(1,995,017	)		(593,989	)
Other income (expense):
Interest expense		(274,386	)		(69,742	)		(1,882,246	)		(8,434	)		(38	)
Other		(382,124	)		(2,336,597	)		—			348			1,159
Total other income (expense)		(656,510	)		(2,406,339	)		(1,882,246	)		(8,086	)		1,121
Net (loss)		(631,800	)		(4,460,055	)	$	(4,827,935	)	$	(2,003,103	)	$	(592,868	)

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													From Inception
													(December 30,
	Three Months Ended						Year Ended			Year Ended			2005) through
	June 30						March 31,			March 31,			March 31,
	2008			2007			2008			2007			2006
	(Unaudited)			(Unaudited)			(Audited)			(Audited)			(Audited)
Weighted average number of common shares outstanding — basic and fully diluted		4,471,754			3,832,702			4,284,143			2,448,318			1,712,609
Net (loss) per share — basic and fully diluted	$	(0.14	)	$	(1.16	)	$	(1.13	)	$	(0.82	)	$	(0.35	)

													From Inception
													(12/30/05)
	Three Months Ended						Year Ended			Year Ended			through
	June 30						March 31,			March 31,			March 31,
	2008			2007			2008			2007			2006
	(Unaudited)			(Unaudited)			(Audited)			(Audited)			(Audited)
Statements of Cash Flows:
Cash provided by (used in) operating activities	$	351,045		$	(379,330	)	$	(408,494	)	$	(1,435,559	)	$	(60,786	)
Cash used in investing activities		(707,563	)		(1,600,442	)		(9,357,020	)		(151,180	)		(767,550	)
Cash provided by financing activities		449,875			8,020,022			10,617,025			1,095,800			1,418,768
Increase (decrease) in cash and cash equivalents		93,357			6,040,250			851,511			(490,939	)		590,432
Cash and cash equivalents, beginning		951,004			99,493			99,493			590,432			—
Cash and cash equivalents, end	$	1,044,361		$	6,139,743		$	951,004		$	99,493		$	590,432
Supplemental disclosures:
Interest paid	$	39,073		$	75,935		$	733,972		$	5,407		$	38
Income tax paid	$	—		$	—		$	—		$	—		$	—
Non-cash transactions:
Share-based payments issued for services	$	—		$	2,018,655		$	280,591		$	558,000		$	33,000
Share-based payments issued for oil and gas properties		—			—			—			200,000			—

	At
	June 30, 2008		At		At		At			At
	Pro Forma		June 30,		March 31,		March 31,			March 31,
	As Adjusted(1)		2008		2008		2007			2006
			(Unaudited)		(Audited)		(Audited)			(Audited)
Total Assets	$	34,590,027	$	12,340,027	$	10,867,829	$	492,507		$	922,486
Total Liabilities		11,481,284		11,481,284		9,433,837		537,097			71,586
Stockholders’ Equity (deficit)	$	23,108,743	$	858,743	$	1,433,992	$	(44,590	)	$	850,900

(1) The pro forma as adjusted column gives effect to the sale of shares of our common stock in this offering at an assumed public offering price of $5.00 per share, based on the closing price of our common stock as set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering costs payable by us.

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RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the following risk factors, as well as the other information in this prospectus, before deciding whether to invest in shares of our common stock. If any of the following risks actually occur, our business, financial condition, operating results and prospects would suffer. In that case, the trading price of our common stock would likely decline and you might lose all or part of your investment in our common stock. The risks described below are not the only ones we face. Additional risks that we currently do not know about or that we currently believe to be immaterial may also impair our operations and business results.

Risks Associated with Our Business

We have sustained losses, which raises doubt as to our ability to successfully develop profitable business operations.

Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered in establishing and maintaining a business in the oil and natural gas industries. There is nothing conclusive at this time on which to base an assumption that our business operations will prove to be successful or that we will be able to operate profitably. Our future operating results will depend on many factors, including:

•  the future prices of natural gas and oil;

•  our ability to raise adequate working capital;

•  success of our development and exploration efforts;

•  demand for natural gas and oil;

•  the level of our competition;

•  our ability to attract and maintain key management, employees and operators;

•  transportation and processing fees on our facilities;

•  fuel conservation measures;

•  alternate fuel requirements;

•  government regulation and taxation;

•  technical advances in fuel economy and energy generation devices; and

•  our ability to efficiently explore, develop and produce sufficient quantities of marketable natural gas or oil in a highly competitive and speculative environment while maintaining quality and controlling costs.

To achieve profitable operations, we must, alone or with others, successfully execute on the factors stated above, along with continually developing ways to enhance our production efforts. Despite our best efforts, we may not be successful in our development efforts or obtain required regulatory approvals. There is a possibility that some of our wells may never produce natural gas or oil in sustainable or economic quantities.

Natural gas and oil prices are volatile. This volatility may occur in the future, causing negative change in cash flows which may result in our inability to cover our operating or capital expenditures.

Our future revenues, profitability, future growth and the carrying value of our properties is anticipated to depend substantially on the prices we may realize for our natural gas and oil production. Our realized prices may also affect the amount of cash flow available for operating or capital expenditures and our ability to borrow and raise additional capital.

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Natural gas and oil prices are subject to wide fluctuations in response to relatively minor changes in or perceptions regarding supply and demand. Historically, the markets for natural gas and oil have been volatile, and they are likely to continue to be volatile in the future. Among the factors that can cause this volatility are:

•  worldwide or regional demand for energy, which is affected by economic conditions;

•  the domestic and foreign supply of natural gas and oil;

•  weather conditions;

•  natural disasters;

•  acts of terrorism;

•  domestic and foreign governmental regulations and taxation;

•  political and economic conditions in oil and natural gas producing countries, including those in the Middle East and South America;

•  impact of the U.S. dollar exchange rates on oil and natural gas prices;

•  the availability of refining capacity;

•  actions of the Organization of Petroleum Exporting Countries, or OPEC, and other state controlled oil companies relating to oil price and production controls; and

•  the price and availability of other fuels.

It is impossible to predict natural gas and oil price movements with certainty. Lower natural gas and oil prices may not only decrease our future revenues on a per unit basis but also may reduce the amount of natural gas and oil that we can produce economically. A substantial or extended decline in natural gas and oil prices may materially and adversely affect our future business enough to force us to cease our business operations. In addition, our reserves, financial condition, results of operations, liquidity and ability to finance and execute planned capital expenditures will also suffer in such a price decline. Further, natural gas and oil prices do not necessarily move together.

Approximately 54% of our total proved reserves as of March 31, 2008 consist of undeveloped and developed non-producing reserves, and those reserves may not ultimately be developed or produced.

As of March 31, 2008, approximately 36% of our total proved reserves were undeveloped and approximately 18% were developed non-producing. We plan to develop and produce all of our proved reserves, but ultimately some of these reserves may not be developed or produced. Furthermore, not all of our undeveloped or developed non-producing reserves may be ultimately produced in the time periods we have planned, at the costs we have budgeted, or at all.

Because we face uncertainties in estimating proven recoverable reserves, you should not place undue reliance on such reserve information.

Our reserve estimates and the future net cash flows attributable to those reserves are prepared by McCune Engineering, our independent petroleum and geological engineer. There are numerous uncertainties inherent in estimating quantities of proved reserves and cash flows from such reserves, including factors beyond our control and the control of McCune Engineering. Reserve engineering is a subjective process of estimating underground accumulations of natural gas and oil that can be economically extracted, which cannot be measured in an exact manner. The accuracy of an estimate of quantities of reserves, or of cash flows attributable to these reserves, is a function of the available data, assumptions regarding future natural gas and oil prices, expenditures for future development and exploitation activities, and engineering and geological interpretation and judgment. Reserves and future cash flows may also be subject to material downward or upward revisions based upon production history, development and exploitation activities and natural gas and oil prices. Actual future production, revenue, taxes, development expenditures, operating expenses, quantities of recoverable reserves and value of cash flows from those reserves may vary significantly from the

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assumptions and estimates in our reserve reports. Any significant variance from these assumptions to actual figures could greatly affect our estimates of reserves, the economically recoverable quantities of natural gas and oil attributable to any particular group of properties, the classification of reserves based on risk of recovery, and estimates of the future net cash flows. In addition, reserve engineers may make different estimates of reserves and cash flows based on the same available data. The estimated quantities of proved reserves and the discounted present value of future net cash flows attributable to those reserves included in this report were prepared by McCune Engineering in accordance with rules of the Securities and Exchange Commission, or SEC, and are not intended to represent the fair market value of such reserves.

The present value of future net cash flows from our proved reserves is not necessarily the same as the current market value of our estimated reserves. We base the estimated discounted future net cash flows from our proved reserves on prices and costs. However, actual future net cash flows from our natural gas and oil properties also will be affected by factors such as:

•  Geological conditions;

•  Assumptions governing future oil and natural gas prices;

•  Amount and timing of actual production;

•  Availability of funds;

•  Future operating and development costs;

•  Actual prices we receive for natural gas and oil;

•  Supply and demand for our natural gas and oil;

•  Changes in government regulations and taxation; and

•  Capital costs of drilling new wells.

The timing of both our production and our incurrence of expenses in connection with the development and production of our properties will affect the timing of actual future net cash flows from proved reserves, and thus their actual present value. In addition, the 10% discount factor we use when calculating discounted future net cash flows may not be the most appropriate discount factor based on interest rates in effect from time to time and risks associated with our business or the natural gas and oil industry in general.

The SEC permits natural gas and oil companies, in their public filings, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. The SEC’s guidelines strictly prohibit us from including “probable reserves” and “possible reserves” in such filings. We also caution you that the SEC views such “probable” and “possible” reserve estimates as inherently unreliable and these estimates may be seen as misleading to investors unless the reader is an expert in the natural gas and oil industry. Unless you have such expertise, you should not place undue reliance on these estimates. Potential investors should also be aware that such “probable” and “possible” reserve estimates will not be contained in any “resale” or other registration statement filed by us that offers or sells shares on behalf of purchasers of our common stock and may have an impact on the valuation of the resale of the shares. Except as required by applicable law, we undertake no duty to update this information and do not intend to update this information.

The differential between the New York Mercantile Exchange, or NYMEX, or other benchmark price of oil and natural gas and the wellhead price we receive could have a material adverse effect on our results of operations, financial condition and cash flows.

The prices that we receive for our oil and natural gas production sometimes trade at a discount to the relevant benchmark prices, such as NYMEX, that are used for calculating hedge positions. The difference between the benchmark price and the price we receive is called a differential. We cannot accurately predict oil and natural gas differentials. In recent years for example, production increases from competing Canadian and Rocky Mountain producers, in conjunction with limited refining and pipeline capacity from the Rocky

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Mountain area, have gradually widened this differential. Increases in the differential between the benchmark price for oil and natural gas and the wellhead price we receive could have a material adverse effect on our results of operations, financial condition and cash flows by decreasing the proceeds we receive for our oil and natural gas production in comparison to what we would receive if not for the differential.

The natural gas and oil business involves numerous uncertainties and operating risks that can prevent us from realizing profits and can cause substantial losses.

Our development, exploitation and exploration activities may be unsuccessful for many reasons, including weather, cost overruns, equipment shortages and mechanical difficulties. Moreover, the successful drilling of a natural gas and oil well does not ensure a profit on investment. A variety of factors, both geological and market-related, can cause a well to become uneconomical or only marginally economical. In addition to their cost, unsuccessful wells can hurt our efforts to replace reserves.

The natural gas and oil business involves a variety of operating risks, including:

•  unexpected operational events and/or conditions;

•  unusual or unexpected geological formations;

•  reductions in natural gas and oil prices;

•  limitations in the market for oil and natural gas;

•  adverse weather conditions;

•  facility or equipment malfunctions;

•  title problems;

•  natural gas and oil quality issues;

•  pipe, casing, cement or pipeline failures;

•  natural disasters;

•  fires, explosions, blowouts, surface cratering, pollution and other risks or accidents;

•  environmental hazards, such as natural gas leaks, oil spills, pipeline ruptures and discharges of toxic gases;

•  compliance with environmental and other governmental requirements; and

•  uncontrollable flows of oil, natural gas or well fluids.

If we experience any of these problems, it could affect well bores, gathering systems and processing facilities, which could adversely affect our ability to conduct operations. We could also incur substantial losses as a result of:

•  injury or loss of life;

•  severe damage to and destruction of property, natural resources and equipment;

•  pollution and other environmental damage;

•  clean-up responsibilities;

•  regulatory investigation and penalties;

•  suspension of our operations; and

•  repairs to resume operations.

Because we use third-party drilling contractors to drill our wells, we may not realize the full benefit of worker compensation laws in dealing with their employees. Our insurance does not protect us against all

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operational risks. We do not carry business interruption insurance at levels that would provide enough funds for us to continue operating without access to other funds. For some risks, we may not obtain insurance if we believe the cost of available insurance is excessive relative to the risks presented. In addition, pollution and environmental risks generally are not fully insurable. If a significant accident or other event occurs and is not fully covered by insurance, it could impact our operations enough to force us to cease our operations.

Drilling wells is speculative, often involving significant costs that may be more than our estimates, and may not result in any addition to our production or reserves. Any material inaccuracies in drilling costs, estimates or underlying assumptions will materially affect our business.

Developing and exploring for natural gas and oil involves a high degree of operational and financial risk, which precludes definitive statements as to the time required and costs involved in reaching certain objectives. The budgeted costs of drilling, completing and operating wells are often exceeded and can increase significantly when drilling costs rise due to a tightening in the supply of various types of oilfield equipment and related services. Drilling may be unsuccessful for many reasons, including geological conditions, weather, cost overruns, equipment shortages and mechanical difficulties. Moreover, the successful drilling of a natural gas or oil well does not ensure a profit on investment. Exploratory wells bear a much greater risk of loss than development wells. However, approximately 83% of our wells drilled through June 30, 2008 have been development wells. A variety of factors, both geological and market-related, can cause a well to become uneconomical or only marginally economic. Our initial drilling and development sites, and any potential additional sites that may be developed, require significant additional exploration and development, regulatory approval and commitments of resources prior to commercial development. If our actual drilling and development costs are significantly more than our estimated costs, we may not be able to continue our business operations as proposed and would be forced to modify our plan of operation.

Development of our reserves, when established, may not occur as scheduled and the actual results may not be as anticipated. Drilling activity and access to capital may result in downward adjustments in reserves or higher than anticipated costs. Our estimates will be based on various assumptions, including assumptions over which we have control and assumptions required by the SEC relating to natural gas and oil prices, drilling and operating expenses, capital expenditures, taxes and availability of funds. We have control over our operations that affect, among other things, acquisitions and dispositions of properties, availability of funds, use of applicable technologies, hydrocarbon recovery efficiency, drainage volume and production decline rates that are part of these estimates and assumptions and any variance in our operations that affects these items within our control may have a material effect on reserves. The process of estimating our natural gas and oil reserves is anticipated to be extremely complex, and will require significant decisions and assumptions in the evaluation of available geological, geophysical, engineering and economic data for each reservoir. Our estimates may not be reliable enough to allow us to be successful in our intended business operations. Our actual production, revenues, taxes, development expenditures and operating expenses will likely vary from those anticipated. These variances may be material.

Unless we replace our oil and natural gas reserves, our reserves and production will decline, which would adversely affect our cash flows and income.

Unless we conduct successful development, exploitation and exploration activities or acquire properties containing proved reserves, our proved reserves will decline as those reserves are produced. Producing oil and natural gas reservoirs generally are characterized by declining production rates that vary depending upon reservoir characteristics and other factors. Our future oil and natural gas reserves and production, and, therefore our cash flow and income, are highly dependent on our success in efficiently developing and exploiting our current reserves and economically finding or acquiring additional recoverable reserves. We may be unable to make such acquisitions because we are:

•  unable to identify attractive acquisition candidates or negotiate acceptable purchase contracts with them;

•  unable to obtain financing for these acquisitions on economically acceptable terms; or

•  outbid by competitors.

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If we are unable to develop, exploit, find or acquire additional reserves to replace our current and future production, our cash flow and income will decline as production declines, until our existing properties would be incapable of sustaining commercial production.

A significant portion of our potential future reserves and our business plan depend upon secondary recovery techniques to establish production. There are significant risks associated with such techniques.

We anticipate that a significant portion of our future reserves and our business plan will be associated with secondary recovery projects that are either in the initial stage of implementation or are scheduled for implementation. We anticipate that secondary recovery will affect our reserves and our business plan, and the exact project initiation dates and, by the very nature of waterflood operations, the exact completion dates of such projects are uncertain. In addition, the reserves and our business plan associated with these secondary recovery projects, as with any reserves, are estimates only, as the success of any development project, including these waterflood projects, cannot be ascertained in advance. If we are not successful in developing a significant portion of our reserves associated with secondary recovery methods, then the project may be uneconomic or generate less cash flow and reserves than we had estimated prior to investing the capital. Risks associated with secondary recovery techniques include, but are not limited to, the following:

•  higher than projected operating costs;

•  lower-than-expected production;

•  longer response times;

•  higher costs associated with obtaining capital;

•  unusual or unexpected geological formations;

•  fluctuations in natural gas and oil prices;

•  regulatory changes;

•  shortages of equipment; and

•  lack of technical expertise.

If any of these risks occur, it could adversely affect our financial condition or results of operations.

Any acquisitions we complete are subject to considerable risk.

Even when we make acquisitions that we believe are good for our business, any acquisition involves potential risks, including, among other things:

•  the validity of our assumptions about reserves, future production, revenues and costs, including synergies;

•  an inability to integrate successfully the businesses we acquire;

•  a decrease in our liquidity by using our available cash or borrowing capacity to finance acquisitions;

•  a significant increase in our interest expense or financial leverage if we incur additional debt to finance acquisitions;

•  the assumption of unknown liabilities, losses or costs for which we are not indemnified or for which our indemnity is inadequate;

•  the diversion of management’s attention from other business concerns;

•  an inability to hire, train or retain qualified personnel to manage the acquired properties or assets;

•  the incurrence of other significant charges, such as impairment of goodwill or other intangible assets, asset devaluation or restructuring charges;

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•  unforeseen difficulties encountered in operating in new geographic or geological areas; and

•  customer or key employee losses at the acquired businesses.

Our decision to acquire a property will depend in part on the evaluation of data obtained from production reports and engineering studies, geophysical and geological analyses and seismic and other information, the results of which are often incomplete or inconclusive.

Our reviews of acquired properties can be inherently incomplete because it is not always feasible to perform an in-depth review of the individual properties involved in each acquisition. Even a detailed review of records and properties may not necessarily reveal existing or potential problems, nor will it permit a buyer to become sufficiently familiar with the properties to assess fully their deficiencies and potential. Inspections may not always be performed on every well, and environmental problems, such as ground water contamination, plugging or orphaned well liability are not necessarily observable even when an inspection is undertaken.

We must obtain governmental permits and approvals for drilling operations, which can result in delays in our operations, be a costly and time consuming process, and result in restrictions on our operations.

Regulatory authorities exercise considerable discretion in the timing and scope of permit issuances in the region in which we operate. Compliance with the requirements imposed by these authorities can be costly and time consuming and may result in delays in the commencement or continuation of our exploration or production operations and/or fines. Regulatory or legal actions in the future may materially interfere with our operations or otherwise have a material adverse effect on us. In addition, we are often required to prepare and present to federal, state or local authorities data pertaining to the effect or impact that a proposed project may have on the environment, threatened and endangered species, and cultural and archaeological artifacts. Accordingly, the permits we need may not be issued, or if issued, may not be issued in a timely fashion, or may involve requirements that restrict our ability to conduct our operations or to do so profitably.

Due to our lack of geographic diversification, adverse developments in our operating areas would materially affect our business.

We currently only lease and operate oil and natural gas properties located in Eastern Kansas. As a result of this concentration, we may be disproportionately exposed to the impact of delays or interruptions of production from these properties caused by significant governmental regulation, transportation capacity constraints, curtailment of production, natural disasters, adverse weather conditions or other events which impact this area.

We depend on a small number of customers for all, or a substantial amount of our sales. If these customers reduce the volumes of oil and natural gas they purchase from us, our revenue and cash available for distribution will decline to the extent we are not able to find new customers for our production.

We have contracted with Shell for the sale of all of our oil through September 2009 and will likely contract for the sale of our natural gas with one, or a small number, of buyers. It is not likely that there will be a large pool of available purchasers. If a key purchaser were to reduce the volume of oil or natural gas it purchases from us, our revenue and cash available for operations will decline to the extent we are not able to find new customers to purchase our production at equivalent prices.

We are not the operator of some of our properties and we have limited control over the activities on those properties.

We are not the operator on our Black Oaks Project. We have only limited ability to influence or control the operation or future development of the Black Oaks Project or the amount of capital expenditures that we can fund with respect to it. In the case of the Black Oaks Project, our dependence on the operator, Haas Petroleum, limits our ability to influence or control the operation or future development of the project. Such limitations could materially adversely affect the realization of our targeted returns on capital related to exploration, drilling or production activities and lead to unexpected future costs.

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We may suffer losses or incur liability for events for which we or the operator of a property have chosen not to obtain insurance.

Our operations are subject to hazards and risks inherent in producing and transporting natural gas and oil, such as fires, natural disasters, explosions, pipeline ruptures, spills, and acts of terrorism, all of which can result in the loss of hydrocarbons, environmental pollution, personal injury claims and other damage to our and others’ properties. As protection against operating hazards, we maintain insurance coverage against some, but not all, potential losses. In addition, pollution and environmental risks generally are not fully insurable. As a result of market conditions, existing insurance policies may not be renewed and other desirable insurance may not be available on commercially reasonable terms, if at all. The occurrence of an event that is not covered, or not fully covered, by insurance could have a material adverse effect on our business, financial condition and results of operations.

Our hedging activities could result in financial losses or could reduce our available funds or income and therefore adversely affect our financial position.

To achieve more predictable cash flow and to reduce our exposure to adverse fluctuations in the prices of oil and natural gas, we have entered into derivative arrangements from April 1, 2008 until March 31, 2011, for 130 barrels of oil per day that could result in both realized and unrealized hedging losses. As of June 30, 2008 we had not incurred any such losses. The extent of our commodity price exposure is related largely to the effectiveness and scope of our derivative activities. For example, the derivative instruments we may utilize may be based on posted market prices, which may differ significantly from the actual crude oil, natural gas and NGL prices we realize in our operations.

Our actual future production may be significantly higher or lower than we estimate at the time we enter into derivative transactions for such period. If the actual amount is higher than we estimate, we will have greater commodity price exposure than we intended. If the actual amount is lower than the nominal amount that is subject to our derivative financial instruments, we might be forced to satisfy all or a portion of our derivative transactions without the benefit of the cash flow from our sale or purchase of the underlying physical commodity, resulting in a substantial diminution of our liquidity. As a result of these factors, our derivative activities may not be as effective as we intend in reducing the volatility of our cash flows, and in certain circumstances may actually increase the volatility of our cash flows. In addition, our derivative activities are subject to the risks that a counterparty, such as Shell or BP, may not perform its obligation under the applicable derivative instrument. Moreover, unless we execute an intercreditor agreement with Shell or BP, there is a risk that we will be required to post collateral to secure our hedging activities and this could limit the funds available to us for our business activities. If oil exceeds $210 a barrel before an intercreditor agreement is in place, and we are unable to post the collateral, there is a risk that our hedged positions could be liquidated and we could incur significant losses.

Our business depends in part on gathering and transportation facilities owned by others. Any limitation in the availability of those facilities could interfere with our ability to market our oil and natural gas production and could harm our business.

The marketability of our oil and natural gas production will depend in a very large part on the availability, proximity and capacity of pipelines, oil and natural gas gathering systems and processing facilities. The amount of oil and natural gas that can be produced and sold is subject to curtailment in certain circumstances, such as pipeline interruptions due to scheduled and unscheduled maintenance, excessive pressure, physical damage or lack of available capacity on such systems. The curtailments arising from these and similar circumstances may last from a few days to several months. In many cases, we will be provided only with limited, if any, notice as to when these circumstances will arise and their duration. Any significant curtailment in gathering system or pipeline capacity could significantly reduce our ability to market our oil and natural gas production and harm our business.

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The high cost of drilling rigs, equipment, supplies, personnel and other services could adversely affect our ability to execute on a timely basis our development, exploitation and exploration plans within our budget.

Shortages or an increase in cost of drilling rigs, equipment, supplies or personnel could delay or interrupt our operations, which could impact our financial condition and results of operations. Drilling activity in the geographic areas in which we conduct drilling activities may increase, which would lead to increases in associated costs, including those related to drilling rigs, equipment, supplies and personnel and the services and products of other vendors to the industry. Increased drilling activity in these areas may also decrease the availability of rigs. Although Haas Petroleum has agreed to provide two drilling rigs to the Black Oaks Project, we do not have any contracts for drilling rigs and drilling rigs may not be readily available when we need them. Drilling and other costs may increase further and necessary equipment and services may not be available to us at economical prices.

Our exposure to possible leasehold defects and potential title failure could materially adversely impact our ability to conduct drilling operations.

We obtain the right and access to properties for drilling by obtaining oil and natural gas leases either directly from the hydrocarbon owner, or through a third party that owns the lease. The leases may be taken or assigned to us without title insurance. There is a risk of title failure with respect to such leases, and such title failures could materially adversely impact our business by causing us to be unable to access properties to conduct drilling operations.

Our reserves are subject to the risk of depletion because many of our leases are in mature fields that have produced large quantities of oil and natural gas to date.

Our operations are located in established fields in Eastern Kansas. As a result, many of our leases are in, or directly offset, areas that have produced large quantities of oil and natural gas to date. The degree of depletion for each of our projects, as detailed in “Business and Properties — Our Properties” by project, ranges from approximately 0 to 78%. As such, our reserves may be partially or completely depleted by offsetting wells or previously drilled wells, which could significantly harm our business.

Our lease ownership may be diluted due to financing strategies we may employ in the future due to our lack of capital.

To accelerate our development efforts we plan to take on working interest partners who will contribute to the costs of drilling and completion and then share in revenues derived from production. In addition, we may in the future, due to a lack of capital or other strategic reasons, establish joint venture partnerships or farm out all or part of our development efforts. These economic strategies may have a dilutive effect on our lease ownership and could significantly reduce our operating revenues.

We are subject to complex laws and regulations, including environmental regulations, which can adversely affect the cost, manner or feasibility of doing business.

Development, production and sale of natural gas and oil in the United States are subject to extensive laws and regulations, including environmental laws and regulations. We may be required to make large expenditures to comply with environmental and other governmental regulations. Matters subject to regulation include, but are not limited to:

•  location and density of wells;

•  the handling of drilling fluids and obtaining discharge permits for drilling operations;

•  accounting for and payment of royalties on production from state, federal and Indian lands;

•  bonds for ownership, development and production of natural gas and oil properties;

•  transportation of natural gas and oil by pipelines;

•  operation of wells and reports concerning operations; and

•  taxation.

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Under these laws and regulations, we could be liable for personal injuries, property damage, oil spills, discharge of hazardous materials, remediation and clean-up costs and other environmental damages. Failure to comply with these laws and regulations also may result in the suspension or termination of our operations and subject us to administrative, civil and criminal penalties. Moreover, these laws and regulations could change in ways that substantially increase our costs. Accordingly, any of these liabilities, penalties, suspensions, terminations or regulatory changes could materially adversely affect our financial condition and results of operations enough to possibly force us to cease our business operations.

Our operations may expose us to significant costs and liabilities with respect to environmental, operational safety and other matters.

We may incur significant costs and liabilities as a result of environmental and safety requirements applicable to our oil and natural gas exploration and production activities. We may also be exposed to the risk of costs associated with Kansas Corporation Commission requirements to plug orphaned and abandoned wells on our oil and natural gas leases from wells previously drilled by third parties. In addition, we may indemnify sellers or lessors of oil and natural gas properties for environmental liabilities they or their predecessors may have created. These costs and liabilities could arise under a wide range of federal, state and local environmental and safety laws and regulations, including regulations and enforcement policies, which have tended to become increasingly strict over time. Failure to comply with these laws and regulations may result in the assessment of administrative, civil and criminal penalties, imposition of cleanup and site restoration costs, liens and to a lesser extent, issuance of injunctions to limit or cease operations. In addition, claims for damages to persons or property may result from environmental and other impacts of our operations.

Strict, joint and several liability may be imposed under certain environmental laws, which could cause us to become liable for the conduct of others or for consequences of our own actions that were in compliance with all applicable laws at the time those actions were taken. New laws, regulations or enforcement policies could be more stringent and impose unforeseen liabilities or significantly increase compliance costs. If we are not able to recover the resulting costs through insurance or increased revenues, our ability to operate effectively could be adversely affected.

Our facilities and activities could be subject to regulation by the Federal Energy Regulatory Commission or the Department of Transportation, which could take actions that could result in a material adverse effect on our financial condition.

Although it is anticipated that our natural gas gathering systems will be exempt from FERC and DOT regulation, any revisions to this understanding may affect our rights, liabilities, and access to midstream or interstate natural gas transportation, which could have a material adverse effect on our operations and financial condition. In addition, the cost of compliance with any revisions to FERC or DOT rules, regulations or requirements could be substantial and could adversely affect our ability to operate in an economic manner. Additional FERC and DOT rules and legislation pertaining to matters that could affect our operations are considered and adopted from time to time. We cannot predict what effect, if any, such regulatory changes and legislation might have on our operations, but we could be required to incur additional capital expenditures and increased costs.

Although our natural gas sales activities are not currently projected to be subject to rate regulation by FERC, if FERC finds that in connection with making sales in the future, we (i) failed to comply with any applicable FERC administered statutes, rules, regulations or orders, (ii) engaged in certain fraudulent acts, or (iii) engaged in market manipulation, we could be subject to substantial penalties and fines of up to $1.0 million per day per violation.

We operate in a highly competitive environment and our competitors may have greater resources than us.

The natural gas and oil industry is intensely competitive and we compete with other companies, many of which are larger and have greater financial, technological, human and other resources. Many of these companies not only explore for and produce crude oil and natural gas but also carry on refining operations and market petroleum and other products on a regional, national or worldwide basis. Such companies may be able

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to pay more for productive natural gas and oil properties and exploratory prospects or define, evaluate, bid for and purchase a greater number of properties and prospects than our financial or human resources permit. In addition, such companies may have a greater ability to continue exploration activities during periods of low oil and natural gas market prices. Our ability to acquire additional properties and to discover reserves in the future will be dependent upon our ability to evaluate and select suitable properties and to consummate transactions in a highly competitive environment. If we are unable to compete, our operating results and financial position may be adversely affected.

We may incur substantial write-downs of the carrying value of our natural gas and oil properties, which would adversely impact our earnings.

We review the carrying value of our natural gas and oil properties under the full-cost accounting rules of the SEC on a quarterly basis. This quarterly review is referred to as a ceiling test. Under the ceiling test, capitalized costs, less accumulated amortization and related deferred income taxes, may not exceed an amount equal to the sum of the present value of estimated future net revenues (adjusted for cash flow hedges) less estimated future expenditures to be incurred in developing and producing the proved reserves, less any related income tax effects. In calculating future net revenues, current prices and costs used are those as of the end of the appropriate quarterly period. Such prices are utilized except where different prices are fixed and determinable from applicable contracts for the remaining term of those contracts, including the effects of derivatives qualifying as cash flow hedges. Two primary factors impacting this test are reserve levels and current prices, and their associated impact on the present value of estimated future net revenues. Revisions to estimates of natural gas and oil reserves and/or an increase or decrease in prices can have a material impact on the present value of estimated future net revenues. Any excess of the net book value, less deferred income taxes, is generally written off as an expense. Under SEC regulations, the excess above the ceiling is not expensed (or is reduced) if, subsequent to the end of the period, but prior to the release of the financial statements, natural gas and oil prices increase sufficiently such that an excess above the ceiling would have been eliminated (or reduced) if the increased prices were used in the calculations.

We have recorded a total of $742,040 in impairments on our oil and natural gas properties based on the ceiling test under the full-cost method in the years ended March 31, 2007 and 2006. There was no impairment in the fiscal year ended March 31, 2008 or in the three months ended June 30, 2008.

We will need additional capital in the future to finance our planned growth, which we may not be able to raise or may only be available on terms unfavorable to us or our stockholders, which may result in our inability to fund our working capital requirements and harm our operational results.

We have and expect to continue to have substantial capital expenditure and working capital needs. We will need to rely on cash flow from operations and borrowings under our credit facility or raise additional cash to fund our operations, pay outstanding long-term debt, fund our anticipated reserve replacement needs and implement our growth strategy, or respond to competitive pressures and/or perceived opportunities, such as investment, acquisition, exploration, workover and development activities.

If low natural gas and oil prices, operating difficulties or other factors, many of which are beyond our control, cause our revenues or cash flows from operations to decrease, we may be limited in our ability to spend the capital necessary to complete our development, production exploitation and exploration programs. If our resources or cash flows do not satisfy our operational needs, we will require additional financing, in addition to anticipated cash generated from our operations, to fund our planned growth. Additional financing might not be available on terms favorable to us, or at all. If adequate funds were not available or were not available on acceptable terms, our ability to fund our operations, take advantage of unanticipated opportunities, develop or enhance our business or otherwise respond to competitive pressures would be significantly limited. In such a capital restricted situation, we may curtail our acquisition, drilling, development, and exploration activities or be forced to sell some of our assets on an untimely or unfavorable basis.

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If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our stockholders would be reduced, and these newly issued securities might have rights, preferences or privileges senior to those of existing stockholders.

Our success depends on our key management and professional personnel, including C. Stephen Cochennet, the loss of whom would harm our ability to execute our business plan.

Our success depends heavily upon the continued contributions of C. Stephen Cochennet, whose knowledge, leadership and technical expertise would be difficult to replace, and on our ability to retain and attract experienced engineers, geoscientists and other technical and professional staff. Although Mr. Cochennet is subject to an employment agreement with us and we maintain $1.0 million in key person insurance on Mr. Cochennet, if we were to lose his services, our ability to execute our business plan would be harmed and we may be forced to significantly alter our operations until such time as we could hire a suitable replacement for Mr. Cochennet.

Risks Associated with our Debt Financing

The covenants in our new credit facility impose significant operating and financial restrictions on us.

The new credit facility imposes significant operating and financial restrictions on us. These restrictions limit our ability and the ability of our subsidiaries, among other things, to:

•  incur additional indebtedness and provide additional guarantees;

•  pay dividends and make other restricted payments;

•  create or permit certain liens;

•  use the proceeds from the sales of our oil and natural gas properties;

•  engage in certain transactions with affiliates; and

•  consolidate, merge, sell or transfer all or substantially all of our assets or the assets of our subsidiaries.

The new credit facility also contains various affirmative covenants with which we are required to comply. Although we currently expect to comply with these covenants, we may be unable to comply with some or all of them in the future. If we do not comply with these covenants and are unable to obtain waivers from our lenders, we would be unable to make additional borrowings under this facility, our indebtedness under this facility would be in default and could be accelerated by our lenders. In addition, it could cause a cross-default under our other indebtedness. If our indebtedness is accelerated, we may not be able to repay our indebtedness or borrow sufficient funds to refinance it. In addition, if we incur additional indebtedness in the future, we may be subject to additional covenants, which may be more restrictive than those to which we are currently subject.

Risks Associated with our Common Stock and the Offering

Our common stock is traded on an illiquid market, making it difficult for investors to sell their shares.

Our common stock trades on the Over-the-Counter Bulletin Board under the symbol “ENRJ,” but trading has been minimal. The trading volume for our common stock has been very limited. The trading price of our common stock could be subject to wide fluctuations. Investors may not be able to purchase additional shares or sell their shares within the time frame or at a price they desire. Although we expect our common stock to be listed on AMEX, we may not be able to obtain a listing for our common stock on AMEX or an active trading market may not develop, or be sustained after this offering. The public offering price of our common stock may not be indicative of the market price of our common stock after this offering.

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The price of our common stock may be volatile and you may not be able to resell your shares at a favorable price.

Regardless of whether an active trading market for our common stock develops, the market price of our common stock may be volatile after this offering and may decline below the public offering price. You may not be able to resell your shares at or above the price you paid for such shares. The following factors could affect our stock price:

•  our operating and financial performance and prospects;

•  quarterly variations in the rate of growth of our financial indicators, such as net income per share, net income and revenues;

•  changes in revenue or earnings estimates or publication of research reports by analysts about us or the exploration and production industry;

•  potentially limited liquidity;

•  actual or anticipated variations in our reserve estimates and quarterly operating results;

•  changes in natural gas and oil prices;

•  sales of our common stock by significant stockholders and future issuances of our common stock;

•  increases in our cost of capital;

•  changes in applicable laws or regulations, court rulings and enforcement and legal actions;

•  commencement of or involvement in litigation;

•  changes in market valuations of similar companies;

•  additions or departures of key management personnel;

•  general market conditions, including fluctuations in and the occurrence of events or trends affecting the price of natural gas and oil; and

•  domestic and international economic, legal and regulatory factors unrelated to our performance.

Investors in this offering will incur substantial immediate dilution of up to $2.55 per share.

Investors who purchase shares of common stock in this offering will pay a per share price that substantially exceeds the value of our assets after subtracting liabilities. Accordingly, the offering price is substantially higher than the book value per share of our outstanding common stock. As a result, an investor who acquires shares of common stock in this offering will incur immediate substantial dilution of approximately $2.55 per share. For a more detailed description of how new stockholders will incur dilution, see the “Dilution” section on page 28 of this prospectus.

Future sales of our common stock may result in a decrease in the market price of our common stock, even if our business is doing well.

The market price of our common stock could drop due to sales of a large number of shares of our common stock in the market after the offering or the perception that such sales could occur. This could make it more difficult to raise funds through future offerings of common stock.

On completion of this offering, we will have outstanding 9,443,467 shares of our common stock. This includes the 5,000,000 shares we are selling in this offering, all of which may be resold in the public market immediately. As of September 2, 2008, our executive officers and directors own 404,102 shares and also hold currently exercisable options to acquire an additional 532,000 shares after the closing of this offering. The shares held by our executive officers, directors and certain of our stockholders are subject to lock-up agreements that prohibit their sale until at least 180 days after the date of this prospectus. Our debenture holders have agreed to subject their shares to lock-up agreements that prohibit the sale of their shares until at

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least 60 days after the date of this prospectus. Each of these lock-up periods can be extended for up to an additional 34 days under certain circumstances. Our underwriters, in their sole discretion, may permit our executive officers, directors, or debenture holders to sell their shares prior to the expiration of their respective lock-up agreements. After the lock-up agreements expire, all of the shares of our common stock held by our executive officers, directors and debenture holders will be eligible for sale in the public market. In addition, the 770,500 shares of our common stock that are subject to outstanding options and warrants as of September 2, 2008 will be eligible for sale in the public market to the extent permitted by the provisions of the various vesting arrangements, the lock-up agreements and applicable securities laws. If these additional shares are sold, or it is perceived they will be sold, the trading price of our common stock could decline. These sales also might make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate.

We have substantial discretion to use the proceeds from this offering for business activities that may not be successful, which could adversely affect the trading price of our common stock.

Other than with respect to the repayment of the indebtedness, our management has broad discretion as to how to spend the proceeds from this offering and may spend these proceeds in ways with which our stockholders may not agree or on business activities or acquisitions which may not be successful. If we choose to invest some or all of the proceeds from this offering, that investment may not yield a favorable return, if any. If our management fails to effectively use the proceeds from this offering, our business and results of operations could be adversely affected.

Our articles of incorporation, bylaws and Nevada Law contain provisions that could discourage an acquisition or change of control of us.

Our articles of incorporation authorize our board of directors to issue preferred stock and common stock without stockholder approval. If our board of directors elects to issue preferred stock, it could be more difficult for a third party to acquire control of us. In addition, provisions of the articles of incorporation and bylaws could also make it more difficult for a third party to acquire control of us. In addition, Nevada’s “Combination with Interested Stockholders’ Statute” and its “Control Share Acquisition Statute” may have the effect in the future of delaying or making it more difficult to effect a change in control of us.

These statutory anti-takeover measures may have certain negative consequences, including an effect on the ability of our stockholders or other individuals to (i) change the composition of the incumbent board of directors; (ii) benefit from certain transactions which are opposed by the incumbent board of directors; and (iii) make a tender offer or attempt to gain control of us, even if such attempt were beneficial to us and our stockholders. Since such measures may also discourage the accumulations of large blocks of our common stock by purchasers whose objective is to seek control of us or have such common stock repurchased by us or other persons at a premium, these measures could also depress the market price of our common stock. Accordingly, our stockholders may be deprived of certain opportunities to realize the “control premium” associated with take-over attempts.

We have no plans to pay dividends on our common stock. You may not receive funds without selling your stock.

We do not anticipate paying any cash dividends on our common stock in the foreseeable future. We are restricted under our credit facility from paying dividends without the consent of our lenders. We currently intend to retain future earnings, if any, to finance the expansion of our business. Our future dividend policy is within the discretion of our board of directors and will depend upon various factors, including our business, financial condition, results of operations, capital requirements, investment opportunities and restrictions imposed by our credit facility.

We may issue shares of preferred stock with greater rights than our common stock.

Although we have no current plans, arrangements, understandings or agreements to issue any preferred stock, our articles of incorporation authorizes our board of directors to issue one or more series of preferred

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stock and set the terms of the preferred stock without seeking any further approval from our stockholders. Any preferred stock that is issued may rank ahead of our common stock, with respect to dividends, liquidation rights and voting rights, among other things.

We have derivative securities currently outstanding. Exercise of these derivatives will cause dilution of the stock ownership percentage of existing stockholders.

As of September 2, 2008, we had options and warrants to purchase approximately 770,500 shares of common stock outstanding in addition to 2,500 shares issuable upon conversion of a convertible note. The exercise of our outstanding options and warrants, and the conversion of the note, will cause additional shares of common stock to be issued, resulting in the reduction of the percentage of outstanding shares held by our existing common stockholders.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, or the Securities Exchange Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Securities Exchange Act. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control. All statements, other than statements of historical fact, contained in this prospectus, including statements regarding future events, our future financial performance, business strategy and plans and objectives of management for future operations, are forward-looking statements. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “should” or “will” or the negative of these terms or other comparable terminology. Although we do not make forward-looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks outlined under “Risk Factors” or elsewhere in this prospectus, which may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time and it is not possible for us to predict all risk factors, nor can we address the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from those contained in any forward-looking statements. The factors impacting these risks and uncertainties include, but are not limited to:

•  estimated quantities and quality of oil and natural gas reserves;

•  fluctuations in the price of oil and natural gas;

•  fluctuations in production due to weather, equipment failure, normal operating cycles and other unforseen conditions;

•  inability to efficiently manage our operations;

•  the inability of management to effectively implement our strategies and business plans;

•  potential default under our secured obligations or material debt agreements;

•  approval of certain parts of our operations by state regulators;

•  inability to hire or retain sufficient qualified operating field personnel;

•  inability to attract and obtain additional development capital;

•  increases in interest rates or our cost of borrowing;

•  deterioration in general or regional (especially Eastern Kansas) economic conditions;

•  adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;

•  the occurrence of natural disasters, unforeseen weather conditions, or other events or circumstances that could impact our operations or could impact the operations of companies or contractors we depend upon in our operations;

•  inability to acquire mineral leases at a favorable economic value that will allow us to expand our development efforts;

•  inability to achieve future sales levels or other operating results;

•  adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations; and

•  changes in U.S. GAAP or in the legal, regulatory and legislative environments in the markets in which we operate.

You should not place undue reliance on any forward-looking statement, each of which applies only as of the date of this prospectus. Before you invest in our common stock, you should be aware that the occurrence of the events described in the section entitled “Risk Factors” and elsewhere in this prospectus could negatively affect our business, operating results, financial condition and stock price. Except as required by law, we undertake no obligation to update or revise publicly any of the forward-looking statements after the date of this prospectus to conform our statements to actual results or changed expectations.

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USE OF PROCEEDS

We estimate the net proceeds to us from the sale of 5,000,000 shares of common stock that we are selling in this offering will be approximately $22.25 million, assuming an offering price of $5.00 per share based on the closing price of our common stock as set forth on the cover page of this prospectus, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. If the underwriters’ option to purchase additional shares is exercised in full, we estimate we will receive net proceeds of approximately $25.7 million.

Of the net proceeds from this offering, we expect to use approximately:

•  $2.7 million, plus accrued interest, for the repayment of our 10% debentures, which are due in March 2010. We used the proceeds from the debentures for development of our Black Oaks Project, the Thoren Project acquisition, other lease acquisitions and general working capital; and

•  $10.75 million, plus accrued interest, for the payment of indebtedness under our three-year, senior secured credit facility. The interest rate applicable to our borrowing under this facility and the use of proceeds from such borrowings are described beginning on page 37 of this prospectus.

We intend to use the remainder of the net proceeds from this offering for the continued development of our existing projects, acquisitions, capital expenditures, working capital and general corporate purposes. The amounts actually spent for these purposes may vary significantly and will depend on a number of factors, including our operating costs and other factors described under “Risk Factors.” While we have no present understandings, commitments or agreements to enter into any material acquisitions, we are in various stages of negotiations to buy or lease property or equipment that complements our business. Accordingly, management will retain broad discretion as to the allocation of the net proceeds of this offering.

Pending the uses described above, we will invest the net proceeds of this offering in short-term, interest-bearing, investment-grade securities. We cannot predict whether the proceeds will yield a favorable return.

DIVIDEND POLICY

We have never paid or declared any cash dividends on our common stock. We currently intend to retain any future earnings to finance the growth and development of our business and we do not expect to pay any cash dividends on our common stock in the foreseeable future. In addition, we are contractually prohibited by the terms of our outstanding debt from paying cash dividends on our common stock. Payment of future dividends, if any, will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, restrictions contained in current or future financing instruments, including the consent of debt holders, if applicable at such time, and other factors our board of directors deems relevant.

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CAPITALIZATION

You should read this capitalization table in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and related notes included elsewhere in this prospectus.

The following table sets forth our capitalization as of June 30, 2008 on:

•  an actual consolidated historical basis; and

•  on a pro forma basis to reflect the sale of shares of our common stock in this offering at an assumed offering price of $5.00 per share based on the closing price of our common stock as set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimate offering costs payable by us, and the use of proceeds therefrom.

