Exhibit 10.2


Execution Version


 


CONTRIBUTION
AGREEMENT


AMONG


EQUITABLE
PRODUCTION COMPANY


 


EQUITABLE
GATHERING EQUITY, LLC


 


PINE MOUNTAIN OIL
AND GAS, INC.


AND


NORA GATHERING,
LLC


Dated as of April
13, 2007
















TABLE OF CONTENTS


	
  

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE 1 ASSETS CONTRIBUTION

  	
  1

  
	
  Section
  1.1

  	
  Contribution of Assets

  	
  1

  
	
  Section
  1.2

  	
  Assets

  	
  2

  
	
  Section
  1.3

  	
  Excluded Assets

  	
  2

  
	
  Section
  1.4

  	
  Certain Definitions

  	
  3

  
	
  Section
  1.5

  	
  Effective Time; Proration of Costs and Revenues

  	
  6

  
	
  Section
  1.6

  	
  Intentions of the Parties

  	
  6

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2 CASH CONTRIBUTION, DISTRIBUTIONS AND
  LOANS

  	
  7

  
	
  Section
  2.1

  	
  Cash Contribution

  	
  7

  
	
  Section
  2.2

  	
  Effective Time Adjustment

  	
  7

  
	
  Section
  2.3

  	
  Cash Distributions and Loans

  	
  9

  
	
  Section
  2.4

  	
  Capital Account Balances

  	
  9

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3 TITLE MATTERS

  	
  9

  
	
  Section
  3.1

  	
  Title

  	
  9

  
	
  Section
  3.2

  	
  Definitions of Defensible Title and Permitted
  Encumbrances

  	
  10

  
	
  Section
  3.3

  	
  Notice of Asserted Title Defects; Defect
  Adjustments

  	
  11

  
	
  Section
  3.4

  	
  Consents to Assignment and Preferential Rights
  to Purchase

  	
  14

  
	
  Section
  3.5

  	
  Casualty or Condemnation Loss

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF
  EQUITABLE

  	
  16

  
	
  Section
  4.1

  	
  Disclaimers

  	
  16

  
	
  Section
  4.2

  	
  EPC

  	
  17

  
	
  Section
  4.3

  	
  EGEL

  	
  18

  
	
  Section
  4.4

  	
  Liability for Brokers’ Fees

  	
  19

  
	
  Section
  4.5

  	
  Consents, Approvals or Waivers

  	
  19

  
	
  Section
  4.6

  	
  Litigation

  	
  20

  
	
  Section
  4.7

  	
  Taxes

  	
  20

  
	
  Section
  4.8

  	
  Environmental Laws

  	
  20

  
	
  Section
  4.9

  	
  Compliance with Laws

  	
  20

  
	
  Section
  4.10

  	
  Contracts

  	
  20

  
	
  Section
  4.11

  	
  Permits, etc.

  	
  21

  
	
  Section
  4.12

  	
  Outstanding Capital Commitments

  	
  21

  
	
  Section
  4.13

  	
  Abandonment

  	
  21

  
	
  Section
  4.14

  	
  Condition of Equipment, etc.

  	
  21

  
	
  Section
  4.15

  	
  Payments of Property Costs

  	
  21

  
	
  Section
  4.16

  	
  Absence of Certain Events

  	
  21

  
	
  Section
  4.17

  	
  Regulatory Matters

  	
  21

  
	
  Section
  4.18

  	
  Information

  	
  22

  
	
  Section
  4.19

  	
  Sole Member

  	
  22

  



 



 i
 









 


	
  ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF PMOG

  	
  22

  
	
  Section
  5.1

  	
  Existence and Qualification

  	
  22

  
	
  Section
  5.2

  	
  Power

  	
  22

  
	
  Section
  5.3

  	
  Authorization and Enforceability

  	
  22

  
	
  Section
  5.4

  	
  No Conflicts

  	
  22

  
	
  Section
  5.5

  	
  Liability for Brokers’ Fees

  	
  23

  
	
  Section
  5.6

  	
  Consents, Approvals or Waivers

  	
  23

  
	
  Section
  5.7

  	
  Litigation

  	
  23

  
	
  Section
  5.8

  	
  Financing

  	
  23

  
	
  Section
  5.9

  	
  Independent Investigation

  	
  23

  
	
  Section
  5.10

  	
  Equitable Information

  	
  23

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF THE
  COMPANY

  	
  24

  
	
  Section
  6.1

  	
  Existence and Qualification

  	
  24

  
	
  Section
  6.2

  	
  Valid Issuance

  	
  24

  
	
  Section
  6.3

  	
  Power

  	
  24

  
	
  Section
  6.4

  	
  Authorization and Enforceability

  	
  24

  
	
  Section
  6.5

  	
  No Conflicts

  	
  24

  
	
  Section
  6.6

  	
  Consents, Approvals or Waivers

  	
  25

  
	
  Section
  6.7

  	
  Litigation

  	
  25

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7 COVENANTS OF THE PARTIES

  	
  25

  
	
  Section
  7.1

  	
  Access

  	
  25

  
	
  Section
  7.2

  	
  Indemnity Regarding Access

  	
  25

  
	
  Section
  7.3

  	
  Pre-Closing Notifications

  	
  26

  
	
  Section
  7.4

  	
  Confidentiality, Public Announcements

  	
  26

  
	
  Section
  7.5

  	
  Governmental Reviews

  	
  27

  
	
  Section
  7.6

  	
  Tax Matters

  	
  27

  
	
  Section
  7.7

  	
  Further Assurances

  	
  29

  
	
  Section
  7.8

  	
  Assumption of Obligations

  	
  29

  
	
  Section
  7.9

  	
  Pipeline Agreement

  	
  29

  
	
  Section
  7.10

  	
  Operation of Assets

  	
  30

  
	
  Section
  7.11

  	
  Financial Information

  	
  30

  
	
  Section
  7.12

  	
  Termination of Gas Gathering Agreement

  	
  30

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8 CONDITIONS TO CLOSING

  	
  31

  
	
  Section
  8.1

  	
  Conditions of Equitable to Closing

  	
  31

  
	
  Section
  8.2

  	
  Conditions of PMOG to Closing

  	
  32

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9 CLOSING

  	
  33

  
	
  Section
  9.1

  	
  Time and Place of Closing

  	
  33

  
	
  Section
  9.2

  	
  Closing Deliveries of Equitable

  	
  33

  
	
  Section
  9.3

  	
  Closing Deliveries of PMOG

  	
  34

  
	
  Section
  9.4

  	
  Closing Deliveries of the Company

  	
  35

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10 TERMINATION AND AMENDMENT

  	
  35

  
	
  Section
  10.1

  	
  Termination

  	
  35

  



 



 ii
 









 


	
  Section 10.2

  	
  Effect of Termination

  	
  36

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11 INDEMNIFICATIONS; LIMITATIONS

  	
  36

  
	
  Section
  11.1

  	
  Indemnification

  	
  36

  
	
  Section
  11.2

  	
  Indemnification Actions

  	
  39

  
	
  Section
  11.3

  	
  Limitation on Actions

  	
  40

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12 MISCELLANEOUS

  	
  41

  
	
  Section
  12.1

  	
  Receipts

  	
  41

  
	
  Section
  12.2

  	
  Property Costs

  	
  42

  
	
  Section
  12.3

  	
  Counterparts

  	
  42

  
	
  Section
  12.4

  	
  Notices

  	
  42

  
	
  Section
  12.5

  	
  [Intentionally Omitted]

  	
  43

  
	
  Section
  12.6

  	
  Expenses

  	
  43

  
	
  Section
  12.7

  	
  Replacement of Bonds, Letters of Credit and
  Guarantees

  	
  43

  
	
  Section
  12.8

  	
  Governing Law; Jurisdiction; Court Proceedings

  	
  43

  
	
  Section
  12.9

  	
  Records

  	
  44

  
	
  Section
  12.10

  	
  Captions

  	
  44

  
	
  Section
  12.11

  	
  Waivers

  	
  44

  
	
  Section
  12.12

  	
  Assignment

  	
  44

  
	
  Section
  12.13

  	
  Entire Agreement

  	
  44

  
	
  Section
  12.14

  	
  Amendment

  	
  45

  
	
  Section
  12.15

  	
  No Third Person Beneficiaries

  	
  45

  
	
  Section
  12.16

  	
  References

  	
  45

  
	
  Section
  12.17

  	
  Construction

  	
  45

  
	
  Section
  12.18

  	
  Limitation on Damages

  	
  45

  
	
  Section
  12.19

  	
  Attorneys’ Fees

  	
  46

  



 



 iii
 









EXHIBITS:


	
  Exhibit A-1

  	
  Gathering Assets

  
	
  Exhibit A-2

  	
  Water Disposal Wells; Other Excluded Assets

  
	
  Exhibit A-3

  	
  Equipment, Machinery, Fixtures and Other Tangible
  Personal Property and Improvements

  
	
  Exhibit A-4

  	
  Other Excluded Assets

  
	
  Exhibit A-5

  	
  Delinquent Liens for Current Taxes or Assessments

  
	
  Exhibit A-6

  	
  Delinquent Liens Arising in the Ordinary Course of
  Business

  
	
  Exhibit B

  	
  Form of Conveyance

  
	
  Exhibit C

  	
  Form of Amended and Restated Limited Liability
  Company Agreement of Nora Gathering, LLC

  
	
  Exhibit D

  	
  Form of Assignment of Easement Agreement

  
	
  Exhibit E

  	
  Form of Note

  
	
  Exhibit F

  	
  Permitted Encumbrances

  
	
  Exhibit G

  	
  Form of Gathering Agreement

  
	
  Exhibit H

  	
  Form of Gas Purchase Agreement

  
	
  Exhibit I

  	
  [Intentionally Omitted]

  
	
  Exhibit J

  	
  [Intentionally Omitted]

  
	
  Exhibit K

  	
  Nora-T Line

  
	
  Exhibit L

  	
  Form of Change of Control Agreement

  
	
  Exhibit M

  	
  Form of Equitable Guaranty

  
	
  Exhibit N

  	
  Form of Range Guaranty

  
	
  Exhibit O

  	
  Form of Interconnect Agreement

  



 


SCHEDULES:


 


	
  Schedule 4.2(d)

  	
  Conflicts (EPC)

  
	
  Schedule 4.3(d)

  	
  Conflicts (EGEL)

  
	
  Schedule 4.5

  	
  Consents, Approvals or Waivers (EPC and EGEL)

  
	
  Schedule 4.6A

  	
  Litigation

  
	
  Schedule 4.6B

  	
  Litigation

  
	
  Schedule 4.7

  	
  Taxes and Assessments

  
	
  Schedule 4.9

  	
  Compliance with Laws

  
	
  Schedule 4.10

  	
  Contracts

  
	
  Schedule 4.11

  	
  Permits

  
	
  Schedule 4.12

  	
  Outstanding Capital Commitments

  
	
  Schedule 4.13

  	
  Abandonment

  
	
  Schedule 4.14

  	
  Condition of Equipment, etc.

  
	
  Schedule 4.16

  	
  Certain Events

  
	
  Schedule 7.10

  	
  Operation of Assets

  



 



 iv
 









Index of Defined Terms


	
  Defined Term

  	
   

  	
  Section

  
	
   

  	
   

  	
   

  
	
  Affiliate

  	
   

  	
  Section 1.4(a)

  
	
  Agreement

  	
   

  	
  Preamble

  
	
  Assets

  	
   

  	
  Section 1.2

  
	
  Asserted Title Defect

  	
   

  	
  Section 3.2(a)

  
	
  Asserted Title Defect Amount

  	
   

  	
  Section 3.3(c)

  
	
  Business Day

  	
   

  	
  Section 1.4(c)

  
	
  Cash Contribution

  	
   

  	
  Section 2.1

  
	
  Change of Control Agreement

  	
   

  	
  Section 9.2(g)

  
	
  Chosen Court

  	
   

  	
  Section 12.8

  
	
  Claim

  	
   

  	
  Section 11.2(b)

  
	
  Claim Notice

  	
   

  	
  Section 11.2(b)

  
	
  Closing

  	
   

  	
  Section 9.1

  
	
  Closing Date

  	
   

  	
  Section 9.1

  
	
  Closing Payment

  	
   

  	
  Section 2.2(a)

  
	
  Company

  	
   

  	
  Preamble

  
	
  Company Indemnified Persons

  	
   

  	
  Section 11.1(b)

  
	
  Consents

  	
   

  	
  Section 4.5

  
	
  Contracts

  	
   

  	
  Section 1.2(b)

  
	
  Conveyance

  	
   

  	
  Section 9.2(a)

  
	
  Damages

  	
   

  	
  Section 11.1(e)

  
	
  Defensible Title

  	
   

  	
  Section 3.2(a)

  
	
  Easements

  	
   

  	
  Section 1.2(c)

  
	
  Equitable

  	
   

  	
  Preamble

  
	
  Equitable Indemnified Persons

  	
   

  	
  Section 11.1(c)

  
	
  Effective Time

  	
   

  	
  Section 1.4(d)

  
	
  Effective Time Adjustment

  	
   

  	
  Section 2.2(a)

  
	
  EGEL

  	
   

  	
  Preamble

  
	
  Encumbrances

  	
   

  	
  Section 3.2(a)

  
	
  Environmental Laws

  	
   

  	
  Section 4.8

  
	
  EPC

  	
   

  	
  Preamble

  
	
  Equitable

  	
   

  	
  Preamble

  
	
  Exchange Act

  	
   

  	
  Section 1.4(e)

  
	
  Excluded Assets

  	
   

  	
  Section 1.3

  
	
  Execution Date

  	
   

  	
  Preamble

  
	
  Exploration Agreement

  	
   

  	
  Section 1.4(f)

  
	
  Exploration Agreement PMOG Area

  	
   

  	
  Section 1.4(g)

  
	
  Gathering Agreement

  	
   

  	
  Section 9.2(e)

  
	
  Gathering Assets

  	
   

  	
  Section 1.2(a)

  
	
  Governmental Authority

  	
   

  	
  Section 1.4(h)

  
	
  Governmental Permits

  	
   

  	
  Section 4.11

  
	
  HSR Act

  	
   

  	
  Section 7.5

  
	
  Hydrocarbons

  	
   

  	
  Section 1.4(i)

  



 



 v
 









 


	
  Indemnified Person

  	
   

  	
  Section 11.2(a)

  
	
  Indemnifying Person

  	
   

  	
  Section 11.2(a)

  
	
  Laws

  	
   

  	
  Section 1.4(j)

  
	
  Letter of Intent

  	
   

  	
  Section 12.13

  
	
  LLC Agreement

  	
   

  	
  Section 9.2(d)

  
	
  Material Adverse Effect

  	
   

  	
  Section 4.1(d)

  
	
  New Easement Agreement

  	
   

  	
  Section 9.3(d)

  
	
  New Lease

  	
   

  	
  Section 1.4(k)

  
	
  Nora Field

  	
   

  	
  Section 1.4(l)

  
	
  Nora-T Line

  	
   

  	
  Section 1.4(m)

  
	
  Original Lease

  	
   

  	
  Section 1.4(n)

  
	
  Party; Parties

  	
   

  	
  Preamble

  
	
  Party Lawsuit

  	
   

  	
  Section 1.4(o)

  
	
  Permitted Encumbrances

  	
   

  	
  Section 3.2(b)

  
	
  Person

  	
   

  	
  Section 1.4(p)

  
	
  Pipeline Agreement

  	
   

  	
  Recitals

  
	
  PMOG

  	
   

  	
  Preamble

  
	
  PMOG Indemnified Persons

  	
   

  	
  Section 11.1(b)

  
	
  Pre-Closing Taxable Period

  	
   

  	
  Section 7.6(c)

  
	
  Preferential Rights

  	
   

  	
  Section 4.5

  
	
  Property Costs

  	
   

  	
  Section 1.5(c)

  
	
  Purchase Agreement

  	
   

  	
  Section 1.4(q)

  
	
  Records

  	
   

  	
  Section 1.4(r)

  
	
  Scheduled Transfer Requirements

  	
   

  	
  Section 4.5(a)

  
	
  SEC

  	
   

  	
  Section 1.4(s)

  
	
  Securities Act

  	
   

  	
  Section 1.4(t)

  
	
  Statements of Revenues and Expenses

  	
   

  	
  Section 7.11

  
	
  Straddle Taxable Period

  	
   

  	
  Section 7.6(c)

  
	
  Tax

  	
   

  	
  Section 1.4(u)

  
	
  Tax Return

  	
   

  	
  Section 1.4(v)

  
	
  Termination Date

  	
   

  	
  Section 10.1

  
	
  Title Arbitrator

  	
   

  	
  Section 3.3(f)

  
	
  Title Claim Date

  	
   

  	
  Section 3.3(a)

  
	
  Title Defects

  	
   

  	
  Section 3.2(a)

  
	
  Transaction Documents

  	
   

  	
  Section 12.13

  
	
  Transfer Taxes

  	
   

  	
  Section 1.4(w)

  



 



 vi















CONTRIBUTION AGREEMENT


This
Contribution Agreement (this “Agreement”), dated as of April 13, 2007, (the “Execution
Date”) is by and among Equitable Production Company, a Pennsylvania corporation
(“EPC”), Equitable Gathering Equity, LLC, a Delaware limited liability company
(“EGEL”, and, collectively with EPC, “Equitable”), Pine Mountain Oil and Gas,
Inc., a Virginia corporation (“PMOG”), and Nora Gathering, LLC, a Delaware
limited liability company (the “Company”). 
EPC, EGEL, PMOG and the Company are sometimes referred to herein,
collectively, as the “Parties” and, individually, as a “Party.”


