Clearview Energy II, L.P. A Developmental Drilling Program

Clearview Energy II, L.P. A Developmental Drilling Program Managing Broker Dealer Alliance Affiliated Equities Corporation Member FINRA/SIPC/MSRB 1

Integrity. Experience. Transparency. King Consolidated, Inc. has offered over $150 million in institutional quality direct participation oil and gas investments to accredited and institutional investors through a network of FINRA broker-dealers. King prides itself on being an oil company first. King and its affiliates maintain an in house staff of geoscientists, petroleum engineers and landmen to continually evaluate oil and natural gas prospects. 2

Clearview II Drilling Program Opportunity Number of Wells: Up to 12 Issue Date: September 6, 2011 Offering Size: $60,000,000 Number of Units: 300 Unit Size: $200,000 Prospect Locations: Strawn Sand Formation Scurry County, Texas The Clearview Energy II, L.P. is a developmental drilling opportunity located solely in the prolific eastern shelf of the Permian Basin in West Texas. King Operating Corporation, a wholly owned affiliate, will not only be operating all program wells, it will also be participating financially alongside the program investors. Key Program Highlights Include: Opportunity to use new technology to enhance production and reserves in a proven and economically viable reservoir. Program Audit Industry priced AFE s Up to 85% first year tax deduction Persons Who Should Not Invest: Persons requiring immediate liquidity, guaranteed income, seeking a short-term investment, or who cannot afford to lose their principal. Sponsor Information: King Consolidated, Inc. North Dallas Energy Centre 6142 Campbell Road Dallas, Texas 75248 972-447-3535 office 972-447-3536 fax www.kingconsolidated.com This information is for the confidential use of prospective accredited investors. Any offer is solely by private placement memorandum in reliance on exemption from registration provided under section 4 (2) of the Securities Act of 1933 and Rule 506 of Regulation D there under. 1

Why Invest in Energy? World marketed energy consumption is projected to increase by 50 percent from 2005 to 2030. Source: Energy Information Administration, June 2008 2 Global energy demand is growing while global energy supplies may be near a peak. Direct investment in oil and natural gas may provide monthly cash flow, tax benefits and solid portfolio diversification. Increasing Global Demand Simply put, our modern world runs on oil and natural gas. Electrical power, transportation fuel, fertilizers, industrial materials and fabrics are all dependent on large scale and economical production of oil and gas. With a growing world population of seven billion people reaching for better living standards, everyone contributes to increasing industrial development, greater dependence on mechanized transportation and greater per capita energy use. The Dollar & Your Purchasing Power It is clear that global stock markets, debt markets, bank lending practices and government policies are changing with a frequency and scale that were unimaginable a few years ago. The US government has made financial

commitments to address the economic crisis that some experts estimate to be in excess of $12 trillion nearly the size of the US gross domestic product. If the US dollar declines how will you maintain your portfolio s purchasing power? Portfolio Diversification Direct energy investments allow investors to diversify their portfolio into assets with a traditionally low correlation to stock and bond market performance and a positive correlation with inflation. If you acquire a diversified portfolio of producing oil and gas properties, you may achieve monthly cash flow, and enhance your total portfolio returns. Tax Benefits/Long-term ROI Potential 1 For fifty years or more, Congress has provided tax incentives to stimulate domestic natural gas and oil exploration financed by private sources. While the primary reason to invest in oil and gas is a direct cash-on-cash return, available tax advantages may enhance the economics of direct oil and gas investment. Current tax law allows: Intangible Drilling Cost Deduction Intangible expenditures of drilling (labor, chemicals, mud, grease and others) typically 50% - 80% of well costs are 100% deductible during the first year. The Small Producers Exemption (Depletion Allowance) Fifteen percent of certain oil and gas production revenue may be received tax-free. 1 Prospective partners must consult their own professionals for tax information and advice. This information should in no way be construed or relied upon as tax advice. 3