	As of June 30, 2008
				Pro Forma
	Actual			As Adjusted
	(Unaudited)			(Unaudited)
Stockholders’ equity:
Common stock; $0.001 par value, 100,000,000 shares authorized, 4,442,833 issued and outstanding, actual; 9,442,833 issued and outstanding, pro forma as adjusted		4,443			9,443
Additional paid-in capital		8,910,006			31,155,006
Retained (deficit)		(8,055,706	)		(8,055,706	)
Total stockholders’ equity		858,743			23,108,743
Total capitalization	$	858,743		$	23,108,743

The information in the table above excludes:

•  695,500 shares of our common stock issuable upon exercise of outstanding options under our existing 2000/2001 Stock Option Plan and EnerJex Resources, Inc. Stock Option Plan, at a weighted average exercise price of $6.30 per share;

•  2,500 shares issuable upon conversion of an unsecured $25,000 6% convertible note due August 2, 2010, which is convertible into shares of our common stock at $10.00 per share;

•  75,000 shares of our common stock issuable upon the exercise of outstanding warrants, at an exercise price of $3.00 per share, that were issued to the placement agent in connection with the private placement of $9.0 million of debentures in April 2007; and

•  250,000 shares of our common stock issuable upon the exercise of warrants to be issued to the underwriters in connection with this offering at an exercise price equal to 135% of the offering price.

The information in the table above:

•  Assumes no exercise of the underwriters’ option to purchase additional shares.

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DILUTION

If you purchase our shares of common stock in this offering, you will experience immediate and substantial dilution to the extent of the difference between the public offering price per share and the net tangible book value per share of our common stock after this offering. We calculate net tangible book value per share by dividing the net tangible book value, tangible assets less total liabilities, by the number of outstanding shares of our common stock.

Our net tangible book value (unaudited) at June 30, 2008, was approximately $858,743 or $0.19 per share, based on 4,442,833 shares of our common stock outstanding as of June 30, 2008. After giving effect to the sale of 5,000,000 shares of common stock by us at an assumed public offering price of $5.00 per share, less our estimated offering expenses, our net tangible book value (unaudited) at June 30, 2008, would have been approximately $23,108,743, or $2.45 per share. This represents an immediate increase in the net tangible book value of $2.26 per share to existing stockholders and an immediate dilution of $2.55 per share to investors in this offering. The following table illustrates this per share dilution:

Assumed public offering price per share	$	5.00
Net tangible book value per share as of June 30, 2008 (unaudited)		858,743
Increase in net tangible book value per share after the offering		22,250,000
As adjusted net tangible book value per share after this offering		23,108,743
Dilution in as adjusted net tangible book value per share to new investors	$	2.55

The following table summarizes, on an as adjusted basis set forth above as of June 30, 2008, the total number of shares of common stock owned by existing stockholders and to be owned by new investors, the total consideration paid, and the average price per share paid by our existing stockholders and to be paid by new investors in this offering at an assumed offering price of $5.00, based on the closing price of our common stock as set forth on the cover page of this prospectus, calculated before deduction of estimated underwriting discounts and commissions.

	Shares Purchased					Total Consideration					Average Price
	Number		Percent			Amount		Percent			per Share
	(In thousands)
Existing Stockholders		4,442,833		47.0	%	$	8,914,449		28.6	%	$	2.01
New Public Investors		5,000,000		53.0	%	$	22,250,000		71.4	%	$	4.45
Total		9,442,833		100	%	$	31,164,449		100	%	$	3.30

If the over-allotment option is exercised in full, the number of shares of common stock held by existing stockholders will be reduced to approximately 43.6% of the total number of shares of common stock outstanding after this offering. Sales of common stock by us, if the over-allotment is exercised in full, will increase the number of shares of common stock held by new investors to 5,750,000, or approximately 56.4% of the total number of shares of common stock outstanding after this offering.

As of September 2, 2008, there were 4,443,467 shares of our common stock outstanding held by approximately 1,130 stockholders of record.

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PRICE RANGE OF COMMON STOCK

Prior to completion of the reverse merger with Midwest Energy in August 2006, our common stock was sporadically traded in the inter-dealer markets of the OTC:BB, “pink sheets” and “gray sheets” under the symbol “MPCO.” As of March 23, 2007, our common stock commenced trading on the OTC:BB under the symbol “EJXR.” On July 28, 2008, in conjunction with the implementation of the 1-for-5 reverse stock split of all of our common stock, our trading symbol on the OTC:BB changed to ENRJ. Our common stock has traded infrequently on the OTC:BB, which limits our ability to locate accurate high and low bid prices for each quarter within the last two fiscal years. Therefore, the following table lists the quotations for the high and low bid prices as reported by a Quarterly Trade and Quote Summary Report of the OTC Bulletin Board and Yahoo! Finance for fiscal years 2007 and 2008, the first quarter of fiscal year 2009 and the relevant portion of the second quarter of fiscal year 2009. The quotations reflect inter-dealer prices without retail mark-up, markdown, or commissions and may not represent actual transactions.

	Low		High
Fiscal 2007
Quarter ended June 30, 2006	$	0.50	$	6.25
Quarter ended September 30, 2006	$	4.50	$	7.50
Quarter ended December 31, 2006	$	3.75	$	6.00
Quarter ended March 31, 2007	$	0.50	$	0.60
Fiscal 2008
Quarter ended June 30, 2007	$	5.00	$	6.25
Quarter ended September 30, 2007	$	3.75	$	6.75
Quarter ended December 31, 2007	$	3.50	$	6.00
Quarter ended March 31, 2008	$	4.05	$	6.00
Fiscal 2009
Quarter ended June 30, 2008	$	4.80	$	5.90
Quarter ending September 30, 2008 (through September 2, 2008)	$	4.00	$	5.10

The last reported sale price of our common stock on the OTC:BB was $5.00 per share on September 2, 2008. As of September 2, 2008, there were 1,130 holders of record of our common stock.

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

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes to our financial statements included elsewhere in this prospectus. In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those discussed under “Risk Factors” and elsewhere in this prospectus.

Overview

Our principal strategy is to focus on the acquisition of oil and natural gas mineral leases that have existing production and cash flow. Once acquired, we implement an accelerated development program utilizing capital resources, a regional operating focus, an experienced management and technical team, and enhanced recovery technologies to attempt to increase production and increase returns for our stockholders. Our oil and natural gas acquisition and development activities are currently focused in Eastern Kansas.

During fiscal 2008 and the first quarter of fiscal 2009, we deployed approximately $10.8 million in capital resources to acquire and develop five operating projects and drill 132 new wells (90 producing wells and 42 water injection wells). Our estimated total proved oil reserves increased from zero as of March 31, 2007 to a net 1.4 million barrels of oil equivalent, or BOE, as of March 31, 2008. Of the 1.4 million BOE of total proved reserves, approximately 64% are proved developed and approximately 36% are proved undeveloped. The proved developed reserves consist of 82% proved developed producing reserves and 18% proved developed non-producing reserves. Our gross production for the month of June 2008 was approximately 278 BOEPD. On August 26, 2008 our gross production was approximately 325 Barrels.

The total proved PV10 (present value) before tax of our reserves as of March 31, 2008 was $39.6 million. PV10 is a non-GAAP financial measure and generally differs from the standardized measure of discounted future net cash flows, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future net revenues. See “Glossary” on page 80 for our definition of PV10 and see page 34 for a reconciliation to the comparable GAAP financial measure.

We have several other projects that are in various stages of discussions, and we are continually evaluating oil and natural gas opportunities in Eastern Kansas. We plan to continue to bring multiple potential acquisitions to various financial partners for evaluation and funding options. It is our vision to grow the business in a disciplined and well-planned manner.

In addition to raising additional capital, we may take on working interest participants that will contribute to the capital costs of drilling and completion and then share in revenues derived from production. This economic strategy will allow us to utilize our own financial assets toward the growth of our leased acreage holdings, pursue the acquisition of strategic oil and natural gas producing properties or companies and generally expand our existing operations while further diversifying risk.

We began generating revenues from the sale of oil during the fiscal year ended March 31, 2008. We expect our production to continue to increase, both through development of wells and through our acquisition strategy. Our future financial results will continue to depend on: (i) our ability to source and screen potential projects; (ii) our ability to discover commercial quantities of natural gas and oil; (iii) the market price for oil and natural gas; and (iv) our ability to fully implement our exploration, workover and development program, which is in part dependent on the availability of capital resources. There can be no assurance that we will be successful in any of these respects, that the prices of oil and natural gas prevailing at the time of production will be at a level allowing for profitable production, or that we will be able to obtain additional funding at terms favorable to us to increase our currently limited capital resources. The board of directors has implemented a crude oil and natural gas hedging strategy that will allow management to hedge up to 80% of our net production to mitigate a majority of our exposure to changing oil prices in the intermediate term.

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Recent Developments

As of March 31, 2008, our estimated total proved reserves were 1.4 million BOE and the total proved PV10 (present value) of reserves before tax was $39.6 million. See “Glossary” on page 80 for our definition of PV10 and see page 34 for a reconciliation to the comparable GAAP financial measure.

On March 6, 2008, we entered into an agreement with Shell whereby we agreed to an 18-month fixed-price swap with Shell for 130 BOPD beginning on April 1, 2008 at a fixed price per barrel of $96.90, less transportation costs. This represented approximately 60% of our total current oil production on a net revenue basis at that time and locked in approximately $6.8 million in gross revenue before the deduction of transportation costs over the 18 month period. In addition, we agreed to sell all of our remaining oil production at current spot market pricing beginning April 1, 2008 through September 30, 2009 to Shell.

Our in-fill drilling and waterflood enhanced recovery techniques at the Black Oaks Project has increased gross oil production to approximately 106 Barrels on August 26, 2008 from a level of an average of approximately 32 BOEPD when the project was originally acquired. On June 30, 2008, the Black Oaks Project had 63 active production wells and 13 active water injection wells, an increase of 28 production wells and 13 water injection wells since the project was originally acquired. Based upon these results, we anticipate commencing Phase II of the development plan, which contemplates drilling over 25 additional water injection wells and completing over 20 additional producer wells.

In June 2008, we received our second payment of $300,000 from Euramerica related to its option exercise for the Gas City Project. To date, Euramerica has paid $600,000 of the $1.2 million purchase price and $500,000 of the $2.0 million development funds. Upon payment of the entire purchase price, Euramerica will be assigned a 95% working interest, and we will retain a 5% carried working interest before payout. When the project reaches payout, our 5% carried working interest will increase to a 25% working interest and Euramerica will have a 75% working interest.

On July 3, 2008, we entered into a new three-year $50 million senior secured credit facility with Texas Capital Bank, N. A. with an initial borrowing base of $10.75 million based on our current proved oil and natural gas reserves. We used our initial borrowing under this facility of $10.75 million to redeem an aggregate principal amount of $6.3 million of our 10% debentures, assign approximately $2.0 million of our existing indebtedness with another bank to this facility, repay $965,000 of seller-financed notes, pay the transaction costs, fees and expenses of this new facility and expand our current development projects, including the completion of newly drilled wells.

As of July 3, 2008, we entered into an ISDA master agreement and a costless collar with BP Corporation North America Inc., or BP, for 130 BOPD with a price floor of $132.50 per barrel and a price ceiling of $155.70 per barrel for NYMEX West Texas Intermediate for the period of October 1, 2009 until March 31, 2011.

On July 7, 2008, we amended the $2.7 million of aggregate principal amount of our 10% debentures that remain outstanding to, among other things, permit the indebtedness under our new credit facility, subordinate the security interests of the debentures to the new credit facility, provide for the redemption of the remaining debentures with the net proceeds from our next debt or equity offering, and eliminate the covenant to maintain certain production thresholds.

On August 1, 2008, we entered into three-year employment agreements with C. Stephen Cochennet, our president and chief executive officer, and Dierdre P. Jones, our chief financial officer.

On August 8, 2008, we entered into a five year lease for corporate office space beginning September 1, 2008.

On August 26, 2008, our gross production was approximately 325 Barrels.

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Results of Operations for the Fiscal Years Ended March 31, 2008 and 2007 Compared

During the fiscal year ended March 31, 2007, we were in the early stage of developing properties in Kansas and had minimal production or revenues from those properties. Our operations as of March 31, 2007 were limited to technical evaluation of these properties, the design of development plans to exploit the oil and natural gas resources on those properties, as well as seeking financing opportunities to acquire additional oil and natural gas properties. Therefore comparisons between the fiscal year ended March 31, 2008 to the fiscal year ended March 31, 2007 are not indicative of our future results of operations.

Income

	Fiscal Year Ended
	March 31,
	2008		2007		Increase/(Decrease)
	Amount		Amount		$
	(audited)		(audited)
Oil and natural gas revenues	$	3,602,798	$	90,800	$	3,511,998

Revenues

Oil and natural gas revenues for the fiscal year ended March 31, 2008 were $3,602,798 compared to revenues of $90,800 in the fiscal year ended March 31, 2007. The increase in revenues is primarily the result of the sale of oil from leases acquired beginning in April 2007 and developed during the period. The average price per barrel of oil, net of transportation costs, sold during the twelve months ended March 31, 2008 was $79.71. The average price per Mcf for natural gas sales during the fiscal year ended March 31, 2008 was $6.20, compared to $4.72 during the fiscal year ended March 31, 2007.

Expenses

	Fiscal Year Ended
	March 31,
	2008		2007		Increase/(Decrease)
	Amount		Amount		$
	(audited)		(audited)
Expenses:
Direct operating costs	$	1,795,188	$	172,417	$	1,622,771
Repairs on oil and gas equipment		—		165,603		(165,603	)
Depreciation, depletion and amortization		913,224		11,477		901,747
Total production expenses		2,708,412		349,497		2,358,915
Professional fees		1,226,998		302,071		924,927
Salaries		1,703,099		288,016		1,415,083
Depreciation on other fixed assets		22,106		12,501		9,605
Administrative expense		887,872		182,773		705,099
Impairment of oil and gas properties		—		273,959		(273,959	)
Impairment of goodwill		—		677,000		(677,000	)
Total expenses	$	6,548,487	$	2,085,817	$	4,462,670

Direct Operating Costs and Repairs on Oil and Gas Equipment

Direct operating and repair costs for the fiscal year ended March 31, 2008 were $1,795,188 compared to $338,020 for the fiscal year ended March 31, 2007. The increase over the prior period reflects the operating costs on the oil leases acquired during the period beginning in April 2007. Direct costs include pumping, gauging, pulling, certain contract labor costs, and other non-capitalized expenses. Repair costs relate to major repair and maintenance projects.

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Depreciation, Depletion and Amortization

Depreciation, depletion and amortization for the fiscal year ended March 31, 2008 was $913,224, compared to $11,477 for the fiscal year ended March 31, 2007. The increase was primarily a result of the depletion of oil reserves commensurate with our increase in production.

Professional Fees

Professional fees for the fiscal year ended March 31, 2008 were $1,226,998 compared to $302,071 for the fiscal year ended March 31, 2007. The increase in professional fees was largely the result of $773,659 in non-cash equity based payments made by issuing stock options to directors and an outside consultant. Additionally, payments for services rendered in connection with acquisition and financing activities, our audit, legal and consulting fees increased with the increased operations of the business.

Salaries

Salaries for the fiscal year ended March 31, 2008 were $1,703,099 compared to $288,016 for the fiscal year ended March 31, 2007. Of the increase, $1,204,102 was related to non-cash equity based payments made by issuing stock options to our management. In addition, the number of full-time employees increased from 2 at March 31, 2007 to 9 at March 31, 2008.

Depreciation on Other Fixed Assets

Depreciation on other fixed assets for the fiscal year ended March 31, 2008 was $22,106 compared to $12,501 for the fiscal year ended March 31, 2007. The increase was primarily due to depreciation on fixed assets acquired during the period.

Administrative Expense

Administrative expense for the fiscal year ended March 31, 2008 was $887,872 compared to $182,773 in the fiscal year ended March 31, 2007. The administrative expense increased in relation to the addition of employees, office space, and corporate activity related to growth in operations.

Impairment of Oil and Gas Properties

The impairment of oil and natural gas properties in the year ended March 31, 2007 of $273,959 represented all of the cost of our oil and natural gas properties accounted for under the full-cost method that was subject to amortization at March 31, 2007. We took this impairment based on the full-cost method ceiling.

Impairment of Goodwill

In the year ended March 31, 2007 we impaired $677,000 of goodwill resulting from an acquisition because of our impairment test. We have no goodwill recorded in our financial statements at March 31, 2008.

Reserves

Our estimated total proved PV 10 (present value) of reserves as of March 31, 2008 increased to $39.6 million from zero as of March 31, 2007. We increased total proved reserves to 1.4 million barrels of oil equivalent (BOE). Of the 1.4 million BOE, approximately 64% are proved developed and approximately 36% are proved undeveloped. The proved developed reserves consist of proved developed producing (82%) and proved developed non-producing (18%).

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The following table presents summary information regarding our estimated net proved reserves as of March 31, 2008. All calculations of estimated net proved reserves have been made in accordance with the rules and regulations of the SEC, and, except as otherwise indicated, give no effect to federal or state income taxes. The estimates of net proved reserves are based on the reserve reports prepared by McCune Engineering P.E., our independent petroleum consultants. For additional information regarding our reserves, please see Note 12 to our audited financial statements as of and for the fiscal year ended March 31, 2008.

			PV10
Proved Reserves Category	Gross	Net	(before tax)(1)
Proved, Developed Producing
Oil (stock-tank barrels)	1,034,163	746,169
Natural Gas (mcf)	141,371	114,610
Total Developed Producing			$	22,750,447
Proved, Developed Non-Producing
Oil (stock-tank barrels)	141,900	115,071
Natural Gas (mcf)	350,000	286,587
Total Developed Non-Producing			$	5,446,999
Proved, Undeveloped
Oil (stock-tank barrels)	705,750	510,974
Natural Gas (mcf)	-0-	-0-
Total Undeveloped			$	11,413,886
Total Proved Reserves
Oil (stock-tank barrels)	1,881,813	1,372,214
Natural Gas (mcf)	491,371	401,197
Total			$	39,611,332

(1) The following table shows our reconciliation of our PV10 to our standardized measure of discounted future net cash flows (the most direct comparable measure calculated and presented in accordance with GAAP). PV10 is our estimate of the present value of future net revenues from estimated proved natural gas reserves after deducting estimated production and ad valorem taxes, future capital costs and operating expenses, but before deducting any estimates of future income taxes. The estimated future net revenues are discounted at an annual rate of 10% to determine their “present value.” We believe PV10 to be an important measure for evaluating the relative significance of our oil and natural gas properties and that the presentation of the non-GAAP financial measure of PV10 provides useful information to investors because it is widely used by professional analysts and sophisticated investors in evaluating oil and gas companies. Because there are many unique factors that can impact an individual company when estimating the amount of future income taxes to be paid, we believe the use of a pre-tax measure is valuable for evaluating our company. We believe that most other companies in the oil and gas industry calculate PV10 on the same basis. PV10 should not be considered as an alternative to the standardized measure of discounted future net cash flows as computed under GAAP.

	As of
	March 31,
	2008
PV10	$	39,611,332
Future income taxes, net of 10% discount		(11,410,779	)
Standardized measure of discounted future net cash flows	$	28,200,553

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Results of Operations for the Three Months Ended June 30, 2008 and 2007 compared

During the three months ended June 30, 2007, we were in the early stage of developing properties in Kansas and had minimal production or revenues from our properties. Our operations as of June 30, 2007 were limited to technical evaluation of these properties, the design of development plans to exploit the oil and natural gas resources on those properties, as well as seeking financing opportunities to acquire additional oil and natural gas properties. Therefore comparisons between the three months ended June 30, 2008 to the three months ended June 30, 2007 are not indicative of our future results of operations.

Income

	Three Months Ended
	June 30,
	2008		2007
	Amount		Amount		Increase/(Decrease)
	(unaudited)		(unaudited)		$
Oil and natural gas revenues	$	1,690,086	$	146,203	$	1,543,883

Revenues

Oil and natural gas revenues for the three months ended June 30, 2008 were $1,690,086 compared to revenues of $146,203 in the three months ended June 30, 2007. The increase in revenues is primarily the result of the sale of oil from leases acquired beginning in April 2007 and developed thereafter. The average price per barrel of oil, net of transportation costs, sold during the three months ended June 30, 2008 was $100.51 compared to $58.77 during the three months ended June 30, 2007. The average price per Mcf for natural gas sales during the three months ended June 30, 2008 was $8.61, compared to $6.00 during the three months ended June 30, 2007.

Expenses

	Three Months Ended
	June 30,
	2008		2007
	Amount		Amount		Increase/(Decrease)
	(unaudited)		(unaudited)		$
Expenses:
Direct operating costs	$	714,534	$	59,042	$	655,492
Depreciation, depletion and amortization		370,190		14,245		355,945
Total production expenses		1,084,724		73,287		1,011,437
Professional fees		143,678		874,505		(730,827	)
Salaries		217,487		1,122,190		(904,703	)
Administrative expense		219,487		129,937		89,550
Interest Expense		274,386		69,742		204,644
Loan costs		382,124		2,336,597		(1,954,473	)
Total expenses		2,321,886		4,606,258		(2,284,372	)

Direct Operating Costs

Direct operating costs for the three months ended June 30, 2008 were $714,534 compared to $59,042 for the three months ended June 30, 2007. The increase over the prior period reflects the operating costs on the oil leases acquired during the period beginning in April 2007. Direct costs include pumping, gauging, pulling, certain contract labor costs, and other non-capitalized expenses.

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Depreciation, Depletion and Amortization

Depreciation, depletion and amortization for the three months ended June 30, 2008 was $370,190, compared to $14,245 for the three months ended June 30, 2007. The increase was primarily a result of the depletion of oil reserves commensurate with our increase in production.

Professional Fees

Professional fees for the three months ended June 30, 2008 were $143,678 compared to $874,505 for the three months ended June 30, 2007. The decrease in professional fees was largely the result of $773,659 in non-cash equity-based payments made by issuing stock options to directors and an outside consultant in the prior year. No such payments were made in the current period.

Salaries

Salaries for the three months ended June 30, 2008 were $217,487 compared to $1,122,190 for the three months ended June 30, 2007. Non-cash equity-based payments made by issuing stock options to our management in the prior year were $1,028,262 as compared to $43,551 in the current period, resulting in a decrease.

Administrative Expense

Administrative expense for the three months ended June 30, 2008 was $219,487, compared to $129,937 in the three months ended June 30, 2007. The administrative expense increased as a result of the addition of employees, office space, and corporate activity related to growth in operations.

Interest Expense

Interest expense for the three months ended June 30, 2008 was $274,386 as compared to $69,742 for the three months ended June 30, 2007 and was primarily related to our debentures. Interest income of $46,021 in the period ended June 30, 2007 offset the interest expense in that same period as the income was earned on proceeds from debentures. We had minimal interest income for the period ended June 30, 2008.

Loan Costs

Loan costs for the three months ended June 30, 2008 were $382,124 as compared to $2,336,597 for the three months ended June 30, 2007. In the prior period, we recorded $2,126,271 in loan penalty expense, which was directly attributable to the accretion of the potential expense related to the issuance of threshold shares under our $9.0 million debenture financing. The loan penalty expense was reversed in a subsequent quarter based on our determination that production levels were sufficient to meet required threshold levels. We also had loan fee expense of $39,298 and $34,560, and loan interest accretion of $342,826 and $175,766, respectively, for the periods ending June 30, 2008 and 2007, all related to our debentures. The amount of interest accreted is based on the interest method over the period of issue to maturity.

Liquidity and Capital Resources

Liquidity is a measure of a company’s ability to meet potential cash requirements. We have historically met our capital requirements through debt financing, revenues from operations and the issuance of equity securities. In the future, we anticipate we will be able to provide some of the necessary liquidity we need by the revenues generated from our net interests in our oil and natural gas production, and sales of reserves in our existing properties, however, if we do not generate sufficient sales revenues we will continue to finance our operations through equity and/or debt financings.

We actively manage our exposure to commodity price fluctuations by executing derivative transactions to hedge the change in prices of our production, thereby mitigating our exposure to price declines, but these transactions will also limit our earnings potential in periods of rising commodity prices. There also is a risk

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that we will be required to post collateral to secure our hedging activities and this could limit our available funds for our business activities.

We have utilized a costless collar with BP beginning October 1, 2009 through March 31, 2011 to set minimum and maximum prices on a financially settled collar on a set number of barrels of oil per day. We have also utilized a price swap contract with Shell for a portion of our production, and agreed to sell Shell the remainder of our current oil production at current spot market pricing, beginning April 1, 2008 through September of 2009. The key risks associated with these contracts are summarized in the “Risk Factors” section beginning on page 10.

The following table summarizes total current assets, total current liabilities and working capital at June 30, 2008 as compared to March 31, 2008.

	June 30,			March 31,			Increase/(Decrease)
	2008			2008			$
Current Assets	$	2,610,394		$	1,511,595			1,098,799
Current Liabilities	$	3,378,531		$	2,117,176			1,261,355
Working Capital (deficit)	$	(768,137	)	$	(605,581	)		(162,556	)

Discussion of Material Balance Sheet Changes from Fiscal 2007 to Fiscal 2008

During the year ended March 31, 2008, we have significantly changed the balance sheet of our company. Our business has expanded due to the issuance of stock and debt. We were able to acquire oil and natural gas leases and begin drilling on those leases. Our total assets have increased from $492,507 at March 31, 2007 to $10,867,829. Approximately 84% of our total assets at March 31, 2008 were our oil and gas properties using the full-cost accounting method. We incurred debt issue costs with the $9.0 million debenture financing completed in April and June 2007, as well as with issuance of debt with project acquisitions. Our total liabilities increased from $537,097 at March 31, 2007 to $9,433,837 at March 31, 2008 primarily as a result of these debentures.

New Senior Secured Credit Facility

On July 3, 2008, EnerJex, EnerJex Kansas, and DD Energy entered into a three-year $50 million senior secured revolving credit facility, or Credit Facility with Texas Capital Bank, N.A. Borrowings under the Credit Facility will be subject to a borrowing base limitation based on our current proved oil and gas reserves. The initial borrowing base is set at $10.75 million and will be subject to semi-annual redeterminations, with the first redetermination to be October 1, 2008. The Credit Facility will be secured by a lien on substantially all our assets. The Credit Facility has a term of three years, and all principal amounts, together with all accrued and unpaid interest, will be due and payable in full on July 3, 2011. The Credit Facility also provides for the issuance of letters-of-credit up to a $750,000 sub-limit under the borrowing base and up to an additional $2.25 million limit not subject to the borrowing base to support the Company’s hedging program. Borrowings under the Credit Facility of $10.75 million were made on July 7, 2008.

Proceeds from the initial extension of credit under the Credit Facility were used: (1) to redeem our 10% debentures in an aggregate principal amount of $6.3 million plus accrued interest, (2) for Texas Capital Bank’s acquisition of our approximately $2.0 million indebtedness to Cornerstone Bank, (3) for complete repayment of promissory notes issued to the sellers in connection with our purchase of the DD Energy project in an aggregate principal amount of $965,000 plus accrued interest, (4) to pay transaction costs, fees and expenses related to the new facility and (5) to expand our current development projects, including completion of newly drilled oil wells. Future borrowings may be used for the acquisition, development and exploration of oil and gas properties, capital expenditures and general corporate purposes.

Advances under the Credit Facility will be in the form of either base rate loans or Eurodollar loans. The interest rate on the base rate loans fluctuates based upon the higher of (1) the lender’s “prime rate” and (2) the Federal Funds rate plus 0.50%, plus, in either case, a margin of between 0.0% and 0.5% depending on the

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percent of the borrowing base utilized at the time of the credit extension. The interest rate on the Eurodollar loans fluctuates based upon the applicable Libor rate plus a margin of 2.25% to 2.75% depending on the percent of the borrowing base utilized at the time of the credit extension. Eurodollar loans of one, two, three and six months may be selected by us. A commitment fee of 0.375% on the unused portion of the borrowing base will accrue, and be payable quarterly in arrears.

The Credit Facility includes usual and customary affirmative covenants for credit facilities of this type and size, as well as customary negative covenants, including, among others, limitations on liens, mergers, asset sales or dispositions, payments of dividends, incurrence of additional indebtedness, and investments. The Credit Facility also requires us, at the end of each fiscal quarter beginning with the quarter ending September 30, 2008, to maintain a minimum current assets to current liabilities ratio and a minimum ratio of EBITDA (earnings before interest, taxes, depreciation and amortization) to interest expense and at the end of each fiscal quarter beginning with the quarter ended June 30, 2008 to maintain a minimum ratio of EBITDA to senior funded debt.

Additionally, Texas Capital Bank, N.A. and the holders of the debentures entered into a subordination agreement whereby the debentures are subordinated to the Credit Facility.

Debenture Financing

On April 11, 2007, we completed a $9.0 million private placement of senior secured debentures. In accordance with the terms of the debentures, we received $6.3 million (before expenses and placement fees) at the first closing (the “April Debentures”) and an additional $2.7 million (before closing fees and expenses) at the second closing on June 21, 2007 (the “June Debentures”). In connection with the sale of the debentures, we issued the lenders 1,800,000 shares of common stock. On July 7, 2008, we redeemed the April Debentures.

The debentures mature on March 31, 2010, absent earlier redemption by us, and carry an interest rate of 10%. Interest on the debentures began accruing on April 11, 2007 and is payable quarterly in arrears on the first day of each succeeding quarter during the term of the debentures, beginning on or about May 11, 2007 and ending on the maturity date of March 31, 2010. We may, under certain conditions specified in the debentures, pay interest payments in shares of our registered common stock. Additionally, on the maturity date, we are required to pay the amount equal to the principal, as well as all accrued but unpaid interest.

In connection with the Credit Facility, we entered into an agreement amending the Securities Purchase Agreement, Registration Rights Agreement, the Pledge and Security Agreement and the June Debentures (collectively, the “Debenture Agreements”), with the holders (the “Buyers”) of the June Debentures. Pursuant to this agreement, we, among other things, (i) redeemed the April Debentures, (ii) agreed to use the net proceeds from our next debt or equity offering to redeem the June Debentures, (iii) agreed to update the Buyers’ registration statements to sell our common stock owned by one of the Buyers, (iv) amended certain terms of the Debenture Agreements in recognition of the indebtedness under the new Credit Facility, and (v) amended the Securities Purchase Agreement and Registration Rights Agreement to remove the covenant to issue and register additional shares of common stock in the event that our oil production does not meet certain thresholds over time.

Satisfaction of our cash obligations for the next 12 months

A critical component of our operating plan is the ability to obtain additional capital through additional equity and/or debt financing and working interest participants. While our operations are generating sufficient cash revenues to meet our monthly expenses, we still have negative working capital. In the event we cannot obtain additional capital to pursue our strategic plan, however, this would materially impact our ability to continue our aggressive growth. However, there is no assurance we would be able to obtain such financing on commercially reasonable terms, if at all.

We intend to implement and successfully execute our business and marketing strategy, continue to develop and upgrade technology and products, respond to competitive developments, and attract, retain and motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks,

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and the failure to do so can have a material adverse effect on our business prospects, financial condition and results of operations.

Summary of product research and development that we will perform for the term of our plan

We do not anticipate performing any significant product research and development until such time as we can raise adequate working capital to sustain our operations.

Expected purchase or sale of any significant equipment

We anticipate that we will purchase the necessary production and field service equipment required to produce oil and natural gas during our normal course of operations over the next twelve months.

Significant changes in the number of employees

As of June 30, 2008, we had 19 full time employees, an increase from 9 full time employees at our fiscal year ended March 31, 2008. We hired a number of former independent field contractors to help secure a more stable work base. We have not experienced a material increase in expenses from this initiative, as most of these individuals were already included in our current operating and capital expenses as independent contractors. As drilling and production activities increase, we intend to hire additional technical, operational and administrative personnel as appropriate. We are using and will continue to use the services of independent consultants and contractors to perform various professional services, particularly in the area of land services, reservoir engineering, drilling, water hauling, pipeline construction, well design, well-site monitoring and surveillance, permitting and environmental assessment. We believe that this use of third-party service providers may enhance our ability to contain general and administrative expenses.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Critical Accounting Policies and Estimates

Our critical accounting estimates include our oil and gas properties, asset retirement obligations and the value of share-based payments.

Oil and Gas Properties

The accounting for our business is subject to special accounting rules that are unique to the gas and oil industry. There are two allowable methods of accounting for oil and gas business activities: the successful efforts method and the full-cost method. We follow the full-cost method of accounting under which all costs associated with property acquisition, exploration and development activities are capitalized. We also capitalize internal costs that can be directly identified with our acquisition, exploration and development activities and do not include any costs related to production, general corporate overhead or similar activities.

Under the full-cost method, capitalized costs are amortized on a composite unit-of-production method based on proved gas and oil reserves. Depreciation, depletion and amortization expense is also based on the amount of estimated reserves. If we maintain the same level of production year over year, the depreciation, depletion and amortization expense may be significantly different if our estimate of remaining reserves changes significantly. Proceeds from the sale of properties are accounted for as reductions of capitalized costs unless such sales involve a significant change in the relationship between costs and the value of proved reserves or the underlying value of unproved properties, in which case a gain or loss is recognized. The costs of unproved properties are excluded from amortization until the properties are evaluated. We review all of our unevaluated properties quarterly to determine whether or not and to what extent proved reserves have been

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assigned to the properties, and otherwise if impairment has occurred. Unevaluated properties are assessed individually when individual costs are significant.

We review the carrying value of our gas and oil properties under the full-cost accounting rules of the SEC on a quarterly basis. This quarterly review is referred to as a ceiling test. Under the ceiling test, capitalized costs, less accumulated amortization and related deferred income taxes, may not exceed an amount equal to the sum of the present value of estimated future net revenues (adjusted for cash flow hedges) less estimated future expenditures to be incurred in developing and producing the proved reserves, less any related income tax effects. In calculating future net revenues, current prices and costs used are those as of the end of the appropriate quarterly period. Such prices are utilized except where different prices are fixed and determinable from applicable contracts for the remaining term of those contracts, including the effects of derivatives qualifying as cash flow hedges. Two primary factors impacting this test are reserve levels and current prices, and their associated impact on the present value of estimated future net revenues. Revisions to estimates of gas and oil reserves and/or an increase or decrease in prices can have a material impact on the present value of estimated future net revenues. Any excess of the net book value, less deferred income taxes, is generally written off as an expense. Under SEC regulations, the excess above the ceiling is not expensed (or is reduced) if, subsequent to the end of the period, but prior to the release of the financial statements, gas and oil prices increase sufficiently such that an excess above the ceiling would have been eliminated (or reduced) if the increased prices were used in the calculations.

The process of estimating gas and oil reserves is very complex, requiring significant decisions in the evaluation of available geological, geophysical, engineering and economic data. The data for a given property may also change substantially over time as a result of numerous factors, including additional development activity, evolving production history and a continual reassessment of the viability of production under changing economic conditions. As a result, material revisions to existing reserve estimates occur from time to time. Although every reasonable effort is made to ensure that reserve estimates reported represent the most accurate assessments possible, the subjective decisions and variances in available data for various properties increase the likelihood of significant changes in these estimates.

As of March 31, 2008, approximately 100% of our proved reserves were evaluated by an independent petroleum engineer. All reserve estimates are prepared based upon a review of production histories and other geologic, economic, ownership and engineering data.

Asset Retirement Obligations

The asset retirement obligation relates to the plug and abandonment costs when our wells are no longer useful. We determine the value of the liability by obtaining quotes for this service and estimate the increase we will face in the future. We then discount the future value based on an intrinsic interest rate that is appropriate for us. If costs rise more than what we have expected there could be additional charges in the future, however, we monitor the costs of the abandoned wells and we will adjust this liability if necessary.

Share-Based Payments

The value we assign to the options and warrants that we issue is based on the fair market value as calculated by the Black-Scholes pricing model. To perform a calculation of the value of our options and warrants, we determine an estimate of the volatility of our stock. We need to estimate volatility because there has not been enough trading of our stock to determine an appropriate measure of volatility. We believe our estimate of volatility is reasonable, and we review the assumptions used to determine this whenever we issue a new equity instruments. If we have a material error in our estimate of the volatility of our stock, our expenses could be understated or overstated.

Recent Accounting Pronouncements

In September 2006, the Financial Accounting Standards Board, or FASB, issued Statements of Financial Accounting Standards, or SFAS, No. 157 (“SFAS No. 157”), “Fair Value Measures.” SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles

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(“GAAP”), expands disclosures about fair value measurements, and applies under other accounting pronouncements that require or permit fair value measurements. SFAS No. 157 does not require any new fair value measurements, however, the FASB anticipates that for some entities, the application of SFAS No. 157 will change current practice. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. We are currently reviewing the effect, if any, SFAS No. 157 will have on our financial statements.

In February 2007, the FASB issued SFAS No. 159 (“SFAS No. 159”), “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans” — the fair value option for financial assets and liabilities including in amendment of SFAS 115. SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. SFAS No. 159 is expected to expand the use of fair value measurement objectives for accounting for financial instruments. SFAS No. 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007, and interim periods within those fiscal years. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of FASB Statement No. 157, fair value measurements. We are currently evaluating the impact of SFAS No. 159 on our financial statements.

In December 2007, the FASB issued SFAS No. 141R (revised 2007) (“SFAS No. 141R”), “Business Combinations.” Although this statement amends and replaces SFAS No. 141, it retains the fundamental requirements in SFAS No. 141 that (i) the purchase method of accounting must be used for all business combinations; and (ii) an acquirer be identified for each business combination. SFAS No. 141R defines the acquirer as the entity that obtains control of one or more businesses in the business combination and establishes the acquisition date as the date that the acquirer achieves control. SFAS No. 141R applies to all transactions or other events in which an entity (the acquirer) obtains control of one or more businesses (the acquiree), including combinations achieved without the transfer of consideration; however, this statement does not apply to a combination between entities or businesses under common control. Significant provisions of SFAS No. 141R concern principles and requirements for how an acquirer (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; (ii) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (iii) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. SFAS No. 141R applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008 with early adoption not permitted. Management is assessing the impact of the adoption of SFAS No. 141R.

In December 2007, the FASB issued SFAS No. 160 (“SFAS No. 160”), “Non-controlling Interests in Consolidated Financial Statements.” SFAS No. 160 amends the Accounting Research Bulletin 51 to establish accounting and reporting standards for the non-controlling (minority) interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a non-controlling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. We have not yet determined the impact, if any, that SFAS No. 160 will have on our financial statements.

In March 2008, the FASB issued SFAS No. 161 (“FAS 161”), “Disclosures about Derivative Instruments and Hedging Activities.” FAS 161 is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on the entity’s financial position, financial performance, and cash flows. The provisions of FAS 161 are effective for the year ending December 31, 2008. We are currently evaluating the impact of the provisions of FAS 161.

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Effects of Inflation and Pricing

The oil and natural gas industry is very cyclical and the demand for goods and services of oil field companies, suppliers and others associated with the industry puts extreme pressure on the economic stability and pricing structure within the industry. Material changes in prices impact revenue stream, estimates of future reserves, borrowing base calculations of bank loans and value of properties in purchase and sale transactions. Material changes in prices can impact the value of oil and natural gas companies and their ability to raise capital, borrow money and retain personnel. We anticipate the increased business costs will continue while the commodity prices for oil and natural gas, and the demand for services related to production and exploration, both remain high (from a historical context) in the near term.

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BUSINESS AND PROPERTIES

Our Business

EnerJex, formerly known as Millennium Plastics Corporation, is an oil and natural gas acquisition, exploration and development company. Midwest Energy, Inc. was incorporated in the State of Nevada on December 30, 2005. In August of 2006, Millennium Plastics Corporation, following a reverse merger by and among us, Millennium Acquisition Sub (our wholly owned subsidiary) and Midwest Energy, changed the focus of its business plan from the development of biodegradable plastic materials and entered into the oil and natural gas industry. In conjunction with the change, the company was renamed EnerJex Resources, Inc.

Our principal strategy is to focus on the acquisition of oil and natural gas mineral leases that have existing production and cash flow. Once acquired, we implement an accelerated development program utilizing capital resources, a regional operating focus, an experienced management and technical team, and enhanced recovery technologies to attempt to increase production and increase returns for our stockholders. Our oil and natural gas acquisition and development activities are currently focused in Eastern Kansas.

During fiscal 2008 and the first quarter of fiscal 2009, we deployed approximately $10.8 million in capital resources to acquire and develop five operating projects and drill 132 new wells (90 producing wells and 42 water injection wells). Our estimated total proved oil reserves increased from zero as of March 31, 2007 to 1.4 million barrels of oil equivalent, or BOE, as of March 31, 2008. Of the 1.4 million BOE of total proved reserves, approximately 64% are proved developed and approximately 36% are proved undeveloped. The proved developed reserves consist of 82% proved developed producing reserves and 18% proved developed non-producing reserves. Our gross production for the month of June 2008 was approximately 278 BOEPD. On August 26, 2008, our gross production was approximately 325 Barrels.

The total proved PV10 (present value) before tax of our reserves as of March 31, 2008 was $39.6 million. PV10 means the estimated future gross revenue to be generated from the production of proved reserves, net of estimated production and future development and abandonment costs, using prices and costs in effect at the determination date, before income taxes, and without giving effect to non-property related expenses, discounted to a present value using an annual discount rate of 10% in accordance with the guidelines of the SEC. PV10 is a non-GAAP financial measure and generally differs from the standardized measure of discounted future net cash flows, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future net revenues. See “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

The Opportunity in Kansas

According to the Kansas Geological Survey, the State of Kansas has historically been one of the top 10 domestic oil producing regions in the United States. For the year ended December 31, 2007, 36.6 million barrels of oil were produced in Kansas. Of the total barrels produced in Kansas in 2007, 15 companies accounted for approximately 29% of this production, with the remaining 71% produced by over 2,400 independent operators.

In addition to significant historical oil and natural gas production levels in the region, we believe that a confluence of the following factors in Eastern Kansas and the surrounding region make it an attractive area for oil and natural gas development activities:

•  Traditional Roll-Up Strategy.  We are seeking to employ a traditional roll-up strategy utilizing a combination of capital resources, operational and management expertise, technology, and our strategic partnership with Haas Petroleum, which has experience operating in the region for nearly 70 years.

•  Numerous Acquisition Opportunities.  There are over 20,000 producing leases in the State of Kansas, which afford us numerous opportunities to pursue negotiated lease transactions instead of having to competitively bid on fundamentally sound assets.

•  Fragmented Ownership Structure.  There are numerous opportunities to acquire producing properties at attractive prices because of the currently inefficient and fragmented ownership structure.

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Our Properties

The following table summarizes our acreage by project name as of June 30, 2008.

	Developed Acreage				Undeveloped Acreage				Total Acreage
Project Name	Gross		Net(1)		Gross		Net(1)		Gross		Net(1)
Black Oaks Project(2)		550		522		1,850		1,758		2,400		2,280
DD Energy Project		400		400		1,280		1,280		1,680		1,680
Tri-County Project		610		606		652		651		1,262		1,257
Thoren Project		140		140		607		607		747		747
Gas City Project		680		680		6,790		6,790		7,470		7,470
Total		2,380		2,348		11,179		11,086		13,559		13,434

(1) Net acreage is based on our net working interest as of June 30, 2008.

(2) Following completion of the Black Oaks Project, or upon mutual agreement with MorMeg, we will have the option to develop the approximate 2,100 acre “Nickel Town Project.”

Black Oaks and Nickel Town Projects

In September 2006, we acquired an option to purchase the Black Oaks Project from MorMeg for $500,000 in a combination of stock and cash. In addition, we established a joint operating account and funded it with $4.0 million in April 2007 for the Phase I development plan of this project. We have a 95% working interest and MorMeg has a 5% carried working interest in the project. The Black Oaks Project currently encompasses approximately 2,400 acres in Woodson and Greenwood Counties, Kansas. At the time of its acquisition the project had approximately 35 oil wells producing an average of approximately 32 BOEPD.

The Black Oaks Project is a primary and enhanced secondary recovery project between us and MorMeg. Phase I of the Black Oaks Project development plan commenced shortly after closing with the drilling of 44 in-fill wells. During fiscal 2008, we began injecting water into the first five water injection wells at an average rate of approximately 50 barrels of water per day per well. This pilot program was expanded so that by June 30, 2008, we were injecting approximately 200 barrels of water per day per well in the 13 injection wells. In addition, adjacent oil wells have increased production from an average of approximately 5 BOEPD to 25 BOEPD. Our gross production at Black Oaks for the month of June 2008 was approximately 102 BOEPD. Gross production from the approximate 63 net wells on the Black Oaks Project was approximately 106 Barrels on August 26, 2008. Based upon these results, we plan to commence Phase II of the development plan. Phase II currently contemplates drilling over 25 additional water injection wells, and drilling and completing over 20 additional producer wells.

As of March 31, 2008, we had proved oil reserves on Phase I of this project of:

					PV10(3)
	Gross STB(1)		Net STB(2)		(Before Tax)
Proved, Developed Producing		564,107		355,869	$	6,761,835
Proved, Developed Non-Producing		-0-		-0-	$	-0-
Proved, Undeveloped		255,000		142,292	$	2,357,266
Total Proved		819,107		498,161	$	9,119,101

(1)	STB = one stock-tank barrel
(2)	Net STB is based upon our net revenue interest.

(3) See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

The degree of depletion for the Black Oak Project as of March 31, 2008 was approximately 78%. As of March 31, 2008, the Black Oaks Project had a projected life of 47 years.

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We will maintain our 95% working interest until payout, at which time the MorMeg 5% carried working interest will be converted to a 30% working interest and our working interest becomes 70%. Payout is generally the point in time when the total cumulative revenue from the project equals all of the project’s development expenditures and costs associated with funding.

We have until November 30, 2008 to contribute additional capital toward the Black Oaks Project development. If we elect not to contribute further capital to the Black Oaks Project prior to the project’s full development while it is economically viable to do so, or if there is more than a thirty day delay in project activities due to lack of capital, MorMeg has the option to cease further joint development and we will receive an undivided interest in the Black Oaks Project. The undivided interest will be the proportionate amount equal to the amount that our investment bears to our investment plus $2.0 million, with MorMeg receiving an undivided interest in what remains.

Once the parties agree that the project has been fully developed or it is no longer economically viable to fund further development, we will have earned the right to exercise our option to participate in the Nickel Town Project and will have nine-months from that time to exercise this option. Should we elect to participate in the Nickel Town Project, we will have the option of negotiating new operating and other governing agreements with MorMeg. The Nickel Town Project contains approximately 2,100 acres.

DD Energy Project

Effective September 1, 2007, we acquired a 100% working interest in the DD Energy Project for $2.7 million, which consisted of approximately 1,500 acres in Johnson, Anderson and Linn Counties of Kansas. At the time of acquisition this project was producing an average of approximately 45 BOEPD.

In addition, we have acquired additional leases bringing the total acreage for this project to approximately 1,700 acres. Our gross production for the month of June at DD Energy was approximately 57 BOEPD. As of June 30, 2008, we had 113 oil wells, 34 water injection wells and two water supply wells on this project. On August 26, 2008 gross production on this project was approximately 92 Barrels. Through June 30, 2008, we have invested an additional $880,000 in this project and have drilled and completed seven water injection wells and four producing wells which are just now coming on line.