RECITALS:


WHEREAS,
EPC and EGEL are the owners of various natural gas pipeline gathering
facilities and pipelines, commonly known as the Nora Gas Gathering System (including
the Nora-T pipeline), located in Dickenson, Buchanan, Wise and Russell
Counties, Virginia, and used in the gathering of natural gas from the Nora
Field, as further described herein;


WHEREAS,
such gathering facilities and pipelines are situated upon, through and/or under
various properties, which are owned or held by EPC, PMOG, and/or EGEL by virtue
of various agreements or conveyances;


WHEREAS,
EPC and EGEL have entered into that certain Pipeline Agreement dated as of
January 1, 2005 (the “Pipeline Agreement”), for the lease and/or sublease of
facilities and pipelines relating to such gathering system;


WHEREAS,
Equitable desires to contribute such gathering facilities and pipelines,
together with all of Equitable’s other rights, titles and interests in and to
such gathering facilities  and
pipelines and the Pipeline Agreement,
to the Company on the terms and conditions hereinafter set forth; and


WHEREAS,
PMOG desires to contribute a specified amount of cash and certain assets to the
Company on the terms and conditions hereinafter set forth.


NOW,
THEREFORE, in consideration of the premises and of the mutual promises,
representations, warranties, covenants, conditions and agreements contained
herein, and for other valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Parties agree as follows:


ARTICLE 1  

ASSETS CONTRIBUTION


Section 1.1            Contribution
of Assets.  On the
terms and conditions contained in this Agreement, Equitable agrees to
contribute to the Company and the Company agrees to accept



 1
 









from Equitable the
Assets.  As consideration for the
contribution of the Assets, the Company shall issue to EGEL a fifty percent
(50%) membership interest in the Company.


Section 1.2            Assets.  “Assets” means all of the
right, title and interest of Equitable in and to the following:


(a)   the
gas gathering system, facilities, compressors, pipelines, pig and other
stations and Easements described on Exhibit A-1 (the “Gathering Assets”);


(b)   all
presently existing contracts, agreements and instruments by which the Assets
are bound or subject, including operating agreements, pipeline agreements,
declarations and orders, exchange agreements, and transportation agreements,
but excluding any contract, agreement or instrument to the extent that (1)
transfer is restricted by third-party agreement or applicable Law, (2)
Equitable  is unable to
obtain, using commercially reasonable efforts, a waiver of, or otherwise
satisfy, such transfer restriction  (provided  that  Equitable  shall  not  be  required to provide
consideration or undertake  obligations to
or for the benefit of  the holders of
such rights in order to obtain any necessary consent or waiver), and (3) the
failure to obtain such waiver or satisfy such transfer restriction would cause
a termination of such contract, agreement or instrument or a material
impairment of the rights thereunder (subject to such exclusions, the “Contracts”);


(c)   all
easements, permits, licenses, servitudes, rights-of-way, surface leases and
other surface rights appurtenant to, and used or held for use primarily in
connection with, the Gathering Assets or other Assets (the “Easements”),
including those Easements described on Exhibit A-1, but excluding any of the
foregoing to the extent that (1) transfer is restricted by third-party
agreement or applicable Law, (2) Equitable is unable to obtain, using
commercially reasonable efforts, a waiver of, or otherwise satisfy, such
transfer restriction (provided that Equitable shall not be required to provide
consideration or undertake obligations to or for the benefit of the holders of
such rights in order to obtain any necessary consent or waiver), and (3) the
failure to obtain such waiver or satisfy such transfer restriction would cause
a termination of such permit or other instrument or a material impairment of
the rights thereunder;


(d)   all
gathering lines, pipelines, compressors, equipment, machinery, fixtures and
other tangible personal property and improvements used or held for use
primarily in connection with the ownership or operation of the Gathering Assets
or other Assets, but excluding any such items included in the Excluded Assets;
and


(e)   the
Records.


Section 1.3            Excluded
Assets.  Notwithstanding
anything to the contrary contained herein, the Assets shall not include, and the
following are excepted, reserved and excluded from the transactions
contemplated hereby (collectively, the “Excluded Assets”):



 2
 









(a)   all
water disposal wells, and any transfer facility, loadout facility or other
facility associated with such water disposal wells, primarily used in
connection with the disposal of produced water derived from or otherwise
attributable to any of the wells that produce gas transported through the
Gathering Assets, including those water disposal wells and associated
facilities described on Exhibit A-2;


(b)   all
corporate, financial, income and franchise tax and legal records of Equitable
that relate to Equitable’s business generally (other than those relating
primarily to the Assets), and all books, records and files that relate to the
Excluded Assets and copies of any Records retained by Equitable; 


(c)   (i)
equipment, machinery, fixtures and other tangible property and improvements
described on Exhibit A-3 attached hereto; (ii) computers and peripheral
equipment related to such equipment; (iii) communication and telecommunication
equipment including but not limited to radios, towers, and networking
equipment; (iv) custom applications and databases; (v) measurement and data
collection devices; and (vi) software and associated licenses, including but
not limited to any software relating to the SCADA System, Enertia, Altra,
Flow-Cal, Talon, Aries, Production Access, Pre-drill Manager, Geographix,
Synergy, and CygNet;


(d)   all
rights and all obligations of  Equitable
with respect to any refund or payment of Taxes or other costs or expenses borne
by Equitable or Equitable’s predecessors in interest and title attributable to
the Assets and the period prior to the Effective Time;


(e)   all
rights and all obligations of Equitable with respect to the claims and causes
of action relating to the Assets that accrued or arose prior to the Effective
Time (other than claims or causes of action for proceeds to which the Company
is entitled under Section 1.5(b));


(f)    Equitable’s
area-wide bonds, permits and licenses (including all Federal Communications
Commission licenses) or other permits, licenses or authorizations used in the
conduct of Equitable’s business generally and not exclusively related to the
Gathering Assets; and


(g)   those
other assets and interests identified on Exhibit A-4.


Section 1.4            Certain
Definitions.  As
used herein:


(a)   “Affiliate”
means, with respect to any Person, a Person that directly or indirectly
controls, is controlled by or is under common control with such Person, with
control in such context meaning (i) the power to direct the vote of more than
fifty percent (50%) of the voting shares or other securities of such Person
through ownership, pursuant to a written agreement, or otherwise or (ii) the
power to direct the management and policies of a Person through ownership of
voting shares or other securities, pursuant to a



 3
 









written agreement, or otherwise. 
For the purposes of this Agreement, the Company shall not be considered
an Affiliate of any Party or such Party’s Affiliates.


(b)   [Intentionally
omitted].


(c)   “Business
Day” means any day other than a Saturday, a Sunday, or a day on which banks are
closed for business in Pittsburgh, Pennsylvania or Fort Worth, Texas.


(d)   “Effective
Time” means 12:01 a.m. local time where the Assets are located on
June 1, 2006.


(e)   “Exchange
Act” means the Securities Exchange Act of 1934, as amended.


(f)    “Exploration
Agreement” has the meaning given to such term in the Purchase Agreement.


(g)   “Exploration
Agreement PMOG Area” has the meaning given to such term in the Purchase
Agreement.


(h)   “Governmental
Authority” means any government and/or any political subdivision thereof,
including departments, courts, commissions, boards, bureaus, ministries,
agencies or other instrumentalities.


(i)    “Hydrocarbons”
means all oil, gas, coalbed methane gas and other associated hydrocarbons.  


(j)    “Laws”
means all laws, statutes, rules, regulations, ordinances, orders, requirements
and codes of Governmental Authorities.


(k)   “New
Lease” has the meaning given to such term in the Purchase Agreement.


(l)    “Nora
Field” has the same meaning as the term “AMI” in the Operating Agreement (as
defined in the Purchase Agreement).


(m)  “Nora-T
Line” means the pipeline depicted on Exhibit K.


(n)   “Original
Lease” has the meaning given to such term in the Purchase Agreement.


(o)   “Party
Lawsuit” means the ongoing litigation and claims in the action styled as Pine
Mountain Oil & Gas, Inc. v. Equitable Production Company, USDC WD Va,
Abingdon Division, CA No. 1:05CV095 (including the related September 22, 2005
arbitration proceeding).


(p)   “Person”
means any individual, corporation, partnership, limited liability company,
trust, estate, Governmental Authority or any other entity.



 4
 









(q)   “Purchase
Agreement” means that certain Purchase and Sale Agreement of even date herewith
between EPC and PMOG.


(r)    “Records”
means all gathering and transportation files, compression files,
land files and surveys, Contract files and all other books, records, data,
files, maps and accounting records to the extent relating primarily to the
Assets, excluding however, (A) any record to the extent that: (1) disclosure or
transfer of such record is restricted by any third-party agreement or
applicable Law, (2) Equitable is unable to obtain, using commercially reasonable
efforts, a waiver of, or otherwise satisfy, such disclosure restriction
(provided that Equitable shall not be required to provide consideration or
undertake obligations to or for the benefit of the holders of such rights in
order to obtain any necessary consent or waiver) and (3) the failure to obtain
such waiver or satisfy such disclosure restriction would cause a termination of
such instrument or a material impairment of the rights thereunder; (B) computer
software; (C) all legal records and legal files of Equitable (other than (x)
title opinions and (y) Contracts) and all other work product of and
attorney-client communications with any of Equitable’s legal counsel; (D)
records relating to the sale of the Assets, including bids received from and
records of negotiations with third Persons; (E) any other records to the extent
constituting Excluded Assets; and (F) contracts and agreements of no further
force and effect as of the Effective Time.


(s)   “SEC”
means the U.S. Securities and Exchange Commission.


(t)    “Securities
Act” means the Securities Act of 1933, as amended, and any successor statute
thereto and the rules and regulations of the SEC promulgated thereunder.


(u)   “Tax”
means all taxes, including income tax, surtax, remittance tax, presumptive tax,
net worth tax, production tax, pipeline transportation tax, value added tax,
withholding tax, gross receipts tax, windfall profits tax, profits tax,
severance tax, personal property tax, real property tax, sales tax, service
tax, transfer tax, use tax, excise tax, premium tax, customs duties, stamp tax,
motor vehicle tax, entertainment tax, insurance tax, capital stock tax,
franchise tax, occupation tax, payroll tax, employment tax, social security,
unemployment tax, disability tax, alternative or add-on minimum tax, estimated
tax, and any other assessments, duties, fees, or levies imposed by a
Governmental Authority, together with any interest, fine or penalty thereon, or
addition thereto.


(v)   “Tax
Return” means any return, declaration, report, claim for refund, or information
return or statement relating to Taxes, including any schedule or attachment
thereto, and including any amendment thereof, required to be filed with any
Governmental Authority.


(w)  “Transfer
Taxes” means all transfer, sales, use, documentary, stamp duty, conveyance and
other similar Taxes, duties, fees or charges.



 5
 









Section 1.5            Effective
Time; Proration of Costs and Revenues. 



(a)   Title
and interest in and to the Assets shall be transferred from Equitable to the
Company at the Closing, but certain financial benefits and burdens in respect
of the Assets shall be transferred effective as of the Effective Time, as
described below.


(b)   The
Company shall be entitled to all income, proceeds, receipts and credits earned
with respect to the Assets on and after the Effective Time, and shall be
responsible for (and entitled to any refunds with respect to) all Property
Costs incurred on and after the Effective Time (provided that the Company’s
entitlement to income, proceeds, receipts and credits earned with respect to,
and responsibility for and entitlement to refunds with respect to Property
Costs relating to, certain of the Assets shall be adjusted as of Closing in the
manner described in Section 2.2).  For the
purpose of determining the amount of gathering fees to be included as income
under this Section 1.5(b) with respect to volumes of gas produced by any member
of the Company or any of its Affiliates, it shall be assumed that the Gathering
Agreement was effective as of the Effective Time.  Equitable shall be entitled to all income,
proceeds, receipts and credits earned with respect to the Assets prior to the
Effective Time, and shall be responsible for (and entitled to any refunds with
respect to) all Property Costs incurred prior to the Effective Time
(provided that Equitable’s entitlement to income, proceeds, receipts and
credits earned with respect to, and responsibility for and entitlement to
refunds with respect to Property Costs relating to, certain of the Assets shall
be adjusted as of Closing in the manner described in Section 2.2).  “Earned” and “incurred”, as used in this
Agreement, shall be interpreted in accordance with United States generally
accepted accounting principles (as published by the Financial Accounting
Standards Board).  Surface use fees,
insurance premiums and other Property Costs that are paid periodically shall be
prorated based on the number of days in the applicable period falling before
and at or after the Effective Time, except that production, severance and
similar Taxes based upon revenues generated by the Assets shall be prorated
based on the amount of revenues generated by the Assets before, or at and after  the Effective
Time.  In each case, the Company shall be
responsible for the portion allocated to the period on and after the Effective
Time and Equitable shall be responsible for the portion allocated to the period
before the Effective Time. 


(c)   “Property
Costs” means all operating expenses (including costs of insurance and ad
valorem, property and similar Taxes based upon or measured by the ownership or
operation of the Assets, but excluding any other Taxes), capital expenditures
incurred in the ownership and operation of the Assets in the ordinary course of
business, and overhead costs in each case as would have been charged to the
Assets under the limited liability company agreement of the Company assuming it
was in effect at all times during the period between the Effective Time and
Closing.


Section 1.6            Intentions
of the Parties.  The
Parties acknowledge that the description of the Gathering Assets comprising the
Nora Gas Gathering System (including the Nora-T Line) as provided on Exhibit
A-1 may be incomplete, including with respect to easements, servitudes,



 6
 









rights-of-way,
surface leases and other surface rights and the plat of such system, and the
Parties may amend Exhibit A-1 prior to the Closing Date in order to more fully
describe the Gathering Assets (it being acknowledged by the Parties that the
Gathering Assets are intended to cover all of Equitable’s and its Affiliates’
interests in and to their currently existing natural gas gathering system and
related assets, other than the Excluded Assets and as set forth in the
following sentence, located within the Nora Field including any currently
existing sections of the Nora Gas Gathering System extending beyond the Nora
Field that service wells in the Nora Field). 
Notwithstanding the foregoing, the Parties further acknowledge that the
Gathering Assets do not include any gas gathering system, facilities, compressors,
pipelines, pig and other stations, Easements, or other assets and interests of
EPC or EGEL in the separate gathering system commonly known as the Roaring Fork
Gas Gathering System located within and outside of the Nora Field, which system
is used as of the date hereof in connection with the transportation of
Hydrocarbons produced from the wells listed on Exhibit A-4, among other wells.


ARTICLE 2  

CASH CONTRIBUTION,
DISTRIBUTIONS AND LOANS


Section 2.1            Cash
Contribution.  On
the terms contained in this Agreement, PMOG agrees to contribute to the Company
at the Closing an amount of cash equal to Fifty-Three Million Sixty Five
Thousand One Hundred Seventy Six Dollars and Thirteen Cents (US$53,065,176.13)
(as adjusted pursuant to Section 3.4 and Section 3.5, the “Cash Contribution”),
to be applied as set forth in Section 2.3. 
Additionally, on the terms and conditions contained in this Agreement,
PMOG agrees to contribute to the Company and the Company agrees to accept from
PMOG, PMOG’s right, title and interest (if any) in and to the gas gathering
system, facilities, compressors and pipelines described on Exhibit A-1,
excluding any interest that PMOG owns in its capacity as the lessor under the
Original Lease or the New Lease or as Grantor under the New Easement
Agreement.  As consideration for the
contribution of such assets and the Cash Contribution, the Company shall issue
to PMOG a fifty percent (50%) membership interest in the Company.


Section 2.2            Effective
Time Adjustment.  


(a)   Not
later than five (5) Business Days prior to the Closing Date, Equitable shall
prepare in good faith, using the best information available to Equitable, and
deliver to PMOG a preliminary settlement statement setting forth an estimated
calculation of the net amount received (or paid) by Equitable for the account
of the Company pursuant to Section 1.5(b) (such net amount being called herein
the “Effective Time Adjustment.  Such
statement shall show the calculation of each adjustment, based, to the extent
possible, on actual credits, charges, receipts and other items attributable to
the period of time from and after the Effective Time and PMOG shall review such
preliminary settlement statement and discuss with Equitable any changes
necessary thereto.  The Parties shall use
their reasonable efforts exercised in good faith to agree upon such preliminary
settlement statement as of Closing.  An
amount equal to eighty percent (80%) of the estimated Effective Time
Adjustment, set forth in the preliminary settlement statement mutually agreed
to by the Parties in accordance with this Section 2.2(a), shall



 7
 









constitute the dollar amount to be contributed by PMOG to the Company
at the Closing (the “Closing Payment”), together with the Cash Contribution to
be contributed by PMOG at Closing.


