<HTML>
<HEAD>
<TITLE>sv8</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 12pt">As
filed with the Securities and Exchange Commission on June&nbsp;16,
2006
</DIV>
<DIV align="right" style="font-size: 10pt; margin-top: 6pt">Registration No.&nbsp;333-<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>
</DIV>




<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>




<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>Washington, D.C. 20549</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

</DIV>
<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>FORM S-8</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>REGISTRATION STATEMENT<BR>
UNDER<BR>
THE SECURITIES ACT OF 1933</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

</DIV>
<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>BRIGHAM EXPLORATION COMPANY</B>
</DIV>

<DIV align="center" style="font-size: 10pt">(Exact name of registrant as specified in its charter)</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>Delaware</B><BR>
(State or other jurisdiction<BR>
of incorporation or organization)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>75-2692967</B><BR>
(I.R.S. Employer Identification No.)</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><B>6300 Bridge Point Parkway, Building 2, Suite&nbsp;500<BR>
Austin, Texas</B><BR>
(Address of Principal Executive Offices)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>78730</B><BR>
(Zip Code)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV></DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Brigham Exploration Company 1997 Director Stock Option Plan</B><BR>
(Full title of the plan)
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>Ben M. Brigham</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><I>Copy to:</I></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><B>President, Chief Executive Officer<BR>
and Chairman of the Board<BR>
Brigham Exploration Company<BR>
6300 Bridge Point Parkway, Building 2, Suite&nbsp;500<BR>
Austin, Texas 78730</B><BR>
(Name and address of agent for service)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><BR><B>Joe Dannenmaier<BR>
Thompson &#038; Knight L.L.P.<BR>
1700 Pacific Avenue, Suite&nbsp;3300<BR>
Dallas, Texas 75201<BR>
(214)&nbsp;969-1700</B></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><B>(512)&nbsp;427-3300</B><BR>
(Telephone number, including<BR>
area code, of agent for service)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CALCULATION OF REGISTRATION FEE</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="36%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="19%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR>

<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-bottom: 2px double #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Proposed</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD nowrap align="center"><B>Title of</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Amount</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Proposed</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>maximum</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD nowrap align="center"><B>securities to</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>to be</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>maximum offering</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>aggregate</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Amount of</B></TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD nowrap align="center"><B>be registered</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>registered</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>price per share (1)</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>offering price (1)</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>registration fee</B></TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD width="1%" style="border-top: 1px solid #000000">&nbsp;</TD>
                    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:15px; text-indent:-15px">Common Stock, par
value $.01 per share</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>

<TD colspan="3" align="center" style="border-top: 1px solid #000000">429,800 shares (2)</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">7.00</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">3,008,600</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">321.92</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-top: 3px double #000000">&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(h)
under the Securities Act of 1933 (the &#147;Securities Act&#148;) and based on the average of the high and
low prices of the common stock reported on the Nasdaq National Stock Market on June&nbsp;13, 2006.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Pursuant to Rule&nbsp;416, shares issuable upon any stock split, stock dividend or similar
transaction with respect to these shares are also being registered hereunder.</TD>
</TR>

</TABLE>
</DIV>

<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>





<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">








<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>EXPLANATORY NOTE</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We prepared this Registration Statement in accordance with the requirements of Form S-8 under
the Securities Act to register an aggregate of
422,800&nbsp;shares of our common stock which may be issued
pursuant to our 1997 Director Stock Option Plan, or the Plan.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Registration Statement also constitutes a &#147;reoffer&#148; prospectus prepared in accordance
with Instruction C of the General Instructions to Form S-8 and Part&nbsp;I to Form S-3. This prospectus
may be utilized by certain participants under the Plan to cover
reoffers and resales of the 7,000&nbsp;shares
of common stock received as a result of the exercise of stock options granted under, the Plan. This
Registration Statement also contains the information required pursuant to Part&nbsp;II of Form S-8.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The document(s) containing the information specified in Part&nbsp;I of Form S-8 (plan information
and registrant information) will be sent or given to plan participants as specified by Rule
428(b)(1) under the Securities Act. In accordance with Rule&nbsp;428 under the Securities Act and the
&#147;Note&#148; to Part&nbsp;I of Form S-8, these documents are not being filed with the SEC either as part of
this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule&nbsp;424 under
the Securities Act. These documents and the documents incorporated by reference in this
Registration Statement pursuant to Item&nbsp;3 of Part&nbsp;II of this Form S-8, taken together, constitute a
prospectus that meets the requirements of Section 10(a) of the Securities Act.
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>PART I</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 1. PLAN INFORMATION.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The document(s) containing the information specified in Part&nbsp;I of this Form S-8 will be sent
or given to Plan participants as specified by Rule&nbsp;428(b)(1) under the Securities Act. Such
documents are not being filed with the Securities and Exchange Commission, but constitute, along
with the documents incorporated by reference into this Registration Statement, a prospectus that
meets the requirements of Section 10(a) of the Securities Act.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company will furnish without charge to each person to whom the prospectus is delivered,
upon the written or oral request of such person, a copy of any and all of the documents
incorporated by reference in Item&nbsp;3 of Part&nbsp;II of this Form S-8, other than exhibits to such
documents (unless such exhibits are specifically incorporated by reference to the information that
is incorporated). Those documents are incorporated by reference in the Section 10(a) prospectus.
Requests must be made to Brigham Exploration Company, General Counsel, 6300 Bridge Point Parkway,
Building Two, Suite&nbsp;500, Austin, Texas 78730, (512)&nbsp;427-3300.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Note</B>: The re-offer prospectus referred to in the Explanatory Note follows this page.
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>BRIGHAM EXPLORATION COMPANY</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>PROSPECTUS</B>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This prospectus relates to the reoffer and resale from time to time by certain of our
stockholders identified herein under the heading &#147;Selling
Stockholders&#148; of up to 7,000&nbsp;shares of
our common stock issued upon the exercise of outstanding options granted to such selling
stockholders pursuant to Plan. See &#147;Selling Stockholders.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The selling stockholders identified in this prospectus may offer the shares from time to time
through public or private transactions at prevailing market prices, at prices related to prevailing
market prices or at privately negotiated prices. We will not receive any proceeds from the sale of
the shares covered by this prospectus.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our common stock is quoted on the Nasdaq National Market under the trading symbol &#147;BEXP.&#148; On
June&nbsp;14, 2006, the last reported closing price of our common
stock was $6.98 per share on the
Nasdaq National Market.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>The common stock offered pursuant to this prospectus involves a high degree of risk. For more
information, please see the section of this prospectus titled &#147;Risk Factors,&#148; beginning on page 2.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal offense.</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt">The
date of this prospectus is June&nbsp;16, 2006
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<!-- TOC -->
</DIV>
<DIV align="left">
<A name="tocpage"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>TABLE OF CONTENTS</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="96%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="0%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#101">About Us
</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">1</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#102">Risk Factors
</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#103">Selling Stockholders
</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">15</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#104">Use of Proceeds
</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">16</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#105">Plan of Distribution
</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">17</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>


<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#110">Forward
Looking Statements</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">18</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#106">Where You Can Find More Information</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">18</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#109">Incorporation of Documents by Reference</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">18</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#107">Experts
</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">18</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><A href="#108">Legal Matters
</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">19</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h37069exv5w1.htm">Opinion of Thompson & Knight LLP</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h37069exv23w1.htm">Consent of PricewaterhouseCoopers LLP</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="h37069exv23w2.htm">Consent of Cawley Gillespie & Associates, Inc.</A></FONT></TD></TR>
</TABLE>
</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless the context otherwise requires or otherwise specifies, references in this prospectus to
&#147;Brigham,&#148; &#147;we,&#148; &#147;our,&#148; and &#147;us&#148; refer to Brigham Exploration Company, unless otherwise indicated.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have not authorized anyone to provide you with information different from that contained or
incorporated by reference in this prospectus. The selling stockholders are offering to sell, and
seeking offers to buy, shares of our common stock only in jurisdictions where offers and sales are
permitted. The information contained in, or incorporated by reference in, this prospectus is
accurate only as of the date of this prospectus, or the date of the document in which it appears,
regardless of the time of delivery of this prospectus or of any sale of common stock.
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<A name="101"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>ABOUT US</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are an independent exploration, development and production company that utilizes 3-D
seismic imaging and other advanced technologies to systematically explore for, develop and produce
domestic onshore oil and natural gas reserves. We focus our activities in provinces where we
believe 3-D seismic technology can be used effectively to maximize our return on invested capital
by reducing drilling risk. Our exploration and development activities are concentrated in three
provinces: the onshore Texas Gulf Coast, the Anadarko Basin and West Texas.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are incorporated in the state of Delaware. Our executive offices are located at 6300
Bridge Point Parkway, Building Two, Suite&nbsp;500, Austin, Texas 78730 and our telephone number is
(512)&nbsp;427-3300. Information contained on our website, www.bexp3d.com, is not part of this
prospectus.
</DIV>

