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<SEC-DOCUMENT>0001001614-08-000033.txt : 20080425
<SEC-HEADER>0001001614-08-000033.hdr.sgml : 20080425
<ACCEPTANCE-DATETIME>20080425150532
ACCESSION NUMBER:		0001001614-08-000033
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20080425
FILED AS OF DATE:		20080425
DATE AS OF CHANGE:		20080425
EFFECTIVENESS DATE:		20080425

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			TENGASCO INC
		CENTRAL INDEX KEY:			0001001614
		STANDARD INDUSTRIAL CLASSIFICATION:	CRUDE PETROLEUM & NATURAL GAS [1311]
		IRS NUMBER:				870267438
		STATE OF INCORPORATION:			TN
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-15555
		FILM NUMBER:		08777415

	BUSINESS ADDRESS:	
		STREET 1:		10215 TECHNOLOGY DRIVE
		STREET 2:		SUITE 301
		CITY:			KNOXVILLE
		STATE:			TN
		ZIP:			37932
		BUSINESS PHONE:		865-675-1554

	MAIL ADDRESS:	
		STREET 1:		10215 TECHNOLOGY DRIVE
		STREET 2:		SUITE 301
		CITY:			KNOXVILLE
		STATE:			TN
		ZIP:			37932
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>proxy2008coomplete.htm
<DESCRIPTION>PROXY STATEMENT APRIL 25, 2008
<TEXT>
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        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b><font style="FONT-FAMILY: 'DUTCH 801'">SCHEDULE 14A INFORMATION&nbsp;</font></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b><font style="FONT-FAMILY: 'DUTCH 801'">PROXY STATEMENT PURSUANT TO SECTION 14(a)<br>
         OF THE SECURITIES EXCHANGE ACT OF 1934<br>
        &nbsp;</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">Filed by the Registrant /X/<br>
        &nbsp;<br>
         Filed by a Party other than the Registrant / /<br>
        &nbsp;<br>
         Check the Appropriate Box:</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">/ /Preliminary Proxy
        Statement<br>
        / /Confidential for Use of Commission Only<br>
        /x /Definitive Proxy Statement<br>
        / /Definitive Additional Materials<br>
        / /Soliciting Materials Pursuant to &sect;240.14a-11(c) or &sect;240.14a-12<br>
        &nbsp;<br>
         &nbsp;</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b><u><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">____________________________
        TENGASCO, INC. ______________________________________________</font></u></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">(Name of Registrant as Specified
        in its Charter)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>

         &nbsp;<br>
         _____________________________________________________________________________________________</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">(Name of person(s) Filing Proxy
        Statement if other than Registrant)</font></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">Payment of Filing Fee (Check the
        appropriate box)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">/x / No Fee
        Required&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>

         / / $125 per Exchange Act Rules-O-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or Item 22(a)(2)
        of Schedule 14A.<br>
        / / Fee computed on table below per Exchange Act Rules14A-6(i)(4) and O-11.<br>
        &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></b>
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">1) Title of each class of
        securities to which each transaction applies:<br>
        &nbsp;<br>
         ________________________________________________________________________________________<br>

        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2) Aggregate number of securities to which transaction
        applies:<br>
        &nbsp;<br>
         _________________________________________________________________________________________&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>

         &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3) Per unit price or other underlying value of transaction
        computed pursuant to Exchange Act Rule O-11 (Set forth the amount on which the filing fee
        is calculated and state how it was determined)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">________________________________________________________________________________________<br>

        &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4) Proposed maximum aggregate value of transaction.<br>
        &nbsp;<br>
         ________________________________________________________________________________________<br>

        &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5) Total fee paid.<br>
        &nbsp;<br>
         _________________________________________________________________________________________</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">/ / Fee paid previously by
        written preliminary materials.<br>
        / / check box if any part of the fee is offset as provided by Exhange Act Rule O-11(a)(2)
        and identify the filing for which the offsetting fee was paid previously. Identify the
        previous filing by registration statement number, or the Form or Schedule and the date of
        its filing.<br>
        1) Amount Previously Paid</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">2) Form Schedule or Registration
        Statement
        No.:</font></b><b><u><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'"></font></u></b><br>

        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">3) Filing Party:</font></b><br>
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">4) Date Filed:</font></b>
        <b><font style="FONT-SIZE: 9pt; FONT-FAMILY: 'DUTCH 801'">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></b></p>

        <p></p>
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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>TENGASCO, INC.<br>
        10215 TECHNOLOGY DRIVE N.W.<br>
        KNOXVILLE, TENNESSEE 37932</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>NOTICE OF ANNUAL MEETING OF STOCKHOLDERS<br>
        TO BE HELD ON<br>
        June 2, 2008</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        TO THE STOCKHOLDERS:<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notice is hereby given that the 2008 annual meeting of
        stockholders (the "Annual Meeting") of Tengasco, Inc. (the "Company") has been called for
        and will be held at the Homewood Suites by Hilton, 10935 Turkey Drive, Knoxville, Tennessee
        37922 at 9:00 A.M., local time, on Monday, June 2, 2008 for the following purposes:<br>
        &nbsp;<br>
        </p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-INDENT: 36px; TEXT-ALIGN: justify">
        <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font> To
        elect Jeffrey R. Bailey, Matthew K. Behrent, John A. Clendening, Carlos P. Salas and Peter
        E. Salas to the Board of Directors to hold office until their successors shall have been
        elected and qualify;</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To approve amendments to the Tengasco, Inc. Stock Incentive
        Plan to (i) increase the number of shares of common stock that may be issued under the Plan
        by 3,500,000 shares and (ii) extend the term of the Plan for an additional ten years;</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        3. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To ratify the appointment by the Audit Committee of the
        Board of Directors of Rodefer Moss &amp; Co, PLLC to serve as the independent certified
        public accountants for the current fiscal year; and</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To consider and transact
        such other business as may properly come before the Annual Meeting or any adjournments
        thereof.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has fixed the close of business on
        April 10, 2008 as the record date for the determination of the stockholders entitled to
        receive notice and to vote at the Annual Meeting or any adjournments thereof. The list of
        stockholders entitled to vote at the Annual Meeting will be available for examination by
        any stockholder at the Company's offices at 10215 Technology Drive N.W., Suite 301,
        Knoxville, Tennessee 37932, for ten (10) days prior to June 2, 2008.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;By
        Order of the Board of Directors<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jeffrey
        R. Bailey, <i>Chief Executive Officer</i><br>
        Dated: April 25, 2008</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE
        FILL IN, SIGN AND DATE THE PROXY SUBMITTED HEREWITH AND RETURN IT IN THE ENCLOSED STAMPED
        ENVELOPE. THE GRANTING OF SUCH PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE SUCH PROXY IN
        PERSON SHOULD YOU LATER DECIDE TO ATTEND THE MEETING. THE ENCLOSED PROXY IS BEING SOLICITED
        BY THE BOARD OF DIRECTORS.<br>
        </b></p>
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        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>TENGASCO, INC.</b></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>PROXY STATEMENT</b><br>
        &nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>GENERAL</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This proxy statement is furnished by the Board of Directors
        of Tengasco, Inc., a Tennessee corporation (sometimes the "Company" or "Tengasco"), with
        offices located at 10215 Technology Drive, N.W., Suite 301, Knoxville, Tennessee 37932, in
        connection with the solicitation of proxies to be used at the annual meeting of
        stockholders of the Company to be held on June 2, 2008 and at any adjournments thereof (the
        "Annual Meeting"). This proxy statement will be mailed to stockholders beginning
        approximately April 25, 2008.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You may vote in person at the Annual Meeting or you may vote
        by proxy. We recommend that you vote by proxy even if you plan to attend the Annual
        Meeting. If your share ownership is recorded directly, you will receive a proxy card.
        Voting instructions are included on the proxy card. If your share ownership is beneficial
        (that is, your shares are held in the name of a bank, broker or other nominee referred to
        as in &ldquo;street name&rdquo;), your broker will issue you a voting instruction form that
        you use to instruct them how to vote your shares. Your broker must follow your voting
        instructions. Although most brokers and nominees offer mail, telephone and internet voting,
        availability and specific procedures will depend on their voting arrangements.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If a proxy is properly executed and returned, the shares
        represented thereby will be voted as instructed on the proxy. Any proxy may be revoked by a
        stockholder prior to its exercise upon written notice to the Chief Executive Officer of the
        Company, or by a stockholder voting in person at the Annual Meeting. Unless instructions to
        the contrary are indicated, proxies will be voted FOR the election of the directors named
        therein, FOR the approval of amendments to the Tengasco, Inc. Stock Incentive Plan to (i)
        increase the number of shares of common stock that may be issued under the Plan by
        3,500,000 shares and (ii) extend the term of the Plan for an additional ten years from
        October 24, 2010 to October 24, 2020 and FOR the ratification of the selection by the Audit
        Committee of the Board of Directors of Rodefer Moss &amp; Co, PLLC, as the independent
        certified public accountants of the Company.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A copy of the Company&rsquo;s Annual Report on Form 10-K of
        the Company for the fiscal year ended December 31, 2007 ("Fiscal 2007"), which contains
        financial statements audited by the Company's independent certified public accountants
        accompanies this proxy statement.<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The cost of preparing, assembling and mailing this notice of
        meeting, proxy statement, the enclosed Annual Report on Form 10-K and proxy will be borne
        by the Company. In addition to solicitation of the proxies by use of the mails, some of the
        officers and regular employees of the Company, without extra remuneration, may solicit
        proxies personally or by telephone, fax transmission or e-mail. The Company may also
        request brokerage houses, nominees, custodians and fiduciaries to forward soliciting
        material to the beneficial owners of the common stock. The Company will reimburse such
        persons for their expenses in forwarding soliciting material.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>VOTING SECURITIES</b> <b>AND<br>
        PRINCIPAL HOLDERS</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has fixed the close of business on
        April 10, 2008 as the record date (the "Record Date") for the determination of stockholders
        entitled to notice of, and to vote at the Annual Meeting. Only stockholders on the Record
        Date will be able to vote at the Annual Meeting.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of the Record Date, 59,158,750 shares of the Company's
        common stock, $.001 par value per share are outstanding, and each share will be entitled to
        one (1) vote, with no shares having cumulative voting rights. Holders of shares of common
        stock are entitled to vote on all matters. Unless otherwise indicated herein, a majority of
        the votes represented by shares present or represented at the Annual Meeting is required
        for approval of each matter that will be submitted to the stockholders.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management knows of no business other than that specified in
        Items 1, 2 and 3 of the Notice of Annual Meeting that will be presented for consideration
        at the Annual Meeting. If any other matter is properly presented, it is the intention of
        the persons named in the enclosed proxy to vote in accordance with their best judgment.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth the share holdings of those
        persons who own more than 5% of the Company's common stock as of April 10, 2008 with these
        computations being based upon 59,158,750 shares of common stock being outstanding as of
        that date and as to each shareholder, as it may pertain, assumes the exercise of options or
        warrants granted or held by such shareholder as of April 10, 2008.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b><u>Five Percent Stockholders</u></b><b><u><sup>1</sup></u></b></p>

        <p></p>

        <p></p>

        <table cellspacing="0" cellpadding="0" width="600" border="0">
            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="187">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 11pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <b>Name and Address</b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="108">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u><font style="FONT-SIZE: 11pt">Title</font></u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="168">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <b><font style="FONT-SIZE: 11pt">Number of Shares</font></b></p>

                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <b><u><font style="FONT-SIZE: 11pt">Beneficially Owned</font></u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 11pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="left">
                    <b><u>Percent of Class</u></b></p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="187">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 11pt">Dolphin Offshore<br>
                     Partners, L.P.<br>
                    c/o Dolphin Asset<br>
                     Management Corp.</font></p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 11pt">PO Box 16867<br>
                    Fernandina, FL 32035</font></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="108">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 11pt">Stockholder</font></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="168">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 11pt">21,107,492</font><sup><font style="FONT-SIZE: 11pt">
                    2</font></sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 11pt">35.6%</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>


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        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>PROPOSAL NO. 1:<br>
        &nbsp;<br>
         ELECTION OF DIRECTORS</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>GENERAL</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Article III, paragraph number 2 of the Company's Bylaws
        provides that the number of directors of the Company shall be a minimum of three and a
        maximum of ten. The members of the Board of Directors are each elected for a one-year term
        or until their successors are elected and qualify with a plurality of votes cast in favor
        of their election. Five nominees are put forth before the stockholders for election to the
        Board of Directors at the Annual Meeting. All of the nominees are presently directors of
        the Company and Mr. Jeffrey R. Bailey, one of the director-nominees is also presently the
        Chief Executive Officer of the Company.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The directors will serve until the next annual meeting of
        stockholders and thereafter until their successors shall have been elected and
        qualified.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless authority is withheld, the proxies in the accompanying
        form will be voted in favor of the election of the nominees named above as directors. If
        any nominee should subsequently become unavailable for election, the persons voting the
        accompanying proxy may in their discretion vote for a substitute.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>BOARD OF DIRECTORS</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has the responsibility for
        establishing broad corporate policies and for the overall performance of the Company.
        Although only one member of the Board is involved in day-to-day operating details, the
        other members of the Board are kept informed of the Company's business by various reports
        and documents sent to them as well as by operating and financial reports made at Board
        meetings. The Board of Directors held seven meetings in Fiscal 2007. All directors who are
        up for re-election attended at least 75% of the aggregate number of meetings of the Board
        of Directors and of the committees on which such directors served during Fiscal 2007.
        Although it has no formal policy requiring attendance, the Company encourages all of its
        directors to attend the annual meeting of stockholders. All of the Company&rsquo;s
        directors attended last year&rsquo;s annual meeting and it is anticipated that all of the
        director-nominees will attend this year&rsquo;s Annual Meeting.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There is no understanding or arrangement between any director
        or any other persons pursuant to which such individual was or is to be selected as a
        director or nominee of the Company.<br>
        </p>
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        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        <b><u>Identification of Director-Nominees</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth the names of all current
        director-nominees.<br>
        &nbsp;</p>