(b)   As
soon as reasonably practicable after the Closing, but not later than the one
hundred and twentieth (120th) day following the Closing Date,
Equitable shall prepare in good faith, using the best information available to
Equitable, and deliver to PMOG a statement setting forth the final calculation
of the Effective Time Adjustment and showing the calculation of each
adjustment, based, to the extent possible, on actual credits, charges, receipts
and other items attributable to the period of time from and after the Effective
Time and shall supply reasonable documentation available to support any such
credits, charges, receipts or other items. 
As soon as reasonably practicable but not later than the thirtieth (30th) day following receipt of
Equitable’s statement hereunder, PMOG shall deliver to Equitable a written
report containing any changes that PMOG proposes be made to such
statement.  Equitable and PMOG shall
undertake to agree on the amount of the actual Effective Time Adjustment no
later than one hundred and eighty (180) days after the Closing Date.  In the event that such Parties cannot reach
agreement within such period of time, either Equitable or PMOG may refer the
remaining matters in dispute to Ernst & Young LLP, or if Ernst & Young
LLP is unable or unwilling to perform its obligations under this Section
2.2(b), such other nationally-recognized independent accounting firm as may be
accepted by Equitable and PMOG, for review and final determination.  The accounting firm shall conduct the
arbitration proceedings in Pittsburgh, Pennsylvania in accordance with the
Commercial Arbitration Rules of the American Arbitration Association in effect
as of the date hereof, to the extent such rules do not conflict with the terms
of this Section 2.2(b).  The accounting
firm’s determination shall be made within thirty (30) days after
submission of the matters in dispute and shall be final and binding on all
Parties, without right of appeal.  In
determining the proper amount of the Effective Time Adjustment, the accounting
firm shall not increase the Effective Time Adjustment more than the increase
proposed by Equitable nor decrease the Effective Time Adjustment more than the
decrease proposed by PMOG, as applicable. 
The accounting firm shall act as an expert for the limited purpose of
determining the specific disputed matters submitted by either Equitable or PMOG
and may not award damages or penalties. 
Equitable and PMOG shall each bear its own legal fees and other costs of
presenting its case.  Equitable and PMOG shall
bear one-half of the costs and expenses of the accounting firm.  Within ten (10) days after the earlier
of (i) the expiration of PMOG’s thirty (30) day review period without
delivery of any written report or (ii) the date on which the Equitable and
PMOG, or the accounting firm, as applicable, finally determine the actual
Effective Time Adjustment, (A) Equitable shall contribute to the Company
an amount of cash equal to the amount by which the estimated Effective Time
Adjustment exceeds the actual Effective Time Adjustment; or (B) PMOG shall
contribute to the Company an amount of cash equal to eighty percent (80%) of
the amount by which the actual Effective Time Adjustment exceeds the estimated
Effective Time Adjustment.



 8
 









(c)   The
adjustment described in Section 2.2(a) shall serve to satisfy up to the amount
of the adjustment (i) the Company’s entitlement under Section 1.5 to income,
proceeds, receipts and credits earned with respect to the Assets between the
Effective Time and the Closing (and the Company shall not have any separate
rights to receive any income, proceeds, receipts and credits with respect to
which an adjustment has been made) and (ii) the Company’s obligation under
Section 1.5 to pay Property Costs attributable to the ownership and operation
of the Assets which are incurred between the Effective Time and the Closing
(and the Company shall not be separately obligated to pay for any Property
Costs with respect to which an adjustment has been made).


Section 2.3            Cash
Distributions and Loans.  At
the Closing, the Company shall:


(a)   Distribute
an amount equal to twenty percent (20%) of the sum of Sixty-Six Million Three
Hundred Thirty One Thousand Four Hundred Seventy Dollars and Sixteen Cents
(US$66,331,470.16) and the Effective Time Adjustment to EGEL; and


(b)   Loan
the remaining amount of cash contributed to the Company hereunder  to ET Blue Grass
Company, with such loan to be entered by a separate note in substantially the
form attached hereto as Exhibit E, which loan shall be repaid prior to the
Company requiring any capital contribution by PMOG or Equitable under the LLC
Agreement.


Section 2.4            Capital
Account Balances.  Following
the completion of the contributions by Equitable and PMOG, the distribution to
EGEL pursuant to Section 2.3(a) and the other actions taken pursuant to Section
2.3, the respective capital account balances of EGEL and PMOG shall be equal.


ARTICLE 3

TITLE MATTERS


Section 3.1          Title.


(a)   The
Conveyance shall contain a special warranty of title against every Person
lawfully claiming or to claim the interest to be conveyed by Equitable to the
Company or any part thereof by, through and under Equitable and its Affiliates,
but not otherwise, subject to Permitted Encumbrances, but shall otherwise be
without warranty of title, express, implied or statutory, except that the
Conveyance shall transfer to the Company all rights or actions on title
warranties given or made by Equitable’s predecessors (other than Affiliates of
Equitable), to the extent Equitable may legally transfer such rights.


(b)   Notwithstanding
anything to the contrary in Section 3.1(a) and the Conveyance, Section 3.3
shall provide PMOG’s and the Company’s exclusive remedy in respect of Asserted
Title Defects reported in accordance with this Article 3.  Neither PMOG nor the Company shall be
entitled to make any claims against Equitable or any of its Affiliates under
Equitable’s special warranty of title in the Conveyance against any such
Asserted Title Defect.



 9
 









Section 3.2          Definitions
of Defensible Title and Permitted Encumbrances.


(a)   As
used in this Agreement with respect to the Assets, the term “Defensible Title”
means marketable title in southwestern Virginia, free and clear of all liens,
charges, encumbrances, irregularities or other defects (“Encumbrances”) other than
Permitted Encumbrances.  The term “Title
Defect” means, as applicable, (i) any Encumbrance that would cause Equitable
not to have Defensible Title or (ii) other than with respect to the lands
covered by the Original Lease or any Exploration Agreement PMOG Area, the lack
of easements or other agreements covering the continuous length of each
pipeline included in the Assets allowing for the transportation of the
Hydrocarbons as currently transported through such pipeline.  The term “Asserted Title Defect” means a
Title Defect reported by PMOG or the Company pursuant to Section 3.3 hereof. 


(b)   As
used in this Agreement, the term “Permitted Encumbrances” means any or all of
the following:


(i)            all
Contracts;


(ii)           Preferential
Rights;


(iii)          third-party
consent requirements and similar restrictions with respect to which waivers or
consents are obtained by Equitable from the appropriate parties prior to the
Closing Date or the appropriate time period for asserting the right has expired
or which are expressly not required to be satisfied prior to a transfer;


(iv)          liens
for current Taxes or assessments not yet delinquent or, if delinquent, being
contested in good faith by appropriate actions and listed on Exhibit A-5;


(v)           materialman’s,
mechanic’s, repairman’s, employee’s, contractor’s, operator’s and other similar
liens or charges arising in the ordinary course of business for amounts not yet
delinquent (including any amounts being withheld as provided by Law), or, if
delinquent, being contested in good faith by appropriate actions and listed on
Exhibit A-6;


(vi)          all
rights to consent, by required notices to, filings with, or other actions by
Governmental Authorities in connection with the sale or conveyance of
easements, rights of way, licenses, gathering facilities or interests therein
if they are customarily obtained subsequent to the sale or conveyance;


(vii)         rights
of reassignment arising upon final intention to abandon or release any easement
or right of way;


(viii)        with
regard to lands covered by the Original Lease or included in the Exploration
Agreement PMOG Area and to the extent not created by, through



 10
 









or under Equitable: easements, rights-of-way,
servitudes, permits and other rights in respect of surface and subsurface
operations and any rights related to coal, coal seams or coal mining, whether
statutory or otherwise, other than rights to explore for, develop and produce
coalbed methane;


(ix)           with
regard to lands not covered by the Original Lease or included in the
Exploration Agreement PMOG Area: easements, rights-of-way, servitudes, permits
and other rights in respect of surface and subsurface operations which would be
accepted by a reasonably prudent purchaser engaged in the business of owning
and operating assets similar to the Assets in the Appalachian Basin;


(x)            all
rights reserved to or vested in any Governmental Authority to control or
regulate any of the Assets in any manner and all obligations and duties under
all applicable Laws or under any franchise, grant, license or permit issued by
any such Governmental Authority;


(xi)           any
Encumbrance which is discharged by Equitable at or prior to Closing;


(xii)          with
respect to the easements, rights of way and other rights over, under or through
any lands and properties owned by PMOG or its Affiliates, any Encumbrance or
imperfection in title other than those Encumbrances or imperfections in title
arising by, through or under Equitable or its Affiliates; 


(xiii)         any
matters shown on Exhibit F; and


(xiv)        any
other Encumbrances which do not, individually or in the aggregate, materially
detract from the value of or materially interfere with the use, ownership or
operation of the Assets subject thereto or affected thereby (as currently used,
owned or operated) and which would be accepted by a reasonably prudent purchaser
engaged in the business of owning and operating gathering system or pipeline
assets in the Appalachian Basin.


Section 3.3          Notice of
Asserted Title Defects; Defect Adjustments.


(a)   To
assert a claim of a Title Defect prior to Closing, PMOG must deliver a claim
notice to Equitable on or before 5:00 p.m. EDT on April 25, 2007 (the “Title
Claim Date”), except as otherwise provided under Section 3.4 or Section 3.5;
provided that PMOG agrees to furnish Equitable at the end of every week period
following the execution of this Agreement and prior to the Title Claim Date
with a claim notice if any officer of PMOG or its Affiliates discovers or
learns of any Title Defect during such 
period.  Each such notice shall be
in writing and shall include (i) a description of the Asserted Title Defect(s),
(ii) the Assets affected, (iii) supporting documents reasonably necessary for
Equitable (as well as any title attorney or examiner hired by Equitable) to
verify the existence of such Asserted Title Defect(s) and (iv) the amount by
which PMOG reasonably believes the value of those Assets is reduced by such
Asserted Title



 11
 









Defect(s) and the computations and information upon which PMOG’s belief
is based.  Subject to the Company’s
rights under the special warranty of title described in Section 3.1(a) and its
and PMOG’s rights with respect to any breach of Equitable’s covenant under
Section 7.10(f), PMOG and the Company shall be deemed to have waived all Title
Defects of which Equitable has not been given notice on or before the Title
Claim Date.  


(b)   In
the event that PMOG notifies Equitable of a Title Defect before the Title Claim
Date, Equitable shall have the right, but not the obligation, to attempt, at
its sole cost, to cure or remove any Asserted Title Defects of which it has
been notified by PMOG.  If Equitable so
elects to cure or remove any Asserted Title Defect, PMOG shall use commercially
reasonable efforts to cooperate with Equitable’s efforts to cure or remove such
Asserted Title Defect.  If prior to
Closing, Equitable has been unable to cure or remove any Asserted Title Defect,
then Equitable and PMOG mutually shall elect to have one of the following
options apply:


(i)            Remove
the Assets subject to such Asserted Title Defect from the transaction
contemplated by this Agreement, if the operation of Gathering Assets (taken as
a whole) would not be materially impaired thereby.  Such removed Assets shall not be assigned at
the Closing, shall become “Excluded Assets” for all purposes hereunder and the
Cash Contribution shall be reduced by an amount equal to the value for such
Assets.


(ii)           Assign
the Assets subject to the Asserted Title Defect to the Company at Closing, and
defend, indemnify and hold the Company, the successors, assigns and Affiliates
of the Company, PMOG and PMOG’s Affiliates harmless from and against all
Damages that arise out of or that any such Person may suffer as a result of
such Asserted Title Defect pursuant to a form of indemnity agreement mutually
agreeable to the Parties.


(iii)          Assign
the Assets subject to the Asserted Title Defect to the Company at Closing, and
reduce the Cash Contribution in accordance with Section 3.3(c).


(c)   The
Cash Contribution shall be reduced by an amount (the “Asserted Title Defect
Amount”) equal to the reduction in the value for the Assets subject to an
uncured Asserted Title Defect, which reduction is caused by such uncured
Asserted Title Defect as determined pursuant to Section 3.3(e); provided that
no reduction shall be made in the Cash Contribution with respect to any
Asserted Title Defect for which an election has been made pursuant to Section
3.3(b)(ii).


(d)   Except
for the Company’s rights under the special warranty of title described in
Section 3.1(a) and its and PMOG’s rights with respect to any breach of
Equitable’s covenant under Section 7.10(f), Section 3.3(c) shall, to the
fullest extent permitted by applicable Laws, be the exclusive right and remedy
of PMOG and the Company against Equitable or its Affiliates with respect to any
Title Defect attributable to the Assets.



 12
 









(e)   The
Asserted Title Defect Amount resulting from an Asserted Title Defect shall be
determined as follows:


(i)            If
PMOG and Equitable agree on the Asserted Title Defect Amount, that amount shall
be the Asserted Title Defect Amount;


(ii)           If
the Asserted Title Defect is an Encumbrance which is undisputed and liquidated
in amount, then the Asserted Title Defect Amount shall be the amount necessary
to be paid to remove the Asserted Title Defect from the affected Assets;


(iii)          If
the Asserted Title Defect represents an Encumbrance of a type not described in
subsections (i) or (ii) above, the Asserted Title Defect Amount shall be
determined by taking into account the value of the Assets so affected, the
portion of the Assets affected by the Asserted Title Defect, the legal effect
of the Asserted Title Defect, the potential economic effect of the Asserted
Title Defect over the life of the affected Assets, the values placed upon the
Asserted Title Defect by PMOG and Equitable and such other factors as are necessary
to make a proper evaluation;


(iv)          Notwithstanding anything to the contrary in this Article 3,
except for adjustments required by Section 3.4 or Section 3.5, there shall be
no Cash Contribution adjustment for Asserted Title Defects unless and until the
aggregate Asserted Title Defect Amounts for all Assets for which claim notices
were timely delivered pursuant to Section 3.3(a) exceed Three Hundred Fifty
Thousand Dollars (US$350,000.00), and then only to the extent that the
aggregate Asserted Title Defect Amounts exceed Three Hundred Fifty Thousand
Dollars (US$350,000.00); 


(v)           If
an Asserted Title Defect of the type not described in subsections (i) or (ii)
above is reasonably susceptible of being cured, the Asserted Title Defect
Amount determined under subsections (iii) above shall not be greater than the
lesser of (1) the reasonable cost and expense of curing such Asserted
Title Defect or (2) the share of such curative work cost and expense which
is allocated to such Assets pursuant to subsection (vi) below; and 


(vi)          The
Asserted Title Defect Amount with respect to an Asset shall be determined
without duplication of any costs or losses (A) included in another
Asserted Title Defect Amount hereunder or (B) included in a casualty loss
under Section 3.5.  To the extent that
the cost to cure any Asserted Title Defect will result in the curing of all or
a part of one or more other Asserted Title Defects, such cost of cure shall be
allocated for purposes of Section 3.3(e)(v) among the Assets so affected
on a fair and reasonable basis.



 13
 









(f)    Equitable
and PMOG shall attempt to agree on all Asserted Title Defects and Asserted
Title Defect Amounts by two (2) Business Days prior to the Closing Date.  If Equitable and PMOG are unable to agree by
that date, the average of Equitable’s and PMOG’s estimates with respect to the
Asserted Title Defect Amounts for the Asserted Title Defects shall be used to
determine the Effective Time Adjustment pursuant to Section 2.2, and all
Asserted Title Defects and Asserted Title Defect Amounts in dispute shall be
exclusively and finally resolved by arbitration pursuant to this Section
3.3(f).  During the ten (10) Business Day
period following the Closing Date, Asserted Title Defects and Asserted Title
Defect Amounts in dispute shall be submitted to an attorney with at least ten
(10) years of experience in oil and gas and pipeline titles in the southwestern
Virginia as selected by mutual agreement of PMOG and Equitable (the “Title
Arbitrator”).  The arbitration proceeding
shall be held in Pittsburgh, Pennsylvania and shall be conducted in accordance
with the Commercial Arbitration Rules of the American Arbitration Association
in effect as of the date hereof, to the extent such rules do not conflict with
the terms of this Section 3.3(f).  The
Title Arbitrator’s determination shall be made within twenty (20) days after
submission of the matters in dispute and shall be final and binding upon the
Parties, without right of appeal.  In
making his determination, the Title Arbitrator shall be bound by the rules set
forth in Section 3.3(e) and may consider such other matters as in the opinion
of the Title Arbitrator are necessary or helpful to make a proper
determination.  Additionally, with the
prior written consent of PMOG and Equitable, the Title Arbitrator may consult
with and engage disinterested third parties to advise the Title Arbitrator,
including title attorneys from other states and petroleum engineers.  In no event shall any Asserted Title Defect
Amount exceed the estimate given by PMOG in its claim notice delivered in
accordance with Section 3.3(a).  The
Title Arbitrator shall act as an expert for the limited purpose of determining
the specific disputed Asserted Title Defects and Asserted Title Defect Amounts
submitted by either PMOG or Equitable and may not award damages, interest or
penalties to either PMOG or Equitable with respect to any matter.  Equitable and PMOG shall each bear its own
legal fees and other costs of presenting its case.  Each of Equitable and PMOG shall bear one-half
of the costs and expenses of the Title Arbitrator.


