tec_ex1019-80331.htm


    
      
        Exhibit
10.19


         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

      

    

     

    CONFIDENTIAL

     

     

     February
15, 2008

     

     

    Board of
Directors

    Torrent
Energy Corporation

    1 S.W.
Columbia Street, Suite 640

    Portland,
Oregon 97258

    503-224-0072

     

    Attention: 
Mr. John Carlson, President and Chief Executive Officer

     

    Dear Mr.
Carlson:

     

    This
letter (the “Agreement”) confirms the terms of the engagement of Gordian Group,
LLC (“Gordian”) by Torrent Energy Corporation (together with its subsidiaries,
the “Company”) as the Company’s exclusive investment banker as of the date
hereof to provide certain financial advisory services as specifically set forth
below in connection with any merger, consolidation, joint venture or other
business combination, sale of substantially all or a portion of the assets or
outstanding securities of the Company, the acquisition of substantially all or a
portion of the assets or outstanding securities of another entity, an investment
(debt or equity) in the Company, a reorganization or recapitalization of the
Company, a restructuring or compromise of the Company’s indebtedness (contingent
or otherwise) or a material portion of the Company’s obligations and/or
preferred stock, or raising new or replacement capital for the Company, in any
case in one or a series of transactions (each, a “Financial Transaction”),
excluding those transactions listed in Exhibit A (“Excluded
Transactions”).

     

    Gordian
will assist the Company with the formulation, evaluation and implementation of
various options for effecting a Financial Transaction for the Company under a
variety of mechanisms and in connection with the other matters listed
below.  In connection with our role as financial advisor, we will
provide the following services to the extent appropriate and as requested from
time to time:

     

    
      	
              a)  

            	
              assist
      with the development, negotiation and implementation of a Financial
      Transaction or Financial Transactions, including rendering advice and
      services regarding a sale of all or a portion of the Company’s assets or
      outstanding securities or acquisitions contemplated by the Company
      (whether in one or a series of transactions, by merger, consolidation,
      reorganization, recapitalization,  joint venture or other
      business combination, asset or equity sale or
  otherwise);

            


    

     

    
      
         

      

      
        1

        
          
 

      

      
         

      

    

    
      
         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      

    

    
      	
              b)

            	
              assist
      in negotiations with interested acquirers or investors, current or
      potential lenders, creditors, shareholders and other interested parties
      regarding the Company’s operations and prospects and any potential
      Financial Transaction;

            


    

     

    
      	
              c)

            	
              render
      advice and services regarding any potential restructuring of the Company’s
      indebtedness; and

            


    

     

    
      	
              d)

            	
              render
      such other financial advisory and investment banking services as may be
      customary for a Financial Transaction of the type contemplated herein and
      mutually agreed upon by the parties
hereto.

            


    

     

    Gordian’s
services hereunder do not include the rendering of any valuation, fairness or
solvency opinions or other additional services not expressly referenced above;
any such services shall be addressed in a separate engagement letter as may be
agreed to by the Company and Gordian.

     

    In the
event the Company, its affiliates or its or their management receive or initiate
an inquiry or other contact concerning a Financial Transaction, the Company
shall promptly inform Gordian of such inquiry or contact with such prospective
Financial Partner, in order that Gordian can assist the Company in any resulting
negotiations in such manner as directed by the Company.

     

    In the
event the Company becomes a debtor under a Chapter 11 proceeding under title 11
of the United States Code (the “Bankruptcy Code”), the Company shall use its
reasonable best efforts to obtain from the applicable bankruptcy court prompt
authorization of the retention of Gordian pursuant to Sections 327(a) and 328 of
the Bankruptcy Code, nunc pro tunc to the date of the Company’s bankruptcy
filings, on the terms and conditions of this Agreement (it being understood and
agreed that the Company shall use reasonable best efforts to cause those terms
and conditions which relate to the fees payable to Gordian hereunder to be
included and accounted for in any loan documentation between the Company and any
lender).  The order of the bankruptcy court approving this Agreement
and authorizing Gordian’s retention in accordance with this Agreement shall be
in form and substance acceptable to Gordian in its sole reasonable discretion
and shall include, at Gordian’s option, such option to be exercised in its sole
reasonable discretion, an appropriate “carve out” from the collateral of the
relevant lenders, if any, of the Company for the payment of the aggregate fees
payable by the Company to Gordian pursuant to this Agreement.