        <p></p>

        <table cellspacing="0" cellpadding="0" width="600" border="0">
            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u>Name</u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="194">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u>Positions Held</u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <b>Date of Initial Election<br>
                    </b><b><u>or Designation</u></b></p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Jeffrey R. Bailey<br>
                    2306 West Gallaher Ferry<br>
                    Knoxville, TN 37932<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="194">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director;<br>
                    Chief Executive Officer</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    2/28/03-8/11/04; 10/21/04<br>
                    7/17/02</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Matthew K. Behrent<br>
                    c/o EDC LLC<br>
                    825 Eighth Avenue,<br>
                    23<sup>d</sup> Floor<br>
                    New York, NY 10019<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="194">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    3/27/07</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    John A. Clendening<br>
                    1031 Saint Johns Drive<br>
                    Maryville, TN 37801<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="194">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    2/28/03</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Carlos P. Salas<br>
                    c/o Dolphin Asset<br>
                    Management Corp.<br>
                    129 East 17<sup>th</sup> Street<br>
                    New York, NY 10003<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="194">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    8/12/04</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Peter E. Salas</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    c/o Dolphin Management Inc.<br>
                    PO Box 16867<br>
                    Fernandina, FL 32035</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="194">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director;<br>
                    Chairman of the Board</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    10/8/02<br>
                    10/21/04</p>
                </td>
            </tr>
        </table>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b> <b><u>Background of Directors</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is a brief account of the experience, for at
        least the past five (5) years, of each nominee for director.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jeffrey R. Bailey is 50 years old. He graduated in 1980 from
        New Mexico Institute of Mining and Technology with a B.S. degree in Geological Engineering.
        Upon graduation he joined Gearhart Industries as a field engineer working in Texas, New
        Mexico, Kansas, Oklahoma and Arkansas. Gearhart Industries later merged with Halliburton
        Company. In 1993 after 13 years working in various field operations and management roles
        primarily focused on reservoir evaluation, log analysis and log data acquisition he assumed
        a global role with Halliburton as a petrophysics instructor in Fort Worth, Texas. His
        duties were to teach Halliburton personnel and customers around the world log analysis and
        competition technology and to review analytical reservoir problems. In this role Mr. Bailey
        had the opportunity to review reservoirs in Europe, Latin America, Asia Pacific and the
        Middle East developing a special expertise in carbonate reservoirs. In 1997 he became
        technical manager for Halliburton in Mexico focusing on finding engineering solutions to
        the production challenges of large carbonate reservoirs in Mexico. He joined the Company as
        its Chief Geological Engineer on March 1, 2002. He was elected as President of the Company
        on July 17, 2002 and is presently the Company&rsquo;s Chief Executive Officer. He was
        elected as a Director on February 28, 2003 and served as a Director until August 11, 2004.
        He was again elected to the Company&rsquo;s Board of Directors on October 21, 2004.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Matthew K. Behrent is 37 years old. He currently is an
        Executive Vice President, Corporate Development a t Entertainment Distribution Company, Inc
        (NasdaqNM: EDCI ), a company engaged in the manufacture and distribution of CD's and DVD's
        primarily for Universal Music. Before joining EDCI in June, 2005 , Mr. Behrent was an
        investment banker, working as a Vice-President at Revolution Partners, a technology focused
        investment bank in Boston, from March 2004 until June 2005 and as an associate in Credit
        Suisse First Boston Corporation's technology mergers and acquisitions group from June 2000
        until January 2003. From June 1998 to May 2000, Mr. Behrent practiced law with Cleary,
        Gottlieb, Steen &amp; Hamilton in New York, advising financial sponsors and corporate
        clients in connection with financings and mergers and acquisitions transactions. Mr.
        Behrent received his J.D. from Stanford Law School in 1997, and his B.A. in Political
        Science and Political Theory from Hampshire College in 1992. He became a Director of the
        Company on March 27, 2007.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dr. John A. Clendening is 76 years old. He received B.S.
        (1958), M.S. (1960) and Ph. D. (1970) degrees in geology from West Virginia University. He
        was employed as a Palynologist-Coal Geologist at the West Virginia Geological Survey from
        1960 until 1968. He joined Amoco in 1968 and remained with Amoco as a senior geological
        associate until 1992. Dr. Clendening has served as President and other offices of the
        American Association of Stratigraphic Palynologists and the Society of Organic
        Petrologists. From 1992-1998 he was engaged in association with Laird Exploration Co., Inc.
        of Houston, Texas, directing exploration and production in south central Kentucky. In 1999
        he purchased all the assets of Laird Exploration in south central Kentucky and operates
        independently. While with Amoco Dr. Clendening was instrumental in Amoco's acquisition in
        the early 1970's of large land acreage holdings in Northeast Tennessee, based upon his
        geological studies and recommendations. His work led directly to the discovery of what is
        now the Company&rsquo;s Paul Reed # 1 well. He further recognized the area to have
        significant oil and gas potential and is credited with discovery of the field that is now
        known as the Company's Swan Creek Field. Dr. Clendening previously served as a Director of
        the Company from September 1998 to August 2000. He was again elected as a Director of the
        Company on February 28, 2003.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Carlos P. Salas is 36 years old. He is a principal of Dolphin
        Advisors, L.L.C., which manages a private-equity investment fund focused on middle-market
        opportunities. Before joining Dolphin Advisors, Mr. Salas led corporate finance and mergers
        and acquisitions advisory assignments for middle-market clients as an investment banker
        with Donaldson, Lufkin &amp; Jenrette ("DLJ") in Los Angeles and later with Credit Suisse
        First Boston Corporation when the latter acquired DLJ. Prior to joining DLJ in 1999, Mr.
        Salas practiced law with Cleary, Gottlieb, Steen &amp; Hamilton in New York, advising
        financial sponsors and corporate clients in connection with financings and cross-border
        mergers and acquisitions transactions. Mr. Salas received his J.D. from The University of
        Chicago and his B.A. in Philosophy from New York University. He was elected to the
        Company&rsquo;s Board of Directors on August 12, 2004. Mr. Salas also serves on the board
        of William Controls, Inc.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Peter E. Salas is 53 years old. He has been President of
        Dolphin Asset Management Corp. and its related companies since he founded it in 1988. Prior
        to establishing Dolphin, he was with J.P. Morgan Investment Management, Inc. for ten years.
        He received an A.B. degree in Economics from Harvard in 1978. Mr. Salas was elected to the
        Board of Directors on October 8, 2002. Mr. Salas also serves on the boards of Williams
        Controls, Inc. and Southwall Technologies, Inc.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Director Independence</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company qualifies as a &ldquo;smaller reporting
        company&rdquo; as that term is defined in Item 10(f)(1) of Regulation S-K because its
        public float as of the last business day of the Company&rsquo;s most recent second fiscal
        quarter (June 30, 2007) was less than $75 million. As a result, the rules of the American
        Stock Exchange (the &ldquo;AMEX&rdquo;) require that at least fifty (50%) percent of the
        members of the Company&rsquo;s Board of Directors be independent in that they are not
        officers of the Company and are free of any relationship that would interfere with the
        exercise of their independent judgment. The rules of the AMEX also require since the
        Company is a smaller reporting company that the Company&rsquo;s Board of Directors&rsquo;
        Audit Committee be comprised of at least two members all of whom qualify as independent
        under the criteria set forth in Rule 10 A-3 of the Securities Exchange Act of 1934. The
        Board of Directors has determined that three of the five director-nominees, Matthew K.
        Behrent, John A. Clendening and Carlos P. Salas, are independent as defined by the listing
        standards of the AMEX, Section 10A(m)(3) of the Securities Exchange Act of 1934 and the
        rules and regulations of the Securities and Exchange Commission. In reaching its
        determination, the Board of Directors reviewed certain categorical independence standards
        it has adopted to provide assistance in the determination of director independence. The
        categorical standards are set forth below and provide that a director will not qualify as
        an independent director under the Rules of the AMEX if:<br>
        &nbsp;<br>
        </p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director is, or has been during the last three years, an employee or an
                    officer of the Company or any of its affiliates;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="3">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director has received, or has an immediate family member<sup>3</sup> who
                    has received, during any twelve consecutive months in the last three years any
                    compensation from the Company in excess of $100,000, other than compensation
                    for service on the Board of Directors, compensation to an immediate family
                    member who is an employee other than an executive officer, benefits under a
                    tax-qualified retirement plan, or non-discretionary compensation;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director is a member of the immediate family of an individual who is, or
                    has been in any of the past three years, employed by the Company or any of its
                    affiliates as an executive officer;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director, or an immediate family member, is a partner in, or controlling
                    shareholder or an executive officer of, any for-profit business organization to
                    which the Company made, or received, payments (other than those arising solely
                    from investments in the Company&rsquo;s securities) that exceed 5% of the
                    Company&rsquo;s or business organization&rsquo;s consolidated gross revenues
                    for that year, or $200,000, whichever is more, in any of the past three years;
                    or</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director, or an immediate family member, is employed as an executive
                    officer of another entity where at any time during the most recent three fiscal
                    years any of the Company&rsquo;s executives serve on that entity&rsquo;s
                    compensation committee.</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director, or an immediate family member, is a current partner of the
                    Company&rsquo;s outside auditors, or was a partner or employee of the
                    Company&rsquo;s outside auditors who worked on the Company&rsquo;s audit at any
                    time during the past three years.</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The following additional categorical standards were employed by the Board in determining
        whether a director qualified as independent to serve on the Audit Committee and provide
        that a director will not qualify if:</p>

        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director directly or indirectly accepts any consulting, advisory, or other
                    compensatory fee from the Company or any of its subsidiaries; or</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="3">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    The Director is an affiliated person<sup>4</sup> of the Company or any of its
                    subsidiaries.</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Committees</u></b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company&rsquo;s Board has operating audit, nomination and
        governance, compensation/stock option, and frontier exploration committees.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Audit
        Committee</u></b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In Fiscal 2007, director-nominees John A. Clendening, Carlos
        P. Salas and Matthew K. Behrent were the members of the Audit Committee. Mr. Behrent was
        the Chairman of the Committee and the Board of Directors determined that Mr. Behrent was an
        &ldquo;audit committee financial expert&rdquo; as defined by applicable Securities and
        Exchange Commission (&ldquo;SEC&rdquo;) regulations. Each of the members of the Audit
        Committee met the independence and experience requirements of the AMEX, the applicable
        Securities Laws, and the regulations and rules promulgated by the SEC.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The Audit Committee adopted an Audit Committee Charter during fiscal 2001. In 2004, the
        Board adopted an amended Audit Committee Charter, a copy of which is available on the
        Company&rsquo;s internet website, www.tengasco.com. The Audit Committee reviews and
        reassess the Audit Committee Charter annually.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The Audit Committee's functions are:</p>