As of March 31, 2008, we had proved oil reserves on this project of:

					PV10(3)
	Gross STB(1)		Net STB(2)		(Before Tax)
Proved, Developed Producing		231,318		195,209	$	7,391,725
Proved, Developed Non-Producing		82,900		69,058	$	2,744,148
Proved, Undeveloped		202,750		169,521	$	4,752,611
Total Proved		516,968		433,788	$	14,888,484

(1)	STB = one stock-tank barrel
(2)	Net STB is based upon our net revenue interest.

(3) See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

The degree of depletion for the DD Energy Project as of March 31, 2008 was approximately 37%. As of March 31, 2008, the DD Energy Project had a projected life of 33 years. We have identified an additional 88 drillable producer locations and 86 drillable injector locations on this project and we plan to drill approximately 100 additional wells.

Tri-County Project

On September 14, 2007, we acquired nearly a 100% working interest in the Tri-County Project for $800,000, which consisted of approximately 1,100 acres in Miami, Johnson and Franklin Counties of Kansas. At the time of acquisition, this project was producing an average of approximately 25 BOEPD.

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Through June 30, 2008, we have invested approximately $700,000 toward the development of this project. Funds have been used to drill four producer wells, make infrastructure upgrades, and perform work-overs on approximately 20 wells in this project. We have also acquired additional leases for approximately $50,000, bringing the total project to approximately 1,300 acres.

As of June 30, 2008, the Tri-County Project consisted of 170 producing wells and 52 water injection wells. Our gross production for the month of June 2008 at Tri-County was approximately 65 BOEPD. On August 26, 2008 gross production on this project was approximately 62 Barrels.

As of March 31, 2008, we had proved oil reserves on this project of:

					PV10(3)
	Gross STB(1)		Net STB(2)		(Before Tax)
Proved, Developed Producing		126,299		99,959	$	3,225,763
Proved, Developed Non-Producing		59,000		46,013	$	1,627,150
Proved, Undeveloped		210,000		166,950	$	3,705,266
Total Proved		395,299		312,922	$	8,558,179

(1)	STB = one stock-tank barrel
(2)	Net STB is based upon our net revenue interest.

(3) See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

The degree of depletion for the Tri-County Project as of March 31, 2008 was approximately 60%. As of March 31, 2008, the Tri-County Project had a projected life of 21 years. We plan to develop up to 70 additional injection and production wells. We have identified an additional 83 drillable producer locations and 90 drillable injector locations on this project.

Thoren Project

On April 27, 2007, we acquired a 100% working interest in the Thoren Project for $400,000 from MorMeg. This project originally contained 240 acres in Douglas County, Kansas. At the time of acquisition, this project had 12 oil wells producing an average of approximately 10 BOEPD, four water injection wells, and one water supply well. We have leased an additional 507 acres for $112,500, increasing the total acreage of this project to 747 gross acres.

Through June 30, 2008, we have invested approximately $600,000 for the development of this project and as of June 30, 2008, we had 33 oil wells, 15 water injection wells and one water supply well. Our gross production for the month of June at Thoren was approximately 37 BOEPD. On August 26, 2008 gross production on this project was approximately 48 BOEPD.

As of March 31, 2008, we had proved oil reserves on this project of:

					PV10(3)
	Gross STB(1)		Net STB(2)		(Before Tax)
Proved, Developed Producing		105,939		89,770	$	4,568,767
Proved, Developed Non-Producing		-0-		-0-	$	-0-
Proved, Undeveloped		38,000		32,211	$	598,743
Total Proved		143,939		121,981	$	5,167,510

(1)	STB = one stock-tank barrel
(2)	Net STB is based upon our net revenue interest.

(3) See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties-Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

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We will maintain our 100% working interest until payout and our working interest will become 75%, at which time the MorMeg working interest will be converted to a 25% working interest. Payout for this project occurs at that point in time when the total cumulative revenue from production equals the total amount of the purchase price, all costs and expenses incurred by us in the development and operation, and loan and interest costs incurred in the finance and funding of the purchase.

The degree of depletion for the Thoren Project as of March 31, 2008 was approximately 26%. As of March 31, 2008, the Thoren Project had a projected life of 26 years. We have identified an additional seven drillable producer locations and eight drillable injector locations on this project.

Gas City Project

Effective February 1, 2006, we acquired the Gas City Project for $750,000, which at that time encompassed approximately 8,800 acres in Allen County, Kansas. When we originally acquired this project, we acquired 10 natural gas wells, a natural gas gathering system, an interstate pipeline tap and a salt water disposal system for the project. Production at the time of acquisition was minimal. Subsequent to acquisition, we invested an additional $650,000 in capital improvement and development of this project. Since the time of the acquisition, we have elected to not renew certain leases in an attempt to centralize the acreage.

In August 2007, we entered into a development agreement with Euramerica to further the development and expansion of the Gas City Project, which at that time included 6,600 acres, whereby Euramerica contributed $524,000 in capital toward the project. Euramerica was granted an option to purchase this 6,600 acre portion of the project for $1.2 million with a requirement to invest an additional $2.0 million for project development by August 31, 2008. We are the operator of the project at a cost plus 17.5% basis. To date, Euramerica has paid $600,000 of the $1.2 million purchase price and $500,000 of the $2.0 million development funds. Upon payment of the entire purchase price, Euramerica will be assigned a 95% working interest, and we will retain a 5% carried working interest before payout. When the project reaches payout, our 5% carried working interest will increase to a 25% working interest and Euramerica will have a 75% working interest. Payout for this project occurs when proceeds of all revenue received by Euramerica from the production and sale of oil, gas, or other hydrocarbons produced equals the project’s total expenses. If Euramerica does not fund the remaining $1.5 million of the development funds before August 31, 2008 or does not pay its third quarterly purchase price payment of $300,000 by September 1, 2008, or its fourth quarterly purchase price payment of $300,000 by December 1, 2008, each subject to a 15 day grace period, all of the development agreements will be terminated. We would have to pay Euramerica 90% of the net revenue interest from the Euramerica wells until the development funds and purchase price payments are fully repaid solely from the net revenue interest generated by the Euramerica wells. Following repayment, Euramerica would not have any interest in this property or the Euramerica wells.

As of June 30, 2008, the project contained approximately 7,470 acres and we had drilled and completed 10 producing wells. Our gross production for the month of June 2008 at Gas City was approximately 17 BOEPD. On August 26, 2008, gross production on this project was approximately 17 Barrels.

The following table sets forth our working interest and net revenue interest levels in the Gas City Project Euramerica Wells.

	Gas City Project
	Euramerica Wells
				Company
	Company			Net
	Working			Revenue
	Interest			Interest(1)
Before Euramerica first Purchase Price Payment on February 29, 2008		100	%(2)		10	%
After First Purchase Price payment but Before Full Purchase Price Paid		100	%(2)		5	%
After Full Purchase Price Paid, but Before Payout		5	%(2)		5	%
After Payout		25	%		25	%

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(1)	For purposes of this table, net revenue interest is our revenue interest of the working interest owners’ proceeds from the sale of production.
(2)	These working interests are carried working interests.

As of March 31, 2008, we had proved oil and natural gas reserves on this project of:

	Gross		Net		Gross		Net		PV10(5)
	STB(1)		STB(2)		MCF(3)		MCF(4)		(before tax)
Proved, Developed Producing		6,500		5,362		141,371		114,610	$	802,357
Proved, Developed Non-Producing		-0-		-0-		350,000		286,587	$	1,075,701
Proved, Undeveloped		-0-		-0-		-0-		-0-	$	-0-
Total Proved		6,500		5,362		491,371		401,197	$	1,878,058

(1)	STB = one stock-tank barrel.
(2)	Net STB is based upon our net revenue interest.
(3)	MCF = thousand cubic feet of natural gas.
(4)	Net MCF is based upon our net revenue interest.
(5)	See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

The degree of depletion for the Gas City Project as of March 31, 2008 was approximately 20% on gas reserves and 0% on oil reserves.

We have drilled 12 new wells since March 31, 2008 on behalf of Euramerica. Development of this project will be dependent on additional capital contributed by Euramerica.

Our Business Strategy

Our goal is to increase stockholder value by finding and developing oil and natural gas reserves at costs that provide an attractive rate of return on our investments. The principal elements of our business strategy are:

•  Develop Our Existing Properties.  We intend to create near-term reserve and production growth from over 400 additional drilling locations identified on our properties. We have identified an additional 193 drillable producer locations and 213 drillable injector locations. The structure and the continuous oil accumulation in Eastern Kansas, and the expected long-life production and reserves of our properties, are anticipated to enhance our opportunities for long-term profitability. As of March 31, 2008, our Black Oaks, DD Energy, Tri-County and Thoren Projects have projected lives of 47 years, 33 years, 21 years and 26 years, respectively.

•  Maximize Operational Control.  We seek to operate our properties and maintain a substantial working interest. We believe the ability to control our drilling inventory will provide us with the opportunity to more efficiently allocate capital, manage resources, control operating and development costs, and utilize our experience and knowledge of oilfield technologies.

•  Pursue Selective Acquisitions and Joint Ventures.  Due to our local presence in Eastern Kansas and strategic partnership with Haas Petroleum, we believe we are well-positioned to pursue selected acquisitions from the fragmented and capital-constrained owners of mineral rights throughout Eastern Kansas.

•  Reduce Unit Costs Through Economies of Scale and Efficient Operations.  As we continue to increase our oil production and develop our existing properties, we expect that our unit cost structure will benefit from economies of scale. In particular, we anticipate reducing unit costs by greater utilization of our existing infrastructure over a larger number of wells.

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Our Competitive Strengths

We have a number of strengths that we believe will help us successfully execute our strategy:

•  Acquisition and Development Strategy.  We have what we believe to be a relatively low-risk acquisition and development strategy compared to some of our competitors. We generally buy properties that have proven, long-term production, with a projected pay-back within a relatively short period of time, and with potential growth and upside in terms of development, enhancement and efficiency. We also plan to minimize the risk of natural gas and oil price volatility by developing a sales portfolio of pricing for our production as we continue to expand and as market conditions permit.

•  Significant Production Growth Opportunities.  We have acquired an attractive acreage position with favorable lease terms in a region with historical hydrocarbon production. Based on continued drilling success within our acreage position, we expect to increase our reserves, production and cash flow.

•  Experienced Management Team and Strategic Partner with Strong Technical Capability.  Our CEO has over 20 years of experience in the energy industry, primarily related to gas/electric utilities, but including experience related to energy trading and production, and members of our board of directors have considerable industry experience and technical expertise in engineering, horizontal drilling, geoscience and field operations. In addition, our strategic partner, Haas Petroleum, has over 70 years of experience in Eastern Kansas, including completion and secondary recovery techniques and technologies. Our board of directors and Mark Haas of Haas Petroleum work closely with management during the initial phases of any major project to ensure its feasibility and to consider the appropriate recovery techniques to be utilized.

•  Incentivized Management Ownership.  The equity ownership of our directors and executive officers is strongly aligned with that of our stockholders. As of September 2, 2008, our directors and executive officers owned approximately 9.1% of our outstanding common stock, with options that upon exercise would increase their ownership of our outstanding common stock to 18.8%. In addition, the compensation arrangements for our directors and executive officers are weighted toward future performance-based equity awards rather than cash payments.

Company History

Midwest Energy, Inc. was incorporated in the state of Nevada on December 30, 2005. Prior to the reverse merger with Midwest Energy in August of 2006, we operated under the name Millennium Plastics Corporation and focused on the development of biodegradable plastic materials. This business plan was ultimately abandoned following its unsuccessful implementation. Following the merger, we assumed the business plan of Midwest Energy and entered into the oil and natural gas industry. Concurrent with the effectiveness of the merger, we changed our name to “EnerJex Resources, Inc.” The result of the merger was that the former stockholders of Midwest Energy controlled approximately 98% of our outstanding shares of common stock. In addition, Midwest Energy was deemed to be the acquiring company for financial reporting purposes and the merger was accounted for as a reverse merger. In November 2007 Midwest Energy changed its name to EnerJex Kansas. All of our current operations are conducted through EnerJex Kansas and DD Energy, our wholly-owned subsidiaries.

Significant Developments in Fiscal 2008 and Fiscal 2009 to Date

The following is a brief description of our most significant corporate developments that have occurred in fiscal 2008 and fiscal 2009 to date:

•  In April and June 2007, we completed a financing in which we issued debentures and 9,000,000 shares of our common stock in return for $6.3 million (before expenses and placement fees) at the first closing and an additional $2.7 million at the second closing.

•  In April 2007, we acquired the Black Oaks Project for $4.0 million, with the requirement to spend additional funds to fully complete the development of the Black Oaks Project.

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•  In April 2007, Phase I of the Black Oaks Project development plan commenced with the drilling of 44 in-fill wells.

•  In April 2007, we acquired the 240 acre Thoren Project in Douglas County, Kansas from MorMeg for $400,000.

•  In August 2007, we entered into the Development Agreement with Euramerica, pursuant to which we granted to Euramerica the right to purchase an interest in the Gas City Project for $1.2 million.

•  In September 2007, we acquired the DD Energy Project, located in Johnson, Anderson and Linn Counties of Kansas, for $2.7 million.

•  In September 2007, we acquired the Tri-County Project, located in Miami, Johnson and Franklin Counties, Kansas, for $800,000.

•  Our estimated total proved oil reserves increased from zero as of March 31, 2007 to 1.4 million BOE as of March 31, 2008.

•  According to a reserve report prepared by McCune Engineering P.E., our independent reserve engineer, the total proved PV 10 (present value) of reserves before tax as of March 31, 2008 was $39.6 million. See “Glossary” on page 80 for our definition of PV10 and see “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.

•  In March 2008, we entered into the Shell agreement whereby we agreed to an 18-month fixed-price swap with Shell for 130 BOPD beginning on April 1, 2008 at a fixed price per barrel of $96.90, less transportation costs. This represented approximately 60% of our total current oil production on a net revenue basis at that time and locked in approximately $6.8 million in gross revenue before the deduction of transportation costs over the 18 month period. In addition, we agreed to sell all of our remaining oil production at current spot market pricing beginning April 1, 2008 through September 30, 2009 to Shell.

•  Our in-fill drilling and waterflood enhanced recovery techniques at the Black Oaks Project have increased gross oil production to approximately 106 Barrels on August 26, 2008 from a level of an average of approximately 32 BOEPD per day when the project was originally acquired. As of June 30, 2008, the Black Oaks Project had 63 active production wells and 13 active water injection wells, an increase of 28 production wells and 13 water injection wells since the project was originally acquired. Based upon these results, we anticipate commencing Phase II of the development plan, which contemplates drilling over 25 additional water injection wells and completing over 20 additional producer wells.

•  In June 2008, we received our second payment of $300,000 from Euramerica related to its option exercise for the Gas City Project. To date, Euramerica has paid $600,000 of the $1.2 million purchase price and $500,000 of the $2.0 million development funds. Upon payment of the entire purchase price, Euramerica will be assigned a 95% working interest and we will retain a 5% carried working interest before payout. When the project reaches payout, our 5% carried working interest will increase to a 25% working interest and Euramerica will have a 75% working interest.

•  For the three months ended June 30, 2008, oil and natural gas revenues were $1.69 million. We achieved positive income from operations of $24,710 for the quarter for the first time in our history. Cash flow from operations for the quarter totaled $351,045. The net loss for the quarter was $631,800 and included non-cash charges for stock-based compensation, depletion, accretion and certain loan costs totaling $831,286.

•  On July 3, 2008, we entered a new three-year $50 million senior secured credit facility with Texas Capital Bank, N. A. with an initial borrowing base of $10.75 million based on our current proved oil and natural gas reserves. We used our initial borrowing under this facility of $10.75 million to redeem an aggregate principal amount of $6.3 million of our 10% debentures, assign approximately $2.0 million of our existing indebtedness with another bank to this facility, repay $965,000 of seller-

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financed notes, pay the transaction costs, fees and expenses of this new facility, and expand current development projects, including completion of newly drilled oil wells.

•  As of July 3, 2008, we entered into an ISDA master agreement and a costless collar with BP Corporation North America Inc., or BP, for 130 BOPD with a price floor of $132.50 per barrel and a price ceiling of $155.70 per barrel for NYMEX West Texas Intermediate for the period of October 1, 2009 until March 31, 2011.

•  On July 7, 2008, we amended the $2.7 million of aggregate principal amount of our 10% debentures that remain outstanding to, among other things, permit the indebtedness under our new credit facility, subordinate the security interests of the debentures to the new credit facility, provide for the redemption of the remaining debentures with the net proceeds from our next debt or equity offering and eliminate the covenant to maintain certain production thresholds.

•  On August 1, 2008, we entered into three-year employment agreements with C. Stephen Cochennet, our president and chief executive officer, and Dierdre P. Jones, our chief financial officer.

•  On August 8, 2008, we entered into a five year lease for corporate office space beginning September 1, 2008.

•  On August 26, 2008 our gross production was approximately 325 Barrels, broken out for each of our projects approximately as follows: Black Oaks — 106 Barrels; DD Energy — 92 Barrels; Tri-County — 62 Barrels; Thoren — 48 Barrels; and Gas City — 17 Barrels.

Relationship with Haas Petroleum

In April 2007, we entered into a consulting agreement with Mark Haas, President of Haas Petroleum and managing member of MorMeg. This agreement provides that Mr. Haas will consult with us at an executive level regarding field development, acquisition evaluation, identification of additional acquisition opportunities and overall business strategy. Haas Petroleum has been in the oil exploration and production business for over 70 years and Mr. Haas has been in the business for over 30 years.

We believe that this relationship provides us with a competitive advantage when evaluating and sourcing acquisition opportunities. As a long term producer and oil field service provider, Haas Petroleum has existing relationships with numerous oil and natural gas producers in Eastern Kansas and is generally aware of existing opportunities to enhance many of these properties through the deployment of capital, and application of enhanced drilling and production technologies. We believe that we will be able to leverage the experience and relationships of Mr. Haas to compliment our business strategy. To date, Mr. Haas has helped us identify and evaluate all of our property acquisitions, and has been instrumental in the creation and implementation of our development plans of these properties.

One of our fundamental goals with respect to the consulting arrangement is to align the interests of Mr. Haas with those of ours as much as possible. As a result, the consulting agreement provides that we will pay him five thousand dollars per month. In addition, we have granted Mr. Haas options to purchase 60,000 shares of our common stock at an exercise price of $6.25 per share, expiring on May 3, 2011. Finally, we have utilized our common stock, in part, for the purchase of assets owned by MorMeg, which we believe will further align our business interests with those of Mr. Haas.

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Drilling Activity

The following table sets forth the results of our drilling activities during the 2006, 2007 and 2008 fiscal years and the first quarter of fiscal 2009.

	Drilling Activity
	Gross Wells						Net Wells(1)
Period	Total		Producing		Dry		Total		Producing		Dry
Fiscal 2006 Exploratory		-0-		-0-		-0-		-0-		-0-		-0-
Fiscal 2007 Exploratory		-0-		-0-		-0-		-0-		-0-		-0-
Fiscal 2008 Exploratory(2)		10		10		-0-		10		10		-0-
First Quarter Fiscal 2009 Exploratory(2)		12		12		-0-		12		12		-0-
Fiscal 2006 Development		-0-		-0-		-0-		-0-		-0-		-0-
Fiscal 2007 Development		-0-		-0-		-0-		-0-		-0-		-0-
Fiscal 2008 Development		59		57		2		58		56		2
First Quarter Fiscal 2009 Development		9		9		-0-		9		9		-0-

(1)	Net wells are based on our net working interest as of June 30, 2008.
(2)	We incurred no exploration costs related to exploratory wells in which we held carried working interest.

Net Production, Average Sales Price and Average Production and Lifting Costs

The following table sets forth our net oil and natural gas production (net of all royalties, overriding royalties and production due to others) for the three months ended June 30, 2008, the fiscal years ended March 31, 2008 and 2007 and the period from inception (December 30, 2005) through March 31, 2006, the average sales prices, average production costs and direct lifting costs per unit of production.

							Period From
							Inception (December 30,
	Three Months Ended		Fiscal Year Ended		Fiscal Year Ended		2005) through
	June 30,		March 31,		March 31,		March 31,
	2008		2008		2007		2006
Net Production
Oil (Bbl)		17,884		43,697		-0-		-0-
Natural gas (Mcf)		6,194		17,762		19,254		-0-
Average Sales Prices
Oil (per Bbl)	$	100.51	$	79.71	$	-0-	$	-0-
Natural gas (per Mcf)	$	8.61	$	6.20	$	4.72	$	-0-
Average Production Cost(1)
Per Bbl of oil	$	53.49	$	56.65	$	-0-	$	-0-
Per McF of natural gas	$	20.70	$	13.12	$	9.55	$	-0-
Average Lifting Costs(2)
Per Bbl of oil	$	33.92	$	37.08	$	-0-	$	-0-
Per McF of natural gas	$	17.44	$	9.86	$	8.95	$	-0-

(1)	Production costs include all operating expenses, depreciation, depletion and amortization, lease operating expenses and all associated taxes. Impairment of oil and natural gas properties is not included in production costs.
(2)	Direct lifting costs do not include impairment expense or depreciation, depletion and amortization.

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Results of Oil and Natural Gas Producing Activities

The following table shows the results of operations from our oil and natural gas producing activities from inception (December 30, 2005) through June 30, 2008. Results of operations from these activities have been determined using historical revenues, production costs, depreciation, depletion and amortization of the capitalized costs subject to amortization. General and administrative expenses and interest expense have been excluded from this determination.

										From Inception
										(December 30,
	For the Three			For the Fiscal			For the Fiscal			2005)
	Months Ended			Year Ended			Year Ended			through
	June 30,			March 31,			March 31,			March 31,
	2008			2008			2007			2006
Production revenues	$	1,690,086		$	3,602,798		$	90,800		$	2,142
Production costs		714,534			(1,795,188	)		(172,417	)		(14,599	)
Depreciation, depletion and amortization		(370,190	)		(913,224	)		(11,477	)		(385	)
Results of operations for producing activities	$	605,362		$	894,386		$	(93,094	)	$	(12,842	)

Producing Wells

The following table sets forth the number of productive oil and natural gas wells in which we owned an interest as of June 30, 2008.

	Producing
					Gross		Net
Project	Gross Oil		Net Oil(1)		Natural Gas		Natural Gas(1)
Black Oaks Project(2)		63		60		-0-		-0-
DD Energy Project		113		113		-0-		-0-
Tri-County Project		170		170		-0-		-0-
Thoren Project		33		33		-0-		-0-
Gas City Project		2		2		15		15
Total		381		378		15		15

(1) Net wells are based on our net working interest as of June 30, 2008.

(2) Following completion of the Black Oaks Project, or upon mutual agreement with MorMeg, we will have the option to develop the approximate 2,100 acre “Nickel Town Project.”

Reserves

Our estimated total proved PV 10 (present value) of reserves as of March 31, 2008 increased to $39.6 million from zero as of March 31, 2007. We developed total proved reserves to 1.4 million BOE. Of the 1.4 million BOE, approximately 64% are proved developed and approximately 36% are proved undeveloped. The proved developed reserves consist of proved developed producing (82%) and proved developed non-producing (18%). See “Glossary” on page 80 for our definition of PV10.

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Based on an assumed oil price of $94.53 per barrel and $7.479 per Mcf for natural gas as of March 31, 2008, and applying an annual discount rate of 10% of the future net cash flow, the estimated PV10 of the 1.4 million BOE, before tax, is calculated as set forth in the following table:

	Gross		Net		Gross		Net		PV10(5)
Proved Reserves Category	STB(1)		STB(2)		MCF(3)		MCF(4)		(before tax)
Proved, Developed Producing		1,034,163		746,169		141,371		114,610	$	22,750,447
Proved, Developed Non-Producing		141,900		115,071		350,000		286,587	$	5,446,999
Proved, Undeveloped		705,750		510,974		-0-		-0-	$	11,413,886
Total Proved		1,881,813		1,372,214		491,371		401,197	$	39,611,332

(1)	STB = one stock-tank barrel.
(2)	Net STB is based upon our net revenue interest.
(3)	MCF = thousand cubic feet of natural gas.
(4)	Net MCF is based upon our net revenue interest.
(5)	The following table shows our reconciliation of our PV10 to our standardized measure of discounted future net cash flows (the most direct comparable measure calculated and presented in accordance with GAAP). PV10 is our estimate of the present value of future net revenues from estimated proved natural gas reserves after deducting estimated production and ad valorem taxes, future capital costs and operating expenses, but before deducting any estimates of future income taxes. The estimated future net revenues are discounted at an annual rate of 10% to determine their “present value.” We believe PV10 to be an important measure for evaluating the relative significance of our oil and natural gas properties and that the presentation of the non-GAAP financial measure of PV10 provides useful information to investors because it is widely used by professional analysts and sophisticated investors in evaluating oil and gas companies. Because there are many unique factors that can impact an individual company when estimating the amount of future income taxes to be paid, we believe the use of a pre-tax measure is valuable for evaluating our company. We believe that most other companies in the oil and gas industry calculate PV10 on the same basis. PV10 should not be considered as an alternative to the standardized measure of discounted future net cash flows as computed under GAAP.

	As of
	March 31,
	2008
PV10	$	39,611,332
Future income taxes, discounted at 10%		(11,410,779	)
Standardized measure of discounted future net cash flows	$	28,200,553

Oil and Natural Gas Reserves Reported to Other Agencies

We did not file any estimates of total proved net oil or natural gas reserves with, or include such information in reports to, any federal authority or agency, other than the SEC, since the beginning of the fiscal year ending March 31, 2008.

Title to Properties

Our properties are subject to customary royalty interests, liens under indebtedness, liens incident to operating agreements and liens for current taxes and other burdens, including mineral encumbrances and restrictions. Further, our debt is secured by liens on substantially all of our assets. We do not believe that any of these burdens materially interferes with the use of our properties in the operation of our business.

We believe that we have satisfactory title to or rights in all of our producing properties. As is customary in the natural gas and oil industry, minimal investigation of title is made at the time of acquisition of undeveloped properties. In most cases, we investigate title and obtain title opinions from counsel or have title

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reviewed by professional landmen only when we acquire producing properties or before we begin drilling operations. However, any acquisition of producing properties without obtaining title opinions are subject to a greater risk of title defects.

Sale of Natural Gas and Oil

We do not intend to refine our natural gas or oil production. We expect to sell all or most of our production to a small number of purchasers in a manner consistent with industry practices at prevailing rates by means of long-term and short-term sales contracts, some of which may have fixed price components. We have a long-term purchase contract with Shell to sell all of our current oil production beginning April 1, 2008 through September 2009. Under current conditions, we should be able to find other purchasers, if needed. All of our produced oil is held in tank batteries and then each respective purchaser transports the oil by truck to the refinery. In addition, our board of directors has implemented a crude oil and natural gas hedging strategy that will allow management to hedge up to 80% of our net production in an effort to mitigate a majority of our exposure to changing oil prices in the intermediate term.

Secondary Recovery and Other Production Enhancement Strategies

When an oil field is first produced, the oil typically is recovered as a result of natural pressure within the producing formation, often assisted by pumps of various types. The only natural force present to move the crude oil to the wellbore is the pressure differential between the higher pressure in the formation and the lower pressure in the wellbore. At the same time, there are many factors that act to impede the flow of crude oil, depending on the nature of the formation and fluid properties, such as pressure, permeability, viscosity and water saturation. This stage of production is referred to as “primary production,” which in Eastern Kansas normally only recovers up to 15% of the crude oil originally in place in a producing formation.

Many, but not all, oil fields are amenable to assistance from a waterflood, a form of “secondary recovery,” which is used to maintain reservoir pressure and to help sweep oil to the wellbore. In a waterflood, certain wells are used to inject water into the reservoir while other wells are used to recover the oil in place. We are employing a waterflood for the Black Oaks Project as well as on our remaining shallow oil leases. We anticipate waterflooding to be our secondary recovery technique for the majority of our oil field projects.

As the waterflood matures, the fluid produced contains increasing amounts of water and decreasing amounts of oil. Surface equipment is used to separate the oil from the water, with the oil going to pipelines or holding tanks for sale and the water being recycled to the injection facilities. In the Black Oaks Project, through June 30, 2008 we have realized an increase of four barrels a day to 18 barrels a day in oil production on four wells as a result of the waterflood.

In addition, we may utilize 3-D seismic analysis, horizontal drilling, and other technologies and production techniques to improve drilling results and ultimately enhance our production and returns. We also believe use of such technologies and production techniques in exploring for, developing and exploiting oil and natural gas properties will help us reduce drilling risks, lower finding costs and provide for more efficient production of oil and natural gas from our properties.

Markets and Marketing

The natural gas and oil industry has experienced rising and volatile prices in recent years. As a commodity, global natural gas and oil prices respond to macro-economic factors affecting supply and demand. In particular, world oil prices have risen in response to political unrest and supply uncertainty in Iraq, Venezuela, Nigeria and Iran, and increasing demand for energy in rapidly growing economies, notably India and China. Due to rising world prices and the consequential impact on supply, North American prospects have become more attractive. Escalating conflicts in the Middle East and the ability of OPEC to control supply and pricing are some of the factors negatively impacting the availability of global supply. In contrast, increased costs of steel and other products used to construct drilling rigs and pipeline infrastructure, as well as higher drilling and well-servicing rig rates, negatively impact domestic supply.

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Our market is affected by many factors beyond our control, such as the availability of other domestic production, commodity prices, the proximity and capacity of natural gas and oil pipelines, and general fluctuations of global and domestic supply and demand. Although we have entered into one sales contract with Shell at this time, we do not anticipate difficulty in finding additional sales opportunities, as and when needed.

Natural gas and oil sales prices are negotiated based on factors such as the spot price for natural gas or posted price for oil, price regulations, regional price variations, hydrocarbon quality, distances from wells to pipelines, well pressure, and estimated reserves. Many of these factors are outside our control. Natural gas and oil prices have historically experienced high volatility, related in part to ever-changing perceptions within the industry of future supply and demand.

Competition

The natural gas and oil industry is intensely competitive and, as an early-stage company, we must compete against larger companies that may have greater financial and technical resources than we do and substantially more experience in our industry. These competitive advantages may better enable our competitors to sustain the impact of higher exploration and production costs, natural gas and oil price volatility, productivity variances between properties, overall industry cycles and other factors related to our industry. Their advantage may also negatively impact our ability to acquire prospective properties, develop reserves, attract and retain quality personnel and raise capital.

Research and Development Activities

We have not spent any material amount of time in the last two fiscal years on research and development activities.

Governmental Regulations

Regulation of Oil and Natural Gas Production.  Our oil and natural gas exploration, production and related operations, when developed, are subject to extensive rules and regulations promulgated by federal, state, tribal and local authorities and agencies. For example, some states in which we may operate, including Kansas, require permits for drilling operations, drilling bonds and reports concerning operations and impose other requirements relating to the exploration and production of oil and natural gas. Such states may also have statutes or regulations addressing conservation matters, including provisions for the unitization or pooling of oil and natural gas properties, the establishment of maximum rates of production from wells, and the regulation of spacing, plugging and abandonment of such wells. Failure to comply with any such rules and regulations can result in substantial penalties. Moreover, such states may place burdens from previous operations on current lease owners, and the burdens could be significant. The regulatory burden on the oil and natural gas industry will most likely increase our cost of doing business and may affect our profitability. Although we believe we are currently in substantial compliance with all applicable laws and regulations, because such rules and regulations are frequently amended or reinterpreted, we are unable to predict the future cost or impact of complying with such laws. Significant expenditures may be required to comply with governmental laws and regulations and may have a material adverse effect on our financial condition and results of operations.

Federal Regulation of Natural Gas.  The Federal Energy Regulatory Commission, or FERC, regulates interstate natural gas transportation rates and service conditions, which may affect the marketing of natural gas produced by us, as well as the revenues that may be received by us for sales of such production. Since the mid-1980’s, FERC has issued a series of orders, culminating in Order Nos. 636, 636-A and 636-B, or Order 636, that have significantly altered the marketing and transportation of natural gas. Order 636 mandated a fundamental restructuring of interstate pipeline sales and transportation service, including the unbundling by interstate pipelines of the sale, transportation, storage and other components of the city-gate sales services such pipelines previously performed. One of FERC’s purposes in issuing the order was to increase competition within all phases of the natural gas industry. The United States Court of Appeals for the District of Columbia Circuit largely upheld Order 636 and the Supreme Court has declined to hear the appeal from that decision.

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Generally, Order 636 has eliminated or substantially reduced the interstate pipelines’ traditional role as wholesalers of natural gas in favor of providing only storage and transportation service, and has substantially increased competition and volatility in natural gas markets.

The price we may receive from the sale of oil and natural gas liquids will be affected by the cost of transporting products to markets. Effective January 1, 1995, FERC implemented regulations establishing an indexing system for transportation rates for oil pipelines, which, generally, would index such rates to inflation, subject to certain conditions and limitations. We are not able to predict with certainty the effect, if any, of these regulations on our intended operations. However, the regulations may increase transportation costs or reduce well head prices for oil and natural gas liquids.

Environmental Matters

Our operations and properties are subject to extensive and changing federal, state and local laws and regulations relating to environmental protection, including the generation, storage, handling, emission, transportation and discharge of materials into the environment, and relating to safety and health. The recent trend in environmental legislation and regulation generally is toward stricter standards, and this trend will likely continue.

These laws and regulations may:

•  require the acquisition of a permit or other authorization before construction or drilling commences and for certain other activities;

•  limit or prohibit construction, drilling and other activities on certain lands lying within wilderness and other protected areas; and

•  impose substantial liabilities for pollution resulting from its operations, or due to previous operations conducted on any leased lands.

The permits required for our operations may be subject to revocation, modification and renewal by issuing authorities. Governmental authorities have the power to enforce their regulations, and violations are subject to fines or injunctions, or both. In the opinion of management, we are in substantial compliance with current applicable environmental laws and regulations, and have no material commitments for capital expenditures to comply with existing environmental requirements. Nevertheless, changes in existing environmental laws and regulations or in interpretations thereof could have a significant impact on us, as well as the oil and natural gas industry in general.

The Comprehensive Environmental, Response, Compensation, and Liability Act, as amended, or CERCLA, and comparable state statutes impose strict, joint and several liability on owners and operators of sites and on persons who disposed of or arranged for the disposal of “hazardous substances” found at such sites. It is not uncommon for the neighboring land owners and other third parties to file claims for personal injury and property damage allegedly caused by the hazardous substances released into the environment. The Federal Resource Conservation and Recovery Act, as amended, or RCRA, and comparable state statutes govern the disposal of “solid waste” and “hazardous waste” and authorize the imposition of substantial fines and penalties for noncompliance. Although CERCLA currently excludes petroleum from its definition of “hazardous substance,” state laws affecting our operations may impose clean-up liability relating to petroleum and petroleum related products. In addition, although RCRA classifies certain oil field wastes as “non-hazardous,” such exploration and production wastes could be reclassified as hazardous wastes thereby making such wastes subject to more stringent handling and disposal requirements.

The Federal Water Pollution Control Act of 1972, as amended, or Clean Water Act, and analogous state laws impose restrictions and controls on the discharge of pollutants into federal and state waters. These laws also regulate the discharge of storm water in process areas. Pursuant to these laws and regulations, we are required to obtain and maintain approvals or permits for the discharge of wastewater and storm water and develop and implement spill prevention, control and countermeasure plans, also referred to as “SPCC plans,” in connection with on-site storage of greater than threshold quantities of oil. The EPA issued revised SPCC

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rules in July 2002 whereby SPCC plans are subject to more rigorous review and certification procedures. We believe that our operations are in substantial compliance with applicable Clean Water Act and analogous state requirements, including those relating to wastewater and storm water discharges and SPCC plans.

The Endangered Species Act, as amended, or ESA, seeks to ensure that activities do not jeopardize endangered or threatened animal, fish and plant species, nor destroy or modify the critical habitat of such species. Under ESA, exploration and production operations, as well as actions by federal agencies, may not significantly impair or jeopardize the species or its habitat. ESA provides for criminal penalties for willful violations of the Act. Other statutes that provide protection to animal and plant species and that may apply to our operations include, but are not necessarily limited to, the Fish and Wildlife Coordination Act, the Fishery Conservation and Management Act, the Migratory Bird Treaty Act and the National Historic Preservation Act. Although we believe that our operations will be in substantial compliance with such statutes, any change in these statutes or any reclassification of a species as endangered could subject us to significant expenses to modify our operations or could force us to discontinue certain operations altogether.

Personnel

As of June 30, 2008, we had 19 full time employees, an increase from 9 full time employees at our fiscal year ended March 31, 2008. We hired a number of former independent field contractors to help secure a more stable work base. We have not experienced a material increase in expenses from this initiative, as most of these individuals were already included in our current operating and capital expenses as independent contractors. As drilling and production activities increase, we intend to hire additional technical, operational and administrative personnel as appropriate. We are using and will continue to use the services of independent consultants and contractors to perform various professional services, particularly in the area of land services, reservoir engineering, drilling, water hauling, pipeline construction, well design, well-site monitoring and surveillance, permitting and environmental assessment. We believe that this use of third-party service providers may enhance our ability to contain general and administrative expenses.

Legal Proceedings

We may become involved in various routine legal proceedings incidental to our business. However, to our knowledge as of the date of this prospectus, there are no material pending legal proceedings to which we are a party or to which any of our property is subject.

Facilities

We currently maintain an office at 7300 W. 110th Street, 7th floor, Overland Park, Kansas 66210. This space was leased pursuant to a one year agreement that expired on July 31, 2008. On August 8, 2008, we entered into a five year lease for corporate office space beginning September 1, 2008. We will remain in our current office space during the interim period.

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MANAGEMENT

The following table sets forth certain information regarding our current directors and executive officers. Our directors and executive officers serve one-year terms.

Name	Age		Position	Board Committees(1)
C. Stephen Cochennet		51	President, Chief Executive Officer and Chairman	None
Dierdre P. Jones		44	Chief Financial Officer	None
Robert G. Wonish		54	Director	GCNC (Chairman) and Audit
Daran G. Dammeyer		47	Director	Audit (Chairman) and GCNC
Darrel G. Palmer		50	Director	GCNC
Dr. James W. Rector		47	Director	None

(1)  “GCNC” means Governance, Compensation and Nominating Committee of the Board of Directors. “Audit” means the Audit Committee of the Board of Directors.

C. Stephen Cochennet has been our president, chief executive officer and chairman since August 15, 2006. From July 2002 to present, Mr. Cochennet has been president of CSC Group, LLC. Mr. Cochennet formed the CSC Group, LLC through which he supports a number of clients that include Fortune 500 corporations, international companies, natural gas/electric utilities, outsource service providers, as well as various start up organizations. The services provided include strategic planning, capital formation, corporate development, executive networking and transaction structuring. Mr. Cochennet currently spends less than 10 hours a month on activities associated with CSC Group, LLC. From 1985 to 2002, he held several executive positions with UtiliCorp United Inc. (Aquila) in Kansas City. His responsibilities included finance, administration, operations, human resources, corporate development, natural gas/energy marketing, and managing several new start up operations. Prior to his experience at UtiliCorp United Inc., Mr. Cochennet served 6 years with the Federal Reserve System. Mr. Cochennet graduated from the University of Nebraska with a B.A. in Finance and Economics.

Dierdre P. Jones has been our chief financial officer since August 1, 2008. From August 2007 through July 2008 Ms. Jones served as our director of finance and accounting. From May 2007 through August 2007, Ms. Jones provided independent consulting services for the company, primarily in the testing and implementation of financial accounting and reporting software. From May 2002 through May 2007, Ms. Jones was sole proprietor of These Faux Walls, a specialty design company. She holds the professional designations of Certified Public Accountant and Certified Internal Auditor. Prior to joining EnerJex, Ms. Jones held management positions with UtiliCorp United Inc. (Aquila), and served three years in public accounting with Arthur Andersen & Co. Ms. Jones graduated with distinction from the University of Kansas with a B.S. in Accounting and Business Administration.

Robert G. Wonish has served as a member of our board of directors since May 2007. Effective April 21, 2008, Mr. Wonish was appointed as president and chief operating officer of Striker Oil & Gas, Inc. (OTC:BB SOIS), which is an oil and natural gas exploration and production company. Mr. Wonish also serves on the board of directors of Striker Oil & Gas, Inc. From December 2004 to June 30, 2007, Mr. Wonish was vice president of Petroleum Engineers Inc., a subsidiary of The CYMRI Corporation, now CYMRI, L.L.C., which is a wholly-owned subsidiary of Stratum Holdings, Inc. On July 1, 2007, Mr. Wonish was appointed president and chief operating officer of Petroleum Engineers Inc. Mr. Wonish was also president of CYMRI, L.L.C. After the sale of Petroleum Engineers Inc. in March of 2008, Mr. Wonish resigned all positions in Petroleum Engineers Inc. and CYMRI, L.L.C. as well as resigning as a member of the Stratum Holdings, Inc. board of directors. He previously achieved positions of increasing responsibility with PANACO, Inc., a public oil and natural gas company, ultimately serving as that company’s president and chief operating officer. He began his engineering career at Amoco in 1975 and joined Panaco’s engineering staff in 1992. Mr. Wonish received his Mechanical Engineering degree from the University of Missouri-Rolla.

Daran G. Dammeyer has served as a member of our board of directors since May 2007. Since July 1999, Mr. Dammeyer has served as president of D-Two Solutions through which he supports clients by primarily

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providing merger and acquisition support, strategic planning, budgeting and forecasting process development and implementation. From March 1999 through July 1999, Mr. Dammeyer was a Director of International Financial Management for UtiliCorp United Inc. (Aquila), a multinational energy solutions provider in Kansas City, Missouri. From November 1995 through March 1999, Mr. Dammeyer served as the chief financial controller of United Energy Limited in Melbourne, Australia. Mr. Dammeyer also served in numerous management positions at Michigan Energy Resources Company, including director of internal audit. Mr. Dammeyer earned his Bachelor of Business Administration degree, with dual majors in Accounting and Corporate Financial Management from The University of Toledo, Ohio.

Darrel G. Palmer has served as a member of our board of directors since May 2007. Since January 1997, Mr. Palmer has been president of Energy Management Resources, an energy process management firm serving industrial and large commercial companies throughout the U.S. and Canada. Mr. Palmer has 25 years of expertise in the natural gas arena. His experiences encompass a wide area of the natural gas industry and include working for natural gas marketing companies, local distribution companies, and FERC regulated pipelines. Prior to becoming an independent energy consultant in 1997, Mr. Palmer’s last position was vice president/national account sales at UtiliCorp United Inc. (Aquila) of Kansas City, Missouri. Over the years Mr. Palmer has worked in many civic organizations including United Way and has been a president of the local Kiwanis Club. Junior Achievement of Minnesota awarded him the Bronze Leadership Award for his accomplishments which included being an advisor, program manager, holding various board positions, and ultimately being board president.

Dr. James W. Rector has served as a member of our board of directors since March 2008. Dr. Rector is the author of numerous technical papers along with a number of patents on seismic technology. He was a co-founder of two seismic technology startups that were later sold to NYSE-listed companies, and he regularly consults for many of the major oil companies including Chevron and BP. In 1998, he founded Berkeley GeoImaging LLC, which has completed five equity private placements for oil and natural gas exploration and development projects. Dr. Rector is a tenured professor of Geophysics at the University of California at Berkeley and a faculty staff scientist at the Lawrence Berkeley National Laboratory. He has been the Editor-in-Chief of the Journal of Applied Geophysics and has also served on the Society of Exploration Geophysicists Executive Committee. He received his Masters and Ph.D. degrees in Geophysics from Stanford University.

Board of Directors

Our board of directors currently consists of five members. Our directors serve one-year terms. Our board of directors has affirmatively determined that Messrs. Wonish, Dammeyer, Palmer and Dr. Rector are independent directors, as defined by Section 803 of the American Stock Exchange Company Guide.

Committees of the Board of Directors

Our board of directors has two standing committees: an audit committee and a governance, compensation and nominating committee. Each of those committees has the composition and responsibilities set forth below.

Audit Committee

On May 4, 2007, we established and appointed initial members to the audit committee of our board of directors. Mr. Dammeyer is the chairman and Mr. Wonish serves as the other member of the committee. Currently, none of the members of the audit committee are, or have been, our officers or employees, and each member qualifies as an independent director as defined by Section 803 of the American Stock Exchange Company Guide and Section 10A(m) of the Securities Exchange Act of 1934, and Rule 10A-3 thereunder. The board of directors has determined that Mr. Dammeyer is an “audit committee financial expert” as that term is used in Item 401(h) of Regulation S-K promulgated under the Securities Exchange Act. The audit committee held ten meetings during fiscal 2008.

The audit committee has the sole authority to appoint and, when deemed appropriate, replace our independent registered public accounting firm, and has established a policy of pre-approving all audit and permissible non-audit services provided by our independent registered public accounting firm. The audit

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committee has, among other things, the responsibility to evaluate the qualifications and independence of our independent registered public accounting firm; to review and approve the scope and results of the annual audit; to review and discuss with management and the independent registered public accounting firm the content of our financial statements prior to the filing of our quarterly reports and annual reports; to review the content and clarity of our proposed communications with investors regarding our operating results and other financial matters; to review significant changes in our accounting policies; to establish procedures for receiving, retaining, and investigating reports of illegal acts involving us or complaints or concerns regarding questionable accounting or auditing matters, and supervise the investigation of any such reports, complaints or concerns; to establish procedures for the confidential, anonymous submission by our employees of concerns or complaints regarding questionable accounting or auditing matters; and to provide sufficient opportunity for the independent auditors to meet with the committee without management present.

Governance, Compensation and Nominating Committee

The governance, compensation and nominating committee is comprised of Messrs. Wonish, Dammeyer and Palmer. Mr. Wonish serves as the chairman of the governance, compensation and nominating committee. The governance, compensation and nominating committee is responsible for, among other things; identifying, reviewing, and evaluating individuals qualified to become members of the board, setting the compensation of the chief executive officer and performing other compensation oversight, reviewing and recommending the nomination of board members, and administering our equity compensation plans. The governance, compensation and nominating committee held five meetings during fiscal 2008.