Section 3.4            Consents
to Assignment and Preferential Rights to Purchase.  


(a)   Equitable
will use reasonable efforts, consistent with industry practices in transactions
of this type, to identify, with respect to all Assets, the names and addresses
of all parties holding Preferential Rights and Consents applicable to the
transactions contemplated hereby.  In
attempting to identify the names and addresses of such parties holding such
Preferential Rights and Consents, Equitable shall in no event be obligated to
go beyond its own records.  Equitable
will request, from the parties so identified (and from any parties identified
by PMOG prior to Closing who have Preferential Rights or from whom a Consent
may be required), in accordance with the documents creating such rights,
execution of waivers of Preferential Rights or Consents so identified.  Equitable shall have no obligation other than
to identify such Preferential Rights and Consents and to so request such
execution of waivers of Preferential Rights and Consents (including,



 14
 









without limitation, Equitable shall have no obligation to assure that
such waivers of Preferential Rights and Consents are obtained).  


(b)   With
respect to Preferential Rights but not Consents, if a Person from whom a waiver
of a Preferential Right is requested refuses to give such waiver prior to
Closing, the interest in the Asset subject to such Preferential Right will be
excluded from the transaction contemplated hereby, such interest in such Asset
will become an “Excluded Asset” for all purposes hereunder (except in the case
of any subsequent transfer of such interest in such Asset to PMOG pursuant to
the following sentence) and the Cash Contribution will be adjusted downward by
the value (proportionately reduced to the excluded interest) for such interest
in such Asset.  If within ninety (90)
days following Closing, such holder does waive its Preferential Right, then
PMOG agrees that, within five (5) days following Equitable’s notice thereof,
the Parties hereto will conduct a subsequent Closing (in accordance with same
terms hereof) for the purchase and sale of such Excluded Asset.


(c)   If
(i) an Asset is subject to a Consent that prohibits the transfer of such Asset
without compliance with the provisions of such Consent, (ii) the failure to
comply with or obtain such Consent will result in a termination or other
material impairment of any rights in relation to such Asset, (iii) such Consent
is not obtained or complied with prior to the Closing and (iv) the absence of
such Asset would not materially impair the operations of the Gathering Assets
(taken as a whole), then unless otherwise agreed to by PMOG and Equitable, the
Asset or portion thereof affected by such Consent will be excluded from the
transactions contemplated hereby, such Asset will become an “Excluded Asset”
for all purposes hereunder (except in the case of any subsequent transfer of
such Asset to PMOG pursuant to the following sentence), and the Cash
Contribution will be adjusted downward by the agreed upon value for such
Asset.  If within ninety (90) days  following
Closing such Consent is obtained or otherwise complied with, then PMOG agrees
that, within five (5) days following Equitable’s notice thereof, the Parties
hereto will conduct a subsequent Closing (in accordance with the same terms
hereof) for the purchase and sale of such excluded Asset.


(d)   To
the extent that the consent of PMOG with respect to the assignment of the
Assets contemplated hereby is required under any agreement or arrangement, as
of the Closing, PMOG hereby irrevocably grants such consent.


Section 3.5            Casualty
or Condemnation Loss.  Subject
to the provisions of Section 8.1(e) and Section 8.2(f) hereof, if, after the
date of this Agreement but prior to the Closing Date, any portion of the Assets
is destroyed by fire or other casualty or is taken in condemnation or under
right of eminent domain, PMOG and the Company shall nevertheless be required to
close and the Parties mutually shall elect prior to Closing one of the
following options: (i) to have Equitable cause the Assets affected by any
casualty to be repaired or restored, at Equitable’s sole cost, as promptly as
reasonably practicable (which work may extend after the Closing Date),
(ii) to have Equitable indemnify the Company, PMOG, and their respective
Affiliates through a document reasonably acceptable to Equitable and PMOG
against any costs or expenses that such



 15
 









Person reasonably
incurs to repair the Assets subject to any casualty or (iii) to treat such
casualty or taking as an Asserted Title Defect with respect to the affected
Assets under Section 3.3; provided that in no event shall such Asserted Title
Defect be subject to the provisions of Section 3.3(e)(iv) hereof.  In each case, Equitable shall retain all
rights to insurance and other claims against third parties with respect to the
casualty or taking except to the extent Equitable and PMOG otherwise agree in
writing.


ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF EQUITABLE


Section 4.1          Disclaimers.


(a)   Except
as expressly set forth in Article 3, Article 4, Article 6, in the certificates
delivered by Equitable at Closing pursuant to Section 9.2(b) and Section 9.2(c)
or in the Conveyance, (i) Equitable makes no representations or warranties,
express or implied, with respect to the Assets or the transactions contemplated
hereby and (ii) Equitable expressly disclaims all liability and responsibility
for any representation, warranty, statement or information with respect to the
Assets or the transactions contemplated hereby made or communicated (orally or
in writing) to PMOG or any of its Affiliates, employees, agents, consultants or
representatives (including any opinion, information, projection or advice that
may have been provided to PMOG by any officer, director, employee, agent,
consultant, representative or advisor of Equitable or any of its Affiliates).


(b)   EXCEPT
AS EXPRESSLY REPRESENTED OTHERWISE IN ARTICLE 3, ARTICLE 4, ARTICLE
6, IN THE CERTIFICATES DELIVERED BY EQUITABLE AT CLOSING PURSUANT TO SECTIONS
9.2(b) AND 9.2(c) OR IN THE CONVEYANCE, WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, EQUITABLE EXPRESSLY DISCLAIMS ANY REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, AS TO (I) TITLE TO ANY OF THE ASSETS, (II) ANY
ESTIMATES OF THE VALUE OF THE ASSETS OR FUTURE REVENUES GENERATED BY THE
ASSETS, (III) THE MAINTENANCE, REPAIR, CONDITION, QUALITY, SUITABILITY,
DESIGN OR MARKETABILITY OF THE ASSETS, OR (IV) ANY OTHER MATERIALS OR
INFORMATION THAT MAY HAVE BEEN MADE AVAILABLE OR COMMUNICATED TO PMOG OR THE
COMPANY OR THEIR RESPECTIVE AFFILIATES, OR THEIR RESPECTIVE EMPLOYEES, AGENTS,
CONSULTANTS, REPRESENTATIVES OR ADVISORS IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR ANY DISCUSSION OR PRESENTATION RELATING
THERETO, AND FURTHER DISCLAIMS ANY REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR CONFORMITY TO
MODELS OR SAMPLES OF MATERIALS OF ANY EQUIPMENT, IT BEING EXPRESSLY UNDERSTOOD
AND AGREED BY THE PARTIES HERETO THAT, SUBJECT TO THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN ARTICLE 3, ARTICLE 4,



 16
 









ARTICLE 6, IN THE CERTIFICATES DELIVERED BY EQUITABLE AT CLOSING
PURSUANT TO SECTIONS 9.2(b) AND 9.2(c) AND IN THE CONVEYANCE, PMOG AND THE
COMPANY HAVE MADE OR CAUSED TO BE MADE SUCH INSPECTIONS AS PMOG AND THE COMPANY
DEEM APPROPRIATE, THE COMPANY IS RECEIVING THE ASSETS, EQUIPMENT AND ALL OTHER
TANGIBLE PROPERTY IN ITS PRESENT STATUS, CONDITION AND STATE OF REPAIR, “AS IS”
AND “WHERE IS” WITH ALL FAULTS.


(c)   Any
representation “to the knowledge of Equitable” or “to Equitable’s knowledge” is
limited to matters within the actual conscious awareness of Ted O’Brien, Lester
Zitkus, Andy Murphy, Shawn Posey, John Centofanti, Chris Akers, Matt Ankrum and
Phil Elliott.


(d)   Inclusion
of a matter on a schedule attached hereto with respect to a representation or
warranty that addresses matters having a Material Adverse Effect shall not be
deemed an indication that such matter does, or may, have a Material Adverse
Effect.  Matters may be disclosed on a
schedule for purposes of information only. 
As used herein, “Material Adverse Effect” means any change, inaccuracy,
circumstance, event, result, occurrence, condition or an act (each, an “Event”)
that has had or could reasonably be expected to have a material adverse effect
on the ownership, operation or value of the Assets, taken as a whole or the
ability of Equitable or PMOG, as applicable, to consummate the transactions
contemplated hereby or meet its obligations under this Agreement and the
documents to be executed hereunder; provided, however, that “Material Adverse
Effect” shall not include Events resulting from general changes in Hydrocarbon
prices; general changes in the Hydrocarbon exploration and production industry
or general economic or political conditions; civil unrest, insurrection or
similar disorders; or changes in Laws.


(e)   Subject
to the foregoing provisions of this Section 4.1 and the other terms and
conditions of this Agreement, Equitable represents and warrants to PMOG and the
Company the matters set out in the remainder of this  Article 4.


Section 4.2          EPC.


(a)   Existence and Qualification.  EPC is a corporation duly organized, validly
existing and in good standing under the laws of the Commonwealth of
Pennsylvania and is duly qualified to do business as a foreign corporation in
the Commonwealth of Virginia.


(b)   Power.  EPC has the corporate power to enter into and
perform this Agreement (and all documents required to be executed and delivered
by EPC at Closing) and to consummate the transactions contemplated by this
Agreement (and such documents).



 17
 









(c)   Authorization and Enforceability.  The execution, delivery and performance of
this Agreement by EPC (and all documents required to be executed and delivered
by EPC at Closing) and the consummation of the transactions contemplated
hereby and thereby, have been duly and validly authorized by all necessary
corporate action on the part of EPC. 
This Agreement has been duly executed and delivered by EPC (and all
documents required to be executed and delivered by EPC at Closing shall be duly
executed and delivered by EPC) and this Agreement constitutes (and at the
Closing such documents shall constitute) the valid and binding obligations of
EPC, enforceable in accordance with their terms except as such enforceability
may be limited by applicable bankruptcy or other similar Laws affecting the
rights and remedies of creditors generally, as well as to general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at Law).


(d)   No Conflicts.  The execution, delivery and performance of
this Agreement by EPC (and all documents required to be executed and delivered
by EPC at Closing), and the consummation of the transactions contemplated by
this Agreement (and by such documents) shall not (i) violate any provision
of the certificate of incorporation or bylaws of EPC, (ii) result in
default (with due notice or lapse of time or both) or the creation of any
lien or encumbrance or give rise to any right of termination, cancellation or
acceleration under any note, bond, mortgage, indenture, license or agreement to
which EPC is a party or by which it is bound, (iii) violate any judgment,
order, ruling, or decree applicable to EPC as a party in interest, or
(iv) violate any Laws applicable to EPC or any of the Assets, except any
matters described in clauses (ii), (iii), or (iv) above which would not
have a Material Adverse Effect or as set forth on Schedule 4.2(d) and
except for compliance with the HSR Act.


Section 4.3          EGEL.


(a)   Existence and Qualification.  EGEL is a limited liability company duly
organized, and validly existing under the laws of the State of Delaware and is
duly qualified to do business as a foreign limited liability company in the
Commonwealth of Virginia.


(b)   Power.  EGEL has the limited liability company power
to enter into and perform this Agreement (and all documents required to be
executed and delivered by EGEL at Closing) and to consummate the
transactions contemplated by this Agreement (and such documents).


(c)   Authorization and Enforceability.  The execution, delivery and performance of
this Agreement by EGEL (and all documents required to be executed and delivered
by EGEL at Closing) and the consummation of the transactions contemplated
hereby and thereby, have been duly and validly authorized by all necessary
limited liability company action on the part of EGEL.  This Agreement has been duly executed and
delivered by EGEL (and all documents required to be executed and delivered by EGEL
at Closing shall be duly executed and delivered by EGEL) and this
Agreement constitutes (and at



 18
 









the Closing such documents shall constitute) the valid and binding
obligations of EGEL, enforceable in accordance with their terms except as such
enforceability may be limited by applicable bankruptcy or other similar Laws
affecting the rights and remedies of creditors generally, as well as to general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at Law).


(d)   No Conflicts.  The execution, delivery and performance of
this Agreement by EGEL (and all documents required to be executed and delivered
by EGEL at Closing), and the consummation of the transactions contemplated by
this Agreement (and by such documents) shall not (i) violate any provision
of the certificate of formation or limited liability company agreement of EGEL,
(ii) result in default (with due notice or lapse of time or both) or
the creation of any lien or encumbrance or give rise to any right of
termination, cancellation or acceleration under any note, bond, mortgage,
indenture, license or agreement to which EGEL is a party or by which it is
bound, (iii) violate any judgment, order, ruling, or decree applicable to
EGEL as a party in interest, or (iv) violate any Laws applicable to EGEL
or any of the Assets, except any matters described in clauses (ii), (iii), or
(iv) above which would not have a Material Adverse Effect or as set forth
on Schedule 4.3(d) and except for compliance with the HSR Act.


Section 4.4            Liability
for Brokers’ Fees.  Neither
PMOG nor the Company shall directly or indirectly have any responsibility,
liability or expense, as a result of undertakings or agreements of Equitable or
its Affiliates, for brokerage fees, finder’s fees, agent’s commissions or other
similar forms of compensation to an intermediary in connection with the
negotiation, execution or delivery of this Agreement or any agreement or
transaction contemplated hereby.


Section 4.5            Consents,
Approvals or Waivers.  Except
(a) for preferential rights (collectively “Preferential Rights”) to purchase
and other provisions restricting assignment without consent (“Consents”) which
would be applicable to the transactions contemplated hereby that are set forth
on Schedule 4.5 (the “Scheduled Transfer Requirements”), (b) as would not,
individually or in the aggregate, have a Material Adverse Effect, (c) for
approvals customarily obtained from a Governmental Authority post-Closing, and
(d) for compliance with the HSR Act, neither the execution and delivery of this
Agreement (nor any documents required to be executed by Equitable at Closing),
nor the consummation of the transactions contemplated hereby nor thereby, nor
the compliance with the terms hereof nor thereof, (in each case) by Equitable
will (i) conflict with or result in a violation of any provision of, or
constitute (with or without the giving of notice or the passage of time or
both) a default under, or give rise to (with or without the giving of notice or
the passage of time or both) any right of termination, cancellation, or
acceleration under, any bond, debenture, note, mortgage or indenture, or any
lease, contract, agreement, or other instrument or obligation to which
Equitable is a party or by which Equitable or any of the Assets may be bound or
(ii) violate any applicable Law binding upon Equitable or the Assets.  Except (x) for the Scheduled Transfer
Requirements (y) for approvals customarily obtained from a Governmental
Authority post-Closing, and (z) for compliance with the HSR Act, the execution
of this Agreement by Equitable and the consummation of the transactions
contemplated hereby by Equitable will not require any



 19
 









material consent,
approval or waiver of any Governmental Authority or other third Person, or
create a right in favor of any Person to purchase all or any material part of
the Assets.


Section 4.6            Litigation.  Except as disclosed on
Schedule 4.6A or Schedule 4.6B and except for the Party Lawsuit,
there are no actions, suits or proceedings pending, or to Equitable’s
knowledge, threatened in writing, by or before any Governmental Authority or
arbitrator with respect to the Assets or Equitable’s or any of its Affiliates’
ownership, operation or use thereof.  To
Equitable’s knowledge, no written notice from any third Person (including any
Governmental Authority) claiming material Damages or any material breach of
duty of care has been received by Equitable or any of its Affiliates relating
to the Assets or Equitable’s or any of its Affiliate’s ownership, operation or
use thereof, except for the suits, actions and proceedings set forth in
Schedule 4.6A or Schedule 4.6B and the Party Lawsuit.


Section 4.7            Taxes.  Except as disclosed on
Schedule 4.7: (i) all material Tax Returns required to be filed with respect to
the Assets have been duly and timely filed; (ii) each such Tax Return is in all
material respects true, correct and complete; (iii) all material Taxes owed
with respect to the Assets have been timely paid in full; (iv) there are no
Encumbrances for Taxes on any of the Assets other than Permitted Encumbrances;
(v) there is no outstanding dispute or claim concerning any material Taxes with
respect to the Assets, and to Equitable’s knowledge no assessment, deficiency
or adjustment has been asserted or proposed with respect thereto; and (vi) to
Equitable’s knowledge, all of the Assets have been properly listed and
described on the property tax rolls for the taxing units in which such Assets
are located and no portion of the Assets constitutes omitted property for
property tax purposes.


Section 4.8            Environmental
Laws.  To Equitable’s
knowledge, Equitable and its Affiliates have complied in all respects with, and
the operation of the Assets has been in compliance in all respects with, all
applicable Laws relating to the environment (“Environmental Laws”), except such
failures to comply as, individually or in the aggregate, would not have a
Material Adverse Effect.  Except for
contamination that would not, individually or in the aggregate, have a Material
Adverse Effect, to Equitable’s knowledge there has been no contamination of
groundwater, surface water or soil resulting from activities relating to the
Assets, which requires remediation under applicable Environmental Laws.  