        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="72">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    To review with management and the Company&rsquo;s independent auditors the
                    scope of the annual audit and quarterly statements, significant financial
                    reporting issues and judgments made in connection with the preparation of the
                    Company&rsquo;s financial statements;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="72">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    To review major changes to the Company&rsquo;s auditing and accounting
                    principles and practices suggested by the independent auditors;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="72">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    To monitor the independent auditor's relationship with the Company;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="72">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    To advise and assist the Board of Directors in evaluating the independent
                    auditor's examination;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="72">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    To supervise the Company's financial and accounting organization and financial
                    reporting;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="72">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    To nominate, for approval of the Board of Directors, a firm of certified public
                    accountants whose duty it is to audit the financial records of the Company for
                    the fiscal year for which it is appointed; and</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="72">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; FONT-FAMILY: 'SYMBOL'">
                    &middot;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    To review and consider fee arrangements with, and fees charged by, the
                    Company&rsquo;s independent auditors.</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The Audit Committee met six times in Fiscal 2007 with the Company&rsquo;s auditors,
        including to discuss the audit of the Company&rsquo;s year end financial statements. It is
        intended that if elected as directors in 2008 Messrs. Clendening, and Salas will continue
        to serve as members of the Audit Committee along with Mr. Behrent who will serve as the
        Chairman of the Committee and as its designated financial expert.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<i>
        Audit Committee Report</i><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Audit Committee has:<br>
        &nbsp;<br>
        </p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0px; FONT-FAMILY: 'CENTURY SCHOOLBK ROMAN'">
                    <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">I.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; FONT-FAMILY: 'CENTURY SCHOOLBK ROMAN'" align="justify">
                    <font style="FONT-SIZE: 12pt; FONT-FAMILY: 'TIMES NEW ROMAN'">Reviewed and
                    discussed the Company&rsquo;s unaudited financial statements for the first
                    three quarters of Fiscal 2007 and the Company&rsquo;s audited financial
                    statements for the year ended December 31, 2007 with the management of the
                    Company and the Company&rsquo;s independent auditors;</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0px; FONT-FAMILY: 'CENTURY SCHOOLBK ROMAN'">
                    <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">II.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; FONT-FAMILY: 'CENTURY SCHOOLBK ROMAN'" align="justify">
                    <font style="FONT-SIZE: 12pt; FONT-FAMILY: 'TIMES NEW ROMAN'">Discussed with
                    the Company&rsquo;s independent auditors the matters required to be discussed
                    by Statement of Auditing Standards No. 61, as the same was in effect on the
                    date of the Company&rsquo;s financial statements; and</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="48">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0px; FONT-FAMILY: 'CENTURY SCHOOLBK ROMAN'">
                    <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">III.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; FONT-FAMILY: 'CENTURY SCHOOLBK ROMAN'" align="justify">
                    <font style="FONT-SIZE: 12pt; FONT-FAMILY: 'TIMES NEW ROMAN'">Received the
                    written disclosures and the letter from the Company&rsquo;s independent
                    auditors required by Independence Standards Board Standard No. 1 (Independence
                    Discussions with Audit Committees), as the same was in effect on the date of
                    the Company&rsquo;s financial statements, has discussed with representatives of
                    the Company&rsquo;s independent auditors the auditors independence from
                    management and the Company and satisfied itself as to the Company&rsquo;s
                    auditors independence.</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based on the foregoing materials and discussions, the Audit
        Committee recommended to the Board of Directors that the unaudited financial statements for
        each of the first three quarters of Fiscal 2007 be included in the Quarterly Reports on
        Form 10-Q for those quarters and that the audited financial statements for the year ended
        December 31, 2007 be included in the Company&rsquo;s Annual Report on Form 10-K for the
        year ended December 31, 2007.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Members
        of the Audit Committee<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Matthew
        K. Behrent<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;John
        A. Clendening<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Carlos
        P. Salas</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Nomination and Governance
        Committee</u></b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In Fiscal 2007, the members of the Nomination and Governance
        Committee were director-nominees Carlos P. Salas and Matthew K. Behrent with Mr. Salas
        acting as Chairman. As stated above, the Company believes that each member of the Committee
        was independent as that term is defined under the rules of the AMEX. The Committee met one
        time in Fiscal 2007. The Committee, among other duties, determines the slate of director
        candidates to be presented for election at the Company&rsquo;s annual meeting of
        shareholders. Although the Company does not have a nominating committee charter, the
        Company&rsquo;s Board of Directors has adopted procedures for annual director nominations
        by the Nomination and Governance Committee. Those procedures provide that the
        qualifications that should be met by any person recommended as a nominee for a position on
        the Company&rsquo;s Board of Directors should include one or more of the following: a
        background or experience in oil and gas exploration, production, transportation, geology,
        construction, finance or in another business, government service, or profession that would
        reasonably enable the nominee to provide seasoned and reputable service to the shareholders
        of the Company in the performance of the duties of a member of the Board of Directors. In
        addition to these qualifications, a nominee must be willing to serve without a right to
        receive compensation for such service. The Committee has not paid fees to any third party
        to identify, evaluate or to assist in identifying or evaluating, potential nominees, but
        may do so in the future if it determines it necessary.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company has no separate policy with regard to the
        consideration of any director candidates recommended by security holders. However, the
        Nomination Committee will consider director candidates recommended by security holders
        provided that such nominations are timely made as set forth hereinafter under the heading
        &ldquo;Stockholders Proposals&rdquo;. Any person recommended by a security holder to serve
        on the Board of Directors is considered upon the same terms as candidates recommended by
        any other person. To date, the Company has not received any recommendations from
        shareholders requesting that the Nomination and Governance Committee consider a candidate
        for inclusion among the Committee&rsquo;s slate of nominees in the Company&rsquo;s proxy
        statement.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Among the nominating procedures adopted are the following:
        (1) Any shareholder, officer, or director may recommend for nomination any person for the
        slate of candidates for membership on the Company&rsquo;s Board of Directors to be
        presented to the shareholders at the Company&rsquo;s annual meeting of shareholders. Such
        recommendations must be furnished in writing addressed to the Company&rsquo;s Board of
        Directors at the Company&rsquo;s principal offices. All such nominations will be furnished
        to the Nomination Committee which may conduct interviews, investigations or make other
        determinations as to the qualifications of such recommended persons. (2) Any then-current
        members of the Board of Directors desiring to stand for re-election may be placed on the
        slate of directors for re-election without further inquiry as to their qualifications. (3)
        The Nomination Committee will meet to determine the slate of candidates for the Board in
        such a manner and at such a time so as not to delay either the mailing of the proxy
        statement to the Company&rsquo;s shareholders or the annual meeting of shareholders. At
        such meeting, each recommended person including directors standing for re-election shall be
        subject to affirmative vote of half or more of the members of the Nomination Committee for
        inclusion on the slate of nominees. (4) The adopted procedures apply only to the
        determination of the slate of directors to be presented for election at the annual meeting
        of the shareholders. Any vacancies on the Board of Directors following the annual meeting
        of shareholders may be filled in the manner currently applicable under the Company&rsquo;s
        Charter, Bylaws, and applicable state law. (5) The procedures adopted may be amended from
        time to time by the Board of Directors or by the Nomination Committee, in order to comply
        with any applicable provision or interpretation of any rule, statute, or stock exchange
        rule of the exchange on which the Company&rsquo;s stock may be listed.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The nomination procedures adopted are posted on the
        Company&rsquo;s internet website at www.tengasco.com. In the event of any such amendment to
        the procedures, the Company intends to disclose the amendments on the Company's internet
        website within five business days following such amendment.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Nomination Committee determined the slate of candidates
        for the Board of Directors presented for election at this year&rsquo;s Annual Meeting.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The other function of this Committee is to oversee the
        Company&rsquo;s compliance with the corporate governance requirements of the SEC and the
        AMEX. The Chairman of the Committee, Carlos P. Salas, is an attorney with experience in the
        area of securities law.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Compensation/Stock Option
        Committee<br>
        &nbsp;</u></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The members of the Compensation/Stock Option Committee in
        Fiscal 2007 were director-nominees John A. Clendening and Carlos P. Salas with Mr.
        Clendening acting as Chairman. Messrs. Salas and Clendening both meet the current
        independence standards established by the AMEX.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The Board of Directors has adopted a charter for the Compensation/Stock Option Committee
        which is available at the Company&rsquo;s internet website, www.tengasco.com
        </p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Compensation/Stock Option Committee&rsquo;s functions, in
        conjunction with the Board of Directors, are to provide recommendations with respect to,
        general and specific compensation policies and practices of the Company for directors,
        officers and other employees of the Company. The Compensation/Stock Option Committee
        expects to periodically review the approach to executive compensation and to make changes
        as competitive conditions and other circumstances warrant and will seek to ensure the
        Company's compensation philosophy is consistent with the Company's best interests and is
        properly implemented. The Committee determines or recommends to the Board of Directors for
        determination the specific compensation of the Company&rsquo;s Chief Executive Officer and
        all of the Company&rsquo;s other officers. Although the Committee may seek the input of the
        Company&rsquo;s Chief Executive Officer in determining the compensation of the
        Company&rsquo;s other executive officers, the Chief Executive Officer may not be present
        during the voting or deliberations with respect to his compensation. The Committee may not
        delegate any of its responsibilities unless it is to a subcommittee formed by the
        Committee, but only if such subcommittee consists entirely of directors who meet the
        independence requirements of the AMEX.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Compensation/Stock Option Committee is also charged with
        administering the Tengasco, Inc. Stock Incentive Plan (the &ldquo;Stock Incentive
        Plan&rdquo;). The Compensation/Stock Option Committee has complete discretionary authority
        with respect to the awarding of options and Stock Appreciation Rights (&ldquo;SARs&rdquo;),
        under the Stock Incentive Plan, including, but not limited to, determining the individuals
        who shall receive options and SARs; the times when they shall receive them; whether an
        option shall be an incentive or a non-qualified stock option; whether an SAR shall be
        granted separately, in tandem with or in addition to an option; the number of shares to be
        subject to each option and SAR; the term of each option and SAR; the date each option and
        SAR shall become exercisable; whether an option or SAR shall be exercisable in whole, in
        part or in installments and the terms relating to such installments; the exercise price of
        each option and the base price of each SAR; the form of payment of the exercise price; the
        form of payment by the Company upon the exercise of an SAR; whether to restrict the sale or
        other disposition of the shares of common stock acquired upon the exercise of an option or
        SAR; to subject the exercise of all or any portion of an option or SAR to the fulfillment
        of a contingency, and to determine whether such contingencies have been met; with the
        consent of the person receiving such option or SAR, to cancel or modify an option or SAR,
        provided such option or SAR as modified would be permitted to be granted on such date under
        the terms of the Stock Incentive Plan; and to make all other determinations necessary or
        advisable for administering the Plan.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Compensation/Stock Option Committee met one time in
        Fiscal 2007. The Committee has the authority to retain a compensation consultant or other
        advisors to assist it in the evaluation of compensation and has the sole authority to
        approve the fees and other terms of retention of such consultants and advisors and to
        terminate their services. To date, the Committee has not retained any such consultants or
        advisors to assist it, although it may do so in the future if it deems it necessary. A more
        detailed discussion of the actions taken in Fiscal 2007 by the Committee with respect to
        the compensation of the Company&rsquo;s executive officers is set forth below under the
        heading Compensation Discussion and Analysis in the section entitled Executive
        Compensation.<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<i>
        Compensation/Stock Option Committee Interlocking<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;And
        Insider Participation</i><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No interlocking relationship existed or exists between any
        member of the Company's Compensation/Stock Option Committee and any member of the
        compensation committee of any other company, nor has any such interlocking relationship
        existed in the past. No member or nominee of the Compensation/Stock Option Committee is an
        officer or an employee of the Company.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<i>
        Compensation Committee Report<br>
        &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</i> The Compensation/Stock Option Committee has reviewed
        and discussed the Compensation Discussion and Analysis set forth below under the heading
        &ldquo;Executive Compensation &ndash; Compensation Discussion and Analysis&rdquo; with
        management. Based on this review and discussion, the Compensation/Stock Option Committee
        recommended to the Company&rsquo;s Board of Directors that the Compensation Discussion and
        Analysis be included in this proxy statement and incorporated by reference into the
        Company&rsquo;s Annual Report on Form 10-K for the fiscal year ended December 31, 2007.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
        Members of the Compensation/Stock</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 2.5in; TEXT-INDENT: 36px" align="justify">
        Option Committee</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 2.5in; TEXT-INDENT: 36px" align="justify">
        John A. Clendening</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 2.5in; TEXT-INDENT: 36px" align="justify">
        Carlos P. Salas</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Other
        Committees</u></b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company&rsquo;s Board also has a frontier exploration
        committee. The members of this Committee in Fiscal 2007 were Jeffrey R. Bailey, John A.
        Clendening and Carlos P. Salas. The Committee met three (3) times in Fiscal 2007 to discuss
        new areas of potential development for the Company.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Section 16(a) Beneficial Ownership Reporting
        Compliance</u></b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        Section 16(a) of the Securities Exchange Act of 1934 requires the Company&rsquo;s executive
        officers, directors and persons who beneficially own more than 10% of the Company&rsquo;s
        Common Stock to file initial reports of ownership and reports of changes in ownership with
        the SEC no later that the second business day after the date on which the transaction
        occurred unless certain exceptions apply. In fiscal 2007, the Company, its officers and
        directors and its shareholders owning more than 10% of its common stock were not delinquent
        in filing of any of its Form 3, 4, and 5 reports except that Charles Patrick McInturff
        failed to timely file his Report on Form 3 after he was appointed a Vice President of
        Company in December 2007. Mr. McInturff subsequently filed the Form 3 Report which
        indicated that he did not own any shares of stock of the Company or any derivative
        instruments granting him rights to acquire shares of the Company at the time he was
        appointed Vice President.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Family and Other Relationships</u></b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There are no family relationships between any of the present
        directors or executive officers of the Company except that Carlos P. Salas, a Director of
        the Company, is the cousin of Peter E. Salas, also a director of the Company. Mr. Carlos P.
        Salas is also one of seven members of Dolphin Advisors, LLC which serves as the managing
        general partner of Dolphin Direct Equity Partners, L.P., a private company investment fund
        that is not a shareholder of the Company. The majority owner of Dolphin Advisors, LLC is
        Dolphin Management, Inc., the sole shareholder of which is Peter E. Salas. Dolphin
        Management, Inc. is also the managing partner of Dolphin Offshore Partners, L.P. which
        directly owns 20,839,492 shares of the Company&rsquo;s common stock. Peter E. Salas is the
        controlling person of Dolphin Offshore Partners, L.P. Carlos P. Salas has no direct or
        indirect ownership interest in Dolphin Offshore Partners, L.P. All of these factors were
        considered by the Board of Directors in making its determination that Carlos P. Salas is an
        independent director. See above, &ldquo;Director Independence&rdquo;. There are no family
        relationships between any of the other Directors or executive officers of the Company.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Involvement in Certain Legal
        Proceeding</u></b><u>s</u><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To the knowledge of management, no director, executive
        officer or affiliate of the Company or owner of record or beneficially of more than 5% of
        the Company's common stock is a party adverse to the Company or has a material interest
        adverse to the Company in any proceeding.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To the knowledge of management, during the past five years,
        no present director, executive officer or person nominated to become a director or an
        executive officer of the Company:<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 1.5in; TEXT-INDENT: -36px" align="justify">
        (1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Filed a petition under the federal bankruptcy laws or any
        state insolvency law, nor had a receiver, fiscal agent or similar officer appointed by a
        court for the business or property of such person, or any partnership in which he or she
        was a general partner at or within two years before the time of such filing, or any
        corporation or business association of which he or she was an executive officer at or
        within two years before the time of such filing;</p>

        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="96">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt">
                    <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    Was convicted in a criminal proceeding or named the subject of a pending
                    criminal proceeding (excluding traffic violations and other minor
                    offenses);</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="96">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt">
                    <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    Was the subject of any order, judgment or decree, not subsequently reversed,
                    suspended or vacated, of any court of competent jurisdiction, permanently or
                    temporarily enjoining him or her from or otherwise limiting his or her
                    involvement in any type of business, commodities, securities or banking
                    activities;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="96">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt">
                    <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    Was the subject of any order, judgment or decree, not subsequently reversed,
                    suspended or vacated, of any Federal or State authority barring, suspending or
                    otherwise limiting him or her for more than 60 days from engaging in, or being
                    associated with any person engaging in, any type of business, commodities,
                    securities or banking activities;</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p></p>

        <table>
            <tr>
                <td width="96">
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt">
                    <font style="FONT-FAMILY: 'TIMES NEW ROMAN'">(5)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
                </td>

                <td valign="top">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in" align="justify">
                    Was found by a court of competent jurisdiction in a civil action or by the SEC
                    or the Commodity Futures Trading Commission (&ldquo;CFTC&rdquo;) to have
                    violated any federal or state securities law or Federal commodities law, and
                    the judgment in such civil action or finding by the SEC or CFTC has not been
                    subsequently reversed, suspended, or vacated.</p>
                </td>
            </tr>
        </table>
        <br>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Stockholder Communications with the Board of
        Directors</u></b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stockholders may communicate with the Board of Directors of
        the Company by writing to: Cary V. Sorensen, Secretary, Tengasco, Inc., 10215 Technology
        Drive, N.W., Suite 301, Knoxville, TN 37932 or by e-mail: to: CSorensen@tengasco.com

        Subject: Communication to Board of Directors. All letters and e-mails will be answered, if
        possible, and will be distributed to board members as appropriate. Notwithstanding the
        foregoing, the Company has the authority to discard or disregard any communication, which
        is unduly hostile, threatening, illegal or otherwise inappropriate or to take any other
        appropriate actions with respect to such communications.<br>
        </p>
        <!-- PAGE BREAK  --><!-- EEDocs PBStart-->
        <hr align="center" width="100%" noshade size="2">