     

    For
Gordian’s services in connection with this engagement, concurrently with and as
a condition to the consummation of any Financial Transaction the Company shall
pay or cause to be paid to Gordian in cash nonrefundable fees (the “Transaction
Fees”) as follows:

     

    
      
         

      

      
        2

        
          
 

      

      
         

      

    

    
      
         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      

    

    
      	
              a)  
        

            	
              5.00% of Aggregate Consideration (as defined
      below) that is paid, payable
      or realized in connection with the consummation of a Financial Transaction
      (other than a Reorganization (as defined below) or Excluded Transactions);
      and provided, further, that if such a Financial Transaction involves
      Yorkville Advisors, the payment (as to the Aggregate Consideration
      provided by Yorkville Advisors) shall be 3%;
    or

            


    

     

    
      	
              b)  
        

            	
              in
      the case of a Reorganization, the greater of (i) 5.00% of Aggregate
      Consideration (as defined below) that is paid or payable or realized in
      connection with the consummation of such Reorganization and (ii) 5.00% of
      the enterprise value (as determined by mutual agreement of the parties in
      good faith, which agreement shall not be unreasonably withheld) of the
      Company upon consummation of such
  Reorganization.

            


    

     

    Aggregate
Consideration, for purposes of calculating the Transaction Fees, shall be deemed
to be the total amounts paid to or for the benefit of, or realized by, the
Company, its security holders and/or its creditors in connection with a
Financial Transaction (and any transactions related thereto), including, without
limitation the principal amount of any debt, trade credit or obligations and/or
preferred stock directly or indirectly assumed, repaid, compromised, refinanced
or retired (as set forth on the most recent balance sheet of the Company), the
amount of any new debt and/or equity financing committed to or raised (or the
value realized from a sale of all or a part of the Company) in connection with
any Financial Transaction, any amounts paid into escrow and any amounts paid in
connection with the retirement or cancellation of any outstanding options, stock
appreciation rights or other derivative securities of the Company.

     

    In the
event that the Aggregate Consideration comprises securities, in whole or in
part, the value of such securities, for purposes of calculating the Transaction
Fees, shall be the fair market value thereof, as the parties hereto shall
mutually agree, on the day prior to the public announcement of such Financial
Transaction; provided, however, that the value of securities with an existing
public trading market shall be determined by the average of the last sales
prices for such securities on the five trading days ending five days prior to
the consummation of the Financial Transaction in question.

     

    A
“Reorganization”, for the purposes of calculating the Transaction Fees, shall be
deemed to be a recapitalization, restructuring or reorganization of all or a
portion of the Company’s balance sheet obligations whether or not pursuant to a
plan or reorganization approved by a bankruptcy court.

     

    
      
         

      

      
        3

        
          
 

      

      
         

      

    

    
      
         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      
The Transaction Fees shall
be paid in full simultaneously with the closing of a Financial Transaction (and
in no event later than the receipt of any portion of the Aggregate
Consideration) or, in the case of a Reorganization, paid in full as of the
effective date thereof; provided that if the Aggregate Consideration may be
increased, pursuant to the terms of the Financial Transaction, by contingent or
deferred payments related to future earnings or operations or other matters, the
portion of the Transaction Fees relating thereto shall be calculated and paid to
Gordian when and as such contingent or deferred payments are made.

     

    In
addition to the fees described above, Gordian shall be reimbursed upon invoice
for all of its reasonable out-of-pocket expenses (including legal, travel,
telephone and facsimile) incurred in connection with Gordian’s engagement
hereunder, as generally discussed with the Company in advance.

