instruction:
In this task, you're given a passage that represents a legal contract or clause between multiple parties, followed by a question that needs to be answered. Based on the paragraph, you must write unambiguous answers to the questions and your answer must refer a specific phrase from the paragraph. If multiple answers seem to exist, write the answer that is the most plausible.
question:
Exhibit 1

Execution Copy

JOINT VENTURE AGREEMENT

BETWEEN

TATE & LYLE FERMENTATION PRODUCTS LTD.

AND

IGENE BIOTECHNOLOGY, INC.

Table of Contents

1.

2.

DEFINITIONS

CREATION OF THE JOINT VENTURE AND ITS STRUCTURE

Page

1

4

3.

4.

PARTIES' CONTRIBUTIONS TO THE JOINT VENTURE AND FINANCING

PARTIES' INTERESTS IN THE JOINT VENTURE

4

6

5.

6.

[INTENTIONALLY OMITTED]

TAX CONSIDERATIONS

6

6

7.

8.

PARTIES' WITHDRAWAL FROM THE FIELD OF AGREEMENT

FUTURE PRODUCTS AND DEVELOPMENTS

8

8

9.

10.

MANAGEMENT AND CONTROL OF THE JOINT VENTURE

DAY-TO-DAY MANAGEMENT OF THE JOINT VENTURE

10

12

11. SERVICES TO BE PROVIDED TO THE JOINT VENTURE BY THE PARTIES 12

12. RIGHT OF FIRST REFUSAL; TERMINATION OF THE JOINT VENTURE AFTER THE EFFECTIVE DATE 14

13. LIABILITIES 15

14. WARRANTIES BY THE PARTIES 16

15. CONDITIONS PRECEDENT; TERMINATION OF AGREEMENT 17





16. OPERATIONS UNTIL TRANSFER 18

17. ASSIGNMENT; PLEDGE OF JOINT VENTURE INTEREST 19

18. COSTS, FEES AND TAXES 19

19. NOTICES 19

20. LAW 20

21. MISCELLANEOUS PROVISIONS 20

22. DISPUTE RESOLUTION PROCEDURES; LIQUIDATION 23

23. JOINT VENTURE TO BE BOUND 24

JOINT VENTURE AGREEMENT

This Joint Venture Agreement (as amended, restated, supplemented or otherwise modified in accordance herewith, this Agreement) is entered into as of March 18, 2003 and is by and between Tate & Lyle Fermentation Products Ltd., a corporation organized under the laws of England (T&L) and a subsidiary of Tate & Lyle PLC, and Igene Biotechnology, Inc., a Maryland corporation (Igene; collectively with T&L, the Parties).

RECITALS

A. Igene owns certain technology and expertise related to the manufacture and sale of Astaxanthin and derivative products, and T&L and its subsidiaries and affiliates possess expertise with respect to all aspects of the manufacture and production of numerous products through fermentation.

B. In an effort to capitalize on their respective strengths and expertise, Igene and T&L wish to form a joint venture to manufacture and sell Astaxanthin and derivative products worldwide, all in accordance with the principles set out in this Agreement (including each of its relevant constituent entities, the Joint Venture). The Parties anticipate that the primary market for the product of the Joint Venture will initially be limited to Chile, parts of Europe, Japan and other parts of Asia.

C. Such Joint Venture shall consist initially of two legal entities to be formed as soon after the execution as practicable which together will have sufficient financial, mechanical, technological and land rights, resources and assets, to allow them to operate with limited assistance from the Parties.

D. Without derogating from the principles of Recital C, it is also understood and recognized by the Parties that, in order to minimize support and administrative costs associated with the operation of the Joint Venture, certain ongoing services will be provided to the Joint Venture by the Parties over various periods of time in consideration for payments from the Joint Venture as described in the appropriate agreements between the Joint Venture and the Parties.

E. The Parties envision the Joint Venture continuing in effect for an indefinite period, subject to termination in accordance with this Agreement.

AGREEMENT

Now therefore, the Parties agree:

1. DEFINITIONS.

In this Agreement, the following words shall have the meanings set forth below:





1.1. AFFILIATE means, with respect to any Party, any other entity controlling, controlled by or under common control with, such Party. The term control shall mean direct or indirect ownership of at least fifty percent (50%) of the outstanding voting stock of a corporate entity or voting interest in a non-corporate entity and shall also mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of an entity.

1.2. AVERAGE MARKET PRICE means the spot price for Astaxanthin as determined by the weighted average market price over the 30 day period prior to purchase as set forth in the books and records of the Joint Venture.

1.3. BOARD is defined in Article 9.1.

1.4. BOARD DISPUTE is defined in Article 22.1.

1.5. COMMENCEMENT DATE is the first business day after the first 30 consecutive days of production following the start-up phase in which 3 fermenters located at the Manufacturing Facility (constructed in accordance with the Construction Agreement) have been continuously operating.

1.6. CONSTRUCTION AGREEMENT is defined in Article 3.6.

1.7. EVENT OF BANKRUPTCY for any Person means (i) such Person files a petition in bankruptcy or insolvency, (ii) such Person files for reorganization or for the appointment of a receiver or trustee of all or a material portion of such Party's assets, (iii) such Person makes an assignment for the benefit of creditors, (iv) such Person admits in writing its inability to pay its debts as they fall due, (v) such Person seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of a material portion of its assets, (vi) such Person fails to have any petition in bankruptcy or insolvency, or for reorganization, or for the appointment of a receiver or trustee of all or a material portion of such Person's assets dismissed within sixty (60) days after the commencement of any proceeding as a result thereof or (vii) such Person fails to have any levy or attachment on all or a material portion of its assets released or discharged within sixty (60) days of imposition thereof.

1.8. DISCLOSING PARTY is defined in Article 21.4.

1.9. EFFECTIVE DATE means 12:01 a.m. Eastern Standard Time on March 3, 2003.

1.10. FACILITIES means collectively, the Site and the Manufacturing Facility to be located thereon, as well as any other manufacturing facilities constructed, acquired or operated by the Joint Venture from time to time.

1.11. FIELD OF AGREEMENT is defined in Article 2.1.

1.12. FORMATION is defined in Article 3.3.

1.13. FORMATION DATE means the business day immediately following the Formation.

1.14. GENERAL MANAGER is defined in Article 18.5.

1.15. HSR ACT means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

1.16. INDEMNIFYING PARTY is defined in Article 13.1.

1.17. INFORMATION is defined in Article 21.4.

1.18. LAWSUIT is defined in Article 13.1.

1.19. LIQUIDATION NOTICE is defined in Article 22.3.

1.20. MANAGEMENT is defined in Article 10.1.

1.21. MANUFACTURING FACILITY means the manufacturing facility to be constructed by Parent on behalf of the Manufacturing Company at the Site in accordance with the provisions of Article 3.6 which will be capable of producing 14,000 kg per annum of pure Astaxanthin.

1.22. NEUTRACEUTICAL means a nutritional supplement for human consumption.

1.23. OFFER is defined in Article 12.1.

1.24. OFFER PRICE is defined in Article 22.2.





1.25. OFFEREE is defined in Article 12.1.

1.26. OPTION PERIOD is defined in Article 12.1.

1.27. PARENT means Tate & Lyle Industries Ltd.

1.28. PARTY shall mean each of T&L and Igene, and PARTIES shall mean both T&L and Igene.

1.29. PARTY HEADS means the Chairman of the Board of Igene and the Chief Financial Officer of Tate & Lyle North America, Inc. respectively.