Section 4.9            Compliance
with Laws.  Except
with respect to Environmental Laws, which are addressed in Section 4.8, and
except as disclosed on Schedule 4.9, to Equitable’s knowledge, Equitable
and its Affiliates have complied in all respects with, and the Assets have been
operated and maintained in compliance in all respects with, all applicable
Laws, except such failures to comply as would not, individually or in the
aggregate, have a Material Adverse Effect. 



Section 4.10         Contracts.  Neither Equitable, nor to
the knowledge of Equitable, any other Person is in default under any Contract,
except as disclosed on Schedule 4.10 and except for such defaults as would
not, individually or in the aggregate, have a Material Adverse Effect.  Except as disclosed on Schedule 4.10, there
are (a) no gathering agreements with third Persons



 20
 









for Hydrocarbons
to be transported on the Gathering Assets or (b) material contracts or other
material agreements included in or directly related to the operation of or
title to the Assets.


Section 4.11         Permits,
etc..  To Equitable’s
knowledge, except as disclosed on Schedule 4.11, Equitable has obtained and is
maintaining all material federal, state and local governmental licenses,
permits, franchises, orders, exemptions, variances, waivers, authorizations,
certificates, consents, rights, privileges and applications therefor (the “Governmental
Permits”) that are presently necessary or required for the ownership and
operation of the Assets as currently owned and operated. To Equitable’s
knowledge, except as disclosed in Schedule 4.11, (a) the Assets have been
operated in all material respects in accordance with the conditions and
provisions of such Governmental Permits, and (b) no written notices of material
violation of such Governmental Permits have been received by Equitable or its
Affiliates.  


Section 4.12         Outstanding
Capital Commitments.  As
of the date hereof, Equitable has made no commitments to third Persons to make
capital expenditures which are binding on the Assets or the owner thereof and
which Equitable reasonably anticipates will individually require expenditures
by the owner of the Assets after the Effective Time other than those reflected
in the capital budget included as Schedule 4.12.


Section 4.13         Abandonment.  Since the Effective Time
through the date of this Agreement, Equitable has not abandoned, and is not in
the process of abandoning, any physical Assets (nor has it removed, nor is it
in the process of removing, any material items of personal property located
upon the Assets, except those replaced by items of substantially equivalent
suitability and value).  Except as set
forth in Schedule 4.13 or as otherwise would not have a Material Adverse
Effect, there are no pipelines or gathering facilities located on the real
property included in the Assets that Equitable is currently required by Law or
by Contract to remove or abandon.


Section 4.14       Condition of
Equipment, etc. 
Except as set forth in Schedule 4.14, to the knowledge of Equitable, all
pipelines, fixtures, facilities and equipment included in the Assets have been
maintained in all material respects in a state of adequate repair consistent
with industry standards in the Appalachian Basin and are otherwise generally
adequate for the normal operation thereof. 



Section 4.15       Payments of
Property Costs.  All
Property Costs and other payments due in connection with the ownership and
operation of the Assets have been properly and correctly paid for in all
material respects by Equitable.  


Section 4.16       Absence of
Certain Events.  Except
as disclosed on Schedule 4.16 or as contemplated by this Agreement, since the
Effective Time, there has not been any damage, destruction or loss, whether
covered by insurance or not, with respect to the Assets that has had or is
reasonably likely to have a Material Adverse Effect.


Section 4.17       Regulatory
Matters.  To
Equitable’s knowledge, no consent is required in connection with the
transaction contemplated hereby under the Natural Gas Policy Act of 1978,



 21
 









as amended for
which the failure to obtain such consent would be reasonably expected to have a
Material Adverse Effect.  Equitable is
not and the Company will not be a natural gas company within the jurisdiction
of the Natural Gas Act of 1938 (assuming that the fact that PMOG will be a
member of the Company will not cause the Company to be a natural gas company
within the jurisdiction of the Natural Gas Act of 1938).


Section 4.18       Information.  To Equitable’s
knowledge, Equitable has complied in all material respects with PMOG’s  requests for supporting documentation and information
relating to the transactions contemplated by this Agreement to the extent
Equitable has such documentation or information in Equitable’s or its
Affiliates’ possession or control.


Section 4.19       Sole Member.  EGEL is the sole
member of the Company prior to the issuance of membership interests therein to
PMOG and EGEL pursuant to the terms hereof. 
The Company currently has no assets or liabilities.


ARTICLE 5  

REPRESENTATIONS AND WARRANTIES OF PMOG


PMOG
represents and warrants to Equitable and the Company the following:


Section 5.1          Existence
and Qualification.  PMOG
is a corporation organized, validly existing and in good standing under the
Laws of the Commonwealth of Virginia.


Section 5.2          Power.  PMOG has the
corporate power to enter into and perform this Agreement (and all documents
required to be executed and delivered by PMOG at Closing) and to
consummate the transactions contemplated by this Agreement (and such
documents).


Section 5.3          Authorization
and Enforceability.  The
execution, delivery and performance of this Agreement by PMOG (and all
documents required to be executed and delivered by PMOG at Closing), and the
consummation of the transactions contemplated hereby and thereby, have been
duly and validly authorized by all necessary corporate action on the part of
PMOG.  This Agreement has been duly
executed and delivered by PMOG (and all documents required to be executed and
delivered by PMOG at Closing will be duly executed and delivered by
PMOG) and this Agreement constitutes (and at the Closing such documents
will constitute) the valid and binding obligations of PMOG, enforceable in
accordance with their terms except as such enforceability may be limited by
applicable bankruptcy or other similar Laws affecting the rights and remedies
of creditors generally, as well as to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at
Law).


Section 5.4          No
Conflicts.  The
execution, delivery and performance of this Agreement by PMOG (and all documents
required to be executed and delivered by PMOG at Closing), and the consummation
of the transactions contemplated by this Agreement (and by such documents) will
not (a) violate any provision of the certificate of incorporation or
bylaws of PMOG, (b) result in a default (with due notice or lapse of time
or both) or the creation of any lien or encumbrance or give rise to any
right of termination, cancellation or acceleration under any note, bond,
mortgage, indenture, license or agreement to which PMOG is a party or by which
it is



 22
 









bound,
(c) violate any judgment, order, ruling, or regulation applicable to PMOG
as a party in interest, or (d) violate any Law applicable to PMOG or any
of its assets, except any matters described in clauses (b), (c) or (d) above
which would not have a material adverse effect on PMOG’s ability to consummate
the transactions contemplated hereby and except for compliance with the HSR
Act.


Section 5.5          Liability
for Brokers’ Fees.  Neither
Equitable nor the Company shall directly or indirectly have any responsibility,
liability or expense, as a result of undertakings or agreements of PMOG or its
Affiliates, for brokerage fees, finder’s fees, agent’s commissions or other
similar forms of compensation to an intermediary in connection with the
negotiation, execution or delivery of this Agreement or any agreement or
transaction contemplated hereby.


Section 5.6          Consents,
Approvals or Waivers.  Except
for compliance with the HSR Act, neither the execution and delivery of this
Agreement (nor any documents required to be executed by PMOG at Closing), nor
the consummation of the transactions contemplated hereby nor thereby, nor the
compliance with the terms hereof nor thereof (in each case, by PMOG), will (a)
be subject to obtaining any consent, approval, or waiver from any Governmental
Authority or other third Person, or (b) except as would not, individually or in
the aggregate, have a material adverse effect on PMOG’s ability to consummate
the transactions contemplated hereby, violate any applicable Law binding upon
PMOG.


Section 5.7          Litigation.  Except for the Party
Lawsuit, there are no actions, suits or proceedings pending, or to PMOG’s
knowledge, threatened in writing by or before any Governmental Authority or
arbitrator against PMOG which are reasonably likely to impair PMOG’s ability to
consummate the transactions contemplated hereby.


Section 5.8          Financing.  PMOG has sufficient
cash, available lines of credit or other sources of immediately available funds
(in United States dollars) to enable it to pay the Cash Contribution to
the Company at the Closing. 


Section 5.9          Independent
Investigation.  Subject
to Equitable’s and the Company’s representations and warranties set forth in
Article 3, Article 4 and Article 6 hereof (or in any certificate furnished or
to be furnished by PMOG or the Company pursuant to this Agreement) and in the
Conveyance, PMOG acknowledges and affirms that it has made (or will make prior
to Closing) all such reviews and inspections of the Assets as PMOG has deemed necessary
or appropriate.  Except for the
representations and warranties expressly made by Equitable or the Company in
Articles 3, Article 4 and Article 6 of this Agreement (or in any certificate
furnished or to be furnished to PMOG or the Company pursuant to this Agreement)
and in the Conveyance, PMOG acknowledges that there are no representations or
warranties, express or implied, as to the Assets or prospects thereof, and that
in making its decision to enter into this Agreement and to consummate the transactions
contemplated hereby, PMOG has relied solely upon its own independent
investigation, verification, analysis and evaluation. 


Section 5.10       Equitable
Information.  To
the knowledge of the officers of PMOG, as of the execution date of this
Agreement, Equitable has complied in all material respects with



 23
 









PMOG’s
requests for supporting documentation and information relating to the
transactions contemplated by this Agreement.


ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF THE COMPANY


The
Company represents and warrants to PMOG the following:


Section 6.1          Existence
and Qualification.  The
Company is a limited liability company organized and validly existing under the
Laws of the State of Delaware; and the Company is duly qualified to do business
as a foreign corporation in the Commonwealth of Virginia.


Section 6.2          Valid
Issuance.  The
offer and sale of the membership interests in the Company to EGEL and PMOG has
been duly authorized by the Company and, when issued and delivered to EGEL and
PMOG in accordance with the terms of this Agreement, will be validly issued in
accordance with the limited liability company agreement of the Company, fully
paid (to the extent required under the limited liability company agreement of
the Company) and nonassessable, will not be subject to preemptive or similar
rights and will be free of any and all liens other than any arising under
applicable state and federal securities Laws.


Section 6.3          Power.  The Company has the
limited liability company power to enter into and perform this Agreement (and
all documents required to be executed and delivered by the Company at
Closing) and to consummate the transactions contemplated by this Agreement
(and such documents).


Section 6.4          Authorization
and Enforceability.  The
execution, delivery and performance of this Agreement by the Company (and all
documents required to be executed and delivered by the Company at Closing), and
the consummation of the transactions contemplated hereby and thereby, have been
duly and validly authorized by all necessary limited liability company action
on the part of the Company.  This
Agreement has been duly executed and delivered by the Company (and all
documents required to be executed and delivered by the Company at Closing will
be duly executed and delivered by the Company) and this Agreement
constitutes (and at the Closing such documents will constitute) the valid and
binding obligations of the Company, enforceable in accordance with their terms
except as such enforceability may be limited by applicable bankruptcy or other
similar Laws affecting the rights and remedies of creditors generally, as well
as to general principles of equity (regardless of whether such enforceability
is considered in a proceeding in equity or at Law).


Section 6.5          No
Conflicts.  The
execution, delivery and performance of this Agreement by the Company (and all
documents required to be executed and delivered by the Company at Closing), and
the consummation of the transactions contemplated by this Agreement (and by
such documents) will not (a) violate any provision of the certificate of
formation or limited liability company agreement of the Company,
(b) result in a default (with due notice or lapse of time or both) or
the creation of any lien or encumbrance or give rise to any right of termination,
cancellation or acceleration under any note, bond, mortgage, indenture, license
or agreement to



 24
 









which the
Company is a party or by which it is bound, (c) violate any judgment,
order, ruling, or regulation applicable to PMOG as a party in interest, or
(d) violate any Law applicable to the Company or any of its assets, except
any matters described in clauses (b), (c) or (d) above which would
not have a material adverse effect on the Company’s ability to consummate the
transactions contemplated hereby and except for compliance with the HSR Act.


Section 6.6          Consents,
Approvals or Waivers.  Except
for compliance with the HSR Act, neither the execution and delivery of this
Agreement (nor any documents required to be executed by the Company at
Closing), nor the consummation of the transactions contemplated hereby nor
thereby, nor the compliance with the terms hereof nor thereof (in each case, by
the Company), will (a) be subject to obtaining any consent, approval, or waiver
from any Governmental Authority or other third Person, or (b) except as would
not, individually or in the aggregate, have a material adverse effect on the
Company’s ability to consummate the transactions contemplated hereby, violate
any applicable Law binding upon the Company.


Section 6.7          Litigation.  There are no
actions, suits or proceedings pending, or to the Company’s knowledge,
threatened in writing by or before any Governmental Authority or arbitrator
against the Company which are reasonably likely to impair the Company’s ability
to consummate the transactions contemplated hereby.


ARTICLE 7

COVENANTS OF THE PARTIES


Section 7.1          Access.  Equitable will give
PMOG and its representatives access to the Assets and access to and the right
to copy, at PMOG’s expense, the Records in Equitable’s possession, for the
purpose of conducting an investigation of the Assets and the Company, but only
to the extent that Equitable may do so without violating any obligations to any
third Person; provided that Equitable shall use its commercially reasonable efforts
to obtain all consents and waivers from such third Persons if necessary to
permit PMOG’s access to the Assets and Records. 
Such access by PMOG shall be limited to Equitable’s normal business
hours, and PMOG’s investigation shall be conducted in a manner that minimizes
interference with the operation of the Assets. 
PMOG at its option may conduct a Phase I environmental audit of any or
all of the Assets, to the extent Equitable has authority to permit such an audit,
provided that neither PMOG nor its representatives shall conduct any testing or
sampling on or with respect to the Assets prior to Closing.


Section 7.2          Indemnity
Regarding Access.  PMOG
agrees to indemnify, defend and hold harmless Equitable, its Affiliates, the
other owners of interests in the Assets (other than PMOG or its Affiliates),
and all such Persons’ directors, officers, employees, agents and
representatives from and against any and all Damages directly attributable to
access to the Assets prior to the Closing by PMOG, its Affiliates, or its or
their directors, officers, employees, agents or representatives in connection
with PMOG’s due diligence activities with respect to the transactions
contemplated hereby, even if caused in whole or
in part by the negligence (whether sole, joint or concurrent), strict liability
or other legal fault of any Indemnified



 25















Person
but excluding any Damages to the extent caused by the gross negligence or
willful misconduct of any Indemnified Person.


Section 7.3            Pre-Closing
Notifications.  Until
the Closing,


(a)   PMOG
shall notify Equitable promptly after any officer of PMOG obtains actual
knowledge that (i) any representation or warranty of Equitable contained in
this Agreement is untrue in any material respect or will be untrue in any
material respect as of the Closing Date or (ii) any covenant or agreement to be
performed or observed by Equitable prior to or on the Closing Date has not been
so performed or observed in any material respect.


(b)   Equitable
shall notify PMOG promptly after any officer of Equitable obtains actual
knowledge that (i) any representation or warranty of PMOG contained in this
Agreement is untrue in any material respect or will be untrue in any material
respect as of the Closing Date or (ii) any covenant or agreement to be
performed or observed by PMOG prior to or on the Closing Date has not been so
performed or observed in a material respect.


If any of PMOG’s
or Equitable’s representations or warranties are untrue or shall become untrue
in any material respect between the date of execution of this Agreement and the
Closing Date, or if any of PMOG’s or Equitable’s covenants or agreements to be
performed or observed prior to or on the Closing Date shall not have been so
performed or observed in any material respect, but if such breach of
representation, warranty, covenant or agreement shall (if curable) be cured
by the Closing and no non-breaching Party has terminated this Agreement
pursuant to Section 10.1, then such breach shall be considered not to have
occurred for all purposes of this Agreement; 
provided that any costs or expenses arising out of or relating to such
cure shall be borne solely by the Party who committed the breach
(notwithstanding anything to the contrary herein, including the adjustments set
forth in Section 2.2).