        <p style="PAGE-BREAK-AFTER: always"></p>
        <!-- EEDocs PBEnd-->

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS</b></p>

        <p></p>

        <p></p>

        <table cellspacing="0" cellpadding="0" width="600" border="0">
            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u><font style="FONT-SIZE: 11pt">Name and Address</font></u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u><font style="FONT-SIZE: 11pt">Title</font></u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <b><font style="FONT-SIZE: 11pt">Number of Shares</font></b></p>

                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <b><u><font style="FONT-SIZE: 11pt">Beneficially
                    Owned</font></u></b><sup><font style="FONT-SIZE: 11pt">5</font></sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <b><font style="FONT-SIZE: 11pt">Percent of</font></b></p>
                    <b><u><font style="FONT-SIZE: 11pt">Class</font></u></b>
                    <sup><font style="FONT-SIZE: 11pt">6</font></sup>

                    <p></p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Jeffrey R. Bailey<br>
                    2306 West Gallaher Ferry<br>
                    Knoxville, TN 37932<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director;<br>
                    Chief Executive<br>
                    Officer</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    926,287<sup>7</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    1.5%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Matthew K. Behrent</p>

                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    c/o EDC LLC<br>
                    825 8<sup>th</sup> Avenue 23<sup>rd</sup> Floor<br>
                    New York, NY 10019</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    None</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    0%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    John A. Clendening</p>

                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    1031 Saint Johns Drive<br>
                    Maryville, TN 37801<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    375,500<sup>8</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Less than 1%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Carlos P. Salas</p>

                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    129 East 17<sup>th</sup> Street<br>
                    New York, NY 10003<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    105,500<sup>9</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Less than 1%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Peter E. Salas</p>
                    PO Box 16867<br>
                    Fernandina, FL 32035<br>


                    <p></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Director;<br>
                    Chairman of the Board</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    21,107,492<sup>10</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="127">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    35.6%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Mark A. Ruth<br>
                    9400 Hickory Knoll Lane<br>
                    Knoxville, TN 37931<br>
                    &nbsp;<br>
                    &nbsp;<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Chief Financial<br>
                    Officer</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    315,100<sup>11</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="132" colspan="2">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Less than 1%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Cary V. Sorensen<br>
                    5517 Crestwood Drive<br>
                    Knoxville, TN 37919<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Vice President;<br>
                    General Counsel;<br>
                    Secretary<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    295,000<sup>12</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="132" colspan="2">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Less than 1%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Charles Patrick McInturff<br>
                    7500 San Felipe, Suite 400<br>
                    Houston, TX 77063<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Vice President</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    80,000<sup>13</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="132" colspan="2">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Less than 1%</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="199">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    All Officers and<br>
                    Director-Nominees<br>
                    As a group</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="120">
                &nbsp;</td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="144">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    23,204,879<sup>14</sup></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="132" colspan="2">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    38%</p>
                </td>
            </tr>
        </table>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        <b><u>Change In Control</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To the knowledge of the Company&rsquo;s management, there are
        no present arrangements or pledges of the Company&rsquo;s securities which may result in a
        change in control of the Company.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b><u>EXECUTIVE COMPENSATION</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px; TEXT-DECORATION: underline" align="justify">
        <b><u>Compensation Discussion and Analysis</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The objectives of the Company&rsquo;s compensation programs
        are to attract and retain qualified and talented professional individuals to perform the
        duties of the Company&rsquo;s executive offices.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company&rsquo;s compensation program is designed to
        fairly reward the Company&rsquo;s executive officers for their overall performance in long
        term management of the affairs of an oil and gas exploration, production, and marketing
        company. The measurement of successful performance has significant elements of subjective
        judgment in view of the lack of any directly comparable single element or group of elements
        to which the Company and its performance may be readily compared from time to time. The
        variable elements include market capitalization, nature and size of the Company&rsquo;s
        reserves, growth of the Company&rsquo;s reserve base, and the number of and duties of the
        executive officers of other companies that may be comparable to the Company in one or more
        aspect of their operations.<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The elements of the Company&rsquo;s compensation programs
        include salary, health insurance, stock options, and in certain circumstances the award of
        a cash bonus. As of the present time, the Company compensation plan does not include any
        retirement plan; any retirement savings plan; any life or disability insurance plan; any
        social club memberships or dues or any payments for housing, cars, boats, or other property
        of any kind to any person. The Company has not entered into any contracts for compensation
        to any person in the event of a change in control of the Company. The Company reimburses
        costs of maintaining required professional certifications for its chief financial officer
        and general counsel, and provides use of a company vehicle for the Company&rsquo;s chief
        executive officer and Vice President Patrick McInturff. The Company pays no other elements
        of compensation to its executive officers. The relatively small size of the Company in
        comparison to many entities engaged in the capital-intensive oil and gas business coupled
        with the lack of many elements of compensation maintained by some of those companies
        presents the Company with additional risks in meeting its objectives of attracting and
        retaining qualified and talented professional individuals.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company chooses to pay each element in order to best meet
        the Company&rsquo;s goal of attracting and retaining qualified and talented professional
        individuals. The salary component of the compensation is important and the Company attempts
        to be competitive with what it believes to be the compensation of other companies of
        similar size and scope of operations. To date, the Company has not engaged the services of
        a compensation review consultant or service in view of the cost of such services compared
        to the size and revenues of the Company. The stock option element of compensation is paid
        in order to provide additional compensation in the long term commensurate with growth of
        the Company and increased share value that may result from the performance of the executive
        receiving the options. The award of a bonus upon review of Company performance provides an
        additional incentive. The lack of other compensation elements such as other insurance,
        retirement, or retirement savings plans focuses the importance of the salary and stock
        option elements of the Company&rsquo;s compensation plan.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company determines the amount (and, where applicable, the
        formula) for each element to pay by reviewing annually the compensation levels of the
        Company&rsquo;s executive officers and determining from the performance of the Company
        during that time since the last review what appropriate compensation levels may be during
        the upcoming annual period. The Company has no existing formula for determination of the
        salary, stock options, or bonus elements of compensation.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each compensation element and the Company&rsquo;s decisions
        regarding that element fit into the Company&rsquo;s overall compensation objectives and
        affect decisions regarding other elements in this manner: the salary and stock option
        elements (being the significant elements of overall compensation) are intended to serve
        primarily as current and long-term compensation respectively. Review of salary levels and
        consideration of bonus awards on an annual basis and vesting of options over a forward
        period serve to allow the Company to attempt to meet its objectives of attracting and
        maintaining qualified and talented professional individuals in service as the
        Company&rsquo;s executive officers.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Applying these principles, the Company compensated its
        executive officers for 2007 as set forth in the tables below.<br>
        </p>
        <!-- PAGE BREAK  --><!-- EEDocs PBStart-->
        <hr align="center" width="100%" noshade size="2">

        <p style="PAGE-BREAK-AFTER: always"></p>
        <!-- EEDocs PBEnd-->

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Executive Officer Compensation</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The following table sets forth a summary of all compensation awarded to, earned or paid to,
        the Company's Chief Executive Officer, Chief Financial Officer and other executive officers
        whose compensation exceeded $100,000 during fiscal years ended December 31, 2007, December
        31, 2006 and December 31, 2005.</p>

        <p></p>

        <p></p>

        <table cellspacing="0" cellpadding="0" width="631" border="0">
            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: black 0.5pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="631" colspan="10">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
                    <b>Summary Compensation Table</b></p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Name<br>
                     and Principal Position<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (a)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="36">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Year<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (b)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Salary<br>
                    ($)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (c)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Bonus<br>
                    ($)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (d)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="48">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Stock<br>
                    Awards<br>
                    ($)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (e)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Option<br>
                    Awards<br>
                    ($)</font><sup><font style="FONT-SIZE: 8pt">15</font></sup><br>
                    &nbsp;<br>
                    &nbsp;<br>
                    &nbsp;<br>
                    &nbsp;<br>
                    <font style="FONT-SIZE: 8pt">(f)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">Non-Equity<br>
                    Incentive Plan Comp-ensation<br>
                    &nbsp;<br>
                     ($) (g)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">Nonqualified Deferred Compensation Earnings
                    ($)<br>
                    <br>
                    &nbsp;<br>
                     &nbsp;<br>
                     (h)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">All<br>
                     Other Compensation<br>
                     ($)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (i)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="72">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">Total<br>
                    ($</font><font style="FONT-SIZE: 10pt">)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;</font></p>
                    <font style="FONT-SIZE: 8pt">(j)</font>

                    <p></p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">Jeffrey R. Bailey</font>
                    <sup><font style="FONT-SIZE: 8pt">16</font></sup><br>
                    <font style="FONT-SIZE: 8pt">Chief Executive Officer</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="36">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">2007<br>
                    2006<br>
                    2005</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$165,000<br>
                    $150,000<br>
                    $130,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$49,500</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="48">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$11,000<br>
                    $187,500</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="72">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$214,500<br>
                    $161,000<br>
                    $317,500</font></p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">Mark A. Ruth<br>
                    Chief Financial Officer</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="36">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">2007<br>
                    2006<br>
                    2005</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$125,400<br>
                    $114,000</font></p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
                    <font style="FONT-SIZE: 8pt">$92,500</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$25,080</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="48">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$3,450<br>
                    $60,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="72">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$150,480<br>
                    $117,450<br>
                    $152,500</font></p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">Cary V. Sorensen General Counsel</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="36">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">2007<br>
                    2006<br>
                    2005</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$125,400<br>
                    $114,000<br>
                    $92,500</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$5,096<br>
                    $25,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="48">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$3,450<br>
                    $60,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="60">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="84">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="72">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="right">
                    <font style="FONT-SIZE: 8pt">$130,496<br>
                    $142,450<br>
                    $152,500</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        <b><u>Grants of Plan Based Awards in Fiscal 2007</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No equity or non-equity incentive plan awards or stock awards
        or options were granted during Fiscal 2007 to the Company's Chief Executive Officer, Chief
        Financial Officer or any of the Company's most highly compensated executive officers whose
        compensation exceeded $100,000 for Fiscal 2007.</p>
        <!-- NEXT PAGE SECTION BREAK  --><!-- EEDocs PBStart-->
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        <p style="PAGE-BREAK-AFTER: always"></p>

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        </p>

        <table cellspacing="0" cellpadding="0" width="607" border="0">
            <tr>
                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="607" colspan="10">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
                    <b>Outstanding Equity Awards at Fiscal Year-End</b></p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="320" colspan="5">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 10pt">Option
                    Awards</font><sup><font style="FONT-SIZE: 10pt">17</font></sup></p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="63">
                &nbsp;</td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="224" colspan="4">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 10pt">Stock Awards</font></p>
                </td>
            </tr>

            <tr style="HEIGHT: 155.8pt">
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Name<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (a)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Number of Securities Underlying Unexercised
                    Options<br>
                    (#)<br>
                    Exercisable<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (b)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="75">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Number of Securities Underlying Unexercised
                    Options<br>
                    (#)<br>
                    Unexercisable<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (c)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Equity Incentive Plan Awards: Number of Securities
                    Underlying Unexercised Unearned Options<br>
                    &nbsp;<br>
                     (#)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (d)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="52">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Option Exercise Price<br>
                    ($)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (e)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="63">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Option Expiration<br>
                     Date<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (f)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Number of Shares or Units of Stock That Have Not
                    Vested<br>
                    (#)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (g)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="47">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Market Value of Shares or Units of Stock That Have
                    Not Vested<br>
                    (#)<br>
                    &nbsp;<br>
                     (h)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Equity Incentive Plan Awards: Number of Unearned
                    Shares, Units or Other Rights That Have Not Vested<br>
                    (#)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (i)</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Equity Incentive Plan Awards: Market or Payout
                    Value of Unearned Shares, Units or Other Rights That Have Not Vested<br>
                    (#)<br>
                    &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     &nbsp;<br>
                     (j)</font></p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Jeffrey R.<br>
                    Bailey<br>
                    Chief<br>
                    Executive Officer</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">750,000</font><sup><font style="FONT-SIZE: 8pt">18</font></sup><br>

                    <font style="FONT-SIZE: 8pt">20,000<br>
                    20,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="75">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">500,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="52">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">$0.27<br>
                    $0.58<br>
                    $0.81</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="63">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">4/20/2010<br>
                    1/20/2011<br>
                    12/13/2011</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="47">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                &nbsp;</td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Mark A.<br>
                    Ruth<br>
                    Chief<br>
                    Financial<br>
                    Officer</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">240,000</font><sup><font style="FONT-SIZE: 8pt">19</font></sup><br>

                    <font style="FONT-SIZE: 8pt">15,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="75">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">160,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="52">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">$0.27<br>
                    $0.58</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="63">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">4/20/2010<br>
                    1/20/2011</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="47">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                &nbsp;</td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: black 0.5pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">Cary V.<br>
                    Sorensen<br>
                    General<br>
                    Counsel</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    <font style="FONT-SIZE: 8pt">240,000</font><sup><font style="FONT-SIZE: 8pt">20</font></sup><br>

                    <font style="FONT-SIZE: 8pt">15,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="75">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">160,000</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="67">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="52">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">$0.27<br>
                    $0.58</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="63">
                    <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    <font style="FONT-SIZE: 8pt">4/20/2010<br>
                    1/20/2011</font></p>
                </td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="57">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="47">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                &nbsp;</td>

                <td style="BORDER-RIGHT: black 0.5pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 0.5pt solid" valign="top" width="59">
                &nbsp;</td>
            </tr>
        </table>
        <br>
        <br>