<P align="center" style="font-size: 10pt">1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left">
<A name="102"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>RISK FACTORS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You should carefully consider the following risk factors, in addition to the other information
set forth in this prospectus. Each of these risk factors could adversely affect our business,
operating results and financial condition.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Risks Relating to the Exchange Notes</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Holders of outstanding notes who fail to properly tender them may be unable to resell them.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you do not tender your outstanding notes or if we do not accept your outstanding notes
because you did not tender your outstanding notes properly, then, after we consummate the exchange
offer, you may continue to hold outstanding notes that are subject to the existing transfer
restrictions. We will only issue exchange notes in exchange for outstanding notes that are timely
received by the exchange agent, together with all required documents, including a properly
completed and signed letter of transmittal. Therefore, you should allow sufficient time to ensure
timely delivery of the outstanding notes and you should carefully follow the instructions on how to
tender your outstanding notes. Neither we nor the exchange agent are required to tell you of any
defects or irregularities with respect to your tender of the outstanding notes. In addition, if you
tender your outstanding notes for the purpose of participation in a distribution of the exchange
notes, you will be required to comply with the registration and prospectus delivery requirements of
the Securities Act in connection with any resale of the exchange notes. If you are a broker-dealer
that receives exchange notes for your own account in exchange for outstanding notes that you
acquired as a result of market-making activities or any other trading activities, you will be
required to acknowledge that you will deliver a prospectus in connection with any resale of such
exchange notes. After the exchange offer is consummated, if you continue to hold any outstanding
notes, you may have difficulty selling them because there will be less outstanding notes
outstanding. In addition, if a large amount of outstanding notes are not tendered or are tendered
improperly, the limited amount of exchange notes that would be issued and outstanding after we
consummate the exchange offer could lower the market price of such exchange notes.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our level of indebtedness may adversely affect our cash available for operations, which would limit
our growth, our ability to make interest and principal payments on our indebtedness as they become
due and our flexibility to respond to market changes.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At March&nbsp;31, 2006, we had indebtedness of $44.3&nbsp;million outstanding under our senior credit
agreement and $30&nbsp;million outstanding under our subordinated credit agreement. After we used the
net proceeds from the Notes offering to repay the amounts outstanding under our senior and
subordinated credit agreements, we had $125&nbsp;million in outstanding indebtedness, as well as $50
million of borrowing capacity available to us for borrowing under our $200&nbsp;million senior credit
agreement. Our level of indebtedness has several important effects on our operations, including
those listed below.
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>It may make it more difficult for us to satisfy our obligations with respect to the
exchange notes.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We will dedicate a portion of our cash flow from operations to the payment of interest
on our indebtedness and to the payment of our other current obligations and will not have
these cash flows available for other purposes.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our senior credit agreement and the indenture governing the exchange notes will limit
our ability to borrow additional funds or dispose of assets and may affect our flexibility
in planning for, and reacting to, changes in business conditions.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our ability to obtain additional financing in the future for working capital, capital
expenditures, acquisitions, general corporate purposes or other purposes may be impaired.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We may be more vulnerable to economic downturns and our ability to withstand sustained
declines in oil and natural gas prices may be impaired.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our flexibility in planning for or reacting to changes in market conditions may be limited.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>It may place us at a competitive disadvantage compared to our competitors that have less debt.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We may incur additional debt in order to fund our exploration and development activities. A
higher level of indebtedness increases the risk that we may default on our debt obligations. Our
ability to meet our debt obligations and reduce our level of indebtedness depends on future
performance. General economic conditions, oil and natural gas prices and financial, business and
other factors will affect our operations and our future performance. Many of these factors are
beyond our control and we may not be able to generate sufficient cash flow to pay the interest on
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">our debt, and future working capital, borrowings and equity financing may not be available to
pay or refinance such debt.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, under the terms of our senior credit agreement, the borrowing base is subject to
at least semi-annual redeterminations based in part on prevailing oil and natural gas prices. In
the event the amount that we have borrowed under our senior credit agreement exceeds the
redetermined borrowing base, we could be forced to repay a portion of our borrowings. We may not
have sufficient funds to make such payments. If we do not have sufficient funds and are otherwise
unable to negotiate renewals of our borrowings or arrange new financing, we may have to sell assets
at unfavorable prices.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Despite current indebtedness levels, we and our subsidiaries may still be able to incur
substantially more debt, including secured debt. This could further exacerbate the risks associated
with our substantial leverage.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We and our subsidiaries may be able to incur substantial additional indebtedness in the
future. The terms of the indenture governing the exchange notes will not, and our senior credit
agreement does not, prohibit us or our subsidiaries from doing so. In addition to the liens granted
under our senior credit agreement, the indenture governing the exchange notes will allow us to
grant liens on all of our other assets to secure indebtedness outstanding under the senior secured
credit agreement and certain additional other debt without ratably securing the exchange notes. Our
senior credit agreement provides for total revolving credit borrowings up to $200&nbsp;million (which
borrowings are limited by a borrowing base that is subject to re-determination at least
semi-annually and is currently set at $50&nbsp;million) and all of those borrowings would be effectively
senior to the exchange notes and to the subsidiary guarantees thereof to the extent of the value of
the assets securing such indebtedness. If new indebtedness is added to our and our subsidiaries&#146;
current debt levels, the related risks that we and they now face could intensify and we may not be
able to meet all our debt obligations, including the repayment of the exchange notes, in whole or
in part.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>To service our indebtedness, we will require a significant amount of cash. Our ability to generate
cash depends on many factors beyond our control.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our ability to make payments on and to refinance our indebtedness, including the exchange
notes, and to fund planned capital expenditures and development efforts will depend on our ability
to generate cash in the future. This, to a certain extent, is subject to general economic,
financial, competitive, legislative, regulatory and other factors that are beyond our control.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We cannot assure you that our business will generate sufficient cash flow from operations or
that future borrowings will be available to us under our senior credit agreement or otherwise in an
amount sufficient to enable us to pay our indebtedness, including the exchange notes, or to fund
our other liquidity needs. We may need to refinance all or a portion of our indebtedness, including
the exchange notes, on or before the maturity thereof. Any future borrowings under our senior
credit agreement will mature in June&nbsp;2010. As a result, we may be required to refinance any
indebtedness then outstanding under our senior credit agreement prior to the maturity of the
exchange notes. We may not be able to obtain such financing on commercially reasonable terms or at
all. If we are unable to generate sufficiently material cash flow to refinance our debt
obligations, including the exchange notes, on favorable terms, it could have a significant adverse
effect on our financial condition and on our ability to pay principal and interest on the exchange
notes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, if for any reason we are unable to meet our debt service obligations, we would be
in default under the terms of our agreements governing our outstanding debt. If such a default were
to occur, the lenders under our senior credit agreement could elect to declare all amounts then
outstanding under the senior credit agreement immediately due and payable, and the lenders would
not be obligated to continue to advance funds under our senior credit agreement. In addition, if
such a default were to occur, the exchange notes would become immediately due and payable. If the
amounts outstanding under these debt agreements are accelerated, we cannot assure you that our
assets will be sufficient to repay in full the money owed to the banks or to our debt holders,
including holders of exchange notes.
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;3
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Your right to receive payments on the exchange notes is effectively subordinated to the rights
of our and the guarantors&#146; existing and future secured creditors.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Holders of our secured indebtedness and the secured indebtedness of the guarantors will have
claims that are prior to your claims as holders of the exchange notes to the extent of the value of
the assets securing that other indebtedness. Notably, we and the guarantors are parties to our
senior credit agreement, which is secured by liens on substantially all of our assets and the
assets of the guarantors. The exchange notes will be effectively subordinated to any secured
indebtedness incurred under the senior credit agreement. In the event of any distribution or
payment of our or any guarantor&#146;s assets in any foreclosure, dissolution, winding-up, liquidation,
reorganization or other bankruptcy proceeding, holders of secured indebtedness will have prior
claim to those of our or the guarantor&#146;s assets that constitute their collateral. Holders of
exchange notes will participate ratably with all holders of our unsecured indebtedness that is
deemed to be of the same class as such exchange notes, and potentially with all of our or any
guarantor&#146;s other general creditors, based upon the respective amounts owed to each holder or
creditor, in our remaining assets. In any of the foregoing events, we cannot assure you that there
will be sufficient assets to pay amounts due on the exchange notes. As a result, holders of
exchange notes may receive less, ratably, than holders of secured indebtedness.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Up to $50&nbsp;million of secured indebtedness will be available to be borrowed under the borrowing
base under our senior credit agreement. In addition, we will be permitted to borrow secured
indebtedness in the future under the terms of the indenture. See &#147;Description of Exchange Notes &#151;
Certain Covenants &#151; Incurrence of Indebtedness and Issuance of Disqualified Stock&#148; and &#151; &#147;Liens.&#148;
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The exchange notes will be effectively subordinated to the debt of our non-guarantor subsidiaries,
if any.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The exchange notes will be fully and unconditionally guaranteed on a senior unsecured basis by
our existing operating subsidiaries, as well as all of our future domestic subsidiaries. However,
they will not be guaranteed by any of our future subsidiaries outside the United States unless,
subject to certain limited exceptions, these subsidiaries guarantee our other domestic
indebtedness. In addition, on the issue date of the exchange notes, two of our wholly owned
subsidiaries (referred to herein as the &#147;limited partners&#148;), which together own approximately 99%
limited partnership interests in Brigham Oil &#038; Gas, L.P., our primary operating subsidiary, will
not be guarantors of the exchange notes. As of the date of this prospectus, the limited partners do
not conduct any business or operations and hold no properties other than the limited partnership
interests in Brigham Oil &#038; Gas, L.P. and other minor miscellaneous assets. Under the indenture
governing the exchange notes, the limited partners will be required to guarantee the exchange notes
after the issue date if they ever (i)&nbsp;hold properties in excess of $1&nbsp;million, (ii)&nbsp;incur debt in
excess of $1&nbsp;million, or (iii)&nbsp;guarantee any of our or our subsidiaries&#146; indebtedness. See
&#147;Description of Exchange notes &#151; Certain Covenants &#151; Restrictions on Limited Partners.&#148; The
indenture also provides that the exchange notes may not be guaranteed by certain subsidiaries with
minimal net worth. The exchange notes will be effectively subordinated to all debt and other
liabilities, including trade payables of any subsidiaries that do not guarantee the exchange notes.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>If we default on our obligations to pay our other indebtedness, we may not be able to make payments
on the exchange notes.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any default under the agreements governing our indebtedness, including a default under our
senior credit agreement that is not waived by the required lenders, and the remedies sought by the
holders of any such indebtedness, could make us unable to pay principal, premium, if any, and
interest on the exchange notes and substantially decrease the market value of the exchange notes.
If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds
necessary to meet required payments of principal, premium, if any, and interest on our
indebtedness, or if we otherwise fail to comply with the various covenants, including financial and
operating covenants, in the instruments governing our indebtedness (including our senior credit
agreement), we could be in default under the terms of the agreements governing such indebtedness.
In the event of such default, the holders of such indebtedness could elect to declare all the funds
borrowed thereunder to be due and payable, together with accrued and unpaid interest, the lenders
under our senior credit agreement could elect to terminate their commitments, cease making further
loans and institute foreclosure proceedings against our assets, and we could be forced into
bankruptcy or liquidation. If our operating performance declines, we may in the future need to seek
to obtain waivers from the required lenders under our senior credit agreement to avoid being in
default. If we breach
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;4
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">our covenants under our senior credit agreement and seek a waiver, we may not be able to
obtain a waiver from the required lenders. If this occurs, we would be in default under our senior
credit agreement, the lenders could exercise their rights as described above, and we could be
forced into bankruptcy or liquidation.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The indenture governing the exchange notes will impose, and our senior credit agreement imposes,
significant operating and financial restrictions, which may prevent us from capitalizing on
business opportunities and taking some actions.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The indenture governing the exchange notes will contain, and our senior credit agreements
contains, customary restrictions on our activities, including covenants that restrict our and our
subsidiaries&#146; ability to:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>incur additional debt;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>pay dividends on, or redeem or repurchase stock;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>create liens;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>make specified types of investments;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>apply net proceeds from certain asset sales;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>engage in transactions with our affiliates;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>engage in sale and leaseback transactions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>merge or consolidate;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>restrict dividends or other payments from subsidiaries;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>sell equity interests of subsidiaries; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>sell, assign, transfer, lease, convey or dispose of assets.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our senior credit agreement also requires us to meet a minimum current ratio and a minimum
interest coverage ratio. We may not be able to maintain these ratios, and if we fail to be in
compliance with these tests, we will not be able to borrow funds under our senior credit agreement
which would make it difficult for us to operate our business.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The restrictions in the indenture governing the exchange notes and our senior credit agreement
may prevent us from taking actions that we believe would be in the best interest of our business,
and may make it difficult for us to successfully execute our business strategy or effectively
compete with companies that are not similarly restricted. We may also incur future debt obligations
that might subject us to additional restrictive covenants that could affect our financial and
operational flexibility. We cannot assure you that we will be granted waivers or amendments to
these agreements if for any reason we are unable to comply with these agreements, or that we will
be able to refinance our debt on terms acceptable to us, or at all.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The breach of any of these covenants and restrictions could result in a default under the
indenture governing the exchange notes or under our senior credit agreement. An event of default
under our debt agreements would permit some of our lenders to declare all amounts borrowed from
them to be due and payable. If we are unable to repay debt, lenders having secured obligations,
such as the lenders under our senior credit agreement, could proceed against the collateral
securing the debt. Because the indenture governing the exchange notes and our senior credit
agreement have customary cross-default provisions, if the indebtedness under the exchange notes or
under our senior credit agreements or any of our other facilities is accelerated, we may be unable
to repay or finance the amounts due.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>We may not have the ability to raise the funds necessary to finance the change of control
offer required by the indenture governing the exchange notes.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon the occurrence of certain kinds of change of control events, we will be required to offer
to repurchase all outstanding exchange notes at 101% of the principal amount thereof plus accrued
and unpaid interest, if any, to the date of repurchase, unless all exchange notes have been
previously called for redemption. The holders of other debt securities that we may issue in the
future, which rank equally in right of payment with the exchange notes, may also have this right.
Our failure to purchase tendered exchange notes would constitute an event of default under the
indenture governing the exchange notes, which in turn, would constitute a default under our senior
credit agreement. In addition, the occurrence of a change of control would also constitute an event
of default under our senior credit agreement. A default under our senior credit agreement would
result in a default under the indenture if the lenders accelerate the debt under our senior credit
agreement.
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;5
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Therefore, it is possible that we may not have sufficient funds at the time of the change of
control to make the required repurchase of exchange notes. Moreover, our senior credit agreement
restricts, and any future indebtedness we incur may restrict, our ability to repurchase the
exchange notes, including following a change of control event. As a result, following a change of
control event, we would not be able to repurchase exchange notes unless we first repay all
indebtedness outstanding under our senior credit agreement and any of our other indebtedness that
contains similar provisions, or obtain a waiver from the holders of such indebtedness to permit us
to repurchase the exchange notes. We may be unable to repay all of that indebtedness or obtain a
waiver of that type. Any requirement to offer to repurchase outstanding exchange notes may
therefore require us to refinance our other outstanding debt, which we may not be able to do on
commercially reasonable terms, if at all. These repurchase requirements may also delay or make it
more difficult for others to obtain control of us.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, certain important corporate events, such as leveraged recapitalizations that
would increase the level of our indebtedness, would not constitute a &#147;Change of Control&#148; under the
indenture.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Your ability to transfer the exchange notes may be limited by the absence of an active trading
market and there is no assurance that any active trading market will develop for the exchange
notes.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The exchange notes are a new issue of securities for which there is no established public
market. We do not intend to have the exchange notes listed on a national securities exchange or
included on any automated dealer quotation system, although we expect that they will eligible for
trading in The PORTAL Market. We cannot assure you that an active market for the exchange notes
will develop or, if developed, that it will continue. Even if a trading market for the exchange
notes does develop, you may not be able to sell your exchange notes at a particular time, if at
all, or you may not be able to obtain the price you desire for your exchange notes. Historically,
the market for non-investment grade debt has been subject to disruptions that have caused
substantial volatility in the prices of securities similar to the exchange notes. We cannot assure
you that the market, if any, for the exchange notes will be free from similar disruptions or that
any such disruptions may not adversely affect the prices at which you may sell your notes.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Federal and state statutes allow courts, under specific circumstances, to void the guarantees and
require noteholders to return payments received from the guarantors.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Creditors are protected by fraudulent conveyance laws which differ among various
jurisdictions, and these laws may apply to the issuance of the guarantees by our subsidiary
guarantors. Under federal bankruptcy law and comparable provisions of state fraudulent transfer
laws, a guarantee may be voided by a court, or subordinated to the claims of other creditors, if,
among other things:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the indebtedness evidenced by such guarantee was incurred by a subsidiary guarantor
with actual intent to hinder, delay or defraud any present or future creditor of such
subsidiary guarantor; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>such subsidiary guarantor did not receive fair consideration or reasonably equivalent
value for issuing the guarantee, and the applicable subsidiary guarantor</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>was insolvent, or was rendered insolvent by reason of issuing the applicable
guarantee;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>was engaged or about to engage in a business or transaction for which the remaining
assets of the applicable subsidiary guarantor constituted unreasonably small capital; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>intended to incur, or believed that we or it would incur, indebtedness beyond our or
its ability to pay such debts as they matured.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, any payment by such subsidiary guarantor pursuant to any guarantee could be
voided and required to be returned to such subsidiary guarantor, or to a fund for the benefit of
creditors of such subsidiary guarantor. A legal challenge to a guarantee on fraudulent conveyance
grounds may focus on the benefits, if any, realized by us or the subsidiary guarantors as a result
of our issuance of the guarantees. To the extent a subsidiary&#146;s guarantee of the exchange notes is
avoided as a result of fraudulent conveyance or held unenforceable for any other reason, you would
cease to have any claim in respect of that guarantee and would be creditors solely of ours.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Because all of our significant assets are held by our guarantor subsidiaries, the stake of a
guarantee being voided under fraudulent transfer laws is higher. In addition, any future guarantees
provided under the indenture governing
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;6
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">the exchange notes have a greater risk of being voided. Moreover, the borrower under our
senior credit agreement is Brigham Oil &#038; Gas, L.P., our primary operating subsidiary and guarantor
of the exchange notes. In the event Brigham Oil &#038; Gas, L.P.&#146;s guarantee of the exchange notes is
avoided or held unenforceable, the exchange notes would be effectively subordinated to any then
outstanding borrowings under our senior credit agreement, which would be paid in full prior to
amounts due on the exchange notes in the event of any foreclosure, dissolution, winding-up,
liquidation, reorganization or other bankruptcy proceeding with respect to Brigham Oil &#038; Gas, L.P.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The measures of insolvency for purposes of these fraudulent transfer laws will vary depending
upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred.
Generally, however, a guarantor would be considered insolvent if:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the sum of its debts, including contingent liabilities, was greater than the fair
saleable value of all of its assets; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if the present fair saleable value of its assets was less than the amount that would be
required to pay its probable liability on its existing debts, including contingent
liabilities, as they become absolute and mature; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>it could not pay its debts as they become due.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Risks Relating to Our Company and Our Industry</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Oil and natural gas prices are volatile and a substantial reduction in these prices could adversely
affect our results and the price of our common stock.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our revenues, operating results and future rate of growth depend highly upon the prices we
receive for our oil and natural gas production. Historically, the markets for oil and natural gas
have been volatile and are likely to continue to be volatile in the future. The NYMEX daily
settlement price for the prompt month natural gas contract in 2004 ranged from a high of $8.14 per
MMBtu to a low of $4.40 per MMBtu. In 2005, the same index ranged from a high of $15.38 per MMBtu
to a low of $5.79 per MMBtu. The NYMEX daily settlement price for the prompt month oil contract in
2004 ranged from a high of $56.17 per barrel to a low of $32.48 per barrel. In 2005, the same index
ranged from a high of $69.81 per barrel to a low of $42.12 per barrel. The markets and prices for
oil and natural gas depend on factors beyond our control. These factors include demand for oil and
natural gas, which fluctuate with changes in market and economic conditions and other factors,
including:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>worldwide and domestic supplies of oil and natural gas;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>actions taken by foreign oil and natural gas producing nations;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>political conditions and events (including instability or armed conflict) in
oil-producing or natural gas- producing regions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the level of global oil and natural gas inventories;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the price and level of foreign imports;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the level of consumer demand;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the price and availability of alternative fuels;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the availability of pipeline capacity;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>weather conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>domestic and foreign governmental regulations and taxes; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the overall economic environment.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Significant declines in oil and natural gas prices for an extended period may have the
following effects on our business:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>limit our financial condition, liquidity, ability to finance planned capital
expenditures and results of operations;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>reduce the amount of oil and natural gas that we can produce economically;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>cause us to delay or postpone some of our capital projects;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>reduce our revenues, operating income and cash flow;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>reduce the carrying value of our oil and natural gas properties; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>limit our access to sources of capital, such as equity and long-term debt.</TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt">&nbsp;7
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We may have difficulty financing our planned capital expenditures, which could adversely affect our
business.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We make and will continue to make substantial capital expenditures in our exploration and
development projects. Without additional capital resources, our drilling and other activities may
be limited and our business, financial condition and results of operations may suffer. We may not
be able to secure additional financing on reasonable terms or at all and financing may not continue
to be available to us under our existing or new financing arrangements. If additional capital
resources are not available, we may be forced to curtail our exploration and development activities
and other activities or be forced to sell some of our assets on an untimely or unfavorable basis.
Any such curtailment or sale could have a material adverse effect on our business, financial
condition and results of operation. In addition, we have a limited number of shares of authorized
but unissued common stock available at this time. While we are in the process of seeking approval
from our stockholders to increase our number of shares of authorized common stock, unless and until
such change is approved, we would not have a sufficient number of shares of authorized common stock
to raise a substantial amount of proceeds to us in any subsequent public or private equity
offering.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our exploration, development and drilling efforts and the operation of our wells may not be
profitable or achieve our targeted returns.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We require significant amounts of undeveloped leasehold acreage in order to further our
exploration and development efforts. Exploration and development activities are subject to many
risks, including the risk that commercially productive reservoirs will not be discovered. We invest
in property, including undeveloped leasehold acreage, which we believe will result in projects that
will add value over time. However, we cannot guarantee that all of our prospects will result in
viable projects or that we will not abandon our initial investments. Additionally, we cannot
guarantee that the leasehold acreage we acquire will be profitably developed, that new wells we
drill will be productive or that we will recover all or any portion of our investment in such
leasehold acreage or wells. Drilling for oil and natural gas may involve unprofitable efforts, not
only from dry wells but also from wells that are completed but do not produce sufficient net
reserves to return a profit after deducting operating and other costs. In addition, wells that are
profitable may not achieve our targeted rate of return. Our ability to achieve our target results
is dependent upon the current and future market prices for oil and natural gas and our ability to
economically add and produce reserves. We rely to a significant extent on 3-D seismic data and
other advanced technologies to identify leasehold acreage prospects and conduct our exploration
activities. The 3-D seismic data and other technologies we use do not allow us to know conclusively
prior to the acquisition of leasehold acreage or the drilling of a well whether oil or natural gas
is present or may be produced economically. The use of 3-D seismic data and other technologies also
requires greater pre-drilling expenditures than traditional drilling strategies.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, we may not be successful in implementing our business strategy of controlling and
reducing the costs associated with drilling to find new reserves and with producing our existing
reserves in order to improve our overall return. The cost of drilling, completing and operating a
well is often uncertain and cost factors can adversely affect the economics of a project. We cannot
predict the cost of drilling, and we may be forced to limit, delay or cancel drilling operations as
a result of a variety of factors, including:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>unexpected drilling conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>pressure or irregularities in formations;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>equipment failures or accidents;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>adverse weather conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>compliance with governmental requirements; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>shortages or delays in the availability of drilling rigs and the delivery of equipment.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Exploratory drilling is a speculative activity that may not result in commercially productive
reserves and may require expenditures in excess of budgeted amounts.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our future rate of growth greatly depends on the success of our exploratory drilling program.
Exploratory drilling involves a higher degree of risk that we will not encounter commercially
productive oil or natural gas reservoirs than development drilling. We may not be successful in our
future drilling activities because even with the use of 3-D seismic and other advanced
technologies, exploratory drilling is a speculative activity.
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;8
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Although our oil and natural gas reserve data is independently estimated, these estimates may still
prove to be inaccurate.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our proved reserve estimates are generated each year by Cawley, Gillespie &#038; Associates, Inc.,
an independent petroleum consulting firm. In conducting its evaluation, the engineers and
geologists of Cawley, Gillespie &#038; Associates, Inc. evaluate our properties and independently
develop estimates of our proved reserves. There are numerous uncertainties and risks that are
inherent in estimating quantities of oil and natural gas reserves and projecting future rates of
production and timing of development expenditures as many factors are beyond our control. Many
factors and assumptions are incorporated into the estimates of our proved reserves including:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>expected reservoir characteristics based on geological, geophysical and engineering
assessments;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>future production rates based on historical performance and expected future operating
and investment activities;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>future oil and natural gas prices and quality and location differentials; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>future development and operating costs.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although we believe the Cawley, Gillespie &#038; Associates, Inc. reserve estimates are reasonable
based on the information available to them at the time they prepare their estimates, our actual
results could vary materially from these estimated quantities of proved oil and natural gas
reserves (in the aggregate and for a particular location), production, revenues, taxes and
development and operating expenditures. In addition, these estimates of proved reserves may be
subject to downward or upward revision based upon production history, results of future exploration
and development activities, prevailing oil and natural gas prices, operating and development costs
and other factors.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Finally, recovery of proved undeveloped reserves generally requires significant capital
expenditures and successful drilling operations. At December&nbsp;31, 2005, approximately 49% of our
estimated proved reserves were classified as undeveloped. At December&nbsp;31, 2005, we estimated that
it would require additional capital expenditures of approximately $122&nbsp;million to develop our
proved undeveloped reserves. The estimates for our proved reserves assume that we can and will make
these expenditures and conduct these operations successfully, which may not occur.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We need to replace our reserves at a faster rate than companies whose reserves have longer
production periods. Our failure to replace our reserves would result in decreasing reserves and
production over time.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In general, production from oil and natural gas properties declines as reserves are depleted,
with the rate of decline depending on the characteristics of the reservoir. Except to the extent we
conduct successful exploration and development activities or acquire properties containing proved
reserves, or both, our proved reserves and production will decline as reserves are produced.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We may not be able to find, develop or acquire additional reserves to replace our current and
future production. Accordingly, our future oil and natural gas reserves and production and
therefore our future cash flow and income, are dependent upon our success in economically finding
or acquiring new reserves and efficiently developing our existing reserves.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our reserves in the Gulf Coast have high initial production rates followed by steep declines
in production, resulting in a reserve life for wells in this area that is shorter than the industry
average. This production volatility has impacted and, in the future, may continue to impact our
quarterly and annual production levels.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We generally must locate and develop or acquire new oil and natural gas reserves to replace
those being depleted by production. Without successful drilling and exploration or acquisition
activities, our reserves and revenues will decline rapidly. We may not be successful in extending
the reserve life of our properties generally and our Gulf Coast properties in particular. Our
current strategy includes increasing our reserve base through drilling activities on our existing
Gulf Coast properties and properties located in our other core areas, which have historically had
longer-lived reserves. Our existing and future exploration and development projects may not result
in significant additional reserves and we may not be able to drill productive wells at economically
viable costs.
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;9
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our future cash flows are subject to a number of variables, such as the level of production
from existing wells, prices of oil and natural gas and our success in finding and producing new
reserves. If our revenues were to decrease as a result of lower oil and natural gas prices,
decreased production or otherwise, and our access to capital were limited, we would have a reduced
ability to replace our reserves or to maintain production at current levels, potentially resulting
in a decrease in production and revenue over time.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Drilling locations that we decide to drill may not yield oil or natural gas in commercially viable
quantities or quantities sufficient to meet our targeted rate of return.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our drilling locations are in various stages of evaluation, ranging from locations that are
ready to be drilled to locations that will require substantial additional evaluation and
interpretation. There is no way to predict in advance of drilling and testing whether any
particular drilling location will yield oil or natural gas in sufficient quantities to recover our
drilling or completion costs or to be economically viable. Our use of seismic data and other
technologies and the study of producing fields in the same area will not enable us to know
conclusively prior to drilling whether oil and natural gas will be present or, if present, whether
oil and natural gas will be present in commercial quantities. The analysis that we perform using
data from other wells, more fully explored prospects and/or producing fields may not be useful in
predicting the characteristics and potential reserves associated with our drilling locations. As a
result, we may not find commercially viable quantities of oil and natural gas and, therefore, we
may not achieve a targeted rate of return or have a positive return on investment.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The unavailability or high cost of drilling rigs, equipment, supplies, insurance, personnel and oil
field services could adversely affect our ability to execute our exploration and development plans
on a timely basis and within our budget.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our industry is cyclical and, from time to time, there is a shortage of drilling rigs,
equipment, supplies, insurance or qualified personnel. During these periods, the costs and delivery
times of rigs, equipment and supplies are substantially greater. In addition, the demand for, and
wage rates of, qualified drilling rig crews rise as the number of active rigs in service increases.
As a result of increasing levels of exploration and development activities in response to strong
prices of oil and natural gas, the demand for oilfield services has risen, and the costs of these
services are increasing, while the quality of these services may suffer. If the unavailability or
high cost of drilling rigs, equipment, supplies, insurance or qualified personnel were particularly
severe in Texas and Oklahoma, we could be materially and adversely affected because our operations
and properties are concentrated in those areas.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The marketability of our oil and natural gas production depends on services and facilities that we
typically do not own or control. The failure or inaccessibility of any such services or facilities
could result in a curtailment of our production and revenues.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The marketability of our production depends in part upon the availability, proximity and
capacity of natural gas gathering systems, pipelines and processing facilities. We generally
deliver natural gas through gathering systems and pipelines that we do not own under interruptible
or short term transportation agreements. Under the interruptible transportation agreements, the
transportation of our natural gas may be interrupted due to capacity constraints on the applicable
system, for maintenance or repair of the system, or for other reasons as dictated by the particular
agreements. If any of the pipelines or other facilities that we use become unavailable, we would be
required to find a suitable alternative to transport and process the natural gas that we produce,
which could increase our costs and reduce the revenues we might obtain from the sale of our natural
gas. For example, Hurricane Rita disrupted the operations of natural gas pipelines and
fractionators and required the evacuation of personnel required to oversee some of our facilities
in the Gulf Coast area. As a result of these disruptions, we were forced temporarily to curtail
some of our production in our onshore Gulf Coast province for approximately six days.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Lower oil and natural gas prices may cause us to record ceiling limitation write-downs, which would
reduce our stockholders&#146; equity.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We use the full cost method of accounting to account for our oil and natural gas investments.
Accordingly, we capitalize the cost to acquire, explore for and develop oil and natural gas
properties. Under full cost accounting rules, the net capitalized cost of oil and natural gas
properties may not exceed a &#147;ceiling limit&#148; that is based upon the present value of estimated
future net revenues from proved reserves, discounted at 10%, plus the lower of the cost or
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;10
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">the fair market value of our unproved properties. If the net capitalized costs of our oil and
natural gas properties exceed the ceiling limit, we must charge the amount of the excess to
earnings. This is called a &#147;ceiling limitation write-down.&#148; The risk that we will be required to
write down the carrying value of our oil and natural gas properties increases when oil and natural
gas prices are low or volatile. In addition, write-downs may occur if we experience substantial
downward adjustments to our estimated proved reserves. Once incurred, a write-down of our oil and
natural gas properties is not reversible at a later date. Write-downs required by full cost method
of accounting do not impact our cash flow from operating activities, but do reduce our net income
and stockholders&#146; equity.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We are subject to various operating and other casualty risks that could result in liability
exposure or the loss of production and revenues.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our operations are subject to hazards and risks inherent in drilling for and producing and
transporting oil and natural gas, such as:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>fires;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>natural disasters;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>formations with abnormal pressures;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>blowouts, cratering and explosions; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>pipeline ruptures and spills.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any of these hazards and risks can result in the loss of hydrocarbons, environmental
pollution, personal injury claims and other damage to our properties and the property of others.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We may not have enough insurance to cover all of the risks we face, which could result in
significant financial exposure.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We maintain insurance coverage against some, but not all, potential losses in order to protect
against the risks we face. We may elect not to carry insurance if our management believes that the
cost of insurance is excessive relative to the risks presented. If an event occurs that is not
covered, or not fully covered, by insurance, it could harm our financial condition, results of
operations and cash flows. In addition, we cannot fully insure against pollution and environmental
risks.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We cannot control activities on properties we do not operate. Failure to fund capital expenditure
requirements may result in reduction or forfeiture of our interests in some of our non-operated
projects.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We do not operate some of the properties in which we own an interest and we have limited
ability to exercise influence over the operations or the costs associated with operating these
properties. As of December&nbsp;31, 2005, approximately 31% of our oil and natural gas properties, based
on pre-tax PV10% value, were operated by other companies. Our dependence on the operator and other
working interest owners for these projects and our limited ability to influence operations and
associated costs could materially adversely affect the realization of our targeted return on
capital in drilling or acquisition activities and our targeted production growth rate. The success
and timing of drilling, development and exploitation activities on properties operated by others
depend on a number of factors that are beyond our control, including the operator&#146;s expertise and
financial resources, approval of other participants for drilling wells and utilization of
technology.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;When we are not the majority owner or operator of a particular oil or natural gas project, we
may have no control over the timing or amount of capital expenditures associated with such project.
If we are not willing or able to fund our capital expenditures relating to such projects when
required by the majority owner or operator, our interests in these projects may be reduced or
forfeited.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our future operating results may fluctuate and significant declines in them would limit our ability
to invest in projects.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our future operating results may fluctuate significantly depending upon a number of factors,
including:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>industry conditions;</TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt">&nbsp;11
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>prices of oil and natural gas;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>rates of drilling success;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>capital availability;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>rates of production from completed wells; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the timing and amount of capital expenditures.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This variability could cause our business, financial condition and results of operations to
suffer. In addition, any failure or delay in the realization of expected cash flows from operating
activities could limit our ability to invest and participate in other economically attractive
projects.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our hedging activities may prevent us from benefiting from price increases and may expose us
to other risks.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In an attempt to reduce our sensitivity to oil and natural gas price volatility, we enter into
hedging arrangements with respect to a portion of expected production, such as the use of
derivative contracts that generally result in a fixed price or a range of minimum and maximum price
limits over a specified time period. See &#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operation &#151; Derivative Instruments and Hedging Activities.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our hedging activities expose us to the risk of financial loss in certain circumstances. For
example, if we do not produce our oil and natural gas reserves at rates equivalent to our
derivative position, we would be required to satisfy our obligations under those derivative
contracts on potentially unfavorable terms without the ability to offset that risk through sales of
comparable quantities of our own production. This situation occurred during portions of 2000, due
in part to our sale of certain producing reserves in mid-1999 and reduced our cash flow in 2000 by
approximately $1&nbsp;million. Additionally, because the terms of our derivative contracts are based on
assumptions and estimates of numerous factors such as cost of production and pipeline and other
transportation and marketing costs to delivery points, substantial differences between the prices
we receive pursuant to our derivative contracts and our actual results could harm our profit
margins and our ability to manage the risk associated with fluctuations in oil and natural gas
prices. We also could be financially harmed if the counter parties to our derivative contracts
prove unable or unwilling to perform their obligations under such contracts. Additionally, in the
past, some of our derivative contracts required us to deliver cash collateral or other assurances
of performance to the counter parties if our payment obligations exceeded certain levels. Future
collateral requirements are uncertain but will depend on arrangements with our counter parties and
highly volatile oil and natural gas prices.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We face significant competition and many of our competitors have resources in excess of our
available resources.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We operate in the highly competitive areas of oil and natural gas exploration, exploitation,
acquisition and production. We face intense competition from a large number of independent,
technology-driven companies as well as both major-integrated and other independent oil and natural
gas companies in a number of areas such as:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>seeking to acquire desirable producing properties or new leases for future exploration;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>marketing our oil and natural gas production; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>seeking to acquire the equipment and expertise necessary to operate and develop those properties.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Many of our competitors have financial and other resources substantially in excess of those
available to us. This highly competitive environment could harm our business.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We are subject to various governmental regulations and environmental risks that may cause us to
incur substantial costs.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From time to time, in varying degrees, political developments and federal and state laws and
regulations affect our operations. In particular, price controls, taxes and other laws relating to
the oil and natural gas industry, changes in these laws and changes in administrative regulations
have affected and in the future could affect oil and natural gas production, operations and
economics. We cannot predict how agencies or courts will interpret existing laws and regulations or
the effect of these adoptions and interpretations may have on our business or financial condition.
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;12
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our business is subject to laws and regulations promulgated by federal, state and local
authorities, including the FERC, the EPA, the Texas Railroad Commission, the TCEQ and the Oklahoma
Corporation Commission, relating to the exploration for, and the development, production and
marketing of, oil and natural gas, as well as safety matters. Legal requirements are frequently
changed and subject to interpretation and we are unable to predict the ultimate cost of compliance
with these requirements or their effect on our operations. We may be required to make significant
expenditures to comply with governmental laws and regulations.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our operations are subject to complex federal, state and local environmental laws and
regulations, including CERCLA, RCRA, OPA and the Clean Water Act. Environmental laws and
regulations change frequently, and the implementation of new, or the modification of existing, laws
or regulations could harm us. The discharge of oil, natural gas or other pollutants into the air,
soil or water may give rise to significant liabilities on our part to the government and third
parties and may require us to incur substantial costs of remediation.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We depend on our key management personnel and technical experts and the loss any of these
individuals could adversely affect our business.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If we lose the services of our key management personnel or technical experts or are unable to
attract additional qualified personnel, our business, financial condition, results of operations,
exploration and development efforts and ability to grow could suffer. We have assembled a team of
geologists, geophysicists and engineers who have considerable experience in applying 3-D seismic
imaging technology to explore for and to develop oil and natural gas. We depend upon the knowledge,
skill and experience of these experts to provide 3-D seismic imaging and to assist us in reducing
the risks associated with our participation in oil and natural gas exploration and development
projects. In addition, the success of our business depends, to a significant extent, upon the
abilities and continued efforts of our management, particularly Ben M. Brigham, our Chief Executive
Officer, President and Chairman of the Board. We have an employment agreement with Mr.&nbsp;Brigham, but
do not have an employment agreement with any of our other employees.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>The market price of our common stock is volatile.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The trading price of our common stock and the price at which we may sell securities in the
future is subject to large fluctuations in response to any of the following:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>limited trading volume in our stock;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>changes in government regulations;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>quarterly variations in operating results;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our involvement in litigation;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>general market conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the prices of oil and natural gas;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>announcements by us and our competitors;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our liquidity;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our ability to raise additional funds; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>other events.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our common stock price may decline when our financial results decline or when events occur
that are adverse to us, our industry, or the equity markets.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You can expect the market price of our common stock to decline when our financial results
decline or otherwise fail to meet the expectations of the financial community or the investing
public or at any other time when events actually or potentially adverse to us or the oil and
natural gas industry or the economy occur. Our common stock price may decline to a price below the
price you paid to purchase your shares of common stock in this offering.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>We do not intend to pay any dividends on our common stock.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We anticipate that we will retain all future earnings and other cash resources for the future
operation and development of our business. Accordingly, we do not intend to declare or pay any cash
dividends on our common
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;13
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">stock in the foreseeable future. Payment of any future dividends will be at the discretion of
our board of directors after taking into account many factors, including our operating results,
financial condition, current and anticipated cash needs and plans for expansion.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Our shares that are eligible for future sale may have an adverse effect on the price of our
common stock.</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales of substantial amounts of common stock, or a perception that such sales could occur,
could adversely affect the market price of the common stock and could impair our ability to raise
capital through the sale of our equity securities. Certain of our stockholders own 16.6% of our
outstanding common stock. All of these shares have are being registered under the Securities Act
pursuant to a registration statement and all or a portion of their shares may be sold.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Certain of our affiliates control a substantial portion of our outstanding common stock, which may
affect your interests as a noteholder or stockholder.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our directors, executive officers and 10% or greater stockholders, and certain of their
affiliates, beneficially own a substantial portion of our outstanding common stock. Accordingly,
these stockholders, as a group, may be able to control the outcome of stockholder votes, including
votes concerning the election of directors, the adoption or amendment of provisions in our
certificate of incorporation or bylaws, and the approval of mergers and other significant corporate
transactions. The existence of these levels of ownership concentrated in a few persons makes it
unlikely that any other holder of our common stock may be able to affect our management or
direction. These factors may also have the effect of delaying or preventing a change in our
management or voting control. Moreover, the interests of these stockholders could conflict with the
noteholders. For example, our stockholders may have an interest in pursuing acquisitions,
divestitures, financings or other transactions that, in their judgment, could enhance their equity
investments, even though such transactions might involve risks to noteholders.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Certain anti-takeover provisions may adversely affect your rights as a noteholder or stockholder.</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our certificate of incorporation authorizes our Board of Directors to issue up to 10&nbsp;million
shares of preferred stock without stockholder approval and to set the rights, preferences and other
designations, including voting rights, of those shares as the Board of Directors may determine. In
addition, our Series&nbsp;A preferred stock and our senior credit agreement contain terms restricting
our ability to enter into change of control transactions, including requirements to redeem or repay
our outstanding Series&nbsp;A preferred stock and the amounts borrowed under our senior credit agreement
upon a change in control. These provisions, alone or in combination with the other matters
described in the preceding paragraph may discourage transactions involving actual or potential
changes in our control. We are also subject to provisions of the Delaware General Corporation Law
that may make some business combinations more difficult.
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;14
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left">
<A name="103"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SELLING STOCKHOLDERS</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">This prospectus relates to shares of Common Stock that have been acquired by the Selling
Stockholders named below pursuant to the Plan. Each of the Selling Stockholders is a director of
the Company. The following table sets forth:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The nature of any material relationship that such Selling Stockholder has had with us for the past three years;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the number of shares of Common Stock each Selling Stockholder beneficially owned as of May&nbsp;31, 2006;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the number of shares of Common Stock acquired by each Selling Stockholder pursuant to the
Plan and being registered under this Registration Statement, some or all of which shares may
be sold pursuant to this prospectus; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the number of shares of Common Stock and the percentage, if 1% or more, of the total class
of Common Stock outstanding to be beneficially owned by each Selling Stockholder following
this offering, assuming the sale pursuant to this offering of all shares acquired by such
Selling Stockholder pursuant to the Plan and registered under this Registration Statement.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">There is no assurance that any of the Selling Stockholders will sell any or all of the shares
offered by them under this Registration Statement. The address of each Selling Stockholder is c/o
Brigham Exploration Company, 6300 Bridge Point Parkway, Building 2, Suite&nbsp;500, Austin, Texas 78730.
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left"></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="6">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left"></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2">Number of Shares</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2">Number of Shares</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="6">Percentage of Shares</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Selling Stockholder</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2" style="border-bottom: 1px solid #000000">Beneficially Owned</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2" style="border-bottom: 1px solid #000000">Being Registered</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="6" style="border-bottom: 1px solid #000000">Beneficially Owned</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2">Before</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2">After</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2" style="border-bottom: 1px solid #000000">Offering</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="2" style="border-bottom: 1px solid #000000">Offering</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD><DIV style="margin-left:15px; text-indent:-15px">Harold Carter(1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">315,693</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">*</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">*</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD><DIV style="margin-left:15px; text-indent:-15px">Stephen Reynolds(1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">69,027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">*</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">*</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD><DIV style="margin-left:15px; text-indent:-15px">Hobart Smith(1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">6,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">6,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">*</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right">*</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Represents less than 1%.</TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(1)</TD>
    <TD>&nbsp;</TD>
    <TD>Mr. Carter, Mr. Reynolds and Mr. Smith are all directors of the Company.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">&nbsp;15
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">





