JUNE 2009 WAIVER AND AMENDMENT AGREEMENT

THIS JUNE 2009 WAIVER AND AMENDMENT AGREEMENT (this “ Agreement ”) is made as of June 10, 2009, among South Texas Oil Company, a Nevada corporation (the “ Company ”), the Subsidiaries (as defined in the Purchase Agreements (as defined below)), and Longview Marquis Master Fund, L.P., a British Virgin Islands limited partnership (“ Marquis ”).

WHEREAS, the Company, Marquis and The Longview Fund, L.P., a California limited partnership (“ Longview ” and, together with Marquis, the “ April Buyers ”), entered into that certain Securities Purchase Agreement, dated as of April 1, 2008 (as amended by each of that certain June 2008 Amendment Agreement, dated as of June 18, 2008, among the Company and the April Buyers, that certain June 2008 Amendment to Senior Notes and Purchase Agreement, dated as of June 30, 2008 (the “ Second June 2008 Amendment Agreement ”), among the Company and the April Buyers, and that certain September 2008 Waiver and Amendment, dated as of September 19, 2008 (the “ September 2008 Waiver and Amendment ”), among the Company and the April Buyers, and as may otherwise be amended, supplemented, restated or modified and in effect from time to time, the “ April Purchase Agreement ”), pursuant to which (i) the Company issued to Longview senior secured notes in an aggregate original principal amount of $23,908,013.11, as of the date hereof, none of which remains outstanding as of the date hereof, (ii) the Company issued to Marquis senior secured notes in an aggregate original principal amount of $8,469,337.71 (such notes, together with any promissory notes or other securities issued in exchange or substitution therefor or replacement thereof, as amended by the Second June 2008 Amendment Agreement and as any of the same may otherwise be amended, supplemented, restated or otherwise modified and in effect from time to time, the “ Marquis April Notes ”), and (iii) the Warrants (as defined in the April Purchase Agreement) were amended and restated;

WHEREAS, the Company and Marquis entered into a Securities Purchase Agreement, dated as of September 18, 2008 (as amended, restated, supplemented or otherwise modified and in effect from time to time, the “ Bridge Purchase Agreement ” and, together with the April Purchase Agreement, the “ Purchase Agreements ”), pursuant to which the Company sold, and Marquis purchased, a senior secured note in the aggregate original principal amount of $7,000,000 (such note, together with any promissory notes or other securities issued in exchange or substitution therefor or replacement thereof, and as any of the same may be amended, supplemented, restated or otherwise modified and in effect from time to time, the “ Marquis Bridge Notes ”);

WHEREAS, pursuant to that certain Assignment and Assumption Agreement, dated as of May 29, 2009, Marquis transferred to Summerview Marquis Fund, L.P. (“ Summerview ” and together with Marquis, the “ Buyers ”), among other things, a portion of the Marquis April Notes in the principal amount of $2,252,994.73 (the “ Summerview Transferred April Notes ”), a portion of the Warrants representing the right to acquire 62,841 shares of common stock (“ Common Stock ”) of the Company (the “ Transferred Warrants ”), and a portion of the Marquis Bridge Notes in the principal amount of $1,759,556.47 (the “ Summerview

Transferred Bridge Notes ”), with the remainder of the Marquis April Notes in the principal amount of $6,710,038.53 (the “ Marquis Remaining April Notes ” and, together with the Summerview Transferred April Notes, the “ April Notes ”), the remainder of the Warrants representing the right to acquire 187,159 shares of Common Stock (the “ Remaining Warrants ” and, together with the Transferred Warrants, the “ April Warrants ”), and the remainder of the Marquis Bridge Notes in the principal amount of $5,240,433.53 (the “ Marquis Remaining Bridge Notes ” and, together with the Summerview Transferred Bridge Notes, the “ Bridge Notes ;” the Bridge Notes and the April Notes being collectively referred to as the “ Notes ”) continuing to be held by Marquis.

WHEREAS, the Company desires to enter into a Securities Purchase Agreement (such Securities Purchase Agreement, in the form attached hereto as Exhibit A , without amendment or other modification, the “ Subordinated Purchase Agreement ”), by and among the Company and the investors listed on the Schedule of Buyers thereto (the “ Subordinated Buyers ”), pursuant to which, subject to the terms and conditions set forth therein and in that certain Intercreditor Agreement, dated as of the date hereof (such Intercreditor Agreement, in the form attached hereto as Exhibit B , as may be amended, supplemented, restated or modified and in effect from time to time, the “ Intercreditor Agreement ”), by and among the Company, the Buyers and the Subordinated Buyers, the Company will sell, and the Subordinated Buyers will purchase, convertible notes in an aggregate original principal amount of up to $480,000 (such secured convertible notes, each in the form attached hereto as Exhibit C , without amendment or other modification, collectively, the “ Subordinated Notes ”) and warrants (such warrants, each in the form attached hereto as Exhibit D , without amendment or other modification, collectively, the “ Subordinated Warrants ” and, together with the Subordinated Notes, the “ Subordinated Securities ”) to purchase 480,000 shares of common stock of the Company (the “ Common Stock ”), subject to adjustment as set forth in the Subordinated Warrants; and

WHEREAS, the Company and the Buyers desire to amend the terms of each of the Notes and permit the issuance by the Company of the Subordinated Securities to the Subordinated Buyers, in the manner provided herein.