1.30. QUALIFIED EXPERT is defined in Article 12.2(c).

1.31. RECIPIENT PARTY is defined in Article 21.4.

1.32. SELLING PARTY is defined in Article 12.1.

1.33. SITE is defined in Article 3.5.

1.34. TECHNOLOGY is defined in Appendix 3.2.

1.35. TRANSFERRED ASSETS means the assets of Igene that are to be transferred to the Operating Company as more particularly described in Appendix 3.2.

2. CREATION OF THE JOINT VENTURE AND ITS STRUCTURE.

2.1. Subject to the terms and conditions stated in this Agreement, the Parties shall take all such steps and do all such things as are reasonably necessary to create between T&L and Igene a joint venture commencing from the date hereof until the date this Agreement is terminated with respect to (a) the manufacture of Astaxanthin and derivative products and (b) the marketing and sale of Astaxanthin and derivative products worldwide for all uses other than uses as a Neutraceutical or otherwise for direct human consumption (collectively, the Field of Agreement). Notwithstanding the foregoing, nothing herein shall, or shall be deemed to, form a partnership or any other entity other than the Operating Company and the Manufacturing Company (as defined below).

2.2. The legal structure of the Joint Venture shall be (a) a limited liability company organized under the laws of Bermuda and owned by the Parties as set forth herein (the Operating Company) which in turn will own all of the shares of (b) a corporation formed under the laws of the United Kingdom (the Manufacturing Company). T&L and Igene shall cause such entities to be formed promptly after the execution of this Agreement in a manner consistent with the terms of this Agreement.

2.3. (a) Upon the terms and subject to the conditions of this Agreement, each of the Parties hereby agrees to use commercially reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary or proper under applicable laws and regulations to consummate and make effective the transactions contemplated by this Agreement, including, without limitation, obtaining consent under the HSR Act (if necessary) and any other relevant governmental consents. The Parties shall share the cost of any filings required under this Article 2.3 equally.

(b) Notwithstanding clause (a) above, nothing contained in this Agreement will require or obligate either Party to initiate any litigation to which any governmental authority is a party, although the Parties agree to use commercially reasonable good faith efforts to negotiate with the applicable governmental authority, as the case may be, in order to avoid any such litigation.

(c) Notwithstanding clause (a) above, nothing contained in this Agreement will require or obligate either Party to agree or otherwise become subject to any limitations on the right of the Joint Venture to acquire, own, control or operate the Transferred Assets (including either Party or the Joint Venture being required to sell or otherwise dispose of, or hold separate, the Transferred Assets), if such Party reasonably believes in its good faith judgment as a result of any such limitation that it cannot substantially realize the material benefits that such Party reasonably expects to derive from the Joint Venture. The Parties agree to use commercially reasonable good faith efforts to negotiate with any applicable governmental authority in order to avoid any such limitations.

3. PARTIES' CONTRIBUTIONS TO THE JOINT VENTURE AND FINANCING.

3.1. Subject to the terms and conditions of this Agreement, T&L shall contribute, or cause to be contributed, to the Operating Company cash in the amount of $21,614,000. Subject to the terms and conditions of this Agreement, T&L further agrees to pay to Operating Company as a contribution to capital upon Formation (as defined below) $3,000,000.

3.2. Subject to the terms and conditions of this Agreement, Igene shall transfer and assign, or cause to be transferred and assigned,





to the Operating Company the Transferred Assets described in Appendix 3.2.

3.3. The Parties intend that the transfer of the Transferred Assets to the Operating Company pursuant to Articles 3.1 and 3.2 and the other various transactions, transfers, contributions and agreements to be made or entered by and between Igene or T&L and the Operating Company in connection with the formation of the Joint Venture, shall be made promptly upon the formation of both the Operating Company and the Manufacturing Company (Formation). In the event that the Transferred Assets are not transferred to the Operating Company at such time or on such other date as is specified herein or in the Asset Transfer Agreement, the entity who is to make such transfer(s) shall, without any further cost to the Joint Venture or to the other Party, (a) ensure that the Joint Venture shall have all of the benefits and bear all of the burdens of such assets on and from Formation and (b) fully and legally assign to the Operating Company such assets as soon after Formation as practicable.

3.4. Title to the Transferred Assets shall be passed to the Operating Company in accordance with Asset Transfer Agreement to be entered into by the Operating Company and Igene upon Formation. Such Asset Transfer Agreement shall be in the form set forth in Appendix 3.4. Such Transferred Assets shall be contributed free and clear of any and all indebtedness, liens and encumbrances.

3.5. As promptly as possible after Formation, the Manufacturing Company shall enter into a lease with Parent with respect to the lease of certain real property located in Selby, England adjacent to the existing facility of an Affiliate of Parent (the Site), which lease will have a term of at least 50 years at an annual rent of $1 and shall grant to the Manufacturing Company all rights necessary to construct and operate the Manufacturing Facility.

3.6. Upon Formation, the Manufacturing Company shall enter into an Engineering, Procurement and Construction Management Agreement in the form set forth in Appendix 3.6 (the Construction Agreement), pursuant to which Parent shall supervise and manage the construction of the Manufacturing Facility on a turnkey basis in consideration for a payment of $21,614,000. Upon the entering into of the agreements referred to in Articles 3.5 and 3.6, the Operating Company shall capitalize the Manufacturing Company through the contribution of equity received by it from T&L pursuant to Article 3.1 in an amount equal to at least $21,614,000.

3.7. It is the intention of the Parties that any debt incurred by the Joint Venture shall be non-recourse against each Party. Each of the Parties agrees to use its reasonable best efforts to cause the Joint Venture to incur long-term indebtedness in an amount that is consistent with the business and cash desires of the Parties and the cash needs of the Joint Venture; provided, however, that neither Party shall be required to contribute any additional capital or guarantee, directly or indirectly, any debt of the Joint Venture including without limitation any leases or other direct or indirect obligations.

4. PARTIES' INTERESTS IN THE JOINT VENTURE.

4.1. The Parties shall each have a fifty percent (50%) interest in the Operating Company, and control of the Joint Venture shall be shared equally between the Parties. The Parties agree that their respective contributions to the Operating Company have equal value, and that no payment shall be made from one Party to the other Party in the event appraisals performed for tax accounting reasons of the Transferred Assets give rise or would give rise to different valuations.

4.2. All profits and losses earned or incurred by the Operating Company shall be shared by the Parties in equal shares as long as each Party has a 50% interest in the Operating Company. Upon a reduction or increase in such interest, all profits and losses shall be shared in accordance with each Party's ownership interest in the Joint Venture. To the greatest extent permitted by applicable law and accounting provisions, (a) the Operating Company shall make distributions, dividends and returns of capital equally to each of the Parties and (b) Operating Company items of income, gain, loss and deduction shall be allocated equally to each of the Parties; provided, if for any reason, such distributions, dividends, returns of capital or allocations may not be made on an equal basis, the Operating Company shall make a special distribution, dividend, return of capital or allocation to one Party to balance the required distribution, dividend, return of capital or allocation to the other Party.