<DIV align="left">
<A name="104"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>USE OF PROCEEDS</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We will not receive any proceeds from sales by the selling stockholders.
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;16
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<A name="105"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>PLAN OF DISTRIBUTION</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares covered by this prospectus may be offered and sold from time to time by the Selling
Stockholders. We will not receive any proceeds from sales of any shares by Selling Stockholders.
The term &#147;Selling Stockholders&#148; includes the selling stockholders listed in the table above and any
donees, pledgees, transferees or other successors-in-interest selling shares received after the
date of this prospectus from a Selling Stockholder. The Selling Stockholders or their pledgees,
donees, transferees or other successors in interest may sell shares pursuant to this prospectus
from time to time:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in transactions (including one or more block transactions) on the NASDAQ National Market;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in the public market off the NASDAQ;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in privately negotiated transactions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>through put or call options transactions relating to the shares; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>in a combination of such transactions.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each sale may be made either at the market price prevailing at the time of sale or at a
negotiated price. Sales may be made through brokers or to dealers, and such brokers or dealers may
receive compensation in the form of commissions or discounts not exceeding those customary in
similar transactions. Any shares covered by this prospectus that qualify for sale pursuant to Rule
144 under the Securities Act may be sold under Rule&nbsp;144 rather than pursuant to this prospectus.
All expenses of registration incurred in connection with this offering are being borne by the
Company, but all brokerage commissions and other expenses incurred by a Selling Stockholder will be
borne by that Selling Stockholder.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Selling Stockholders and any dealer acting in connection with the offering or any broker
executing a sell order on behalf of a Selling Stockholder may be deemed to be &#147;underwriters&#148; within
the meaning of the Securities Act, in which event any profit on the sale of shares by a Selling
Stockholder and any commissions or discounts received by any such broker or dealer may be deemed to
be underwriting compensation under the Securities Act. In addition, any such broker or dealer may
be required to deliver a copy of this prospectus to any person who purchases any of the shares from
or through such broker or dealer.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In order to comply with the securities laws of certain states, if applicable, the shares will
be sold only through registered or licensed brokers or dealers.
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;17
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left">
<A name="110"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>FORWARD-LOOKING
STATEMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This prospectus and the documents incorporated by reference in this prospectus contain
forward-looking statements within the meaning of the federal securities laws.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These forward-looking statements include, among others, the following:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 3%">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our growth strategies;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our ability to successfully and economically explore for and develop oil and gas resources;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>anticipated trends in our business;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our future results of operations;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our liquidity and ability to finance our exploration and development activities;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>market conditions in the oil and gas industry;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our ability to make and integrate acquisitions; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the impact of governmental regulation.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">These
statements may be found under &#147;Risk Factors&#148; and other
places. Forward-looking
statements are typically identified by use of terms such as &#147;may,&#148; &#147;will,&#148; &#147;expect,&#148; &#147;anticipate,&#148; &#147;estimate&#148;
and similar words, although some forward-looking statements may be expressed differently. You should be aware that
our actual results could differ materially from those contained in the forward-looking statements. You should
consider carefully the statements under &#147;Risk Factors&#148; and other sections of this prospectus, which describe factors that
could cause our actual results to differ from those set forth in the forward-looking statements.
</DIV>