Why King Consolidated? King Consolidated, Inc. is a privately held company based in Dallas, Texas that specializes in acquiring and operating oil and natural gas investments for the accredited and institutional investor. Uniquely structured to take advantage of market opportunities, King s institutional quality programs have raised the bar in the private oil and gas investment arena. Since 2006, King Consolidated and its affiliates have offered over $150 million in direct participation oil and gas investments through a network of FINRA broker-dealers. King Consolidated, Inc. and its affiliates leadership team led by founder and CEO James R. Jay Young has over a combined 100 years of oil and gas experience, and maintains an operating staff of industry specialists, including geoscientists, petroleum engineers, field operations managers, and landmen. These top professionals work together to evaluate, acquire and operate developmental oil and gas prospects located throughout the country. Over the past 14 years, King has participated in drilling wells that have created millions of barrels of proven domestic reserves. 4

Prior Activities Since 2006, King Consolidated, Inc. and its affiliates have acquired royalty interests on behalf of its investors that total over 1,100 wells and 186,000 acres throughout seven states including Louisiana, Mississippi, Alabama, Texas, Oklahoma, Kansas, and North Dakota. Well-diversified mineral rights, royalties, and overriding royalties, allow investors to enjoy monthly cash flows that can potentially last for generations. King also sponsors developmental drilling programs that are designed to exploit hydrocarbons from proven reserves as well as take advantage of the potential tax benefits currently available. Through three previous developmental drilling programs, King has drilled and/or participated in over 30 wells located on over 14,800 acres which boast diverse geologic formations. King acquires and develops properties using strategies that make the prospect attractive for acquisition. Geographic Focus King s operations are focused mainly in Texas and the South Central region of the United States, one of the most prolific oil producing areas in the world. In 2008, the U.S Energy Information Administration cited Texas as having the highest onshore proved oil reserves, and roughly two-thirds of the Nation s proved shale gas reserves. The EIA further predicts that approximately 44% of future onshore oil production will take place in this South Central region of the United States. 5

King Consolidated, Inc. Management Team The Management Team of King Consolidated, Inc. The King Consolidated, Inc. Management Team is comprised of experienced and tenured professionals from not only the oil and gas industry, but also from the financial planning and investment management industry. This diversity in management makeup allows for every aspect of business related functions to be addressed with the utmost professionalism and expertise needed to perform at the highest level for the King Investor. The Management Team of King Operating Corporation The King Operating Corporations Management Team is comprised of highly respected, experienced and seasoned veterans in the oil patch. Since inception, King Operating Corporation has followed the same goal: to continue its rapid growth by horizontally enhancing current projects, drilling and developing properties in a timely and cost efficient manner, and by investing in producing properties. James R. Young Chief Executive Officer, President and Sole Shareholder Mr. Young, relying on his family s fourth generation experience, has devoted his career to the oil and gas industry. After graduating from Angelo State University with a Bachelor of Business Administration degree in Marketing, Mr. Young selected the securities industry as his vocation and held Series 3, 7 and 63 licenses. In 1996, Mr. Young formed King Operating Corporation for petroleum exploration, development and production. Later, Mr. Young formed King Royalty Corporation and King Consolidated, Inc. to engage in the acquisition and sale of royalty and working interests. Mr. Young has negotiated lease and production acquisitions, led his technical team in developing many drilling and production programs, and has been the visionary in employing strategic planning and evaluation for the development of various oil and gas fields within Texas. Mr. Young is also President of Anderson-Drake, Inc. and Anderson-Drake Partners, Inc. 6 J. Robert Ransone Executive Vice President/Chief Operating Officer Mr. Ransone joined King Consolidated, Inc. in May 2010. Prior to joining King Mr. Ransone was President and Chief Operating Officer of Barnes Oil and Gas LLC, a Plano, Texas based private company with operations in the Barnett Shale. He has extensive management experience within the energy industry having served in various capacities including Manager of Acquisitions and Divestitures, CFO, COO, Partner, board member and also CEO of his own successful energy divestment advisory firm. Mr. Ransone has over 20 years experience in the specific area of energy asset acquisitions and divestments. He will oversee the day-today operations of the Partnership under the policy directives of the Chief Executive Officer. Mr. Ransone received has Bachelor of Arts degree in Economics from Stanford University and his Masters of Business Administration from the Wharton School of the University of Pennsylvania. He then served in the U.S. Army s Air Defense Artillery assigned to NORAD, receiving his honorable discharge as a Captain.