NON-EMPLOYEE DIRECTOR COMPENSATION

The following table sets forth summary compensation information for the fiscal year ended March 31, 2008 for each of our non-employee directors:

	Fees
	Earned
	or Paid		Stock			Option			All Other
	in Cash		Awards			Awards			Compensation		Total
Name	$		$			$			$		$
Daran G. Dammeyer	$	42,000	$	12,000	(1)	$	171,924	(2)	$	-0-	$	225,924
Darrel G. Palmer	$	14,500	$	-0-		$	171,924	(2)	$	-0-	$	186,424
Robert G. Wonish	$	12,250	$	-0-		$	171,924	(2)	$	-0-	$	184,174
Dr. James W. Rector(3)	$	357	$	-0-		$	-0-		$	-0-	$	357

(1)	Amount represents the estimated total fair market value of 1,920 shares of common stock issued to Mr. Dammeyer for services as audit committee chairman under SFAS 123(R), as discussed in Note 2 to our audited financial statements for the fiscal year ended March 31, 2008.
(2)	Amount represents the estimated total fair market value of 40,000 stock options granted to each of Messrs. Dammeyer, Palmer and Wonish under SFAS 123(R), as discussed in Note 2 to our financial statements for the fiscal year ended March 31, 2008. The 40,000 options granted to Messrs. Dammeyer, Palmer and Wonish were outstanding at fiscal year end.
(3)	Dr. Rector was appointed to the board of directors on March 19, 2008.

Board compensation was recently increased for fiscal 2009 upon the recommendation of an independent compensation consultant and the governance, compensation and nominating committee of the board of directors. The annual retainer for non-employee directors is now $20,000 with a meeting fee of $1,500 for those in attendance and $750 for those who participate by telephone. The chairman of the audit committee will be paid an annual retainer of $42,000, payable with $2,500 per month in cash and $12,000 worth of common stock, which was issued to the chairman on May 15, 2008. Members of the audit committee will be paid an annual cash retainer of $15,000 and $375 per meeting attended. The chairman of the governance, compensation and nominating committee will be paid an annual cash retainer of $8,000, payable quarterly, while members of that committee

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will be paid an annual cash retainer of $2,000, payable quarterly, and $375 per meeting attended. In addition, the directors are reimbursed for expenses incurred in connection with board and committee membership.

For joining the board this fiscal year, Dr. Rector was granted options to purchase 10,000 shares of common stock for three years from the date of grant at an exercise price of $6.25 per share. Each non-employee director was also granted options to purchase 28,000 shares of common stock for three years from the date of grant at an exercise price of $6.25 per share as equity-based compensation for fiscal year 2009.

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EXECUTIVE COMPENSATION

The following table sets forth summary compensation information for the years ended March 31, 2008 and 2007 for our president and chief executive officer. We did not have any other executive officers as of the end of fiscal 2008 whose total compensation exceeded $100,000 and no compensation was paid to Mr. Cochennet in fiscal 2006. We refer to Mr. Cochennet as our named executive officer elsewhere in this prospectus.

Summary Compensation Table

								Option			All Other
	Fiscal		Salary			Bonus		Awards			Compensation			Total
Name and Principal Position	Year		($)			($)		($)			($)			($)
C. Stephen Cochennet		2008	$	156,000			-0-	$	859,622(2	)	$	-0-		$	1,015,622
President and Chief Executive Officer		2007	$	110,500	(1)		-0-		-0-		$	9,500	(3)	$	120,000

(1)	Mr. Cochennet began receiving compensation as of August 1, 2006; therefore the amounts listed for fiscal 2007 represent compensation for only a portion of the year. We agreed to pay Mr. Cochennet a monthly salary of $13,000. Mr. Cochennet received $26,000 as compensation for August 1, 2006 through October 1, 2006. As of October 15, 2006, Mr. Cochennet agreed to defer his salary until financing was secured. As of March 31, 2007, we accrued $84,500 of Mr. Cochennet’s salary. Subsequent to March 31, 2007, Mr. Cochennet’s accrued salary was paid.
(2)	Amount represents the estimated total fair value of stock options granted to Mr. Cochennet under SFAS 123(R).
(3)	Represents automobile maintenance and related costs.

Outstanding Equity Awards at 2008 Fiscal Year-End

The following table lists the outstanding equity incentive awards held by our named executive officer as of March 31, 2008.

Option Awards

Number of

Number of

Number of

Securities

Securities

Securities

Underlying

Underlying

Underlying

Unexercised

Unexercised

Unexercised

Option

Options

Options

Unearned

Exercise

Option

Fiscal Year

Exercisable

Unexercisable

Options

Price

Expiration Date

C. Stephen Cochennet

2008

200,000

-0-

-0-

$

6.25

05/03/2011

Option Exercises for Fiscal 2008

There were no options exercised by our named executive officer in fiscal 2008.

2000/2001 Stock Option Plan

The board of directors approved the 2000/2001 Stock Option Plan and our stockholders ratified the plan on September 25, 2000. The total number of options that can be granted under the plan is 200,000 shares. The options are exercisable for a term of four years at a per share price of $6.25.

Stock Option Plan

The board of directors approved the EnerJex Resources, Inc. Stock Option Plan on August 1, 2002 (the “2002-2003 Stock Option Plan”). Originally, the total number of options that could be granted under the plan was not to exceed 400,000 shares. On May 4, 2007, the governance, compensation and nominating committee amended and restated the stock option plan to rename the plan and to increase the number of shares issuable to 1,000,000. Our stockholders approved this plan in September 2007.

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In no event may the option price with respect to any stock option granted under the 2002-2003 Stock Option Plan be less than the fair market value of such common stock. However the price of an incentive stock option will not be less than 110% of the fair market value per share on the date of the grant in the case of an individual then owning more than 10% of the total combined voting power of all classes of stock of the corporation.

Each option granted under the 2002-2003 Stock Option Plan will be assigned a time period for exercising not to exceed ten years after the date of the grant. Certain other restrictions will apply in connection with this plan when some awards may be exercised.

In the event of a change of control (as defined in the plan), the date on which all options outstanding under the plan may first be exercised will be accelerated. Generally, all options terminate 90 days after a change of control.

General Terms of Stock Option Plans

Officers (including officers who are members of the board of directors), directors, and other employees and consultants and our subsidiaries (if established) will be eligible to receive options under the stock option plans. A committee of the board of directors will administer the stock option plans and will determine those persons to whom options will be granted, the number of options to be granted, the provisions applicable to each grant and the time periods during which the options may be exercised. No options may be granted more than ten years after the date of the adoption of the stock option plans.

Non-qualified stock options will be granted by the committee with an option price equal to the fair market value of the shares of common stock to which the non-qualified stock option relates on the date of grant. The committee may, in its discretion, determine to price the non-qualified option at a different price. In no event may the option price with respect to an incentive stock option granted under the stock option plans be less than the fair market value of such common stock to which the incentive stock option relates on the date the incentive stock option is granted. However the price of an incentive stock option will not be less than 110% of the fair market value per share on the date of the grant in the case of an individual then owning more than 10% of the total combined voting power of all classes of stock of the corporation.

Each option granted under the stock option plans will be exercisable for a term of not more than ten years after the date of grant. Certain other restrictions will apply in connection with the plans when some awards may be exercised. In the event of a change of control (as defined in the stock option plans), the date on which all options outstanding under the stock option plans may first be exercised will be accelerated. Generally, all options terminate 90 days after a change of control.

These plans are intended to encourage directors, officers, employees and consultants to acquire ownership of common stock. The opportunity so provided is intended to foster in participants a strong incentive to put forth maximum effort for our continued success and growth, to aid in retaining individuals who put forth such effort, and to assist in attracting the best available individuals in the future.

Limitation of Liability of Directors

Pursuant to the Nevada General Corporation Law, our articles of incorporation exclude personal liability for our directors for monetary damages based upon any violation of their fiduciary duties as directors, except as to liability for any breach of the duty of loyalty, acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, or any transaction from which a director receives an improper personal benefit. This exclusion of liability does not limit any right which a director may have to be indemnified and does not affect any director’s liability under federal or applicable state securities laws. We have agreed to indemnify our directors against expenses, judgments, and amounts paid in settlement in connection with any claim against a director if he acted in good faith and in a manner he believed to be in our best interests.

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Employment Agreements

On August 1, 2008, we entered into an employment agreement with C. Stephen Cochennet, our president and chief executive officer. Mr. Cochennet’s employment agreement was approved by the governance, compensation and nominating committee of our board of directors.

In general, Mr. Cochennet’s employment agreement contains provisions concerning terms of employment, voluntary and involuntary termination, indemnification, severance payments, and other termination benefits, in addition to a non-compete clause and certain other perquisites, such as long-term disability insurance, director and officer insurance, and an automobile allowance. The original term of Mr. Cochennet’s employment agreement runs from August 1, 2008 until July 31, 2011. The term of the employment agreement is automatically extended for additional one year terms unless otherwise terminated in accordance with its terms.

Mr. Cochennet’s employment agreement provides for an initial annual base salary of $200,000, which may be adjusted by the governance, compensation and nominating committee or our board of directors.

In addition, Mr. Cochennet is eligible to receive an annual bonus of up to 100% of his applicable base salary in cash or shares of restricted stock (if approved by stockholders) subject to our obtaining certain business objectives established by our board of directors. In addition Mr. Cochennet is eligible to receive long-term incentives of up to 135,000 options to purchase shares of our common stock based upon our achievement of specified performance targets. Additional information regarding these options is set forth in the following table.

			Maximum #			Option
Fiscal Year	Grant Date		of Options		Strike Price of Options	Expiration Date*
2009		7/01/09		30,000	Fair market value on grant date		6/30/12
2010		7/01/10		45,000	Fair market value on grant date		6/30/13
2011		7/01/11		60,000	Fair market value on grant date		6/30/14

*  The options shall be immediately vested and exercisable from the grant date through the option expiration date.

The number of stock options granted each fiscal year shall be based upon a schedule set forth in Mr. Cochennet’s employment agreement and will be prorated if actual performance does not equal or exceed 100% of the targeted performance conditions. Mr. Cochennet must be employed by us on the grant date to receive the stock options.

The maximum number of options available to be earned by Mr. Cochennet each year is subject to a “catch-up” provision, such that if an element in year one is missed, it may be “caught-up” in year two, so long as the cumulative goal is met. Any catch-up options will be granted at the then current stock price.

As consideration for his efforts during fiscal 2008 we also agreed to pay Mr. Cochennet a $50,000 cash bonus and grant him 30,000 options to purchase shares of our common stock at $6.25 per share. These options have a term of three years and vest immediately upon grant.

We also granted Mr. Cochennet 45,000 options to purchase shares of our common stock at $6.25 per share as a signing bonus under the employment agreement. These options vest, assuming Mr. Cochennet remains employed by us, based on the following schedule: 10,000 on July 1, 2009; 15,000 on July 1, 2010; and 20,000 on July 1, 2011. The options will be exercisable for a three year term following each respective vesting date.

In the event of a termination of employment with us by Mr. Cochennet for “good reason”, which includes by reason of a “change of control”, or by us without “cause” (each as defined in the employment agreement), Mr. Cochennet would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment; (ii) a lump sum payment equal to the annual incentive amount (assuming achievement at 100% of target) that Mr. Cochennet would have earned if he had remained employed through June 30th following the last day of the current fiscal year; (iii) a lump sum payment equal to an amount equal

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to the lesser of (a) 12-months base salary or (b) the base salary Mr. Cochennet would have received had he remained in employment through the end of the then-existing term of the agreement; and (iv) immediate vesting of all equity awards (including but not limited to stock options and restricted shares).

In the event of a termination of Mr. Cochennet’s employment with us by reason of incapacity, disability or death, Mr. Cochennet, or his estate, would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment or death; (ii) a lump sum payment equal to the annual incentive amount (assuming achievement at 100% of target) that Mr. Cochennet would have earned if he had remained employed through June 30th following the last day of the current fiscal year; and (iii) a lump sum payment equal to an amount equal to six-months base salary.

In the event of a termination of Mr. Cochennet’s employment by us for “cause” (as defined in the employment agreement), Mr. Cochennet would receive all earned but unpaid base salary through the date of termination of employment. However, if a dispute arises between us and Mr. Cochennet that is not resolved within 60 days and neither party initiates arbitration proceedings pursuant to the terms of the employment agreement, we will have the option to pay Mr. Cochennet a lump sum payment equal to six-months base salary in lieu of any and all other amounts or payments to which Mr. Cochennet may be entitled relating to his employment.

On July 23, 2008, Dierdre P. Jones, our former director of finance and accounting, was appointed our chief financial officer. On August 1, 2008, we entered into an employment agreement with Ms. Jones. The employment agreement was approved by the governance, compensation and nominating committee of our board of directors.

In general, Ms. Jones’ employment agreement contains provisions concerning terms of employment, voluntary and involuntary termination, indemnification, severance payments, and other termination benefits, in addition to certain other perquisites. The original term of the employment agreement runs from August 1, 2008 until July 31, 2011.

Ms. Jones’ employment agreement provides for an initial annual base salary of $140,000, which may be adjusted by the governance, compensation and nominating committee or our board of directors.

In addition, Ms. Jones is eligible to receive an annual bonus up to 30% of her applicable base salary and is also eligible to participate in other incentive programs established by us.

We granted Ms. Jones 40,000 options to purchase shares of our common stock at $6.25 per share for a period of three years, which vested immediately upon grant.

In the event of a termination of employment by Jones for “good reason” prior to a “change of control” or by us without “cause” prior to a “change of control” (each as defined in the employment agreement), Ms. Jones would receive: (i) a lump sum payment equal to 12 months of her salary; plus (ii) a lump sum payment equal to the prorated portion of her bonus through the date of termination; plus (iii) all unvested stock or options held by Jones shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements; plus (iv) health insurance premiums for a period of 12 months.

In the event of the termination of Ms. Jones’ employment by us in connection with a “change of control” (as defined in the employment agreement), without cause within 12 months of a “change of control”, or by Ms. Jones for “good reason” within 12 months of a “change of control,” Ms. Jones shall be entitled to: (i) a lump sum payment equal to 12 months of her salary; plus (ii) a lump sum payment equal to 100% of her prior year’s bonus; plus (iii) all unvested stock or options held by Jones shall immediately vest and become exercisable for the full term set forth in such stock option or equity award agreements; plus (iv) health insurance premiums for a period of 12 months.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

We describe below transactions and series of similar transactions that have occurred during fiscal 2009 and during the fiscal years ended March 31, 2008, 2007 and 2006 to which we were a party or will be a party in which:

•  The amounts involved exceeds the lesser of $120,000 or one percent of the average of our total assets at year end for the last two completed fiscal years; and

•  A director, executive officer, holder of more than 5% of our common stock or any member of their immediate family had or will have a direct or indirect material interest.

On March 14, 2006 and July 21, 2006, we paid consulting fees totaling $121,000 in connection with financing activities to Goran Blagojevic, a stockholder.

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PRINCIPAL STOCKHOLDERS

The following table presents information, to the best of our knowledge, about the ownership of our common stock on September 2, 2008 relating to (i) those persons known to beneficially own more than 5% of our capital stock, (ii) our named executive officer, (iii) each director and (iv) our directors and executive officers as a group. The percentage of beneficial ownership for the following table is based on 4,443,467 shares of our common stock outstanding.

Beneficial ownership is determined in accordance with the rules of the SEC and does not necessarily indicate beneficial ownership for any other purpose. Under these rules, beneficial ownership includes those shares of common stock over which the stockholder has sole or shared voting or investment power. It also includes shares of common stock that the stockholder has a right to acquire within 60 days after September 2, 2008 pursuant to options, warrants, conversion privileges or other right. The percentage ownership of the outstanding common stock, however, is based on the assumption, expressly required by the rules of the SEC, that only the person or entity whose ownership is being reported has converted options or warrants into shares of our common stock.

				Percent of Outstanding			Percent of Outstanding
				Shares of Common			Shares of Common
	Number			Stock			Stock
Name of Beneficial Owner, Officer or Director(1)	of Shares			before Offering(2)			after Offering(2)
C. Stephen Cochennet, President & Chief Executive Officer(3)		630,000	(4)		13.5	%		6.5	%
Robert (Bob) G. Wonish, Director(3)		68,000	(5)		1.5	%			*
Darrel G. Palmer, Director(3)		68,000	(5)		1.5	%			*
Daran G. Dammeyer, Director(3)		72,102	(5)		1.6	%			*
Dr. James W. Rector, Director(3)		38,000	(6)		*				*
Directors and Officers as a Group		936,102	(7)		18.8	%		9.4	%
West Coast Opportunity Fund LLC(8)		1,000,000			22.5	%		10.6	%
West Coast Asset Management, Inc. Paul Orfalea, Lance Helfert & R. Atticus Lowe 2151 Alessandro Drive, #100 Ventura, CA 93001
Enable Growth Partners L.P.(9)		385,980			8.7	%		4.1	%
Enable Capital Management, LLC Mitchell S. Levine One Ferry Building, Suite 225 San Francisco, CA 94111

*	Represents beneficial ownership of less than 1%
(1)	As used in this table, “beneficial ownership” means the sole or shared power to vote, or to direct the voting of, a security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of, or to direct the disposition of, a security).
(2)	Figures are rounded to the nearest tenth of a percent. Assumes the issuance of 5,000,000 shares in this offering.
(3)	The address of each person is care of EnerJex: 7300 W. 110th Street, 7th Floor, Overland Park, Kansas 66210.
(4)	Includes 230,000 currently exercisable options.
(5)	Includes 68,000 currently exercisable options.
(6)	Includes 38,000 currently exercisable options.
(7)	Includes 532,000 currently exercisable options held by our executive officers and directors.

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(8)

Based on a Schedule 13G/A filed with the SEC on February 4, 2008. the investment manager of West Coast Opportunity Fund, LLC (“WCOF”) is West Coast Asset Management (“WCAM”). WCAM has the authority to take any and all actions on behalf of WCOF, including voting any shares held by WCOF. Paul Orfalea, Lance Helfert and R. Atticus Lowe constitute the Investment Committee of the WCOF. Messrs. Orfalea, Helfert and Lowe disclaim beneficial ownership of the shares.

(9)

Based on a Schedule 13G/A filed with the SEC on February 20, 2008. Enable Capital Management, as general and investment manager of Enable Growth Partners L.P. and other clients, may be deemed to have the power to direct the voting or disposition of shares of common stock held by Enable Growth Partners L.P. (277,040 shares of common stock) and other clients (108,940 shares of common stock). Therefore, Energy Capital Management, LLC, as Enable Growth Partners L.P.’s and those other accounts’ general partner and investment manager, and Mitchell S. Levine, as managing member and majority owner of Enable Capital Management, LLC, may be deemed to beneficially own the shares of common stock owned by Enable Growth Partners L.P. and such other accounts.

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DESCRIPTION OF CAPITAL STOCK

Common Stock

Our articles of incorporation authorize the issuance of 100,000,000 shares of common stock, $0.001 par value per share, of which 4,443,467 shares were outstanding as of September 2, 2008. Holders of common stock have no cumulative voting rights. Holders of shares of common stock are entitled to share ratably in dividends, if any, as may be declared, from time to time by the board of directors in its discretion, from funds legally available to be distributed. In the event of a liquidation, dissolution or winding up of us, the holders of shares of common stock are entitled to share pro rata all assets remaining after payment in full of all liabilities. Holders of common stock have no preemptive rights to purchase our common stock. There are no conversion rights or redemption or sinking fund provisions with respect to the common stock. All of the outstanding shares of common stock are validly issued, fully paid and non-assessable.

Preferred Stock

Our articles of incorporation authorizes the issuance of 10,000,000 shares of preferred stock, $0.001 par value per share, of which no shares were outstanding as of the date of this prospectus. The preferred stock may be issued from time to time by the board of directors as shares of one or more classes or series. Our board of directors, subject to the provisions of our articles of incorporation and limitations imposed by law, is authorized to:

•  adopt resolutions;

•  issue the shares;

•  fix the number of shares;

•  change the number of shares constituting any series; and

•  provide for or change the following:

•  the voting powers;

•  designations;

•  preferences; and

•  relative, participating, optional or other special rights, qualifications, limitations or restrictions, including the following:

•  dividend rights, including whether dividends are cumulative;

•  dividend rates;

•  terms of redemption, including sinking fund provisions;

•  redemption prices;

•  conversion rights; and

•  liquidation preferences of the shares constituting any class or series of the preferred stock.

In each of the listed cases, we will not need any further action or vote by the stockholders.

One of the effects of undesignated preferred stock may be to enable the board of directors to render more difficult or to discourage an attempt to obtain control of us by means of a tender offer, proxy contest, merger or otherwise, and thereby to protect the continuity of our management. The issuance of shares of preferred stock pursuant to the board of director’s authority described above may adversely affect the rights of holders of common stock. For example, preferred stock issued by us may rank prior to the common stock as to dividend rights, liquidation preference or both, may have full or limited voting rights and may be convertible into shares of common stock. Accordingly, the issuance of shares of preferred stock may discourage bids for the common stock at a premium or may otherwise adversely affect the market price of the common stock.

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Debenture Financing

On April 11, 2007, we entered into financing agreements for $9.0 million of senior secured debentures. The debentures have a three-year term and bear an interest rate equal to 10% per annum. In accordance with the terms of the debentures, we received $6.3 million (before expenses and placement fees) at the first closing on April 13, 2007 and an additional $2.7 million on June 21, 2007. Net proceeds from the debentures were approximately $8.3 million, after approximately $700,000 in fees and expenses to our placement agent, C. K. Cooper & Company, attorney’s fees and post-closing fees and expenses. On July 7, 2008, we redeemed debentures with an aggregate principal amount of $6.3 million with proceeds from our new senior secured credit facility.

In connection with the sale of the debentures, we agreed to issue the debenture holders 1,800,000 shares of common stock (1,260,000 shares of common stock were issued on April 13, 2007 and 540,000 shares of common stock were issued on June 21, 2007).

Right to Redeem Debenture.  So long as a registration statement covering all of the registrable securities is effective, we have the option of prepaying the principal, in whole but not in part by paying the amount equal to 100% of the principal, together with accrued and unpaid interest by giving six (6) business days prior notice of redemption to the lenders. Pursuant to a Consent and Waiver Agreement dated April 9, 2008 all of the debenture holders consented to the redemption of their debentures with the proceeds of this offering without further notice.

Registration Rights.  Pursuant to the terms of the Registration Rights Agreement, as amended, we are obligated to register 1,000,000 shares of common stock and 600,000 interest shares issuable under the debentures. The registration statement to register the 1,000,000 shares of common stock must be declared effective by October 22, 2008 to avoid the monetary damages described below.

If we fail to obtain and maintain the effectiveness of this registration statement through a date which the lender may sell all of its shares of common stock without restriction under Rule 144 of the Securities Act or the date on which the debenture holders shall have sold all of its shares of common required to be covered by this registration statement, we will be obligated to pay cash to this debenture holders equal to 1.5% of the aggregate purchase price allocable to such lender’s registrable securities included in such registration statement for each 30 day period following such effectiveness failure or maintenance failure. These payments are capped at 10% of the lender’s original purchase price as defined in the registration rights agreement.

Preemptive Rights.  So long as any debenture is outstanding, the debenture holders have the right to participate in any subsequent issuance of equity or equity equivalent securities up to each holder’s pro rata portion, based on the holder’s ownership of shares of common stock compared to the then-outstanding shares of common stock. At least five days before the closing of a subsequent issuance, we must give each debenture holder written notice of the issuance and each debenture holder may request specified additional information and may elect to participate in the issuance.

The preemptive rights do not apply to specified issuances, including: (1) options issued pursuant to an employee benefit plan for up to 1,000,000 options on specified terms; (2) securities issued in a bona fide underwritten public offering; and (3) issuances for services performed, at a value not less than $3.00 per share.

Additional Restrictions and Operational Covenants.  In addition to standard covenants and conditions such as us maintaining our reporting status with the SEC pursuant to the Securities Exchange Act, the debentures contain certain restrictions regarding our operations, including limitations on our ability to incur liens or additional debt, pay dividends, redeem our stock, make specified investments and engage in merger, consolidation or asset sale transactions, among other restrictions.

Nevada Anti-Takeover Law and Charter and By-law Provisions

Depending on the number of residents in the state of Nevada who own our shares, we could be subject to the provisions of Sections 78.378 et seq. of the Nevada Revised Statutes which, unless otherwise provided in a company’s articles of incorporation or by-laws, restricts the ability of an acquiring person to obtain a

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controlling interest of 20% or more of our voting shares. Our articles of incorporation and by-laws do not contain any provision which would currently keep the change of control restrictions of Section 78.378 from applying to us.

We are subject to the provisions of Sections 78.411 et seq. of the Nevada Revised Statutes. In general, this statute prohibits a publicly held Nevada corporation from engaging in a “combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the combination or the transaction by which the person became an interested stockholder is approved by the corporation’s board of directors before the person becomes an interested stockholder. After the expiration of the three-year period, the corporation may engage in a combination with an interested stockholder under certain circumstances, including if the combination is approved by the board of directors and/or stockholders in a prescribed manner, or if specified requirements are met regarding consideration. The term “combination” includes mergers, asset sales and other transactions resulting in a financial benefit to the interested stockholder. Subject to certain exceptions, an “interested stockholder” is a person who, together with affiliates and associates, owns, or within three years did own, 10% or more of the corporation’s voting stock. A Nevada corporation may “opt out” from the application of Section 78.411 et seq. through a provision in its articles of incorporation or by-laws. We have not “opted out” from the application of this section.

Apart from Nevada law, however, our articles of incorporation and by-laws do not contain any provisions which are sometimes associated with inhibiting a change of control from occurring (i.e., we do not provide for a staggered board, or for “super-majority” votes on major corporate issues). However, we do have 10,000,000 shares of authorized “blank check” preferred stock, which could be used to inhibit a change in control.

Liability and Indemnification of Officers and Directors

Our articles of incorporation and by-laws provide that our directors and officers shall not be personally liable to us or our stockholders for damages for breach of fiduciary duty as a director or officer, except for liability for (a) acts of omissions which involve intentional or reckless conduct, fraud or a knowing violation of law, or (b) the payment of distributions in violation of Section 78.300 of the Nevada Revised Statutes.

Transfer Agent

The transfer agent for our common stock is Standard Registrar & Transfer Company Inc., 12528 South 1840 East, Draper, Utah 84020.

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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES FOR NON-U.S. HOLDERS

The following summary discusses material United States federal income tax consequences, and certain United States federal estate tax consequences, of the purchase, ownership and disposition of our common stock by a Non-U.S. Holder, as defined below. This summary deals only with common stock held as a capital asset within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended, or the Code, and is applicable only to Non-U.S. Holders who purchase common stock pursuant to this offering. This summary does not address specific tax consequences that may be relevant to you if you are a Non-U.S. Holder subject to special tax treatment (including pass-through entities, banks and insurance companies, dealers in securities, persons holding our common stock as part of a “straddle,” “hedge,” “conversion transaction” or other risk-reduction transaction, controlled foreign corporations, passive foreign investment companies, companies that accumulate earnings to avoid United States federal income tax, foreign tax-exempt organizations, former U.S. citizens or residents and persons who hold or receive common stock as compensation or pursuant to the exercise of compensatory options), and does not address alternative minimum tax consequences, if any, or any state, local, or foreign tax consequences.

This summary is based upon the provisions of the Code and United States Treasury regulations, rulings and judicial decisions as of the date hereof, all of which are subject to change, possibly with retroactive effect.

If you are considering the purchase of common stock, you should consult your own tax advisors regarding the United States federal income tax consequences to you of the purchase, ownership, and disposition of common stock, as well as any consequences arising under the laws of any other taxing jurisdiction.

For purposes of this summary, you are a Non-U.S. Holder if you are a beneficial owner of common stock who is not a U.S. person or a partnership (or other entity treated as a partnership) for United States federal income tax purposes. A U.S. person is (i) a citizen or resident alien individual of the United States; (ii) a corporation, or other entity treated as a corporation for United States federal income tax purposes, created or organized in or under the laws of the United States, any state thereof, or the District of Columbia; (iii) an estate, the income of which is subject to United States federal income taxation regardless of its source; or (iv) a trust (a) whose administration is subject to the primary supervision of a court within the United States and one or more U.S. persons have the authority to control all substantial decisions of the trust, or (b) if it has a valid election in effect under applicable United States Treasury regulations to be treated as a U.S. person.

U.S. Trade or Business Income

For purposes of this discussion, dividend income and gain on the sale or other taxable disposition of our common stock will be considered to be “U.S. trade or business income” if such income or gain is (i) effectively connected with the conduct by a Non-U.S. Holder of a trade or business within the United States, or (ii) in the case of a Non-U.S. Holder that is eligible for the benefits of an income tax treaty with the United States, attributable to a permanent establishment (or, for an individual, a fixed base) maintained by the Non-U.S. Holder in the United States. Generally, U.S. trade or business income is not subject to United States federal withholding tax (provided the Non-U.S. Holder complies with applicable certification and disclosure requirements). Instead, U.S. trade or business income is subject to United States federal income tax on a net income basis at regular United States federal income tax rates in the same manner as a U.S. person, unless an applicable income tax treaty provides otherwise. Any U.S. trade or business income received by a corporate Non-U.S. Holder may be subject to an additional “branch profits tax” at a 30% rate or such lower rate as may be specified by an applicable income tax treaty.

Distributions

Provided the dividend income is not considered to be U.S. trade or business income, distributions of cash or property that we pay will generally constitute dividends for United States federal income tax purposes to the extent paid from our current or accumulated earnings and profits (as determined under United States federal income tax principles). A Non-U.S. Holder generally will be subject to withholding of United States federal income tax at a 30% rate on any dividends received in respect of our stock, or at a lower rate provided

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by an applicable income tax treaty. If the amount of a distribution exceeds our current and accumulated earnings and profits, such excess first will be treated as a tax-free return of capital to the extent of the Non-U.S. Holder’s tax basis in our common stock (with a corresponding reduction in such Non-U.S. Holder’s tax basis in our common stock), and thereafter will be treated as gain realized on the sale or other disposition of the common stock and will be treated as described under “— Sale or Other Disposition of Our Common Stock” below. In order to obtain a reduced rate of United States federal withholding tax under an applicable income tax treaty, a Non-U.S. Holder, who is otherwise entitled to benefits under an income tax treaty, will be required to provide a properly executed IRS Form W-8BEN certifying under penalties of perjury its entitlement to benefits under the treaty. Special certification requirements and other requirements apply to certain Non-U.S. Holders that are entities rather than individuals.

If you are eligible for a reduced rate of United States withholding tax pursuant to an applicable income tax treaty, you may obtain a refund or credit of any excess amounts withheld by timely filing an appropriate claim for refund with the United States Internal Revenue Service, or IRS. A Non-U.S. Holder should consult its own tax advisor regarding its possible entitlement to benefits under an income tax treaty and the filing of a United States tax return for claiming a refund of United States federal withholding tax.

The United States federal withholding tax does not apply to dividends that are U.S. trade or business income, as defined above, of a Non-U.S. Holder who provides a properly executed IRS Form W-8ECI, certifying that the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States.

Sale or Other Disposition of Our Common Stock

Any gain that a Non-U.S. Holder realizes upon the sale or other disposition of a share of common stock generally will not be subject to United States federal income or withholding tax unless:

•  The gain is U.S. trade or business income, as defined and discussed above;

•  The Non-U.S. Holder is an individual who is present in the United States for 183 days or more in the taxable year of the disposition, and certain other conditions are met; or

•  Our common stock constitutes a “United States Real Property interest” by reason of our status as a United States real property holding corporation, or a USRPHC, under Section 897 of the Code at any time during the shorter of the five-year period ending on the date of disposition and the Non-U.S. Holder’s holding period for our common stock.

In general, a corporation is a USRPHC if the fair market value of its “United States real property interests” (as defined in the Code and applicable United States Treasury regulations) equals or exceeds 50% of the sum of the fair market value of its worldwide real property interests and its other assets used or held for use in a trade or business. If we are determined to be a USRPHC, the United States federal income and withholding taxes relating to interests in USRPHCs nevertheless will not apply to gains derived from the sale or other disposition of our common stock by a Non-U.S. Holder whose shareholdings, actual and constructive, at all times during the applicable period, amount to 5% or less of our common stock, provided that our common stock is regularly traded on an established securities market. We do not believe we currently are, and do not anticipate becoming, a USRPHC. However, no assurance can be given that we will not be a USRPHC, or that our common stock will be considered regularly traded, when a Non-U.S. Holder sells its shares of our common stock.

Gain described in the second bullet point above will be subject to United States federal income tax at a flat 30% rate (or such lower rate as may be specified by an applicable income tax treaty), but may be offset by United States source capital losses (even though the individual is not considered a resident of the United States).

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U.S. Federal Estate Tax

If you are an individual Non-U.S. Holder, common stock that you hold at the time of death will be included in your gross estate for United States federal estate tax purposes, and may be subject to United States federal estate tax, unless an applicable estate tax treaty provides otherwise.

Information Reporting and Backup Withholding

We must report annually to the IRS and to you the amount of dividends paid to you on your shares of common stock and the tax withheld with respect to such dividends, regardless of whether withholding was required. Copies of the information returns reporting such dividends and withholding may also be made available to the tax authorities in the country in which you reside under the provisions of an applicable income tax treaty or exchange of information treaty.

The United States imposes a backup withholding tax on dividends and certain other types of payments to U.S. persons. The backup withholding rate is currently 28%. You will not be subject to backup withholding on dividends you receive on your shares of common stock if you provide proper certification (usually on an IRS Form W-8BEN) of your status of a Non-U.S. Holder or otherwise establishes an exemption, provided that the payor does not have actual knowledge or reason to know that you are a U.S. person or that the conditions of any other exemption are not, in fact, satisfied.

Information reporting and, depending on the circumstances, backup withholding, generally will apply to the proceeds of a sale of common stock within the United States or conducted through the United States office of any broker, United States or foreign, unless you certify under penalties of perjury that you are a Non-U.S. Holder or otherwise establish an exemption, provided that the broker does not have actual knowledge or reason to know that you are a U.S. person or that the conditions of any other exemption are not, in fact, satisfied. The payment of the proceeds from the disposition of our common stock to or through a non-U.S. office of a non-U.S. broker generally will not be subject to information reporting or backup withholding unless the non-U.S. broker has certain types of relationships with the United States, or a U.S. related person. In the case of the payment of the proceeds from the disposition of our common stock to or through a non-U.S. office of a broker that is either a U.S. person or a U.S. related person, the United States Treasury regulations generally require information reporting (but not backup withholding) on the payment unless the broker has documentary evidence that the holder is a Non-U.S. Holder and the broker has no knowledge to the contrary. Non-U.S. Holders should consult their own tax advisors on the application of information reporting and backup withholding to them in their particular circumstances (including upon their disposition of our common stock).

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules from a payment to a Non-U.S. Holder may be allowed as a refund or a credit against your United States federal income tax liability, if any, provided that you furnish the required information to the IRS in a timely manner.

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UNDERWRITING

Subject to the terms and conditions described in an underwriting agreement among us, C. K. Cooper & Company, as representative and book-running manager, we have agreed to sell to the underwriters, and the underwriters have severally agreed to purchase from us, the following number of shares of common stock at the offering price less the underwriting discount set forth on the cover page of this prospectus.

Underwriter	Number of Shares
C. K. Cooper & Company, Inc.
Rodman & Renshaw, LLC
Joseph Gunnar & Co., LLC
Total		5,000,000

The underwriters have agreed to purchase all of the shares sold under the underwriting agreement if any of the shares are purchased, other than shares covered by the over-allotment option described below. The underwriting agreement provides that the underwriters’ obligation to purchase shares of common stock depends on the satisfaction of the conditions contained in the underwriting agreement including:

•  the obligation to purchase all of the shares of common stock offered hereby (other than those shares of common stock covered by their option to purchase additional shares as described below), if any of the shares are purchased;

•  the representations and warranties made by us to the underwriters are true;

•  there is no material change in our business or the financial markets; and

•  we deliver customary closing documents to the underwriters.

We have granted the underwriters an option exercisable for 30 days from the date of the underwriting agreement to purchase a total of up to 750,000 additional shares at the public offering price less the underwriting discount. The underwriters may exercise this option solely to cover any over-allotments, if any, made in connection with this offering. To the extent the underwriters exercise this option in whole or in part, each will be obligated, subject to conditions contained in the underwriting agreement, to purchase a number of additional shares approximately proportionate to that underwriter’s initial commitment amount reflected in the above table.

The underwriters have advised us that they propose initially to offer the shares to the public at the public offering price on the cover page of this prospectus and to dealers at that price less a concession not in excess of $      per share. After the offering, the offering price and other selling terms may be changed.

The following table shows the per share and total underwriting discounts and commissions to be paid to the underwriters by EnerJex. The information assumes either no exercise or full exercise by the underwriters of their over-allotment option.

	Without Option	With Option
Per Share	$	$
Total	$	$

The expenses of this offering that are payable by us, excluding the underwriting discount and commissions and related fees, are estimated at approximately $750,000. We have agreed to reimburse C. K. Cooper & Company for its out of pocket expenses in connection with this offering, including its attorneys’ fees.

In connection with this offering, we have agreed to issue to the underwriters warrants entitling the underwriters, or their assigns, to purchase up to an aggregate of 5% of the total number of shares sold in this offering at a price equal to 135% of the public offering price per share. The underwriter warrants will be exercisable for three years from the closing date of the offering and will contain customary exercise provisions, representations and anti-dilution provisions.

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The underwriter warrants are deemed compensation by the Financial Industry Regulatory Authority, Inc., and may not be sold, transferred, pledged, hypothecated or assigned or be the subject at any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition of the securities by any person for a period of 180-days following the effective date of the offering pursuant to Rule 2710(g)(1) of the NASD Conduct Rules.

We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act, or to contribute to payments the underwriters may be required to make in respect of those liabilities.

Our executive officers, directors, holders of our debentures and certain holders of our common stock have agreed that, without the prior written consent of each of C. K. Cooper & Company, they will not directly or indirectly, (1) offer for sale, sell, pledge, or otherwise dispose of (or enter into any transaction or device that is designed to, or could be expected to, result in the disposition by any person at any time in the future of) any shares of common stock (including, without limitation, shares of common stock that may be deemed to be beneficially owned by us or them in accordance with the rules and regulations of the SEC and shares of common stock that may be issued upon exercise of any options or warrants) or securities convertible into or exercisable or exchangeable for common stock, (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic consequences of ownership of the common stock, (3) make any demand for or exercise any right or file or cause to be filed a registration statement, including any amendments thereto, with respect to the registration of any shares of common stock or securities convertible, exercisable or exchangeable into common stock or any of our other securities except for any registration statement EnerJex is required to file under preexisting agreements, or (4) publicly disclose the intention to do any of the foregoing for, in the case of the holders of our debentures, a period of 60 days from the date of the prospectus and, in the case of our executive officers, directors and other stockholders, a period of 180 days after the date of this prospectus.

The 60-day or 180-day restricted periods described in the preceding paragraph will be extended if:

•  during the last 17 days of the 60-day or 180-day restricted periods we issue an earnings release or material news or a material event relating to us occurs; or

•  prior to the expiration of the 60-day or 180-day restricted periods, we announce that we will release earnings results during the 16-day period beginning on the last day of the 60-day or 180-day periods,

in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or occurrence of a material event, unless such extension is waived in writing by C. K. Cooper & Company.

C. K. Cooper & Company, in its sole discretion, may release the common stock and other securities subject to the lock-up agreements described above in whole or in part at any time with or without notice. When determining whether or not to release common stock and other securities from lock-up agreements, C. K. Cooper & Company will consider, among other factors, the holder’s reasons for requesting the release, the number of shares of common stock and other securities for which the release is being requested and market conditions at the time. C. K. Cooper & Company has no present intent to release the common stock and other securities subject to the lock-up agreements.

We have applied to list our common stock on the American Stock Exchange under the symbol “JEX.”

A prospectus in electronic format may be made available on the Internet sites or through other online services maintained by one or more of the underwriters of this offering, or by their affiliates. Other than any prospectus made available in electronic format in this manner, the information on any web site containing the prospectus is not part of this prospectus or the registration statement of which this prospectus forms a part, has not been approved or endorsed by us or any underwriter in such capacity and should not be relied on by prospective investors.

In connection with this offering, some participants in the offering may purchase and sell shares of common stock in the open market. These transactions may include short sales, syndicate covering transactions

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and stabilizing transactions. Short sales involve sales by the underwriters of common stock in excess of the number of shares required to be purchased by the underwriters in the offering, which creates a syndicate short position. “Covered” short sales are sales of shares made in an amount up to the number of shares represented by the underwriters’ over-allotment option. Transactions to close out the covered syndicate short involve either purchases of the common stock in the open market after the distribution has been completed or the exercise of the over-allotment option. In determining the source of shares to close out the covered syndicate short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option. The underwriters may also make “naked” short sales, or sales in excess of the over-allotment option. The underwriters must close out any naked short position by purchasing shares of common stock in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of bids for or purchases of shares in the open market while the offering is in progress.

The underwriters also may impose a penalty bid. Penalty bids permit the underwriters to reclaim a selling concession from an underwriter or syndicate member when the underwriters repurchase shares originally sold by that underwriter or syndicate member in order to cover syndicate short positions or make stabilizing purchases. Any of these activities may have the effect of raising or maintaining the market price of the common stock or preventing or retarding a decline in the market price of the common stock. As a result, the price of the common stock may be higher than the price that might otherwise exist in the open market. The underwriters may conduct these transactions on the American Stock Exchange or otherwise. If the underwriters commence any of these transactions, they may discontinue them at any time.

C. K. Cooper & Company acted as placement agent in our private placement of debentures in April 2007. The underwriters may in the future perform investment banking and advisory services for us from time to time for which they may in the future receive customary fees and expenses.

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LEGAL MATTERS

The validity of the issuance of the shares of common stock offered hereby will be passed upon for us by Husch Blackwell Sanders LLP, Kansas City, Missouri. Certain legal matters will be passed upon for the underwriter by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California.

EXPERTS

Weaver & Martin, LLC, independent registered public accounting firm, has audited our financial statements at March 31, 2007 and March 31, 2008, and for the periods from inception (December 30, 2005) to March 31, 2006, the fiscal year ended March 31, 2007 and the fiscal year ended March 31, 2008, as set forth in their reports. We have included our financial statements in the prospectus and elsewhere in the registration statement in reliance on Weaver & Martin, LLC’s report, given on their authority as experts in accounting and auditing.

INDEPENDENT PETROLEUM ENGINEERS

Certain information incorporated herein regarding estimated quantities of oil and natural gas reserves and their present value is based on estimates of the reserves and present values prepared by or derived from estimates prepared by McCune Engineering P.E., independent reserve engineer. The reserve information is incorporated herein in reliance upon the authority of said firm as an expert with respect to such report.

WHERE YOU CAN FIND MORE INFORMATION

We have filed a registration statement on Form S-1 under the Securities Act with the SEC with respect to the common stock offered by this prospectus. This prospectus does not include all of the information contained in the registration statement or the exhibits and schedules filed therewith. You should refer to the registration statement and its exhibits for additional information. Whenever we make reference in this prospectus to any of our contracts, agreements or other documents, the references are not necessarily complete and you should refer to the exhibits attached to the registration statement for copies of the actual contract, agreement or other document.

We file annual, quarterly and special reports and other information with the SEC. You can read these SEC filings and reports, including the registration statement, over the Internet at the SEC’s website at www.sec.gov or on our website at www.enerjexresources.com. You can also obtain copies of the documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street, NE, Washington, DC 20549 on official business days between the hours of 10:00 am and 3:00 pm. Please call the SEC at (800) SEC-0330 for further information on the operations of the public reference facilities. We will provide a copy of our annual report to security holders, including audited financial statements, at no charge upon receipt of your written request to us at EnerJex Resources, Inc., 7300 W. 110^th, 7^th Floor, Overland Park, Kansas 66210.

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GLOSSARY

Term	Definition
Barrel (bbl)	The standard unit of measurement of liquids in the petroleum industry, it contains 42 U.S. standard gallons. Abbreviated to “bbl”.
Basin	A depression in the crust of the Earth, caused by plate tectonic activity and subsidence, in which sediments accumulate. Sedimentary basins vary from bowl-shaped to elongated troughs. Basins can be bounded by faults. Rift basins are commonly symmetrical; basins along continental margins tend to be asymmetrical. If rich hydrocarbon source rocks occur in combination with appropriate depth and duration of burial, then a petroleum system can develop within the basin.
BOE	One barrel of oil equivalent, determined using a ratio of six Mcf of natural gas to one barrel of crude oil.
BOEPD	BOE per day.
BOPD	Abbreviation for barrels of oil per day, a common unit of measurement for volume of crude oil. The volume of a barrel is equivalent to 42 U.S. standard gallons.
Carried Working Interest	The owner of this type of working interest in the drilling of a well incurs no capital contribution requirement for drilling or completion costs associated with a well and, if specified in the particular contract, may not incur capital contribution requirements beyond the completion of the well.
Completion / Completing	A well made ready to produce oil or natural gas.
Costless Collar	When viewed against an appropriate index, the parties agree to a maximum price (call option) and a minimum price (put option), through a financially-settled collar. If the average monthly prices are within the collar range there will be no monthly settlement. However, if average monthly prices fluctuate outside the collar, the parties settle the difference in cash.
Development	The phase in which a proven oil or natural gas field is brought into production by drilling development wells.
Development Drilling	Wells drilled during the Development phase.
Division order	A directive signed by the royalty owners verifying to the purchaser or operator of a well the decimal interest of production owned by the royalty owner. The Division Order generally includes the decimal interest, a legal description of the property, the operator’s name, and several legal agreements associated with the process. Completion of this step generally precedes placing the royalty owner on pay status to begin receiving revenue payments.
Drilling	Act of boring a hole through which oil and/or natural gas may be produced.
Dry Wells	A well found to be incapable of producing hydrocarbons in sufficient quantities such that proceeds from the sale of such production exceed production expenses and taxes.
Exploration	The phase of operations which covers the search for oil or natural gas generally in unproven or semi-proven territory.
Exploratory Drilling	Drilling of a relatively high percentage of properties which are unproven.