<DIV align="left">
<A name="106"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>WHERE YOU CAN FIND MORE INFORMATION</B>
</DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We file annual, quarterly and special reports and other information with the Securities and
Exchange Commission. You can read and copy any materials we file with the Securities and Exchange
Commission at its Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. You can
obtain information about the operation of the Securities and Exchange Commission&#146;s Public Reference
Room by calling the Securities and Exchange Commission at 1-800-SEC-0330. The Securities and
Exchange Commission also maintains a web site that contains information we file electronically with
the Securities and Exchange Commission, which you can access over the Internet at
http://www.sec.gov. In addition, you can obtain information about us at the offices of the New York
Stock Exchange, 20 Broad Street, New York, New York 10005. We have agreed that, if we are not
subject to the informational requirements of Sections&nbsp;13 or 15(d) of the Securities Exchange Act of
1934 at any time while the notes constitute &#147;restricted securities&#148; within the meaning of the
Securities Act, we will furnish to holders and beneficial owners of the notes and to prospective
purchasers designated by such holders the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act to permit compliance with Rule&nbsp;144A in connection with resales
of the notes. You may request a copy of our filings at no cost, by writing or telephoning us at the
following address: Brigham Exploration Company, 6300 Bridge Point Parkway, Building Two, Suite&nbsp;500,
Austin, Texas 78730.
</DIV>

<DIV align="left">
<A name="109"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>INCORPORATION OF DOCUMENTS BY REFERENCE</B>
</DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This prospectus incorporates documents and important information, by reference that is not
part of this prospectus or delivered with this prospectus. This means that we are disclosing
important information to you by referring you to those documents. You should be aware that
information in a document incorporated by reference may have been modified or superseded by
information that is included in other documents that were filed at a later date and which are also
incorporated by reference or included in this prospectus.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We incorporate by reference:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Annual Report on Form 10-K for the year ended December&nbsp;31, 2005, previously filed
with the Securities and Exchange Commission.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Quarterly Report on Form 10-Q for the quarter ended March&nbsp;31, 2006, previously
filed with the Securities and Exchange Commission.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Current Reports on Form 8-K filed on February&nbsp;16, 2006, February&nbsp;22, 2006,
February&nbsp;23, 2006, March&nbsp;21, 2006, April&nbsp;4, 2006, April&nbsp;5, 2006, April&nbsp;14, 2006, April
24, 2006, May&nbsp;3, 2006, May&nbsp;19, 2006 and June&nbsp;1, 2006.</TD>
</TR>

</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All documents and reports that we file with the Securities and Exchange Commission after the
date of this prospectus and before the termination of the exchange offer shall be deemed
incorporated herein by reference and shall be deemed to be a part hereof from the date of filing of
such documents and reports. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded for purposes of this
prospectus to the extent that a statement contained herein or in any subsequently filed document or
report that also is or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this prospectus.
</DIV>
<DIV align="left">
<A name="107"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>EXPERTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The consolidated financial statements and management&#146;s assessment of the effectiveness of
internal control over financial reporting (which is included in Management&#146;s Report on Internal
Control over Financial Reporting) incorporated in this prospectus by reference to the Annual Report
on the Form 10-K for the year ended December&nbsp;31, 2005 have been so incorporated in reliance on the
report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on
the authority of said firm as experts in auditing and accounting.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cawley, Gillespie &#038; Associates, Inc., independent petroleum consultants, estimated our
reserves as of December&nbsp;31, 2005, 2004 and 2003 and the present value of the estimated future net
revenues from those estimated reserves included in this document.
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;18
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">These estimates are included in reliance upon their reports given upon their authority as experts
on the matters covered by the summary reserve report.
</DIV>

<DIV align="left">
<A name="108"></A>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>LEGAL MATTERS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain legal matters in connection with the securities offered pursuant to this prospectus
have been passed upon by Thompson &#038; Knight L.L.P., Dallas, Texas.
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;19
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>PART II</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>INFORMATION REQUIRED IN THE REGISTRATION STATEMENT</B>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Item&nbsp;3. Incorporation of Documents by Reference.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The following documents filed by the Company with the SEC pursuant to Section&nbsp;13 of the Exchange
Act, are incorporated herein by reference:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Annual Report on Form 10-K for the fiscal year ended December&nbsp;31, 2005, filed on March&nbsp;1, 2006;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Quarterly Report on Form 10-Q for the period ended March&nbsp;31, 2006, filed on May&nbsp;8, 2006;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our Current Reports on Form 8-K filed on February&nbsp;16, 2006, February&nbsp;22, 2006, February&nbsp;23, 2006, March&nbsp;21, 2006, April&nbsp;4, 2006, April&nbsp;5, 2006, April&nbsp;14,
2006, April&nbsp;24, 2006, May&nbsp;3, 2006, May&nbsp;19, 2006 and June&nbsp;1, 2006; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The description of our common stock contained in our registration statement on Form 8-A
filed under Section&nbsp;12 of the Securities Exchange Act of 1934 on April&nbsp;25, 1997.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">All documents filed by the Company pursuant to Sections&nbsp;13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of this Registration Statement and prior to the filing of a
post-effective amendment indicating that all securities offered hereby have been sold or
deregistering all securities then remaining unsold, shall be deemed to be incorporated by reference
into this Registration Statement and to be a part hereof from the date of filing of such documents.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Item&nbsp;4. Description of Securities.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Not applicable.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Item&nbsp;5. Interests of Named Experts and Counsel.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Not Applicable.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Item&nbsp;6. Indemnification of Directors and Officers.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In accordance with Section&nbsp;102(b)(7) of the General Corporation Law of the State of Delaware,
our Certificate of Incorporation includes a provision that, to the fullest extent permitted by law,
eliminates the personal liability of members of our Board of Directors to us or our stockholders
for monetary damages for breach of fiduciary duty as a director. Such provision does not eliminate
or limit the liability of a director (1)&nbsp;for any breach of a director&#146;s duty of loyalty to us or
our stockholders, (2)&nbsp;for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of a law, (3)&nbsp;for paying an unlawful dividend or approving an
illegal stock repurchase (as provided in Section&nbsp;174 of the Delaware General Corporation Law) or
(4)&nbsp;for any transaction from which the director derived an improper personal benefit.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under Section&nbsp;145 of the Delaware General Corporation Law, we have the power to indemnify any
person who was or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding (other than an action by or in the right of the corporation)
by reason of the fact that the person is or was a director, officer, employee or agent of any
corporation, partnership, joint venture, trust or other enterprise, reasonably incurred in
connection with such action, suit or proceeding. The power to indemnify applies only if the person
acted in good faith and in a manner the person reasonably believed to be in or not opposed to the
best interests of the corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe the person&#146;s conduct was unlawful.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the case of an action by or in the right of the corporation, no indemnification may be made
with respect to any claim, issue or matter as to which such person shall have been adjudged to be
liable to us unless and only to the extent that the court of chancery or the court in which such
action or suit was brought shall determine that despite the adjudication of liability such person
is fairly and reasonably entitled to indemnify for such expenses which the court shall deem proper.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;145 of the Delaware General Corporation Law further provides that to the extent one of
our directors or officers has been successful in the defense of any action, suit or proceeding
referred to above or in the defense of any claim,
</DIV>

<P align="center" style="font-size: 10pt">II-1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">issue or matter therein, that person shall be indemnified against expenses (including attorneys&#146;
fees) actually and reasonably incurred in connection therewith.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We also have the power to purchase and maintain insurance on behalf of any person covering any
liability incurred in that person&#146;s capacity as a director, officer, employee or agent of the
corporation, or arising out of that person&#146;s status as such, whether or not we would have the power
to indemnify against the liability.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Certificate of Incorporation and Bylaws provide that we will indemnify our officers and
directors and former officers and directors against any expenses, judgments or settlement payments
sustained or paid by such persons as a result of having acted as one of our officers or directors,
or, at our request, as an officer, director, agent or employee of another business entity. The
Certificate of Incorporation and Bylaws further provide that we may, by action of our Board of Directors, provide
indemnification to our employees and agents, individually or as a group, with the same scope and
effect as the indemnification of directors and officers.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each Indemnity Agreement between us and our executive officers provides for the
indemnification in certain instances against liability and expenses incurred in connection with
proceedings brought by or in the right of the corporation or by third parties by reason of a person
serving as one of our officers or directors.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Item&nbsp;7. Exemption from Registration Claimed.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The issuances were made in reliance on the exemption from the registration requirements of the
Securities Act of 1933, as amended, contained in Section&nbsp;4(2) thereof, covering transactions not
involving any public offering or not involving any &#147;offer&#148; or &#147;sale.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Item&nbsp;8. Exhibits.
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Number</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Description</TD>
</TR>
<TR valign="bottom">
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Brigham Exploration Company 1997 Director Stock Option Plan (filed as Exhibit&nbsp;10.15 to the
Company&#146;s Annual Report on Form&nbsp;10-K for the year ended December&nbsp;31, 2003 and incorporated
herein by reference).</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">5.1*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Opinion of Thompson &#038; Knight LLP</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.1*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of PricewaterhouseCoopers LLP</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.2*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Cawley Gillespie &#038; Associates, Inc.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.3*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Thompson &#038; Knight LLP (contained in Exhibit&nbsp;5.1).</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">24.1*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Powers of Attorney (included on the signature page hereto).</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Filed herewith.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>


</TABLE>



<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Item&nbsp;9. Undertakings.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The undersigned registrant hereby undertakes:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;To file, during any period in which offers or sales are being made, a post-effective
amendment to this Registration Statement to include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or any material change
to such information in this Registration Statement; provided, however, that the undertakings set
forth in paragraphs (a)(i) and (a)(ii) do not apply if the information required to be included in a
post-effective amendment by those
</DIV>

<P align="center" style="font-size: 10pt">II-2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to
Section&nbsp;13 or Section 15(d) of the Exchange Act that are incorporated by reference in this
Registration Statement.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;That, for the purpose of determining any liability under the Securities Act, each such
post-effective amendment will be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time will be deemed to be
the initial bona fide offering thereof.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;To remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;That, for purposes of determining any liability under the Securities Act, each filing of
the registrant&#146;s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act that is
incorporated by reference in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;Insofar as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the registrant pursuant to the
provisions referred to in Item&nbsp;6 of this Registration Statement, or otherwise, the registrant has
been advised that in the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Securities Act and will be governed by the final adjudication of such issue.
</DIV>

<P align="center" style="font-size: 10pt">II-3
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it
has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and
has duly caused this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Austin and State of Texas on the 1<SUP style="font-size: 85%; vertical-align: text-top">st</SUP> day of
June, 2006.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="48%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="31%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>