     

    Without
limiting the Transaction Fees, in consideration of the execution and delivery by
the parties hereto of this Agreement and the services hereunder, concurrently
with such execution and delivery the Company shall issue and deliver to Gordian
1,250,000 shares of Common Stock, par value $0.001 per share (“Common Stock”),
of the Company  free and clear of liens, encumbrances or other
restrictions other than the vesting provisions set forth herein and restrictions
on the disposition of any such shares imposed under applicable law (including,
without limitation, the Securities Act of 1933, as amended (the “Securities
Act”)).  For the avoidance of doubt, the shares issued and delivered
to Gordian pursuant to this paragraph (the “Gordian Shares”) shall not be
registered under the Securities Act.  The Gordian Shares shall vest in
three (3) equal installments on each of March  9, 2008, April 9, 2008
and May 9, 2008, provided,
that any unvested Gordian Shares shall automatically vest in full immediately
prior to the consummation of any Financial Transaction or immediately in the
event the Company terminates this Agreement other than due to a breach hereof by
Gordian or Gordian terminates this Agreement due to a breach hereof by the
Company; provided,
further, that any unvested Gordian Shares shall be forfeited and
cancelled in the event that Gordian terminates this Agreement other than due to
a breach hereof by the Company or the Company terminates this Agreement due to a
breach hereof by Gordian.  The Company represents and warrants to
Gordian that (i) it has the requisite power, authority and legal capacity to
execute, deliver and perform this Agreement; (ii) this Agreement has been duly
authorized, executed and delivered by it and constitutes its valid and binding
obligation, enforceable against it in accordance with its terms; and (iii) the
Gordian Shares have been duly and validly authorized and when issued, sold and
delivered in accordance with the terms hereof for the consideration expressed
herein, will be validly issued and fully paid and non-assessable. For as long as
Gordian remains a shareholder of the Company, the Company agrees that it will
not take any action or omit to take any action which would adversely affect the
rights, privileges or interests of Gordian (in its capacity as a shareholder)
disproportionately relative to the rights, privileges or interests of the other
holders of Common Stock without Gordian’s prior written
consent.   If shares of Common Stock of the Company are not able
to be issued to Gordian for any reason, the Company agrees to negotiate economic
equivalent compensation.

     

     

    
      
         

      

      
        4

        
          
 

      

      
         

      

    

    
      
         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      
The nature and scope of
Gordian’s investigation in connection with the matters described herein shall be
as Gordian deems appropriate.  Gordian shall familiarize itself with
and consider, as it deems appropriate, the history and nature of the business of
the Company, its operations, financial results and condition, properties and
prospects and such other factors as Gordian deems relevant.  In this
regard, Gordian shall be entitled to rely entirely on publicly available
information plus such other information as may be directly or indirectly
furnished to it orally or in writing by the Company or its officers, directors,
employees, affiliates, representatives, counsel, auditors and advisors, without
independent investigation thereof, and Gordian does not hereby assume any
responsibility to verify the accuracy or completeness of any such information or
to conduct any appraisal of the Company’s assets or liabilities.  The
Company represents and warrants to Gordian that, to the best of its knowledge,
all information it directly or indirectly furnishes to Gordian in connection
with Gordian’s engagement hereunder shall be true, complete and accurate in all
respects, and not misleading.  The Company agrees to cooperate fully
with Gordian and shall promptly make available to Gordian all such information,
documents and corporate records as Gordian deems necessary or
appropriate.

     

    Gordian
does not represent or guarantee any specific result from this engagement.
Gordian has not made, and is not responsible for the accuracy of, any projection
of the Company’s operating results, solvency or value, and Gordian does not make
any representation regarding or guaranty of the accuracy of any projection,
other view or advice Gordian provides regarding the Company or the Company’s
future.  The Company acknowledges that all future matters are subject
to certain risks and uncertainties that could cause actual results to differ
materially from those projected or otherwise addressed by Gordian.

     

    Gordian’s
role shall be solely as a financial advisor to the Company’s management and
Board of Directors, which shall remain fully responsible for all decisions and
matters as to which Gordian’s advice is sought.  Gordian is assuming
no management responsibility with respect to the Company of any nature
whatsoever.  Gordian’s obligations to the Board of Directors and the
Company are contractual in nature as expressly set forth in this Agreement and
neither Gordian nor any of its affiliates nor their respective members,
partners, officers, directors, employees, agents nor any entity or person
controlling Gordian or any of its affiliates have any fiduciary obligations to
the Board of Directors, the Company or any other person in respect
hereof.  The Company acknowledges and agrees that its engagement of
Gordian hereunder does not and is not intended to confer rights upon any person
not a party hereto, including any security holders or creditors of, or holders
of beneficial interests in, the Company, as against Gordian, its affiliates, or
their respective members, partners, officers, directors, employees, agents or
any entity or person controlling Gordian or any of its
affiliates.  