Rex E. Gifford Chief Financial Officer Mr. Gifford earned a Bachelor of Business Administration degree in Accounting from The University of Texas. He currently assists the Company and its affiliates, King Operating Corporation and King Royalty Corporation, in the formation, management and economic reporting functions for the properties sponsored by the Company. Prior to joining King Consolidated, Inc., Mr. Gifford functioned as the Chief Financial Officer of New Horizon Exploration, Inc. for twelve years. Before beginning his tenure with New Horizon, Mr. Gifford specialized in resolving complex accounting issues for individuals and companies. He also provided income tax services for both the private industry and local public accounting firms. Josh Fagan National Sales Director Mr. Fagan has been in the Securities industry for over 10 years and currently holds Series 7, 24, 63 and 65 securities licenses. Mr. Fagan is a principal of the Managing Broker-Dealer. Prior to joining King Consolidated, Inc., Mr. Fagan served as President and Chief Executive Officer of Fagan and Rawlings Capital Management where he oversaw the investment strategies for high net worth clients and institutions. Mr. Fagan is recognized in the broker-dealer community for his expertise in the 1031 exchange market. He is the founder of 1031Junction.com, an online 1031 exchange informational resource. Mr. Fagan serves as the liaison between King Consolidated, Inc. and the institutions throughout the United States. Jeff Katzman Vice President Sales - Western United States Prior to joining King Consolidated, Inc., Mr. Katzman marketed non-traded REIT offerings for Behringer Harvard and served as a Sales Director for Texas Energy Holdings in private placement oil and gas offerings. Before specializing in the alternative investment field, he was a financial advisor for Lincoln/Sagemark managing private wealth and estate planning. He has served as a public speaker for many events educating registered representatives, investors, and CPAs on the use of oil and gas as a tax efficient investing tool and for income potential. He earned a Bachelors of Science Degree from the University of Texas at Austin and currently holds the Series 7 and 66 licenses. Kyle Donnelly Executive Vice President - Broker Dealer/Investor Relations Mr. Donnelly is a graduate of Ohio State University where he earned his Bachelor of Science specializing in Financial Planning. Using his expertise in the securities industry, Mr. Donnelly serves as a liaison between the Company and broker dealer institutions throughout the United States. Additionally, he oversees all communication between the Company and its past, present, and future investors. Mr. Donnelly holds Series 7, 63, and 65 securities licenses and is a registered representative of the Managing Broker-Dealer. 7

King Operating Corporation Management Team Affiliated Consulting Company: King Operating Corporation is an affiliate of King Consolidated Partners, Inc. O. Dow Moore Director of Acquisitions Mr. Moore received his Bachelor of Science degree in Geology from Baylor University. Mr. Moore attributes much of his industry success to his experience as the head of his own independent oil and gas company and as a consultant for various operators in Dallas and Houston, Texas. He has been involved in all aspects of the oil and gas industry, including prospect generation, geological research, wellsite drilling supervision, sample analysis, and investor relations. Mr. Moore is on the Board of Directors of the Texas Alliance of Energy Producers. Cruz Abila Chief Production Engineer Mr. Abila graduated from Texas A&M University with a Bachelor of Science Degree in Petroleum Engineering. Upon graduation, he was employed by Texaco Exploration & Production, Inc. in Midland, Texas where he spent five years as a drilling, production and completion engineer in various gas fields, waterfloods and CO2 floods in the Permian Basin. Mr. Abila spent the last ten years in various positions of increasing responsibility at Merit Energy Company based out of Dallas, Texas. He spent time as an engineer responsible for assets in Texas, Louisiana (onshore/offshore), Wyoming and North Dakota; spent time as a Marketing Manager of approximately 50,000 gross BOEPD in Wyoming, Utah, Colorado and Michigan; and spent time as Region Manager of assets in the Gulf of Mexico (Texas-Shelf), in Arkansas primary gas and Barnett Shale resource play development. Most recently, Mr. Abila managed assets in the Permian Basin which included waterfloods and Wolfberry resource play development of approximately 12,000 BOEPD, $4.0 million per month lease and expense workover budgets and a $30 million per year capital program. 8