4.3. Notwithstanding the foregoing, if for any reason the contribution of* T&L proves to have a value materially less than that attributed to it at the Effective Date as a result of the Facilities not being constructed as provided herein then either (a) T&L shall contribute a cash amount to the Operating Company to make up the shortfall or (b)(i) T&L's capital account shall be adjusted to reflect the revaluation of its contribution, (ii) T&L's interest in the Operating Company shall be adjusted to reflect its actual proportion of the contributions made upon the formation of the Joint Venture and (iii) the Joint Venture shall be liquidated as provided in Article 22.3.

* Portions intentionally deleted pursuant to a request for confidential treatment.

5. [INTENTIONALLY OMITTED]





6. TAX CONSIDERATIONS.

6.1. Each Party shall produce and submit to the Board, as promptly as possible, a reasonable estimate of their respective income tax liability with respect to the income of the Operating Company computed pursuant to the provisions of this paragraph as by a reasonably prudent taxpayer attempting to reduce the income tax payable by such taxpayer to the greatest extent permitted by law (a Party Tax Estimate). A Party Tax Estimate shall be calculated pursuant to United States and/or United Kingdom law and regulations (and the laws and regulations of any other jurisdiction under which the earnings of the Operating Company may be taxable to either Party) as may be applicable to either Party. The tax liability shall be calculated based on each Party's share of the income, gain, costs, expenses and deductions of the Operating Company in the prior year without consideration of items of income, gain, loss or deduction applicable to either Party derived from outside the Operating Company (including, without limitation, with respect to Igene, any Net Operating Loss that Igene may have accumulated prior to the formation of the Joint Venture), but shall include any items of income, gain, loss or deduction derived from the Operating Company in any previous year to the extent applicable to such year. Such Party Tax Estimate shall not be deemed to be final until it is approved by the Board; provided, that if the Board does not approve the higher Tax Estimate, and cannot resolve such a dispute within thirty days of the submission of such Tax Estimate to the Board, then the lesser Tax Estimate (the Preliminary Minimum Distribution) shall be paid to both Parties pursuant to Article 6.2 as if it were the Minimum Distribution. After the expiration of such thirty day period, the Board shall promptly submit the higher Tax Estimate (the Disputed Estimate) to PricewaterhouseCoopers (the Neutral Auditor) who shall evaluate the reasonableness and accuracy of the Disputed Estimate in light of the provisions of this Article 6.1. The Party that submitted the Disputed Estimate shall promptly provide to the Neutral Auditor all information requested by the Neutral Auditor in order to perform the analysis required by this Article 6.1. Within thirty days of receiving all information it deems necessary to perform the analysis required herein, the Neutral Auditor shall inform the Board in writing that it either agrees or disagrees that the Disputed Estimate is reasonable and accurate in light of the provisions of this Article 6.1 and the tax information submitted to it. If the Neutral Auditor concludes that the Disputed Estimate is reasonable and accurate, the difference between the Disputed Estimate and the Preliminary Minimum Distribution shall be promptly paid to each Party. If the Neutral Auditor concludes that the Disputed Estimate is not reasonable and/or accurate then the Preliminary Minimum Distribution shall be deemed the Minimum Distribution for the applicable year; provided, however, that if the Neutral Auditor concludes that an amount greater than the Preliminary Minimum Distribution is appropriate, then such greater amount shall be deemed the Minimum Distribution for the applicable year. The costs of the Neutral Auditor shall be paid equally by the Parties.

6.2. Subject to the provisions of Article 6.1, the Operating Company shall annually declare and pay by March 15 a distribution to each Party equal to the larger of the two estimated annual tax liabilities as reflected on the approved Party Tax Estimates (the Minimum Distribution). A portion of the Minimum Distribution shall be paid in advance on a quarterly basis should either Party be required to pay periodic mandatory payments of estimated taxes during any given year. In the event that such estimated taxes are required to be paid by either Party, such Party shall notify the Operating Company of the date of such required payments and the Operating Company shall pay to each Party, no later than 5 business days prior to the due date of each quarterly estimated tax payment specified in the notice above, an amount equal to 25% of the estimated Minimum Distribution. In the event that such distributions of estimate taxes are made within a given year, then the distribution on March 15 of the subsequent year shall be adjusted to reflect the advance distributions of related estimated taxes made prior to that date.

6.3. The Operating Company shall annually within 90 days after the end of each fiscal year declare an additional distribution equal to 20% of the net income of the Operating Company, half of which is to be paid to each Party (the Target Distribution). The Target Distribution shall be paid except when the Board shall determine otherwise.

6.4. The Board may pay other distributions at its discretion.

6.5. Notwithstanding the foregoing, the Operating Company shall only pay distributions or dividends to the extent permitted by applicable law.

7. PARTIES' WITHDRAWAL FROM THE FIELD OF AGREEMENT.

7.1. Each Party shall, and shall cause each of its Affiliates to, do all such things and shall take all such steps as are reasonably necessary to effect its total withdrawal from the Field of Agreement. Such withdrawal shall be effective from the Effective Date.

7.2. After the Effective Date and as long as Igene and T&L continue to own an interest in the Operating Company, neither of the Parties shall, or shall cause or permit any of their Affiliates to, directly or indirectly, as stockholders, consultants, members, partners or in any other capacity, engage in any enterprise or business anywhere in the world, which (a) manufactures Astaxanthin or (b) develops, markets, or sells products falling within the Field of Agreement. In the event that either (x) one Party shall transfer its entire interest in the Operating Company as permitted pursuant to this Agreement and the Operating Company shall remain a going concern after the closing of such transfer or (y) both Parties sell their interest in the Operating Company as permitted pursuant to this Agreement and the Operating Company shall remain a going concern after the closing of such transfer, then any Party which





ceases to own an interest in the Operating Company as a result of such transfer shall remain subject to the terms of this Article 7.2 for a period of ten (10) years after the date of such transfer. Notwithstanding the foregoing, if a court of competent jurisdiction determines that the obligations set forth in this Article 7.2 are unreasonable in scope, time or geography, such court is hereby authorized by the Parties to enforce such provisions with narrower scope, shorter time or lesser geography as such court determines to be the maximum that is reasonable and proper in the circumstances.

7.3. Except as set forth in Articles 7.1, 7.2, 8.1 and 8.2, it is explicitly agreed that nothing contained in this Agreement shall prevent either Party or any of their respective Affiliates from engaging, directly or indirectly, in any enterprise, which develops, manufactures, markets, or sells products that are not within the Field of Agreement, and except as set forth in Articles 7.1, 7.2, 8.1 and 8.2, either Party shall be free to engage in any business, enterprise, or undertaking, or to make any investment it chooses.

8. FUTURE PRODUCTS AND DEVELOPMENTS.

8.1. If, after the date of this Agreement and continuing as long as either Party is a partner, member, or shareholder of the Operating Company, such Party or any of its Affiliates receives or discovers any opportunity within the Field of Agreement, including without limitation developing or completing the development of, or discovering, or acquiring proprietary rights over, a product or process that falls within the Field of Agreement, the Operating Company then shall have exclusive rights to exploit such opportunity, but only within the Field of Agreement. The Party (or its Affiliate) that has developed, discovered or acquired such opportunity, product or process will, however, be entitled to exploit such opportunity, product or process for application outside the Field of Agreement.