     

    
      
         

      

      
        5

        
          
 

      

      
         

      

    

    
      
         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      
The obligations of Gordian
under this Agreement and in respect of any transaction or conduct in connection
therewith are solely limited liability company obligations of
Gordian.  To the full extent lawful, no affiliate of Gordian or any
member, partner, officer, director, employee or agent of Gordian or such
affiliate, or any person controlling Gordian or any of its affiliates shall be
subjected to any personal liability whatsoever to the Company, its affiliates,
successors, assigns, creditors or security holders, or any other person, with
respect to this Agreement or any transaction or conduct in connection
therewith.

     

    Any
advice, written or oral, provided by Gordian pursuant to this Agreement shall be
solely for the information and assistance of the Company and its Board of
Directors in connection with the Financial Transaction.  Except as
required by law or court order, such advice is not to be used, circulated,
quoted or otherwise referred to, in whole or in part, for any other
purpose.  Such advice shall not be filed with, included in or referred
to, in whole or in part, in any registration statement, proxy statement, tender
offer or any other document, nor are references to Gordian or its engagement
hereunder to be made therein, except in each case in accordance with Gordian’s
prior written consent, which shall not be unreasonably
withheld.  Except to the extent legally required, none of: (i) the
fact that Gordian is rendering advice to the Company (except that the fact that
Gordian is rendering such advice may be disclosed to parties with which the
Company is negotiating); (ii) any advice rendered by Gordian to the Company; or
(iii) any communication from Gordian to the Company or from the Company to
Gordian in connection with the services performed by Gordian pursuant to this
Agreement shall be quoted or referred to orally or in writing in any public form
or forum or document by the Company, or its agents, without Gordian’s prior
written authorization, which shall not be unreasonably
withheld.  Except to the extent expressly set forth in writing by
Gordian, no third party shall be entitled to rely upon Gordian’s advice for any
purpose whatsoever.  Gordian shall bear no responsibility whatsoever
for the accuracy or completeness of the Company’s disclosure of Gordian’s advice
to any third parties.

     

    The
Company understands that Gordian does not represent that any particular Gordian
professional will be solely responsible for Gordian’s work product completed
pursuant to Gordian’s engagement and that junior Gordian professionals likely
will be working on this engagement together with senior Gordian
professionals.  Notwithstanding the foregoing, Peter S. Kaufman and
Henry F. Owsley shall be primarily responsible to provide the services described
hereunder (subject to circumstances beyond Gordian’s reasonable control) and
shall devote such time and effort as is required, consistent with Gordian’s
usual practices, to enable Gordian to fully perform all material obligations of
Gordian hereunder.

     

    The
Company agrees to indemnify and hold harmless Gordian and its affiliates and
their respective members, partners, officers, directors, employees, controlling
persons, representatives and agents (each an “Indemnified Party”) to the full
extent lawful from and against, and agrees that Gordian shall have no liability
to the Company or its affiliates, successors, assigns, creditors or security
holders for, any losses, claims, expenses, damages or liabilities (or actions or
proceedings in respect thereof), including without limitation counsel fees and
expenses, related to or arising out of its engagement under this Agreement, or
any transaction or conduct in connection therewith, except to the extent that
any such loss, claim, expense, damage or liability is finally judicially
determined to have resulted solely from its gross negligence or willful
misconduct in performing the services that are the subject of this
Agreement.  

