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Agreement and Plan of Merger

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Title:

Agreement and Plan of Merger

Entities:

BREK Energy Corp.; Chase Manhattan Bank; Gasco Energy, Inc.

Date:

2006

Size:

169KB total

Price:

$53

ID:

#2518825

► Plans ► Agreements ► Agreements & Plans of Merger
► Energy ► Oil & Gas Operations
► Financial
► Financial ► Consumer Financial Services

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AGREEMENT AND PLAN OF MERGER

By and Among

GASCO ENERGY, INC. (Parent),

GASCO ACQUISITION, INC. (Merger Sub)

and

BREK ENERGY CORPORATION (Company)

Dated as of September 20, 2006

Page - 2

TABLE OF CONTENTS

ARTICLE I THE MERGER

1.1

The Merger

1.2

Effective Time of the Merger

1.3

Tax Treatment

ARTICLE II THE SURVIVING CORPORATION

2.1

Articles of Incorporation

2.2

Bylaws

2.3

Directors and Officers

ARTICLE III CONVERSION OF SHARES

3.1

Conversion of Capital Stock

3.2

Dissenting Shares

3.3

Surrender and Exchange

3.4

Stock Options

3.5

Warrants

3.6

No Fractional Shares

3.7

Closing

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF COMPANY

4.1

Organization and Qualification

4.2

Capitalization

4.3

Authority

4.4

Consents and Approvals; No Violation

4.5

Company SEC Reports

4.6

Company Financial Statements

4.7

Material Agreements

4.8

Absence of Undisclosed Liabilities

4.9

Absence of Certain Changes

4.10

Taxes

4.11

Litigation

4.12

Employee Benefit Plans; ERISA

4.13

Environmental Liability

4.14

Compliance with Applicable Laws

4.15

Insurance

4.16

Labor Matters; Employees

4.17

Permits

4.18

Properties

4.19

Reserve Report

4.20

Operations; Equipment

4.21

Prepayments; Hedging; Calls

4.22

Restrictive Agreements

4.23

Required Shareholder Vote or Consent

4.24

Proxy Statement/Prospectus; Registration Statement

4.25

Brokers

4.26

Tax Matters

4.27

Opinion of Financial Advisor

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ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

5.1

Organization and Qualification

5.2

Capitalization

5.3

Authority

5.4

Consents and Approvals; No Violation

5.5

Parent SEC Reports

5.6

Parent Financial Statements

5.7

Absence of Undisclosed Liabilities

5.8

Absence of Certain Changes

5.9

Proxy Statement/Prospectus; Registration Statement

5.10

Brokers

5.11

Tax Matters

ARTICLE VI CONDUCT OF BUSINESS PENDING THE MERGER

6.1

Conduct of Business by Company Pending the Merger

6.2

Conduct of Business by Parent Pending the Merger

ARTICLE VII ADDITIONAL AGREEMENTS

7.1

Access and Information

7.2

No Solicitation of Transactions

7.3

Subsidiary Spin Off

7.4

Further Assurances

7.5

Cooperation

7.6

Publicity

7.7

Additional Actions

7.8

Filings

7.9

Section 16 Matters

7.10

Shareholders Meetings

7.11

Preparation of the Proxy Statement/Prospectus and Registration Statement

7.12

Stock Exchange Listing

7.13

Affiliate Agreements

7.14

Tax Treatment

7.15

Expenses

ARTICLE VIII CONDITIONS TO CONSUMMATION OF THE MERGER

8.1

Conditions to the Obligation of Each Party

8.2

Conditions to the Obligations of Parent and Merger Sub

8.3

Conditions to the Obligations of Company

ARTICLE IX SURVIVAL

9.1

Survival of Representations and Warranties

9.2

Survival of Covenants and Agreements

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ARTICLE X TERMINATION, AMENDMENT AND WAIVER

10.1

Termination

10.2

Effect of Termination

10.3

Fees, Expenses and Other Payments

ARTICLE XI INDEMNIFICATION

11.1

Indemnification

11.2

Method of Asserting Claims, Etc

11.3

Satisfaction of Claims from Escrow Shares.