Section 7.4            Confidentiality,
Public Announcements.  Until
the Closing, the Parties shall keep confidential and cause their Affiliates and
their respective officers, directors, employees and representatives to keep
confidential all information relating to this Agreement and the Assets, except
as required by applicable Laws, administrative process or the applicable rules
of any stock exchange to which such Party or its Affiliates are subject, and
except for information which is available to the public on the date hereof or
thereafter becomes available to the public other than as a result of a breach
of this Section 7.4 by such Party or any such other Person.  Until the Closing, no Party shall make any
press release or other public announcement regarding the existence of this
Agreement (or any documents contemplated by this Agreement), the contents
hereof or thereof or the transactions contemplated hereby or thereby without
the prior written consent of the other Parties; provided, however, the
foregoing shall not restrict disclosures by any Party (a) that are agreed
to in writing by Equitable and PMOG, (b) that are required by applicable
securities or other Laws or the applicable rules of any stock exchange having
jurisdiction over the disclosing Party or its Affiliates, or (c) to
Governmental Authorities and third Persons holding Preferential Rights or
Consents that may be applicable to the



 26
 









transactions
contemplated by this Agreement (or any documents contemplated by this
Agreement), as reasonably necessary to obtain waivers of such rights or such
consents.  The Parties agree to negotiate
a reasonable and customary post-Closing press release. Notwithstanding the
foregoing, at no time (before or after the Closing) shall either Party or its
Affiliates disclose to third Persons the specific development plans for the
Company’s operations, except (i) with the prior written consent of the other
Party, (ii) to suppliers and other Persons bound by similar confidentiality
provisions as is reasonably necessary to conduct operations of the Company,
(iii) that are required by applicable securities or other Laws or the
applicable rules of any stock exchange having jurisdiction over the disclosing
Party or its Affiliates, (iv) as is reasonably necessary to Governmental
Authorities, (v) to prospective purchasers bound by similar confidentiality provisions,
(vi) to the disclosing Party’s Affiliates and such Party’s representatives
bound by similar confidentiality provisions or (vii) to the disclosing Party’s
lenders or financials advisors, or (viii) information which is available to the
public on the date hereof or thereafter becomes available to the public other
than as a result of a breach of this Section 7.4 by such Party or any such
other Person; provided that the disclosing Party shall be responsible for any
breach by the parties listed under subsections (ii), (v) (vi) or (vii) above of
the confidentiality provisions set forth in this sentence.


Section 7.5            Governmental
Reviews.  Equitable,
PMOG and the Company shall each in a timely manner (a) make all required
filings, including filings under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended (the “HSR Act”), and prepare applications to and
conduct negotiations, with each Governmental Authority as to which such
filings, applications or negotiations are necessary or appropriate in the consummation
of the transactions contemplated hereby, and (b) provide such information
as any other may reasonably request in order to make such filings, prepare such
applications and conduct such negotiations. 
Each Party shall cooperate with and use all reasonable efforts to assist
the other with respect to such filings, applications and negotiations.  Equitable shall pay all filing costs required
by the HSR Act, in connection with the transactions contemplated hereby,
including the attorneys’ fees; provided, however, that such attorneys’ fees
shall not exceed Ten Thousand Dollars (US$10,000).


Section 7.6            Tax
Matters.


(a)   Effective
Time for Tax Purposes. 
Notwithstanding any other provision of this Agreement, the Parties shall
treat the sale of the Assets hereunder as occurring as of the Closing for all
Tax purposes.


(b)   Transfer
Taxes.  Equitable and the Company
shall each pay any Transfer Taxes imposed on it by Law as a result of the
transactions contemplated by this Agreement, but, notwithstanding such requirement
at Law, the Company will indemnify and hold Equitable harmless from all such
Transfer Taxes.  Accordingly, if
Equitable is required at Law to pay any such Transfer Taxes, the Company shall
promptly reimburse Equitable for such amounts. 
Equitable and the Company shall timely file their own Transfer Tax
returns as required by Law and shall notify the other Party when such filings
have been made.  Equitable and the
Company shall cooperate and consult with



 27
 









each other prior to filing such Transfer Tax returns to ensure that all
such returns are filed in a consistent manner.


(c)   Preparation
of Tax Returns.  With respect to any
Tax Return covering a taxable period ending on or before the Closing Date (a “Pre-Closing
Taxable Period”) that is required to be filed after the Closing Date with
respect to the Assets, Equitable shall cause such Tax Return to be prepared (in
a manner consistent with practices followed in prior taxable periods except as
required by a change in Law or fact) and shall cause such Tax Return to be
executed and duly and timely filed with the appropriate Governmental Authority
and shall pay all Taxes shown as due on such Tax Return.  With respect to any Tax Return covering a
taxable period beginning on or before the Closing Date and ending after the
Closing Date (a “Straddle Taxable Period”) that is required to be filed after
the Closing Date with respect to the Assets, the Company shall cause such Tax
Return to be prepared (in a manner consistent with practices followed in prior
taxable periods except as required by a change in Law or fact) and shall cause
such Tax Return to be executed and duly and timely filed with the appropriate
Governmental Authority and, subject to Equitable’s payment to the Company of a
portion of such Tax pursuant to Section 7.6(d), shall pay all Taxes shown as
due on such Tax Return.


(d)   Liability
for Taxes.  Equitable shall be
responsible for and indemnify the Company against, and Equitable shall be
entitled to all refunds or credits of, any Tax with respect to the Assets that
is attributable to a Pre-Closing Taxable Period or to that portion of a
Straddle Taxable Period that ends on the Closing Date.  With respect to a Straddle Taxable Period,
Equitable and the Company shall determine the Tax attributable to the portion
of the Straddle Taxable Period that ends on the Closing Date by an interim
closing of the books with respect to the Assets as of the Closing Date, except
for ad valorem Taxes which shall be prorated on a daily basis to the Closing
Date, and Equitable shall pay to the Company an amount equal to the Tax so
determined to be attributable to that portion of a Straddle Taxable Period that
ends on the Closing Date within five (5) days prior to the due date for the
payment of such Tax to the extent not previously paid by Equitable.  The Company shall be responsible for and
indemnify Equitable against, and the Company shall be entitled to all refunds
and credits of, all Taxes with respect to the Assets that are attributable to
that portion of any Straddle Taxable Period beginning after the Closing
Date.  Notwithstanding the foregoing,
Equitable shall be entitled to the general abatement of property Taxes issued
by Dickenson County in the amount of one hundred thousand dollars (US$100,000)
per year for a period of five (5) years.


(e)   Tax
Proceedings.  With respect to any Tax
for which Equitable is responsible, Equitable shall have the right, at its sole
cost and expense, to control (in the case of a Pre-Closing Taxable Period) or
participate in (in the case of a Straddle Taxable Period) the prosecution,
settlement or compromise of any proceeding involving such Tax, including the
determination of the value of property for purposes of real and personal
property ad valorem Taxes.  The Company
shall take such action in connection with any such proceeding as Equitable
shall reasonably request from time to time to implement the preceding sentence,
including the execution of powers of attorney. 
Notwithstanding the



 28
 









foregoing, neither the Company nor Equitable shall settle any
proceeding with respect to any issue that could adversely affect the other
Party in a taxable period (or portion thereof) beginning after the Closing Date
without the other Party’s prior written consent, not to be unreasonably
withheld, conditioned or delayed.  The
Company shall give written notice to Equitable of its receipt of any notice of
any audit, examination, claim or assessment for any Tax which could result in
any such proceeding within twenty (20) days after its receipt of such notice.


(f)    Assistance
and Cooperation.  Equitable shall
grant to the Company (or its designees) access at all reasonable times to all
of the information, books and records relating to the Assets within the
possession of Equitable (including workpapers and correspondence with
Governmental Authorities), and shall afford the Company (or its designees) the
right (at the Company’s expense) to take extracts therefrom and to make copies
thereof, to the extent reasonably necessary to permit the Company (or its
designees) to prepare Tax Returns and to conduct negotiations with Governmental
Authorities.  The Company shall grant to
Equitable (or its designees) access at all reasonable times to all of the
information, books and records relating to the Assets within the possession of
the Company (including workpapers and correspondence with Governmental
Authorities), and shall afford Equitable (or its designees) the right (at
Equitable’s expense) to take extracts therefrom and to make copies thereof, to
the extent reasonably necessary to permit Equitable (or its designees) to
prepare Tax Returns and to conduct negotiations with Governmental
Authorities.  After the Closing Date,
Equitable and the Company will preserve all information, records or documents
relating to liabilities for Taxes with respect to the Assets until six months
after the expiration of any applicable statute of limitations (including
extensions thereof) with respect to the assessment of such Taxes.


Section 7.7            Further
Assurances.  After
Closing, each Party agrees to take such further actions and to execute,
acknowledge and deliver all such further documents as are reasonably requested
by any other Party for carrying out the purposes of this Agreement, or of any
document delivered pursuant to this Agreement.


Section 7.8            Assumption
of Obligations.  By
the consummation of the transactions contemplated by this Agreement at Closing,
and without limiting the indemnification obligations of either Party under this
Agreement, from and after Closing the Company agrees to assume and pay, perform
and discharge all obligations of Equitable with respect to the Assets.


Section 7.9            Pipeline
Agreement.


(a)   Each
of EPC and EGEL hereby consents and agrees to the transaction contemplated by
the Pipeline Agreement, with such consent to be effective as of the date of the
Pipeline Agreement.  PMOG hereby agrees
that the Pipeline Agreement does not breach or violate the Original Lease or
the Exploration Agreement.



 29
 









(b)   Upon
the contribution and assignment of the Pipeline Agreement by Equitable to the
Company, each of the Parties hereby consents and agrees the Pipeline Agreement
shall be cancelled and of no further force or effect.


Section 7.10         Operation
of Assets.  Except
as set forth on Schedule 7.10, until the Closing, Equitable will (a) operate
the Assets and the business with respect thereto in the ordinary course, (b)
not, without the prior written consent of PMOG, which consent shall not be
unreasonably withheld, conditioned or delayed, commit to any operation, or
series of related operations thereon, requiring future capital expenditures by
the Company as the owner of the Assets in excess of those amounts reflected in
the capital budget previously provided by Equitable to PMOG, or terminate,
materially amend, execute or extend any material Contracts affecting the
Assets, (c) maintain insurance coverage on the Assets in the amounts and of the
types presently in force, (d) use its commercially reasonable efforts to
maintain in full force and effect all rights of way, easements and similar real
property interests, (e) maintain all material Governmental Permits affecting
the Assets, (f) not transfer, sell, hypothecate, encumber or otherwise dispose
of any Assets, except for transfers, sales or other similar dispositions of
Assets, in one or more transactions, not exceeding Five Hundred Thousand
Dollars (US$500,000.00)  of
consideration (in any form), in the aggregate, and (g) not commit to do any of
the foregoing. PMOG’s approval of any action restricted by this Section 7.10
shall be considered granted within ten (10) days (unless a shorter time is
reasonably required by the circumstances and such shorter time is specified in
Equitable’s written notice) of Equitable’s written notice to PMOG requesting
such consent unless PMOG notifies such Person to the contrary in writing during
that period. In the event of an emergency, Equitable may take such action as a
prudent operator would take and shall notify PMOG of such action promptly
thereafter.


Section 7.11         Financial
Information.  Equitable
shall use its commercially reasonable efforts to (a) assist PMOG and PMOG’s
accountants, at the sole cost and expense of PMOG, in the preparation of either
(i) if relief is granted by the SEC, statements of revenues and direct
operating expenses and all notes thereto related to the Assets or (ii) if such
relief is not granted by the SEC, the financial statements required by the SEC
(such financial statements set forth in the foregoing clauses (i) and (ii), as
applicable, the “Statements of Revenues and Expenses”) in each case of clauses
(i) and (ii), that will be required of PMOG or any of its Affiliates in
connection with reports, registration statements and other filings to be made
by PMOG or any of its Affiliates related to the transactions contemplated by
this Agreement with the SEC pursuant to the Securities Act, or the Exchange
Act, in such form that such statements and the notes thereto can be audited and
(b) provide to PMOG access to such financial information as is reasonably
related to the preparation of the Statements of Revenues and Expenses; provided
that in no event shall Equitable be obligated to prepare or provide financial
information, records or financial statements other than those kept by it in its
ordinary course of business.


Section 7.12         Termination
of Gas Gathering Agreement.  Effective
as of the Closing, EGEL shall terminate and shall cause its Affiliate,
Equitable Energy, LLC, to terminate (with such termination to be effective as
of the Effective Time with



 30
 









respect to gas
produced by any member of the Company or any of its Affiliates, and as of the
Closing with respect to gas produced by unaffiliated third parties) that
certain Gas Gathering Agreement dated as of January 1, 2005 between EGEL and
Equitable Energy, LLC.


ARTICLE 8

CONDITIONS TO CLOSING


Section 8.1            Conditions
of Equitable to Closing.  The
obligations of Equitable to proceed to consummate the transactions contemplated
by this Agreement are subject, at the option of Equitable, to the satisfaction
on or prior to Closing of each of the following conditions:


(a)   Representations
of PMOG.  The representations and
warranties of PMOG set forth in Article 5 shall be true and correct
(disregarding any materiality qualifiers) as of the date of this Agreement and
as of the Closing Date as though made on and as of the Closing Date (other than
representations and warranties that refer to a specified date, which need only
be true and correct, disregarding any materiality qualifiers, on and as of such
specified date), except for such breaches, if any, that in the aggregate would
not have a Material Adverse Effect;


(b)   Performance.  PMOG shall have performed and observed, in
all material respects, all covenants and agreements to be performed or observed
by it under this Agreement prior to or on the Closing Date and all deliveries
contemplated by Section 9.3 shall have been made (or PMOG shall be ready,
willing and able to immediately make such deliveries);


(c)   Working
Interest Purchase. The transactions contemplated by the Purchase Agreement
shall have closed (or PMOG shall be ready, willing and able to simultaneously
close such transactions with the transactions contemplated hereby);


(d)   No
Action.  On the Closing Date, no
suit, action, or other proceeding (excluding any such matter initiated by a
Equitable or any of its Affiliates) shall be pending or threatened before
any Governmental Authority or body of competent jurisdiction seeking to enjoin
or restrain the consummation of the transactions contemplated by this Agreement
or recover substantial damages from Equitable or any Affiliate of Equitable
resulting therefrom;


(e)   Asserted
Title Defects/Casualties.  The sum of
all Asserted Title Defect Amounts for Asserted Title Defects properly reported
under Section 3.3(a), plus the Damages resulting from any casualty loss
occurring on or after the date hereof to all or any portion of the Assets,
shall be less than ten percent (10%) of the unadjusted Cash Contribution; and


(f)    HSR
Act.  The necessary waiting period
applicable to the consummation of the transactions contemplated hereby under
the HSR Act shall have expired, or early termination of the waiting period
shall have been granted.



 31
 









Section 8.2            Conditions
of PMOG to Closing.  The
obligations of PMOG to consummate the transactions contemplated by this Agreement
are subject, at the option of PMOG, to the satisfaction on or prior to Closing
of each of the following conditions:


(a)   Representations
of Equitable.  The representations
and warranties of Equitable set forth in Article 4 shall be true and correct
(disregarding any materiality qualifiers, including Material Adverse Effect) as
of the date of this Agreement and as of the Closing Date as though made on and
as of the Closing Date (other than representations and warranties that refer to
a specified date, which need only be true and correct, disregarding any
materiality qualifiers, including Material Adverse Effect, on and as of such
specified date), except for such breaches, if any, that in the aggregate would
not have a Material Adverse Effect;


(b)   Representations
of the Company.  The representations
and warranties of Company set forth in Article 6 shall be true and correct
(disregarding any materiality qualifiers, including Material Adverse Effect) as
of the date of this Agreement and as of the Closing Date as though made on and
as of the Closing Date (other than representations and warranties that refer to
a specified date, which need only be true and correct, disregarding any
materiality qualifiers, including Material Adverse Effect, on and as of such
specified date), except for such breaches, if any, that in the aggregate would
not have a Material Adverse Effect;


(c)   Performance.  Equitable and the Company shall have
performed and observed, in all material respects, all covenants and agreements
to be performed or observed by such Party under this Agreement prior to or on
the Closing Date and all deliveries by such Parties contemplated by Section 9.2
and Section 9.4 shall have been made (or such Parties shall be ready, willing
and able to immediately make such deliveries);


(d)   Working
Interest Purchase. The transactions contemplated by the Purchase Agreement
shall have closed (or EPC shall be ready, willing and able to simultaneously
close such transactions with the transactions contemplated hereby);


(e)   No
Action.  On the Closing Date, no
suit, action, or other proceeding (excluding any such matter initiated by PMOG
or any of its Affiliates) shall be pending or threatened before any
Governmental Authority or body of competent jurisdiction seeking to enjoin or restrain
the consummation of the transactions contemplated by this Agreement or recover
substantial damages from PMOG or any Affiliate of PMOG resulting therefrom;


(f)    Asserted
Title Defects/Casualties.  The sum of
all Asserted Title Defect Amounts for Asserted Title Defects properly reported
under Section 3.3(a), plus the Damages resulting from any casualty loss
occurring on or after the date hereof to all or any portion of the Assets,
shall be less than ten percent (10%) of the unadjusted Cash Contribution; and



 32
 









(g)   HSR
Act.  The necessary waiting period
applicable to the consummation of the transactions contemplated hereby under
the HSR Act shall have expired, or early termination of the waiting period
shall have been granted.


ARTICLE 9  

CLOSING


Section 9.1            Time
and Place of Closing.  The
consummation of the transactions contemplated by this Agreement (the “Closing”)
shall, (i) unless otherwise agreed to in writing by PMOG and Equitable or
otherwise provided in this Agreement, take place at the offices of Equitable
located at 225 North Shore Drive, Pittsburgh, Pennsylvania 15212, at 10:00
a.m., local time, on May 4, 2007, or (ii) if all conditions in Article 8 to be
satisfied prior to Closing have not yet been satisfied or waived, as soon
thereafter as such conditions have been satisfied or waived, subject to the
provisions of Article 10.  For the
avoidance of doubt, each Closing subsequent to the initial Closing pursuant to
Section 3.4 shall constitute a Closing for purposes of this Agreement and, as
such, the conditions to Closing set forth in Section 8.1 and Section 8.2, the
actions required at Closing by Section 9.2 and Section 9.3, and the adjustments
required by Section 2.2 shall apply with respect to each such Closing.  The date on which a Closing occurs is
referred to herein as the “Closing Date.”