8.2. If, after the date of this Agreement and continuing as long as either Party is a partner, member, or shareholder of the Operating Company, such Party or any of its Affiliates receives or discovers any opportunity to use Astaxanthin as a Neutraceutical (a Neutraceutical Opportunity), including without limitation developing or completing the development of, or discovering, or acquiring proprietary rights over, a product or process that involves the use of Astaxanthin as a Neutraceutical, such Party shall (or shall cause its Affiliate to) present such opportunity to the Operating Company, providing the Operating Company with such narrative description and budgetary and other information as such Party (or its Affiliates) may have generated or gathered to the extent necessary to evaluate such Neutraceutical Opportunity. The Board shall consider the material presented by such Party and its Affiliates and shall elect whether the Joint Venture should pursue such Neutraceutical Opportunity. If the Board elects to pursue such Neutraceutical Opportunity, the Operating Company then shall have exclusive rights to exploit such Neutraceutical Opportunity, but solely with respect to use of Astaxanthin as a Neutraceutical, and, subject to Article 8.1, the Party (or its Affiliate) that has developed, discovered or acquired such opportunity, product or process will, however, be entitled to exploit such opportunity, product or process for application outside of use of Astaxanthin as a Neutraceutical. If however the Board does not elect to pursue such Neutraceutical Opportunity, the Party (or its Affiliate) that has developed, discovered or acquired such opportunity, product or process shall, subject to Article 8.1, be entitled to exploit such opportunity, product or process; provided, that subsequent developments or discoveries with respect to such Neutraceutical Opportunity would reasonably be expected to affect the Board's acceptance or rejection of such Neutraceutical Opportunity, such Party shall (or shall cause its Affiliate to) present such Neutraceutical Opportunity to the Board with reference to the pertinent subsequent developments or discoveries.

8.3. If, after the date of this Agreement and continuing as long as a Party is a partner, member, or shareholder of the Operating Company, the Joint Venture develops or completes the development of, or discovers, or acquires proprietary rights over, a process or product which at, or after, the time of its development, discovery or acquisition has, or might have, some application outside of the Field of Agreement, then the appropriate entity of the Joint Venture shall offer to license the use of the process or product (or the production thereof) for such application to each of the Parties on reasonable commercial terms (including, without limitation, the possible payment of royalties at market rates) taking into account the time and money spent by the Joint Venture and taking into account other relevant commercial factors. The grant of licenses to any third parties shall be the prerogative of the Board provided that no such license shall be granted at terms more favorable to the third party than were offered to the member(s) of such Party.

8.4. In the event either T&L or Igene wishes to market Astaxanthin for uses other than in the Field of Agreement, including but not limited to the use of Astaxanthin as a neutraceutical or otherwise for direct human consumption, either T&L or Igene, as the case may be, shall be permitted to purchase reasonable quantities of Astaxanthin from the Operating Company for use in the manufacture of such products at the Average Market Price. The Joint Venture will manufacture such Astaxanthin to the standard required for its business, and each Party desiring to market Astaxanthin for other uses shall process the product acquired from the Operating Company at its own cost and expense.

9. MANAGEMENT AND CONTROL OF THE JOINT VENTURE.

9.1. The Joint Venture will be managed and controlled by a board of directors comprised of six (6) members (the Board). Each Party shall appoint three (3) of such members (none of whom shall be residents of the United Kingdom) and shall be entitled to





appoint any successor appointees as necessary such that the Board shall always be comprised of three members appointed by each Party. Each Party shall be entitled to appoint alternate directors on a periodic and temporary basis as needed. Each party agrees at all times to vote in favor of the directors appointed by the other Party or any successor appointees.

9.2. The Board shall have a Chairman selected in odd-numbered years by Igene and in even-numbered years by T&L for the duration of the calendar year. The Party with the right to select the Chairman shall select the Chairman from among the members of the Board appointed by it. If for any reason the individual serving as the Chairman ceases to be a member of the Board, such individual shall also cease to serve as Chairman and the Party who appointed such individual to the Board may select another individual appointed by that Party to the Board to serve as Chairman through the remainder of such calendar year. The Chairman shall serve as the chairman of all meetings of the Board and shall serve in such other administrative capacities as may be appropriate or as the Board may determine from time to time, but the Chairman shall not have any additional vote or authority by virtue of being the Chairman.

9.3. The Board shall have regular meetings at least once each calendar quarter which shall be called by the Chairman by written notice delivered to each Board member no later than five business days prior to the meeting specifying the date, time and place for such meeting. Either Party may at any time provide the Chairman with a written request that the Chairman convene a special meeting, whereupon the Chairman shall call a special meeting to be held within two weeks after receipt of such request by written notice delivered to each Board member no later than five business days prior to the meeting specifying the date, time and place for such meeting. Any member of the Board may attend a meeting by telephonic equipment if such member may hear and be heard by all present at that meeting (including others participating telephonically).

9.4. The decisions of the Board shall be by majority vote of the members present at a meeting, provided that such majority vote includes the affirmative vote of at least one member appointed by each Party. Notwithstanding the foregoing, after either Party either has an Event of Bankruptcy or is and continues to be in material breach of this Agreement (unless such breach is being contested by the breaching party in good faith) and no director appointed by such Party attends a duly convened meeting of the Board (after notice delivered pursuant to Article 9.3), the affirmative vote of three members of the Board at a duly convened meeting of the Board shall constitute approval of the Board for all purposes hereunder, regardless of whether a member of the Board appointed by each Party approves such matter.

9.5. The Board shall establish various authorizations and delegations for Management (as described below) to conduct the business of the Joint Venture as contemplated by Article 1.1 hereof. In addition, the Board shall:

(a) select the officer who will manage the Joint Venture on a day-to-day basis (the General Manager) subject to the direction of the Board who need not be an employee of the Joint Venture;

(b) approve any and all individual capital investments to be made by the Joint Venture in excess of $50,000 or, at its discretion, delegate such approval to the General Manager with respect to capital investments that do not exceed amounts to be determined by the Board in such delegation;

(c) approve any dividend or profit distribution to be made to the shareholders, members or partners, as the case may be, in excess of the Minimum Distribution in accordance with Article 6.2;

(d) approve any merger of the Operating Company or any acquisition of another entity or all or substantially all of another entity's assets by the Operating Company;

(e) the sale, disposition or purchase of individual assets for in excess of $50,000;

(f) approve the closing of any plant or facility of the Joint Venture;

(g) approve any related-party contracts, except as contemplated in this Agreement;

(h) approve any incurrence of indebtedness for borrowed money;

(i) change the business purpose of the Joint Venture;

(j) approve the discontinuance of any operations of the Joint Venture;

(k) determine the annual business plan and budget (including capital expenditures) and any material variance from such plan and budget;





(l) approve any contract or commitment for a period greater than twelve months;

(m) approve any capacity increase at any manufacturing site;

(n) determine budgets for continuing research concerning the development of strains and process methods for Astaxanthin;

(o) approve the material tax and accounting policies of the Joint Venture (which shall include for the Operating Company the application of U.S. generally accepted accounting principles); and

(p) approve the issuance of new or additional interests in the Operating Company (but not including, in any case, any transfer of existing interests as otherwise provided herein).