Drilling rig using the latest in directional drilling technologies to complete the #34-1H in Scurry County, TX As of August 31, 2011, the #34-1H has produced 48,193 BO and 98,530 MCF in just over 8 months. This Long Single Lateral was completed using a 7 stage, plug-&perf frac 9

Strawn Sand Formation Geological Summary Scurry Figure 1 Location Map The Ernest Strawn Sand Oil Field is located eight miles southeast of Snyder, in Scurry County, Texas (See Figure 1). The reservoir consists of thick oil-saturated river channel sand deposits. Discovered in 1956, the seventeen vertical wells drilled in the field collectively produced approximately 315,000 BO ( barrels of oil ) and 252,000 MCF ( thousand cubic feet ) before abandonment in 1991. Oil columns ranged in thickness from 10 to nearly 100, yet the wells averaged less than 20,000 BO on 160 acre units. Standard volumetric calculations indicate that a 160 acre unit with a 50 oil column and 12% porosity holds approximately 4,000,000 barrels of oil in place. The vast majority of the oil remains in place. 12 King Operating Corporation ( King ) recognized this field presented the perfect opportunity to exploit a low porosity, low permeability reservoir using modern drilling and completion techniques. Specifically, horizontal drilling to expose more reservoir to the wellbore and current completion practices which utilize multi-stage focused fracs (See Figure 2 on page 13 and Schematic Diagram on pages 10 & 11). Beginning in 2001, King began drilling operations in the Strawn Sand Oil Field. Encouraged by increased production, operations have continued on a nearly continuous basis. One of the first wells in the field to use the latest technologies was the King-Ernest #19-H and more recently, the King-Ernest #34-1H, both Long Single Laterals. The King-Ernest #19H extended out laterally to a distance of 3,499 in a westerly direction exposing approximately 5,722 sqft of reservoir to the wellbore. Comparing this to an average well drilled in the 1950 s, this is approximately a 40 fold increase in reservoir exposure to the wellbore (See Figure 3 on page 17 and Schematic Diagram on pages 10 & 11). The long single lateral was completed on March 19th and 20th in 2010 and utilized a plug and perf technique with a six stage frac. Initial gauged production rates approached a peak rate of approximately 395 BOPD ( barrels of oil per day ) plus up to 245 MCFPD ( thousand cubic feet per day ). Daily gauge reports indicate that during the first thirty-five days the #19-H produced an average of approximately 218 BOPD plus 201 MCFPD. The King-Ernest #34-1H was drilled with the assistance of an industry-leading independent engineering firm that specializes at optimizing reservoir responses and emphasizes appropriate field implementation. Their expertise recommended changing the drilling orientation for this well compared to previous wells and utilizing the latest in fracking technology. It was drilled laterally to a distance of 2,300 and in a northern orientation to expose approximately 3,760 sq ft of the reservoir to the

wellbore. Initial gauged production rates approached an impressive peak rate of approximately 824 BOPD plus up to 919 MCFPD. During the first thirty days of full production, the #34-1H averaged 451 BOPD and 565 MCFD. Over a span of just over eight months, this well has produced 48,193 BO and 98,530 MCF. Thus far, the #34-1H has produced approximately twice as much oil as the King-Ernest #19-H and has done it in half the production time. King believes this well is a good barometer for future developments. The revitalization of the abandoned Ernest Straw Sand Field began in 2001 when King re-commenced drilling operations in the area. Horizontal drilling programs were employed by King and each new horizontal well provided valuable information to help improve drilling and completion techniques. At this point in the field s development, the operator uses Long Single Laterals and plug and perf completion practices. These completions utilize multi-stage fracs to extract maximum amount of hydrocarbons from the Strawn Sand (See Figure 2 below). All future horizontal wells have the potential to expose 7,000 to 7,400 sqft of oil saturated Strawn Sand to the wellbore. This equates to approximately 5,000% more pay zone exposure than in an average vertical well in the field. Estimated initial production from these wells has surpassed the initial estimates of 400 BOPD and up to 400 MCFD with the completion and production of the #34-1H. Figure 2 13