</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">BRIGHAM EXPLORATION COMPANY</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Ben M. Brigham</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Ben M. Brigham</TD>
</TR>
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Chairman of the Board, President</TD>
</TR>
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">and Chief Executive Officer</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been
signed by the following in the capacities and on the dates indicated. Each person whose signature
appears below constitutes and appoints Ben &#147;Bud&#148; M. Brigham and Eugene B. Shepherd, Jr., and each
of them (with full power to each of them to act alone), his true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities to sign on his behalf individually and in each capacity stated
below any amendment, including post-effective amendments, to this Registration Statement, and to
file the same, with all exhibits thereto and other documents in connection therewith with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of
them, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents and
either of them, or their substitutes, may lawfully do or cause to be done by virtue hereof.
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="28%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="38%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Signature</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Title</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Date</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Ben M. Brigham
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chief Executive Officer, President,
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
Ben M. Brigham
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chairman of the Board and Director
<BR>
<I>(Principal Executive Officer)</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Eugene B. Shepherd, Jr.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chief Financial Officer
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><DIV style="font-size: 10pt; border-top: 1px solid #000000">Eugene B. Shepherd, Jr.</DIV>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>(Principal Financial and Accounting Officer)</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"></DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ David T. Brigham
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top" style="font-size: 10pt; border-top: 1px solid #000000">David T. Brigham</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Harold D. Carter
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top" style="font-size: 10pt; border-top: 1px solid #000000">Harold D. Carter</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Stephen C. Hurley
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR style="font-size: 1px">
    <TD style="font-size: 10pt; border-top: 1px solid #000000">Stephen C. Hurley</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Stephen P. Reynolds
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top" style="font-size: 10pt; border-top: 1px solid #000000">Stephen P. Reynolds</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Hobart A. Smith
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top" style="font-size: 10pt; border-top: 1px solid #000000">Hobart A. Smith</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ Steven A. Webster
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top" style="font-size: 10pt; border-top: 1px solid #000000">Steven A. Webster</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">/s/ R. Graham Whaling
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">June&nbsp;1, 2006</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top" style="font-size: 10pt; border-top: 1px solid #000000">R. Graham Whaling</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">II-4
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Index
to Exhibits </B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Number</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Description</TD>
</TR>
<TR valign="bottom">
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Brigham Exploration Company 1997 Director Stock Option Plan (filed as Exhibit&nbsp;10.15 to the
Company&#146;s Annual Report on Form&nbsp;10-K for the year ended December&nbsp;31, 2003 and incorporated
herein by reference).</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">5.1*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Opinion of Thompson &#038; Knight LLP</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.1*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of PricewaterhouseCoopers LLP</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.2*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Cawley Gillespie &#038; Associates, Inc.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">23.3*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Thompson &#038; Knight LLP (contained in Exhibit&nbsp;5.1).</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">24.1*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Powers of Attorney (included on the signature page hereto).</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Filed herewith.</TD>
</TR>