If the Board should be deadlocked on any matter, the dispute resolution procedures set forth in Article 22.1 shall apply.

9.6. The Joint Venture shall be jointly controlled by the Parties who, as shareholders, members, or partners, shall have the exclusive power, by instructing the Board, to: (i) dissolve the Joint Venture, (ii) sell, or dispose of all or substantially all assets of the Joint Venture or permit the Joint Venture to place or grant any consensual lien or security interest on its assets (except liens for taxes and materialsmen's liens being contested in good faith which are not material in amount), or (iii) permit the Joint Venture to engage in material commerce outside the Field of Agreement or change the scope of the Field of Agreement. Upon receipt of such instructions, the Board shall act in accordance with this Article 9.

10. DAY-TO-DAY MANAGEMENT OF THE JOINT VENTURE.

10.1. Except as provided in Article 9.5, the Board shall delegate the conduct of the day-to-day business of the Joint Venture to the General Manager, together with the officers and employees of the companies providing the services set forth in Article 11 (collectively the Management). The General Manager shall also have whatever title is appropriate for each entity in the Joint Venture reflecting his or her role as the primary manager and officer of each entity. The initial General Manager will be Peter Boynton who will be secunded to the Joint Venture on a part-time basis.

10.2. Subject to Article 9.5 and the direction of the Board, the Management shall direct, supervise and conduct the business of the Joint Venture in the following areas:

(a) creation, development, and implementation of routine commercial policies and procedures;

(b) creation, development, and implementation of sales and marketing strategies;

(c) treasury and financial management;

(d) manufacturing, maintenance and other operations;

(e) legal services; and

(f) research and development.

11. SERVICES TO BE PROVIDED TO THE JOINT VENTURE BY THE PARTIES.

11.1. Contemporaneously with the execution of this Agreement, each Party will enter into an agreement or agreements substantially in the form attached hereto as Appendix 11.1.1 and Appendix 11.1.2 pursuant to which each Party or its Affiliates shall provide the services identified for it below (the Support Services Agreements, and each a Support Services Agreement). The Support Services Agreements shall provide that the parties will provide the following services to the Joint Venture:

11.1.1.Igene or its Affiliates will provide to the Joint Venture:

(i) Sales and marketing services related to the world-wide sale and marketing of Astaxanthin in the Field of Agreement;

(ii) Research services related to further development of the Technology and improvement of manufacturing process efficiencies, as requested by the Board from time-to-time; and





(iii) Administration of the contract for manufacturing of Axtaxanthin with Fermic S.A. de Mexico pursuant to the terms of the Support Services Agreement.

11.1.2.T&L or its Affiliates will provide to the Joint Venture:

(i) Engineering and operations services;

(ii) Technical and research services related to the further development of the Technology and improvement of manufacturing process efficiencies, as requested by the Board from time-to-time;

(iii) Transportation and logistics services; and

(iv) Finance and accounting services.

11.1.3.The charge for the services set forth in Article 11.1.1 and 11.1.2 is set forth in the appropriate Support Services Agreement and shall be paid by the Operating Company.

11.1.4.T&L or its Affiliates shall also provide certain utilities and waste treatment services to the Joint Venture from its existing facility located at the Site. Such services shall be reimbursed by the Operating Company in an amount as more fully set forth in the appropriate Support Services Agreement.

11.2. In the event that either Party conveys its interest in the Operating Company to the other or a third party during the five year period commencing on the Effective Date and the Joint Venture continues to operate as a going concern thereafter, each Party shall provide the services described in Article 11.1 to the Joint Venture at a price (that shall reasonably be consistent with the methodology used for determining prices prior to such conveyance) to be agreed upon by the Parties for a transition period to allow the owner or owners of the Operating Company to obtain such services for the Joint Venture independently. Such transition period shall not exceed 24 months for the services set forth in Article 11.1.1 and Article 11.1.2 and shall not exceed 36 months for the services set forth in Article 11.1.4; provided, however, if T&L shall give notice to Igene that it intends to close the Selby, England facility adjacent to the Site, T&L shall be required to provide the services set forth in Article 11.1.4 for a period not to exceed 24 months from the date Igene receives such notice.

11.3. In the event of a contradiction between the terms of this Article 11 and any Support Services Agreement, the terms of the Support Services Agreement shall govern.

12. RIGHT OF FIRST REFUSAL; TERMINATION OF THE JOINT VENTURE AFTER THE EFFECTIVE DATE.

12.1. RIGHT OF FIRST REFUSAL; TAG-ALONG RIGHTS.

Prior to one year from the Effective Date, a Party may not sell or otherwise transfer its interest in the Operating Company. Thereafter, any sale or other transfer may not be effectuated except pursuant to a good faith, arms' length offer to sell its entire ownership interest in the Operating Company for cash consideration to a party who is not affiliated with such Party (a Third Party Offer). If either Party has received a Third Party Offer that it intends to accept (the Offer), such Party (the Selling Party) shall notify the other Party (the Offeree) of the Offer, which notice shall include a copy of the Offer and any other information necessary to enable the Offeree to evaluate reasonably the Offer and the potential purchaser. The Offeree shall have thirty (30) days after receipt of the notice from the Selling Party (the Option Period) to elect either (i) to purchase the Selling Party's interest in the Operating Company or (ii) to sell the Offeree's interest in the Operating Company to the Selling Party, in either case on the same terms and conditions as those contained in the Offer. If the Offeree makes one of such elections, the applicable purchase and sale shall take place within sixty (60) days after the date of the Offeree's election in accordance with the terms and conditions of the Offer or such other terms and conditions as the Selling Party and the Offeree shall mutually agree. If the Offeree does not make one of such elections within the Option Period, the Selling Party shall have the right to sell its interest to the person or entity who made the Third Party Offer for cash consideration only on terms and conditions no more favorable to such person or entity within sixty (60) days after the expiration of the Option Period. If such sale is not completed within such sixty (60) day period, the offer from the Selling Party shall be deemed to have been revoked and any subsequent offer from such Selling Party shall be subject to the right of first refusal described herein.

12.2. TERMINATION OF THE JOINT VENTURE.

(a) If there is an Event of Bankruptcy with respect to either Party, then the other Party may elect either to terminate the Joint





Venture (and follow the liquidation procedures set forth in Article 22.3) or to purchase the interest of the Party who had an Event of Bankruptcy for a purchase price equal to the market value of such interest as determined pursuant to subsection (c). Such election shall occur within 60 days after the Event of Bankruptcy unless prohibited by a bankruptcy court or other court of competent jurisdiction; provided that once any such prohibition is no longer applicable, such election shall occur promptly thereafter. The other Party shall provide written notice to the Party who had an Event of Bankruptcy upon the election of the other Party, which notice shall specify the effective date of the action elected by the other Party.

(b) If the Parties shall agree to terminate the Joint Venture pursuant to the terms of the Agreement, the Parties agree to terminate the Joint Venture and follow the liquidation procedures set forth in Article 22.3 unless the Parties otherwise agree.