King Technology 14 By philosophy and in practice, King is committed to state-of-the-art methods to maximize the production potential of its areas of operation. Some of the technologies currently employed by King include: Hydraulic Fracturing Hydraulic Fracturing describes the technique of pumping large amounts of sand and fluid down the wellbore at very high rates and pressures. This combination breaks the rock, which increases inflow of oil and gas into the wellbore, thus potentially enhancing ultimate recoveries. Early wells utilized white Brady or Ottawa sand exclusively, resulting in several instances of excessive sand flow-back problems. In early 2009, King Operating Corporation ( KOC ) addressed this issue by using resin coated sand in the final 15% to 30% of the hydraulic fractures. Resin coated sand has a thin coating of resin on the sand granules which adhere to each other creating a boundary which eliminates or greatly reduces the ability for reservoir sand and/or white frac sand to flow back into the wellbore. Maintaining the frac sand in place maximizes the conductivity of the fracture system, which could potentially increase rate and recovery from the well while minimizing expenses to maintain lift equipment adversely affected by sand production. Drilling Advances This drilling program will employ a small lower cost drilling rig to drill the initial +/- 3000 of the well and set and cement casing at this depth. Afterward a fit-for-purpose rack and pinion drilling rig will be utilized which incorporates the advantages of a top-drive, 1000 HP, and additional features, allowing for faster and more efficient drilling of long laterals nearly 1 mile in length.

King Technology (cont.) Completion Completion methods planned for the drilling program include cementing a 4-1/2 liner in the horizontal section of the well and performing multi-stage fracturing along the horizontal with a plug, perf and fracture technique. KOC has previously employed sophisticated systems with open hole rock packers and fracture ports; however, results from recently completed wells indicate better flexibility, simplicity, and lower costs employing a plug, perf and fracture method. Technology is also applied to the producing method in the Ernest Field by teaming with a gas gathering company in 2009 to install a refrigeration plant to cool the gas and extract natural gas liquids ( NGL s ). KOC has a profit sharing contract with the gathering company, proceeds of which are passed through to the L.P., and could result in an increase in revenue from gas production as compared to selling gas simply on a volume basis. 15

Proof of Concept As with any unconventional oil field, proof of concept is paramount in creating significant value. King Operating, Inc. has spent 10 years and an excess of $70 Million to do just that. With recent successes seen in the field, King is confident that the most effective combination of both drilling and completion technologies have been discovered. The chart below highlights the dramatic increase in production using the latest technologies. The #34-1H, which was completed in late December, 2010 has to date produced more oil than all but one well in the field since inception. In fact, in just 6 months the well has out produced the field s average per well cumulative production. Higher initial production rates create higher reserves thus creating a higher value for the field. The Clearview Energy II, LP is designed to potentially create significant value through proving reserves for its investors. In today s economic climate, publically traded oil companies are seeking to add proved reserves to their balance sheets. King Operating, Inc. believes that there is potentially 50 Million barrels of oil in the field that could be proved after all phases of planned drilling are complete. 16

Figure 3 17

Exit Strategy 18 King recognizes the time value of money and is committed to accelerating potential future returns through enhancement of producing assets and divestiture of proven reserves. The company s primary strategy is to identify and acquire assets in areas with current production and exploit these proven reservoirs, rather than explore for new ones. With this focus, King attempts to add value to these assets through drilling wells and developing projects to such a level that is attractive for acquisition. In order to accomplish this, King Operating Corporation, an affiliate of the Sponsor and Managing Partner, outlines the complete plan of development for the entire prospect prior to initial drilling operations. This process includes choosing the optimal number of wells, identifying the best locations, as well as designing the drilling and completion techniques. Deciding on the right balance of producing wells to offset locations, called Proved Undeveloped Locations (PUDS), is a crucial part of preparing a project for sale. Many exploration and production companies prefer to purchase properties that have significant development and current cash flows; however, these projects must have sufficient additional drill sites to be attractive. There must be adequate undeveloped acreage for the purchaser to repeat the drilling program established by the seller. Exploiting these PUD reserves allows the purchaser to capture the upside portion of the acquisition. As previously stated, it is the goal of the Sponsor to acquire and develop assets that fit the criteria these larger companies are looking for. By focusing its strategies, King believes it can bring these projects full cycle and add value to the Partnership through the divestment of optimally developed assets.