</TABLE>




<P align="center" style="font-size: 10pt">
</DIV>

</BODY>
</HTML>
[{"type": "S-8", "sequence": "1", "filename": "h37069sv8.htm", "description": "BRIGHAM EXPLORATION COMPANY - 1997 DIRECTOR STOCK OPTION PLAN", "secsgml_size_bytes": 179715}]
{"company-data": {"conformed-name": "BRIGHAM EXPLORATION CO", "cik": "0001034755", "assigned-sic": "1311", "irs-number": "752692967", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-135073", "film-number": "06909210"}, "business-address": {"street1": "6300 BRIDGE POINT PARKWAY", "street2": "BLDG 2 SUITE 500", "city": "AUSTIN", "state": "TX", "zip": "78730", "phone": "5124273300"}, "mail-address": {"street1": "6300 BRIDGE POINT PARKWAY", "street2": "BLDG 2 SUITE 500", "city": "AUSTIN", "state": "TX", "zip": "78730"}}
sv8
Table of Contents
As
filed with the Securities and Exchange Commission on June 16,
2006
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BRIGHAM EXPLORATION COMPANY
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction
of incorporation or organization)
75-2692967
(I.R.S. Employer Identification No.)
6300 Bridge Point Parkway, Building 2, Suite 500
Austin, Texas
(Address of Principal Executive Offices)
78730
(Zip Code)
Brigham Exploration Company 1997 Director Stock Option Plan
(Full title of the plan)
Ben M. Brigham
Copy to:
President, Chief Executive Officer
and Chairman of the Board
Brigham Exploration Company
6300 Bridge Point Parkway, Building 2, Suite 500
Austin, Texas 78730
(Name and address of agent for service)
Joe Dannenmaier
Thompson & Knight L.L.P.
1700 Pacific Avenue, Suite 3300
Dallas, Texas 75201
(214) 969-1700
(512) 427-3300
(Telephone number, including
area code, of agent for service)
CALCULATION OF REGISTRATION FEE
Proposed
Title of
Amount
Proposed
maximum
securities to
to be
maximum offering
aggregate
Amount of
be registered
registered
price per share (1)
offering price (1)
registration fee
Common Stock, par
value $.01 per share
429,800 shares (2)
$
7.00
$
3,008,600
$
321.92
(1)
Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(h)
under the Securities Act of 1933 (the "Securities Act") and based on the average of the high and
low prices of the common stock reported on the Nasdaq National Stock Market on June 13, 2006.
(2)
Pursuant to Rule 416, shares issuable upon any stock split, stock dividend or similar
transaction with respect to these shares are also being registered hereunder.
Table of Contents
EXPLANATORY NOTE
We prepared this Registration Statement in accordance with the requirements of Form S-8 under
the Securities Act to register an aggregate of
422,800 shares of our common stock which may be issued
pursuant to our 1997 Director Stock Option Plan, or the Plan.
This Registration Statement also constitutes a "reoffer" prospectus prepared in accordance
with Instruction C of the General Instructions to Form S-8 and Part I to Form S-3. This prospectus
may be utilized by certain participants under the Plan to cover
reoffers and resales of the 7,000 shares
of common stock received as a result of the exercise of stock options granted under, the Plan. This
Registration Statement also contains the information required pursuant to Part II of Form S-8.
The document(s) containing the information specified in Part I of Form S-8 (plan information
and registrant information) will be sent or given to plan participants as specified by Rule
428(b)(1) under the Securities Act. In accordance with Rule 428 under the Securities Act and the
"Note" to Part I of Form S-8, these documents are not being filed with the SEC either as part of
this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule 424 under
the Securities Act. These documents and the documents incorporated by reference in this
Registration Statement pursuant to Item 3 of Part II of this Form S-8, taken together, constitute a
prospectus that meets the requirements of Section 10(a) of the Securities Act.
PART I
ITEM 1. PLAN INFORMATION.
The document(s) containing the information specified in Part I of this Form S-8 will be sent
or given to Plan participants as specified by Rule 428(b)(1) under the Securities Act. Such
documents are not being filed with the Securities and Exchange Commission, but constitute, along
with the documents incorporated by reference into this Registration Statement, a prospectus that
meets the requirements of Section 10(a) of the Securities Act.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
The Company will furnish without charge to each person to whom the prospectus is delivered,
upon the written or oral request of such person, a copy of any and all of the documents
incorporated by reference in Item 3 of Part II of this Form S-8, other than exhibits to such
documents (unless such exhibits are specifically incorporated by reference to the information that
is incorporated). Those documents are incorporated by reference in the Section 10(a) prospectus.
Requests must be made to Brigham Exploration Company, General Counsel, 6300 Bridge Point Parkway,
Building Two, Suite 500, Austin, Texas 78730, (512) 427-3300.
Note
: The re-offer prospectus referred to in the Explanatory Note follows this page.
Table of Contents
BRIGHAM EXPLORATION COMPANY
PROSPECTUS
This prospectus relates to the reoffer and resale from time to time by certain of our
stockholders identified herein under the heading "Selling
Stockholders" of up to 7,000 shares of
our common stock issued upon the exercise of outstanding options granted to such selling
stockholders pursuant to Plan. See "Selling Stockholders."
The selling stockholders identified in this prospectus may offer the shares from time to time
through public or private transactions at prevailing market prices, at prices related to prevailing
market prices or at privately negotiated prices. We will not receive any proceeds from the sale of
the shares covered by this prospectus.
Our common stock is quoted on the Nasdaq National Market under the trading symbol "BEXP." On
June 14, 2006, the last reported closing price of our common
stock was $6.98 per share on the
Nasdaq National Market.
The common stock offered pursuant to this prospectus involves a high degree of risk. For more
information, please see the section of this prospectus titled "Risk Factors," beginning on page 2.
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The
date of this prospectus is June 16, 2006
TABLE OF CONTENTS
About Us
1
Risk Factors
2
Selling Stockholders
15
Use of Proceeds
16
Plan of Distribution
17
Forward
Looking Statements
18
Where You Can Find More Information
18
Incorporation of Documents by Reference
18
Experts
18
Legal Matters
19
Opinion of Thompson & Knight LLP
Consent of PricewaterhouseCoopers LLP
Consent of Cawley Gillespie & Associates, Inc.
Unless the context otherwise requires or otherwise specifies, references in this prospectus to
"Brigham," "we," "our," and "us" refer to Brigham Exploration Company, unless otherwise indicated.
We have not authorized anyone to provide you with information different from that contained or
incorporated by reference in this prospectus. The selling stockholders are offering to sell, and
seeking offers to buy, shares of our common stock only in jurisdictions where offers and sales are
permitted. The information contained in, or incorporated by reference in, this prospectus is
accurate only as of the date of this prospectus, or the date of the document in which it appears,
regardless of the time of delivery of this prospectus or of any sale of common stock.
Table of Contents
ABOUT US
We are an independent exploration, development and production company that utilizes 3-D
seismic imaging and other advanced technologies to systematically explore for, develop and produce
domestic onshore oil and natural gas reserves. We focus our activities in provinces where we
believe 3-D seismic technology can be used effectively to maximize our return on invested capital
by reducing drilling risk. Our exploration and development activities are concentrated in three
provinces: the onshore Texas Gulf Coast, the Anadarko Basin and West Texas.
We are incorporated in the state of Delaware. Our executive offices are located at 6300
Bridge Point Parkway, Building Two, Suite 500, Austin, Texas 78730 and our telephone number is
(512) 427-3300. Information contained on our website, www.bexp3d.com, is not part of this
prospectus.
1
Table of Contents
RISK FACTORS
You should carefully consider the following risk factors, in addition to the other information
set forth in this prospectus. Each of these risk factors could adversely affect our business,
operating results and financial condition.
Risks Relating to the Exchange Notes
Holders of outstanding notes who fail to properly tender them may be unable to resell them.
If you do not tender your outstanding notes or if we do not accept your outstanding notes
because you did not tender your outstanding notes properly, then, after we consummate the exchange
offer, you may continue to hold outstanding notes that are subject to the existing transfer
restrictions. We will only issue exchange notes in exchange for outstanding notes that are timely
received by the exchange agent, together with all required documents, including a properly
completed and signed letter of transmittal. Therefore, you should allow sufficient time to ensure
timely delivery of the outstanding notes and you should carefully follow the instructions on how to
tender your outstanding notes. Neither we nor the exchange agent are required to tell you of any
defects or irregularities with respect to your tender of the outstanding notes. In addition, if you
tender your outstanding notes for the purpose of participation in a distribution of the exchange
notes, you will be required to comply with the registration and prospectus delivery requirements of
the Securities Act in connection with any resale of the exchange notes. If you are a broker-dealer
that receives exchange notes for your own account in exchange for outstanding notes that you
acquired as a result of market-making activities or any other trading activities, you will be
required to acknowledge that you will deliver a prospectus in connection with any resale of such
exchange notes. After the exchange offer is consummated, if you continue to hold any outstanding
notes, you may have difficulty selling them because there will be less outstanding notes
outstanding. In addition, if a large amount of outstanding notes are not tendered or are tendered
improperly, the limited amount of exchange notes that would be issued and outstanding after we
consummate the exchange offer could lower the market price of such exchange notes.
Our level of indebtedness may adversely affect our cash available for operations, which would limit
our growth, our ability to make interest and principal payments on our indebtedness as they become
due and our flexibility to respond to market changes.
At March 31, 2006, we had indebtedness of $44.3 million outstanding under our senior credit
agreement and $30 million outstanding under our subordinated credit agreement. After we used the
net proceeds from the Notes offering to repay the amounts outstanding under our senior and
subordinated credit agreements, we had $125 million in outstanding indebtedness, as well as $50
million of borrowing capacity available to us for borrowing under our $200 million senior credit
agreement. Our level of indebtedness has several important effects on our operations, including
those listed below.
•
It may make it more difficult for us to satisfy our obligations with respect to the
exchange notes.
•
We will dedicate a portion of our cash flow from operations to the payment of interest
on our indebtedness and to the payment of our other current obligations and will not have
these cash flows available for other purposes.
•
Our senior credit agreement and the indenture governing the exchange notes will limit
our ability to borrow additional funds or dispose of assets and may affect our flexibility
in planning for, and reacting to, changes in business conditions.
•
Our ability to obtain additional financing in the future for working capital, capital
expenditures, acquisitions, general corporate purposes or other purposes may be impaired.
•
We may be more vulnerable to economic downturns and our ability to withstand sustained
declines in oil and natural gas prices may be impaired.
•
Our flexibility in planning for or reacting to changes in market conditions may be limited.
•
It may place us at a competitive disadvantage compared to our competitors that have less debt.
We may incur additional debt in order to fund our exploration and development activities. A
higher level of indebtedness increases the risk that we may default on our debt obligations. Our
ability to meet our debt obligations and reduce our level of indebtedness depends on future
performance. General economic conditions, oil and natural gas prices and financial, business and
other factors will affect our operations and our future performance. Many of these factors are
beyond our control and we may not be able to generate sufficient cash flow to pay the interest on
2
Table of Contents
our debt, and future working capital, borrowings and equity financing may not be available to
pay or refinance such debt.
In addition, under the terms of our senior credit agreement, the borrowing base is subject to
at least semi-annual redeterminations based in part on prevailing oil and natural gas prices. In
the event the amount that we have borrowed under our senior credit agreement exceeds the
redetermined borrowing base, we could be forced to repay a portion of our borrowings. We may not
have sufficient funds to make such payments. If we do not have sufficient funds and are otherwise
unable to negotiate renewals of our borrowings or arrange new financing, we may have to sell assets
at unfavorable prices.
Despite current indebtedness levels, we and our subsidiaries may still be able to incur
substantially more debt, including secured debt. This could further exacerbate the risks associated
with our substantial leverage.
We and our subsidiaries may be able to incur substantial additional indebtedness in the
future. The terms of the indenture governing the exchange notes will not, and our senior credit
agreement does not, prohibit us or our subsidiaries from doing so. In addition to the liens granted
under our senior credit agreement, the indenture governing the exchange notes will allow us to
grant liens on all of our other assets to secure indebtedness outstanding under the senior secured
credit agreement and certain additional other debt without ratably securing the exchange notes. Our
senior credit agreement provides for total revolving credit borrowings up to $200 million (which
borrowings are limited by a borrowing base that is subject to re-determination at least
semi-annually and is currently set at $50 million) and all of those borrowings would be effectively
senior to the exchange notes and to the subsidiary guarantees thereof to the extent of the value of
the assets securing such indebtedness. If new indebtedness is added to our and our subsidiaries'
current debt levels, the related risks that we and they now face could intensify and we may not be
able to meet all our debt obligations, including the repayment of the exchange notes, in whole or
in part.
To service our indebtedness, we will require a significant amount of cash. Our ability to generate
cash depends on many factors beyond our control.
Our ability to make payments on and to refinance our indebtedness, including the exchange
notes, and to fund planned capital expenditures and development efforts will depend on our ability
to generate cash in the future. This, to a certain extent, is subject to general economic,
financial, competitive, legislative, regulatory and other factors that are beyond our control.
We cannot assure you that our business will generate sufficient cash flow from operations or
that future borrowings will be available to us under our senior credit agreement or otherwise in an
amount sufficient to enable us to pay our indebtedness, including the exchange notes, or to fund
our other liquidity needs. We may need to refinance all or a portion of our indebtedness, including
the exchange notes, on or before the maturity thereof. Any future borrowings under our senior
credit agreement will mature in June 2010. As a result, we may be required to refinance any
indebtedness then outstanding under our senior credit agreement prior to the maturity of the
exchange notes. We may not be able to obtain such financing on commercially reasonable terms or at
all. If we are unable to generate sufficiently material cash flow to refinance our debt
obligations, including the exchange notes, on favorable terms, it could have a significant adverse
effect on our financial condition and on our ability to pay principal and interest on the exchange
notes.
In addition, if for any reason we are unable to meet our debt service obligations, we would be
in default under the terms of our agreements governing our outstanding debt. If such a default were
to occur, the lenders under our senior credit agreement could elect to declare all amounts then
outstanding under the senior credit agreement immediately due and payable, and the lenders would
not be obligated to continue to advance funds under our senior credit agreement. In addition, if
such a default were to occur, the exchange notes would become immediately due and payable. If the
amounts outstanding under these debt agreements are accelerated, we cannot assure you that our
assets will be sufficient to repay in full the money owed to the banks or to our debt holders,
including holders of exchange notes.
3
Table of Contents
Your right to receive payments on the exchange notes is effectively subordinated to the rights
of our and the guarantors' existing and future secured creditors.
Holders of our secured indebtedness and the secured indebtedness of the guarantors will have
claims that are prior to your claims as holders of the exchange notes to the extent of the value of
the assets securing that other indebtedness. Notably, we and the guarantors are parties to our
senior credit agreement, which is secured by liens on substantially all of our assets and the
assets of the guarantors. The exchange notes will be effectively subordinated to any secured
indebtedness incurred under the senior credit agreement. In the event of any distribution or
payment of our or any guarantor's assets in any foreclosure, dissolution, winding-up, liquidation,
reorganization or other bankruptcy proceeding, holders of secured indebtedness will have prior
claim to those of our or the guarantor's assets that constitute their collateral. Holders of
exchange notes will participate ratably with all holders of our unsecured indebtedness that is
deemed to be of the same class as such exchange notes, and potentially with all of our or any
guarantor's other general creditors, based upon the respective amounts owed to each holder or
creditor, in our remaining assets. In any of the foregoing events, we cannot assure you that there
will be sufficient assets to pay amounts due on the exchange notes. As a result, holders of
exchange notes may receive less, ratably, than holders of secured indebtedness.
Up to $50 million of secured indebtedness will be available to be borrowed under the borrowing
base under our senior credit agreement. In addition, we will be permitted to borrow secured
indebtedness in the future under the terms of the indenture. See "Description of Exchange Notes —
Certain Covenants — Incurrence of Indebtedness and Issuance of Disqualified Stock" and — "Liens."
The exchange notes will be effectively subordinated to the debt of our non-guarantor subsidiaries,
if any.
The exchange notes will be fully and unconditionally guaranteed on a senior unsecured basis by
our existing operating subsidiaries, as well as all of our future domestic subsidiaries. However,
they will not be guaranteed by any of our future subsidiaries outside the United States unless,
subject to certain limited exceptions, these subsidiaries guarantee our other domestic
indebtedness. In addition, on the issue date of the exchange notes, two of our wholly owned
subsidiaries (referred to herein as the "limited partners"), which together own approximately 99%
limited partnership interests in Brigham Oil & Gas, L.P., our primary operating subsidiary, will
not be guarantors of the exchange notes. As of the date of this prospectus, the limited partners do
not conduct any business or operations and hold no properties other than the limited partnership
interests in Brigham Oil & Gas, L.P. and other minor miscellaneous assets. Under the indenture
governing the exchange notes, the limited partners will be required to guarantee the exchange notes
after the issue date if they ever (i) hold properties in excess of $1 million, (ii) incur debt in
excess of $1 million, or (iii) guarantee any of our or our subsidiaries' indebtedness. See
"Description of Exchange notes — Certain Covenants — Restrictions on Limited Partners." The
indenture also provides that the exchange notes may not be guaranteed by certain subsidiaries with
minimal net worth. The exchange notes will be effectively subordinated to all debt and other
liabilities, including trade payables of any subsidiaries that do not guarantee the exchange notes.
If we default on our obligations to pay our other indebtedness, we may not be able to make payments
on the exchange notes.
Any default under the agreements governing our indebtedness, including a default under our
senior credit agreement that is not waived by the required lenders, and the remedies sought by the
holders of any such indebtedness, could make us unable to pay principal, premium, if any, and
interest on the exchange notes and substantially decrease the market value of the exchange notes.
If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds
necessary to meet required payments of principal, premium, if any, and interest on our
indebtedness, or if we otherwise fail to comply with the various covenants, including financial and
operating covenants, in the instruments governing our indebtedness (including our senior credit
agreement), we could be in default under the terms of the agreements governing such indebtedness.
In the event of such default, the holders of such indebtedness could elect to declare all the funds
borrowed thereunder to be due and payable, together with accrued and unpaid interest, the lenders
under our senior credit agreement could elect to terminate their commitments, cease making further
loans and institute foreclosure proceedings against our assets, and we could be forced into
bankruptcy or liquidation. If our operating performance declines, we may in the future need to seek
to obtain waivers from the required lenders under our senior credit agreement to avoid being in
default. If we breach
4
Table of Contents
our covenants under our senior credit agreement and seek a waiver, we may not be able to
obtain a waiver from the required lenders. If this occurs, we would be in default under our senior
credit agreement, the lenders could exercise their rights as described above, and we could be
forced into bankruptcy or liquidation.
The indenture governing the exchange notes will impose, and our senior credit agreement imposes,
significant operating and financial restrictions, which may prevent us from capitalizing on
business opportunities and taking some actions.
The indenture governing the exchange notes will contain, and our senior credit agreements
contains, customary restrictions on our activities, including covenants that restrict our and our
subsidiaries' ability to:
•
incur additional debt;
•
pay dividends on, or redeem or repurchase stock;
•
create liens;
•
make specified types of investments;
•
apply net proceeds from certain asset sales;
•
engage in transactions with our affiliates;
•
engage in sale and leaseback transactions;
•
merge or consolidate;
•
restrict dividends or other payments from subsidiaries;
•
sell equity interests of subsidiaries; and
•
sell, assign, transfer, lease, convey or dispose of assets.
Our senior credit agreement also requires us to meet a minimum current ratio and a minimum
interest coverage ratio. We may not be able to maintain these ratios, and if we fail to be in
compliance with these tests, we will not be able to borrow funds under our senior credit agreement
which would make it difficult for us to operate our business.
The restrictions in the indenture governing the exchange notes and our senior credit agreement
may prevent us from taking actions that we believe would be in the best interest of our business,
and may make it difficult for us to successfully execute our business strategy or effectively
compete with companies that are not similarly restricted. We may also incur future debt obligations
that might subject us to additional restrictive covenants that could affect our financial and
operational flexibility. We cannot assure you that we will be granted waivers or amendments to
these agreements if for any reason we are unable to comply with these agreements, or that we will
be able to refinance our debt on terms acceptable to us, or at all.
The breach of any of these covenants and restrictions could result in a default under the
indenture governing the exchange notes or under our senior credit agreement. An event of default
under our debt agreements would permit some of our lenders to declare all amounts borrowed from
them to be due and payable. If we are unable to repay debt, lenders having secured obligations,
such as the lenders under our senior credit agreement, could proceed against the collateral
securing the debt. Because the indenture governing the exchange notes and our senior credit
agreement have customary cross-default provisions, if the indebtedness under the exchange notes or
under our senior credit agreements or any of our other facilities is accelerated, we may be unable
to repay or finance the amounts due.
We may not have the ability to raise the funds necessary to finance the change of control
offer required by the indenture governing the exchange notes.
Upon the occurrence of certain kinds of change of control events, we will be required to offer
to repurchase all outstanding exchange notes at 101% of the principal amount thereof plus accrued
and unpaid interest, if any, to the date of repurchase, unless all exchange notes have been
previously called for redemption. The holders of other debt securities that we may issue in the
future, which rank equally in right of payment with the exchange notes, may also have this right.
Our failure to purchase tendered exchange notes would constitute an event of default under the
indenture governing the exchange notes, which in turn, would constitute a default under our senior
credit agreement. In addition, the occurrence of a change of control would also constitute an event
of default under our senior credit agreement. A default under our senior credit agreement would
result in a default under the indenture if the lenders accelerate the debt under our senior credit
agreement.
5
Table of Contents
Therefore, it is possible that we may not have sufficient funds at the time of the change of
control to make the required repurchase of exchange notes. Moreover, our senior credit agreement
restricts, and any future indebtedness we incur may restrict, our ability to repurchase the
exchange notes, including following a change of control event. As a result, following a change of
control event, we would not be able to repurchase exchange notes unless we first repay all
indebtedness outstanding under our senior credit agreement and any of our other indebtedness that
contains similar provisions, or obtain a waiver from the holders of such indebtedness to permit us
to repurchase the exchange notes. We may be unable to repay all of that indebtedness or obtain a
waiver of that type. Any requirement to offer to repurchase outstanding exchange notes may