11.4

Instructions to Escrow Agent

11.5

No Waiver Relating to Claims for Fraud/Willful Misconduct

ARTICLE XII MISCELLANEOUS

12.1

Notices

12.2

Separability

12.3

Assignment

12.4

Interpretation

12.5

Counterparts

12.6

Entire Agreement

12.7

Governing Law

12.8

Attorneys Fees

12.9

No Third Party Beneficiaries

12.10

Amendments and Supplements

12.11

Extensions, Waivers, Etc

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AGREEMENT AND PLAN OF MERGER

This Agreement and Plan of Merger (this Agreement) dated as of September 20, 2006, by and among Gasco Energy, Inc. (Parent), a Nevada corporation, Gasco Acquisition, Inc. (Merger Sub), a Nevada corporation and a wholly-owned subsidiary of Parent and Brek Energy Corporation (Company), a Nevada corporation.

WHEREAS, the respective boards of directors of each of Parent, Merger Sub and Company deem it advisable and in the best interests of their respective shareholders that Parent acquire Company through the merger of Merger Sub with and into Company (the Merger) upon the terms and subject to the conditions set forth herein, and such boards of directors have approved the Merger; and

WHEREAS, concurrently with the execution and delivery of this Agreement, with the approval of Companys board of directors, Parent has entered into voting agreements with Richard N. Jeffs, Gregory Pek, Ian Robinson, Michael L. Nazmack, Eugene Sweeney and Shawne Malone (under which such party has among other things agreed to support the Merger upon the terms and conditions set forth therein (the Voting Agreement)); and

WHEREAS, for federal income tax purposes, the parties intend that the Merger will qualify as a reorganization under the provisions of Section 368(a) of the United States Internal Revenue Code of 1986, as amended (theCode);

NOW, THEREFORE, in consideration of the premises and the representations, warranties and agreements contained herein, the parties hereto agree as follows:

ARTICLE I

THE MERGER

1.1 The Merger

. Upon the terms and subject to the conditions hereof, at the Effective Time (as defined in Section 1.2) Merger Sub shall merge with and into the Company and the separate corporate existence of Merger Sub shall cease and Company shall be the surviving corporation in the Merger (sometimes referred to herein as the Surviving Corporation). The Merger shall have the effects set forth in Section 92A.250 of the Nevada Revised Statutes (the NRS), including the Surviving Corporations succession to and assumption of all rights and obligations of Merger Sub.

1.2 Effective Time of the Merger

. The Merger shall become effective (the Effective Time) upon the later of (i) the filing of the properly executed articles of merger relating to the Merger with the Secretary of State of Nevada in accordance with the NRS (the Articles of Merger), and the issuance by the Secretary of State of Nevada of a certificate of merger with respect thereto, and (ii) at such later time as the parties shall agree and set forth in such Articles of Merger. The filing of the Articles of Merger referred to above shall be made as soon as practicable after the satisfaction or waiver of the conditions set forth in Article VIII.

1.3 Tax Treatment

. It is intended that the Merger shall constitute a reorganization under Section 368(a) of the Code.

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ARTICLE II

THE SURVIVING CORPORATION

2.1 Articles of Incorporation

. At the Effective Time, the articles of incorporation of Company in effect immediately prior to the Effective Time shall be amended so that they are identical to the articles of incorporation of Merger Sub in effect immediately prior to the Effective Time until thereafter amended in accordance with the terms thereof and the NRS.

2.2 Bylaws

. The bylaws of Merger Sub as in effect immediately prior to the Effective Time shall be the bylaws of the Surviving Corporation at and after the Effective Time until thereafter amended in accordance with the terms thereof and as provided by the articles of incorporation of the Surviving Corporation and the NRS.

2.3 Directors and Officers

(a) The directors of Merger Sub immediately prior to the Effective Time shall be the directors of the Surviving Corporation, each to hold office in accordance with the articles of incorporation and bylaws of the Surviving Corporation until their respective successors are duly elected or appointed and qualified.

(b) The officers of Merger Sub immediately prior to the Effective Time shall be the officers of the Surviving Corporation, each to hold office in accordance with the articles of incorporation and bylaws of the Surviving Corporation until their respective successors are duly elected or appointed and qualified.

ARTICLE III

CONVERSION OF SHARES

3.1 Conversion of Capital Stock As of the Effective Time, by virtue of the Merger and without any action on the part of the holders of any capital stock described below:

(a) Treasury Stock. All shares of common stock of Company, par value $.001 per share (the Company Common Stock), that are held in Companys treasury shall be canceled and retired and no cash, capital stock or other consideration shall be delivered in exchange therefor.

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