What are oil reserves? Reserves are those quantities of petroleum claimed to be commercially recoverable by application of development projects to known accumulations under defined conditions. Reserves must satisfy four criteria: 1. Discovered through one or more exploratory wells 2. Recoverable through existing technology 3. Commercially viable 4. Remaining in the ground The three p s Proved - Reserves claimed to have a reasonable certainty (normally at least 90% confidence) of being recoverable under existing economic and political conditions, with existing technology. Probable - Probable reserves are attributed to know accumulations and claim a 50% confidence level of recovery. Industry specialists refer to them as P50 (i.e. having a 50% certainty of being produced). Possible Possible reserves are attributed to known accumulation that have a less likely chance of being recovered than probable reserves. This term is often used for reserves which are claimed to have at least a 10% certainty of being produced (i.e. P10) Proved Undeveloped Proved Undeveloped Reserves Reserves Each square = 160 acre spacing PROBABLE PROVED PROBABLE POSSIBLE Each Commercially square = 160 acre viable spacing well in green PROVED PROVED POSSIBLE Commercially Adjacent viable blue squares well in green become proved reserves Adjacent blue squares become proved reserves PROBABLE PROVED PROBABLE POSSIBLE POSSIBLE POSSIBLE POSSIBLE POSSIBLE 19

Program Economics Clearview Energy II, LP Investment (Unit) $200,000 Intangible Cost (Estimate) 80% Tangible Cost (Estimate) 7% Syndication Costs (Estimate) 13% Year 1 Estimated Intangible Drilling Cost Deduction $160,000 Year 1 Estimated IDC Tax Deduction $160,000 Year 1 2011 Eligible Tangible Drilling Cost Deduction (MACRS 7-Year Property, IRC 168 k(5), 100%) $14,000 Total Estimated Deductions $174,000 Total Estimated Reduction of Tax Liability $60,900 Maximum Income Tax Bracket (Excluding Possible state income tax) 35% Net Cash Outlay (Estimated) $139,100 20 The depletion allowance tax benefit is most likely 15% of gross income; therefore, only 85% of production income may be taxable. The preceding projection was prepared using information deemed to be reliable as of the issue date is intended only as an approximation of what tax savings may be expected from the partnership under certain assumed favorable conditions. The information set forth above should not be relied upon for any purpose other than as an illustration of the tax benefits that can be realized under certain assumed conditions. Prospective partners must consult their own professionals for tax information and advice. This information would in no way be construed or relied upon as tax advice.

Program Economics Based on 1 Unit Investment ($200,000) The following economic model is for illustration purposes only. As with any oil and gas program, significant risk exists that the wells in the Clearview II Program could be unproductive and an investor s entire principal could be lost. Furthermore, even if production is obtained in commercial quantities, there can be no assurance that it will be in such quantities as to meet these estimates. Accordingly, the actual results for the Clearview II Program may be significantly different than anticipated and may result in investors losing part if not all of their investment in the Clearview II Program. Clearview Energy II, L.P. Program Economics Year Oil Gross Gas Gross NGL Gross (Barrels) Oil Price ($/bbl) Gas Price ($/Mcf) NGL Price ($/bbl) Potential Yearly Revenue 1 537,944 968,299 136,530 83.29 3.90 29.63 104,738 2 304,495 548,091 77,281 85.31 4.29 31.65 59,530 3 186,764 336,176 47,401 86.75 4.68 33.09 36,330 4 138,242 248,835 35,086 87.38 4.97 33.72 26,496 5 111,002 199,804 28,172 87.93 5.40 34.27 21,024 This economic model is intended to show the potential cash flows, if any, that could be achieved by the Clearview II Energy, L.P. The distributions projected in the model are net of both severance taxes and operating expenses. Certain specific assumptions about the price of commodities, recoverable reserves, transportation contracts, and other factors were made in this forecast. As such, the results and potential returns speculated by the economic model are necessarily hypothetical. This model in no way is a guarantee of performance or future results. 21

KING CONSOLIDATED, INC. North Dallas Energy Centre 6142 Campbell Road Dallas, Texas 75248 (972) 447-3535 office (972) 447-3536 fax www.kingconsolidated.com