therefore require us to refinance our other outstanding debt, which we may not be able to do on
commercially reasonable terms, if at all. These repurchase requirements may also delay or make it
more difficult for others to obtain control of us.
In addition, certain important corporate events, such as leveraged recapitalizations that
would increase the level of our indebtedness, would not constitute a "Change of Control" under the
indenture.
Your ability to transfer the exchange notes may be limited by the absence of an active trading
market and there is no assurance that any active trading market will develop for the exchange
notes.
The exchange notes are a new issue of securities for which there is no established public
market. We do not intend to have the exchange notes listed on a national securities exchange or
included on any automated dealer quotation system, although we expect that they will eligible for
trading in The PORTAL Market. We cannot assure you that an active market for the exchange notes
will develop or, if developed, that it will continue. Even if a trading market for the exchange
notes does develop, you may not be able to sell your exchange notes at a particular time, if at
all, or you may not be able to obtain the price you desire for your exchange notes. Historically,
the market for non-investment grade debt has been subject to disruptions that have caused
substantial volatility in the prices of securities similar to the exchange notes. We cannot assure
you that the market, if any, for the exchange notes will be free from similar disruptions or that
any such disruptions may not adversely affect the prices at which you may sell your notes.
Federal and state statutes allow courts, under specific circumstances, to void the guarantees and
require noteholders to return payments received from the guarantors.
Creditors are protected by fraudulent conveyance laws which differ among various
jurisdictions, and these laws may apply to the issuance of the guarantees by our subsidiary
guarantors. Under federal bankruptcy law and comparable provisions of state fraudulent transfer
laws, a guarantee may be voided by a court, or subordinated to the claims of other creditors, if,
among other things:
•
the indebtedness evidenced by such guarantee was incurred by a subsidiary guarantor
with actual intent to hinder, delay or defraud any present or future creditor of such
subsidiary guarantor; or
•
such subsidiary guarantor did not receive fair consideration or reasonably equivalent
value for issuing the guarantee, and the applicable subsidiary guarantor
•
was insolvent, or was rendered insolvent by reason of issuing the applicable
guarantee;
•
was engaged or about to engage in a business or transaction for which the remaining
assets of the applicable subsidiary guarantor constituted unreasonably small capital; or
•
intended to incur, or believed that we or it would incur, indebtedness beyond our or
its ability to pay such debts as they matured.
In addition, any payment by such subsidiary guarantor pursuant to any guarantee could be
voided and required to be returned to such subsidiary guarantor, or to a fund for the benefit of
creditors of such subsidiary guarantor. A legal challenge to a guarantee on fraudulent conveyance
grounds may focus on the benefits, if any, realized by us or the subsidiary guarantors as a result
of our issuance of the guarantees. To the extent a subsidiary's guarantee of the exchange notes is
avoided as a result of fraudulent conveyance or held unenforceable for any other reason, you would
cease to have any claim in respect of that guarantee and would be creditors solely of ours.
Because all of our significant assets are held by our guarantor subsidiaries, the stake of a
guarantee being voided under fraudulent transfer laws is higher. In addition, any future guarantees
provided under the indenture governing
6
Table of Contents
the exchange notes have a greater risk of being voided. Moreover, the borrower under our
senior credit agreement is Brigham Oil & Gas, L.P., our primary operating subsidiary and guarantor
of the exchange notes. In the event Brigham Oil & Gas, L.P.'s guarantee of the exchange notes is
avoided or held unenforceable, the exchange notes would be effectively subordinated to any then
outstanding borrowings under our senior credit agreement, which would be paid in full prior to
amounts due on the exchange notes in the event of any foreclosure, dissolution, winding-up,
liquidation, reorganization or other bankruptcy proceeding with respect to Brigham Oil & Gas, L.P.
The measures of insolvency for purposes of these fraudulent transfer laws will vary depending
upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred.
Generally, however, a guarantor would be considered insolvent if:
•
the sum of its debts, including contingent liabilities, was greater than the fair
saleable value of all of its assets; or
•
if the present fair saleable value of its assets was less than the amount that would be
required to pay its probable liability on its existing debts, including contingent
liabilities, as they become absolute and mature; or
•
it could not pay its debts as they become due.
Risks Relating to Our Company and Our Industry
Oil and natural gas prices are volatile and a substantial reduction in these prices could adversely
affect our results and the price of our common stock.
Our revenues, operating results and future rate of growth depend highly upon the prices we
receive for our oil and natural gas production. Historically, the markets for oil and natural gas
have been volatile and are likely to continue to be volatile in the future. The NYMEX daily
settlement price for the prompt month natural gas contract in 2004 ranged from a high of $8.14 per
MMBtu to a low of $4.40 per MMBtu. In 2005, the same index ranged from a high of $15.38 per MMBtu
to a low of $5.79 per MMBtu. The NYMEX daily settlement price for the prompt month oil contract in
2004 ranged from a high of $56.17 per barrel to a low of $32.48 per barrel. In 2005, the same index
ranged from a high of $69.81 per barrel to a low of $42.12 per barrel. The markets and prices for
oil and natural gas depend on factors beyond our control. These factors include demand for oil and
natural gas, which fluctuate with changes in market and economic conditions and other factors,
including:
•
worldwide and domestic supplies of oil and natural gas;
•
actions taken by foreign oil and natural gas producing nations;
•
political conditions and events (including instability or armed conflict) in
oil-producing or natural gas- producing regions;
•
the level of global oil and natural gas inventories;
•
the price and level of foreign imports;
•
the level of consumer demand;
•
the price and availability of alternative fuels;
•
the availability of pipeline capacity;
•
weather conditions;
•
domestic and foreign governmental regulations and taxes; and
•
the overall economic environment.
Significant declines in oil and natural gas prices for an extended period may have the
following effects on our business:
•
limit our financial condition, liquidity, ability to finance planned capital
expenditures and results of operations;
•
reduce the amount of oil and natural gas that we can produce economically;
•
cause us to delay or postpone some of our capital projects;
•
reduce our revenues, operating income and cash flow;
•
reduce the carrying value of our oil and natural gas properties; and
•
limit our access to sources of capital, such as equity and long-term debt.
7
Table of Contents
We may have difficulty financing our planned capital expenditures, which could adversely affect our
business.
We make and will continue to make substantial capital expenditures in our exploration and
development projects. Without additional capital resources, our drilling and other activities may
be limited and our business, financial condition and results of operations may suffer. We may not
be able to secure additional financing on reasonable terms or at all and financing may not continue
to be available to us under our existing or new financing arrangements. If additional capital
resources are not available, we may be forced to curtail our exploration and development activities
and other activities or be forced to sell some of our assets on an untimely or unfavorable basis.
Any such curtailment or sale could have a material adverse effect on our business, financial
condition and results of operation. In addition, we have a limited number of shares of authorized
but unissued common stock available at this time. While we are in the process of seeking approval
from our stockholders to increase our number of shares of authorized common stock, unless and until
such change is approved, we would not have a sufficient number of shares of authorized common stock
to raise a substantial amount of proceeds to us in any subsequent public or private equity
offering.
Our exploration, development and drilling efforts and the operation of our wells may not be
profitable or achieve our targeted returns.
We require significant amounts of undeveloped leasehold acreage in order to further our
exploration and development efforts. Exploration and development activities are subject to many
risks, including the risk that commercially productive reservoirs will not be discovered. We invest
in property, including undeveloped leasehold acreage, which we believe will result in projects that
will add value over time. However, we cannot guarantee that all of our prospects will result in
viable projects or that we will not abandon our initial investments. Additionally, we cannot
guarantee that the leasehold acreage we acquire will be profitably developed, that new wells we
drill will be productive or that we will recover all or any portion of our investment in such
leasehold acreage or wells. Drilling for oil and natural gas may involve unprofitable efforts, not
only from dry wells but also from wells that are completed but do not produce sufficient net
reserves to return a profit after deducting operating and other costs. In addition, wells that are
profitable may not achieve our targeted rate of return. Our ability to achieve our target results
is dependent upon the current and future market prices for oil and natural gas and our ability to
economically add and produce reserves. We rely to a significant extent on 3-D seismic data and
other advanced technologies to identify leasehold acreage prospects and conduct our exploration
activities. The 3-D seismic data and other technologies we use do not allow us to know conclusively
prior to the acquisition of leasehold acreage or the drilling of a well whether oil or natural gas
is present or may be produced economically. The use of 3-D seismic data and other technologies also
requires greater pre-drilling expenditures than traditional drilling strategies.
In addition, we may not be successful in implementing our business strategy of controlling and
reducing the costs associated with drilling to find new reserves and with producing our existing
reserves in order to improve our overall return. The cost of drilling, completing and operating a
well is often uncertain and cost factors can adversely affect the economics of a project. We cannot
predict the cost of drilling, and we may be forced to limit, delay or cancel drilling operations as
a result of a variety of factors, including:
•
unexpected drilling conditions;
•
pressure or irregularities in formations;
•
equipment failures or accidents;
•
adverse weather conditions;
•
compliance with governmental requirements; and
•
shortages or delays in the availability of drilling rigs and the delivery of equipment.
Exploratory drilling is a speculative activity that may not result in commercially productive
reserves and may require expenditures in excess of budgeted amounts.
Our future rate of growth greatly depends on the success of our exploratory drilling program.
Exploratory drilling involves a higher degree of risk that we will not encounter commercially
productive oil or natural gas reservoirs than development drilling. We may not be successful in our
future drilling activities because even with the use of 3-D seismic and other advanced
technologies, exploratory drilling is a speculative activity.
8
Table of Contents
Although our oil and natural gas reserve data is independently estimated, these estimates may still
prove to be inaccurate.
Our proved reserve estimates are generated each year by Cawley, Gillespie & Associates, Inc.,
an independent petroleum consulting firm. In conducting its evaluation, the engineers and
geologists of Cawley, Gillespie & Associates, Inc. evaluate our properties and independently
develop estimates of our proved reserves. There are numerous uncertainties and risks that are
inherent in estimating quantities of oil and natural gas reserves and projecting future rates of
production and timing of development expenditures as many factors are beyond our control. Many
factors and assumptions are incorporated into the estimates of our proved reserves including:
•
expected reservoir characteristics based on geological, geophysical and engineering
assessments;
•
future production rates based on historical performance and expected future operating
and investment activities;
•
future oil and natural gas prices and quality and location differentials; and
•
future development and operating costs.
Although we believe the Cawley, Gillespie & Associates, Inc. reserve estimates are reasonable
based on the information available to them at the time they prepare their estimates, our actual
results could vary materially from these estimated quantities of proved oil and natural gas
reserves (in the aggregate and for a particular location), production, revenues, taxes and
development and operating expenditures. In addition, these estimates of proved reserves may be
subject to downward or upward revision based upon production history, results of future exploration
and development activities, prevailing oil and natural gas prices, operating and development costs
and other factors.
Finally, recovery of proved undeveloped reserves generally requires significant capital
expenditures and successful drilling operations. At December 31, 2005, approximately 49% of our
estimated proved reserves were classified as undeveloped. At December 31, 2005, we estimated that
it would require additional capital expenditures of approximately $122 million to develop our
proved undeveloped reserves. The estimates for our proved reserves assume that we can and will make
these expenditures and conduct these operations successfully, which may not occur.
We need to replace our reserves at a faster rate than companies whose reserves have longer
production periods. Our failure to replace our reserves would result in decreasing reserves and
production over time.
In general, production from oil and natural gas properties declines as reserves are depleted,
with the rate of decline depending on the characteristics of the reservoir. Except to the extent we
conduct successful exploration and development activities or acquire properties containing proved
reserves, or both, our proved reserves and production will decline as reserves are produced.
We may not be able to find, develop or acquire additional reserves to replace our current and
future production. Accordingly, our future oil and natural gas reserves and production and
therefore our future cash flow and income, are dependent upon our success in economically finding
or acquiring new reserves and efficiently developing our existing reserves.
Our reserves in the Gulf Coast have high initial production rates followed by steep declines
in production, resulting in a reserve life for wells in this area that is shorter than the industry
average. This production volatility has impacted and, in the future, may continue to impact our
quarterly and annual production levels.
We generally must locate and develop or acquire new oil and natural gas reserves to replace
those being depleted by production. Without successful drilling and exploration or acquisition
activities, our reserves and revenues will decline rapidly. We may not be successful in extending
the reserve life of our properties generally and our Gulf Coast properties in particular. Our
current strategy includes increasing our reserve base through drilling activities on our existing
Gulf Coast properties and properties located in our other core areas, which have historically had
longer-lived reserves. Our existing and future exploration and development projects may not result
in significant additional reserves and we may not be able to drill productive wells at economically
viable costs.
9
Table of Contents
Our future cash flows are subject to a number of variables, such as the level of production
from existing wells, prices of oil and natural gas and our success in finding and producing new
reserves. If our revenues were to decrease as a result of lower oil and natural gas prices,
decreased production or otherwise, and our access to capital were limited, we would have a reduced
ability to replace our reserves or to maintain production at current levels, potentially resulting
in a decrease in production and revenue over time.
Drilling locations that we decide to drill may not yield oil or natural gas in commercially viable
quantities or quantities sufficient to meet our targeted rate of return.
Our drilling locations are in various stages of evaluation, ranging from locations that are
ready to be drilled to locations that will require substantial additional evaluation and
interpretation. There is no way to predict in advance of drilling and testing whether any
particular drilling location will yield oil or natural gas in sufficient quantities to recover our
drilling or completion costs or to be economically viable. Our use of seismic data and other
technologies and the study of producing fields in the same area will not enable us to know
conclusively prior to drilling whether oil and natural gas will be present or, if present, whether
oil and natural gas will be present in commercial quantities. The analysis that we perform using
data from other wells, more fully explored prospects and/or producing fields may not be useful in
predicting the characteristics and potential reserves associated with our drilling locations. As a
result, we may not find commercially viable quantities of oil and natural gas and, therefore, we
may not achieve a targeted rate of return or have a positive return on investment.
The unavailability or high cost of drilling rigs, equipment, supplies, insurance, personnel and oil
field services could adversely affect our ability to execute our exploration and development plans
on a timely basis and within our budget.
Our industry is cyclical and, from time to time, there is a shortage of drilling rigs,
equipment, supplies, insurance or qualified personnel. During these periods, the costs and delivery
times of rigs, equipment and supplies are substantially greater. In addition, the demand for, and
wage rates of, qualified drilling rig crews rise as the number of active rigs in service increases.
As a result of increasing levels of exploration and development activities in response to strong
prices of oil and natural gas, the demand for oilfield services has risen, and the costs of these
services are increasing, while the quality of these services may suffer. If the unavailability or
high cost of drilling rigs, equipment, supplies, insurance or qualified personnel were particularly
severe in Texas and Oklahoma, we could be materially and adversely affected because our operations
and properties are concentrated in those areas.
The marketability of our oil and natural gas production depends on services and facilities that we
typically do not own or control. The failure or inaccessibility of any such services or facilities
could result in a curtailment of our production and revenues.
The marketability of our production depends in part upon the availability, proximity and
capacity of natural gas gathering systems, pipelines and processing facilities. We generally
deliver natural gas through gathering systems and pipelines that we do not own under interruptible
or short term transportation agreements. Under the interruptible transportation agreements, the
transportation of our natural gas may be interrupted due to capacity constraints on the applicable
system, for maintenance or repair of the system, or for other reasons as dictated by the particular
agreements. If any of the pipelines or other facilities that we use become unavailable, we would be
required to find a suitable alternative to transport and process the natural gas that we produce,
which could increase our costs and reduce the revenues we might obtain from the sale of our natural
gas. For example, Hurricane Rita disrupted the operations of natural gas pipelines and
fractionators and required the evacuation of personnel required to oversee some of our facilities
in the Gulf Coast area. As a result of these disruptions, we were forced temporarily to curtail
some of our production in our onshore Gulf Coast province for approximately six days.
Lower oil and natural gas prices may cause us to record ceiling limitation write-downs, which would
reduce our stockholders' equity.
We use the full cost method of accounting to account for our oil and natural gas investments.
Accordingly, we capitalize the cost to acquire, explore for and develop oil and natural gas
properties. Under full cost accounting rules, the net capitalized cost of oil and natural gas
properties may not exceed a "ceiling limit" that is based upon the present value of estimated
future net revenues from proved reserves, discounted at 10%, plus the lower of the cost or
10
Table of Contents
the fair market value of our unproved properties. If the net capitalized costs of our oil and
natural gas properties exceed the ceiling limit, we must charge the amount of the excess to
earnings. This is called a "ceiling limitation write-down." The risk that we will be required to
write down the carrying value of our oil and natural gas properties increases when oil and natural
gas prices are low or volatile. In addition, write-downs may occur if we experience substantial
downward adjustments to our estimated proved reserves. Once incurred, a write-down of our oil and
natural gas properties is not reversible at a later date. Write-downs required by full cost method
of accounting do not impact our cash flow from operating activities, but do reduce our net income
and stockholders' equity.
We are subject to various operating and other casualty risks that could result in liability
exposure or the loss of production and revenues.
Our operations are subject to hazards and risks inherent in drilling for and producing and
transporting oil and natural gas, such as:
•
fires;
•
natural disasters;
•
formations with abnormal pressures;
•
blowouts, cratering and explosions; and
•
pipeline ruptures and spills.
Any of these hazards and risks can result in the loss of hydrocarbons, environmental
pollution, personal injury claims and other damage to our properties and the property of others.
We may not have enough insurance to cover all of the risks we face, which could result in
significant financial exposure.
We maintain insurance coverage against some, but not all, potential losses in order to protect
against the risks we face. We may elect not to carry insurance if our management believes that the
cost of insurance is excessive relative to the risks presented. If an event occurs that is not
covered, or not fully covered, by insurance, it could harm our financial condition, results of
operations and cash flows. In addition, we cannot fully insure against pollution and environmental
risks.
We cannot control activities on properties we do not operate. Failure to fund capital expenditure
requirements may result in reduction or forfeiture of our interests in some of our non-operated
projects.
We do not operate some of the properties in which we own an interest and we have limited
ability to exercise influence over the operations or the costs associated with operating these
properties. As of December 31, 2005, approximately 31% of our oil and natural gas properties, based
on pre-tax PV10% value, were operated by other companies. Our dependence on the operator and other
working interest owners for these projects and our limited ability to influence operations and
associated costs could materially adversely affect the realization of our targeted return on
capital in drilling or acquisition activities and our targeted production growth rate. The success
and timing of drilling, development and exploitation activities on properties operated by others
depend on a number of factors that are beyond our control, including the operator's expertise and
financial resources, approval of other participants for drilling wells and utilization of
technology.
When we are not the majority owner or operator of a particular oil or natural gas project, we
may have no control over the timing or amount of capital expenditures associated with such project.
If we are not willing or able to fund our capital expenditures relating to such projects when
required by the majority owner or operator, our interests in these projects may be reduced or
forfeited.
Our future operating results may fluctuate and significant declines in them would limit our ability
to invest in projects.
Our future operating results may fluctuate significantly depending upon a number of factors,
including:
•
industry conditions;
11
Table of Contents
•
prices of oil and natural gas;
•
rates of drilling success;
•
capital availability;
•
rates of production from completed wells; and
•
the timing and amount of capital expenditures.
This variability could cause our business, financial condition and results of operations to
suffer. In addition, any failure or delay in the realization of expected cash flows from operating
activities could limit our ability to invest and participate in other economically attractive
projects.
Our hedging activities may prevent us from benefiting from price increases and may expose us
to other risks.
In an attempt to reduce our sensitivity to oil and natural gas price volatility, we enter into
hedging arrangements with respect to a portion of expected production, such as the use of
derivative contracts that generally result in a fixed price or a range of minimum and maximum price
limits over a specified time period. See "Management's Discussion and Analysis of Financial
Condition and Results of Operation — Derivative Instruments and Hedging Activities."
Our hedging activities expose us to the risk of financial loss in certain circumstances. For
example, if we do not produce our oil and natural gas reserves at rates equivalent to our
derivative position, we would be required to satisfy our obligations under those derivative
contracts on potentially unfavorable terms without the ability to offset that risk through sales of
comparable quantities of our own production. This situation occurred during portions of 2000, due
in part to our sale of certain producing reserves in mid-1999 and reduced our cash flow in 2000 by
approximately $1 million. Additionally, because the terms of our derivative contracts are based on
assumptions and estimates of numerous factors such as cost of production and pipeline and other
transportation and marketing costs to delivery points, substantial differences between the prices
we receive pursuant to our derivative contracts and our actual results could harm our profit
margins and our ability to manage the risk associated with fluctuations in oil and natural gas
prices. We also could be financially harmed if the counter parties to our derivative contracts
prove unable or unwilling to perform their obligations under such contracts. Additionally, in the
past, some of our derivative contracts required us to deliver cash collateral or other assurances
of performance to the counter parties if our payment obligations exceeded certain levels. Future