(c) Upon delivery by either Party of such Party's election to purchase the interest of the other Party upon the other Party having an Event of Bankruptcy, the Board shall meet for the purpose of retaining a mutually acceptable, qualified investment banking, accounting or appraisal firm of national reputation with no conflict of interest with respect to either Party or any Affiliate thereof (a Qualified Expert) to determine the market value of the Operating Company. If the Board is unable to select by unanimous agreement a single Qualified Expert, then the appraisal shall be arrived at by mutual agreement of two Qualified Experts, one selected by each Party. If in such an instance either Party shall fail to appoint a Qualified Expert within fifteen (15) days after a written request to do so, such failure shall be deemed acceptance of the conclusions and appraisal of such Qualified Expert as has been appointed. If the Board unanimously selects a single Qualified Expert, the value of the Operating Company as determined by such Qualified Expert shall be final and binding upon both of the Parties. If two Qualified Experts are chosen, one by each Party, and such Qualified Experts either agree or the greater of the two valuations is no more than 110% of the lesser valuation, the average of the valuations of the Operating Company as determined by each such Qualified Expert shall be the value of the Operating Company for the purposes of this Article 12.2 and shall be final and binding upon both Parties. If two Qualified Experts are chosen, one by each Party, and such Qualified Experts cannot agree within thirty (30) days of the appointment of the second of such Qualified Expert (or their valuations differ by more than 10%), then (i) the two appointed Qualified Experts shall select a third Qualified Expert, (ii) if the determination of any of the three Qualified Experts is greater than the two smallest determinations or smaller than the two greatest determinations, in either case by more than 125% of the difference between such other determinations, such determination will be disregarded and the average of the two remaining determinations shall be final and binding upon both of the Parties and (iii) otherwise, the average of the three determinations of the three Qualified Experts shall be final and binding upon both of the Parties. The market value for the interest of the Party who has had an Event of Bankruptcy shall equal the market value of the Operating Company as determined above times the interest of such Party in the Operating Company as stated in Article 4.1.

13. LIABILITIES.

13.1. Igene (the Indemnifying Party) shall indemnify and hold harmless T&L, its Affiliates, the Operating Company and the Manufacturing Company, and their respective officers, directors, shareholders and agents (collectively, the Indemnified Parties) from and against any and all claims, demands, actions, lawsuits, proceedings, liabilities, losses, costs and expenses (including reasonable attorney's fees and disbursements incurred by any of the Indemnified Parties in respect of any such claims, demands, actions, lawsuits or proceedings) arising from any actual or alleged infringement of any patent, trademark, trade name, trade dress, copyright, trade secret or other proprietary right (whether under the laws of any country or of the European Union) resulting from the ownership or use of the Technology by Igene or as contemplated herein, including without limitation a failure of the Operating Company to have unencumbered rights in the Technology as a result of the pending lawsuit (the Lawsuit) styled Archer Daniels Midland Corporation v. Igene Biotechnology, Inc., United States District Court for the District of Maryland, Case No. S97-2358, or any similar claim.

*

* Intentionally deleted pursuant to a request for confidential treatment.

14. WARRANTIES BY THE PARTIES

14.1. Each Party represents and warrants to the other Party that:

14.1.1. General Corporate Matters. (i) it is duly formed and validly existing, and it is in good standing in the state of its incorporation and in each other state except where the failure to be in good standing would not have a material adverse effect on the formation or operation of the Joint Venture, (ii) it is duly authorized and has the requisite power to execute this Agreement and to form the Joint Venture and to do all other things necessary to implement the various agreements contemplated in and by this Agreement, (iii) this Agreement has been duly executed, and constitutes the legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, except





to the extent that the enforceability thereof against such Party may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally or by equitable principles of general application, (iv) none of such Party's Transferred Assets are subject to any liens or security interests (except liens for taxes and materialsmen's liens being contested in good faith which are not material in amount), and (v) it has disclosed to the other Party all material facts and circumstances existing on the date hereof which could reasonably be likely to, in such Party's commercially reasonable judgment, have a material adverse effect on the Joint Venture.

14.1.2. Litigation. There are no suits, actions, arbitrations, or legal, administrative or other proceedings or governmental investigations pending or, to its knowledge, threatened against or affecting it or any of its shareholders or members that if decided adversely to it or its shareholders or members could reasonably be expected to have a material adverse effect on its business, operations or financial condition or that could reasonably be expected to prevent the consummation of the Joint Venture, except for the Lawsuit.

14.1.3. Bankruptcy. There are no attachments, executions or assignments for the benefit of creditors, or voluntary or involuntary proceedings in bankruptcy, or under any other debtor relief laws, contemplated by or pending or threatened against it. Without limiting the generality of the foregoing, none of the following have been done by, against or with respect to it: (i) the commencement of a case under Title 11 of the U.S. Code, as now constituted or hereafter amended, or under any other applicable federal or state bankruptcy law or other similar law; (ii) the appointment of a trustee or receive of any property interest; (iii) an assignment for the benefit of creditors; (iv) an attachment, execution or other judicial seizure of a substantial property interest; (v) the taking of, failure to take, or submission to, any action indicating an inability to meet its financial obligations as they accrue; or (vi) a dissolution or liquidation.

14.2. Igene represents and warrants to T&L (i) that the Technology, the Brands and all other Transferred Assets set forth in Appendix 3.2 constitute all know-how and intellectual property owned, used or possessed by Igene with respect to the Field of Agreement, (ii) that it has good and workable title to the Transferred Assets, free and clear of any and all liens, claims and encumbrances, except for the Lawsuit, and (iii) this Agreement and each document contemplated hereby is sufficient to transfer Igene's right, title and interest in the Transferred Assets to the Operating Company.

14.3. Igene warrants to T&L that the Technology, the Brands and other Transferred Assets do not infringe on any third-party patent, trademark or other rights.

14.4. T&L represents and warrants to Igene that (i) the Manufacturing Facility will be constructed in accordance with the terms of the Construction Agreement, free and clear of all liens, claims and encumbrances and (ii) the Manufacturing Facility will be a turnkey project capable of producing 14,000 kg per year of pure Astaxanthin.

15. CONDITIONS PRECEDENT; TERMINATION OF AGREEMENT.

15.1. The obligation of each Party to consummate the agreements and covenants set forth herein is subject to the satisfaction (or waiver) on the Effective Date of the following conditions:

A. Subject to Article 2.3, if necessary, approval shall have been received under the HSR Act and any other applicable competition law, or the waiting period thereunder shall have expired;

B. Any other necessary governmental approvals for the formation and operation of the Joint Venture as contemplated herein shall have been given (either expressly or by operation of law); and

C. Approval of the Board of Directors of each of T&L and Igene shall have been given.

15.2. Without prejudice to the foregoing, without liability to the other Party except in the case of a breach of this Agreement, either Party shall be entitled to terminate this Agreement at any time from the date hereof up to Formation, if:

A. Subject to Article 2.3, an order of any court, arbitrator, or governmental, regulatory or administrative body, shall be in effect which restrains or prohibits the transactions contemplated hereby;

B. Any final and nonappealable determination of the Lawsuit or any other claim subject to indemnification under Article 13 shall arise either of which, in the business judgment of T&L, restricts the ability of Igene to perform its obligations hereunder or with respect to the Operating Company or the Joint Venture;





C. There has arisen, after the date of this Agreement, any bona fide claim or litigation involving, directly or indirectly, one or both of the Parties, of any member of either Party, or any shareholder, director, officer, employee, agent, consultant or representative of any Party, which may reasonably be expected to materially and adversely affect the Transferred Assets and/or the business falling with the Field of the Agreement; or

D. There has been a material adverse change reasonably outside of the control of the Party seeking to terminate with respect to the Transferred Assets of the other Party.