NOW, THEREFORE, in consideration of the agreements, provisions and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the undersigned agrees as follows:

1.            Amendment of the April Notes .

a.           The Company hereby agrees with each of the Buyers, severally and not jointly, that, as of the date first above written, the following definitions set forth in the Appendix to the April Notes shall be amended and restated to read in their entirety as follows:

“ Interest Payment Date ” means, for all periods prior to July 1, 2009, the first Business Day of each calendar quarter, beginning with the calendar quarter that commences on July 1, 2008, through and including the calendar quarter that commences on April 1, 2009, and for all periods on and after July 1, 2009, means the first Business Day of each calendar month, beginning with July 2009 through and including the last calendar month that commences prior to the Maturity Date.

“ Interest Rate ” means thirteen percent (13.00%) per annum.

“ Maturity Date ” means March 31, 2010.

b.           The Company hereby agrees with each of the Buyers, severally and not jointly, that, as of the date first above written, the second sentence of Section 2 of each of the April Notes is hereby amended and restated in its entirety to read as follows:

“Interest shall be paid quarterly in arrears on each Interest Payment Date prior to July 1, 2009, and on and after July 1, 2009, Interest shall be paid monthly in arrears on each Interest Payment Date and on the Maturity Date.”

c.           The Company hereby agrees with each of the Buyers, severally and not jointly, that, as of the date first above written, the definition of “ Event of Default ” set forth in Section 7(a) of each of the April Notes is hereby amended by adding new paragraph (xviii) immediately after paragraph (xvii) thereof, such paragraph to read in its entirety as follows:

“(xviii)  Any “ Event of Default ,” as defined in those certain convertible notes, dated June 10, 2009, issued by the Company pursuant to that certain Securities Purchase Agreement, dated as of June 10, 2009, among the Company and the investors listed on the Schedule of Buyers thereto.”

d.           As amended hereby, each of the April Notes shall remain in full force and effect.

2.            Amendment of the Bridge Notes .

a.           The Company hereby agrees with each of the Buyers, severally and not jointly, that, as of the date first above written, the following definitions set forth in the Appendix to the Bridge Notes shall be amended and restated to read in their entirety as follows:

“ Interest Payment Date ” means, for all periods prior to July 1, 2009, the first Business Day of each calendar quarter, beginning with the calendar quarter that commences on October 1, 2008, through and including the calendar quarter that commences on April 1, 2009, and for all periods on and after July 1, 2009, means the first Business Day of each calendar month, beginning with July 2009 through and including the last calendar month that commences prior to the Maturity Date.

“ Interest Rate ” means thirteen percent (13.00%) per annum.

“ Maturity Date ” means March 31, 2010.

b.           The Company hereby agrees with each of the Buyers, severally and not jointly, that, as of the date first above written, the second sentence of Section 2 of each of the Bridge Notes is hereby amended and restated in its entirety to read as follows:

“Interest shall be paid quarterly in arrears on each Interest Payment Date prior to July 1, 2009, and on and after July 1, 2009, Interest shall be paid monthly in arrears on each Interest Payment Date and on the Maturity Date.”

c.           The Company hereby agrees with each of the Buyers, severally and not jointly, that, as of the date first above written, the definition of “ Event of Default ” set forth in Section 10(a) of each of the Bridge Notes is hereby amended by adding new paragraph (xx) immediately after paragraph (xix) thereof, such paragraph to read in its entirety as follows:

“(xx)  Any “ Event of Default ,” as defined in those certain convertible notes, dated June 10, 2009, issued by the Company pursuant to that certain Securities Purchase Agreement, dated as of June 10, 2009, among the Company and the investors listed on the Schedule of Buyers thereto.”

d.           As amended hereby, each of the Bridge Notes shall remain in full force and effect.

3.            Limited Waiver .

a.           Subject to and effective upon the due execution and delivery by the Company and each of the Subordinated Buyers of the Intercreditor Agreement, and subject to the conditions set forth in Section 3(b) hereof, each of the Buyers, severally and not jointly, hereby waives any and all violations or breaches of the April Notes (as amended hereby) and the Bridge Notes (as amended hereby), respectively, and any of the other Transaction Documents (as defined in each of the Purchase Agreements, collectively, the “ Buyer Transaction Documents ”), as applicable, and any Event of Default (as defined in each of the Notes), solely to the extent that any such violation, breach or Event of Default is the direct result of the Company’s and the Subsidiaries’ issuance of the Subordinated Securities, and entering into, and carrying out their respective obligations under, the Subordinated Purchase Agreement, the Subordinated Securities, the Mortgages (as defined in the Subordinated Purchase Agreement) and the Subsidiary Guaranty (as defined in the Subordinated Purchase Agreement) (the Mortgages and the Subsidiary Guaranty, ea