collateral requirements are uncertain but will depend on arrangements with our counter parties and
highly volatile oil and natural gas prices.
We face significant competition and many of our competitors have resources in excess of our
available resources.
We operate in the highly competitive areas of oil and natural gas exploration, exploitation,
acquisition and production. We face intense competition from a large number of independent,
technology-driven companies as well as both major-integrated and other independent oil and natural
gas companies in a number of areas such as:
•
seeking to acquire desirable producing properties or new leases for future exploration;
•
marketing our oil and natural gas production; and
•
seeking to acquire the equipment and expertise necessary to operate and develop those properties.
Many of our competitors have financial and other resources substantially in excess of those
available to us. This highly competitive environment could harm our business.
We are subject to various governmental regulations and environmental risks that may cause us to
incur substantial costs.
From time to time, in varying degrees, political developments and federal and state laws and
regulations affect our operations. In particular, price controls, taxes and other laws relating to
the oil and natural gas industry, changes in these laws and changes in administrative regulations
have affected and in the future could affect oil and natural gas production, operations and
economics. We cannot predict how agencies or courts will interpret existing laws and regulations or
the effect of these adoptions and interpretations may have on our business or financial condition.
12
Table of Contents
Our business is subject to laws and regulations promulgated by federal, state and local
authorities, including the FERC, the EPA, the Texas Railroad Commission, the TCEQ and the Oklahoma
Corporation Commission, relating to the exploration for, and the development, production and
marketing of, oil and natural gas, as well as safety matters. Legal requirements are frequently
changed and subject to interpretation and we are unable to predict the ultimate cost of compliance
with these requirements or their effect on our operations. We may be required to make significant
expenditures to comply with governmental laws and regulations.
Our operations are subject to complex federal, state and local environmental laws and
regulations, including CERCLA, RCRA, OPA and the Clean Water Act. Environmental laws and
regulations change frequently, and the implementation of new, or the modification of existing, laws
or regulations could harm us. The discharge of oil, natural gas or other pollutants into the air,
soil or water may give rise to significant liabilities on our part to the government and third
parties and may require us to incur substantial costs of remediation.
We depend on our key management personnel and technical experts and the loss any of these
individuals could adversely affect our business.
If we lose the services of our key management personnel or technical experts or are unable to
attract additional qualified personnel, our business, financial condition, results of operations,
exploration and development efforts and ability to grow could suffer. We have assembled a team of
geologists, geophysicists and engineers who have considerable experience in applying 3-D seismic
imaging technology to explore for and to develop oil and natural gas. We depend upon the knowledge,
skill and experience of these experts to provide 3-D seismic imaging and to assist us in reducing
the risks associated with our participation in oil and natural gas exploration and development
projects. In addition, the success of our business depends, to a significant extent, upon the
abilities and continued efforts of our management, particularly Ben M. Brigham, our Chief Executive
Officer, President and Chairman of the Board. We have an employment agreement with Mr. Brigham, but
do not have an employment agreement with any of our other employees.
The market price of our common stock is volatile.
The trading price of our common stock and the price at which we may sell securities in the
future is subject to large fluctuations in response to any of the following:
•
limited trading volume in our stock;
•
changes in government regulations;
•
quarterly variations in operating results;
•
our involvement in litigation;
•
general market conditions;
•
the prices of oil and natural gas;
•
announcements by us and our competitors;
•
our liquidity;
•
our ability to raise additional funds; and
•
other events.
Our common stock price may decline when our financial results decline or when events occur
that are adverse to us, our industry, or the equity markets.
You can expect the market price of our common stock to decline when our financial results
decline or otherwise fail to meet the expectations of the financial community or the investing
public or at any other time when events actually or potentially adverse to us or the oil and
natural gas industry or the economy occur. Our common stock price may decline to a price below the
price you paid to purchase your shares of common stock in this offering.
We do not intend to pay any dividends on our common stock.
We anticipate that we will retain all future earnings and other cash resources for the future
operation and development of our business. Accordingly, we do not intend to declare or pay any cash
dividends on our common
13
Table of Contents
stock in the foreseeable future. Payment of any future dividends will be at the discretion of
our board of directors after taking into account many factors, including our operating results,
financial condition, current and anticipated cash needs and plans for expansion.
Our shares that are eligible for future sale may have an adverse effect on the price of our
common stock.
Sales of substantial amounts of common stock, or a perception that such sales could occur,
could adversely affect the market price of the common stock and could impair our ability to raise
capital through the sale of our equity securities. Certain of our stockholders own 16.6% of our
outstanding common stock. All of these shares have are being registered under the Securities Act
pursuant to a registration statement and all or a portion of their shares may be sold.
Certain of our affiliates control a substantial portion of our outstanding common stock, which may
affect your interests as a noteholder or stockholder.
Our directors, executive officers and 10% or greater stockholders, and certain of their
affiliates, beneficially own a substantial portion of our outstanding common stock. Accordingly,
these stockholders, as a group, may be able to control the outcome of stockholder votes, including
votes concerning the election of directors, the adoption or amendment of provisions in our
certificate of incorporation or bylaws, and the approval of mergers and other significant corporate
transactions. The existence of these levels of ownership concentrated in a few persons makes it
unlikely that any other holder of our common stock may be able to affect our management or
direction. These factors may also have the effect of delaying or preventing a change in our
management or voting control. Moreover, the interests of these stockholders could conflict with the
noteholders. For example, our stockholders may have an interest in pursuing acquisitions,
divestitures, financings or other transactions that, in their judgment, could enhance their equity
investments, even though such transactions might involve risks to noteholders.
Certain anti-takeover provisions may adversely affect your rights as a noteholder or stockholder.
Our certificate of incorporation authorizes our Board of Directors to issue up to 10 million
shares of preferred stock without stockholder approval and to set the rights, preferences and other
designations, including voting rights, of those shares as the Board of Directors may determine. In
addition, our Series A preferred stock and our senior credit agreement contain terms restricting
our ability to enter into change of control transactions, including requirements to redeem or repay
our outstanding Series A preferred stock and the amounts borrowed under our senior credit agreement
upon a change in control. These provisions, alone or in combination with the other matters
described in the preceding paragraph may discourage transactions involving actual or potential
changes in our control. We are also subject to provisions of the Delaware General Corporation Law
that may make some business combinations more difficult.
14
Table of Contents
SELLING STOCKHOLDERS
This prospectus relates to shares of Common Stock that have been acquired by the Selling
Stockholders named below pursuant to the Plan. Each of the Selling Stockholders is a director of
the Company. The following table sets forth:
•
The nature of any material relationship that such Selling Stockholder has had with us for the past three years;
•
the number of shares of Common Stock each Selling Stockholder beneficially owned as of May 31, 2006;
•
the number of shares of Common Stock acquired by each Selling Stockholder pursuant to the
Plan and being registered under this Registration Statement, some or all of which shares may
be sold pursuant to this prospectus; and
•
the number of shares of Common Stock and the percentage, if 1% or more, of the total class
of Common Stock outstanding to be beneficially owned by each Selling Stockholder following
this offering, assuming the sale pursuant to this offering of all shares acquired by such
Selling Stockholder pursuant to the Plan and registered under this Registration Statement.
There is no assurance that any of the Selling Stockholders will sell any or all of the shares
offered by them under this Registration Statement. The address of each Selling Stockholder is c/o
Brigham Exploration Company, 6300 Bridge Point Parkway, Building 2, Suite 500, Austin, Texas 78730.
Number of Shares
Number of Shares
Percentage of Shares
Selling Stockholder
Beneficially Owned
Being Registered
Beneficially Owned
Before
After
Offering
Offering
Harold Carter(1)
315,693
500
*
*
Stephen Reynolds(1)
69,027
500
*
*
Hobart Smith(1)
6,000
6,000
*
*
*
Represents less than 1%.
(1)
Mr. Carter, Mr. Reynolds and Mr. Smith are all directors of the Company.
15
Table of Contents
USE OF PROCEEDS
We will not receive any proceeds from sales by the selling stockholders.
16
Table of Contents
PLAN OF DISTRIBUTION
Shares covered by this prospectus may be offered and sold from time to time by the Selling
Stockholders. We will not receive any proceeds from sales of any shares by Selling Stockholders.
The term "Selling Stockholders" includes the selling stockholders listed in the table above and any
donees, pledgees, transferees or other successors-in-interest selling shares received after the
date of this prospectus from a Selling Stockholder. The Selling Stockholders or their pledgees,
donees, transferees or other successors in interest may sell shares pursuant to this prospectus
from time to time:
•
in transactions (including one or more block transactions) on the NASDAQ National Market;
•
in the public market off the NASDAQ;
•
in privately negotiated transactions;
•
through put or call options transactions relating to the shares; or
•
in a combination of such transactions.
Each sale may be made either at the market price prevailing at the time of sale or at a
negotiated price. Sales may be made through brokers or to dealers, and such brokers or dealers may
receive compensation in the form of commissions or discounts not exceeding those customary in
similar transactions. Any shares covered by this prospectus that qualify for sale pursuant to Rule
144 under the Securities Act may be sold under Rule 144 rather than pursuant to this prospectus.
All expenses of registration incurred in connection with this offering are being borne by the
Company, but all brokerage commissions and other expenses incurred by a Selling Stockholder will be
borne by that Selling Stockholder.
The Selling Stockholders and any dealer acting in connection with the offering or any broker
executing a sell order on behalf of a Selling Stockholder may be deemed to be "underwriters" within
the meaning of the Securities Act, in which event any profit on the sale of shares by a Selling
Stockholder and any commissions or discounts received by any such broker or dealer may be deemed to
be underwriting compensation under the Securities Act. In addition, any such broker or dealer may
be required to deliver a copy of this prospectus to any person who purchases any of the shares from
or through such broker or dealer.
In order to comply with the securities laws of certain states, if applicable, the shares will
be sold only through registered or licensed brokers or dealers.
17
Table of Contents
FORWARD-LOOKING
STATEMENTS
This prospectus and the documents incorporated by reference in this prospectus contain
forward-looking statements within the meaning of the federal securities laws.
These forward-looking statements include, among others, the following:
•
our growth strategies;
•
our ability to successfully and economically explore for and develop oil and gas resources;
•
anticipated trends in our business;
•
our future results of operations;
•
our liquidity and ability to finance our exploration and development activities;
•
market conditions in the oil and gas industry;
•
our ability to make and integrate acquisitions; and
•
the impact of governmental regulation.
These
statements may be found under "Risk Factors" and other
places. Forward-looking
statements are typically identified by use of terms such as "may," "will," "expect," "anticipate," "estimate"
and similar words, although some forward-looking statements may be expressed differently. You should be aware that
our actual results could differ materially from those contained in the forward-looking statements. You should
consider carefully the statements under "Risk Factors" and other sections of this prospectus, which describe factors that
could cause our actual results to differ from those set forth in the forward-looking statements.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports and other information with the Securities and
Exchange Commission. You can read and copy any materials we file with the Securities and Exchange
Commission at its Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. You can
obtain information about the operation of the Securities and Exchange Commission's Public Reference
Room by calling the Securities and Exchange Commission at 1-800-SEC-0330. The Securities and
Exchange Commission also maintains a web site that contains information we file electronically with
the Securities and Exchange Commission, which you can access over the Internet at
http://www.sec.gov. In addition, you can obtain information about us at the offices of the New York
Stock Exchange, 20 Broad Street, New York, New York 10005. We have agreed that, if we are not
subject to the informational requirements of Sections 13 or 15(d) of the Securities Exchange Act of
1934 at any time while the notes constitute "restricted securities" within the meaning of the
Securities Act, we will furnish to holders and beneficial owners of the notes and to prospective
purchasers designated by such holders the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act to permit compliance with Rule 144A in connection with resales
of the notes. You may request a copy of our filings at no cost, by writing or telephoning us at the
following address: Brigham Exploration Company, 6300 Bridge Point Parkway, Building Two, Suite 500,
Austin, Texas 78730.
INCORPORATION OF DOCUMENTS BY REFERENCE
This prospectus incorporates documents and important information, by reference that is not
part of this prospectus or delivered with this prospectus. This means that we are disclosing
important information to you by referring you to those documents. You should be aware that
information in a document incorporated by reference may have been modified or superseded by
information that is included in other documents that were filed at a later date and which are also
incorporated by reference or included in this prospectus.
We incorporate by reference:
•
Our Annual Report on Form 10-K for the year ended December 31, 2005, previously filed
with the Securities and Exchange Commission.
•
Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2006, previously
filed with the Securities and Exchange Commission.
•
Our Current Reports on Form 8-K filed on February 16, 2006, February 22, 2006,
February 23, 2006, March 21, 2006, April 4, 2006, April 5, 2006, April 14, 2006, April
24, 2006, May 3, 2006, May 19, 2006 and June 1, 2006.
All documents and reports that we file with the Securities and Exchange Commission after the
date of this prospectus and before the termination of the exchange offer shall be deemed
incorporated herein by reference and shall be deemed to be a part hereof from the date of filing of
such documents and reports. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded for purposes of this
prospectus to the extent that a statement contained herein or in any subsequently filed document or
report that also is or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this prospectus.
EXPERTS
The consolidated financial statements and management's assessment of the effectiveness of
internal control over financial reporting (which is included in Management's Report on Internal
Control over Financial Reporting) incorporated in this prospectus by reference to the Annual Report
on the Form 10-K for the year ended December 31, 2005 have been so incorporated in reliance on the
report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on
the authority of said firm as experts in auditing and accounting.
Cawley, Gillespie & Associates, Inc., independent petroleum consultants, estimated our
reserves as of December 31, 2005, 2004 and 2003 and the present value of the estimated future net
revenues from those estimated reserves included in this document.
18
Table of Contents
These estimates are included in reliance upon their reports given upon their authority as experts
on the matters covered by the summary reserve report.
LEGAL MATTERS
Certain legal matters in connection with the securities offered pursuant to this prospectus
have been passed upon by Thompson & Knight L.L.P., Dallas, Texas.
19
Table of Contents
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by the Company with the SEC pursuant to Section 13 of the Exchange
Act, are incorporated herein by reference:
•
Our Annual Report on Form 10-K for the fiscal year ended December 31, 2005, filed on March 1, 2006;
•
Our Quarterly Report on Form 10-Q for the period ended March 31, 2006, filed on May 8, 2006;
•
Our Current Reports on Form 8-K filed on February 16, 2006, February 22, 2006, February 23, 2006, March 21, 2006, April 4, 2006, April 5, 2006, April 14,
2006, April 24, 2006, May 3, 2006, May 19, 2006 and June 1, 2006; and
•
The description of our common stock contained in our registration statement on Form 8-A
filed under Section 12 of the Securities Exchange Act of 1934 on April 25, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of this Registration Statement and prior to the filing of a
post-effective amendment indicating that all securities offered hereby have been sold or
deregistering all securities then remaining unsold, shall be deemed to be incorporated by reference
into this Registration Statement and to be a part hereof from the date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Directors and Officers.
In accordance with Section 102(b)(7) of the General Corporation Law of the State of Delaware,
our Certificate of Incorporation includes a provision that, to the fullest extent permitted by law,
eliminates the personal liability of members of our Board of Directors to us or our stockholders
for monetary damages for breach of fiduciary duty as a director. Such provision does not eliminate
or limit the liability of a director (1) for any breach of a director's duty of loyalty to us or
our stockholders, (2) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of a law, (3) for paying an unlawful dividend or approving an
illegal stock repurchase (as provided in Section 174 of the Delaware General Corporation Law) or
(4) for any transaction from which the director derived an improper personal benefit.
Under Section 145 of the Delaware General Corporation Law, we have the power to indemnify any
person who was or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding (other than an action by or in the right of the corporation)
by reason of the fact that the person is or was a director, officer, employee or agent of any
corporation, partnership, joint venture, trust or other enterprise, reasonably incurred in
connection with such action, suit or proceeding. The power to indemnify applies only if the person
acted in good faith and in a manner the person reasonably believed to be in or not opposed to the
best interests of the corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe the person's conduct was unlawful.
In the case of an action by or in the right of the corporation, no indemnification may be made
with respect to any claim, issue or matter as to which such person shall have been adjudged to be
liable to us unless and only to the extent that the court of chancery or the court in which such
action or suit was brought shall determine that despite the adjudication of liability such person
is fairly and reasonably entitled to indemnify for such expenses which the court shall deem proper.
Section 145 of the Delaware General Corporation Law further provides that to the extent one of
our directors or officers has been successful in the defense of any action, suit or proceeding
referred to above or in the defense of any claim,
II-1
Table of Contents
issue or matter therein, that person shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred in connection therewith.
We also have the power to purchase and maintain insurance on behalf of any person covering any
liability incurred in that person's capacity as a director, officer, employee or agent of the
corporation, or arising out of that person's status as such, whether or not we would have the power
to indemnify against the liability.
The Certificate of Incorporation and Bylaws provide that we will indemnify our officers and
directors and former officers and directors against any expenses, judgments or settlement payments
sustained or paid by such persons as a result of having acted as one of our officers or directors,
or, at our request, as an officer, director, agent or employee of another business entity. The
Certificate of Incorporation and Bylaws further provide that we may, by action of our Board of Directors, provide
indemnification to our employees and agents, individually or as a group, with the same scope and
effect as the indemnification of directors and officers.
Each Indemnity Agreement between us and our executive officers provides for the
indemnification in certain instances against liability and expenses incurred in connection with
proceedings brought by or in the right of the corporation or by third parties by reason of a person
serving as one of our officers or directors.
Item 7. Exemption from Registration Claimed.
The issuances were made in reliance on the exemption from the registration requirements of the
Securities Act of 1933, as amended, contained in Section 4(2) thereof, covering transactions not
involving any public offering or not involving any "offer" or "sale."
Item 8. Exhibits.
Number
Description
4.1
Brigham Exploration Company 1997 Director Stock Option Plan (filed as Exhibit 10.15 to the
Company's Annual Report on Form 10-K for the year ended December 31, 2003 and incorporated
herein by reference).
5.1*
Opinion of Thompson & Knight LLP
23.1*
Consent of PricewaterhouseCoopers LLP
23.2*
Consent of Cawley Gillespie & Associates, Inc.
23.3*
Consent of Thompson & Knight LLP (contained in Exhibit 5.1).
24.1*
Powers of Attorney (included on the signature page hereto).
*
Filed herewith.
Item 9. Undertakings.
The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being made, a post-effective
amendment to this Registration Statement to include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or any material change
to such information in this Registration Statement; provided, however, that the undertakings set
forth in paragraphs (a)(i) and (a)(ii) do not apply if the information required to be included in a
post-effective amendment by those
II-2
Table of Contents
paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in this
Registration Statement.
(b) That, for the purpose of determining any liability under the Securities Act, each such
post-effective amendment will be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time will be deemed to be
the initial bona fide offering thereof.
(c) To remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
(d) That, for purposes of determining any liability under the Securities Act, each filing of
the registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange Act that is
incorporated by reference in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(e) Insofar as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the registrant pursuant to the
provisions referred to in Item 6 of this Registration Statement, or otherwise, the registrant has
been advised that in the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Securities Act and will be governed by the final adjudication of such issue.
II-3
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it
has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and
has duly caused this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Austin and State of Texas on the 1
st
day of
June, 2006.
BRIGHAM EXPLORATION COMPANY
By:
/s/ Ben M. Brigham
Ben M. Brigham
Chairman of the Board, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been
signed by the following in the capacities and on the dates indicated. Each person whose signature
appears below constitutes and appoints Ben "Bud" M. Brigham and Eugene B. Shepherd, Jr., and each
of them (with full power to each of them to act alone), his true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities to sign on his behalf individually and in each capacity stated
below any amendment, including post-effective amendments, to this Registration Statement, and to
file the same, with all exhibits thereto and other documents in connection therewith with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of
them, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents and
either of them, or their substitutes, may lawfully do or cause to be done by virtue hereof.
Signature
Title
Date
/s/ Ben M. Brigham
Chief Executive Officer, President,
June 1, 2006
Ben M. Brigham
Chairman of the Board and Director
(Principal Executive Officer)
/s/ Eugene B. Shepherd, Jr.
Chief Financial Officer
June 1, 2006
Eugene B. Shepherd, Jr.
(Principal Financial and Accounting Officer)
/s/ David T. Brigham
Director
June 1, 2006
David T. Brigham
/s/ Harold D. Carter
Director
June 1, 2006
Harold D. Carter
/s/ Stephen C. Hurley
Director
June 1, 2006
Stephen C. Hurley
/s/ Stephen P. Reynolds
Director
June 1, 2006
Stephen P. Reynolds
/s/ Hobart A. Smith
Director
June 1, 2006
Hobart A. Smith
/s/ Steven A. Webster
Director
June 1, 2006
Steven A. Webster
/s/ R. Graham Whaling
Director
June 1, 2006
R. Graham Whaling
II-4
Table of Contents
Index
to Exhibits
Number
Description
4.1
Brigham Exploration Company 1997 Director Stock Option Plan (filed as Exhibit 10.15 to the
Company's Annual Report on Form 10-K for the year ended December 31, 2003 and incorporated
herein by reference).
5.1*
Opinion of Thompson & Knight LLP
23.1*
Consent of PricewaterhouseCoopers LLP
23.2*
Consent of Cawley Gillespie & Associates, Inc.
23.3*
Consent of Thompson & Knight LLP (contained in Exhibit 5.1).
24.1*
Powers of Attorney (included on the signature page hereto).
*
Filed herewith.