        <p></p>
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        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        <b><u>Options Exercises and Stock Vested in Last Fiscal Year</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In Fiscal 2007, no options were exercised by, and no stock
        awards vested to, the Company's Chief Executive Officer, Chief Financial Officer or any of
        the Company's most highly compensated executive officers whose compensation exceeded
        $100,000 for Fiscal 2007.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The Company does not presently have a pension or similar plan for its directors, executive
        officers or employees. Management has acquired full liability insurance for directors and
        executive officers and is considering adopting a 401(k) plan. However, there are no
        immediate plans to adopt a 401(k) plan at this time.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        <b><u>Employment Contracts</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On December 18, 2007, the Company entered into a two-year
        employment agreement with Charles Patrick McInturff pursuant to which Mr. McInturff will
        serve as Vice-President of the Company. Mr. McInturff will receive a salary of $185,000 per
        annum and will be eligible to receive a bonus based on his performance and the performance
        of the Company&rsquo;s business as determined by the Compensation/Stock Option Committee of
        the Board of Directors, although no such bonus is guaranteed. Mr. McInturff will also be
        eligible to receive grants of stock options and as inducement to enter into the employment
        agreement with the Company, on February 1, 2008 he was granted an option to purchase
        400,000 shares of the Company&rsquo;s common stock at a price of $0.57 per share which was
        the closing price of the Company&rsquo;s common stock as listed on the American Stock
        Exchange on the date the option was granted. The term of the option granted was for a
        period of five years with one-fifth of the option vesting immediately and the remainder
        vesting in equal increments over four years. During the term of the employment agreement
        Mr. McInturff shall have the right to participate in all employee benefit plans of the
        Company in effect and generally available to all similarly situated employees including,
        but not limited to, any health, hospitalization and other group insurance plans.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There are presently no employment contracts relating to any
        other member of management. However, depending upon the Company's operations and
        requirements, the Company may offer long-term contracts to other executive officers or key
        employees in the future.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        <b><u>Compensation of Directors</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has resolved to compensate members of
        the Board of Directors for attendance at meetings at the rate of $250 per day, together
        with direct out-of-pocket expenses incurred in attendance at the meetings, including
        travel. The Directors, however, have waived such fees due to them as of this date for prior
        meetings.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        Members of the Board of Directors may also be requested to perform consulting or other
        professional services for the Company from time to time. The Board of Directors has
        reserved to itself the right to review all directors' claims for compensation on an ad hoc
        basis.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Directors who are on the Company&rsquo;s Audit,
        Compensation/Stock Option and Nomination and Governance Committees are independent and
        therefore, do not receive any consulting, advisory or compensatory fees from the Company.
        However, such Board members may receive fees from the Company for their services on those
        committees. They may also from time to time be granted stock options under the Tengasco,
        Inc. Stock Incentive Plan. A plan (the &ldquo;Plan&rdquo;) to issue cash and/or shares of
        stock to independent directors for service on the various committees of the Board of
        Directors was authorized by the Board of Directors and approved by the Company&rsquo;s
        shareholders. A copy of the Plan is posted at the Company&rsquo;s website at
        www.tengasco.com.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under the Plan, the Board of Directors, in its discretion,
        from time to time may grant compensation to any or all independent directors serving on the
        Company&rsquo;s Board of Directors as the Board may deem appropriate in the form of cash or
        Company stock, provided that the value of such compensation does not exceed the limits of
        compensation for determination of the independence of directors under rules and regulations
        of the SEC or the American Stock Exchange or such other exchange upon which shares of the
        Company may be listed. The Board may, but is not required, to consider the recommendations
        of the Compensation/Stock Option Committee with regard to any such cash or equity
        compensation to be awarded. No awards to any of the Company&rsquo;s independent Directors
        were granted under this Plan in Fiscal 2007.<br>
        &nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
        <b><u>CERTAIN TRANSACTIONS</u></b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as set forth hereafter, there have been no material
        transactions, series of similar transactions or currently proposed transactions during 2006
        and 2007, to which the Company or any of its subsidiaries was or is to be a party, in which
        the amount involved exceeds the lesser of $120,000 or one percent of the average of the
        Company&rsquo;s total assets at year-end for its last two completed fiscal years in which
        any director or executive officer or any security holder who is known to the Company to own
        of record or beneficially more than 5% of the Company's common stock, or any member of the
        immediate family of any of the foregoing persons, had a material interest.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        Hoactzin Partners, L.P. (&ldquo;Hoactzin&rdquo;) had acquired a 94.3% working interest in a
        twelve well drilling program (the &ldquo;Twelve Well Program&rdquo;) by the Company on its
        Kansas Properties in exchange for two promissory notes made by the Company in the aggregate
        principal amount of $2,514,000. The Company retained the remaining 5.7% working interest in
        the Twelve Well Program. The promissory notes exchanged by Hoactzin were originally issued
        by the Company in connection with loans made to the Company by Dolphin Offshore Partners,
        L.P. (&ldquo;Dolphin&rdquo;) to fund the Company&rsquo;s cash exchange to holders of its
        Series A, B and C Preferred Stock. Peter E. Salas, the Chairman of the Board of Directors
        of the Company, is the controlling person of Hoactzin. He is also the sole shareholder and
        controlling person of Dolphin Management, Inc., the general partner of Dolphin, which is
        the Company&rsquo;s largest shareholder.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        Under the terms of the Twelve Well Program, once Hoactzin were to receive total proceeds
        from its working interest in the program in the amount of $3,016,800 Hoactzin would pay the
        Company a management fee equal to 85% of the net revenues attributable to its working
        interest in the Program for the remaining life of the twelve wells. In addition, the
        Company had an option to repurchase from Hoactzin the obligation to drill the final six
        wells of the Twelve Well Program by paying to Hoactzin an amount equal to one half of the
        principal amount of the notes exchanged by Hoactzin, plus interest on that amount at 6% per
        annum until the date of repurchase, and granting to Hoactzin a 1/16 overriding royalty in
        both the six wells existing at the time of repurchase and the next six wells in the Program
        drilled by the Company. Thereafter, Hoactzin agreed to extend the option to an indefinite
        future date being not later than the beginning of drilling of what would be the seventh
        well in the program.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        In June 2006, the Company drilled the sixth well in the Twelve Well Program. On June 29,
        2006 the Company closed a $50,000,000 credit facility with Citibank Texas, N.A. The
        Company&rsquo;s initial borrowing base was set at $2,600,000 and the Company borrowed that
        amount on June 29, 2006 and used $1.393 million of the loan proceeds to exercise its option
        to repurchase from Hoactzin the Company&rsquo;s obligation to drill the final six wells in
        the Company&rsquo;s Twelve Well Program. As a result of the exercise of its repurchase
        option, the Company&rsquo;s drilling obligations under the Twelve Well Program have been
        satisfied and the Program has been converted to a six well program. If the Company had not
        exercised its repurchase option, Hoactzin would have received a 94% working interest in the
        final six wells of the Twelve Well Program. However, as a result of the repurchase,
        Hoactzin will now receive only a 6.25% overriding royalty in six Company wells to be
        drilled, plus an additional 6.25% overriding royalty in the six program wells that had
        previously been drilled as part of the Twelve Well Program.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        On September 17, 2007, the Company entered into a drilling program with Hoactzin for ten
        wells consisting of approximately three wildcat wells and seven developmental wells to be
        drilled on the Company&rsquo;s Kansas Properties (the &ldquo;Program&rdquo;). Under the
        terms of the Program, Hoactzin was to pay the Company $400,000 for each well in the Program
        completed as a producing well and $250,00 per drilled well that was non-productive. The
        terms of Program also provide that Hoactzin will receive all the working interest in the
        ten wells in the Program, but will pay an initial fee to the Company of 25% of its working
        interest revenues net of operating expenses. This is referred to as a management fee but as
        defined is in the nature of a net profits interest. The fee paid to the Company by Hoactzin
        will increase to 85% of working interest revenues when net revenues received by Hoactzin
        reach an agreed payout point of approximately 1.35 times Hoactzin&rsquo;s purchase price
        (the &ldquo;Payout Point&rdquo;). The Company intends to account for funds received for
        interests in the Program as an offset to oil and gas properties.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        The Company has drilled all ten wells in the Program. Of the ten wells drilled, nine were
        completed as oil producers and are currently producing approximately 106 barrels per day in
        total. Hoactzin paid a total of $3,850,000 for its interest in the Program resulting in the
        Payout Point being determined as $5,215,595. The amount paid by Hoactzin for its interest
        in the Program wells exceeded the Company&rsquo;s actual drilling costs of approximately
        $2.6 million for the ten wells by more than $1 million.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although production level of the Program wells will decline
        with time in accordance with expected decline curves for these types of well, based on the
        drilling results of the Program wells and the current price of oil, the Program wells are
        expected to reach the Payout Point in approximately four years solely from the oil revenues
        from the wells. However, under the terms of its agreement with Hoactzin reaching the Payout
        Point could be accelerated by the application of 75% of the net proceeds Hoactzin receives
        from the methane extraction project being developed by the Company&rsquo;s wholly-owned
        subsidiary, Manufactured Methane Corporation, at the Carter Valley, Tennessee landfill
        toward reaching the Payout Point. (The methane extraction project is discussed in greater
        detail below.) Those methane project proceeds when applied will result in the Payout Point
        being achieved sooner than the estimated four year period based solely upon revenues from
        the Program wells.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On October 24, 2006 the Company signed a twenty-year Landfill
        Gas Sale and Purchase Agreement (the &ldquo;Agreement&rdquo;) with BFI Waste Systems of
        Tennessee, LLC (&ldquo;BFI&rdquo;), an affiliate of Allied Waste Industrial. The Agreement
        was thereafter assigned to the Company&rsquo;s wholly-owned subsidiary, Manufactured
        Methane Corporation (&ldquo;MMC&rdquo;) and provides that MMC will purchase all the
        naturally produced gas stream presently being collected and flared at the municipal solid
        waste landfill in Carter Valley serving the metropolitan area of Kingsport, Tennessee that
        is owned and operated by BFI in Church Hill, Tennessee. BFI&rsquo;s facility is located
        about two miles from the Company&rsquo;s existing pipeline serving Eastman Chemical Company
        (&ldquo;Eastman&rdquo;). Contingent upon obtaining suitable financing, the Company plans to
        acquire and install a proprietary combination of advanced gas treatment technology to
        extract the methane component of the purchased gas stream.&nbsp; Methane is the principal
        component of natural gas and makes up about half of the purchased gas stream by volume. The
        Company plans to construct a small diameter pipeline to deliver the extracted methane gas
        to the Company&rsquo;s existing pipeline for delivery to Eastman (the &ldquo;Methane
        Project&rdquo;).<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;MMC has placed equipment orders for its first stage of
        process equipment (cleanup and carbon dioxide removal) and the second stage of process
        equipment (nitrogen rejection) for the Methane Project. It is anticipated that the total
        costs for the Project including pipeline construction, will be approximately $4.1 million
        including costs for compression and interstage controls. The costs of the Methane Project
        to date have been funded primarily by (a) the money received by the Company from Hoactzin
        to purchase its interest in the Ten Well Program which exceeded the Company&rsquo;s actual
        costs of drilling the wells in that Program by more than $1 million (b) cash flow from the
        Company&rsquo;s operations in the amount of approximately $1 million and (c) $825,000 of
        the funds the Company borrowed from its credit facility with Sovereign Bank. The Company
        anticipates that most of the remaining balance of the Methane Project costs will be paid
        from the Company&rsquo;s cash flow.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company anticipates that the equipment ordered by MMC
        will be manufactured and delivered to allow operations to begin in mid-2008 after equipment
        installation, testing, and startup procedures are begun. Commercial deliveries of gas will
        begin when the equipment is installed and tested, the pipeline is constructed and emission
        permits are obtained. Upon commencement of operations, the methane gas produced by the
        project facilities will be mixed in the Company&rsquo;s pipeline and delivered and sold to
        Eastman Chemical Company (&ldquo;Eastman&rdquo;) under the terms of the Company&rsquo;s
        existing natural gas purchase and sale agreement. At current gas production rates and
        expected extraction efficiencies, when commercial operations of the Project begin, the
        Company would expect to deliver about 418 MMBtu per day of additional gas to Eastman, which
        would substantially increase the current volumes of natural gas being delivered to Eastman
        by the Company from its Swan Creek field. At an assumed sales price of gas of $7 per MMBtu,
        near the average natural gas price received by the Company in 2007, the anticipated net
        revenues would be approximately $800,000 per year from the Methane Project based on
        anticipated volumes and expenses. The gas supply from this project is projected to grow
        over the years as the underlying operating landfill continues to expand and generate
        additional naturally produced gas, and for several years following the closing of the
        landfill, currently estimated by BFI to occur between the years 2022 and 2026.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As part of the Methane Project agreement, the Company agreed
        to install a new force-main water drainage line for BFI, the landfill owner, in the same
        two-mile pipeline trench as the gas pipeline needed for the project, reducing overall costs
        and avoiding environmental effects to private landowners resulting from multiple
        installations of pipeline. BFI will pay the additional costs for including the water line.
        Construction of the gas pipeline needed to connect the facility with the Company&rsquo;s
        existing natural gas pipeline began in January 2008. As a certificated utility, the
        Company&rsquo;s pipeline subsidiary, TPC, requires no additional permits for the gas
        pipeline construction. The Company currently anticipates that pipeline construction will be
        concluded approximately the same time as equipment deliveries and installations occur or in
        the May to June 2008 time period, subject to weather delays during wintertime
        construction.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 36px" align="justify">
        On September 17, 2007, Hoactzin, simultaneously with subscribing to participate in the Ten
        Well Program, pursuant to a separate agreement with the Company was conveyed a 75% net
        profits interest in the Methane Project. When the Methane Project comes online, the
        revenues from the Project received by Hoactzin will be applied towards the determination of
        the Payout Point (as defined above) for the Ten Well Program. When the Payout Point is
        reached from either the revenues from the wells drilled in the Program or the Methane
        Project or a combination thereof, Hoactzin&rsquo;s net profits interest in the Methane
        Project will decrease to a 7.5% net profits interest. The Company believes that the
        application of revenues from the Methane Project to reach the Payout Point could accelerate
        reaching the Payout Point. As stated above, the price paid by Hoactzin for its interest in
        the Program exceeded the Company&rsquo;s anticipated and actual costs of drilling the ten
        wells in the Program. Those excess funds provided by Hoactzin were used to pay for
        approximately $1,000,000 of equipment required for the Methane Project, or about 25% of the
        Project&rsquo;s capital costs. The availability of the funds provided by Hoactzin
        eliminated the need for the Company to borrow those funds, to have to pay interest to any
        lending institution making such loans or to dedicate Company revenues or revenues from the
        Methane Project to pay such debt service. Accordingly, the grant of a 7.5% interest in the
        Methane Project to Hoactzin was negotiated by the Company as a favorable element to the
        Company of the overall transaction.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company also announced that on September 17, 2007 it
        entered into an additional agreement with Hoactzin providing that if the Ten Well Program
        and the Methane Project interest in combination failed to return net revenues to Hoactzin
        equal to 25% of the purchase price it paid for its interest in the Ten Well Program (the
        &ldquo;Purchase Price&rdquo;) by December 31, 2009, then Hoactzin has an option to exchange
        up to 20% of its net profits interest in the Methane Project for convertible preferred
        stock to be issued by the Company with a liquidation value equal to 20% of the Purchase
        Price less the net proceeds received at the time of any exchange. The conversion option
        would be set at issuance of the preferred stock at the then twenty business day trailing
        average closing price of Company stock on the American Stock Exchange. Hoactzin has a
        similar option each year after 2009 in which Hoactzin&rsquo;s then-unrecovered Purchase
        Price at the beginning of the year is not reduced 20% further by the end of that year,
        using the same conversion option calculation at date of the subsequent year&rsquo;s
        issuance if any. The Company, however, may in any year make a cash payment from any source
        in the amount required to prevent such an exchange option for preferred stock from arising.
        In addition, the conversion right is limited to no more than 19% of the outstanding common
        shares of the Company. In the event Hoactzin&rsquo;s 75% net profits interest in the
        Methane Project were fully exchanged for preferred stock, by definition the reduction of
        that 75% interest to a 7.5% net profits interest that was agreed to occur upon the receipt
        of 1.3547 of the Purchase Price by Hoactzin could not happen because the larger percentage
        interest then exchanged, no longer exists to be reduced. Accordingly, Hoactzin would retain
        no net profits interest in the Methane Project after a full exchange of Hoactzin&rsquo;s
        75% net profits interest for preferred stock.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under this exchange agreement, if no proceeds at all were
        received by Hoactzin through 2009 or in any year thereafter (i.e. a worst-case scenario
        already impossible in view of the success of the Ten Well Program), then Hoactzin would
        have an option to exchange 20% of its interest in the Methane Project in 2010 and each year
        thereafter for preferred stock with liquidation value of 100% of the Purchase Price (not
        135%) convertible at the trailing average price before each year&rsquo;s issuance of the
        preferred. The maximum number of common shares into which all such preferred could be
        converted cannot be calculated given the formulaic determination of conversion price based
        on future stock price. However, assuming for purposes of a calculation example only, a
        uniform stock price of $.75 per share, the preferred stock would be convertible (at
        investment $3.7 million for eight of ten producing wells) or 4.93 million common shares,
        approximately 8.35% of the Company&rsquo;s currently outstanding shares.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;However, the Company anticipates that with the demonstrated
        successful results of the Ten Well Program that the payout of 25% of the Purchase Price
        will be reached by December 31, 2009 and no requirement to issue preferred stock will arise
        in 2010. The Company further anticipates that at current oil and gas prices, and at
        currently expected sales levels of methane gas from the Methane Project to come online in
        2008, that the balance of the unrecovered Purchase Price by Hoactzin will also be reduced
        by at least 20% each year thereafter. Based only on current production from the nine
        producing wells in the Ten Well Program (i.e. not considering any revenue contribution from
        the Methane Project), expected decline curves for production, and using current oil prices,
        the Company expects that by December 2009, Hoactzin will have received approximately 66% of
        the Purchase Price, far in excess of the 25% required in order to obviate any occasion to
        exchange its interest in the Methane Project for preferred stock. As a result, the Company
        believes it is highly unlikely that any obligation to issue preferred stock will arise
        under the terms of this agreement at any time in the future.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On December 18, 2007, the
        Company entered into a Management Agreement with Hoactzin. On that same date, the Company
        also entered into an agreement with Charles Patrick McInturff employing him as a
        Vice-President of the Company. Pursuant to the Management Agreement with Hoactzin, Mr.
        McInturff&rsquo;s duties while he is employed as Vice-President of the Company will include
        the management on behalf of Hoactzin of its working interests in certain oil and gas
        properties owned by Hoactzin and located in the onshore Texas Gulf Coast, and offshore
        Texas and offshore Louisiana. As consideration for the Company entering into the Management
        Agreement, Hoactzin has agreed that it will be responsible to reimburse the Company for the
        payment of one-half of Mr. McInturff&rsquo;s salary, as well as certain other benefits he
        receives during his employment by the Company. In further consideration for the
        Company&rsquo;s agreement to enter into the Management Agreement, Hoactzin has granted to
        the Company an option to participate in up to a 15% working interest for a corresponding
        price of up to 15% of the actual project costs, in any new drilling or work-over activities
        undertaken on Hoactzin&rsquo;s managed properties during the term of the Management
        Agreement. The term of the Management Agreement is the earlier of the date Hoactzin sells
        its interests in its managed properties or 5 years.<br>
        <br>
        &nbsp;</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b> <b><u>Review, Approval
        or Ratification of Transactions with Related Parties</u></b><b><sup>21</sup></b></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company&rsquo;s Board of
        Directors has adopted a written Related Party Transactions Approval Policy which is posted
        on the Company&rsquo;s website at www.tengasco.com. It is the Company&rsquo;s preference to
        avoid entering into a material related-party transaction if a transaction with a
        non-related party is available on an equally timely and equally beneficial basis. However,
        if a Related Party Transaction appears to be in the Company&rsquo;s best interest then it
        will be approved or ratified if the Board of Directors expressly finds that the terms of
        the transaction are comparable to or more beneficial to the Company than those that could
        be obtained in arm&rsquo;s length dealings with an unrelated third party; or, the
        transaction is approved by the majority of disinterested members of the Company&rsquo;s
        Board of Directors.</p>