Section 9.2            Closing
Deliveries of Equitable.  At
the Closing, upon the terms and subject to the conditions of this Agreement,
and subject to the simultaneous performance by PMOG of its obligations pursuant
to Section 9.3, Equitable shall deliver or cause to be delivered to PMOG and
the Company, among other things, the following:


(a)   Duly
executed conveyances of the Assets to the Company in substantially the form
attached hereto as Exhibit B (the “Conveyance”), in sufficient duplicate
originals to allow recording in all appropriate jurisdictions and offices;


(b)   A
certificate duly executed by an authorized officer of EPC, dated as of the
Closing, certifying on behalf of EPC that the conditions set forth in Section
8.2(a) and Section 8.2(c) have been fulfilled;


(c)   A
certificate duly executed by an authorized officer of EGEL, dated as of the
Closing, certifying (i) on behalf of EGEL that the conditions set forth in
Section 8.2(a) and Section 8.2(c) have been fulfilled and (ii) as the
sole member of the Company, on behalf of the Company, that the conditions set
forth in Section 8.2(b) and Section 8.2(c) have been fulfilled;


(d)   An
amended and restated limited liability company agreement duly executed by an
authorized officer of EGEL, dated as of the Closing, in substantially the form
attached hereto as Exhibit C (the “LLC Agreement”);


(e)   A
gas gathering agreement duly executed by an authorized corporate officer of
Equitable Energy LLC, dated as of the Closing, in substantially the form
attached hereto as Exhibit G (the “Gathering Agreement”);



 33
 









(f)    A
gas purchase agreement duly executed by an authorized officer of EPC and an
authorized officer of Equitable Energy LLC, dated as of the Closing, in
substantially the form attached hereto as Exhibit H;


(g)   A
change of control agreement duly executed by an authorized officer of each of
EPC, EGEL and PMOG, dated as of the Closing, in substantially the form attached
hereto as Exhibit L (the “Change of Control Agreement”);


(h)   A
guaranty agreement duly executed by an authorized officer of EQT Investments,
LLC, dated as of the Closing, in substantially the form attached hereto as
Exhibit M;


(i)    A
note duly executed by an authorized officer of ET Blue Grass Company, dated as
of the Closing, in substantially the form attached hereto as Exhibit E;


(j)    An
interconnection agreement duly executed by an authorized officer of EPC, dated
as of the Closing, in substantially the form attached hereto as Exhibit O; and


(k)   Resignations
of all managers and officers of the Company effective as of the Closing.


Section 9.3            Closing
Deliveries of PMOG.  At
the Closing, upon the terms and subject to the conditions of this Agreement,
and subject to the simultaneous performance by Equitable of its obligations
pursuant to Section 9.2 and by the Company of its obligations pursuant to
Section 9.4, PMOG shall deliver or cause to be delivered to Equitable and the
Company, among other things, the following:


(a)   A
wire transfer to the Company of the Cash Contribution and the Closing Payment
in same-day funds;


(b)   A
certificate duly executed by an authorized officer of PMOG, dated as of the
Closing, certifying on behalf of PMOG that the conditions set forth in Section
8.1(a) and Section 8.1(b) have been fulfilled;


(c)   The
LLC Agreement duly executed by an authorized officer of PMOG, dated as of the
Closing;


(d)   An
assignment of easement agreement duly executed by an authorized officer of
PMOG, dated as of the Closing, in substantially the form attached hereto as Exhibit
D (the “New Easement Agreement”);


(e)   As
assignment and bill of sale in substantially the form of Exhibit B (but with
PMOG as the assignor thereunder) assigning to the Company PMOG’s right, title
and interest (if any) in and to the gas gathering system, facilities,
compressors and pipelines described on Exhibit A-1;



 34
 









(f)    The
Change of Control Agreement duly executed by an authorized officer of PMOG,
dated as of the Closing; and


(g)   A
guaranty agreement duly executed by an authorized officer of Range Resources
Corporation, dated as of the Closing, in substantially the form attached hereto
as Exhibit N;


Section 9.4            Closing
Deliveries of the Company.  At
the Closing, upon the terms and subject to the conditions of this Agreement,
and subject to the simultaneous performance by PMOG of its obligations pursuant
to Section 9.3, the Company shall deliver or cause to be delivered to Equitable
and PMOG, among other things, the following:


(a)   The
LLC Agreement duly executed by an authorized officer of the Operating Member on
behalf of the Company, dated as of the Closing;


(b)   A
duly executed Conveyance and the New Easement Agreement, in sufficient
duplicate originals to allow recording in all appropriate jurisdictions and
offices;


(c)   The
Gathering Agreement duly executed by an authorized officer of the Operating
Member on behalf of the Company, dated as of the Closing;


(d)   The
New Easement Agreement duly executed by an authorized officer of the Operating
Member on behalf of the Company, dated as of the Closing; and


(e)   An
interconnection agreement duly executed by an authorized officer of the
Operating Member on behalf of the Company, dated as of the Closing, in
substantially the form attached hereto as Exhibit O.


ARTICLE 10

TERMINATION AND AMENDMENT


Section 10.1         Termination.  This Agreement may be
terminated at any time prior to Closing: 
(i) by the mutual prior written consent of EPC and PMOG;
(ii) by either of PMOG or EPC, if the Closing has not occurred on or
before sixty (60) days after the date hereof; (the “Termination Date”);
provided, however, that the right to terminate this Agreement under this
Section 10.1 shall not be available (A) to Equitable or the Company, if any
breach of this Agreement by Equitable or the Company has been the principal
cause of, or resulted in, the failure of the Closing to occur on or before the
Termination Date, or (B) to PMOG, if any breach of this Agreement by PMOG has
been the principal cause of, or resulted in, the failure of the Closing to
occur on or before the Termination Date; (iii) by Equitable, if (A) any of the
representations and warranties of PMOG contained in this Agreement shall not be
true and correct in all material respects (provided that any such
representation or warranty that is already qualified by a materiality standard
or a material adverse effect qualification shall not be further qualified); or
(B) PMOG shall have failed to fulfill in any material respect any of its
obligations under this Agreement; and, in the case of each of clauses (A) and
(B) of this subsection (iii), Equitable shall have given PMOG written notice of
such misrepresentation, breach of warranty



 35
 









or failure, if
curable, and such misrepresentation, breach of warranty or failure has not been
cured by the Termination Date; or (iv) by PMOG, if (A) any of the
representations and warranties of Equitable or the Company contained in this
Agreement shall not be true and correct in all material respects (provided that
any such representation or warranty that is already qualified by a materiality
or Material Adverse Effect qualification shall not be further qualified); or
(B) Equitable or the Company shall have failed to fulfill in any material
respect any of its obligations under this Agreement, and, in the case of each
of clauses (A) and (B) of this subsection (iv), PMOG shall have given Equitable
written notice of such misrepresentation, breach of warranty or failure, if
curable, and such misrepresentation, breach of warranty or failure has not been
cured by the Termination Date.


Section 10.2         Effect
of Termination.  If
this Agreement is terminated pursuant to Section 10.1, this Agreement shall
become void and of no further force or effect except for the provisions of
Section 4.4, Section 5.5, Section 7.2, Section 7.4 (other than the last
sentence thereof), Section 12.8, Section 12.17, Section 12.18 and Section
12.19,  which
shall continue in full force and effect. 
Notwithstanding anything to the contrary in this Agreement, the
termination of this Agreement under Section 10.1 shall not relieve any
Party from liability for Damages resulting from any willful or negligent breach
of this Agreement by such Party in any material respect.


ARTICLE 11  

INDEMNIFICATIONS; LIMITATIONS


Section 11.1       Indemnification.


(a)   [Intentionally
omitted].


(b)   From
and after Closing, Equitable shall indemnify, defend and hold harmless the
Company Indemnified Persons and the PMOG Indemnified Persons against and from
all Damages incurred or suffered by any such Indemnified Person:


(i)            caused
by, arising out of or resulting from the ownership, use, or operation of the
Assets before the Closing,


(ii)           caused
by, arising out of or resulting from Equitable’s or the Company’s breach of any
of the covenants or agreements contained in Article 7,


(iii)          caused
by, arising out of or resulting from any breach of any representation or
warranty made by Equitable or the Company contained in Article 4, Article 6 or
in the certificate delivered by Equitable at Closing pursuant to Section 9.2(b)
and Section 9.2(c),


(iv)          caused
by, arising out of or resulting from the claims, suits, proceedings and actions
described in Schedule 4.6A hereto, or



 36
 









(v)           caused
by, arising out of or resulting from (A) the Excluded Assets or (B) any
pipeline imbalances attributable to the Assets prior to the Closing,


except to the extent such Damages are
caused in whole or in part by the negligence (whether sole, joint, or
concurrent), strict liability, or other legal fault of any Indemnified Person.  Notwithstanding the foregoing, Equitable
shall not be required under this Section 11.1(b) to indemnify, defend or hold
harmless the PMOG Indemnified Persons from Property Costs accruing from and
after the Effective Time and attributable to the Assets.  The term “Company Indemnified Persons” as
used herein means the Company and its Affiliates and their respective
directors, officers, employees, stockholders, members, agents, consultants,
advisors and other representatives (including legal counsel, accountants and
financial advisors).  The term “PMOG
Indemnified Persons” as used herein means PMOG and its Affiliates and their
respective directors, officers, employees, stockholders, members, agents,
consultants, advisors and other representatives (including legal counsel,
accountants and financial advisors).


(c)   From
and after Closing, PMOG shall indemnify, defend, and hold harmless the Company
Indemnified Parties and the Equitable Indemnified Parties against and from all
Damages incurred or suffered by any such Indemnified Person:


(i)            caused
by, arising out of or resulting from PMOG’s breach of any of PMOG’s covenants
or agreements contained in Article 5, or


(ii)           caused
by, arising out of or resulting from any breach of any representation or
warranty made by PMOG contained in Article 5 of this Agreement or in the
certificate delivered by PMOG at Closing pursuant to Section 9.3(b),


except to the extent such Damages are
caused in whole or in part by the negligence (whether sole, joint, or
concurrent), strict liability, or other legal fault of any Indemnified Person.  The term “Equitable Indemnified Persons” as
used herein means Equitable and its Affiliates and their respective directors,
officers, employees, stockholders, members, agents, consultants, advisors and
other representatives (including legal counsel, accountants and financial advisors).


(d)   Notwithstanding
anything to the contrary contained in this Agreement, from and after Closing,
this Section 11.1 contains the Parties’ exclusive remedy against each other
with respect to breaches of the representations, warranties, covenants and agreements
of the Parties contained in Article 4, Article 5, Article 6 and Article 7
(excluding Section 7.2), which shall be separately enforceable by the injured
party pursuant to whatever rights and remedies are available to it outside of
this Article 11) and the affirmations of such representations, warranties,
covenants and agreements contained in the certificate delivered by each Party
at Closing pursuant to Section 9.2(b), Section 9.2(c) or Section 9.3(b), as
applicable.  Except for (i) the remedies
contained in this Section 11.1, (ii) any other remedies available to the
Parties at Law or in equity for



 37
 









breaches of provisions of this Agreement other than Article 4, Article
5, Article 6 and Article 7 (excluding Section 7.2) and (iii) the remedies
available in connection with any other document delivered by any Party in
connection with the transactions contemplated hereby, from and after Closing
each Party releases, remises, and forever discharges the other Parties and
their respective Affiliates and all such Persons’ stockholders, officers,
directors, employees, agents, advisors and representatives from any and all
suits, legal or administrative proceedings, claims, demands, damages, losses,
costs, liabilities, interest, or causes of action whatsoever, in Law or in
equity, known or unknown, which such Parties might now or subsequently may
have, based on, relating to or arising out of this Agreement or the
consummation of the transactions contemplated hereby, except to the extent caused in whole or in part by the negligence
(whether sole, joint, or concurrent), strict liability, or other legal fault of
any released Person.


(e)   “Damages”
shall mean the amount of any actual liability, loss, cost, expense, claim,
award, or judgment incurred or suffered by any Indemnified Person arising out
of or resulting from the indemnified matter, whether attributable to personal
injury or death, property damage, contract claims, torts or otherwise including
reasonable fees and expenses of attorneys, consultants, accountants, or other
agents and experts reasonably incident to matters indemnified against, and the
costs of investigation and/or monitoring of such matters, and the costs of
enforcement of the indemnity; provided, however, that no Party shall be
entitled to indemnification under this Agreement for, and “Damages” shall not
include (except to the extent that such Damages are awarded to an
unaffiliated  third Person) (i) loss of
profits or other consequential damages suffered by the Party claiming
indemnification, or any punitive damages or (ii) in the event the Indemnified
Person takes any action that exceeds the scope of the operating authority
granted to it under the LLC Agreement, any liability, loss, cost, expense,
claim, award or judgment to the extent and only to the extent increased by such
action..


(f)    The
indemnity to which each Party is entitled under this Agreement shall be for the
benefit of and extend to such Indemnified Persons affiliated with such Party as
described above in this Agreement.  Any
claim for indemnity under this Agreement by any such Indemnified Person (other
than a Party) must be brought and administered by the applicable Party to this
Agreement.  No Indemnified Person other
than a Party shall have any rights against any Party under the terms of this
Section 11.1 or otherwise under this Agreement except as may be exercised on
its behalf by such Party, pursuant to this Section 11.1(f).  Each Party may elect to exercise or not
exercise indemnification rights under this Section on behalf of the other
Indemnified Persons affiliated with it in its sole discretion and shall have no
liability to any such other Indemnified Person for any action or inaction under
this Agreement.


(g)   For
the sole purposes of the indemnities set forth in this Section 11.1, in
determining a breach or inaccuracy of any Party’s representations or warranties
and in calculating the amount of Damages incurred, arising out of or relating
to any such breach or inaccuracy of a representation or warranty, any
references to “Material Adverse Effect” or other materiality qualifications (or
correlative terms) shall be disregarded.



 38
 









Section 11.2         Indemnification
Actions.  All
claims for indemnification under Section 11.1 shall be asserted and resolved as
follows:


(a)   For
purposes of this Agreement, the term “Indemnifying Person” when used in
connection with particular Damages shall mean the Person having an obligation
to indemnify another Person or Persons with respect to such Damages pursuant to
this Agreement, and the term “Indemnified Person” when used in connection with
particular Damages shall mean a Person having the right to be indemnified with
respect to such Damages pursuant to this Agreement.


(b)   To
make claim for indemnification under Section 11.1, an Indemnified Person shall
notify the Indemnifying Person of its claim, including the specific details of
and specific basis under this Agreement for its claim (the “Claim Notice”).  In the event that the claim for
indemnification is based upon a claim by a third Person against the Indemnified
Person (a “Claim”), the Indemnified Person shall provide its Claim Notice
promptly after the Indemnified Person has actual knowledge of the Claim and
shall enclose a copy of all papers (if any) served with respect to the
Claim; provided that the failure of any Indemnified Person to give notice of a
Claim as provided in this Section 11.2 shall not relieve the Indemnifying
Person of its obligations under Section 11.1 except to the extent (and only to
the extent of such incremental Damages incurred) such failure results in
insufficient time being available to permit the Indemnifying Person to
effectively defend against the Claim or otherwise prejudices the Indemnifying
Person’s ability to defend against the Claim. 
In the event that the claim for indemnification is based upon an
inaccuracy or breach of a representation, warranty, covenant, or agreement, the
Claim Notice shall specify the representation, warranty, covenant, or agreement
that was inaccurate or breached.


(c)   In
the case of a claim for indemnification based upon a Claim, the Indemnifying
Person shall have thirty (30) days from its receipt of the Claim Notice to
notify the Indemnified Person whether or not it agrees to indemnify and defend
the Indemnified Person against such Claim under this Article 11.  The Indemnified Person is authorized, prior
to and during such thirty (30) day period, to file any motion, answer, or
other pleading that it shall deem necessary or appropriate to protect its
interests or those of the Indemnifying Person and that is not prejudicial to
the Indemnifying Person.


(d)   If
the Indemnifying Person agrees to indemnify the Indemnified Person, it shall
have the right and obligation to diligently defend, at its sole cost and
expense, the Claim.  The Indemnifying
Person shall have full control of such defense and proceedings, including any
compromise or settlement thereof.  If
requested by the Indemnifying Person, the Indemnified Person agrees to
cooperate in contesting any Claim, which the Indemnifying Person elects to
contest (provided, however, that the Indemnified Person shall not be required
to bring any counterclaim or cross-complaint against any Person).  The Indemnified Person may participate in,
but not control, at its sole cost and expense, any defense or settlement of any
Claim controlled by the Indemnifying Person pursuant to this Section
11.2(d).  An Indemnifying Person shall
not, without the written consent of



 39
 









the Indemnified Person, such consent not to be unreasonably withheld,
conditioned or delayed, settle any Claim or consent to the entry of any
judgment with respect thereto that (i) does not result in a final
resolution of the Indemnified Person’s liability with respect to the Claim
(including, in the case of a settlement, an unconditional written release of the
Indemnified Person from all liability in respect of such Claim) or
(ii) may materially and adversely affect the Indemnified Person (other
than as a result of money damages covered by the indemnity).