     

    
      
         

      

      
        6

        
          
 

      

      
         

      

    

    
      
         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      
If for any reason the
foregoing indemnification is unavailable to any Indemnified Party or
insufficient to hold it harmless, then the Company shall contribute to the
amount paid or payable by such Indemnified Party as a result of such loss,
claim, expense, damage or liability in such proportion as is appropriate to
reflect not only the relative benefits received by the Company and/or its equity
holders on the one hand and the Indemnified Party on the other hand, but also
the relative fault of the Company and the Indemnified Party, as well as any
other relevant equitable considerations.  In no event shall Gordian
and the Indemnified Parties collectively have liability under this Agreement or
in respect of any transaction or conduct in connection herewith in the aggregate
in excess of any cash fees actually received by Gordian hereunder, exclusive of
reimbursement of expenses as provided in this Agreement and compensation as
referred to below in this paragraph.  Without the prior written
consent of Gordian (which shall not unreasonably be withheld), the Company shall
not settle any claim, litigation or other proceeding against any Indemnified
Party relating to Gordian’s engagement hereunder unless such settlement requires
on the part of the Indemnified Party nothing more than a cash payment that the
Company actually makes, and unless such settlement includes an express release
of such Indemnified Party from all claims against such Indemnified Party by all
parties to such settlement, such release to be set forth in an instrument or
instruments signed by or otherwise binding upon all parties to such
settlement.  The Company agrees to reimburse each Indemnified Party,
promptly upon each request for reimbursement hereunder, for its reasonable legal
and other out-of-pocket expenses (including the cost of any investigation,
preparation or provision of evidence) incurred in connection with any pending or
threatened action, claim, investigation or proceeding (regardless of whether
Gordian is a party thereto) in respect of which indemnification or contribution
may be sought hereunder or in enforcing this Agreement, including, without
limitation, any pending or threatened action, claim, investigation or proceeding
brought by the Company, provided that each Indemnified Party shall agree in
writing prior to such reimbursement, that in the event such Indemnified Party
receives such reimbursement, such Indemnified Party shall repay to the Company
the amount of such reimbursement to the extent that it shall be finally
judicially determined that such Indemnified Party was not entitled to
indemnification under the provisions of this paragraph.  If Gordian,
any affiliate of Gordian, or any member, partner, officer, director, employee,
agent or any entity or person controlling Gordian or any affiliate of Gordian
becomes involved in any threat or assertion of a claim, litigation or
investigation with respect to this engagement, then Gordian shall be
compensated, separately from the fees provided for herein, for the time expended
by such person, whether at or in preparation for meetings, depositions, trial or
otherwise at the hourly rates then in effect for such person or, if no such rate
is then in effect, the hourly rate that Gordian shall reasonably determine to be
appropriate.  

     

    
      
         

      

      
        7

        
          
 

      

      
         

      

    

    
      
         

        
          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      
The reimbursement,
indemnity and contribution agreements of the Company under this paragraph shall
be in addition to any liability which the Company otherwise may have and to any
rights that Gordian may otherwise have, and shall extend upon the same terms and
conditions to, and may be independently enforced by, any affiliate of Gordian
and the members, partners, officers, directors, employees, controlling persons,
representatives and agents (if any) of Gordian or any affiliate of Gordian and
shall be binding upon any successors and assigns of the Company and inure to the
benefit of any successors, assigns, heirs and personal representatives of
Gordian, any such affiliate and any such person.  The provisions of
this and the following four paragraphs shall survive the completion or
termination of Gordian’s services pursuant to this Agreement or any termination
of this Agreement.

     

    THIS
LETTER AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK (WITHOUT REFERENCE TO ITS PRINCIPLES OF CONFLICT OF
LAW).  THE PARTIES HERETO HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN
CONNECTION WITH ANY DISPUTES ARISING HEREUNDER.  The Company hereby
consents to venue and jurisdiction in any court in which Gordian (or other
Indemnified Party) is sued or otherwise found or brought.  To the
extent permitted by applicable law, any dispute arising under this Agreement or
in connection with this engagement shall be finally settled by arbitration
conducted in New York, New York by one arbitrator in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (the
“AAA”).  The arbitration award entered in accordance with this
Agreement shall be in writing and shall be final and binding on the parties,
except to the extent it may be appealed to a court of competent jurisdiction in
accordance with applicable laws governing appealability of arbitration
awards.  The award may include an award of costs, including reasonable
attorneys’ fees and disbursements.  Judgment upon the award may be
entered by any court having jurisdiction over the parties or their
assets.  The parties hereto consent to the non-exclusive jurisdiction
of the federal and state courts sitting in New York City for the purpose of
entering judgment upon and enforcing such an award.