E. The Effective Date has not occurred on or prior to March 3, 2003.

16. OPERATIONS UNTIL TRANSFER.

From and after the date hereof, each Party will use its reasonable best efforts to ensure that (i) no liens or security interest shall be created or levied on the Transferred Assets (except liens for taxes and materialsmen's liens being contested in good faith which are not material in amount), and (ii) the assets to be transferred to the Operating Company, shall be operated in the ordinary course of business consistent with past business practices, and no portion thereof (except inventory sold in the ordinary course of business) shall be sold, conveyed, or otherwise transferred prior to transfer to the Operating Company.

17. ASSIGNMENT; PLEDGE OF JOINT VENTURE INTEREST.

Except as permitted pursuant to Article 13.1 hereof, neither Party shall assign or transfer this Agreement, or any and all related rights and obligations in the Joint Venture or all rights and all obligations in any related agreements, without the prior written consent of the other Party, which consent may not be unreasonably withheld or delayed; provided, however, any Party may assign any or all of its interests in this Agreement or the Operating Company to a wholly-owned subsidiary (which shall at all times remain a wholly-owned subsidiary, and such subsidiary may be a partnership, limited liability company, or corporation) or commonly-owned affiliate of Igene or T&L, as the case may be, provided that the ultimate parent company (e.g. Igene or T&L, as the case may be) shall guarantee such subsidiary's or affiliate's performance hereunder. Without the prior written consent of the other Party, neither Igene nor T&L, as the case may be, shall pledge, encumber, or grant a security interest in, any interest (stock, membership or partnership) in the Operating Company. Any permitted assignee shall, prior to the effectiveness of any assignment to such assignee, agree in writing to be bound by, and assume each obligation of the assigning Party under, this Agreement, and each other document and agreement relating to the Joint Venture to which the assignor (or its Party) is a Party, which such written agreement shall be in a form satisfactory to the Party not assigning its interest hereunder.

18. COSTS, FEES AND TAXES.

18.1. Unless the Parties agree otherwise in writing and except as otherwise provided herein, each Party shall bear and pay its own costs, expenses and fees incurred in connection with the making of this Agreement.

18.2. Any and all stamp duties, transfer taxes, recording and filing fees, and other similar statutory costs, incurred or payable in connection, directly or indirectly, with the transfer to the Operating Company of any of the Transferred Assets, or the implementation of this Agreement and the formation of the Joint Venture, shall be borne and paid by the Joint Venture. Notwithstanding the previous sentence, any and all taxes relating to income, capital gains, or other similar taxes or charges shall be borne by the Party transferring the Transferred Assets to the Operating Company.

19. NOTICES.

19.1. Any notice to be served by one Party on the other in connection with this Agreement shall be validly served if delivered by overnight delivery service (costs pre-paid), confirmed fax, or delivered in person, to the following addresses (or such other address as a Party may specify from time to time in accordance with this Article):

A. Tate & Lyle Fermentation Products Ltd. c/o Tate & Lyle North America Inc. 2200 E. Eldorado Street Decatur, Illinois 62521 Attn: General Counsel FAX: 217-421-4704

B. with a copy to:

Tate & Lyle North America Inc.





2200 E. Eldorado Street Decatur, Illinois 62521 Attn: Chief Financial Officer FAX: 217-421-4507

C. Igene Biotechnology, Inc. 9110 Red Branch Road Columbia, Maryland 21045-2024 Attention: Stephen F. Hiu FAX: 410-730-0540 TEL: 410-997-2599

with a copy to:

Stroock & Stroock & Lavan LLP 180 Maiden Lane New York, New York 10038 Attention: Martin H. Neidell FAX: 212-806-7836 TEL 212-806-5836

After the Effective Date, the Operating Company shall give each of the Parties appropriate addresses for notices.

19.2. Any notice validly served on a business day of the recipient and in accordance with Article 19.1 shall be deemed served on the day of receipt in the case of faxed, hand-delivered, and overnight delivery service notices.

20. LAW.

This Agreement shall be governed and construed in accordance with the laws of the State of Delaware, without reference to the conflicts of laws principles thereunder.

21. MISCELLANEOUS PROVISIONS.

21.1. THIRD PARTIES. Except as expressly stated herein with respect to members of each Party, no person or entity not a Party to this Agreement (including, without limitation, any employee of either Party or the Joint Venture) shall be a third-party beneficiary of any provision of this Agreement, and nothing contained herein shall be construed or deemed to confer any benefit or right upon any third party.

21.2. BROKERS. Each Party agrees to indemnify and hold the other harmless against any and all liability to any broker retained by such Party in connection with this Agreement and the transactions contemplated by this Agreement.

21.3. PRESS RELEASES. Except as required by law or securities exchange rules, public announcements and press releases concerning this Agreement and the transactions contemplated hereby shall be made only as mutually agreed by the Parties.

21.4. ENTIRE AGREEMENT; CONFIDENTIALITY.

A. This Agreement, including the Appendices attached to this Agreement and the Recitals set forth herein, constitutes the entire agreement between the Parties pertaining to the subject matter hereof, and all prior representations, discussions and negotiations between the Parties and/or their representatives pertaining to the subject matter of this Agreement are superseded. Notwithstanding the preceding sentence, the terms and provisions of the certain Nondisclosure Agreement dated as of March 19, 2001 as amended August 5, 2002 between the Parties shall remain in effect.

B. Each Party (the Recipient Party) agrees to hold in confidence and not to disclose either directly or indirectly to any third party any technical, financial, commercial or other information (the Information) as may be revealed or disclosed orally, in writing or otherwise to it by the other Party or by the Joint Venture (the Disclosing Party) and shall refrain from using any such Information for any purpose whatsoever other than for the purpose(s) for which the Information was disclosed or unless previously approved in writing by the Disclosing Party; provided, however, that these obligations shall not apply to Information:





(i) which at the time of disclosure to the Recipient Party was in the public domain,

(ii) which after disclosure to the Recipient Party becomes part of the public domain through no fault of said Party,

(iii) which at the time of disclosure to the Recipient Party was in its possession or was independently developed by the Recipient Party (and the Recipient Party can demonstrate such by written documents dated before the time of disclosure),

(iv) which disclosure is obtained by the Recipient Party from a third party which has not, either directly or indirectly, received the Information from the Disclosing Party; or

(v) which disclosure is required otherwise by law, unless compelled to disclose such documents or information by judicial or administrative process.