        <p></p>

        <p></p>

        <p style="FONT-SIZE: 12pt; MARGIN: 0pt 0.3in 0pt 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b> <b><u>Parent Of Issuer</u></b><br>
        &nbsp;</p>

        <p style="MARGIN: 0pt 0.3in 0pt 0in; TEXT-INDENT: 72px" align="justify">The Company has no
        parent.</p>

        <p></p>
        <!-- PAGE BREAK  --><!-- EEDocs PBStart-->
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        <p style="PAGE-BREAK-AFTER: always"></p>
        <!-- EEDocs PBEnd-->

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>BOARD RECOMMENDATION AND VOTE REQUIRED</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For Proposal No. 1 regarding the election of directors, votes
        may be cast in favor of all nominees, may be withheld with regard to all nominees or may be
        withheld only with regard to nominees specified by the stockholder. Directors will be
        elected by a plurality of the votes of the shares of the Company's common stock present in
        person or represented by proxy, and entitled to vote on the election of directors at a
        meeting at which a quorum is present. Abstentions are tabulated in determining the votes
        present at a meeting. Consequently, an abstention has the same effect as a vote against a
        director-nominee, as each abstention would be one less vote in favor of a director nominee.
        If a broker indicates on the proxy that it does not have discretionary authority as to
        certain shares to vote on a particular matter (i.e., a &ldquo;broker non-vote&rdquo;),
        those shares will not be considered as present and entitled to vote with respect to that
        matter. The Board of Directors recommends that stockholders vote "FOR" the nominees set
        forth above. Unless marked to the contrary, proxies received will be voted FOR the nominees
        set forth above.</p>

        <p></p>
        <!-- PAGE BREAK  --><!-- EEDocs PBStart-->
        <hr align="center" width="100%" noshade size="2">