(e)   If
the Indemnifying Person does not agree to indemnify the Indemnified Person
within the thirty (30) day period specified in Section 11.2(c), fails to give
notice to the Indemnified Party within such thirty (30) day period regarding
its election, or if the Indemnifying Party agrees to indemnify, but fails to
diligently defend or settle the Claim, then the Indemnified Person shall have
the right to defend against the Claim (at the sole cost and expense of the
Indemnifying Person, if the Indemnified Person is entitled to indemnification
hereunder), with counsel of the Indemnified Person’s choosing; provided,
however, that the Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment that would give rise to liability on the part of
any Indemnifying Party without the prior written consent of such Indemnifying
Party, which consent shall not be unreasonably withheld, conditioned or
delayed.


(f)    In
the case of a claim for indemnification not based upon a Claim, the
Indemnifying Person shall have thirty (30) days from its receipt of the Claim
Notice to (i) cure the Damages complained of, (ii) agree to indemnify
the Indemnified Person for such Damages, or (iii) dispute the claim for
such Damages.  If such Indemnifying
Person does not respond to such Claim Notice within such thirty (30) day period,
such Person will be deemed to dispute the claim for Damages.


Section 11.3       Limitation
on Actions.


(a)   The
representations and warranties of the Parties in Article 4, Article 5 and
Article 6 and the covenants and agreements of the Parties in Article 7, and the
corresponding representations and warranties given in the certificates
delivered at the Closing pursuant to Section 9.2(b), Section 9.2(c) or Section
9.3(b), as applicable, shall survive the Closing for a period of one (1) year,
except that, (i) with respect to any taxable period, the representations,
warranties, covenants and agreements contained in Section 4.7 and Section 7.6
shall survive until the applicable statute of limitations closes such taxable
period and (ii) the provisions of Section 4.4, Section 5.5 and the last
sentence in Section 7.4 shall survive the Closing without time limit.  The remainder of this Agreement shall survive
the Closing without time limit, except as provided in Section 11.3(b)
below.  Representations, warranties, covenants,
and agreements shall be of no further force and effect after the date of their
expiration (if any), provided that there shall be no termination of any bona
fide claim asserted pursuant to this Agreement with respect to such a
representation, warranty, covenant, or agreement prior to its expiration date.



 40
 









(b)   The
indemnities in Section 11.1(b)(ii), Section 11.1(b)(iii), Section 11.1(c)(i)
and Section 11.1(c)(ii) shall terminate as of the termination date of each
respective representation, warranty, covenant or agreement that is subject to
indemnification, except (in each case) as to matters for which a specific
written claim for indemnity has been delivered to the Indemnifying Person on or
before such termination date.  The
indemnities in Section 11.1(b)(i)  shall terminate on the date which is
three (3) years from the Closing Date except (in each case) as to matters for
which a specific written claim for indemnity has been delivered to the
Indemnifying Person on or before such termination date.


(c)   Except
for claims relating to a breach of a Party’s obligations under Section 4.4,
Section 4.7, Section 5.5, Section 7.6, no individual claim of an Indemnified
Person may be made against any Party for any Damages under Article 10 unless
such Damages exceed an amount equal to Fifty Thousand Dollars (US$50,000).
Furthermore, except for claims relating to a breach of a Equitable’s
obligations under Section 4.4, Section 4.7, the last sentence of Section 7.4,
Section 7.6, Section 11.1(b)(iv) and Section 11.1(b)(v), Equitable shall not
have any liability for any indemnification under Section 11.1(b) until and
unless the aggregate amount of the liability for all Damages for which Claim
Notices are delivered by the Company or PMOG exceeds Three Hundred Fifty Thousand
Dollars (US$350,000.00), then only to the extent such Damages exceed Three
Hundred Fifty Thousand Dollars (US$350,000.00). 
The adjustments under Section 2.2, any further adjustments with respect
to income, proceeds, receipts and credits under Section 12.1, any future
adjustments with respect to Property Costs under Section 12.2 and any payments
in respect of any of the preceding, as well as any Damages arising out of a
breach by a Party of any other provision of this Agreement (excluding the
provisions of Article 4, Article 5, Article 6 and Article 7), shall not be
limited by this Section.


(d)   Notwithstanding
anything to the contrary contained elsewhere in this Agreement, Equitable shall
not be required to indemnify any Party under this Article 11 (excluding Section
11.1(b)(iv) and Section 11.1(b)(v)) for aggregate Damages in excess of fifteen
percent (15%) of the Cash Contribution.


(e)   The
amount of any Damages for which an Indemnified Person is entitled to indemnity
under this Article 11 shall be reduced by the amount of insurance proceeds
actually realized and received by the Indemnified Person or its Affiliates with
respect to such Damages (net of any collection costs, and excluding the
proceeds of any insurance policy issued or underwritten by the Indemnified
Person or its Affiliates).


ARTICLE 12  

MISCELLANEOUS


Section 12.1         Receipts.  Any income, proceeds,
receipts and credits attributable to the Assets which are not reflected in the
adjustments to the Cash Contribution following the final adjustment pursuant to
Section 2.2(b) shall be treated as follows: 
(a) all income, proceeds, receipts and credits earned with respect
to the Assets to which the Company is entitled under



 41
 









Section 1.5 shall
be the sole property and entitlement of the Company, and, to the extent
received by Equitable, Equitable shall fully disclose, account for and remit
the same promptly to the Company; and (b) all income, proceeds, receipts and
credits earned with respect to the Assets to which Equitable is entitled under
Section 1.5 shall be the sole property and entitlement of Equitable and, to the
extent received by the Company, the Company shall fully disclose, account for
and remit the same promptly to Equitable.


Section 12.2         Property
Costs.  Any
Property Costs which are not reflected in the adjustments to the Cash
Contribution following the final adjustment pursuant to Section
2.2(b) shall be treated as follows: 
(a) all Property Costs for which Equitable is responsible under
Section 1.5 shall be the sole obligation of Equitable and Equitable shall
promptly pay, or if paid by the Company, promptly reimburse the Company for and
hold the Company harmless from and against same; and (b) all Property
Costs for which the Company is responsible under Section 1.5 shall be the sole
obligation of the Company and the Company shall promptly pay, or if paid by
Equitable, promptly reimburse Equitable for and hold Equitable harmless from
and against same.


Section 12.3         Counterparts.  This Agreement may be
executed in counterparts, each of which shall be deemed an original instrument,
but all such counterparts together shall constitute but one agreement.


Section 12.4         Notices.  All notices that are
required or may be given pursuant to this Agreement shall be sufficient in all
respects if given in writing and delivered personally, by facsimile or by
recognized courier service, as follows:


	
  If to EPC or EGEL:

  	
  225 North Shore Drive

  
	
   

  	
  Pittsburgh, Pennsylvania  15212

  
	
   

  	
  Attention:

  	
  Corporate Secretary

  
	
   

  	
  Telephone:

  	
  (412)553-5700

  
	
   

  	
  Telecopy:

  	
  (412)553-7781

  
	
   

  	
   

  
	
  With a copy to:

  	
  Baker Botts LLP

  
	
   

  	
  1500 San Jacinto Center

  
	
   

  	
  98 San Jacinto Avenue

  
	
   

  	
  Austin, Texas 78701

  
	
   

  	
  Attention:

  	
  Michael Bengtson

  
	
   

  	
  Telephone:

  	
  (512)322-2661

  
	
   

  	
  Telecopy:

  	
  (512)322-8349

  
	
   

  	
   

  
	
  If to PMOG:

  	
  777 Main Street, Suite 800

  
	
   

  	
  Fort Worth, Texas 
  76102

  
	
   

  	
  Attention:

  	
  Chad Stephens

  
	
   

  	
  Telephone:

  	
  (810) 817-1929

  
	
   

  	
  Telecopy:

  	
  (810) 817-1990

  



 



 42
 









 


	
  With a copy to:

  	
  125 State Route 43

  
	
   

  	
  P.O. Box 550

  
	
   

  	
  Hartville, OH 
  44632

  
	
   

  	
  Attention:

  	
  Jeffery A. Bynum

  
	
   

  	
  Telephone:

  	
  (330) 877-6747

  
	
   

  	
  Telecopy:

  	
  (330) 877-6129

  
	
   

  	
   

  
	
  If to the
  Company:

  	
  225 North Shore Drive

  
	
   

  	
  Pittsburgh, Pennsylvania  15212

  
	
   

  	
  Attention:

  	
  Corporate Secretary

  
	
   

  	
  Telephone:

  	
  (412)553-5700

  
	
   

  	
  Telecopy:

  	
  (412)553-7781

  



 


Any Party may
change its address for notice by notice to the other Party in the manner set
forth above.  All notices shall be deemed
to have been duly given at the time of receipt by the Party to which such
notice is addressed if received during regular business hours on a Business Day
or, if not so received, on the next Business Day.


Section 12.5         [Intentionally
Omitted].


Section 12.6         Expenses.  All expenses incurred by
Equitable or the Company in connection with or related to the authorization,
preparation or execution of this Agreement, and the Exhibits and Schedules
hereto and thereto, and all other matters related to the Closing, including all
fees and expenses of counsel, accountants and financial advisers employed by
Equitable, shall be borne solely and entirely by Equitable, and all such
expenses incurred by PMOG shall be borne solely and entirely by PMOG.


Section 12.7         Replacement
of Bonds, Letters of Credit and Guarantees. 
The Parties understand that none of the bonds, letters
of credit and guarantees, if any, posted by Equitable or any of its Affiliates
with any Governmental Authority or third Person and relating to the Assets are
to be transferred to the Company.  As
soon as practicable following Closing, the Company shall obtain, or cause to be
obtained in the name of the Company, replacements for such bonds, letters of
credit and guarantees, to the extent such replacements are necessary to permit
the cancellation of the bonds, letters of credit and guarantees posted by
Equitable and such Affiliates or to consummate the transactions contemplated by
this Agreement.


Section 12.8         Governing
Law; Jurisdiction; Court Proceedings. 
This Agreement and the legal relations between the
Parties shall be governed by and construed in accordance with the laws of the
Commonwealth of Virginia without regard to principles of conflicts of laws that
would direct the application of the laws of another jurisdiction.  Each of the Parties agrees that it shall
bring any action or proceeding in respect of any claim arising out of or
related to this Agreement or the transactions contemplated hereby exclusively
in the Federal Court for the Western District of Virginia (the “Chosen Court”)
and, solely in connection with claims arising under this Agreement or the
transactions contemplated hereby, (i) irrevocably submits to the



 43
 









exclusive
jurisdiction of the Chosen Court, (ii) waives any objection to laying venue in
any such action or proceeding in the Chosen Court, and (iii) waives any
objection that the Chosen Court is an inconvenient forum or does not have
jurisdiction over it.  The foregoing
consents to jurisdiction shall not constitute general consents for any purpose
except as provided herein and shall not be deemed to confer rights on any Person
other than the Parties.


Section 12.9         Records.  Equitable shall provide
access to PMOG to such Records as PMOG shall reasonably request that are in the
possession of Equitable or its Affiliates, in order for PMOG to make copies of
the same, provided that Equitable shall be permitted to retain the originals of
all such Records as Operating Member of the Company.


Section 12.10       Captions.  The captions in this
Agreement are for convenience only and shall not be considered a part of or
affect the construction or interpretation of any provision of this Agreement.


Section 12.11       Waivers.  Any failure by any Party to
comply with any of its obligations, agreements or conditions herein contained
may be waived by the Party to whom such compliance is owed by an instrument
signed by the Party to whom compliance is owed and expressly identified as a
waiver, but not in any other manner.  No
waiver of, or consent to a change in, any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of, or consent to a change in,
other provisions hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.


Section 12.12       Assignment.  No Party shall assign or
otherwise transfer all or any part of this Agreement, except to a wholly-owned
Affiliate in a transfer whereby this Agreement remains binding upon the
transferring Party, nor shall any Party delegate any of its rights or duties
hereunder, without the prior written consent of the other Party and any
transfer or delegation made without such consent shall be void.  Subject to the foregoing, this Agreement
shall be binding upon and inure to the benefit of the Parties hereto and their
respective successors and assigns.


Section 12.13       Entire
Agreement.  This
Agreement, the Exhibits and Schedules attached hereto and the documents to be
executed hereunder or in connection with a condition to Closing, together with
the Purchase Agreement, the exhibits and schedules attached thereto and the
documents to be executed thereunder or in connection with a condition to the
closing thereof (the “Transaction Documents”), shall constitute the entire
agreement among the Parties and their Affiliates pertaining to the subject
matter of the Transaction Documents, and supersede all prior agreements,
understandings, negotiations and discussions, whether oral or written, among
the Parties and their Affiliates regarding such subject matter, including that
certain letter of intent, dated as of September 25, 2006, between Range
Resources Corporation and Equitable Resources, Inc. (the “Letter of Intent”).  The Parties agree that, effective as of the
Execution Date, the Letter of Intent shall be of no further force and effect.



 44
 









Section 12.14       Amendment.  This Agreement may be
amended or modified only by an agreement in writing signed by Equitable and
PMOG and expressly identified as an amendment or modification.


Section 12.15       No
Third Person Beneficiaries.  Nothing
in this Agreement shall entitle any Person other than a Party to any claim,
cause of action, remedy or right of any kind, except the rights expressly
provided to the Persons described in Section 11.1(f).


Section 12.16     References.


In
this Agreement:


(a)   References
to any gender include a reference to all other genders;


(b)   References
to the singular include the plural, and vice versa;


(c)   Reference
to any Article or Section means an Article or Section of this Agreement;


(d)   Reference
to any Exhibit or Schedule means an Exhibit or Schedule to this Agreement, all
of which are incorporated into and made a part of this Agreement;


(e)   Unless
expressly provided to the contrary, “hereunder”, “hereof”, “herein” and words
of similar import are references to this Agreement as a whole and not any
particular Section or other provision of this Agreement; and


(f)    “Include”
and “including” shall mean include or including without limiting the generality
of the description preceding such term.


Section 12.17       Construction.  PMOG is a party capable of
making such investigation, inspection, review and evaluation of the Assets as a
prudent person would deem appropriate under the circumstances, including with
respect to all matters relating to the Assets, their value, operation and
suitability.  Each of Equitable, PMOG and
the Company has had the opportunity to exercise business discretion in relation
to the negotiation of the details of the transaction contemplated hereby.  This Agreement is the result of arm’s-length
negotiations from equal bargaining positions.


Section 12.18       Limitation
on Damages.  Notwithstanding
anything to the contrary contained herein, no Party or any of their respective
Affiliates shall be entitled to consequential, special or punitive damages in
connection with this Agreement and the transactions contemplated hereby (other
than consequential, special or punitive damages suffered by unaffiliated third
Persons for which responsibility is allocated to a Party) and each Party,
for itself and on behalf of its Affiliates, hereby expressly waives any right
to consequential, special or punitive damages in connection with this Agreement
and the transactions contemplated hereby.



 45
 









Section 12.19       Attorneys’
Fees.  Except as
expressly provided in Section 3.3(f) and Section 2.2(c), in connection with any
suit, action or other proceeding to enforce any Party’s obligations under this
Agreement, the Party prevailing in such suit, action or other proceeding shall
be entitled to seek the recovery of all its costs and fees (including attorneys’
fees, experts’ fees, administrative fees, arbitrators’ fees and court costs)
incurred in connection with such suit, action or other proceeding.


[SIGNATURE
PAGE FOLLOWS]



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IN WITNESS WHEREOF, this Agreement has been
signed by each of the Parties as of  the
Execution Date.


	
  

  	
  EPC:

  	
  Equitable Production Company

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/

  	
  Joseph E. O’Brien

  
	
   

  	
   

  	
  Name:

  	
  Joseph E. O’Brien

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EGEL:

  	
  Equitable Gathering Equity, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/

  	
  Joseph E. O’Brien

  
	
   

  	
   

  	
  Name:

  	
  Joseph E. O’Brien

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PMOG:

  	
  Pine Mountain Oil and Gas, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/

  	
  Chad L. Stephens

  
	
   

  	
   

  	
  Name:

  	
  Chad L. Stephens

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President -

  
	
   

  	
   

  	
   

  	
  Corporate Development

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  COMPANY:

  	
  Nora Gathering, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/

  	
  Joseph E. O’Brien

  
	
   

  	
   

  	
  Name:

  	
  Joseph E. O’Brien

  
	
   

  	
   

  	
  Title:

  	
  President

  



 


SIGNATURE PAGE TO CONTRIBUTION
AGREEMENT