     

    This
engagement may be terminated by the Company or Gordian at any time with or
without cause, effective upon receipt of written notice to that effect by the
other party, but in such circumstance the Company shall remain liable for any
Transaction Fees payable or accrued and expenses incurred prior to
termination.  In the event of termination of this engagement the
Company shall also remain liable for the Transaction Fees if within twelve (12)
 months after such termination definitive documentation is entered into
with respect to a Financial Transaction and such Financial Transaction is
subsequently consummated; provided, however, that the Company shall not be
liable for the Transaction Fee if Gordian has terminated the engagement even
though the Company has fulfilled all of (and has not repudiated or
anticipatorily breached any of) its material obligations hereunder as of the
date of such termination.

     

    
      
         

      

      
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          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      
This Agreement contains the
entire agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, between
Gordian and the Company with respect thereto.  This Agreement shall be
binding upon and inure to the benefit of any successors, assigns, heirs and
personal representatives of the parties.  This Agreement may not be
amended or modified except in writing, executed by the parties
hereto.  No party hereto may assign this Agreement.

     

    The
Company’s obligations hereunder shall be joint and several obligations
of  Torrent Energy Corporation and each of its subsidiaries, it being
understood and agreed that the Company will cause the subsidiaries of the
Company to perform the Company’s obligations hereunder; provided, however, that
no such subsidiary shall be required to pay any amount that would cause it to
become insolvent and any such amount not so paid shall be reallocated among the
remaining such subsidiaries.

     

    Please
confirm that the foregoing is in accordance with your understanding by signing
and returning to us the duplicate of this letter attached hereto, which shall
thereupon constitute a binding agreement.

     

    
      
        	 	Sincerely
      yours,	 
	 	 	 
	 	GORDIAN
      GROUP, LLC	 
	 	 	 	 
	 	
                By:
      

              	/s/ Henry
      F. Owsley	 
	 	 	Henry
      F. Owsley	 
	 	 	Chief
      Executive Officer	 
	 	 	 	 


      



    AGREED TO
AND ACCEPTED:

     

    Torrent
Energy Corporation

     

    By:  /s/
John D.
Carlson                                           

        Name:
John D. Carlson

        Title:
President and Chief Executive Officer

     

    Date:   February
15, 1008

     

    ACKNOWLEDGED
AND AGREED WITH RESPECT TO THE ISSUANCE OF THE GORDIAN SHARES IN ACCORDANCE WITH
THE TERMS HEREOF:

     

    YA GLOBAL
INVESTMENTS, LP (F/K/A CORNELL CAPITAL PARTNERS, LP)

     

    
      
         

      

      
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          	Gordian Group
      LLC	

                  www.gordiangroup.com

                


        

         

         

      

    

    By:          __________________________

    Name:

    Title:

     

    Date:       __________________________

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
      
         

      

      
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        	Gordian Group
      LLC	

                www.gordiangroup.com

              


      

       

    

     

    EXHIBIT
A

     

    EXCLUDED
TRANSACTIONS

     

    	
        FUNDING
  PROVIDED BY HALIBURTON, CALFRAC AND CANYONTECH IN CONNECTION WITH FRAC
  SERVICES IN COOS BAY IN EXCHANGE FOR WORKING INTERESTS OR COMPARABLE
  CONSIDERATION; PROVIDED, HOWEVER, THAT IF THE COMPANY ASKS FOR GORDIAN’S
  ASSISTANCE IN CONNECTION WITH SUCH A FRAC SERVICE PROVIDER, THEN NEGOTIATIONS
  WITH SUCH PROVIDER SHALL NO LONGER BE EXCLUDED.

      


    	
        FUNDING
  PROVIDED BY OKLACO, NATURAL GAS PARTNERS AND VENACO AS JOINT VENTURE PARTNERS;
  PROVIDED, HOWEVER, THAT IF THE COMPANY ASKS FOR GORDIAN’S ASSISTANCE IN
  CONNECTION WITH SUCH A JOINT VENTURER, THEN NEGOTIATIONS WITH SUCH JOINT
  VENTURER SHALL NO LONGER BE EXCLUDED.

      


     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    11