        <p style="PAGE-BREAK-AFTER: always"></p>
        <!-- EEDocs PBEnd-->

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>PROPOSAL NO. 2<br>
        &nbsp;<br>
         APPROVAL OF AMENDMENTS TO THE TENGASCO, INC.<br>
        STOCK INCENTIVE PLAN TO (i) INCREASE THE<br>
        NUMBER OF SHARES THAT MAY BE ISSUED UNDER<br>
        THE PLAN AND (ii) EXTEND THE TERM OF THE PLAN</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors of the Company on October 25, 2000
        adopted the Tengasco, Inc. Stock Incentive Plan (the &ldquo;Plan&rdquo;) to provide an
        incentive to key employees, officers, directors and consultants of the Company and its
        present and future subsidiary corporations, and to offer an additional inducement in
        obtaining the services of such individuals. The plan was approved by the Company&rsquo;s
        shareholders on June 26, 2001. The Plan provides for the grant to employees of the Company
        of "Incentive Stock Options," within the meaning of Section 422 of the Internal Revenue
        Code of 1986, as amended (the "Code"), Nonqualified Stock Options to outside Directors and
        consultants to the Company and stock appreciation rights ("SARs").<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On May 19, 2005, the Board of Directors, upon recommendation
        of the Compensation/Stock Option Committee approved an amendment to the Plan which provided
        for the increase of the aggregate number of shares of common stock that may be issued under
        the Plan from 1,000,000 shares to 3,500,000 shares. All other terms of the Plan remain
        unchanged. This Amendment was approved by the Company&rsquo;s shareholders on July 19,
        2005.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of December 31, 2007, there were outstanding options to
        purchase 2,441,000 shares granted under the Plan and only 39,638 shares remaining available
        for issuance for options and stock appreciation rights to be granted under the Plan. All
        options granted under the Plan were granted at an exercise price at least equal to the
        market price of the Common Stock on the date of the grant of such options. The Stock
        Option/Compensation had advised the Board of its desire to recommend, subject to
        shareholder approval to amend the Plan, further grants of options under the Plan to
        Directors, officers and employees of the Company whose performance in the Committee&rsquo;s
        discretion warrant the award of such options. Awards made pursuant to the Plan are an
        integral and critical part of the Company&rsquo;s overall compensation policy for its
        officers and employees and also provides the Company with greater flexibility and methods
        in compensating its Directors and consultants. As a result, on February 1, 2008, the Board
        adopted amendments to the Plan to increase the number of shares of common stock that may be
        issued under the Plan by an additional 3,500,000 shares and to also increase the term of
        the Plan which is scheduled to terminate on October 24, 2010 for an additional ten years to
        October 24, 2020.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Because the number of shares under the Plan as it presently
        exists are not sufficient to cover future options and/or stock appreciation rights to be
        awarded and the Plan is scheduled to terminate in a little over two years, at the Annual
        Meeting, the shareholders will be asked to approve the amendments to the Plan. Shareholder
        approval of the proposed amendments are required pursuant to the terms of the Plan and the
        rules and policies of the American Stock Exchange. The purpose of these amendment to the
        Plan are to insure the continuation of the Plan which will provide the Company with a
        greater ability to attract and retain qualified individuals as employees, consultants,
        officers and directors by the granting of options and stock appreciations rights. In order
        to attract and retain such individuals the Company needs to be in a position to offer
        options to acquire shares of the Company&rsquo;s common stock in excess of the present
        share maximum under the current Plan.<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following summary description of the principal terms of
        the Plan, does not purport to be complete and is qualified in its entirety by the full text
        of the Plan, as amended, a copy of which may be obtained without cost upon written request
        to the Secretary of the Company.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>TERMS OF THE PLAN</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Administration</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan is administered by the Compensation/Stock Option
        Committee (the &ldquo;Committee&rdquo;) which is appointed by the Company&rsquo;s Board of
        Directors.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Eligibility</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan provides for the grant to employees of the Company
        of "Incentive Stock Options," within the meaning of Section 422 of the Internal Revenue
        Code of 1986, as amended (the "Code"), Nonqualified Stock Options to outside Directors and
        consultants to the Company and stock appreciation rights ("SARs"). The Plan is open to
        participation by any person or entity that renders bona fide services to the Company,
        including, without limitation, (i) a person employed by the Company in a key capacity; (ii)
        an officer or director (including advisory or other directors) of the Company; and (iii) a
        person or company engaged by the Company as a consultant or advisor.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In determining the persons to whom Options or SARs shall be
        granted (hereinafter an individual who receives a grant of an Option or SAR is referred to
        as the &ldquo;Recipient&rdquo;) and the number of shares to be covered by each Option or
        SAR, the Committee takes into account the duties of the respective persons, their past,
        present and potential contributions to the success of the Company, and such other factors
        as the Committee shall deem relevant to accomplish the purposes of the Plan.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A Recipient shall be eligible to receive more than one grant
        of an Option or SAR during the term of the Plan.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Without amending the Plan, the Board of Directors may grant
        Options and SARs under the Plan to employees of the Company who are foreign nationals or
        employed outside the United States, or both, on such terms and conditions different from
        those specified in the Plan but consistent with the purpose of the Plan, as it deems
        necessary and desirable to create equitable opportunities given differences in tax laws of
        other countries.<br>
        &nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Termination of the Plan and Amendment</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As presently in effect, no options may be granted under the
        Plan after October 24, 2010. The Plan may be amended consistent with applicable laws and
        regulations, suspended or terminated at any time by the Committee. The Committee may
        decrease the number of shares subject to the Plan and may increase such number but only as
        a consequence of a stock split, reorganization, merger, recapitalization or other change in
        the corporate structure of the Company affecting all shares of Common Stock, as more
        specifically explained in the Plan. No termination or amendment of the Plan shall, without
        the consent of the Recipient of an existing Option or SAR, adversely affect his rights
        under such Option or SAR.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Grant of Options and SARs</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each option or SAR granted under the Plan shall be evidenced
        by a written agreement (the &ldquo;Agreement&rdquo;) between the Company and the Recipient
        which shall state the number of shares covered by the option or SAR; the exercise price for
        the option or the base price for the SAR; and, the period during and times at which the
        option or SAR shall be exercisable. The Fair Market Value of the Company&rsquo;s Common
        Stock on the date such Option and SAR is granted shall be the closing price per share of
        Common Stock on the American Stock Exchange on that day or if the Common Stock is not
        listed on a national securities exchange it shall be determined by the Committee.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purchase price of a Nonqualified Stock Option may not be
        less than 85% of the Fair Market Value of shares of Common Stock underlying such option and
        the Committee and the Recipient shall also pay the full amount of any required Federal,
        state or local withholding tax. The Committee may permit the Recipient to pay the
        withholding tax by having the Company withhold Shares having a Fair Market Value at the
        time of exercise equal to the amount required to be withheld.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purchase price of an Incentive Stock Option may not be
        less than 100% of the Fair Market Value of shares of Common Stock underlying such option
        and must be exercisable within ten years from the date it was granted. The aggregate Fair
        Market Value of the shares of Common Stock underlying an Incentive Stock Option which are
        exercisable during any calendar year during the term of such Option shall not exceed
        $100,000.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purchase price of any Incentive Stock Option granted to
        any Employee of the Company who owns more than 10% of the total combined voting power of
        all classes of stock of the Company shall be 110% of the Fair Market Value of the shares of
        Common Stock underlying such option on the date it is granted and such option must be
        exercisable within 5 years from the date it was granted.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event any Option granted as an Incentive Stock Option
        fails to conform to the applicable requirements, it shall be treated and honored by the
        Company as a Nonqualified Stock Option.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;An SAR may be granted separately, in tandem with or in
        addition to any option, and may be granted before, simultaneously with or after the grant
        of an option hereunder.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company may, in its sole discretion and without the
        consent of the Recipient, elect at any time to convert any Option granted under the Plan to
        a SAR. In the event of such an election, any converted SAR shall remain in effect until the
        Option involved would have expired under the terms of the Agreement with the Recipient. The
        value of such a SAR shall be determined using the Fair Market Value of the Shares subject
        to the Option on the date the Option was first granted. Notice of such an election shall be
        provided to the Recipient as soon as feasible after the date of the election.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Exercise of Option or SAR<br>
        &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b> Upon the exercise of an Option<b>,</b> payment of the
        option purchase price shall be paid in full unless the Agreement permits installment
        payments. The purchase price for the option shall be paid in cash, or in shares of Common
        Stock having a Fair Market Value equal to such option price, or in property or in a
        combination of cash shares and property and, subject to approval of the Committee, may be
        effected in whole or in part with funds received from the Company at the time of exercise
        as a compensatory cash payment.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon the exercise of an SAR, the Committee shall issue to the
        Recipient either (1) Shares of Common Stock based on the Fair Market Value on the date of
        payment (with any fractional Shares to be paid in cash), (2) cash or (3) a combination of
        Shares and cash, equal in value to the amount payable under the SAR. Any cash payment to be
        made by the Company may, as determined by the Committee in its sole discretion, be payable
        in installments over a period of no more than 6 months.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Termination of Association with the Company</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event a Recipient ceases to be an employee or Director
        of, or consultant to, the Company (other than for reasons of disability retirement or
        death) all Options and SARs granted to the Recipient prior to the date of termination may
        be exercised at any time within three months after the date of termination, but in no event
        after the term of the Option or SAR if it expires prior to the end of that three month
        period. In the event a Recipient&rsquo;s employment, consulting or other relationship is
        terminated for cause, all Options and SARs previously granted to such Recipient to the
        extent not previously exercised will terminate immediately.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Death, Disability or Retirement</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If a Recipient retires or dies while he is associated with
        the Company or whose association with the Company is terminated by reason of a permanent
        and total disability (as defined in Section 22(e) (3) of the Code), any option or SAR
        granted to the Recipient may be exercised by the Recipient or by the Recipient&rsquo;s
        estate or by a person who acquired the right to exercise such options or SARs by reason of
        the death or Disability of the Recipient, at any time within one year after the date of
        death, disability or retirement of the Recipient unless the term of the Option or SAR
        expires prior to that time; provided, however, that in the case of an Incentive Stock
        Option such one-year period shall be limited to three months in the case of retirement.<br>
        &nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Laws and Regulations</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The obligation of the Company to issue and deliver shares
        following the exercise of an Option or payment upon the exercise of an SAR under the Plan
        shall be subject to the condition that the Company be satisfied that the sale and delivery
        thereof will not violate any Federal or state securities laws or any other applicable laws,
        rules or regulations.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discretion as to Awards</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee shall have absolute discretion to determine
        when and to whom grants of Options or SARs under the Plan are to be made, and the number of
        shares and exercise prices to be awarded. No person shall have any tacit or other right to
        an award of an Option or SAR unless and until an explicit award under the Plan has been
        made.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nature of the Plan</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan is strictly compensatory in nature and is not in the
        nature of savings, dividend reinvestment, profit-sharing or pension plan. Accordingly, the
        Plan has no assets or funds to be administrated or invested by its administrators. Please
        note that participants do not and will not own any interest of any kind in the Plan
        itself.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>Tax Matters</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ERISA Applicability</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan, the award shares and option shares issuable
        thereunder, are not subject to the Employee Retirement Income Security Act of 1974, as
        amended.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal Income Tax Consequences<br>
        &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Recipients<br>
        &nbsp;</b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 36px" align="justify">
        <b>Options</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Options granted under the Plan may be either Nonqualified
        Stock Options or Incentive Stock Options qualifying under Section 422A of the Code.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<i>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nonqualified
        Stock Options</i><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A Recipient is not subject to Federal income tax upon the
        grant of a Nonqualified Stock Option. At the time of exercise, the Recipient will realize
        compensation income (subject to withholding) to the extent that the then Fair Market Value
        of the Option Shares exceeds the purchase price of the Option. The amount of such income
        will constitute an addition to the Recipient&rsquo;s tax basis in the Option Shares. Sale
        of the Shares will result in capital gain or loss (long-term or short-term) depending on
        the Recipient&rsquo;s holding period. The Company is entitled to a Federal tax deduction at
        the same time and to the same extent that the Recipient realizes compensation income.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<i>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Incentive
        Stock Options<br>
        &nbsp;</i></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Options granted under the Plan denominated as Incentive Stock
        Options are intended to constitute incentive stock options under Section 422A of the Code.
        A Recipient is not subject to Federal income tax upon either the grant or exercise of an
        Incentive Stock Option. If the Recipient holds the shares acquired upon exercise for at
        least one year after issuance of the Option Shares and until at least two years after grant
        of the Option (the &ldquo;Requisite Holding Period&rdquo;), then the difference between the
        amount realized on a subsequent sale or other taxable disposition of the shares and the
        option price will constitute long-term capital gain or loss. To obtain favorable tax
        treatment, an Incentive Stock Option must be exercised within three months after
        termination of employment (other than by retirement, disability, or death) with the Company
        or a 50% subsidiary. To obtain favorable tax treatment, an Incentive Stock Option must be
        exercised within three months of retirement or within one year of cessation of employment
        for disability (with no limitation in the case of death), notwithstanding any longer
        exercise period permitted under the terms of the Plan. The Company will not be entitled to
        a Federal tax deduction with respect to the grant or exercise of the Incentive Stock
        Option.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the Recipient sells the Option Shares acquired under an
        Incentive Stock Option before the Requisite Holding Period, he or she will be deemed to
        have made a &ldquo;disqualifying disposition&rdquo; of the shares and will realize
        compensation income in the year of disposition equal to the lesser of the fair market value
        of the shares at exercise or the amount realized on their disposition over the option price
        of the shares. (However, if the disposition is by gift or by sale to a related party, the
        compensation income must be measured by the value of the shares at exercise over the option
        price.) Any gain recognized upon a disqualifying disposition in excess of the ordinary
        income portion will constitute either short-term or long-term capital gain. In the event of
        a disqualifying disposition, the Company will be entitled to a Federal tax deduction in the
        amount of the compensation income realized by the Recipient.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition to the federal income tax consequences described
        above, a Recipient may be subject to the alternative minimum tax, which is payable to the
        extent it exceeds the Recipient's regular tax. For this purpose, upon the exercise of an
        Incentive Stock Option, the excess of the Fair Market Value of the Option Shares over the
        exercise price for such shares is a tax preference item. In addition, the Recipient&rsquo;s
        basis in the Option Shares is increased by such amount for purposes of computing the gain
        or loss on the disposition of the shares for alternative minimum tax purposes. If a
        Recipient is required to pay an alternative minimum tax, the amount of such tax which is
        attributable to deferral preferences (including the incentive stock option preference) is
        allowed as a credit against the Recipient's regular tax liability in subsequent years. To
        the extent the credit is not used, it is carried forward.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SARs&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SARs may be awarded with respect to both Incentive Stock
        Options and Nonqualified Stock Options under the Plan. A Recipient is not taxed upon the
        grant of an SAR. A Recipient exercising an SAR for cash will realize compensation income
        (subject to withholding) in the amount of the cash received. The Company is entitled to a
        tax deduction at the same time and to the same extent that the Recipient realizes
        compensation income.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>The Company</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The grant and exercise of Incentive Stock Options and
        Nonqualified Stock Options under the Plan generally have no direct tax consequences to the
        Company. The Company generally will be entitled to a compensation deduction with respect to
        any ordinary income recognized by a Recipient including income that results from the
        exercise of a Nonqualified Stock Option, SAR or a disqualifying disposition of an Incentive
        Stock Option. Any such deduction will be subject to the limitations of Section 162(m) of
        the Code which generally disallows a public company&rsquo;s tax deduction for compensation
        to covered employees in excess of $1 million in any tax year beginning on or after January
        1, 2004. Compensation that qualifies as &ldquo;performance-based compensation&rdquo; is
        excluded from the $1 million deductibility cap, and therefore remains fully deductible by
        the company that pays it. The Company believes that the options and SAR&rsquo;s it grants
        under the Plan will be considered &ldquo;performance-based&rdquo; and not subject to the
        deduction limitations of Section 162(m). Future changes in Section 162(m) or the
        regulations thereunder may adversely affect the Company&rsquo;s ability to ensure that
        grants under the Plan will qualify as &ldquo;performance-based compensation&rdquo; that is
        fully deductible by the Company.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The foregoing is only a summary of the effect of federal
        income taxation upon the Recipient and the Company with respect to grants under the Plan.
        It does not purport to be complete and does not discuss, among other things, the tax
        consequences arising in the event of a Recipient&rsquo;s death or the income tax laws of
        the municipality or state under which the Recipient&rsquo;s income may be taxable.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>NEW PLAN BENEFITS</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other than the options previously granted under the Plan as
        set forth above, any future grants under the Plan are subject to the discretion of the
        Committee and therefore, are not determinable at this time. Each grant of an Incentive
        Stock Option will be made at fair market value on the date of the grant; the Company
        expects that each award other than an Incentive Stock Option will be made with an exercise
        price at or near the market value of the Company&rsquo;s Common Stock on the day of grant.
        The value of each such grant depends on the fair market value of the Company&rsquo;s Common
        Stock on the day of exercise and therefore, can not be determined or estimated at this
        time. Since neither future grants or the value of such grants under the Plan can be
        determined at this time a new benefits table, as described in the federal proxy rules, is
        not provided.<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>EQUITY COMPENSATION PLAN INFORMATION</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table provides information regarding the number
        of shares of Common Stock that were subject to outstanding stock options or other
        compensation plan grants and awards at the end of Fiscal 2007.</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>

        <p></p>

        <table cellspacing="0" cellpadding="0" width="600" border="0">
            <tr>
                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Plan Category</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Number of securities</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    to be issued upon<br>
                    exercise of<br>
                    outstanding options,<br>
                    warrants and rights<br>
                    &nbsp;<br>
                    &nbsp;<br>
                    &nbsp;</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    (a)</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Weighted-average</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    exercise price of<br>
                    outstanding, options,<br>
                    warrants and rights<br>
                    &nbsp;<br>
                    &nbsp;<br>
                    &nbsp;<br>
                    &nbsp;</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    (b)</p>
                </td>

                <td style="BORDER-RIGHT: #000000 0.8pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Number of securities</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    remaining available<br>
                    for future issuance<br>
                    under equity<br>
                    compensation plans<br>
                    (excluding securities<br>
                    reflected in column<br>
                    (a))</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    (c)</p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Equity compensation</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    plans approved by</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    security holders</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    2,441,000</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    $0.30</p>
                </td>

                <td style="BORDER-RIGHT: #000000 0.8pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: #000000 0.8pt solid; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    39,368</p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Equity compensation</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    plans not approved</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    by security holders</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>

                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    0</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    N/A</p>
                </td>

                <td style="BORDER-RIGHT: #000000 0.8pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: medium none" valign="top" width="156">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    0</p>
                </td>
            </tr>

            <tr>
                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: #000000 0.8pt solid" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    Total</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: #000000 0.8pt solid" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    2,441,000</p>
                </td>

                <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: #000000 0.8pt solid; PADDING-TOP: 0in; BORDER-BOTTOM: #000000 0.8pt solid" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    $0.30</p>
                </td>

                <td style="BORDER-RIGHT: #000000 0.8pt solid; PADDING-RIGHT: 0.07in; BORDER-TOP: medium none; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: #000000 0.8pt solid" valign="top" width="156">
                    <p style="MARGIN-TOP: 5pt; MARGIN-BOTTOM: 2.6pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
                    39,368</p>
                </td>
            </tr>
        </table>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <b>BOARD RECOMMENDATION AND VOTE REQUIRED</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board deems approval of the amendment to the Plan to be
        in the best interests of the Company and therefore, recommends a vote FOR the amendments to
        the Plan. If a quorum is present at the annual meeting, the amendments to the Plan will be
        approved upon the affirmative vote by a majority of votes cast on the proposal, provided
        that the total votes cast on the proposal represents a majority of the shares entitled to
        vote on the proposal. Unless otherwise directed by the stockholder giving the proxy, the
        proxy will be voted for the approval of the amendments to the Plan. If a broker indicates
        on the proxy that it does not have discretionary authority as to certain shares to vote on
        a particular matter (i.e., a &ldquo;broker non-vote&rdquo;), those shares will not be
        considered as present and entitled to vote with respect to that matter. An abstention from
        voting by a stockholder present in person or by proxy at the meeting has the same legal
        effect as a vote "against" Proposal No. 2 because it represents a share present or
        represented at the meeting and entitled to vote, thereby increasing the number of
        affirmative votes required to approve this proposal.</p>

        <p></p>
        <!-- PAGE BREAK  --><!-- EEDocs PBStart-->
        <hr align="center" width="100%" noshade size="2">