80

Term	Definition
Farm out	An arrangement whereby the owner of a lease assigns all or some portion of the lease or licenses to another company for undertaking exploration or development activity.
Field	An area consisting of a single reservoir or multiple reservoirs all grouped on, or related to, the same individual geological structural feature or stratigraphic condition. The field name refers to the surface area, although it may refer to both the surface and the underground productive formations.
Fixed price swap	A derivative instrument that exchanges or “swaps” the “floating” or daily price of a specified volume of natural gas, oil or NGL, over a specified period, for a fixed price for the specified volume over the same period (typically three months or longer).
Gathering line / system	Pipelines and other facilities that transport oil or natural gas from wells and bring it by separate and individual lines to a central delivery point for delivery into a transmission line or mainline.
Gross acre	The number of acres in which the Company owns any working interest.
Gross Producing Well	A well in which a working interest is owned and is producing oil or natural gas or other liquids or hydrocarbons. The number of gross producing wells is the total number of wells producing oil or natural gas or other liquids or hydrocarbons in which a working interest is owned.
Gross well	A well in which a working interest is owned. The number of gross wells is the total number of wells in which a working interest is owned.
Held-By-Production (HBP)	Refers to an oil and natural gas property under lease, in which the lease continues to be in force, because of production from the property.
Horizontal drilling	A drilling technique used in certain formations where a well is drilled vertically to a certain depth and then turned and drilled horizontally. Horizontal drilling allows the wellbore to follow the desired formation.
In-fill wells	In-fill wells refers to wells drilled between established producing wells; a drilling program to reduce the spacing between wells in order to increase production and recovery of in-place hydrocarbons.
Oil and Natural Gas Lease	A legal instrument executed by a mineral owner granting the right to another to explore, drill, and produce subsurface oil and natural gas. An oil and natural gas lease embodies the legal rights, privileges and duties pertaining to the lessor and lessee.
Lifting Costs	The expenses of producing oil from a well. Lifting costs are the operating costs of the wells including the gathering and separating equipment. Lifting costs do not include the costs of drilling and completing the wells or transporting the oil.
Mcf	Thousand cubic feet.
Mmcf	Million cubic feet.
Net acres	Determined by multiplying gross acres by the working interest that the Company owns in such acres.
Net Producing Wells	The number of producing wells multiplied by the working interest in such wells.
Net Revenue Interest	A share of production revenues after all royalties, overriding royalties and other nonoperating interests have been taken out of production for a well(s).

81

Term	Definition
Operator	A person, acting for itself, or as an agent for others, designated to conduct the operations on its or the joint interest owners’ behalf.
Overriding Royalty	Ownership in a percentage of production or production revenues, free of the cost of production, created by the lessee, company and/or working interest owner and paid by the lessee, company and/or working interest owner out of revenue from the well.
Pooled Unit	A term frequently used interchangeably with “Unitization” but more properly used to denominate the bringing together of small tracts sufficient for the granting of a well permit under applicable spacing rules.
Proved Developed Reserves	Proved reserves that can be expected to be recovered from existing wells with existing equipment and operating methods. This definition of proved developed reserves has been abbreviated from the applicable definitions contained in Rule 4-10(a)(2-4) of Regulation S-X.
Proved Developed Non-Producing	Proved developed reserves expected to be recovered from zones behind casings in existing wells.
Proved Undeveloped Reserves	Proved undeveloped reserves are the portion of proved reserves which can be expected to be recovered from new wells on undrilled proved acreage, or from existing wells where a relatively major expenditure is required for completion. This definition of proved undeveloped reserves has been abbreviated from the applicable definitions contained in Rule 4-10(a)(2-4) of Regulation S-X.
PV10	PV10 means the estimated future gross revenue to be generated from the production of proved reserves, net of estimated production and future development and abandonment costs, using prices and costs in effect at the determination date, before income taxes, and without giving effect to non-property related expenses, discounted to a present value using an annual discount rate of 10% in accordance with the guidelines of the SEC. PV10 is a non-GAAP financial measure. See “Business and Properties — Reserves” on page 53 for a reconciliation to the comparable GAAP financial measure.
Re-completion	Completion of an existing well for production from one formation or reservoir to another formation or reservoir that exists behind casing of the same well.
Reservoir	The underground rock formation where oil and natural gas has accumulated. It consists of a porous rock to hold the oil or natural gas, and a cap rock that prevents its escape.
Reservoir Pressure	The pressure at the face of the producing formation when the well is shut-in. It equals the shut-in pressure at the wellhead plus the weight of the column of oil and natural gas in the well.
Roll-Up Strategy	A “roll-up strategy” is a common business term used to describe a business plan whereby a company accumulates multiple small operators in a particular business sector with a goal to generate synergies, stimulate growth and optimize the value of the individual pieces.
Secondary Recovery	The stage of hydrocarbon production during which an external fluid such as water or natural gas is injected into the reservoir through injection wells located in rock that has fluid communication with production wells. The purpose of secondary recovery is to maintain reservoir pressure and to displace hydrocarbons toward the wellbore.

82

Term	Definition
	The most common secondary recovery techniques are natural gas injection and waterflooding. Normally, natural gas is injected into the natural gas cap and water is injected into the production zone to sweep oil from the reservoir. A pressure-maintenance program can begin during the primary recovery stage, but it is a form of enhanced recovery.
Shut-in well	A well which is capable of producing but is not presently producing. Reasons for a well being shut-in may be lack of equipment, market or other.
Stock Tank Barrel or STB	A stock tank barrel of oil is the equivalent of 42 U.S. gallons at 60 degrees fahrenheit.
Undeveloped acreage	Lease acreage on which wells have not been drilled or completed to a point that would permit the production of commercial quantities of oil and natural gas regardless of whether such acreage contains proved reserves.
Unitize, Unitization	When owners of oil and/or natural gas reservoir pool their individual interests in return for an interest in the overall unit.
Waterflood	The injection of water into an oil reservoir to “push” additional oil out of the reservoir rock and into the wellbores of producing wells. Typically a secondary recovery process.
Water Injection Wells	A well in which fluids are injected rather than produced, the primary objective typically being to maintain or increase reservoir pressure, often pursuant to a waterflood.
Water Supply Wells	A well in which fluids are being produced for use in a Water Injection Well.
Wellbore	A borehole; the hole drilled by the bit. A wellbore may have casing in it or it may be open (uncased); or part of it may be cased, and part of it may be open. Also called a borehole or hole.
Working Interest	An interest in an oil and natural gas lease entitling the owner to receive a specified percentage of the proceeds of the sale of oil and natural gas production or a percentage of the production, but requiring the owner of the working interest to bear the cost to explore for, develop and produce such oil and natural gas.

83

INDEX TO FINANCIAL STATEMENTS

Reverse Stock Split

Effective on July 25, 2008, we implemented a one-for-five reverse split of our issued and outstanding common stock. All share and per share data in these consolidated financial statements and related notes hereto have been retroactively adjusted to account for the effect of the reverse stock split for all periods presented. The reverse split did not affect the authorized shares and par value per share.

	Page
Index to Financial Statements		F-1
Report of Independent Registered Public Accounting Firm		F-2
Consolidated Balance Sheets at March 31, 2008 and 2007		F-3
Consolidated Statements of Operations for the Fiscal Years Ended March 31, 2008 and 2007		F-4
Consolidated Statement of Stockholders’ Equity (Deficit) for the Fiscal Years Ended March 31, 2008 and 2007		F-5
Consolidated Statement of Cash Flows for the Fiscal Years Ended March 31, 2008 and 2007		F-6
Notes to Consolidated Financial Statements		F-7
Consolidated Balance Sheets at June 30, 2008 (unaudited) and March 31, 2008		G-1
Consolidated Statements of Operations for the Three Months Ended June 30, 2008 and 2007 (unaudited)		G-2
Consolidated Statements of Cash Flows for the Three Months Ended June 30, 2008 and 2007 (unaudited)		G-3
Notes to Consolidated Financial Statements		G-4

F-1

Report of Independent Registered Public Accounting Firm

Stockholders and Directors
EnerJex Resources, Inc.
Overland Park, Kansas

We have audited the accompanying consolidated balance sheet of EnerJex Resources, Inc. and its subsidiaries as of March 31, 2008 and 2007 and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years in the two-year period ended March 31, 2008. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of EnerJex Resources, Inc. and subsidiaries as of March 31, 2008 and 2007 and the consolidated results of its operations, stockholders’ equity and cash flows for each of the years in the two — year period ended March 31, 2008 in conformity with accounting principles generally accepted in the United States of America.

/s/  Weaver & Martin, LLC

Weaver & Martin, LLC

Kansas City, Missouri
June 23, 2008

F-2

EnerJex Resources, Inc. and Subsidiaries

Consolidated Balance Sheets

	March 31,
	2008			2007
ASSETS
Current assets:
Cash	$	951,004		$	99,493
Accounts receivable		227,055			4,138
Notes and interest receivable		—			10,300
Prepaid debt issue costs		157,191			—
Deposits and prepaid expenses		176,345			6,673
Total current assets		1,511,595			120,604
Fixed assets		185,299			35,500
Less: Accumulated depreciation		30,982			8,875
Total fixed assets		154,317			26,625
Other assets:
Notes receivable-officer		—			23,100
Prepaid debt issue costs		157,191			—
Oil and gas properties using full-cost accounting:
Properties not subject to amortization		62,216			322,178
Properties subject to amortization		8,982,510			—
Total other assets		9,201,917			345,278
Total assets	$	10,867,829		$	492,507
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	416,834		$	42,299
Accrued liabilities		70,461			95,890
Notes payable		965,000			350,000
Deferred payments from Euramerica development		251,951			—
Long-term debt, current		412,930			—
Total current liabilities		2,117,176			488,189
Asset retirement obligation		459,689			23,908
Convertible note payable		25,000			25,000
Long-term debt, net of discount of $3,410,202		6,831,972			—
Total liabilities		9,433,837			537,097
Contingencies and commitments
Stockholders’ equity (deficit):
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $0.001 par value, 100,000,000 shares authorized; shares issued and outstanding — 4,440,652 at March 31, 2008 and 2,635,732 at March 31, 2007		4,441			2,636
Common stock owed but not issued-3,000 shares		—			3
Paid in capital		8,853,457			2,548,742
Retained (deficit)		(7,423,906	)		(2,595,971	)
Total stockholders’ equity (deficit)		1,433,992			(44,590	)
Total liabilities and stockholders’ equity (deficit)	$	10,867,829		$	492,507

See notes to consolidated financial statements.

F-3

EnerJex Resources, Inc. and Subsidiaries

Consolidated Statements of Operations

	For the Fiscal Years Ended
	March 31,
	2008			2007
Oil and natural gas revenues	$	3,602,798		$	90,800
Expenses:
Direct operating costs		1,795,188			172,417
Repairs on oil & gas equipment		—			165,603
Depreciation, depletion and amortization		935,330			23,978
Professional fees		1,226,998			302,071
Salaries		1,703,099			288,016
Administrative expense		887,872			182,773
Impairment of oil & gas properties		—			273,959
Impairment of goodwill		—			677,000
Total expenses		6,548,487			2,085,817
Loss from operations		(2,945,689	)		(1,995,017	)
Other income (expense):
Interest expense		(1,882,246	)		(8,434	)
Other		—			348
Total other income (expense)		(1,882,246	)		(8,086	)
Net (loss)	$	(4,827,935	)	$	(2,003,103	)
Net (loss) per share of common stock-basic and fully diluted	$	(1.13	)	$	(0.82	)
Weighted average shares outstanding		4,284,143			2,448,318

See notes to consolidated financial statements.

F-4

EnerJex Resources, Inc. and Subsidiaries

Consolidated Statements of Stockholders’ Equity (Deficit)

														Total
	Common Stock													Stockholders’
			Par		Owed But			Paid In			Retained			Equity
	Shares		Value		Not Issued			Capital			Deficit			(Deficit)
Balance, April 1, 2006		2,210,000		2,210	$	—			1,441,558		$	(592,868	)	$	850,900
Stock sold		153,600		154		—			414,646			—			414,800
Stock issued for services		148,000		148		3			454,849			—			455,000
Stock issued in reverse merger		60,132		60		—			(60	)		—			—
Stock issued for contract extension with joint venture partner		64,000		64		—			199,936			—			200,000
Stock options issued for services		—		—		—			37,813			—			37,813
Net (loss) for the year		—		—		—			—			(2,003,103	)		(2,003,103	)
Balance, March 31, 2007		2,635,732		2,636		3			2,548,742			(2,595,971	)		(44,590	)
Stock sold		1,800,000		1,800		—			4,311,956			—			4,313,756
Stock issued for services		1,920		2		—			14,998			—			15,000
Previously authorized but unissued stock		3,000		3		(3	)		—			—			—
Options issued for services		—		—		—			1,977,761			—			1,977,761
Net (loss) for the year		—		—		—			—			(4,827,935	)		(4,827,935	)
Balance, March 31, 2008		4,440,652		4,441	$	—			8,853,457		$	(7,423,906	)	$	1,433,992

See notes to consolidated financial statements.

F-5

EnerJex Resources, Inc.

Consolidated Statements of Cash Flows

	For the Fiscal Years Ended
	March 31,
	2008			2007
Cash flows from operating activities
Net (loss)	$	(4,827,935	)	$	(2,003,103	)
Depreciation and depletion		935,330			22,108
Debt issue cost amortization		152,453			—
Stock and options issued for services		1,992,761			186,813
Accretion of interest on long-term debt discount		1,089,798			—
Accretion of asset retirement obligation		30,331			1,870
Impairment of oil & gas properties		—			273,959
Impairment of goodwill					677,000
Loss on sale of vehicle		—			3,854
Adjustments to reconcile net (loss) to cash used in operating activities:
Accounts receivable		(222,917	)		(1,589	)
Notes and interest receivable		10,300			(10,300	)
Deposits and prepaid expenses		(169,672	)		2,188
Accounts payable		374,535			(683,746	)
Accrued liabilities		(25,429	)		95,387
Deferred payment from Euramerica for development		251,951			—
Cash used in operating activities		(408,494	)		(1,435,559	)
Cash flows from investing activities
Purchase of fixed assets		(149,799	)		(35,500	)
Additions to oil & gas properties		(9,530,321	)		(104,080	)
Sale of oil & gas properties		300,000			—
Note and interest receivable from officer		23,100			(23,100	)
Proceeds from sale of vehicle		—			11,500
Cash used in investing activities		(9,357,020	)		(151,180	)
Cash flows from financing activities
Proceeds from note payable, net		615,000			350,000
Proceeds from sales of common stock		4,313,756			414,800
Debt issue costs		(466,835	)		—
Borrowings on long-term debt		6,344,816			—
Payments on long-term debt		(189,712	)		—
Stock issued for payables		—			306,000
Proceeds from convertible note		—			25,000
Cash provided from financing activities		10,617,025			1,095,800
Increase (decrease) in cash and cash equivalents		851,511			(490,939	)
Cash and cash equivalents, beginning		99,493			590,432
Cash and cash equivalents, end	$	951,004		$	99,493
Supplemental disclosures:
Interest paid	$	733,972		$	5,407
Income taxes paid	$	—		$	—
Non-cash transactions:
Share-based payments issued for services	$	280,591		$	558,000
Share-based payments issued for oil & gas properties	$	—		$	200,000

See notes to consolidated financial statements.

F-6

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements

Reverse Stock Split

Effective on July 25, 2008, we implemented a one-for-five reverse split of our issued and outstanding common stock. All share and per share data in these consolidated financial statements and related notes hereto have been retroactively adjusted to account for the effect of the reverse stock split for all periods presented. The reverse split did not affect the authorized shares and par value per share.

Note 1 — Summary of Accounting Policies

Nature of Business

We are an independent energy company engaged in the business of producing and selling crude oil and natural gas. This crude oil and natural gas is obtained primarily by the acquisition and subsequent exploration and development of mineral leases. Development and exploration may include drilling new exploratory or development wells on these leases. These operations are conducted primarily in Eastern Kansas.

Principles of Consolidation

Our consolidated financial statements include the accounts of our wholly-owned subsidiaries, EnerJex Kansas, Inc., DD Energy, Inc and EnerJex Development, LLC (currently inactive).

Use of Estimates

The preparation of these financial statements requires the use of estimates by management in determining our assets, liabilities, revenues, expenses and related disclosures. Actual amounts could differ from those estimates.

Trade Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount and do not bear any interest. We regularly review receivables to insure that the amounts will be collected and establish or adjust an allowance for uncollectible amounts as necessary using the specific identification method. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. There were no reserves for uncollectible amounts in the periods presented.

Share-Based Payments

Common stock, warrants and options issued for services are accounted for based on the fair market value at the date the services are performed. If the awards are based on a vesting period, the fair market value of the awards is determined as vesting is earned. If the services are to be performed over a period of time, the value is amortized over the life of the period that services are performed.

Income Taxes

We account for income taxes under the Statement of Financial Accounting Standards “SFAS” Statement 109, “Accounting for Income Taxes”. The asset and liability approach requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. The provision for income taxes differs from the amount currently payable because of temporary differences in the recognition of certain income and expense items for financial reporting and tax reporting purposes.

We adopted the Financial Accounting Standards Board “FASB” Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement No. 109” (“FIN 48”) as of April 1, 2007. FIN 48 clarifies the accounting for uncertainty in income taxes recognized in companies’ financial statements

F-7

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

in accordance with FASB Statement No. 109, “Accounting for Income Taxes”. As a result, we apply a more-likely-than-not recognition threshold for all tax uncertainties. FIN 48 only allows the recognition of those tax benefits that have a greater than fifty percent likelihood of being sustained upon examination by the taxing authorities. As a result of implementing FIN 48, we have reviewed our tax positions and determined there were no outstanding or retroactive tax positions with less than a 50% likelihood of being sustained upon examination by the taxing authorities, therefore the implementation of this standard has not had a material effect on the Company.

We classify tax-related penalties and net interest on income taxes as income tax expense. As of March 31, 2008 and 2007, no income tax expense had been incurred.

Fair Value of Financial Instruments

Our financial instruments consist of accounts receivable and notes payable. Interest rates currently available to us for debt with similar terms and remaining maturities are used to estimate fair value of such financial instruments. Accordingly the carrying amounts are a reasonable estimate of fair value.

Earnings Per Share

SFAS No. 128, “Earnings Per Share”, requires dual presentation of basic and diluted earnings per share on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the diluted income or loss per share computation.

For the year ended March 31, 2008 and 2007, there were 533,500 and 60,000, respectively, of potentially issuable shares of common stock pursuant to outstanding stock options and warrants. These have been excluded from the denominator of the diluted earnings per share computation, as their effect would be anti-dilutive.

Cash and Cash Equivalents

We consider all highly liquid investment instruments purchased with original maturities of three months or less to be cash equivalents for purposes of the consolidated statements of cash flows and other statements. We maintain cash on deposit, which, at times, exceed federally insured limits. We have not experienced any losses on such accounts and believe we are not exposed to any significant credit risk on cash and equivalents.

Revenue Recognition and Imbalances

Oil and gas revenues are recognized net of royalties when production is sold to a purchaser at a fixed or determinable price, when delivery has occurred and title has transferred, and if collection of the revenue is probable. Cash received relating to future revenues is deferred and recognized when all revenue recognition criteria are met.

We use the sales method of accounting for gas production imbalances. The volumes of gas sold may differ from the volumes to which we are entitled based on our interests in the properties. These differences create imbalances that are recognized as a liability only when the properties’ estimated remaining reserves net to us will not be sufficient to enable the under-produced owner to recoup its entitled share through production. No receivables are recorded for those wells where we have taken less than our share of production. Gas imbalances are reflected as adjustments to estimates of proved gas reserves and future cash flows in the supplemental oil and gas disclosures. There was no imbalance at March 31, 2008 and 2007.

F-8

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

Goodwill

Goodwill represents the excess of the purchase price of an entity over the estimated fair value of the assets acquired and liabilities assumed. We assess the carrying amount of goodwill by testing the goodwill for impairment annually and when impairment indicators arise. The impairment test requires allocating goodwill and all other assets and liabilities to assigned reporting units. The fair value of each unit is determined and compared to the book value of the reporting unit. If the fair value of the reporting unit is less than the book value, including goodwill, then the goodwill is written down to the implied fair value of the goodwill through a charge to expense.

Property and Equipment

Property and equipment are recorded at cost. Depreciation is on a straight-line method using the estimated lives of the assets (3-15 years). Expenditures for maintenance and repairs are charged to expense.

Debt Issue Costs

Debt issuance costs incurred are capitalized and subsequently amortized over the term of the related debt on the straight-line method of amortization over the estimated life of the debt.

Oil and Gas Properties

We follow the full-cost method of accounting for oil and natural gas properties. Accordingly, all costs associated with acquisition, exploration, and developments are capitalized.

All costs included in properties subject to amortization, are amortized on the unit-of-production method using estimates of proved reserves. Investments in unproved properties and major development projects are not amortized until proved reserves associated with the projects can be determined or until impairment occurs. If the results of an assessment indicate that the properties are impaired, the amount of the impairment is added to the capitalized costs to be amortized. Abandonment of oil and natural gas properties are charged to the full-cost pool and amortized.

Under the full-cost method, the net book value of oil and natural gas properties are subject to a “ceiling” amount. The ceiling is the estimated after-tax future net cash flows from proved oil and natural gas properties, discounted at 10% per annum plus the lower of cost or fair market value of unevaluated properties. In calculating future net revenues, prices and costs in effect at the time of the calculation are held constant for the lives of the oil and natural gas reserves, except for changes that are fixed and determinable by existing contracts. The excess, if any, of the net book value above this ceiling is charged to expense.

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

Long-Lived Assets

Impairment of long-lived assets is recorded when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying value. The carrying value of the assets is then reduced to their estimated fair value that is usually measured based on an estimate of future discounted cash flows.

Asset Retirement Obligations

We accrue for the future plugging and abandonment of oil and natural gas assets in the period in which the obligation is incurred. We accrue costs at estimated fair value. When the related liability is initially

F-9

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

recorded, we capitalize the cost by increasing the carrying amount of properties subject to amortization. Over time, the liability is accreted to its settlement value and the capitalized cost is depleted over the life of the related asset. Upon settlement of the liability, we recognize a gain or loss for any difference between the settlement amount and the liability recorded.

Major Purchasers

For the years ended March 31, 2008 and 2007 we sold all of our natural gas production to one purchaser and all of our oil production to one purchaser.

Recent Issued Accounting Standards

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measures” (“SFAS No. 157”). SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (“GAAP”), expands disclosures about fair value measurements, and applies under other accounting pronouncements that require or permit fair value measurements. SFAS No. 157 does not require any new fair value measurements, however the FASB anticipates that for some entities, the application of SFAS No. 157 will change current practice. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. We are currently reviewing the effect, if any, SFAS 157 will have on our financial statements.

In February 2007, the FASB issued SFAS No. 159 (“SFAS 159”), “The Fair Value Option for Financial Assets and Liabilities including in amendment of SFAS 115”. This Statement permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement objectives for accounting for financial instruments. This Statement is effective as of the beginning of an entity’s first fiscal year that begins after November15, 2007, and interim periods within those fiscal years. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of FASB Statement No. 157, “Fair Value Measurements”.  We are currently evaluating the impact of SFAS No. 159 on our financial statements.

In December 2007, the FASB issued SFAS No. 141R (revised 2007), “Business Combinations”. Although this statement amends and replaces SFAS No. 141, it retains the fundamental requirements in SFAS No. 141 that (i) the purchase method of accounting must be used for all business combinations; and (ii) an acquirer be identified for each business combination. SFAS No. 141R defines the acquirer as the entity that obtains control of one or more businesses in the business combination and establishes the acquisition date as the date that the acquirer achieves control. This Statement applies to all transactions or other events in which an entity (the acquirer) obtains control of one or more businesses (the acquiree), including combinations achieved without the transfer of consideration; however, this Statement does not apply to a combination between entities or businesses under common control. Significant provisions of SFAS No. 141R concern principles and requirements for how an acquirer (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree; (ii) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (iii) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This Statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008 with early adoption not permitted. Management is assessing the impact of the adoption of SFAS No. 141R.

F-10

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

In December 2007, the FASB issued SFAS No. 160, “Non-Controlling Interests in Consolidated Financial Statements”. This Statement amends ARB 51 to establish accounting and reporting standards for the non-controlling (minority) interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a non-controlling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. We have not yet determined the impact, if any, that SFAS No. 160 will have on our financial statements.

Reclassifications

Certain reclassifications have been made to prior periods to conform to current presentation.

Note 2 — Stock Transactions

Stock transactions in fiscal 2007

Pursuant to the merger with Millennium Plastics Corporation the shareholders of Millennium Plastics Corporation retained 60,131 shares of our stock.

We sold 153,600 shares of our common stock at $3.00 per share. We paid a fee of $46,000 to an individual who assisted us in obtaining capital resulting in net proceeds of $414,800. The fee was offset against the paid in capital recorded in this transaction.

We agreed to issue 151,000 shares of our common stock for services provided to us and liabilities assumed in the merger with Millennium. The shares were valued at a price of $3.00 and $5.00 per share. We used the price per share based on the price of our common stock at the date of the agreement to issue shares. In the year ended March 31, 2007, we expensed $138,000 related to these transactions. At March 31, 2007, there was $4,000 that was not expensed relating to these transactions, and we expensed this in fiscal 2008. At March 31, 2007, 3,000 of these shares were owed but unissued, and we recorded $3.00 as the par value of the unissued shares. The shares were issued in fiscal 2008.

We amended a joint exploration agreement with an entity that holds leases on properties and issued 64,000 of our shares in lieu of cash. The shares were valued at $200,000. We used the price per share based on recently sold shares. We recorded this as oil and gas properties not subject to amortization.

Stock transactions in fiscal 2008

We issued 1,920 shares of common stock to a director and chairman of our audit committee for services over the next year. For the year ended March 31, 2008, we recorded $11,000 in expense for this agreement and $4,000 in expense for an agreement entered into in fiscal 2007.

We issued 1,800,000 shares of our common stock pursuant to our “Securities Purchase Agreements.” We allocated $4,500,000 of the $9,000,000 received for the stock and loan to the equity portion of the transaction (See Note 4). The transaction costs of the equity sale were $466,835, however, $280,591 of the cost was the value of warrants issued in connection with the agreement.

Option and Warrant transactions

Officers (including officers who are members of the board of directors), directors, employees and consultants are eligible to receive options under our stock option plans. We administer the stock option plans and we determine those persons to whom options will be granted, the number of options to be granted, the provisions applicable to each grant and the time periods during which the options may be exercised. No options may be granted more than ten years after the date of the adoption of the stock option plans.

F-11

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

Each option granted under the stock option plans will be exercisable for a term of not more than ten years after the date of grant. Certain other restrictions will apply in connection with the plans when some awards may be exercised. In the event of a change of control (as defined in the stock option plans), the vesting date on which all options outstanding under the stock option plans may first be exercised will be accelerated. Generally, all options terminate 90 days after a change of control.

2000/2001 Stock Option Plan

The board of directors approved a stock option plan and our stockholders ratified the plan on September 25, 2000. The total number of options that can be granted under the plan is 200,000 shares. At March 31, 2008, we had granted 200,000 non-qualified options under this plan.

Stock Option Plan

On May 4, 2007, we amended and restated the EnerJex Resources, Inc. Stock Option Plan to rename the plan and to increase the number of shares issuable under the plan to 1,000,000. Our stockholders approved this plan in September of 2007. At March 31, 2008 we had granted 258,500 non-qualified options under this plan.

Option transactions in fiscal 2007

We granted 60,000 stock options in the year ended March 31, 2007. These options vested at 20,000 per year. The options had an exercise price of $5.00 per share and were to expire on August 15, 2011. The value of the options was based on the Black-Scholes pricing model and totaled $99,000 based on the following assumptions: stock price-$3.00; exercise price-$5.00; life- 5 years; volatility-76%; yield-4.81%. For the year ended March 31, 2007, we recorded $37,813 as compensation expense and the remaining amount of expense on these options was $61,187.

The weighted average grant date fair value of the options granted in the year ended March 31, 2007 was $1.65.

The 60,000 options were cancelled in the year ended March 31, 2008.

Option transactions in fiscal 2008

The unvested option issued in the year ended March 31, 2007, was unexercised and cancelled in accordance with a separation agreement. We recognized the remaining expense ($61,187) relating to the options in the year ended March 31, 2008.

We granted 458,500 options in the year ended March 31, 2008. 30,000 of the options were for services earned over a one-year period. We measured the compensation cost of the options based on the vesting and the market value as determined by the Black-Scholes pricing model.

For the year ended March 31, 2008, we included as expense $1,977,761 relating to the value of vested options. At March 31, 2008, we have $81,778 in charges to future expense relating to the unamortized cost of options that were issued in accordance with contracts that covered a period of one year, which will be expensed in fiscal 2009.

The fair value of each option award is estimated on the date of grant using the assumptions noted in the following table. Volatility is based on the historical volatility of stock trading, expected term was the estimated exercise period, risk free rate was the rate of a U.S. Treasury instrument of the time period in which the options would be outstanding, and dividend rate was estimated to be zero as we cannot assume that there will be any future dividends.

F-12

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

Weighted average expected volatility	101	%
Weighted average expected term (in years)	3.95
Weighted average expected dividends	0	%
Weighted average risk free rate	4.42	%

The weighted average grant date fair value of the options granted in the year ended March 31, 2008 was $4.35

In the year ended March 31, 2008, we granted warrants to purchase 75,000 shares of our common stock as partial payment for services rendered in connection with our financing activities. The warrants have an exercise price of $3.00 and expire on April 11, 2010. The fair value of the warrants based on the Black-Scholes pricing model totaled $280,591 (approximately $3.75 per warrant). The following assumptions were used in the valuation: stock price-$5.00; exercise price-$3.00; life- 3 years; volatility- 106%; yield-4.66%. We have included the value of the warrants with the loan and equity transaction costs (See Note 4).

A summary of stock options and warrants is as follows:

				Weighted Ave.				Weighted Ave.
	Options			Exercise Price		Warrants		Exercise Price
Outstanding April 1, 2006		—			—		—		—
Granted		60,000		$	5.00		—		—
Cancelled		—			—		—		—
Exercised		—			—		—		—
Outstanding March 31, 2007		60,000		$	5.00		—		—
Outstanding April 1, 2007		60,000		$	5.00		—		—
Granted		458,500		$	6.30		75,000	$	3.00
Cancelled		(60,000	)	$	5.00		—		—
Exercised		—			—		—		—
Outstanding March 31, 2008		458,500		$	6.30		75,000	$	3.00

Note 3 — Asset Retirement Obligation

Our asset retirement obligations relate to the abandonment of oil and natural gas wells. The amounts recognized are based on numerous estimates and assumptions, including future retirement costs, inflation rates and credit adjusted risk-free interest rates. The following shows the changes in asset retirement obligations:

Asset retirement obligation at April 1, 2006	$	22,038
Liabilities incurred during the period		—
Liabilities settled during the period		—
Accretion		1,870
Asset retirement obligations, March 31, 2007		23,908
Liabilities incurred during the period		405,450
Liabilities settled during the period		—
Accretion		30,331
Asset retirement obligations, March 31, 2008	$	459,689

F-13

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

Note 4 — Long-Term Debt and Convertible Debt

On April 11, 2007, we entered into a Securities Purchase Agreement, Registration Rights Agreements, Senior Secured Debentures, a Pledge and Security Agreement, a Secured Guaranty, and other related agreements (the “Financing Agreements”) with the “Buyers”. Pursuant to the Financing Agreements, we authorized a new series of senior secured debentures (the “Debentures”). Under the terms of the Financing Agreements, we agreed to sell Debentures for a total purchase price of $9.0 million. In connection with the purchase, we agreed to issue to each of the Buyers one share of our common stock for each dollar purchased for a total issuance of 1,800,000 shares. The first closing occurred on April 12, 2007 with a total of $6.3 million in Debentures being sold and the remaining $2.7 million closing on June 21, 2007.

The Debentures have a three-year term, maturing on March 31, 2010, and bear interest at a rate equal to 10% per annum. Interest is payable quarterly in arrears on the first day of each succeeding quarter. We may pay interest in either cash or registered shares of our common stock. The Debenture has no prepayment penalty so long as we maintain an effective registration statement with the Securities Exchange Commission and provided we give six (6) business days prior notice of redemption to the Buyers. The Debentures are guaranteed, pursuant to the “Secured Guaranty” and “Pledge and Security Agreement” by us and secured by a security interest in all of our assets and assignments of production, other than our Gas City Project.

Pursuant to the agreements, during the term of the Debentures, we are required to produce a minimum average daily quantity of oil and natural gas. The production thresholds will be measured at six-month intervals beginning December 31, 2007 and ending on September 30, 2009. In the event that for any Measurement Date specified above, we do not meet the production thresholds applicable to such Measurement Date, then we shall issue to the Buyers an aggregate 600,000 shares of common stock for each threshold date (up to 2,400,000 shares total). Each Buyer may elect to receive common stock purchase warrants in lieu of its allocation of shares of common stock. Such warrants shall have an exercise price of $0.05 per share and be exercisable for a four-year term. As of March 31, 2008, we have met our initial production threshold and we believe our future production levels will be sufficient to meet the subsequent required threshold levels.

Pursuant to the terms of the Registration Rights Agreement between us and the Buyers, we are obligated to file a minimum of three registration statements registering the 1,800,000 shares of common stock or shares of common stock underlying the common stock purchase warrants, 600,000 interest shares potentially due under the Debentures, and up to 2,400,000 production threshold shares. If we fail to obtain and maintain effectiveness of a registration statement, we will be obligated to pay cash to each Buyer equal to: (i) 0.5% of the aggregate purchase price allocable to such Buyer’s securities included in such registration statement for the first 30 day period following such effectiveness failure or maintenance failure, (ii) 0.75% of the aggregate Purchase price allocable to such Buyer’s securities in such registration statement for the following thirty day period; and (iii) 1% of the aggregate purchase price allocable to such Buyer’s securities included in the registration statement for every thirty day period thereafter. These payments are capped at 10% of the Buyer’s original purchase price under the Debentures. The first registration statement, registering 600,000 shares of common stock, became effective on August 14, 2007 and the second became effective January 11, 2008.

The proceeds from the Debentures were allocated to the long-term debt and the stock issued based on the fair market value of each item that we calculated to be $9.0 million for each item. Since each of the instruments had a value equal to 50% of the total, we allocated $4.5 million to stock and $4.5 million to the note. The loan discount costs of $4.5 million will accrete as interest based on the interest method over the period of issue to maturity. The amount of interest accreted for the period ended March 31, 2008 was $1,089,798. The remaining amount of interest to accrete in future periods is $3,410,202 as of March 31, 2008.

We incurred debt issue costs totaling $466,835. The debt issue costs are initially recorded as assets and are amortized to expense on a straight-line basis over the life of the loan. The amount expensed in the year

F-14

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

ended March 31, 2008 was $152,453. The remaining debt issue costs will be expensed in the following fiscal years: March 31, 2009 -$157,191 and March 31, 2010 -$157,191.

We obtained a note payable to a bank of $1,735,000 maturing in October 2011 with an interest rate of 8.5% that is collateralized by some of our oil and gas leases and assets.

We financed the purchase of vehicles through a bank. The notes are for seven years and the weighted average interest is 6.99% per annum. Vehicles collateralize these notes.

Long-term debt consists of the following at March 31, 2008:

Long-term debentures	$	9,000,000
Unaccreted discount		(3,410,202	)
Total		5,589,798
Note payable to bank		1,549,029
Vehicle notes payable		106,075
Total long-term debt		7,244,902
Less current portion		412,930
Long-term debt	$	6,831,972

On August 3, 2006, we sold a $25,000 convertible note that has an interest rate of 6% and matures August 2, 2010. The note is convertible at any time at the option of the note holder into shares of our common stock at a conversion rate of $10.00 per share.

Principal amounts are due on long-term and convertible debt as follows: Year ended March 31, 2009 -$412,930, March 31, 2010 -$9,475,406, March 31, 2011 -$490,404, March 31, 2012 -$271,232, March 31, 2013 -$11,027 and thereafter-$19,105.

Note 5 — Oil and Gas Properties

On April 9, 2007, we entered into a “Joint Exploration Agreement” with a shareholder, MorMeg, LLC, whereby we agreed to advance $4.0 million to a joint operating account for further development of MorMeg’s Black Oaks leaseholds in exchange for a 95% working interest in the Black Oaks Project. We will maintain our 95% working interest until payout, at which time the MorMeg 5% carried working interest will be converted to a 30% working interest and our working interest becomes 70%. Payout is generally the point in time when the total cumulative revenue from the project equals all of the project’s development expenditures and costs associated with funding. We have until November 30, 2008 to contribute additional capital toward the Black Oaks Project development. If we elect not to contribute further capital to the Black Oaks Project prior to the project’s full development while it is economically viable to do so, or if there is more than a thirty day delay in project activities due to lack of capital, MorMeg has the option to cease further joint development and we will receive an undivided interest in the Black Oaks Project. The undivided interest will be the proportionate amount equal to the amount that our investment bears to our investment plus $2.0 million, with MorMeg receiving an undivided interest in what remains.

On April 18, 2007, we entered into a “Purchase and Sale Agreement” with MorMeg, LLC, a shareholder, to acquire the lease interests of certain producing properties for cash in the amount of $400,000.

In August of 2007, we entered into a development agreement with Euramerica to further the development and expansion of the Gas City Project, which included 6,600 acres, whereby Euramerica contributed $524,000 in capital toward the project. Euramerica was granted an option to purchase this project for $1.2 million with a requirement to invest an additional $2.0 million for project development by August 31, 2008. We are the operator of the project at a cost plus 17.5% basis. We received $300,000 in the year ended March 31, 2008

F-15

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

(and an additional $300,000 subsequent to year end) of the $1.2 million purchase price. We also received $250,000 of the $2.0 million development funds in the year ended March 31, 2008 (and an additional $250,000 subsequent to year end). We recorded a reduction of $300,000 to our oil & gas properties using full-cost accounting subject to amortization in the year ended March 31, 2008 and will further reduce this account when we receive the remaining $600,000 in proceeds in fiscal 2009. Upon payment of the entire purchase price, Euramerica will be assigned a 95% working interest, and we will retain a 5% carried working interest before payout. When the project reaches payout, our 5% carried working interest will increase to a 25% working interest, and Euramerica will have a 75% working interest. At March 31, 2008 we have recorded $251,951 in deferred payments from Euramerica development.

On September 14, 2007, we entered into a purchase agreement for the acquisition of nearly a 100% working interest in leaseholds located in three counties in eastern Kansas for a cash purchase price of $800,000.

On September 27, 2007, we entered into a purchase and sale agreement with shareholders to acquire oil leases in eastern Kansas for a purchase price of $2.7 million.

In the fiscal year ended March 31, 2007, we incurred impairment charges on our oil and natural gas properties of $273,959. The impairment represented all of our oil and gas cost accounted for under the full-cost method that was subject to amortization. We took this impairment based on the full-cost method ceiling test.

Note 6 — Related Party Transactions

In the year ended March 31, 2007, we entered into an agreement with a shareholder to sell the patent we received in the Millennium merger for $10,000.

In the year ended March 31, 2008, we entered into a “Separation Agreement” with our former chief financial officer. Pursuant to the agreement, we agreed to pay a total of $56,000 as severance subject to payment in full of an outstanding promissory note in the amount of $22,000 and accrued interest.

Note 7 — Commitments and Contingencies

We have a lease agreement that expires in July, 2008. Future minimum payments are $20,500 for the year ending March 31, 2009.

Pursuant to the agreements, during the term of the Debentures, we are required to produce a minimum average daily quantity of oil and natural gas. The production thresholds will be measured at six-month intervals beginning December 31, 2007 and ending on September 30, 2009. In the event that for any Measurement Date specified above, we do not meet the production thresholds applicable to such Measurement Date, then we shall issue to the Buyers an aggregate 600,000 shares of common stock for each threshold date (up to 2,400,000 shares total). Each Buyer may elect to receive common stock purchase warrants in lieu of its allocation of shares of common stock. Such warrants shall have an exercise price of $0.05 per share and be exercisable for a four-year term. As of March 31, 2008, we have met our initial production threshold and we believe our future production levels will be sufficient to meet the subsequent required threshold levels.

F-16

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

Note 8 — Income Taxes

Deferred income taxes are determined based on the tax effect of items subject to different treatment between book and tax bases. At March 31, 2008, there is approximately $7,147,000 of net operating loss carry-forwards expiring in 2021-2023. The net deferred tax is as follows:

	March 31,			March 31,
	2008			2007
Non-current deferred tax asset:
Impaired oil & gas costs and long-lived assets	$	312,800		$	—
Net operating loss carry-forward		2,429,900			908,000
Valuation allowance		(2,742,700	)		(908,000	)
Total deferred tax net	$	—		$	—

A reconciliation of the provision for income taxes to the statutory federal rate for continuing operations is as follows:

	March 31,			March 31,
	2008			2007
Statutory tax rate		34	%		34	%
Equity based compensation		(15	)%		—
Oil & gas costs and long-lived assets		1	%		—
Change in valuation allowance		(20	)%		(34	)%
Effective tax rate		0	%		0	%

Note 9 — Notes Payable

We have promissory notes payable relating to the acquisition of leases totaling $965,000. Each promissory note bears interest at a rate of 5% per annum and matures September 1, 2008. Collateral for these notes are DD Energy oil and gas leases.

At March 31, 2007 we had a note payable to a bank totaling $350,000. The note had an interest rate of 9% and was secured by substantially all of our assets. The principal and interest was paid on April 18, 2007.

Note 10 — Impairment of Goodwill

In the year ended March 31, 2007 we impaired goodwill and recorded an expense of $677,000. The goodwill resulted from the Millennium merger and we performed a goodwill impairment test. This test required the allocation of goodwill and all other assets and liabilities to an assigned reporting unit. The fair value of the unit was determined in the year ended March 31, 2007 and compared to the book value of the unit. The fair value of the reporting unit was determined to be zero as there were no revenues or assets therefore we were required to impair the goodwill as expense.

Note 11 — Subsequent Events

On March 6, 2008, we entered into an agreement with Shell whereby we agreed to an 18-month fixed-price delivery contract with Shell for 130 BOPD at a fixed price per barrel of $96.90, less transportation costs. This contract is for the physical delivery of oil under our normal sales. This represented approximately 60% of our total current oil production on a net revenue basis at that time and represents approximately $6.8 million in gross revenue before the deductions of transportation costs over the 18 -month period. In addition, we agreed to sell all of our remaining oil production at current spot market pricing beginning April 1, 2008 through September 30, 2009 to Shell.

On April 9, 2008, we borrowed $500,000 from a bank at 8% interest due August 27, 2009.

F-17

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

On May 15, 2008, we issued 2,182 shares to a Director for serving as the chairman of our audit committee.

We received $300,000 from Euramerica towards the purchase of the properties and $250,000 for development after March 31, 2008.

On July 3, 2008, we entered a new three-year $50 million senior secured credit facility with Texas Capital Bank, N. A. with an initial borrowing base of $10.75 million based on our current proved oil and natural gas reserves. We used our initial borrowing under this facility of $10.75 million to redeem an aggregate principal amount of $6.3 million of our 10% debentures, assign approximately $2.0 million of our existing indebtedness with another bank to this facility, repay $965,000 of seller-financed notes, pay the transaction costs, fees and expenses of this new facility and expand our current development projects, including the completion of 31 new oil wells that have been drilled since May of 2008.

As of July 3, 2008, we entered into an ISDA master agreement and a costless collar with BP Corporation North American Inc., or BP, for 130 barrels of oil per day with a price floor of $132.50 per barrel and a price ceiling of $155.70 per barrel for NYMEX West Texas Intermediate for the period of October 1, 2009 until March 31, 2011.

On July 7, 2008, we amended the $2.7 million of aggregate principal amount of our 10% debentures that remain outstanding to, among other things, permit the indebtedness under our new credit facility, subordinate the security interests of the debentures to the new credit facility, provide for the redemption of the remaining debentures with the net proceeds from our next debt or equity offering, and eliminate the covenant to maintain certain production thresholds.

Note 12 — Supplemental Oil and Natural Gas Reserve Information (Unaudited)

Results of Operations from Oil and Natural Gas Producing Activities

The following table shows the results of operations from the Company’s oil and gas producing activities. Results of operations from these activities are determined using historical revenues, production costs and depreciation, depletion and amortization of the capitalized costs subject to amortization. General and administrative expenses, professional, investor relations and interest expense is excluded from this determination.

	March 31,			March 31,
	2008			2007
Production revenues	$	3,602,798		$	90,800
Production costs		(1,795,188	)		(172,417	)
Depletion and depreciation		(913,224	)		(11,477	)
Results of operations for producing activities	$	894,386		$	(93,094	)

Capitalized Costs of Oil and Natural Gas Producing Properties

The Company’s aggregate capitalized costs related to oil and natural gas producing activities are as follows:

	March 31,			March 31,
	2008			2007
Proved	$	10,207,596		$	11,862
Unevaluated and unproved		62,216			322,178
Accumulated depreciation and depletion		(925,086	)		(11,862	)
Sale of properties		(300,000	)		—
Net capitalized costs	$	9,044,726		$	—

F-18

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

For the year ended March 31, 2007, we have impaired all of our capitalized costs subject to depletion because of the ceiling test of the full-cost method.

Unproved and unevaluated properties are not included in the full-cost pool and are therefore not subject to depletion or depreciation. These assets consist primarily of leases that have not been evaluated. We will continue to evaluate our unproved and unevaluated properties; however, the timing of such evaluation has not been determined.

Capitalized Costs Incurred for Oil and Natural Gas Producing Activities

Costs incurred in oil and natural gas property acquisition, exploration and development activities that have been capitalized are summarized below:

	March 31,		March 31,
	2008		2007
Acquisition of proved and unproved properties	$	4,352,040	$	304,080
Development costs		5,178,281		—
Exploration costs		—		—
Total	$	9,530,321	$	304,080

Gas and Oil Reserve Quantities

Our ownership interests in estimated quantities of proved oil and gas reserves and changes in net proved reserves all of which are located in the United States are summarized below. Proved reserves are estimated quantities of natural gas and oil that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions. Proved developed reserves are those that are expected to be recovered through existing wells with existing equipment and operating methods. Reserves are stated in thousand cubic feet (mcf) of natural gas and barrels (stb) of oil. Geological and engineering estimates of proved natural gas and oil reserves at one point in time are highly interpretive, inherently imprecise and subject to ongoing revisions that may be substantial in amount. Although every reasonable effort is made to ensure that the reserve estimates are accurate, by their nature reserve estimates are generally less precise than other estimates presented in connection with financial statement disclosures.

	March 31,						March 31,
	2008						2007
	Gas-mcf			Oil-stb			Gas-mcf			Oil-stb
Proved reserves:		—			—			229,517			—
Revisions of previous estimates		—			—			(212,077	)		—
Purchase of minerals in place		418,959			347,228			—			—
Extensions and discoveries		—			1,068,683			—			—
Production		(17,762	)		(43,697	)		(17,440	)		—
Total		401,197			1,372,214			—			—

Proved developed reserves at the end of the period:

Gas-mcf		Oil-stb
March 31,		March 31,
2008		2008
	401,197		861,240

F-19

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

Gas-mcf		Oil-stb
March 31,		March 31,
2007		2007
	—		—

Standardized Measure of Discounted Future Net Cash Flows

The standardized measure of discounted future net cash flows from our proved reserves for the periods presented in the financial statements is summarized below. There were no proved reserves at March 31, 2007. The standardized measure of future cash flows as of March 31, 2008 is calculated using a price per Mcf of gas of $7.479 and a price for oil of $94.53 each of which was the price received from our production at March 31, 2008. The resulting estimated future cash inflows are reduced by estimated future costs to develop and produce the estimated proved reserves. These costs are based on year-end cost levels. Future income taxes are based on year-end statutory rates. The future net cash flows are reduced to present value by applying a 10% discount rate. The standardized measure of discounted future cash flows is not intended to represent the replacement cost or fair market value of the Company’s oil and gas properties.

	March 31,			March 31,
	2008			2007
Future production revenue	$	132,457,459		$	240,000
Future production costs		(39,629,625	)		(240,000	)
Future development costs		(18,827,013	)		—
Future cash flows before income taxes		74,000,821			—
Future income taxes		(19,241,954	)		—
Future net cash flows		54,758,867			—
10% annual discount for estimating of future cash flows		(26,558,364	)		—
Standardized measure of discounted net cash flows	$	28,200,503		$	—

Changes in Standardized Measure of Discounted Future Net Cash Flows

	March 31,			March 31,
	2008			2007
Balance beginning of year	$	—		$	244,000
Sales, net of production costs		(1,777,278	)		(18,000	)
Net change in pricing and production costs		—			(60,000	)
Net change in future estimated development costs		—			(90,000	)
Purchase of minerals in place		8,124,394			—
Extensions and discoveries		21,853,387			—
Revisions		—			(77,000	)
Accretion of discount		—			1,000
Change in income tax		—			—
Balance end of year	$	28,200,503		$	—

F-20

EnerJex Resources, Inc. and Subsidiaries

Consolidated Balance Sheets

	June 30,			March 31,
	2008			2008
	(Unaudited)			(Audited)
ASSETS
Current assets:
Cash	$	1,044,361		$	951,004
Accounts receivable		1,030,388			227,055
Prepaid debt issue costs		157,191			157,191
Deposits and prepaid expenses		378,454			176,345
Total current assets		2,610,394			1,511,595
Fixed assets		243,925			185,299
Less: Accumulated depreciation		39,859			30,982
Total fixed assets		204,066			154,317
Other assets:
Prepaid debt issue costs		117,893			157,191
Oil and gas properties using full-cost accounting:
Properties not subject to amortization		3,200			62,216
Properties subject to amortization		9,404,474			8,982,510
Total other assets		9,525,567			9,201,917
Total assets	$	12,340,027		$	10,867,829
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1,602,519		$	416,834
Accrued liabilities		293,728			70,461
Notes payable		965,000			965,000
Deferred payments from Euramerica development		—			251,951
Long-term debt, current		517,284			412,930
Total current liabilities		3,378,531			2,117,176
Asset retirement obligation		557,633			459,689
Convertible note payable		25,000			25,000
Long-term debt, net of discount of $3,067,376 and $3,410,202		7,520,120			6,831,972
Total liabilities		11,481,284			9,433,837
Contingencies and commitments
Stockholders’ equity:
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $0.001 par value, 100,000,000 shares authorized; shares issued and outstanding — 4,442,833 at June 30, 2008 and 4,440,651 at March 31, 2008		4,443			4,441
Paid in capital		8,910,006			8,853,457
Retained (deficit)		(8,055,706	)		(7,423,906	)
Total stockholders’ equity		858,743			1,433,992
Total liabilities and stockholders’ equity	$	12,340,027		$	10,867,829

See Notes to Consolidated Financial Statements.

G-1

EnerJex Resources, Inc. and Subsidiaries

Consolidated Statements of Operations

	For the Three Months Ended
	June 30,
	(Unaudited)
	2008			2007
Oil and natural gas revenues	$	1,690,086		$	146,203
Expenses:
Direct operating costs		714,534			59,042
Depreciation, depletion and amortization		370,190			14,245
Professional fees		143,678			874,505
Salaries		217,487			1,122,190
Administrative expense		219,487			129,937
Total expenses		1,665,376			2,199,919
Income (loss) from operations		24,710			(2,053,716	)
Other income (expense):
Interest expense		(274,386	)		(69,742	)
Loan fee expense		(39,298	)		(34,560	)
Loan interest accretion		(342,826	)		(175,766	)
Loan penalty expense		—			(2,126,271	)
Total other income (expense)		(656,510	)		(2,406,339	)
Net (loss)	$	(631,800	)	$	(4,460,055	)
Net (loss) per share of common stock-basic and fully diluted	$	(0.14	)	$	(1.16	)
Weighted average shares outstanding		4,471,754			3,832,702

See Notes to Consolidated Financial Statements.

G-2

EnerJex Resources, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

	For the Three Months Ended
	June 30,
	(Unaudited)
	2008			2007
Cash flows from operating activities
Net (loss)	$	(631,800	)	$	(4,460,055	)
Depreciation and depletion		379,067			16,464
Amortization of stock and options for services		56,551			1,807,871
Loan penalty costs		—			2,126,271
Loan costs and accretion of interest		382,124			210,326
Accretion of asset retirement obligation		13,544			507
Adjustments to reconcile net (loss) to cash provided by (used in) operating activities:
Accounts receivable		(803,333	)		(141,426	)
Deposits and prepaid expenses		(202,109	)		(25,780	)
Accounts payable		1,185,685			144,743
Accrued liabilities		223,267			(58,251	)
Deferred payment from Euramerica for development		(251,951	)		—
Cash provided by (used in) operating activities		351,045			(379,330	)
Cash flows from investing activities
Purchase of fixed assets		(58,626	)		(13,841	)
Additions to oil & gas properties		(948,937	)		(1,586,601	)
Sale of oil & gas properties		300,000			—
Cash used in investing activities		(707,563	)		(1,600,442	)
Cash flows from financing activities
Proceeds from sales of common stock		—			4,313,757
Notes payable, net		—			(350,000	)
Borrowings from long-term debt		523,442			4,033,165
Payments on long-term debt		(73,567	)		—
Payments received on notes receivable		—			23,100
Cash provided by financing activities		449,875			8,020,022
Increase (decrease) in cash and cash equivalents		93,357			6,040,250
Cash and cash equivalents, beginning		951,004			99,493
Cash and cash equivalents, end	$	1,044,361		$	6,139,743
Supplemental disclosures:
Interest paid	$	39,073		$	75,935
Income taxes paid	$	—		$	—
Non-cash transactions:
Share-based payments issued for services	$	—		$	2,018,655
Asset retirement obligation	$	84,400		$	102,000

See Notes to Consolidated Financial Statements.

G-3

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Note 1 — Basis of Presentation

The unaudited consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and reflect all adjustments which, in the opinion of management, are necessary for a fair presentation. All such adjustments are of a normal recurring nature. The results of operations for the interim period are not necessarily indicative of the results to be expected for a full year. Certain amounts in the prior year statements have been reclassified to conform to the current year presentations. The statements should be read in conjunction with the financial statements and footnotes thereto included in our Form 10-K for the fiscal year ended March 31, 2008.

Our consolidated financial statements include the accounts of our wholly-owned subsidiaries, EnerJex Kansas, Inc. and DD Energy, Inc. All intercompany transactions and accounts have been eliminated in consolidation.

Effective on July 25, 2008, we implemented a one-for-five reverse split of our issued and outstanding common stock (See Note 7). All share and per share data in these consolidated financial statements and related notes hereto have been retroactively adjusted to account for the effect of the reverse stock split for all periods presented. The reverse split did not affect the authorized shares and par value per share.

Note 2 — Common Stock

Stock transactions in fiscal 2009:

On May 15, 2008, we issued 2,182 shares of common stock to a Director and chairman of our Audit Committee for services over the next year. We recorded director compensation in the amount of $13,000.

A summary of stock options and warrants is as follows:

			Weighted Ave.				Weighted Ave.
	Options		Exercise Price		Warrants		Exercise Price
Outstanding March 31, 2008		458,500	$	6.30		75,000	$	3.00
Granted		—		—		—		—
Cancelled		—		—		—		—
Exercised		—		—		—		—
Outstanding June 30, 2008		458,500	$	6.30		75,000	$	3.00

Note 3 — Asset Retirement Obligation

Our asset retirement obligations relate to the abandonment of oil and natural gas wells. The amounts recognized are based on numerous estimates and assumptions, including future retirement costs, inflation rates and credit adjusted risk-free interest rates. The following shows the changes in asset retirement obligations:

	June 30,
	2008
Asset retirement obligation, beginning of period	$	459,689
Liabilities incurred during the period		84,400
Liabilities settled during the period		—
Accretion		13,544
Asset retirement obligations, end of period	$	557,633

G-4

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

(Unaudited)

Note 4 — Long-Term Debt and Convertible Debt

On April 11, 2007, we entered into a Securities Purchase Agreement, Registration Rights Agreements, Senior Secured Debentures, a Pledge and Security Agreement, a Secured Guaranty, and other related agreements (the “Financing Agreements”) with the “Buyers” of a new series of senior secured debentures (the “Debentures”). Under the terms of the Financing Agreements, we agreed to sell Debentures for a total purchase price of $9.0 million. In connection with the purchase, we agreed to issue to the Buyers a total of 1,800,000 shares. The first closing occurred on April 12, 2007 with a total of $6.3 million in Debentures being sold and the remaining $2.7 million closing on June 21, 2007.

The Debentures have a three-year term, maturing on March 31, 2010, and bear interest at a rate equal to 10% per annum. Interest is payable quarterly in arrears on the first day of each succeeding quarter. We may pay interest in either cash or registered shares of our common stock. The Debentures have no prepayment penalty so long as we maintain an effective registration statement with the Securities Exchange Commission and provided we give six (6) business days prior notice of redemption to the Buyers.

Effective July 7, 2008, we redeemed an aggregate principal amount of $6.3 million of the Debentures and amended the $2.7 million of aggregate principal amount of the remaining Debentures to, among other things, permit the indebtedness under our new credit facility, subordinate the security interests of the debentures to the new credit facility, provide for the redemption of the remaining Debentures with the net proceeds from our next debt or equity offering and eliminate the covenant to maintain certain production thresholds (See Note 7).

Pursuant to the terms of the Registration Rights Agreement, as amended, between us and one of the Buyers, we are obligated to maintain an effective registration statement for 1,000,000 of the shares issued under the Financing Agreements. If we fail to obtain and maintain effectiveness of the registration statement before October 22, 2008, we will be obligated to pay cash to the Buyer equal to 1.5% of the aggregate purchase price allocable to such Buyer’s securities ($2,500,000) included in the registration statement for each 30 day period following such effectiveness failure or maintenance failure. These payments are capped at 10% of the Buyer’s original purchase price under the Debentures.

The proceeds from the Debentures were allocated to the long-term debt and the stock issued based on the fair market value of each item that we calculated to be $9.0 million for each item. Since each of the instruments had a value equal to 50% of the total, we allocated $4.5 million to stock and $4.5 million to the note. The loan discount costs of $4.5 million will accrete as interest based on the interest method over the period of issue to maturity. The amount of interest accreted for the period ended June 30, 2008 was $342,826 and for the period ended June 30, 2007 was $175,766. The remaining amount of interest to accrete in future periods is $3,067,376 as of June 30, 2008.

We incurred debt issue costs totaling $466,835. The debt issue costs are initially recorded as assets and are amortized to expense on a straight-line basis over the life of the loan. The amount expensed in the three month period ended June 30, 2008 was $39,298. The remaining debt issue costs will be expensed in the following fiscal years: March 31, 2009 -$117,893 and March 31, 2010 -$157,191.

We obtained a note payable to a bank of $1,735,000 maturing in October 2011 with an interest rate of 8.5% that is collateralized by some of our oil and gas leases and assets.

We financed the purchase of vehicles through a bank. The notes are for seven years and the weighted average interest is 6.99% per annum. Vehicles collateralize these notes.

G-5

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

(Unaudited)

Long-term debt consists of the following at June 30, 2008:

Long-term debentures	$	9,000,000
Unaccreted discount		(3,067,376	)
Total		5,932,624
Note payable to bank		2,001,116
Vehicle notes payable		103,664
Total long-term debt		8,037,404
Less current portion		517,284
Long-term debt	$	7,520,120

On August 3, 2006, we sold a $25,000 convertible note that has an interest rate of 6% and matures August 2, 2010. The note is convertible at any time at the option of the note holder into shares of our common stock at a conversion rate of $10.00 per share.

Note 5 — Oil and Gas Properties

On April 9, 2007, we entered into a “Joint Exploration Agreement” with a shareholder, MorMeg, LLC, whereby we agreed to advance $4.0 million to a joint operating account for further development of MorMeg’s Black Oaks leaseholds in exchange for a 95% working interest in the Black Oaks Project. We will maintain our 95% working interest until payout, at which time the MorMeg 5% carried working interest will be converted to a 30% working interest and our working interest becomes 70%. Payout is generally the point in time when the total cumulative revenue from the project equals all of the project’s development expenditures and costs associated with funding. We have until November 30, 2008 to contribute additional capital toward the Black Oaks Project development. If we elect not to contribute further capital to the Black Oaks Project prior to the project’s full development while it is economically viable to do so, or if there is more than a thirty day delay in project activities due to lack of capital, MorMeg has the option to cease further joint development and we will receive an undivided interest in the Black Oaks Project. The undivided interest will be the proportionate amount equal to the amount that our investment bears to our investment plus $2.0 million, with MorMeg receiving an undivided interest in what remains.

On April 18, 2007, we entered into a “Purchase and Sale Agreement” with MorMeg to acquire the lease interests of certain producing properties for cash in the amount of $400,000.

In August of 2007, we entered into a development agreement with Euramerica to further the development and expansion of the Gas City Project, which included 6,600 acres, whereby Euramerica contributed $524,000 in capital toward the project. Euramerica was granted an option to purchase this project for $1.2 million with a requirement to invest an additional $2.0 million for project development by August 31, 2008. We are the operator of the project at a cost plus 17.5% basis. We received $300,000 in the year ended March 31, 2008 (and an additional $300,000 in the quarter ended June 30, 2008) of the $1.2 million purchase price. We also received $250,000 of the $2.0 million development funds in the year ended March 31, 2008 (and an additional $250,000 in the quarter ended June 30, 2008). We recorded a reduction of $300,000 to our oil & gas properties using full-cost accounting subject to amortization in the year ended March 31, 2008 and will further reduce this account when we receive the remaining $600,000 in proceeds in fiscal 2009. Upon payment of the entire purchase price, Euramerica will be assigned a 95% working interest, and we will retain a 5% carried working interest before payout. When the project reaches payout, our 5% carried working interest will increase to a 25% working interest, and Euramerica will have a 75% working interest.

G-6

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

(Unaudited)

On September 14, 2007, we entered into a purchase agreement for the acquisition of nearly a 100% working interest in leaseholds located in three counties in eastern Kansas for a cash purchase price of $800,000.

On September 27, 2007, we entered into a purchase and sale agreement with shareholders to acquire oil leases in eastern Kansas for a purchase price of $2.7 million.

Note 6 — Commitments and Contingencies

On March 6, 2008, we entered into an agreement with Shell whereby we agreed to an 18-month fixed-price delivery contract with Shell for 130 BOPD at a fixed price per barrel of $96.90, less transportation costs. This contract is for the physical delivery of oil under our normal sales. This represented approximately 60% of our total oil production on a net revenue basis at that time and represents approximately $6.8 million in gross revenue before the deduction of transportation costs over the 18-month period. In addition, we agreed to sell all of our remaining oil production at current spot market pricing beginning April 1, 2008 through September 30, 2009 to Shell.

Note 7 — Subsequent Events

On July 2, 2008, we granted 122,000 options to purchase shares of our common stock to our non-employee directors as compensation for their service as directors in fiscal 2009. The options are exercisable until July 1, 2011 at a per share price of $6.25.

On July 3, 2008, we entered a new three-year $50 million senior secured credit facility with Texas Capital Bank, N. A. with an initial borrowing base of $10.75 million based on our current proved oil and natural gas reserves. We used our initial borrowing under this facility of $10.75 million to redeem an aggregate principal amount of $6.3 million of our 10% debentures, assign approximately $2.0 million of our existing indebtedness with another bank to this facility, repay $965,000 of seller-financed notes, pay the transaction costs, fees and expenses of this new facility and expand our current development projects, including the completion of 31 new oil wells that have been drilled since May of 2008.

As of July 3, 2008, we entered into an ISDA master agreement and a costless collar with BP Corporation North America Inc. for 130 barrels of oil per day with a price floor of $132.50 per barrel and a price ceiling of $155.70 per barrel for NYMEX West Texas Intermediate for the period of October 1, 2009 until March 31, 2011.

On July 7, 2008, we amended the $2.7 million of aggregate principal amount of our 10% debentures that remain outstanding to, among other things, permit the indebtedness under our new credit facility, subordinate the security interests of the debentures to the new credit facility, provide for the redemption of the remaining debentures with the net proceeds from our next debt or equity offering, eliminate the covenant to maintain certain production thresholds.

Effective July 25, 2008, we implemented a one-for-five reverse stock split of our issued and outstanding common stock. The number of authorized shares of common stock and preferred stock was not affected and remains at 100,000,000 and 10,000,000, respectively, but the number of shares of common stock outstanding was reduced from 22,214,166 to 4,443,467. The aggregate par value of the issued common stock was reduced by reclassifying a portion of the par value amount of the outstanding common shares from common stock to additional paid-in capital for all periods presented. In addition, all per share and share amounts, including stock options and warrants, have been retroactively restated in the accompanying consolidated financial statements and notes to consolidated financial statements for all periods presented to reflect the reverse stock split.

G-7

EnerJex Resources, Inc.

Notes to Consolidated Financial Statements — (Continued)

(Unaudited)

On August 1, 2008, we entered into an employment agreement with and granted C. Stephen Cochennet, our president and chief executive officer, an option to purchase 75,000 shares of our common stock at $6.25 per share. 30,000 of the options vested immediately and expire on July 31, 2011. The remaining 45,000 options vest based on the following schedule: 10,000 options shall vest on July 1, 2009; 15,000 options shall vest on July 1, 2010; and 20,000 options shall vest on July 1, 2011. The options will be exercisable for a three year term following the vesting date.

On August 1, 2008, we entered into an employment agreement with and granted Dierdre P. Jones, our chief financial officer, an option to purchase 40,000 shares of our common stock at $6.25 per share for a period of three years expiring on July 22, 2011.

On August 8, 2008, we entered into a five year lease for corporate office space beginning September 1, 2008.

G-8

BLACK OAKS PROJECT LOCATIONS
(At time of Acquisition)

BLACK OAKS PROJECT
(At Completion of Phase 1 Development)

5,000,000 Shares

Common Stock

PROSPECTUS

       , 2008

Until           , 2008, all dealers that effect transactions in these securities may be required to deliver a prospectus, regardless of whether they are participating in this offering. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13.   Other Expenses of Issuance and Distribution

The following table sets forth all costs and expenses, other than underwriting discounts and commissions, to be paid in connection with the sale of the common stock being registered hereunder, all of which will be paid by us. All of the amounts shown are estimates except for the Securities and Exchange Commission registration fee and the American Stock Exchange application fee.

SEC registration fee	$	1,355.85
American Stock Exchange listing application fee	$	50,000
Printing expenses	$	150,000
FINRA filing fee	$	3,300
Legal fees and expenses	$	500,000	(1)
Accounting fees and expenses	$	15,500
Transfer Agent fees		1,000
Miscellaneous		28,844.15
Total	$	750,000

(1)  Includes $250,000 of expenses for underwriter’s counsel that the company has agreed to pay.

Item 14.   Indemnification of Directors and Officers

None of our directors will have personal liability to us or any of our stockholders for monetary damages for breach of fiduciary duty as a director involving any act or omission of any such director since provisions have been made in our articles of incorporation limiting such liability. The foregoing provisions will not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to us or our stockholders, (ii) for acts or omissions not in good faith or, which involve intentional misconduct or a knowing violation of law, (iii) under applicable Sections of the Nevada Revised Statutes, (iv) the payment of dividends in violation of Section 78.300 of the Nevada Revised Statutes or, (v) for any transaction from which the director derived an improper personal benefit.

Our bylaws provide for indemnification of the directors, officers, and employees of EnerJex Resources, Inc. in most cases for any liability suffered by them or arising out of their activities as directors, officers, and employees of EnerJex Resources, Inc. if they were not engaged in willful misfeasance or malfeasance in the performance of his or her duties; provided that in the event of a settlement the indemnification will apply only when the board of directors approves such settlement and reimbursement as being for the best interests of the corporation. The Bylaws, therefore, limit the liability of directors to the maximum extent permitted by Nevada law (Section 78.751).

Our officers and directors are accountable to us as fiduciaries, which means they are required to exercise good faith and fairness in all dealings affecting us. In the event that a stockholder believes the officers and/or directors have violated their fiduciary duties to us, the stockholder may, subject to applicable rules of civil procedure, be able to bring a class action or derivative suit to enforce the stockholder’s rights, including rights under certain federal and state securities laws and regulations to recover damages from and require an accounting by management. Stockholders who have suffered losses in connection with the purchase or sale of their interest in EnerJex Resources, Inc. in connection with such sale or purchase, including the misapplication by any such officer or director of the proceeds from the sale of these securities, may be able to recover such losses from us.

II-1

Item 15.   Recent Sales of Unregistered Securities

The following is a summary of transactions by us from March 31, 2005 through the date of this registration statement involving sales of our securities that were not registered under the Securities Act. Each offer and sale was made in reliance on Section 4(2) of the Securities Act, Regulation D promulgated under Section 4(2) of the Securities Act, or Rule 701 promulgated under Section 3(b) of the Securities Act, as transactions by an issuer not involving any public offering or transactions pursuant to compensatory benefit plans and contracts relating to compensation as provided under Rule 701. The purchasers were “accredited investors,” officers, directors or employees of the registrant or known to the registrant and its management through pre-existing business relationships, friends and employees. All purchasers were provided access to all material information which they requested, and all information necessary to verify such information and was afforded access to management of the registrant in connection with their purchases. All holders of the unregistered securities acquired such securities for investment and not with a view toward distribution, acknowledging such intent to the registrant. All certificates or agreements representing such securities that were issued contained restrictive legends, prohibiting further transfer of the certificates or agreements representing such securities, without such securities either being first registered or otherwise exempt from registration under the Securities Act, in any further resale or disposition.

On July 25, 2006, we issued 31,565 shares of our restricted common stock to Paul Branagan (our former sole officer), pursuant to his conversion of $40,000 of liabilities owed to him by us. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

Effective August 15, 2006, we instituted a 1 for 253.45 reverse split of our outstanding shares of common stock pursuant to our merger with EnerJex Kansas completed on August 15, 2006.

On August 15, 2006, we agreed to issue 2,366,600 shares of our restricted common stock to the stockholders of EnerJex Kansas pursuant to the merger (shares were issued on September 7, 2006). We believe that the issuance and sale of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2) and Regulation D, Rule 506.

On August 16, 2006, we granted 60,000 stock options to Todd Bart in consideration of his services as Chief Financial Officer. 20,000 options were to vest each year on the date of the anniversary of the agreement. Pursuant to the June 14, 2007 Separation Agreement we entered into with Mr. Bart, we vested his 60,000 options and he had until September 13, 2007 to exercise the options. The options expired without exercise. We believe that the grant of the options was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On October 24, 2006, we issued 3,000 shares of our restricted common stock to William Stoeckinger for his assistance in the assessment of well data and geology. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On October 26, 2006, we issued 40,000 shares of our restricted common stock to Stoecklein Law Group for professional legal services provided to us. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On October 26, 2006, we issued 68,000 shares of our restricted common stock to Paul Branagan pursuant to his agreement to convert all of the liabilities owed to him by us into shares of our common stock. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On October 26, 2006, we issued 34,000 shares of our restricted common stock to 3GC Ltd. pursuant to its agreement to convert all of the liabilities owed to 3GC Ltd. by us into shares of our common stock. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

II-2

On December 12, 2006, we agreed to issue 64,000 shares of our restricted common stock to MorMeg, LLC pursuant to the Amendment No. 1 to the Letter Agreement dated December 12, 2006 (shares were issued on February 27, 2007). We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

Pursuant to the debentures and the Financing Agreements related thereto, on April 11, 2007, the lenders funded $6,300,000, and concurrent with First Closing, we issued 1,260,000 shares of restricted common stock to six accredited investors on April 13, 2007. Pursuant to the terms of the Securities Purchase Agreement, the lenders funded an additional $2,700,000 at the second closing on June 21, 2007 and we issued an additional 540,000 shares of restricted common stock on June 26, 2007.

Additionally, in the event EnerJex Kansas does not meet certain production thresholds, we must issue to the lenders up to an additional 1,800,000 shares of common stock or warrants to purchase shares of common stock.

Additionally, we issued a warrant to purchase 75,000 shares of our common stock to C. K. Cooper as a private placement fee on April 12, 2007 in connection with the placement of the debentures. The warrant has an exercise price of $3.00 per share and expires on April 11, 2010.

We believe that the issuance and sale of the securities (debentures, common stock and common stock purchase warrants) and the issuance of warrants to C. K. Cooper were exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2) and Regulation D Rule 506.

On May 4, 2007, the Governance, Compensation and Nominating Committee agreed to compensate the Audit Committee Chairman, Daran Dammeyer, $2,500 per month in cash and $1,000 per month in shares of our common stock. Additionally, it was agreed that Mr. Dammeyer will be issued the first twelve months of the stock compensation, 1,920 shares, immediately (the 1,920 shares were issued to Mr. Dammeyer on June 1, 2007).

In addition, on May 4, 2007, the Governance, Compensation and Nominating Committee agreed to grant the following options to the following persons:

							Option
Person Issued to	No. of options		Exercise Price		Term		Plan
C. Stephen Cochennet, Chief Executive Officer		200,000	$	6.25		4 Years		2000
Daran G. Dammeyer, Director		40,000	$	6.25		4 Years		2002/2003
Robert G. Wonish, Director		40,000	$	6.25		4 Years		2002/2003
Darrel G. Palmer, Director		40,000	$	6.25		4 Years		2002/2003
Mark Haas, Service provider		60,000	$	6.25		4 Years		2002/2003
Brad Kramer, Employee		15,000	$	6.25		4 Years		2002/2003
Maureen Elton, Employee		10,000	$	6.25		4 Years		2002/2003
Total:		405,000

We believe that the above disclosed issuance of shares and grant of options were exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On May 22, 2007, we issued 3,000 shares of our restricted common stock to P & R Oil Field Services for oil field services. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On August 1, 2007, we granted Dierdre P. Jones, then our director of finance and accounting, an option to purchase 20,000 shares of our restricted common stock at $7.50 per share for a period of four years expiring on July 31, 2011. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

II-3

On November 1, 2007, we granted Jay Schendel, Field Operations Supervisor of the Company, an option to purchase 10,000 shares of our restricted common stock at $6.25 per share for a period of four years expiring on October 31, 2011. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On January 16, 2008, we granted 23,500 options to purchase shares of our common stock to three employees. The options are exercisable until January 15, 2011 at a per share price of $6.25. Each option was fully vested upon grant. We believe that the option grants were exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On May 15, 2008, we issued 2,182 shares of our common stock to Daran Dammeyer as compensation for his services as Audit Committee Chairman for fiscal 2009. We believe that the issuance of the shares was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On July 2, 2008, we granted 122,000 options to purchase shares of our common stock to our non-employee directors as compensation for their service as directors in fiscal 2009. The options are exercisable until July 1, 2011 at a per share price of $6.25. We believe that the option grants were exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2).

On August 1, 2008, we granted C. Stephen Cochennet, our president and chief executive officer, an option to purchase 75,000 shares of the our common stock at $6.25 per share, 30,000 of which vested immediately and expire on July 31, 2011. The remaining 45,000 options vest based on the following schedule: 10,000 vest on July 1, 2009; 15,000 vest on July 1, 2010; and 20,000 vest on July 1, 2011. The options will be exercisable for a three year term following each respective vesting date. We believe that the grant of the options was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2) thereof.

On August 1, 2008, we granted Dierdre P. Jones, our chief financial officer, a vested option to purchase 40,000 shares of our common stock at $6.25 per share for a period of three years expiring on July 31, 2011. We believe that the grant of the option was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933 by virtue of Section 4(2) thereof.

Item 16.   Exhibits and Financial Statement Schedules

(a) Exhibits

Exhibit No.			Description
	1	.1	Form of Underwriting Agreement
	2	.1	Agreement and Plan of Merger between Millennium Plastics Corporation and Midwest Energy, Inc. effective August 15, 2006 (incorporated by reference to Exhibit 2.3 to the Form 8-K filed on August 16, 2006)
	3	.1	Amended and Restated Articles of Incorporation, as currently in effect (incorporated by reference to Exhibit 3.1 to Form 10-Q filed on August 14, 2008)
	3	.2	Amended and Restated Bylaws, as currently in effect (incorporated by reference to Exhibit 3.3 to the Form SB-2 filed on February 23, 2001)
	4	.1	Article VI of Amended and Restated Articles of Incorporation of Millennium Plastics Corporation (incorporated by reference to Exhibit 1.3 to the Form 8-K filed on December 6, 1999)
	4	.2	Article II and Article VIII, Sections 3 and 6 of Amended and Restated Bylaws of Millennium Plastics Corporation (incorporated by reference to Exhibit 4.1 to the Form SB-2 filed on February 23, 2001)
	4	.3	Specimen common stock certificate (incorporated by reference to Exhibit 4.3 to Amendment No. 1 to Form S-1 filed on May 27, 2008)
	5	.1	Opinion of Husch Blackwell Sanders LLP
	10	.1	Letter Agreement with MorMeg, LLC dated September 26, 2006 (incorporated by reference to Exhibit 10.9 to the Form 8-K filed on October 13, 2006)

II-4

Exhibit No.			Description
	10	.2	Amendment No. 1 to Letter Agreement with MorMeg, LLC dated December 12, 2006 (incorporated by reference to Exhibit 10.10 to the Form 8-K filed on January 8, 2007)
	10	.3	Debenture Securities Purchase Agreement dated April 11, 2007 (incorporated by reference to Exhibit 10.11 to the Form 8-K filed on April 16, 2007)
	10	.4	Debenture Registration Rights Agreement dated April 11, 2007 (incorporated by reference to Exhibit 10.12 to the Form 8-K filed on April 16, 2007)
	10	.5	Senior Secured Debenture — ($3,500,000) West Coast Opportunity Fund, LLC dated April 11, 2007 (incorporated by reference to Exhibit 10.13 to the Form 8-K filed on April 16, 2007)
	10	.6	Senior Secured Debenture — ($700,000) DKR Soundshore Oasis Holding Fund Ltd. dated April 11, 2007 (incorporated by reference to Exhibit 10.14 to the Form 8-K filed on April 16, 2007)
	10	.7	Senior Secured Debenture — ($1,050,000) Enable Growth Partners, LP dated April 11, 2007 (incorporated by reference to Exhibit 10.15 to the Form 8-K filed on April 16, 2007)
	10	.8	Senior Secured Debenture — ($350,000) Enable Opportunity Partners LP dated April 11, 2007 (incorporated by reference to Exhibit 10.16 to the Form 8-K filed on April 16, 2007)
	10	.9	Senior Secured Debenture — ($350,000) Glacier Partners LP dated April 11, 2007 (incorporated by reference to Exhibit 10.17 to the Form 8-K filed on April 16, 2007)
	10	.10	Senior Secured Debenture — ($350,000) Frey Living Trust dated April 11, 2007 (incorporated by reference to Exhibit 10.18 to the Form 8-K filed on April 16, 2007)
	10	.11	Debenture Secured Guaranty dated April 11, 2007 (incorporated by reference to Exhibit 10.19 to the Form 8-K filed on April 16, 2007)
	10	.12	Debenture Pledge and Security Agreement dated April 11, 2007 (incorporated by reference to Exhibit 10.20 to the Form 8-K filed on April 16, 2007)
	10	.13	Joint Exploration Agreement with MorMeg, LLC dated March 30, 2007 (incorporated by reference to Exhibit 10.21 to the Form 8-K filed on April 16, 2007)
	10	.14	Purchase and Sale Agreement with MorMeg, LLC dated April 18, 2007 (incorporated by reference to Exhibit 10.22 to the Form 8-K filed on May 2, 2007)
	10	.15†	2000/2001 Stock Option Plan (incorporated by reference to Exhibit 99.2 to the Form 10-QSB filed on February 14, 2001)
	10	.16†	EnerJex Resources, Inc. Stock Option Plan (incorporated by reference to Exhibit 10.23 to the Form 8-K filed on May 11, 2007)
	10	.17	Senior Secured Debenture dated June 21, 2007 — ($1,500,000)West Coast Opportunity Fund, LLC (incorporated by reference to Exhibit 10.24 to the Form 8-K filed on June 25, 2007)
	10	.18	Senior Secured Debenture — ($300,000) DKR Soundshore Oasis Holding Fund Ltd. dated June 21, 2007 (incorporated by reference to Exhibit 10.25 to the Form 8-K filed on June 25, 2007)
	10	.19	Senior Secured Debenture — ($450,000) Enable Growth Partners LP dated June 21, 2007 (incorporated by reference to Exhibit 10.26 to the Form 8-K filed on June 25, 2007)
	10	.20	Senior Secured Debenture — ($150,000) Enable Opportunity Partners LP dated June 21, 2007 (incorporated by reference to Exhibit 10.27 to the Form 8-K filed on June 25, 2007)
	10	.21	Senior Secured Debenture — ($150,000) Glacier Partners LP dated June 21, 2007 (incorporated by reference to Exhibit 10.28 to the Form 8-K filed on June 25, 2007)
	10	.22	Senior Secured Debenture — ($150,000) Frey Living Trust dated June 21, 2007 (incorporated by reference to Exhibit 10.29 to the Form 8-K filed on June 25, 2007)
	10	.23	Debenture Mortgage, Security Agreement and Assignment of Production dated June 21, 2007 (incorporated by reference to Exhibit 10.30 to the Form 8-K filed on June 25, 2007)
	10	.24	Separation Agreement with Todd Bart dated June 14, 2007 (incorporated by reference to Exhibit 10.31 to the Form 8-K filed on June 29, 2007)
	10	.25	Amended and Restated Well Development Agreement and Option for Gas City Project dated August 10, 2007 (incorporated by reference to Exhibit 10.31 to the Form 10-QSB filed on August 17, 2007)
	10	.26	Purchase and Sale Contract for Tri-County Project dated September 27, 2007 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on October 2, 2007)

II-5

Exhibit No.			Description
	10	.27	Purchase and Sale Contract DD Energy Project dated September 14, 2007 (incorporated by reference to Exhibit 10.33 to the Form 10-QSB filed on November 14, 2007)
	10	.28	Amendment No. 1 to Well Development Agreement and Option for Gas City Project dated December 10, 2007 (incorporated by reference to Exhibit 10.35 to the Form 8-K filed on December 20, 2007)
	10	.29	Debenture Holder Amendment Letter dated December 10, 2007 (incorporated by reference to Exhibit 10.36 to the Form 8-K filed on December 20, 2007)
	10	.30	Amendment No. 2 to Joint Exploration Agreement with MorMeg, LLC dated March 20, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on March 24, 2008)
	10	.31	Debenture Holder Consent and Waiver Agreement dated April 9, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on April 15, 2008)
	10	.32	Agreement with Shell Trading (US) Company dated March 6, 2008 (incorporated by reference to Exhibit 10.32 to Amendment No. 1 to Form S-1 filed on May 27, 2008)(1)
	10	.33	Credit Agreement with Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.33 to the Form 10-K filed on July 10, 2008)
	10	.34	Promissory Note to Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.34 to the Form 10-K filed on July 10, 2008)
	10	.35	Amended and Restated Mortgage, Security Agreement, Financing Statement and Assignment of Production and Revenues with Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.35 to the Form 10-K filed on July 10, 2008)
	10	.36	Security Agreement with Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.36 to the Form 10-K filed on July 10, 2008)
	10	.37	Letter Agreement with Debenture Holders dated July 3, 2008 (incorporated by reference to Exhibit 10.37 to the Form 10-K filed on July 10, 2008)
	10	.38†	Employment Agreement with C. Stephen Cochennet dated August 1, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on August 1, 2008)
	10	.39†	Employment Agreement with Dierdre P. Jones dated August 1, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on August 1, 2008)
	21	.1	List of Subsidiaries
	23	.1	Consent of Weaver & Martin, LLC
	23	.2	Consent of Husch Blackwell Sanders LLP (included in Exhibit 5.1)
	23	.3	Consent of McCune Engineering, P.E. (previously filed)

†	Indicates management contract or compensatory plan or arrangement.
(1)	Portions of this exhibit are omitted and were filed separately with the Secretary of the SEC pursuant to EnerJex’s application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

(b) Financial Statement Schedules

All schedules have been omitted because the information required to be presented in them is not applicable or is shown in the financial statements or related notes.

Item 17.   Undertakings.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the Act”) may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the small business issuer has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the small business issuer of expenses incurred or paid by a director, officer or controlling person of the small business issuer in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the small business issuer will, unless

II-6

in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act.

The undersigned registrant hereby undertakes that:

1. For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

2. For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-7

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Amendment to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Overland Park, State of Kansas, on the 3rd day of September, 2008.

ENERJEX RESOURCES, INC.

By:  /s/  C. Stephen Cochennet

C. Stephen Cochennet

President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this Amendment to the Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/  C. Stephen Cochennet C. Stephen Cochennet	President, Chief Executive Officer, (Principal Executive Officer) and Chairman	September 3, 2008
/s/  Dierdre P. Jones Dierdre P. Jones	Chief Financial Officer (Principal Financial and Accounting Officer)	September 3, 2008
/s/  Robert G. Wonish Robert G. Wonish	Director	September 3, 2008
/s/  Daran G. Dammeyer Daran G. Dammeyer	Director	September 3, 2008
/s/  Darrel G. Palmer Darrel G. Palmer	Director	September 3, 2008
/s/  James W. Rector Dr. James W. Rector	Director	September 3, 2008

II-8

EXHIBIT INDEX

Exhibit No.			Description
	1	.1	Form of Underwriting Agreement
	2	.1	Agreement and Plan of Merger between Millennium Plastics Corporation and Midwest Energy, Inc. effective August 15, 2006 (incorporated by reference to Exhibit 2.3 to the Form 8-K filed on August 16, 2006)
	3	.1	Amended and Restated Articles of Incorporation, as currently in effect (incorporated by reference to Exhibit 3.1 to Form 10-Q filed on August 14, 2008)
	3	.2	Amended and Restated Bylaws, as currently in effect (incorporated by reference to Exhibit 3.3 to the Form SB-2 filed on February 23, 2001)
	4	.1	Article VI of Amended and Restated Articles of Incorporation of Millennium Plastics Corporation (incorporated by reference to Exhibit 1.3 to the Form 8-K filed on December 6, 1999)
	4	.2	Article II and Article VIII, Sections 3 and 6 of Amended and Restated Bylaws of Millennium Plastics Corporation (incorporated by reference to Exhibit 4.1 to the Form SB-2 filed on February 23, 2001)
	4	.3	Specimen common stock certificate (incorporated by reference to Exhibit 4.3 to Amendment No. 1 to Form S-1 filed on May 27, 2008)
	5	.1	Opinion of Husch Blackwell Sanders LLP
	10	.1	Letter Agreement with MorMeg, LLC dated September 26, 2006 (incorporated by reference to Exhibit 10.9 to the Form 8-K filed on October 13, 2006)
	10	.2	Amendment No. 1 to Letter Agreement with MorMeg, LLC dated December 12, 2006 (incorporated by reference to Exhibit 10.10 to the Form 8-K filed on January 8, 2007)
	10	.3	Debenture Securities Purchase Agreement dated April 11, 2007 (incorporated by reference to Exhibit 10.11 to the Form 8-K filed on April 16, 2007)
	10	.4	Debenture Registration Rights Agreement dated April 11, 2007 (incorporated by reference to Exhibit 10.12 to the Form 8-K filed on April 16, 2007)
	10	.5	Senior Secured Debenture — ($3,500,000) West Coast Opportunity Fund, LLC dated April 11, 2007 (incorporated by reference to Exhibit 10.13 to the Form 8-K filed on April 16, 2007)
	10	.6	Senior Secured Debenture — ($700,000) DKR Soundshore Oasis Holding Fund Ltd. dated April 11, 2007 (incorporated by reference to Exhibit 10.14 to the Form 8-K filed on April 16, 2007)
	10	.7	Senior Secured Debenture — ($1,050,000) Enable Growth Partners, LP dated April 11, 2007 (incorporated by reference to Exhibit 10.15 to the Form 8-K filed on April 16, 2007)
	10	.8	Senior Secured Debenture — ($350,000) Enable Opportunity Partners LP dated April 11, 2007 (incorporated by reference to Exhibit 10.16 to the Form 8-K filed on April 16, 2007)
	10	.9	Senior Secured Debenture — ($350,000) Glacier Partners LP dated April 11, 2007 (incorporated by reference to Exhibit 10.17 to the Form 8-K filed on April 16, 2007)
	10	.10	Senior Secured Debenture — ($350,000) Frey Living Trust dated April 11, 2007 (incorporated by reference to Exhibit 10.18 to the Form 8-K filed on April 16, 2007)
	10	.11	Debenture Secured Guaranty dated April 11, 2007 (incorporated by reference to Exhibit 10.19 to the Form 8-K filed on April 16, 2007)
	10	.12	Debenture Pledge and Security Agreement dated April 11, 2007 (incorporated by reference to Exhibit 10.20 to the Form 8-K filed on April 16, 2007)
	10	.13	Joint Exploration Agreement with MorMeg, LLC dated March 30, 2007 (incorporated by reference to Exhibit 10.21 to the Form 8-K filed on April 16, 2007)
	10	.14	Purchase and Sale Agreement with MorMeg, LLC dated April 18, 2007 (incorporated by reference to Exhibit 10.22 to the Form 8-K filed on May 2, 2007)
	10	.15†	2000/2001 Stock Option Plan (incorporated by reference to Exhibit 99.2 to the Form 10-QSB filed on February 14, 2001)

Exhibit No.			Description
	10	.16†	EnerJex Resources, Inc. Stock Option Plan (incorporated by reference to Exhibit 10.23 to the Form 8-K filed on May 11, 2007)
	10	.17	Senior Secured Debenture dated June 21, 2007 — ($1,500,000)West Coast Opportunity Fund, LLC (incorporated by reference to Exhibit 10.24 to the Form 8-K filed on June 25, 2007)
	10	.18	Senior Secured Debenture — ($300,000) DKR Soundshore Oasis Holding Fund Ltd. dated June 21, 2007 (incorporated by reference to Exhibit 10.25 to the Form 8-K filed on June 25, 2007)
	10	.19	Senior Secured Debenture — ($450,000) Enable Growth Partners LP dated June 21, 2007 (incorporated by reference to Exhibit 10.26 to the Form 8-K filed on June 25, 2007)
	10	.20	Senior Secured Debenture — ($150,000) Enable Opportunity Partners LP dated June 21, 2007 (incorporated by reference to Exhibit 10.27 to the Form 8-K filed on June 25, 2007)
	10	.21	Senior Secured Debenture — ($150,000) Glacier Partners LP dated June 21, 2007 (incorporated by reference to Exhibit 10.28 to the Form 8-K filed on June 25, 2007)
	10	.22	Senior Secured Debenture — ($150,000) Frey Living Trust dated June 21, 2007 (incorporated by reference to Exhibit 10.29 to the Form 8-K filed on June 25, 2007)
	10	.23	Debenture Mortgage, Security Agreement and Assignment of Production dated June 21, 2007 (incorporated by reference to Exhibit 10.30 to the Form 8-K filed on June 25, 2007)
	10	.24	Separation Agreement with Todd Bart dated June 14, 2007 (incorporated by reference to Exhibit 10.31 to the Form 8-K filed on June 29, 2007)
	10	.25	Amended and Restated Well Development Agreement and Option for Gas City Project dated August 10, 2007 (incorporated by reference to Exhibit 10.31 to the Form 10-QSB filed on August 17, 2007)
	10	.26	Purchase and Sale Contract for Tri-County Project dated September 27, 2007 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on October 2, 2007)
	10	.27	Purchase and Sale Contract DD Energy Project dated September 14, 2007 (incorporated by reference to Exhibit 10.33 to the Form 10-QSB filed on November 14, 2007)
	10	.28	Amendment No. 1 to Well Development Agreement and Option for Gas City Project dated December 10, 2007 (incorporated by reference to Exhibit 10.35 to the Form 8-K filed on December 20, 2007)
	10	.29	Debenture Holder Amendment Letter dated December 10, 2007 (incorporated by reference to Exhibit 10.36 to the Form 8-K filed on December 20, 2007)
	10	.30	Amendment No. 2 to Joint Exploration Agreement with MorMeg, LLC dated March 20, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on March 24, 2008)
	10	.31	Debenture Holder Consent and Waiver Agreement dated April 9, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on April 15, 2008)
	10	.32	Agreement with Shell Trading (US) Company dated March 6, 2008 (incorporated by reference to Exhibit 10.32 to Amendment No. 1 to Form S-1 filed on May 27, 2008) (1)
	10	.33	Credit Agreement with Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.33 to the Form 10-K filed on July 10, 2008)
	10	.34	Promissory Note to Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.34 to the Form 10-K filed on July 10, 2008)
	10	.35	Amended and Restated Mortgage, Security Agreement, Financing Statement and Assignment of Production and Revenues with Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.35 to the Form 10-K filed on July 10, 2008)
	10	.36	Security Agreement with Texas Capital Bank, N.A. dated July 3, 2008 (incorporated by reference to Exhibit 10.36 to the Form 10-K filed on July 10, 2008)
	10	.37	Letter Agreement with Debenture Holders dated July 3, 2008 (incorporated by reference to Exhibit 10.37 to the Form 10-K filed on July 10, 2008)
	10	.38†	Employment Agreement with C. Stephen Cochennet dated August 1, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on August 1, 2008)

Exhibit No.			Description
	10	.39†	Employment Agreement with Dierdre P. Jones dated August 1, 2008 (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on August 1, 2008)
	21	.1	List of Subsidiaries
	23	.1	Consent of Weaver & Martin, LLC
	23	.2	Consent of Husch Blackwell Sanders LLP (included in Exhibit 5.1)
	23	.3	Consent of McCune Engineering, P.E. (previously filed)

†	Indicates management contract or compensatory plan or arrangement.
(1)	Portions of this exhibit are omitted and were filed separately with the Secretary of the SEC pursuant to EnerJex’s application requesting confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.

EX-1.1

Exhibit 1.1

[                    ] Shares

EnerJex Resources, Inc.