        <p style="PAGE-BREAK-AFTER: always"></p>
        <!-- EEDocs PBEnd-->

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>PROPOSAL NO. 3</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>RATIFICATION OF SELECTION OF<br>
        RODEFER MOSS &amp; CO, PLLC AS INDEPENDENT AUDITORS</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has selected the firm of Rodefer Moss
        &amp; Co, PLLC (&ldquo;Rodefer Moss&rdquo;) of Knoxville, Tennessee, independent certified
        public accountants, to audit the accounts for the Company for fiscal year ending December
        31, 2008 ("Fiscal 2008"). Rodefer Moss has audited the Company's financial statements for
        the past three (3) fiscal years. The Company is advised that neither Rodefer Moss nor any
        of its partners has any material direct or indirect relationship with the Company. The
        Board of Directors considers Rodefer Moss to be well qualified for the function of serving
        as the Company's auditors. Tennessee Law does not require the approval of the selection of
        auditors by the Company's stockholders, but in view of the importance of the financial
        statement to stockholders, the Board of Directors deems it desirable that they pass upon
        its selection of auditors. In the event the stockholders disapprove of the selection, the
        Board of Directors will consider the selection of other auditors.</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>AUDIT AND NON-AUDIT FEES</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b> The following table presents the fees for
        professional audit services rendered by the Company&rsquo;s current independent
        accountants, Rodefer Moss, for the audit of the Company&rsquo;s annual consolidated
        financial statements for the fiscal years ended December 31, 2007 and December 31, 2006,
        and fees for other services rendered by Rodefer Moss during those periods:<br>
        &nbsp;</p>

        <p></p>

        <table cellspacing="0" cellpadding="0" width="600" border="0">
            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u>Fee Category</u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u>Fiscal 2007</u></b></p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; FONT-WEIGHT: bold; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px; TEXT-DECORATION: underline" align="justify">
                    <b><u>Fiscal 2006</u></b></p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Audit Fees</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $102,400</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $98,400</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Audit-Related Fees</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $1,950</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $0</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Tax Fees</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $0</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $0</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    All Other Fees</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $0</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $0</p>
                </td>
            </tr>

            <tr>
                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    Total Fees</p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $104,350<br>
                    </p>
                </td>

                <td style="PADDING-RIGHT: 0.07in; PADDING-LEFT: 0.07in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="196">
                    <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
                    $98,400</p>
                </td>
            </tr>
        </table>
        <br>
        <br>


        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Audit fees include fees related to the services rendered in
        connection with the annual audit of the Company&rsquo;s consolidated financial statements,
        the quarterly reviews of the Company&rsquo;s quarterly reports on Form 10-Q and the reviews
        of and other services related to registration statements and other offering memoranda.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Audit-related fees are for assurance and related services by
        the principal accountants that are reasonably related to the performance of the audit or
        review of the Company&rsquo;s financial statements.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax Fees include (i) tax compliance, (ii) tax advice, (iii)
        tax planning and (iv) tax reporting.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All Other Fees includes fees for all other services provided
        by the principal accountants not covered in the other categories such as litigation
        support, etc.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All of the services for 2006 and 2007 were performed by the
        full-time, permanent employees of Rodefer Moss.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All of the 2007 services described above were approved by the
        Audit Committee pursuant to the SEC rule that requires audit committee pre-approval of
        audit and non-audit services provided by the Company&rsquo;s independent auditors. The
        Audit Committee considered whether the provisions of such services, including non-audit
        services, by Rodefer Moss were compatible with maintaining its independence and concluded
        they were.<br>
        &nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>BOARD RECOMMENDATION AND VOTE REQUIRED</b><br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors recommends that you vote in favor of
        the above proposal to ratify the appointment of Rodefer Moss &amp; Co, PLLC as independent
        auditors of the Company for Fiscal 2008. A representative of Rodefer Moss &amp; Co, PLLC is
        expected to be present at the Annual Meeting with the opportunity to make a statement if he
        desires to do so, and is expected to be available to respond to appropriate questions.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ratification will require the affirmative vote of a majority
        of the shares present and voting at the meeting in person or by proxy. In the event
        ratification is not provided, the Audit Committee and the Board of Directors will review
        the future selection of the Company's independent auditors.</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless otherwise directed by the stockholder giving the
        proxy, the proxy will be voted for the ratification of the selection by the Board of
        Directors of Rodefer Moss &amp; Co, PLLC as the Company's independent certified public
        accountants for Fiscal 2008. Shares voted as abstaining will count as votes cast. If a
        broker indicates on the proxy that it does not have discretionary authority as to certain
        shares to vote on a particular matter (i.e., a &ldquo;broker non-vote&rdquo;), those shares
        will not be considered as present and entitled to vote with respect to that matter. An
        abstention from voting by a stockholder present in person or by proxy at the meeting has
        the same legal effect as a vote "against" Proposal No. 3 because it represents a share
        present or represented at the meeting and entitled to vote, thereby increasing the number
        of affirmative votes required to approve this proposal.<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
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        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>STOCKHOLDERS' PROPOSALS</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposals of stockholders intended to be presented at the
        2008 annual meeting must be received in writing, by the Chief Executive Officer of the
        Company at its offices by December 26, 2008 in order to be considered for inclusion in the
        Company's proxy statement relating to that meeting.<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SEC rules and regulations provide that if the date of the
        Company's 2008 Annual Meeting is advanced or delayed more than 30 days from the date of the
        2007 Annual Meeting, stockholder proposals intended to be included in the proxy materials
        for the 2008 Annual Meeting must be received by the Company within a reasonable time before
        the Company begins to print and mail the proxy materials for the 2008 Annual Meeting. Upon
        determination by the Company that the date of the 2008 Annual Meeting will be advanced or
        delayed by more than 30 days from the date of the 2007 Annual Meeting, the Company will
        disclose such change in the earliest possible Quarterly Report on Form 10-Q.<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;By
        Order of the Board of Directors<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cary
        V. Sorensen, <i>Secretary<br>
        </i></p>
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        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>TENGASCO, INC.</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="center">
        <b>THIS PROXY IS SOLICITED ON BEHALF<br>
        OF THE BOARD OF DIRECTORS</b></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned hereby appoints Jeffrey R. Bailey and Cary V.
        Sorensen as proxies (the "Proxies"), each with power of substitution and re-substitution,
        to vote all shares of Common Stock, $.001 par value per share, of Tengasco, Inc. (the
        "Company") held of record by the undersigned on April 10, 2008 at the Annual Meeting of
        stockholders to be held at the Homewood Suites by Hilton, 10935 Turkey Drive, Knoxville,
        Tennessee, on Monday, June 2, 2008, at 9:00 A.M. local time, or at any adjournments
        thereof, as directed below, and in their discretion on all other matters coming before the
        meeting or any adjournments thereof.<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>Please mark boxes / / in blue or black ink.</b><br>
        &nbsp;<br>
        1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Election of Directors: Jeffrey R. Bailey, Matthew K.
        Behrent, John A. Clendening, Carlos P. Salas and Peter E. Salas.<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>(Mark only one of the two boxes for this item)</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 1in; TEXT-INDENT: -72px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/ /</b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;VOTE FOR all nominees
        named above except those who may be named on these two lines:</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____________________________________________________________&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>

        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____________________________________________________________&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>

        (OR)<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 1in; TEXT-INDENT: -72px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/ /</b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;VOTE WITHHELD as to
        all nominees named above.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        2. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposal to approve amendments to the Tengasco, Inc. Stock
        Incentive Plan to (i) increase the number of shares of common stock that may be issued
        under the Plan by 3,500,000 shares and (ii) extend the Term of the Plan for an additional
        ten years.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/
        /</b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AGAINST&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/
        /</b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ABSTAIN&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/ /</b><br>
        &nbsp;<br>
        3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposal to ratify appointment of Rodefer Moss &amp; Co,
        PLLC as the Company's independent certified public accountants for Fiscal 2007:<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/
        /</b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AGAINST&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/
        /</b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ABSTAIN&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b>/ /</b><br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: -36px" align="justify">
        4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In their discretion, the Proxies are authorized to vote
        upon such other business as may properly come before the meeting.</p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;When properly executed, this Proxy will be voted as directed.
        If no direction is made, this Proxy will be voted "FOR" Proposals 1, 2 and 3.<br>
        &nbsp;<br>
        &nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="justify">
        <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please mark, date, and sign and return this Proxy promptly
        in the enclosed envelope.<br>
        &nbsp;<br>
         &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please sign exactly as name appears hereon. When shares are
        held by joint tenants, both should sign. When signing as attorney or executor,
        administrator, trustee or guardian, please give your full title as such. If a corporation,
        please sign in full corporate name by president or other authorized officer. If a
        partnership, please sign in partnership name by authorized person.</b><br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dated:
        _______________________, 2008<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X
        ____________________________
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Signature<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X
        _____________________________<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Print
        Name(s)<br>
        &nbsp;<br>
        &nbsp;<br>
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;X
        ____________________________
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Signature,
        if held jointly<br>
        &nbsp;</p>

        <p></p>

        <p></p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>1</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless otherwise stated, all shares of Common
        Stock are directly held with sole voting and dispositive power.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>2</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 20,839,492 shares held directly by
        Dolphin Offshore Partners, L.P. (&ldquo;Dolphin&rdquo;) and 218,000 shares held directly by
        Peter E. Salas, and a vested, fully exercisable option to purchase 50,000 shares granted to
        Mr. Salas who is the Chairman of the Company&rsquo;s Board of Directors and is the sole
        shareholder and controlling person of Dolphin Management, Inc., the general partner of
        Dolphin.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>3</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under these categorical standards
        &ldquo;immediate family member&rdquo; includes a person&rsquo;s spouse, parents, children,
        siblings, mother-in-law, father-in-law, brother-in-law, sister-in-law, son-in-law,
        daughter-in-law, and anyone who resides in such person&rsquo;s home.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>4</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this categorical standard, an
        &ldquo;affiliated person of the Company&rdquo; means a person that directly, or indirectly
        through intermediaries controls, or is controlled by, or is under common control with the
        Company. A person will not be considered to be in control of the Company, and therefore not
        an affiliate of the Company, if he is not the beneficial owner, directly or indirectly of
        more than 10% of any class of voting securities of the Company and he is not an executive
        officer of the Company. Executive officers of an affiliate of the Company as well as a
        director who is also an employee of an affiliate of the Company will be deemed to be
        affiliates of the Company.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>5</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless otherwise stated, all shares of common
        stock are directly held with sole voting and dispositive power. The shares set forth in the
        table are as of April 10, 2008.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>6</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Calculated pursuant to Rule 13d-3(d) under the
        Securities Exchange Act of 1934 based upon 59,158,750 shares of common stock being
        outstanding as of the record date, April 10, 2008. Shares not outstanding that are subject
        to options or warrants exercisable by the holder thereof within 60 days of April 10, 2008
        are deemed outstanding for the purposes of calculating the number and percentage owned by
        such stockholder, but not deemed outstanding for the purpose of calculating the percentage
        of any other person. Unless otherwise noted, all shares listed as beneficially owned by a
        stockholder are actually outststanding. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>7</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 136,287 shares held directly and
        vested, fully exercisable options to purchase 790,000 shares.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>8</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 355,500 shares held directly and
        vested, fully exercisable options to purchase 20,000 shares.
        &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>9</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 5,500 shares held directly and
        vested, fully exercisable options to purchase 100,000 shares.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>10</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 218,000 shares held directly,
        vested, fully exercisable options to purchase 50,000 shares and 20,839,492 shares held
        directly by Dolphin Offshore Partners, L.P. (&ldquo;Dolphin&rdquo;). Peter E. Salas is the
        sole shareholder of and controlling person of Dolphin Management, Inc. which is the general
        partner of Dolphin.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>11</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 60,100 shares held directly and
        vested, fully exercisable options to purchase 255,000 shares.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>12</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 40,000 shares held directly and
        vested, fully exercisable options to purchase 255,000 shares.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>13</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of vested, fully exercisable options
        to purchase 100,000 shares.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>14</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consists of 815,387 shares held directly by
        management, 20,839,492 shares held by Dolphin and vested, fully exercisable options to
        purchase 1,550,000 shares</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>15</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The amounts represented in this column are
        equal to the dollar amount recognized for financial statement reporting purposes in
        connection with options granted under the Tengasco, Inc. Stock Incentive Plan. See Note 11
        to the Consolidated Financial Statements included in the Company&rsquo;s Annual Report on
        Form 10-K for the year ended December 31, 2007 for a discussion of the relevant assumptions
        used in calculating the dollar amount recognized for financial reporting purposes with
        respect to the applicable fiscal year in accordance with FAS 123R.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>16</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mr. Bailey is also a member of the Board of
        Directors of the Company. In 2006 he was awarded an option pursuant to the Tengasco, Inc.
        Stock Incentive Plan to purchase 20,000 shares of the Company&rsquo;s common stock at a
        price of $0.81 per share for his services as a director.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>17</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All options awarded reflected in this table
        were granted pursuant to the Tengasco, Inc. Stock Incentive Plan.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>18</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Option awarded in 2005 to purchase 1,250,000
        shares of the Company&rsquo;s common stock vests over a period of four years with 20%
        vested upon authorization and additional 20% on each anniversary date of authorization over
        the next four years. As of December 31, 2007 the right to purchase 750,000 shares was fully
        vested and exercisable.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>19</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Option awarded in 2005 to purchase 400,000
        shares of the Company&rsquo;s common stock vests over a period of four years with 20%
        vested upon authorization and additional 20% on each anniversary date of authorization over
        the next four years. As of December 31, 2007 the right to purchase 240,000 shares was fully
        vested and exercisable.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 10pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0px" align="left">
        <sup>20</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Option awarded in 2005 to purchase 400,000
        shares of the Company&rsquo;s common stock vests over a period of fours years with 20%
        vested upon authorization and additional 20% on each anniversary date of authorization over
        the next four years. As of December 31, 2007 the right to purchase 240,000 shares was fully
        vested and exercisable.</p>

        <p style="MARGIN-TOP: 0pt; FONT-SIZE: 12pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.3in; TEXT-INDENT: -13px" align="justify">
        <sup>21</sup> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<font style="FONT-SIZE: 10pt">A &ldquo;Related
        Party&rdquo; is any director or executive officer of the Company, any nominee for director,
        any shareholder known to be the beneficial owner of more than 5% of any class of the
        Company&rsquo;s voting stock, and any Immediate Family Member of any such Party.
        &ldquo;Immediate Family Member&rdquo; means any child, stepchild, parent, stepparent,
        spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law
        or sister-in-law of a person, and any person (other than a tenant or an employee) sharing
        the household of such person.</font></p>

        <p></p>

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