Common Stock

UNDERWRITING AGREEMENT

[                     __, 2008]

C. K. COOPER & COMPANY, INC.,
As Representative of the several
Underwriters named in Schedule 1 attached hereto,
c/o C. K. Cooper & Company, Inc.
18300 Von Karman Avenue, Suite 700
Irvine, California 92612

Ladies and Gentlemen:

     EnerJex Resources, Inc., a Nevada corporation (the “Company”), proposes to sell [                    ] shares (the “Firm Stock”) of the Company’s common stock, par value $0.001 per share (the “Common Stock”). In addition, the Company proposes to grant to the underwriters (the “Underwriters”) named in Schedule 1 attached to this agreement (this “Agreement”) an option to purchase up to [                    ] additional shares of the Common Stock on the terms set forth in Section 2 of this Agreement (the “Option Stock”). The Firm Stock and the Option Stock, if purchased, are hereinafter collectively called the “Stock.” This is to confirm the agreement concerning the purchase of the Stock from the Company by the Underwriters.

     1. Representations, Warranties and Agreements of the Company. The Company represents, warrants and agrees that:

          (a) A registration statement on Form S-1 relating to the Stock has (i) been prepared by the Company in conformity with the requirements of the Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations (the “Rules and Regulations”) of the Securities and Exchange Commission (the “Commission”) thereunder; (ii) been filed with the Commission under the Securities Act; and (iii) become effective under the Securities Act. Copies of such registration statement and any amendment thereto have been delivered by the Company to you as the representative (the “Representative”) of the Underwriters. As used in this Agreement:

               (i) “Applicable Time” means [___:00] p.m. (New York City time) [                    ], 2008;

               (ii) “Effective Date” means the date and time as of which such registration statement was declared effective by the Commission;

               (iii) “Issuer Free Writing Prospectus” means each “free writing prospectus” (as defined in Rule 405 of the Rules and Regulations) prepared by or on behalf of the Company or used or referred to by the Company in connection with the offering of the Stock;

               (iv) “Preliminary Prospectus” means any preliminary prospectus relating to the Stock included in such registration statement or filed with the Commission pursuant to Rule 424(b) of the Rules and Regulations;

               (v) “Pricing Disclosure Package” means, as of the Applicable Time, the most recent Preliminary Prospectus, together with the information included in Schedule 3 attached hereto and each Issuer Free Writing Prospectus filed or used by the Company on or before the Applicable Time, other than a road show that is an Issuer Free Writing Prospectus but is not required to be filed under Rule 433 of the Rules and Regulations.

               (vi) “Prospectus” means the final prospectus relating to the Stock, as filed with the Commission pursuant to Rule 424(b) of the Rules and Regulations; and

               (vii) “Registration Statement” means such registration statement, as amended as of the Effective Date, including any Preliminary Prospectus or the Prospectus and all exhibits to such registration statement.

          Any reference to the “most recent Preliminary Prospectus” shall be deemed to refer to the latest Preliminary Prospectus included in the Registration Statement or filed pursuant to Rule 424(b) prior to or on the date hereof. Any reference herein to the term “Registration Statement” shall be deemed to include the abbreviated registration statement to register additional shares of Common Stock under Rule 462(b) of the Rules and Regulations (the “Rule 462(b) Registration Statement”). The Commission has not issued any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus or suspending the effectiveness of the Registration Statement, and no proceeding or examination for such purpose has been instituted or to the knowledge of the Company, threatened by the Commission.

          (b) Notwithstanding anything contained herein to the contrary, including, without limitation any reference herein to an “Issuer Free Writing Prospectus”, for so long as and at any time that the Company is an “ineligible issuer” (as defined in Rule 405), the Company shall not use nor file any Issuer Free Writing Prospectus.

          (c) The Registration Statement conformed and will conform in all material respects on the Effective Date and on the applicable Delivery Date, and any amendment to the Registration Statement filed after the date hereof will conform in all material respects when filed, to the requirements of the Securities Act and the Rules and Regulations. The most recent Preliminary Prospectus conformed, and the Prospectus will conform, in all material respects when filed with the Commission pursuant to Rule 424(b) and on the applicable Delivery Date to the requirements of the Securities Act and the Rules and Regulations.

          (d) The Registration Statement did not, as of the Effective Date, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Registration Statement in reliance upon and in conformity with written information furnished to the Company through the Representative by

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or on behalf of any Underwriter specifically for inclusion therein, which information is specified in Section 8(e) of this Agreement.

          (e) The Prospectus will not, as of its date and on the applicable Delivery Date, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Prospectus in reliance upon and in conformity with written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein, which information is specified in Section 8(e) of this Agreement.

          (f) The Pricing Disclosure Package did not, as of the Applicable Time, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein in the case of the Preliminary Prospectus or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Pricing Disclosure Package in reliance upon and in conformity with written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein, which information is specified in Section 8(e) of this Agreement.

          (g) Each Issuer Free Writing Prospectus (including, without limitation, any road show that is a free writing prospectus under Rule 433), when considered together with the Pricing Disclosure Package as of the Applicable Time, did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

          (h) Each Issuer Free Writing Prospectus conformed or will conform in all material respects to the requirements of the Securities Act and the Rules and Regulations on the date of first use, and the Company has complied in all material respects with all prospectus delivery and any filing requirements applicable to such Issuer Free Writing Prospectus pursuant to the Rules and Regulations. The Company has not made any offer relating to the Stock that would constitute an Issuer Free Writing Prospectus without the prior written consent of the Representative. The Company has retained in accordance with the Rules and Regulations all Issuer Free Writing Prospectuses that were not required to be filed pursuant to the Rules and Regulations. The Company has taken all actions necessary so that any “road show” (as defined in Rule 433 of the Rules and Regulations) in connection with the offering of the Stock will not be required to be filed pursuant to the Rules and Regulations.

          (i) The Company has been duly incorporated, is validly existing and in good standing as a corporation under the laws of the State of Nevada and is duly qualified to do business and in good standing as a foreign corporation in each jurisdiction in which its ownership or lease of property or the conduct of its businesses requires such qualification, except where the failure to be so qualified or in good standing would not, in the aggregate, reasonably be expected to have a material adverse effect on the condition (financial or otherwise), results of operations, stockholders’ equity, properties, business or prospects of the Company (a “Material Adverse Effect”); the Company has all corporate power and authority necessary to own or hold its properties and to conduct the businesses in which it is engaged. Except as described in the Registration Statement and except for

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EnerJex Development, LLC, the Company does not own or control, directly or indirectly, any corporation, association or other entity.

          (j) The Company has an authorized capitalization as set forth in each of the most recent Preliminary Prospectus and the Prospectus, and all of the issued shares of capital stock of the Company have been duly authorized and validly issued, are fully paid and non-assessable, conform to the description thereof contained in the most recent Preliminary Prospectus and were issued in compliance with federal and state securities laws (except where the failure to comply would not result in the loss of any exemption to such securities laws relied on by the Company in connection with such issuances) and not in violation of any preemptive right, resale right, right of first refusal or similar right. Upon the issuance and sale of the shares of Firm Stock, and giving effect to the 1-for-5 reverse stock split of the Common Stock contemplated in the Preliminary Prospectus (assuming no fractional shares will remain outstanding thereafter), as of June 30, 2008, the Company would have the authorized and outstanding capital as set forth in each of the most recent Preliminary Prospectus and the Prospectus under the column of the Capitalization table labeled “Pro Forma As Adjusted.” All of the Company’s options, warrants and other rights to purchase or exchange any securities for shares of the Company’s capital stock have been duly authorized and validly issued, conform to the description thereof contained in the most recent Preliminary Prospectus and were issued in compliance with federal and state securities laws (except where the failure to comply would not result in the loss of any exemption to such securities laws relied on by the Company in connection with such issuances). Except as disclosed in the Prospectus and except for the transactions contemplated by this Agreement, the Company does not have outstanding any options to purchase, or any preemptive rights or other rights to subscribe for or to purchase any securities or obligations convertible into, or any contracts or commitments to issue or sell, shares of its capital stock or any such options, rights, convertible securities or obligations. The description of the Company’s stock option and stock purchase plans and the options or other rights granted and exercised thereunder included in the Prospectus accurately and fairly presents in all material respects the information required by the Securities Act to be shown with respect to such plans, options and rights.

          (k) The shares of the Stock to be issued and sold by the Company to the Underwriters hereunder have been duly authorized and, upon payment and delivery in accordance with this Agreement, will be validly issued, fully paid and non-assessable, will conform to the description thereof contained in the most recent Preliminary Prospectus, will be issued in compliance with federal and state securities laws (except where the failure to comply would not result in the loss of any exemption to such securities laws relied on by the Company in connection with such issuances) and will be free of statutory and contractual preemptive rights, rights of first refusal and similar rights.

          (l) The warrants to purchase Common Stock to be issued to the Underwriters (the “Underwriter Warrants”) pursuant to Section 5(a)(xii) have been duly authorized for issuance. The Company has reserved a sufficient number of shares of its Common Stock for issuance upon exercise of the Underwriter Warrants and when issued and paid for in accordance with the terms of the Underwriter Warrants, such Common Stock will be validly issued, fully paid and non-assessable. The issuance of the Common Stock pursuant to the Underwriter Warrants will not be subject to any preemptive rights, rights of first refusal or other similar rights to subscribe for or purchase securities of the Company.

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          (m) The Company has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement. This Agreement has been duly and validly authorized, executed and delivered by the Company.

          (n) The execution, delivery and performance of this Agreement by the Company, the consummation of the transactions contemplated hereby and the application of the proceeds from the sale of the Stock as described under “Use of Proceeds” in the most recent Preliminary Prospectus will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, impose any lien, charge or encumbrance upon any property or assets of the Company, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement, license or other agreement or instrument to which the Company is a party or by which the Company is bound or to which any of the property or assets of the Company is subject (except to the extent such default has been waived in writing or otherwise cured); (ii) result in any violation of the provisions of the charter or by-laws (or similar organizational documents) of the Company; or (iii) result in any violation of any statute or any order, rule or regulation of any court or federal, state, local or foreign governmental agency or body having jurisdiction over the Company or any of its properties or assets (each, a “Governmental Authority”) except for such conflicts, breaches or violations in the case of clauses (i) and (iii) that would not individually or in the aggregate reasonably be expected to have a Material Adverse Effect.

          (o) No consent, approval, authorization or order of, or filing or registration with, any court or governmental agency or body having jurisdiction over the Company or any of its properties or assets is required for the execution, delivery and performance of this Agreement by the Company, the consummation of the transactions contemplated hereby, the application of the proceeds from the sale of the Stock as described under “Use of Proceeds” in the most recent Preliminary Prospectus, except for the registration of the Stock under the Securities Act and such consents, approvals, authorizations, registrations or qualifications as may be required under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and applicable state securities or Blue Sky laws or foreign securities laws in connection with the purchase and sale of the Stock by the Underwriters and the issuance of the Underwriter Warrants.

          (p) Except as described in the most recent Preliminary Prospectus, there are no contracts, agreements or understandings between the Company and any person granting such person the right (other than rights which have been waived in writing or otherwise satisfied) to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company owned or to be owned by such person or to require the Company to include such securities in the securities registered pursuant to the Registration Statement or with any securities of the Company being registered pursuant to any other registration statement filed by the Company under the Securities Act.

          (q) The Company has not sold or issued any securities that would be integrated with the offering of the Stock contemplated by this Agreement pursuant to the Securities Act, the Rules and Regulations or the interpretations thereof by the Commission.

          (r) Since April 1, 2007, the Company has filed all reports required to be filed by it under the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, (the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension, except where the failure to do so would not reasonably be expected to have a Material Adverse Effect. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Exchange Act and the

5

rules and regulations of the SEC promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, except where the failure to do so would not reasonably be expected to have a Material Adverse Effect. The Common Stock has been registered pursuant to Section 12(g) of the Exchange Act.

          (s) The Company has not sustained, since the date of the latest periodic report filed under Section 13 or 15(d) of the Exchange Act which contain the same financial statements which are also contained in the most recent Preliminary Prospectus, any (i) loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree other than as set forth or contemplated in the Preliminary Prospectus, and (ii) since such date, there has not been any change in the capital stock, long-term debt, net current assets or short-term debt of the Company or any adverse change, or any development involving a prospective adverse change, in or affecting the condition (financial or otherwise), results of operations, stockholders’ equity, properties, management, business or prospects of the Company other than as set forth or contemplated in the Preliminary Prospectus, the effect of which in any such case described in clause (i) or (ii), would not, in the aggregate, reasonably be expected to have a Material Adverse Effect, or except in the case of clause (ii), as it relates to refinancing of outstanding indebtedness or additional capital for development projects, the terms of which have been previously provided to the Underwriters, or as it relates to capital stock, such matters permitted under Section 5(a)(x) of this Agreement.

          (t) Since the date as of which information is given in the most recent Preliminary Prospectus, the Company has not (i) incurred any liability or obligation, direct or contingent, other than liabilities and obligations that were incurred in the ordinary course of business, (ii) entered into any material transaction not in the ordinary course of business, or (iii) declared or paid any dividend on its capital stock.

          (u) The historical financial statements (including the related notes and supporting schedules) included in the most recent Preliminary Prospectus comply as to form in all material respects with the requirements of Regulation S-X under the Securities Act (“Regulation S-X”) and present fairly, in all material respects, the financial condition, results of operations and cash flows of the entities purported to be shown thereby at the dates and for the periods indicated and have been prepared in conformity with accounting principles generally accepted in the United States applied on a consistent basis throughout the periods involved.

          (v) [Reserved]

          (w) Weaver & Martin, LLC, who have audited certain financial statements of the Company, whose report appears in the most recent Preliminary Prospectus and who have delivered the initial letter referred to in Section 7(f) of this Agreement, is an independent registered public accounting firm as required by the Securities Act and the Rules and Regulations and have been appointed by the Company’s audit committee and such audit committee is comprised entirely of members of the board of directors of the Company each of whom qualify as an independent director as defined by Section 121B(2)(c) of the American Stock Exchange Company and Section 10A(m) of the Exchange Act and Rule 10A-3 thereunder.

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          (x) There are no contracts or other documents required to be described in the Registration Statement or to be filed as exhibits to the Registration Statement by the Securities Act or by the Rules and Regulations which have not been described in or filed as exhibits to, the Registration Statement, as required. The contracts so described in the Prospectus to which the Company is a party have been duly authorized, executed and delivered by the Company, constitute valid and binding agreements of the Company and are enforceable against the Company in accordance with their respective terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or similar laws in effect which affect creditors’ rights generally, or (ii) laws relating to the availability of specific performance, injunctive relief or other equitable remedies, and, to the Company’s knowledge, such contracts are enforceable in accordance with their respective terms by the Company against the other parties thereto, except as such enforceability may be limited by (x) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or similar laws in effect which affect creditors’ rights generally, or (y) laws relating to the availability of specific performance, injunctive relief or other equitable remedies, and such contracts are in full force and effect on the date hereof. Neither the Company, nor, to the best of the Company’s knowledge, any other party thereto, is in breach of or default under any of such contracts, except for such breaches or defaults that will not result in a Material Adverse Effect.

          (y) The Company carries, or is covered by, insurance from insurers of recognized financial responsibility in such amounts and covering such risks as is adequate for the conduct of its businesses and the value of its properties and as is customary for companies engaged in similar businesses in similar industries in which the Company operates. All policies of insurance of the Company are in full force and effect; the Company is in compliance with the terms of such policies in all material respects; and the Company has not received notice from any insurer or agent of such insurer that capital improvements or other expenditures are required or necessary to be made in order to continue such insurance; there are no claims by the Company under any such policy or instrument as to which any insurance company is denying liability or defending under a reservation of rights clause; and the Company does not have any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not reasonably be expected to have a Material Adverse Effect.

          (z) The statistical and market-related data and the financial statements of the Company included in the most recent Preliminary Prospectus, the Pricing Disclosure Package and the Prospectus are based on or derived from sources that the Company believes to be reliable and accurate in all material respects.

          (aa) The Company is not, and as of the applicable Delivery Date and, after giving effect to the offer and sale of the Stock and the application of the proceeds therefrom as described under “Use of Proceeds” in the most recent Preliminary Prospectus and the Prospectus, nor will it be, (i) an “investment company” within the meaning of such term under the Investment Company Act of 1940, as amended (the “Investment Company Act”), and the rules and regulations of the Commission thereunder or (ii) a “business development company” (as defined in Section 2(a)(48) of the Investment Company Act).

          (bb) There are no legal or governmental proceedings pending to which the Company is a party or of which any property or assets of the Company is the subject, before or by any court or Governmental Authority, or any arbitrator which if determined adversely to the

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Company that would, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or would, individually or in the aggregate, reasonably be expected to have a material adverse effect on the performance of this Agreement or the consummation of the transactions contemplated hereby; and to the Company’s knowledge, no such proceedings are threatened or contemplated by Governmental Authorities or others.

          (cc) There are no legal, governmental or regulatory actions, suits or proceedings or contracts or other documents of a character required to be described in the Registration Statement or the most recent Preliminary Prospectus or, in the case of documents, to be filed as exhibits to the Registration Statement that are not described and filed as required. The Company has no knowledge that (i) any other party to any such contract, agreement or arrangement has any intention not to render full performance as contemplated by the terms thereof; and (ii) that statements made in the most recent Preliminary Prospectus under the captions “Risk Factors,” “Business and Properties,” “Management,” “Director Compensation,” “Executive Compensation,” “Certain Relationships and Related Party Transactions,” “Principal Stockholders,” “Description of Capital Stock,” “Material United States Federal Income Tax Considerations for Non-U.S. Holders,” “Underwriting,” and “Legal Matters” insofar as they purport to constitute summaries of the terms of statutes, rules or regulations, legal or governmental proceedings or contracts and other documents, do not constitute accurate summaries of the terms of such statutes, rules and regulations, legal and governmental proceedings and contracts and other documents in all material respects.

          (dd) No relationship, direct or, to the knowledge of the Company, indirect, exists between or among the Company, on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company, on the other hand, that is required to be described in the most recent Preliminary Prospectus which is not so described. The Company has not, directly or indirectly, extended or maintained credit, or arranged for the extension of credit, or renewed an extension of credit, in the form of a personal loan to or for any of its directors or executive officers in violation of applicable laws, including Section 402 of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith (“Sarbanes-Oxley”).

          (ee) No labor disturbance by the employees of the Company exists or, to the knowledge of the Company, is imminent that would reasonably be expected to have a Material Adverse Effect.

          (ff) (i) Each “employee benefit plan” (within the meaning of Section 3(3) of the Employee Retirement Security Act of 1974, as amended (“ERISA”)) maintained by the Company or any member of its “Controlled Group” (defined as any organization which is a member of a controlled group of corporations within the meaning of Section 414 of the Internal Revenue Code of 1986, as amended (the “Code”)) (each a “Plan”) has been maintained in material compliance with its terms and with the requirements of all applicable statutes, rules and regulations including ERISA and the Code; and (ii) with respect to each Plan subject to Title IV of ERISA (a) no “reportable event” (within the meaning of Section 4043(c) of ERISA) has occurred or is reasonably expected to occur, (b) no “accumulated funding deficiency” (within the meaning of Section 302 of ERISA or Section 412 of the Code), whether or not waived, has occurred or is reasonably expected to occur, (c) the fair market value of the assets under each Plan exceeds the present value of all benefits accrued under such Plan (determined based on those assumptions used to fund such Plan) and (d) neither the Company nor any member of its Controlled Group has incurred, or reasonably expects to incur, any liability under Title IV of ERISA (other than contributions to the Plan or premiums to

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the PBGC in the ordinary course and without default) in respect of a Plan (including a “multiemployer plan”, within the meaning of Section 4001(c)(3) of ERISA).

          (gg) The Company has filed all material federal, state, local income and franchise tax returns required to be filed through the date hereof, subject to permitted extensions, and has paid all taxes due thereon, and no tax deficiency has been determined adversely to the Company. The Company has no knowledge of any tax deficiencies that could, in the aggregate, reasonably be expected to have a Material Adverse Effect. There is no pending dispute with any taxing authority relating to any of such returns and the Company has no knowledge of any proposed liability for any tax to be imposed upon the properties or assets of the Company for which there is not an adequate reserve reflected in the Company’s financial statements included in the most recent Preliminary Prospectus, the Pricing Disclosure Package and the Prospectus.

          (hh) There are no transfer taxes or other similar fees or charges under Federal law or the laws of any state, or any political subdivision thereof, required to be paid in connection with the execution and delivery of this Agreement or the issuance by the Company or sale by the Company of the Stock.

          (ii) The Company (i) is not in violation of its charter or by laws (or similar organizational documents), (ii) is not in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, license or other agreement or instrument to which it is a party or by which it is bound or to which any of its properties or assets is subject, (iii) is not in violation of any statute or any order, rule, regulation judgment or decree of any court or any arbitrator or Governmental Authority, or (iv) has not failed to obtain any license, permit, certificate, franchise or other governmental authorization or permit necessary to the ownership of its property or to the conduct of its business, except in the case of clauses (ii), (iii) and (iv) to the extent any such conflict, breach, violation, failure or default would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

          (jj) The Company (i) makes and keeps accurate books and records and (ii) maintains effective internal control over financial reporting as defined in Rules 13a-15 and 15d-15 under the Exchange Act and a system of internal accounting controls sufficient to provide reasonable assurance that (A) transactions are executed in accordance with management’s general or specific authorization, (B) transactions are recorded as necessary to permit preparation of the Company’s financial statements in conformity with accounting principles generally accepted in the United States and to maintain accountability for its assets, (C) access to the Company’s assets is permitted only in accordance with management’s general or specific authorization and (D) the recorded accountability for the Company’s assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company’s internal control over financial reporting is effective and the Company is not aware of any material weaknesses in its internal control over financial reporting, and since June 30, 2008, there has been no change in the Company’s internal control over financial reporting (whether or not remediated) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

          (kk) (i) The Company has established and maintains disclosure controls and procedures (as such term is defined in Rules 13a-15 and 15d-15 under the Exchange Act), (ii) such disclosure controls and procedures are designed to ensure that the information required to be

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disclosed by the Company in the reports it will file or submit under the Exchange Act is accumulated and communicated to management of the Company, including its principal executive officers and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure to be made and (iii) such disclosure controls and procedures are effective in all material respects to perform the functions for which they were established.

          (ll) The Company’s board of directors has validly appointed an audit committee whose composition satisfies the applicable requirements of Section 121(A) and Section 803(a) of the AMEX Company Guide and the Company’s board of directors and/or the audit committee has adopted a charter that satisfies the requirements of Section 121(B) of the AMEX Company Guide. Since the date of the most recent balance sheet of the Company reviewed or audited by Weaver & Martin, LLC and the audit committee of the board of directors of the Company, (i) the Company has not been advised of (A) any significant deficiencies in the design or operation of internal controls that could adversely affect the ability of the Company to record, process, summarize and report financial data, or any material weaknesses in internal controls and (B) any fraud, whether or not material, that involves management or other employees who have a significant role in the internal controls of the Company, and (ii) since that date, there have been no significant changes in internal controls or in other factors that could significantly affect internal controls, including any corrective actions with regard to significant deficiencies and material weaknesses.

          (mm) All the Company’s directors or officers, in their capacities as such, are in compliance with the applicable provisions of Sarbanes-Oxley except for such provision, the failure with which to be in such compliance, would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

          (nn) The section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies” in the most recent Preliminary Prospectus accurately and fully describes (A) the accounting policies that the Company believes are the most important in the portrayal of the Company’s financial condition and results of operations and that require management’s most difficult, subjective or complex judgments (“Critical Accounting Policies”); (B) the judgments and uncertainties affecting the application of critical accounting policies; and (C) the likelihood that materially different amounts would be reported under different conditions or using different assumptions and an explanation thereof.

          (oo) The Company currently possesses all material permits, licenses, patents, franchises, certificates and other authorizations (“Permits”) issued by, and has made all declarations and filings with, the appropriate Governmental Authorities that are necessary for the ownership or lease of its properties or the conduct of its businesses in the manner described in the most recent Preliminary Prospectus, the Pricing Disclosure Package and the Prospectus, except for such Permits the failure of the Company to possess or have obtained and except for such declarations and filings the failure of which to have made would not, in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has not received notice of any revocation or modification of any such Permits and has no reason to believe that any Permit will not be renewed in the ordinary course; and the Company is in compliance with all applicable federal, state, and local laws, regulations, orders and decrees except for those which the failure to be in compliance with would not in the aggregate reasonably be expected to have a Material Adverse Effect.

          (pp) Except as described in the most recent Preliminary Prospectus, the Pricing Disclosure Package and the Prospectus, since April 1, 2007, the Company: (i) is and at all times has

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been in full compliance with all statutes, rules, regulations, or guidance applicable to the conduct of the Company’s business (“Applicable Laws”), except for such noncompliance as would not reasonably be expected, in the aggregate, to have a Material Adverse Effect; (ii) possesses all material licenses, certificates, approvals, clearances, authorizations, permits and supplements or amendments thereto required by any Applicable Laws (“Authorizations”) except for those the failure of which to possess would not in the aggregate reasonably be expected to have a Material Adverse Effect and such Authorizations are valid and in full force and effect and the Company is not in violation of any term of any such Authorizations except for those violations which would not in the aggregate reasonably be expected to have a Material Adverse Effect; (iii) has not received notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any Governmental Authority or third party alleging that any Company operation or activity is in violation of any Applicable Laws or Authorizations and has no knowledge that any such Governmental Authority or third party is considering any such claim, litigation, arbitration, action, suit, investigation or proceeding; (iv) has not received notice that any Governmental Authority has taken, is taking or intends to take action to limit, suspend, modify or revoke any Authorizations and has no knowledge that any such Governmental Authority is considering such action; and (v) has filed, obtained, maintained or submitted all material reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments as required by any Applicable Laws or Authorizations and that all such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments were complete and correct on the date filed in all material respects (or were corrected or supplemented by a subsequent submission).

          (qq) the Company has (i) good and marketable title to (A) all its interests in the producing gas and oil interests described in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Pricing Disclosure Package and (B) all other material real property reflected as assets owned by it in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Pricing Disclosure Package, and (ii) good title to substantially all personal property reflected as assets owned by it in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Pricing Disclosure Package, in each case free and clear of all liens, security interests, pledges, charges, encumbrances, mortgages, claims or defects (collectively, “Liens”), except such Liens (w) as are disclosed in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Pricing Disclosure Package, (x) as could not reasonably be expected to have a Material Adverse Effect, (y) securing taxes and other governmental charges, or claims of materialmen, mechanics and similar persons, not yet due and payable, or (z) under oil and gas leases, options to lease, operating agreements, utilization and pooling agreements, participation and drilling concessions agreements and gas sales contracts, securing payment of amounts not yet due and payable and of a scope and nature customary in the oil and gas industry. Any real property or personal property held under lease by the Company is held under leases enforceable against the Company and to the knowledge of the Company, enforceable against the lessor, with such exceptions as are disclosed in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Pricing Disclosure Package or as would not reasonably be expected to have a Material Adverse Effect, and the Company has not received any written notice of any material claim that has been asserted by anyone adverse to the rights of the Company under any such lease or affecting the rights of the Company to the continued possession of the leased premises under such lease; the gas and mineral leases, options to lease, drilling rights and concessions or other arrangements held by the Company reflect in all material respects the right of the Company to explore, develop or receive production from the unexplored and undeveloped acreage that the Company owns as described in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Pricing Disclosure Package, and the care taken by the Company with respect to acquiring or otherwise procuring such leases, options to lease, drilling

11

rights and concessions or other arrangements has been generally consistent with standard industry practices in the areas in which the Company operates for acquiring or procuring leases or interests therein to explore, develop or produce hydrocarbons; and title investigations have been carried out by or on behalf of the Company with respect to all its interests in the producing gas and oil interests described in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Pricing Disclosure Package, in accordance with reasonable practice in the gas industry in the areas in which the Company operates.

          (rr) Except as described in the most recent Preliminary Prospectus, the Company (i) is in compliance with any and all applicable federal, state and local laws, rules, regulations, treaties, statutes and codes promulgated by any and all Governmental Authorities (including pursuant to the Occupational Health and Safety Act) relating to the protection of human health and safety in the workplace (“Occupational Laws”); (ii) has received all material permits, licenses or other approvals required of it under applicable Occupational Laws to conduct its business as currently conducted; and (iii) is in compliance with all terms and conditions of such permits, licenses or approvals except in the case of clauses (i), (ii) and (iii) to the extent any such failure to comply or to have obtained permits, licenses or approvals, would not in the aggregate, reasonably be expected to have a Material Adverse Effect. No action, proceeding, revocation proceeding, writ, injunction or claim is pending or, to the Company’s knowledge, threatened against the Company relating to Occupational Laws, and the Company does not have knowledge of any facts, circumstances or developments relating to its operations or cost accounting practices that would reasonably be expected to form the basis for or give rise to such actions, suits, investigations or proceedings.

          (ss) Except as disclosed in the most recent Preliminary Prospectus, the Pricing Disclosure Package and the Prospectus, the Company owns or has the valid right to use all Intellectual Property (as defined below) necessary for the conduct of the business of the Company in the manner described in the most recent Preliminary Prospectus, the Pricing Disclosure Package and the Prospectus as now conducted or to be conducted, except for such Intellectual Property the failure of the Company to own or have the valid right to use would not in the aggregate reasonably be expected to have a Material Adverse Effect. Except as disclosed in the most recent Preliminary Prospectus, the Pricing Disclosure Package and the Prospectus (i) to the knowledge of the Company, no third party has infringed, misappropriated, diluted or otherwise violated in any material respect any Intellectual Property rights of the Company, and no claims for any of the foregoing have been brought against any third party by the Company; (ii) the Intellectual Property owned by the Company and, to the knowledge of the Company, the Intellectual Property licensed to the Company, in each case to the extent such Intellectual Property in the aggregate is material to the conduct of its business, have not been adjudged invalid or unenforceable, in whole or in part, and there is no pending or, to the knowledge of the Company, threatened action, suit, proceeding, investigation or claim challenging the validity, enforceability, scope, issuance/registration, use or ownership of any such Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such claim; (iii) there is no pending or, to the knowledge of the Company, threatened action, suit, proceeding or claim by others that the Company infringes, misappropriates, dilutes or otherwise violates any Intellectual Property of others, and the Company has not received any written notice of any such claim, and the Company has no knowledge of any facts which would form a reasonable basis for any such claim; (iv) the Company has taken commercially reasonable steps, consistent with industry standards, to maintain and protect all Intellectual Property that is material to the conduct of its business; and (v) to the knowledge of the Company, no current or former employee of the Company is in or has ever been in violation of any term of any employment contract, patent disclosure agreement, invention assignment agreement, non-competition agreement, non-solicitation

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agreement, nondisclosure agreement or any restrictive covenant where the basis of such violation relates to such employee’s employment with the Company, or actions undertaken by the employee while employed with the Company. The term “Intellectual Property” as used herein means all patents, trademarks, service marks, trade names, trade dress, domain names, copyrights, licenses, inventions, trade secrets, technology, software, systems, know-how and other intellectual property and proprietary rights.

          (tt) The Company (i) is, and at all times prior hereto was, in compliance with all laws, regulations, ordinances, rules, orders, judgments, decrees, permits or other legal requirements of any Governmental Authority, including without limitation any international, national, state, provincial, regional, or local authority, relating to the protection of human health or safety, the environment, or natural resources, or to hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”) applicable to such entity except for those the failure of which to be in compliance in the aggregate would not reasonably be expected to have a Material Adverse Effect, which compliance includes, without limitation, obtaining, maintaining and complying with all permits and authorizations and approvals required by Environmental Laws to conduct its business, and (ii) has not received notice of any actual or alleged violation of Environmental Laws, or of any potential liability for or other obligation concerning the presence, disposal or release of hazardous or toxic substances or wastes, pollutants or contaminants. Except as described in the most recent Preliminary Prospectus, (A) there are no proceedings that are pending, or to the Company’s knowledge, contemplated, against the Company under Environmental Laws in which a governmental authority is also a party, other than such proceedings regarding which it is reasonably believed no monetary sanctions of $100,000 or more will be imposed, (B) the Company has no knowledge of any issues regarding compliance with Environmental Laws, or liabilities or other obligations under Environmental Laws or concerning hazardous or toxic substances or wastes, pollutants or contaminants, that in the aggregate would reasonably be expected to have a Material Adverse Effect on the capital expenditures, earnings or competitive position of the Company, and (C) the Company does not anticipate material capital expenditures relating to Environmental Laws.

          (uu) The Company is not in violation of or received notice of any violation with respect to any federal or state law relating to discrimination in the hiring, promotion or pay of employees, nor any applicable federal or state wage and hour laws, nor any state law precluding the denial of credit due to the neighborhood in which a property is situated, the violation of any of which would reasonably be expected in the aggregate to have a Material Adverse Affect.

          (vv) Neither the Company, and, to the knowledge of the Company, no director, officer, agent, employee of the Company, or shareholder acting on behalf of the Company, has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

          (ww) The operations of the Company are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental

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agency, authority or body or any arbitrator involving the Company with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened, except, in each case referenced in this subparagraph (ww), as would not reasonably be expected in the aggregate to have a Material Adverse Effect.

          (xx) Neither the Company nor, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not directly or indirectly use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

          (yy) The information underlying the estimates of the Company’s proved reserves that was supplied to McCune Engineers, P.E. (the “Reserve Engineers”) for the purposes of preparing the reserve reports and estimates of the proved reserves of the Company disclosed in the Registration Statement, the Pricing Disclosure Package, the Preliminary Prospectus and the Prospectus, including production and costs of operation, was true and correct in all material respects on the dates such estimates were made, and such information was supplied and was prepared in accordance with customary industry practices; other than normal production of the reserves, natural gas price fluctuations, and fluctuations in demand for natural gas, and except as disclosed in the Registration Statement, the Pricing Disclosure Package, the Preliminary Prospectus and the Prospectus, the Company has no knowledge of any facts or circumstances that would result in a materially adverse change in the aggregate net reserves, or the present value of the future net cash flows therefrom, as described in the Registration Statement, the Pricing Disclosure Package, the Preliminary Prospectus and the Prospectus and as reflected in the reports the Reserve Engineers prepared with regard to the reserves that the Company owns; the estimates of such reserves and present value as described in the Registration Statement, the Pricing Disclosure Package, the Preliminary Prospectus and the Prospectus and reflected in the reports referenced therein have been prepared in a manner that complies in all material respects with the applicable requirements of the rules under the Securities Act with respect to proved reserves.

          (zz) To the knowledge of the Company, neither the Reserve Engineers nor any of the Reserve Engineers’ employees, officers or directors, own any interests in the Company or any oil and gas properties covered by the Reserve Report.

          (aaa) The Company has not distributed and, prior to the later to occur of any Delivery Date and completion of the distribution of the Stock, will not distribute any offering material in connection with the offering and sale of the Stock other than any Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus to which the Representative have consented in accordance with Section 1(h) or 5(a)(vi) of this Agreement.

          (bbb) The Company has not taken and will not take, directly or indirectly, any action designed to or that has constituted or that would reasonably be expected to cause or result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the shares of the Stock.

          (ccc) The Stock has been approved for listing, subject to official notice of issuance and evidence of satisfactory distribution, on The American Stock Exchange. There are no affiliations

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with the Financial Industry Regulatory Authority (the “FINRA”) among the Company’s officers or directors.

     2. Purchase of the Stock by the Underwriters. On the basis of the representations and warranties contained in, and subject to the terms and conditions of, this Agreement, the Company agrees to sell [                    ] shares of the Firm Stock to the several Underwriters, and each of the Underwriters, severally and not jointly, agrees to purchase the number of shares of the Firm Stock set forth opposite that Underwriter’s name in Schedule 1 hereto. The respective purchase obligations of the Underwriters with respect to the Firm Stock shall be rounded among the Underwriters to avoid fractional shares, as the Representative may determine.

     In addition, the Company grants to the Underwriters an option to purchase up to [                    ] additional shares of Option Stock. Such option is exercisable in the event that the Underwriters sell more shares of Common Stock than the number of shares of Firm Stock in the offering and as set forth in Section 4 of this Agreement. Each Underwriter agrees, severally and not jointly, to purchase the number of shares of Option Stock (subject to such adjustments to eliminate fractional shares as the Representative may determine) that bears the same proportion to the total number of shares of Option Stock to be sold on such Delivery Date as the number of shares of Firm Stock set forth in Schedule 1 attached hereto opposite the name of such Underwriter bears to the total number of shares of Firm Stock.

     The price of both the Firm Stock and any Option Stock purchased by the Underwriters shall be $[                    ] per share.

     The Company shall not be obligated to deliver any of the Firm Stock or Option Stock to be delivered on the applicable Delivery Date, except upon payment for all such Stock to be purchased on such Delivery Date as provided herein.

     3. Offering of Stock by the Underwriters. Upon authorization by the Representative of the release of the Firm Stock, the several Underwriters propose to offer the Firm Stock for sale upon the terms and conditions to be set forth in the Prospectus.

     4. Delivery of and Payment for the Stock. Delivery of and payment for the Firm Stock shall be made at 10:00 A.M., New York City time, on the third full business day following the date of this Agreement or at such other date or place as shall be determined by agreement between the Representative and the Company. This date and time are sometimes referred to as the “Initial Delivery Date.” Delivery of the Firm Stock shall be made to the Representative for the account of each Underwriter against payment by the several Underwriters through the Representative of the respective aggregate purchase prices of the Firm Stock being sold by the Company to or upon the order of the Company of the purchase price by wire transfer in immediately available funds to the accounts specified by the Company. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. The Company shall deliver the Firm Stock through the facilities of DTC unless the Representative shall otherwise instruct.

     The option granted in Section 2 of this Agreement will expire 30 days after the date of this Agreement and may be exercised in whole or from time to time in part by written notice being given to the Company by the Representative; provided that if such date falls on a day that is not a business day, the option granted in Section 2 of this Agreement will expire on the next succeeding business

15

day and provided further that the Representative shall be limited to two such notices in the aggregate. Each such notice shall set forth the aggregate number of shares of Option Stock as to which the option is being exercised, the names in which the shares of Option Stock are to be registered, the denominations in which the shares of Option Stock are to be issued and the date and time, as determined by the Representative, when the shares of Option Stock are to be delivered; provided, however, that this date and time shall not be earlier than the Initial Delivery Date nor earlier than the second business day after the date on which the option shall have been exercised nor later than the fifth business day after the date on which the option shall have been exercised. Each date and time the shares of Option Stock are delivered is sometimes referred to as an “Option Stock Delivery Date,” and the Initial Delivery Date and any Option Stock Delivery Date are sometimes each referred to as a “Delivery Date.”

     Delivery of the Option Stock by the Company and payment for the Option Stock by the several Underwriters through the Representative shall be made at 10:00 A.M., New York City time, on the date specified in the corresponding notice described in the preceding paragraph or at such other date or place as shall be determined by agreement between the Representative and the Company. On each Option Stock Delivery Date, the Company shall deliver or cause to be delivered the Option Stock to the Representative for the account of each Underwriter against payment by the several Underwriters through the Representative of the respective aggregate purchase prices of the Option Stock being sold by the Company to or upon the order of the Company of the purchase price by wire transfer in immediately available funds to the accounts specified by the Company. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. The Company shall deliver the Option Stock through the facilities of DTC unless the Representative shall otherwise instruct.

     5. Further Agreements of the Company and the Underwriters.

          (a) The Company agrees:

               (i) To prepare the Prospectus in a form approved by the Representative and to file such Prospectus pursuant to Rule 424(b) under the Securities Act not later than the Commission’s close of business on the second business day following the execution and delivery of this Agreement; to make no further amendment or any supplement to the Registration Statement or the Prospectus prior to the last Delivery Date except as provided herein; to advise the Representative, promptly after it receives notice thereof, of the time when any amendment or supplement to the Registration Statement or the Prospectus has been filed and to furnish the Representative with copies thereof; to advise the Representative, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of the Prospectus or any Issuer Free Writing Prospectus, of the suspension of the qualification of the Stock for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding or examination for any such purpose or of any request by the Commission for the amending or supplementing of the Registration Statement, the Prospectus or any Issuer Free Writing Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of the Prospectus or any Issuer Free Writing Prospectus or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal;

               (ii) To furnish promptly to each of the Representative and to counsel for the Underwriters a signed copy of the Registration Statement as originally filed with the

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Commission, and each amendment thereto filed with the Commission, including all consents and exhibits filed therewith;

               (iii) To deliver promptly to the Representative such number of the following documents as the Representative shall reasonably request: (A) conformed copies of the Registration Statement as originally filed with the Commission and each amendment thereto (in each case excluding exhibits other than this Agreement and the computation of per share earnings), (B) each Preliminary Prospectus, the Prospectus and any amended or supplemented Prospectus and (C) each Issuer Free Writing Prospectus; and, if the delivery of a prospectus is required at any time after the date hereof in connection with the offering or sale of the Stock or any other securities relating thereto and if at such time any events shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary to amend or supplement the Prospectus in order to comply with the Securities Act, to notify the Representative and, upon their request, to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representative may from time to time reasonably request of an amended or supplemented Prospectus that will correct such statement or omission or effect such compliance;

               (iv) To file promptly with the Commission any amendment or supplement to the Registration Statement or the Prospectus that may, in the judgment of the Company or the Representative, be required by the Securities Act or reasonably requested by the Commission;

               (v) Prior to filing with the Commission any amendment or supplement to the Registration Statement or the Prospectus, to furnish a copy thereof to the Representative and counsel for the Underwriters and obtain the consent of the Representative to the filing;

               (vi) Not to make any offer relating to the Stock that would constitute an Issuer Free Writing Prospectus without the prior written consent of the Representative.

               (vii) To comply with all applicable requirements of Rule 433 with respect to any Issuer Free Writing Prospectus; and if at any time after the date hereof any events shall have occurred as a result of which any Issuer Free Writing Prospectus, as then amended or supplemented, would conflict with the information in the Registration Statement, the most recent Preliminary Prospectus or the Prospectus or would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or, if for any other reason it shall be necessary to amend or supplement any Issuer Free Writing Prospectus, to notify the Representative and, upon its request, to file such document and to prepare and furnish without charge to each Underwriter as many copies as the Representative may from time to time reasonably request of an amended or supplemented Issuer Free Writing Prospectus that will correct such conflict, statement or omission or effect such compliance;

               (viii) As soon as practicable after the Effective Date (it being understood that the Company shall have until at least 410 days or, if the fourth quarter following the fiscal quarter that includes the Effective Date is the last fiscal quarter of the Company’s fiscal year, 455 days after the end of the Company’s current fiscal quarter), to make generally available to the Company’s security holders and to deliver to the Representative an earnings statement of the

17

Company (which need not be audited) complying with Section 11(a) of the Securities Act and the Rules and Regulations (including, at the option of the Company, Rule 158);

               (ix) Promptly from time to time to take such action as the Representative may reasonably request to qualify the Stock for offering and sale under the securities laws of such jurisdictions as the Representative may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Stock; provided that in connection therewith the Company shall not be required to (i) qualify as a foreign corporation in any jurisdiction in which it would not otherwise be required to so qualify, (ii) file a general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any jurisdiction in which it would not otherwise be subject;

               (x) For a period commencing on the date of the Prospectus and ending on the number of days set forth below depending on the type of the Company’s securities held by the holder) after the date of the Prospectus, not to, directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of (or enter into any transaction or device that is designed to, or would reasonably be expected to, result in the disposition by any person at any time in the future of) any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other than Common Stock issued as of the date of the Prospectus or which may in the future be issued pursuant to employee benefit plans, Common Stock issued as compensation to directors of the Company, stock option plans for employees of the Company or other employee compensation plans existing as of the date of the Prospectus or the Underwriter Warrants), or sell or grant options, rights or warrants with respect to any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other than options granted as of the date of the Prospectus or which the Company may in the future grant pursuant to employee benefit plans, stock option plans for employees or other employee compensation plans existing as of the date of the Prospectus), (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or risks of ownership of such shares of Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or other securities, in cash or otherwise, (3) file or cause to be filed a registration statement, including any amendments, with respect to the registration of any shares of Common Stock or securities convertible, exercisable or exchangeable into Common Stock or any other securities of the Company, other than a registration statement filed to satisfy the Company’s obligations pursuant to that certain Registration Rights Agreement, dated April 11, 2007, by and among the Company and the investors party thereto, as amended from time to time, or (4) publicly disclose the intention to do any of the foregoing, in each case without the prior written consent of C.K. Cooper & Company, Inc., on behalf of the Underwriters, and to cause each officer, director and stockholder of the Company set forth on Schedule 2 attached hereto to furnish to the Representative, prior to the Initial Delivery Date, a letter or letters, substantially in the form attached hereto Exhibit A (the “Lock-Up Agreements”). The lock-up period commences on the date of the Prospectus and terminates sixty days thereafter in the case of debt holders holding debentures issued by the Company (the “Debenture Holders Lock-Up Period”) and 180 days from the date of the Prospectus with respect to executive officers, directors and certain stockholders (the “Equity Holders Lock-Up Period”), except either the Debenture Holders Lock-Up Period or the Equity Holders Lock-Up Period, as appropriate, may be extended as set forth below. Nothing in this Agreement, however, prohibits the Company from selling, issuing or registering capital stock in the event that the board of directors of the Company has determined that a change in control is reasonably likely to occur that is not in the best interests of the Company or its stockholders. Notwithstanding the foregoing, if (1) during the last 17 days of either the Debenture Holders Lock-Up Period or the Equity Holders Lock-Up Period, the Company issues an earnings

18

release or material news or a material event relating to the Company occurs or (2) prior to the expiration of either the Debenture Holders Lock-Up Period or the Equity Holders Lock-Up Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the applicable lock-up period, then the restrictions imposed in this paragraph shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or the occurrence of the material event, unless C.K. Cooper & Company, Inc., on behalf of the Underwriters, waives such extension in writing;

               (xi) To apply the net proceeds from the sale of the Stock being sold by the Company as set forth in the Prospectus;

               (xii) On the Initial Delivery Date, the Company shall issue to the Underwriters the Underwriter Warrants to purchase that number of shares of Common Stock equal to 5% of the Firm Stock (adjusted downward to the nearest whole share). On the Option Stock Delivery Date, the Company shall issue to the Underwriters additional Underwriter Warrants to purchase that number of shares of Common Stock equal to 5% of the Option Stock (adjusted downward to the nearest whole share) elected to be purchased by the Underwriters pursuant to Section 2. The Underwriter Warrants shall be in the form of Exhibit C attached hereto. The Underwriter Warrants shall have an exercise price per share equal to 135% of the initial public offering price per share of the Common Stock in the Offering and shall expire upon the 3^rd anniversary of the respective Underwriter Warrants date of issuance. The Underwriter Warrants shall be issued by the Company, severally and not jointly, for the accounts of the several Underwriters in proportion to the number of shares of Firm Stock set forth opposite such Underwriter’s name in Schedule I hereto, or in proportion to the number of shares of Option Stock elected to be purchased by such Underwriter, as applicable, except that the respective Underwriter Warrants of each Underwriter shall be adjusted by the Representative so that no Underwriter Warrants to be issued to an Underwriter shall represent the right to purchase a fractional share of Common Stock; and

               (xiii) The Company will use its best efforts to have the Common Stock reserved for issuance under the Underwriter Warrants listed on the American Stock Exchange.

          (b) Each Underwriter severally agrees that such Underwriter shall not include any “issuer information” (as defined in Rule 433) in any “free writing prospectus” (as defined in Rule 405) used or referred to by such Underwriter without the prior consent of the Company (any such issuer information with respect to whose use the Company has given its consent, “Permitted Issuer Information”); provided that (i) no such consent shall be required with respect to any such issuer information contained in any document filed by the Company with the Commission prior to the use of such free writing prospectus and (ii) “issuer information,” as used in this Section 5(b), shall not be deemed to include information prepared by or on behalf of such Underwriter on the basis of or derived from issuer information.

     6. Expenses. The Company agrees, whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, to pay all costs, expenses, fees and taxes incident to and in connection with (a) the authorization, issuance, sale and delivery of the Stock and any stamp duties or other taxes payable in that connection, and the preparation and printing of certificates for the Stock; (b) the preparation, printing and filing under the Securities Act of the Registration Statement (including any exhibits thereto), any Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus and any amendment or supplement thereto; (c) the

19

distribution of the Registration Statement (including any exhibits thereto), any Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus and any amendment or supplement thereto, all as provided in this Agreement; (d) the production and distribution of this Agreement, any supplemental agreement among Underwriters, and any other related documents in connection with the offering, purchase, sale and delivery of the Stock; (e) any required review by FINRA of the terms of sale of the Stock (including related fees and expenses of counsel to the Underwriters); (f) the inclusion of the Stock on the American Stock Exchange and/or any other exchange; (g) the qualification of the Stock under the securities laws of the several jurisdictions as provided in Section 5(a)(ix) of this Agreement and the preparation, printing and distribution of a Blue Sky Memorandum (including related fees and expenses of counsel to the Underwriters); (h) the fees and expenses of the Underwriters’ legal counsel; (i) the investor presentations on any “road show” undertaken in connection with the marketing of the Stock, including, without limitation, expenses associated with any electronic roadshow, travel and lodging expenses of the Representative and officers of the Company; and (j) all other costs and expenses incident to the performance of the obligations of the Company under this Agreement; provided that, except as provided in this Section 6 and in Section 11 of this Agreement, the Underwriters shall pay all of their own costs and expenses, including the costs and expenses of their counsel, any transfer taxes on the Stock which they may sell and the expenses of advertising any offering of the Stock made by the Underwriters.

     7. Conditions of Underwriters’ Obligations. The respective obligations of the Underwriters hereunder are subject to the accuracy, when made and on each Delivery Date, of the representations and warranties of the Company contained herein, to the performance by the Company of its obligations hereunder, and to each of the following additional terms and conditions:

          (a) The Prospectus shall have been timely filed with the Commission in accordance with Section 5(a)(i) of this Agreement; the Company shall have complied with all filing requirements applicable to any Issuer Free Writing Prospectus used or referred to after the date hereof; no stop order suspending the effectiveness of the Registration Statement or preventing or suspending the use of the Prospectus or any Issuer Free Writing Prospectus shall have been issued and no proceeding or examination for such purpose shall have been initiated or threatened by the Commission; and any request of the Commission for inclusion of additional information in the Registration Statement or the Prospectus or otherwise shall have been complied with.

          (b) No Underwriter shall have discovered and disclosed to the Company on or prior to such Delivery Date that the Registration Statement, the Prospectus or the Pricing Disclosure Package, or any amendment or supplement thereto, contains an untrue statement of a fact which, in the reasonable opinion of Stradling Yocca Carlson & Rauth, counsel for the Underwriters, is material or omits to state a fact which, in the opinion of such counsel, is material and is required to be stated therein or is necessary to make the statements therein not misleading.

          (c) All corporate proceedings and other legal matters incident to the authorization, form and validity of this Agreement, the Stock, the Registration Statement, the Prospectus and any Issuer Free Writing Prospectus, and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be reasonably satisfactory in all material respects to counsel for the Underwriters, and the Company shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters.

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          (d) Husch Blackwell Sanders LLP shall have furnished to the Representative its written opinion, as counsel to the Company, addressed to the Underwriters and dated such Delivery Date, in form and substance reasonably satisfactory to the Representative, substantially in the form attached hereto as Exhibit B.

          (e) The Representative shall have received from Stradling Yocca Carlson & Rauth, counsel for the Underwriters, such opinion or opinions, dated such Delivery Date, with respect to the issuance and sale of the Stock, the Registration Statement, the Prospectus and the Pricing Disclosure Package and other related matters as the Representative may reasonably require, and the Company shall have furnished to such counsel such documents as they reasonably request for the purpose of enabling them to pass upon such matters.

          (f) At the time of execution of this Agreement, the Representative shall have received from Weaver & Martin, LLC a letter, in form and substance satisfactory to the Representative, addressed to the Underwriters and dated the date hereof (i) confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, and (ii) stating, as of the date hereof (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the most recent Preliminary Prospectus, as of a date not more than three days prior to the date hereof), the conclusions and findings of such firm with respect to the financial information and other matters ordinarily covered by accountants’ “comfort letters” to underwriters in connection with registered public offerings.

          (g) With respect to the letter of Weaver & Martin, LLC referred to in the preceding paragraph and delivered to the Representative concurrently with the execution of this Agreement (the “initial letter”), the Company shall have furnished to the Representative a letter (the “bring-down letter”) of such accountants, addressed to the Underwriters and dated such Delivery Date (i) confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X, (ii) stating, as of the date of the bring-down letter (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Prospectus, as of a date not more than three days prior to the date of the bring-down letter), the conclusions and findings of such firm with respect to the financial information and other matters covered by the initial letter and (iii) confirming in all material respects the conclusions and findings set forth in the initial letter.

          (h) The Company shall have requested and caused McCune Engineers, P.E., to have furnished to the Representative, at the time of the execution of this Agreement and on each Delivery Date, letters, dated respectively as of time of the execution of this Agreement and on each Delivery Date, in form and substance reasonably satisfactory to the Representative, confirming that they are independent petroleum engineers with respect to the Company; and that they have evaluated the estimates of proved reserves and future net revenue (including discounted values thereof) attributable to interests of the Company, in certain oil and gas properties as of March 31, 2008 (the “Reserve Report”) and stating in effect that:

               (i) they are familiar with the standards pertaining to the estimating and auditing of oil and gas reserve information promulgated by the Commission. Neither they, nor to their knowledge, any of their employees, officers or directors, own interests in the Company or any

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oil and gas properties covered by the Reserve Report. They have not been employed by the Company on a contingent basis;

               (ii) in their opinion, the information relating to estimated proved reserves, estimated future net revenue from proved reserves, and present worth of estimated future net revenue from proved reserves contained in the Reserves Report has been prepared in a manner consistent with the standards and definitions pertaining to the estimating and auditing of oil and gas reserve information promulgated by the Commission. Specifically, such information has been prepared in accordance with Paragraphs 10-13, 15, and 30(a)-(b) of Statement of Financial Accounting Standards No. 69 (November 1982) of the FASB and Rules 4-10(a)(1)-(13) of Regulation S-X and Rule 302(b) of Regulation S-K of the Commission;

               (iii) no additional information has been brought to their attention that would lead them to believe that there would be a material change in the estimates of proved reserves or future net revenues from proved reserves attributable to the interests of the Company in certain oil and gas properties covered by the Reserve Report, notwithstanding those changes that would result from a change in product prices and reductions for production since June 30, 2008; and

               (iv) the Representative and the Underwriters may rely upon the Reserve Report in the same manner as if such report was addressed to the Representative and the Underwriters.

          (i) The Company shall have furnished to the Representative a certificate, dated such Delivery Date, of its Chief Executive Officer and its Chief Financial Officer stating that:

               (i) The representations, warranties and agreements of the Company in Section 1 of this Agreement are true and correct on and as of such Delivery Date, and the Company has complied with all its agreements contained herein and satisfied all the conditions on its part to be performed or satisfied hereunder at or prior to such Delivery Date;

               (ii) No stop order suspending the effectiveness of the Registration Statement has been issued; and no proceedings or examination for that purpose have been instituted or, to the knowledge of such officers, threatened; and

               (iii) They have carefully examined the Registration Statement, the Prospectus and the Pricing Disclosure Package, and, in their opinion, (A) (1) the Registration Statement, as of the Effective Date, (2) the Prospectus, as of its date and on the applicable Delivery Date, or (3) the Pricing Disclosure Package, as of the Applicable Time, did not and do not contain any untrue statement of a material fact and did not and do not omit to state a material fact required to be stated therein or necessary to make the statements therein (except in the case of the Registration Statement, in the light of the circumstances under which they were made) not misleading, and (B) since the Effective Date, no event has occurred that should have been set forth in a supplement or amendment to the Registration Statement, the Prospectus or any Issuer Free Writing Prospectus that has not been so set forth;

          (j) The Company shall not have sustained, since the date of the latest periodic report filed under Section 13 or 15(d) of the Exchange Act which contain the same financial statements which are also included in the most recent Preliminary Prospectus, any (i) loss or

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interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree or (ii) since such date there shall not have been any change in the capital stock, long-term debt, net current assets or short-term debt of the Company or any change, or any development involving a prospective change, in or affecting the condition (financial or otherwise), results of operations, stockholders’ equity, properties, management, business or prospects of the Company other than as set forth or contemplated in the Preliminary Prospectus, the effect of which, in any such case described in clause (i) or (ii), is, in the reasonable judgment of the Representative, so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Stock being delivered on such Delivery Date on the terms and in the manner contemplated in the Prospectus, except in the case of clause (ii), as it relates to refinancing of outstanding indebtedness or additional capital for development projects, the terms of which have been previously provided to the Underwriters, or as it relates to capital stock, such matters permitted under Section 5(a)(x) of this Agreement.

          (k) Subsequent to the execution and delivery of this Agreement (i) no downgrading shall have occurred in the rating accorded the Company’s debt securities or preferred stock by any “nationally recognized statistical rating organization” (as that term is defined by the Commission for purposes of Rule 436(g)(2) of the Rules and Regulations), and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company’s debt securities or preferred stock.

          (l) Subsequent to the execution and delivery of this Agreement there shall not have occurred any of the following: (i) trading in securities generally on any national securities exchange or in the over-the-counter market, or trading in any securities of the Company on any exchange or in the over-the-counter market, shall have been suspended or materially limited or the settlement of such trading generally shall have been materially disrupted or minimum prices shall have been established on any such exchange or such market by the Commission, by such exchange or by any other regulatory body or governmental authority having jurisdiction, (ii) a banking moratorium shall have been declared by federal or state authorities, (iii) the United States shall have become engaged in hostilities, there shall have been an escalation in hostilities involving the United States or there shall have been a declaration of a national emergency or war by the United States or (iv) there shall have occurred such a material adverse change in general economic, political or financial conditions, including, without limitation, as a result of significant terrorist activities after the date hereof (or the effect of international conditions on the financial markets in the United States shall be such), as to make it, in the judgment of the Representative, impracticable or inadvisable to proceed with the public offering or delivery of the Stock being delivered on such Delivery Date on the terms and in the manner contemplated in the Prospectus.

          (m) The American Stock Exchange shall have approved the Stock for inclusion, subject only to official notice of issuance and evidence of satisfactory distribution.

          (n) The Lock-Up Agreements between the Representative and the officers, directors, officers and stockholders of the Company set forth on Schedule 2 attached hereto, delivered to the Representative on or before the date of this Agreement, shall be in full force and effect on such Delivery Date.

          (o) At each Closing Date, Stradling Yocca Carlson & Rauth, counsel for the Underwriters, shall have been furnished with such information, certificates and documents as they

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may reasonably request for the purpose of enabling them to pass upon the issuance and sale of the Stock as contemplated herein and related proceedings, or to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained, or otherwise in connection with the offering of the Stock contemplated hereby.

     All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Underwriters.

     8. Indemnification and Contribution.

          (a) The Company shall indemnify and hold harmless each Underwriter, its directors, officers and employees and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Securities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating to purchases and sales of Stock), to which that Underwriter, director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in (A) any Preliminary Prospectus, the Registration Statement, the Prospectus or in any amendment or supplement thereto, (B) any Issuer Free Writing Prospectus or in any amendment or supplement thereto or (C) any Permitted Issuer Information used or referred to in any “free writing prospectus” (as defined in Rule 405) used or referred to by any Underwriter, (D) any “road show” (as defined in Rule 433) not constituting an Issuer Free Writing Prospectus (a “Non-Prospectus Road Show”) or (E) any Blue Sky application or other document prepared or executed by the Company (or based upon any written information furnished by the Company for use therein) specifically for the purpose of qualifying any or all of the Stock under the securities laws of any state or other jurisdiction (any such application, document or information being hereinafter called a “Blue Sky Application”) or (ii) the omission or alleged omission to state in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Permitted Issuer Information, any Non-Prospectus Road Show or any Blue Sky Application, any material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse each Underwriter and each such director, officer, employee or controlling person promptly upon demand for any legal or other expenses reasonably incurred by that Underwriter, director, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any such amendment or supplement thereto or in any Permitted Issuer Information, any Non-Prospectus Road Show or any Blue Sky Application, in reliance upon and in conformity with written information concerning such Underwriter furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein, which information consists solely of the information specified in Section 8(e) of this Agreement. The foregoing indemnity agreement is in addition to any liability which the Company may otherwise have to any Underwriter or to any director, officer, employee or controlling person of that Underwriter.

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          (b) Each Underwriter, severally and not jointly, shall indemnify and hold harmless the Company, its directors (including any person who, with his or her consent, is named in the Registration Statement as about to become a director of the Company), officers and employees, and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof, to which the Company or any such director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, the Registration Statement, the Prospectus, or any amendment or supplement thereto, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Non-Prospectus Road Show or Blue Sky Application, or (ii) the omission or alleged omission to state in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Non-Prospectus Road Show or Blue Sky Application, any material fact required to be stated therein or necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information concerning such Underwriter furnished to the Company through the Representative by or on behalf of that Underwriter specifically for inclusion therein, which information is limited to the information set forth in Section 8(e) of this Agreement. The foregoing indemnity agreement is in addition to any liability that any Underwriter may otherwise have to the Company or any such director, officer, employee or controlling person.

          (c) Promptly after receipt by an indemnified party under this Section 8 of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 8, notify the indemnifying party in writing of the claim or the commencement of that action; provided, however, that the failure to notify the indemnifying party shall not relieve it from any liability which it may have under this Section 8 except to the extent it has been materially prejudiced by such failure and, provided, further, that the failure to notify the indemnifying party shall not relieve it from any liability which it may have to an indemnified party otherwise than under this Section 8. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section 8 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that the indemnified party shall have the right to employ counsel to represent jointly the indemnified party and those other indemnified parties and their respective directors, officers, employees and controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought under this Section 8 if (i) the indemnified party and the indemnifying party shall have so mutually agreed; (ii) the indemnifying party has failed within a reasonable time to retain counsel reasonably satisfactory to the indemnified party; (iii) the indemnified party and its directors, officers, employees and controlling persons shall have reasonably concluded that there may be legal defenses available to them that are different from or in addition to those available to the indemnifying party; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the indemnified parties or their respective directors, officers, employees or controlling persons, on the one hand, and the indemnifying party, on the other hand, and representation of both sets of parties by the same counsel would be inappropriate

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due to actual or potential differing interests between them, and in any such event the fees and expenses of such separate counsel shall be paid by the indemnifying party. No indemnifying party shall (i) without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and does not include any findings of fact or admissions of fault or culpability as to the indemnified party, or (ii) be liable for any settlement of any such action effected without its written consent (which consent shall not be unreasonably withheld), but if settled with the consent of the indemnifying party or if there be a final judgment for the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment.

          (d) If the indemnification provided for in this Section 8 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 8(a), 8(b), or 8(f) of this Agreement in respect of any loss, claim, damage or liability, or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company, on the one hand, and the Underwriters, on the other, from the offering of the Stock or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, on the one hand, and the Underwriters, on the other, with respect to the statements or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative benefits received by the Company, on the one hand, and the Underwriters, on the other, with respect to such offering shall be deemed to be in the same proportion as the total net proceeds from the offering of the Stock purchased under this Agreement (before deducting expenses) received by the Company, as set forth in the table on the cover page of the Prospectus, on the one hand, and the total underwriting discounts and commissions received by the Underwriters with respect to the shares of the Stock purchased under this Agreement, as set forth in the table on the cover page of the Prospectus, on the other hand. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 8(d) were to be determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respect thereof, referred to above in this Section 8(d) shall be deemed to include, for purposes of this Section 8(d), any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8(d), no Underwriter shall be required to contribute any amount in excess of the amount by which the net proceeds from the sale of the Stock underwritten by it exceeds the amount of any damages that such Underwriter has otherwise paid or become liable to pay by reason of any untrue or alleged untrue statement or omission or

26

alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters’ obligations to contribute as provided in this Section 8(d) are several in proportion to their respective underwriting obligations and not joint.

          (e) The Underwriters severally confirm and the Company acknowledges and agrees that the statements regarding delivery of shares by the Underwriters set forth on the cover page of, and the concession and reallowance figures and the paragraph relating to stabilization by the Underwriters appearing under the caption “Underwriting” in, the most recent Preliminary Prospectus and the Prospectus are correct and constitute the only information concerning such Underwriters furnished in writing to the Company by or on behalf of the Underwriters specifically for inclusion in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Non-Prospectus Road Show.

     9. Defaulting Underwriters. If, on any Delivery Date, any Underwriter defaults in the performance of its obligations under this Agreement, the remaining non-defaulting Underwriters shall be obligated to purchase the Stock that the defaulting Underwriter agreed but failed to purchase on such Delivery Date in the respective proportions which the number of shares of the Firm Stock set forth opposite the name of each remaining non-defaulting Underwriter in Schedule 1 attached hereto bears to the total number of shares of the Firm Stock set forth opposite the names of all the remaining non-defaulting Underwriters in Schedule 1 attached hereto; provided, however, that the remaining non-defaulting Underwriters shall not be obligated to purchase any of the Stock on such Delivery Date if the total number of shares of the Stock that the defaulting Underwriter or Underwriters agreed but failed to purchase on such date exceeds 10% of the total number of shares of the Stock to be purchased on such Delivery Date, and any remaining non-defaulting Underwriter shall not be obligated to purchase more than 110% of the number of shares of the Stock that it agreed to purchase on such Delivery Date pursuant to the terms of Section 2 of this Agreement. If the foregoing maximums are exceeded, the remaining non-defaulting Underwriters, or those other underwriters satisfactory to the Representative who so agree, shall have the right, but shall not be obligated, to purchase, in such proportion as may be agreed upon among them, all the Stock to be purchased on such Delivery Date. If the remaining Underwriters or other underwriters satisfactory to the Representative do not elect to purchase the shares that the defaulting Underwriter or Underwriters agreed but failed to purchase on such Delivery Date, this Agreement (or, with respect to any Option Stock Delivery Date, the obligation of the Underwriters to purchase, and of the Company to sell, the Option Stock) shall terminate without liability on the part of any non-defaulting Underwriter or the Company, except that the Company and the Underwriters will continue to be liable for the payment of expenses to the extent set forth in Sections 6 and 11 of this Agreement. As used in this Agreement, the term “Underwriter” includes, for all purposes of this Agreement unless the context requires otherwise, any party not listed in Schedule 1 attached hereto that, pursuant to this Section 9, purchases Stock that a defaulting Underwriter agreed but failed to purchase.

     Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Company for damages caused by its default. If other Underwriters are obligated or agree to purchase the Stock of a defaulting or withdrawing Underwriter, either the Representative or the Company may postpone the Delivery Date for up to seven full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Underwriters may be necessary in the Registration Statement, the Prospectus or in any other document or arrangement.

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     10. Termination. The obligations of the Underwriters hereunder may be terminated by the Representative by notice given to and received by the Company prior to delivery of and payment for the Firm Stock if, prior to that time, any of the events described in Sections 7(j), 7(k) and 7(l) of this Agreement shall have occurred or if the Underwriters shall decline to purchase the Stock for any reason permitted under this Agreement.

     11. Reimbursement of Underwriters’ Expenses. If the Company shall fail to tender the Stock for delivery to the Underwriters for any reason or (b) the Underwriters shall decline to purchase the Stock for any reason permitted under this Agreement, the Company will reimburse the Underwriters for all reasonable out-of-pocket expenses (including fees and disbursements of counsel) incurred by the Underwriters in connection with this Agreement and the proposed purchase of the Stock, and upon demand the Company shall pay the full amount thereof to the Representative. If this Agreement is terminated pursuant to Section 9 of this Agreement by reason of the default of one or more Underwriters, the Company will not be obligated to reimburse any Underwriter or Underwriters on account of those expenses.

     12. Research Analyst Independence. The Company acknowledges that the Underwriters’ research analysts and research departments are required to be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and that such Underwriters’ research analysts may hold views and make statements or investment recommendations and/or publish research reports with respect to the Company and/or the offering that differ from the views of their respective investment banking divisions. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters with respect to any conflict of interest that may arise from the fact that the views expressed by their independent research analysts and research departments may be different from or inconsistent with the views or advice communicated to the Company by such Underwriters’ investment banking divisions. The Company acknowledges that each of the Underwriters is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short positions in debt or equity securities of the companies that may be the subject of the transactions contemplated by this Agreement.

     13. No Fiduciary Duty. The Company acknowledges and agrees that in connection with this offering, sale of the Stock or any other services the Underwriters may be deemed to be providing hereunder, notwithstanding any preexisting relationship, advisory or otherwise, between the parties or any oral representations or assurances previously or subsequently made by the Underwriters: (i) no fiduciary or agency relationship between the Company and any other person, on the one hand, and the Underwriters, on the other, exists; (ii) the Underwriters are not acting as advisors, expert or otherwise, to the Company, including, without limitation, with respect to the determination of the public offering price of the Stock, and such relationship between the Company, on the one hand, and the Underwriters, on the other, is entirely and solely commercial, based on arms-length negotiations; (iii) any duties and obligations that the Underwriters may have to the Company shall be limited to those duties and obligations specifically stated herein; and (iv) the Underwriters and their respective affiliates may have interests that differ from those of the Company. The Company hereby waives any claims that the Company may have against the Underwriters with respect to any breach of fiduciary duty in connection with this offering.

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     14. Notices, Etc. All statements, requests, notices and agreements hereunder shall be in writing, and:

          (a) if to the Underwriters, shall be delivered or sent by mail or facsimile transmission to C.K. Cooper & Company, Inc., 18300 Von Karman Avenue, Suite 700, Irvine, California 92612, Attention: Syndicate Registration (Fax: 949-477-9211), with a copy to Stradling Yocca Carlson & Rauth, 660 Newport Center Drive, Suite 1600, Newport Beach, California 92660, Attention: Michael A. Hedge; and

          (b) if to the Company, shall be delivered or sent by mail or facsimile transmission to the address of the Company set forth in the Registration Statement, Attention: Steve Cochennet, (Fax: 913-693-4601), with a copy to Blackwell Sanders, LLP, 4801 Main Street, Suite 1000, Kansas City, MO 64112, Attention: Jeffrey T. Haughey and Craig A. Adoor.

Any such statements, requests, notices or agreements shall take effect at the time of receipt thereof. The Company shall be entitled to act and rely upon any request, consent, notice or agreement given or made on behalf of the Underwriters by C.K. Cooper & Company, Inc. as the Representative.

     15. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the Underwriters, the Company, and their respective successors. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (A) the representations, warranties, indemnities and agreements of the Company contained in this Agreement shall also be deemed to be for the benefit of the directors, officers and employees of the Underwriters and each person or persons, if any, who control any Underwriter within the meaning of Section 15 of the Securities Act and their respective heirs, executors, administrators, successors and assigns and (B) the indemnity agreement of the Underwriters contained in Section 8(b) of this Agreement shall be deemed to be for the benefit of the directors of the Company, the officers of the Company who have signed the Registration Statement and any person controlling the Company within the meaning of Section 15 of the Securities Act and their respective heirs, executors, administrators, successors and assigns. Nothing in this Agreement is intended or shall be construed to give any person, other than the persons referred to in this Section 15, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein.

     16. Survival. The respective indemnities, representations, warranties and agreements of the Company and the Underwriters contained in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall survive the delivery of and payment for the Stock and shall remain in full force and effect, regardless of any investigation made by or on behalf of any of them or any person controlling any of them.

     17. Definition of the Term “Business Day”. For purposes of this Agreement, “business day” means each Monday, Tuesday, Wednesday, Thursday or Friday that is not a day on which banking institutions in New York are generally authorized or obligated by law or executive order to close.

     18. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

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     19. Counterparts. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument.

     20. Amendments or Waivers. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.

     21. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.

[Signature Page Follows]

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     If the foregoing correctly sets forth the agreement between the Company and the Underwriters, please indicate your acceptance in the space provided for that purpose below.

Very truly yours,

ENERJEX RESOURCES, INC.

By:

Name:

Title:

Accepted:

C. K. COOPER & COMPANY, INC.

For themselves and as Representative
of the several Underwriters named
in Schedule 1 hereto

By C. K. COOPER & COMPANY, INC.

By:
	Authorized Representative

31

SCHEDULE 1

	Number of Shares of
Underwriters	Firm Stock(1)
C. K. Cooper & Company, Inc.		[                 ]
Joseph Gunnar & Co., LLC		[                 ]
Ladenburg Thalmann & Co., Inc.		[                 ]
		[                 ]
Total		[                 ]

⁽¹⁾ The Underwriters may purchase up to an additional [                    ] shares of Option Stock, to the extent the option described in Section 2 of the Agreement is exercised, in the proportions and in the manner described in the Agreement.

SCHEDULE 2

PERSONS DELIVERING LOCK-UP AGREEMENTS

Directors

Officers

Stockholders

Debenture Holders

SCHEDULE 3

ORALLY CONVEYED PRICING INFORMATION

1.	Public offering price
2.	Number of shares offered

EXHIBIT A

FORM OF LOCK-UP LETTER AGREEMENT

A-1

EXHIBIT B

FORM OF OPINION OF ISSUER’S COUNSEL

B-1

EXHIBIT C

THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT WITH RESPECT TO SUCH SECURITIES, OR DELIVERY OF AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE ISSUER OF THESE SECURITIES THAT SUCH REGISTRATION IS NOT REQUIRED.

ENERJEX RESOURCES, INC.
COMMON STOCK WARRANT

No: _____

Date of Issuance: September __, 2008

     FOR VALUE RECEIVED, EnerJex Resources, Inc., a Nevada corporation (the “Company”), hereby grants a warrant to purchase shares of Common Stock of the Company in the amount and at the per share exercise price set forth in Section 1.1 below, to C. K. Cooper & Company, Inc. (“Holder”), as of the Date of Issuance indicated above. The amount and kind of securities obtainable pursuant to the rights granted hereunder and the exercise price for such securities are subject to adjustment pursuant to the provisions contained in this Warrant.

     This Warrant is subject to the following provisions:

     1. Exercise of Warrant.

          1.1 Purchase of Shares. Subject to the terms and conditions hereinafter set forth, Holder is entitled, upon surrender of this Warrant at the principal office of the Company (or at such other place as the Company shall notify Holder in writing), to purchase from the Company up to ___________ (_________________) shares of the Company’s Common Stock (the “Warrant Shares”) for $________ per share (the “Exercise Price”).

          1.2 Exercise Period. Holder may exercise this Warrant for a period (“Exercise Period”) commencing on the date hereof and terminating on the third anniversary of the Date of Issuance. Notwithstanding anything herein to the contrary, in the event Holder has not exercised this Warrant in full prior to the expiration of the exercise period, this Warrant shall be deemed automatically exercised with payment for the then unexercised Warrant Shares being made pursuant to Section 1.4 on the date immediately preceding such expiration date without any further action on behalf of the Holder.

          1.3 Exercise Procedure.

               (a) This Warrant shall be deemed to have been exercised at such time when the Company has received all of the following items (the “Exercise Time”):

                    (i) a completed Exercise Notice, as described in Section 1.6, executed by Holder exercising all or part of the purchase rights represented by this Warrant;

                    (ii) this Warrant; and

                    (iii) payment to the Company of an amount equal to the Exercise Price multiplied by the number of Warrant Shares being purchased, at the election of Holder, by wire transfer or certified check payable to the order of the Company, except in cases where the Holder indicates in the Exercise Notice that it intends to exercise this Warrant with payment for the then unexercised Warrant Shares being made in the manner specified in Section 1.4 or Section 1.5. The person or persons in whose name(s) any certificate(s) representing Warrant Shares shall be issuable, upon exercise of this Warrant, shall be deemed to have become the holders(s) of record of, and shall be treated for all purposes as the record holder(s) of, the Warrant Shares represented.

               (b) Certificates for Warrant Shares purchased upon exercise of this Warrant shall be delivered by the Company to Holder as soon as practicable after the Exercise Time. Unless this Warrant has expired or all of the purchase rights represented hereby have been exercised, the Company shall prepare a new Warrant, substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and shall as soon as practicable deliver such new Warrant to the person designated for delivery in the Exercise Notice.

               (c) The Warrant Shares issuable upon the exercise of this Warrant shall be deemed to have been issued to Holder at the Exercise Time, and Holder shall be deemed for all purposes to have become the record holder of such Common Stock at the Exercise Time.

               (d) The issuance of certificates for Warrant Shares upon exercise of this Warrant shall be made without charge to Holder for any issuance tax in respect thereof or other cost incurred by the Company in connection with such exercise and the related issuance of Warrant Shares (other than any transfer taxes resulting from the issuance of Warrant Shares to any person other than Holder).

               (e) The Company shall not close its books against the transfer of this Warrant or of any Warrant Shares issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant.

               (f) During the Exercise Period, the Company shall reserve and keep available out of its authorized but unissued Common Stock such number of Warrant Shares issuable upon the full exercise of this Warrant. All Warrant Shares which are so issuable shall, when issued and upon the payment of the applicable Exercise Price, be duly and validly issued, fully paid and nonassessable and free from all taxes, liens and charges and not subject to the pre-emptive rights of any holder of Common Stock or any other class or series of stock of the Company. During the Exercise Period, the Company shall not take any action which would cause the number of authorized but unissued Common Stock to be less than the number of such shares required to be reserved hereunder for issuance upon exercise of this Warrant.

          1.4 Cashless Exercise. Notwithstanding the provisions of Section 1.3(a)(iii) requiring payment by wire transfer or certified check, the Company agrees that, unless otherwise prohibited by law, Holder shall have the right at any time and from time to time to exercise this Warrant in full or in part on a cashless basis, computed using the following formula:

2

X =	Y (A — B)
	A

Where:

X = The number of Warrant Shares to be issued to the Holder pursuant to this cashless exercise;

Y = The number of Warrant Shares in respect of which the net issue election is made;

A = The Fair Market Value (as defined below) of one Warrant Share at the time the cashless exercise election is made; and

B = The Exercise Price (as adjusted to the date of the cashless exercise).

The term “Fair Market Value” shall mean (A) if the class of Warrant Shares is exchange-traded, the closing sale or last sale price per share of the class of Warrant Shares, (B) if the class of Warrant Shares is regularly traded in any over-the-counter market, the average of the bid and asked prices per share of the class of Warrant Shares, and (C) if the class of Warrant Shares is not traded as described in clause (A) or (B), the per share fair market value of the class of Warrant Shares as determined in good faith by the Company’s Board of Directors. Fair Market Value as of a given date with respect to clauses (A) and (B) shall be determined as of the close of business on the day prior to the date of determination, or if no trading in the class of Warrant Shares takes place on such date, on the next preceding trading day on which there has been such trading.

          1.5 “Easy Sale” Exercise. In lieu of the payment methods set forth above, when permitted by law and applicable regulations, the Holder may pay the Exercise Price through a “same day sale” commitment from the Holder (and if applicable a broker-dealer that is a member of the Financial Industry Regulatory Authority (a “FINRA Dealer”)), whereby the Holder irrevocably elects to exercise this Warrant and to sell at least that number of Warrant Shares so purchased to pay for the Exercise Price (and up to all of the Warrant Shares so purchased) and the Holder (or, if applicable, the FINRA Dealer) commits upon sale (or, in the case of the FINRA Dealer, upon receipt) of such Warrant Shares to forward the Exercise Price directly to the Company, with any sale proceeds in excess of the Exercise Price being for the benefit of the Holder.

          1.6 Exercise Notice. Upon any exercise of this Warrant, Holder shall deliver to the Company an Exercise Notice in substantially the form set forth in Exhibit A hereto.

          1.7 No Fractional Shares. If a fractional share of Warrant Shares would, but for the provisions of this Section 1.7, be issuable upon exercise of the rights represented by this Warrant, the Company shall (i) round a half share or greater to be delivered to Holder up to the next whole share and shall round a less-than-half share to be delivered to Holder down to the nearest whole share.

     2. Adjustments to Warrant Shares.

          2.1 Capital Reorganizations and Other Reclassifications. In case of any capital reorganization of the Company, or of any reclassification of the Common Stock, or in case of the consolidation of the Company with, or the merger of the Company with, or merger of the Company into, any other corporation (other than a consolidation or merger which does not result in any

3

reclassification or change of the outstanding Common Stock) or of the sale of the properties and assets of the Company as, or substantially as, an entirety to any other corporation or entity, this Warrant shall, after such capital reorganization, reclassification of the Common Stock, consolidation, merger, or sale, be exercisable, upon the terms and conditions specified in this Warrant, for the kind, amount and number of shares or other securities, assets, or cash to which a holder of the number of shares of Common Stock purchasable (at the time of such capital reorganization, reclassification of the Common Stock, consolidation, merger or sale) upon exercise of such Warrant would have been entitled to receive upon such capital reorganization, reclassification of the Common Stock, consolidation, merger, or sale; and in any such case, if necessary, the provisions set forth in this Section 2.1 with respect to the rights and interests thereafter of Holder shall be appropriately adjusted so as to be applicable, as nearly equivalent as possible, to any shares or other securities, assets, or cash thereafter deliverable on the exercise of this Warrant. The Company shall not effect any such consolidation, merger, or sale, unless prior to or simultaneously with the consummation thereof the successor corporation or entity (if other than the Company) resulting from such consolidation or merger or the corporation or entity purchasing such assets or other appropriate corporation or entity shall assume, by written instrument, the obligation to deliver to Holder such shares, securities, assets, or cash as, in accordance with the foregoing provisions, such holders may be entitled to purchase and other obligations hereunder.

          2.2 Notice of Record Date, etc. In the event the Company shall propose to take any action of the types requiring an adjustment pursuant to this Section 2.1 or a dissolution, liquidation or winding up of the Company shall be proposed, the Company shall give notice to Holder as provided in Section 8, which notice shall specify the record date, if any, with respect to any such action and the date on which such action is to take place. Such notice shall also set forth such facts with respect thereto as shall be reasonably necessary to indicate the effect of such action (to the extent such effect may be known at the date of such notice) on the Exercise Price and the number, kind or class of shares or other securities or property which shall be deliverable or purchasable upon the occurrence of such action or deliverable upon the exercise of the Warrants. In the case of any action which will require the fixing of a record date, unless otherwise provided in this Warrant, such notice shall be given at least twenty (20) days prior to the date so fixed, and in case of all other action, such notice shall be given at least thirty (30) days prior to the taking of such proposed action.

     3. No Voting Rights. This Warrant shall not entitle Holder to any voting rights or other rights as a stockholder of the Company.

     4. Transfer of Warrant. The securities represented hereby and the Warrant Shares issuable upon exercise hereof have not been registered under the Securities Act and may not be offered, sold or otherwise transferred, pledged or hypothecated in the absence of an effective registration statement under the Securities Act with respect to such securities or delivery of an opinion of counsel in form and substance reasonably satisfactory to the Company that such registration is not required. Each certificate representing a Warrant Share shall bear a legend to such effect. In no case shall Warrant be sold, transferred, pledged, hypothecated or assigned for a period of 180-days following the effective date of the offering pursuant to Rule 2710(g)(1) of the FINRA Conduct Rules.

     5. Representations and Warranties of the Company. The Company represents and warrants to Holder as follows:

4

          (a) This Warrant has been duly authorized and executed by the Company and is a valid and binding obligation of the Company enforceable in accordance with its terms; and

          (b) The Warrant Shares, when issued in accordance with the terms hereof, will be validly issued, fully paid and nonassessable.

     6. Representations and Warranties by Holder. Holder represents and warrants to the Company as follows:

          (a) This Warrant is being acquired for its own account, for investment and not with a view to, or for resale in connection with, any distribution or public offering thereof within the meaning of the Securities Act. Upon exercise of this Warrant, Holder shall, if so requested by the Company, confirm in writing, in a form reasonably satisfactory to the Company, that the Warrant Shares issuable upon exercise of this Warrant are being acquired for investment and not with a view toward distribution or resale;

          (b) Holder understands that this Warrant and the Warrant Shares have not been registered under the Securities Act by reason of their issuance in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act pursuant to Section 4(2) thereof and that this Warrant and the Warrant Shares may be resold without registration under the Securities Act only in certain limited circumstances;

          (c) Holder has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the purchase of this Warrant and the Warrant Shares purchasable pursuant to the terms of this Warrant and of protecting its interest in connection therewith;

          (d) The Holder has been afforded the opportunity to ask questions of, and to receive answers from, Company representatives concerning the terms and conditions of the offering, the Company and any other relevant information and to obtain all additional information necessary to verify the accuracy of other information made available to the Holder or to otherwise make an informed investment decision. The Holder has been granted full and unrestricted access to the books and records of the Company and was permitted to examine the foregoing, to question Company representatives and to make all other investigations that the Holder considered appropriate to determine or verify the business or condition (financial or otherwise) of the Company. The Holder acknowledges that the Company has furnished the Holder all available information concerning the business and affairs of the Company that the Holder reasonably requested, and that the Holder has availed itself of the aforementioned opportunity to the extent it considers appropriate in order to permit it to evaluate the merits and risks of the proposed investment.

          (e) Holder is able to bear the economic risk of the purchase of the Warrant Shares pursuant to the terms of this Warrant; and

          (f) Holder is an accredited investor within the meaning of Regulation D promulgated under the Securities Act.

     7. Replacement. Upon receipt of evidence reasonably satisfactory to the Company (an affidavit of Holder shall be satisfactory) of the ownership and the loss, theft, destruction or mutilation of this Warrant, and in the case of any such loss, theft or destruction, upon receipt of indemnity

5

reasonably satisfactory to the Company or, in the case of any such mutilation upon surrender of such Warrant, the Company shall execute and deliver in lieu of such Warrant a new Warrant of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate.

     8. Notices. Except as otherwise expressly provided herein, all notices and deliveries referred to in this Warrant shall be in writing and shall be delivered personally, sent by reputable overnight courier service (charges prepaid) or sent by registered or certified mail, return receipt requested, postage prepaid and shall be deemed to have been given when so delivered (or when received, if delivered by any other method) if sent (i) to the Company, at its principal executive offices and (ii) to Holder, at Holder’s address as it appears in the records of the Company.

     9. Amendment and Waiver. The provisions of this Warrant contain the entire understanding between the parties hereto with respect to the subject matter hereof and may be amended and waived only if such amendment or waiver is set forth in writing executed by the Company and the Holder.

     10. Descriptive Headings; Governing Law. The descriptive headings of the several Sections of this Warrant are inserted for convenience only and do not constitute a part of this Warrant. This Warrant shall be governed by the laws of the State of New York.

     11. Benefits of Agreement; Successors. This Warrant shall be binding and inure to the benefit of the parties and their respective successors and assigns hereunder; provided that this Warrant may be assigned by Holder only in compliance with the conditions specified in and in accordance with all of the terms of this Warrant. This Warrant does not create and shall not be construed as creating any rights enforceable by any other person or corporation.

     12. Severability. If any provision of this Warrant shall be held to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions of this Warrant.

     13. Counterparts. This Warrant may be executed in any number of counterparts and each such counterpart shall for all purposes be deemed an original, and such counterparts shall together constitute but one and the same instrument.

6

     IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested by its duly authorized officers and to be dated the Date of Issuance hereof.

ENERJEX RESOURCES, INC.

By:

Name:

Title:

C. K. COOPER & COMPANY, INC.

By:

Name:

Title:

7

EXHIBIT A

EXERCISE NOTICE

ENERJEX RESOURCES, INC.
Attention: Chief Financial Officer

     The undersigned hereby elects to purchase, pursuant to the provisions of the Common Stock Warrant issued by EnerJex Resources, Inc. and held by the undersigned, the original of which is attached hereto, and (check the applicable box):

o   Tenders herewith payment of the exercise price in full in the form of cash or certified check in the amount of $___for ___ such securities.

o   Elects the Net Issue Exercise option pursuant to Section 1.4 of the Warrant, and accordingly requests delivery of a net of ___of such securities, according to the following calculation:

X = Y (A-B)( ) = (____) [(_____) — (_____)]

A (___)

Where X = the number of shares of Common Stock to be issued to Holder.

Y = the number of shares of Common Stock purchasable under the amount of the Warrant being exchanged (as adjusted to the date of such calculation).

A = the Fair Market Value of one share of the Company’s Common Stock.

B = Exercise Price (as adjusted to the date of such calculation).

o   Elects the Easy Sale Exercise option pursuant to Section 1.5 of the Warrant, and accordingly requests delivery of a net of ___of such securities.

The undersigned hereby represents and warrants that the undersigned is acquiring such shares for its own account for investment purposes only, and not for resale or with a view to distribution of such shares or any part thereof.

HOLDER:

Name:

Title:

Date:

Address:

A-1

     Name in which shares should be registered:

o If this box is checked, as long as the Company’s transfer agent participates in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer program (“FAST”), and except as otherwise provided in the next following sentence, the Company shall effect delivery of the shares of Common Stock to the Holder by crediting to the account of the Holder or its nominee at DTC (as specified in this Exercise Notice) with the number of shares of Common Stock required to be delivered. In the event that the Company’s transfer agent is not a participant in FAST, or if the shares of Common Stock are not otherwise eligible for delivery through FAST, the Company shall effect delivery of the shares of Common Stock by delivering to Holder or its nominee physical certificates representing such shares.

A-2

EX-5.1

Exhibit 5.1

4801 MAIN STREET, SUITE 1000 · KANSAS CITY, MO 64112
816.983.8000 FAX 816.983.8080 ·
www.huschblackwell.com

September 2, 2008

EnerJex Resources, Inc.
7300 W. 110^th Street, 7^th Floor
Overland Park, KS 66210

Ladies and Gentlemen:

     As counsel for EnerJex Resources, Inc., a Nevada corporation (the “Company”), we have been requested to render this opinion in connection with the preparation and filing of a Registration Statement on Form S-1, as amended (the “Registration Statement”), with the Securities and Exchange Commission (the “Commission”) for the purposes of registering under the Securities Act of 1933, as amended (the “Securities Act”), shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”).

     We have examined the Company’s Registration Statement and such other documents as we have deemed necessary or appropriate in order to express these opinions.

     In our examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified, conformed, photostatic or facsimile copies and the authenticity of the originals of such latter documents. In making our examination of executed documents, we have assumed that the parties thereto, other than the Company, its directors and officers, had the power, corporate or otherwise, to enter into and perform all obligations thereunder and have also assumed the due authorization by all requisite action, corporate or otherwise, and execution and delivery by such parties of such documents and the validity and binding effect thereof on such parties. As to any facts material to the opinions expressed herein that were not independently established or verified, we have relied upon oral or written statements and representations of officers and other representatives of the Company and others. With respect to the actions to be taken subsequent to the date hereof by the Board of Directors of the Company (the “Board”) or an authorized committee thereof, we have assumed that such actions will be taken at duly called meetings with a quorum of directors or committee members, as the case may be, present and acting throughout, or by unanimous written consent of all directors or committee members, as the case may be. We have assumed that the form of certificate or other instrument or document to be issued after the date hereof representing the Common Stock to be issued under the Registration Statement will conform in all respects to the requirements applicable under the Nevada Revised Statutes (the “NRS”)

     We do not express any opinion as to any laws other than the NRS. Insofar as the opinions expressed herein relate to matters governed by laws other than the NRS, we have assumed, without having made any independent investigation, that such laws do not affect any of the opinions set forth herein.

KANSAS CITY, MISSOURI • ST. LOUIS, MISSOURI • OVERLAND PARK, KANSAS • OMAHA, NEBRASKA
SPRINGFIELD, MISSOURI • EDWARDSVILLE, ILLINOIS • WASHINGTON, D.C. • LONDON, UNITED KINGDOM

AFFILIATES: LEEDS • MANCHESTER • MEXICO CITY • MONTREAL • TORONTO • VANCOUVER

EnerJex Resources, Inc.
September 2, 2008
Page 2

     Based upon and subject to the foregoing and to the other qualifications and limitations set forth herein, we are of the opinion that:

     With respect to the shares of Common Stock, upon (i) the Board or an authorized committee thereof having duly authorized a designated number of shares of Common Stock for issuance at a minimum price or value of consideration to be set by the Board or an authorized committee thereof (such consideration to be not less than the par value per share), and (ii) such shares of Common Stock having been issued and delivered against payment of the consideration therefore as set by the Board or an authorized committee thereof, such shares of Common Stock will be validly issued, fully paid and non-assessable.

     We hereby consent to the filing of this opinion with the Commission as an exhibit to the Registration Statement. We also hereby consent to the use of our name under the heading “Legal Matters” in the prospectus which forms a part of the Registration Statement. In giving this consent, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder. This opinion is expressed as of the date hereof and we disclaim nay undertaking to advise you of any subsequent changes in the facts stated or assumed herein or of any subsequent changes in applicable laws.

Very truly yours,
 

/s/ Husch Blackwell Sanders LLP  

EX-21.1

Exhibit 21.1

Subsidiaries of EnerJex Resources, Inc.

Name of Subsidiary	State of Incorporation	Percentage Ownership
EnerJex Kansas, Inc.	Nevada	100%
DD Energy, Inc.	Nevada	100%

EX-23.1

Exhibit 23.1

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM’S CONSENT

We consent to the use in this Registration Statement on Form S-1 of our report dated June 23, 2008 with respect to financial statements of EnerJex Resources, Inc. for the years ended March 31, 2008 and March 31, 2007, filed with the Securities and Exchange Commission. We also consent to the reference to us under the heading “Experts” in each of the Registration Statement and the Prospectus to which the Registration Statement relates.

/s/ Weaver & Martin LLC

Weaver & Martin LLC
Kansas City, Missouri

September 3, 2008