Specific Information shall not be deemed to be within the foregoing exceptions merely because such specific Information may be construed as being within broader, non- confidential information which is either in the public domain or in the possession of the Receiving Party at the time of the disclosure of such Information, nor shall a combination of features which form Information be deemed to be non-confidential merely because the individual features, without being combined, are non-confidential. In any such instance where disclosure appears to be compelled by law, the first Party will notify the other Party so that such Party may avail itself of such measures as may be available for protecting the confidentiality of such information; provided, however, that neither Party will be prohibited from using such documents and information in litigation against the other Party.

C. The Parties shall cause the Operating Company and the Manufacturing Company to adhere to similar obligations of confidentiality as set forth above with respect to Information received by it from either Party.

D. Unless otherwise agreed between the Parties, the provisions of this clause shall survive the termination of this Agreement and continue to be in force thereafter for a period of five (5) years.

21.5. COUNTERPARTS. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument. Signatures to this Agreement may be given by facsimile or other electronic transmission, and such signatures shall be fully binding on the Party sending the same.

21.6. AMENDMENT; WAIVER; HEADINGS. No waiver, modification or amendment of any provision, term, or condition of this Agreement shall be of any force or effect unless in writing and executed by each of the Parties. No usage of trade, course of dealing or performance shall modify the terms or conditions of this Agreement. The headings in this Agreement are for convenience only and shall not be deemed a part of this Agreement.

21.7. AUDITORS. The Parties will agree on the independent auditors of the Joint Venture. From time to time, each Party shall have the right to have its own internal or external auditors review the books and records of the Joint Venture.

21.8. SUPREMACY. Other than as set forth in this Agreement to the contrary, in the event of any conflict or inconsistency between the provisions of this Agreement and any other document related to the subject matter of this Agreement, which may be entered into by the Parties or between a member of any Party and the Joint Venture, from time to time, the provisions of this Agreement shall prevail in each case, unless the Parties otherwise expressly agree in writing.

21.9. TAX MATTERS. Each Party shall prepare its tax reports and returns in a manner not inconsistent with the tax reports and returns of the Operating Company, except in the case of manifest error.

21.10. GUARANTEE. Parent hereby guarantees the performance by T&L of all of its obligations hereunder.

22. DISPUTE RESOLUTION PROCEDURES; LIQUIDATION.

22.1. At any time for so long as both T&L and Igene own an interest in the Operating Company, at the request of either Party in a written notice to the other Party's appointees to the Board, the Parties agree to negotiate in good faith to resolve expeditiously any controversies, claims or disputes between the Parties that may arise from time to time under this Agreement or otherwise relating to the Joint Venture (each a Board Dispute). If, after a Board Dispute is addressed and recorded in the minutes in two regular





quarterly Board meetings without resolution of such Board Dispute, then any such matter not so resolved shall be referred (by written notice by either Party to the other Party's general counsel and the other Party's appointees to the Board) to the Party Heads, who shall have an initial meeting with respect to such matters within ten days of the date of such referral notice, and who shall thereafter negotiate in good faith with each other for an additional twenty day period following the date of such initial meeting in an attempt to resolve any open issues.

22.2. If any Board Dispute is not resolved through the procedure set forth in Article 22.1 after expiration of all of the time specified therefor, either Party, in the thirty day period beginning upon the end of the twenty day period described in Article 22.1, may provide the other Party with a written notice (the Offer Notice) stating that such Board Dispute is not resolved and setting forth a price (the Offer Price) and a list of three acceptable closing dates not less than ninety days after the expiration of the twenty-one day period referred to in the next sentence; provided, that an Offer Notice may not be served earlier than (i) with respect to a Board Dispute arising pursuant to Article 9.5(a) (General Manager Appointment), 9.5(k) (Operating Plans) (except as provided in subclause (ii) below), eighteen months from the Commencement Date, (ii) a Board Dispute arising pursuant to Article 9.5(b) (Capital Expenditures) or 9.5(k) (Operating Plans) that involves a contemplated expenditure which can be financed solely by the Joint Venture from its internal resources and/or using funds provided on normal commercial terms by any other party without any contribution or guaranty from either Party, eighteen months from the Commencement Date and (iii) with respect to any other Board Dispute, fifty-four months from the Effective Date. Upon receipt of an Offer Notice, the other Party must elect prior to the expiration of twenty-one days either to (a) sell its interest in the Operating Company for the Offer Price or (b) purchase the interest of the Party providing the Offer Notice for the Offer Price, which election in either case may be in a written notice which also specifies which of the closing dates identified in the notice delivered to such Party is preferred by such Party. On the closing date specified in the response notice, the Parties shall consummate the transaction selected in the response notice unless both Parties expressly agree otherwise. The Party initiating the notice provided herein, shall be required to provide such Support Services as agreed in the appropriate Support Services Agreement described in Article 11.1 to the surviving entity at a price (that shall be reasonably consistent with the methodology used for determining prices prior to such conveyance) to be agreed upon by the Parties for a transition period to allow the Operating Company to continue to obtain such services. Such transition period shall not exceed 12 months for the services set forth in Article 11.1.1 and Article 11.1.2 and shall not exceed 24 months for the services set forth in Article 11.1.4. The Party whose interest in the Operating Company is purchased shall take all reasonable steps to cooperate in the transition with the other Party so that the Joint Venture will be able to continue as an independent and functioning business after termination of the Support Services. For all purposes under this Article 22.2, if each Party delivers an Offer Notice to the other Party, the Offer Notice that is received on the earliest date shall be effective. If each Party receives an Offer Notice from the other Party on the same date, then the Offer Notice containing the highest cash Offer Price shall be effective.

22.3. In the event the Parties (a) agree to liquidate the Joint Venture, (b) are required to liquidate the Joint Venture pursuant to Article 12.2 or (c) do not send any notice under Article 22.2 in the period allowed therefor, either Party may, by notice to the Board of such circumstance (the Liquidation Notice), commence the following liquidation process. Upon the Board's receipt of a Liquidation Notice, the Board shall meet to determine how to proceed. The Board may retain or appoint a Qualified Expert or any other person to value the Joint Venture and to advise it in liquidating the Joint Venture. Each Party may also retain or appoint such advisors and experts as it may deem appropriate to advise such Party with respect to the liquidation of the Joint Venture. From and after the Board's receipt of a Liquidation Notice, the Board shall proceed with the liquidation of the Joint Venture, and shall have no authority and shall not continue the regular operations of the Joint Venture except to the extent necessary or appropriate to preserve or increase the value of the assets of the Joint Venture; provided that, the Board may elect to, and upon express election by the Board thereby shall, for a specified period not to exceed six months, continue regular operations of the Joint Venture solely for the purpose of preserving its value while seeking to sell the Joint Venture as a whole, but if such period expires prior to the sale of the Joint Venture as a whole, the Board shall thereafter be required to sell the assets of the Operating Company reasonably expeditiously. The proceeds of any such liquidation shall be first used to pay the fees and expenses of the Qualified Experts and all remaining proceeds after payment of such fees shall be distributed between the Parties in proportion to their respective capital accounts.

23. JOINT VENTURE TO BE BOUND.

On the Formation Date, each of the Parties shall cause the Joint Venture (and each of its constituent entities) to agree to and be irrevocably bound by the terms and provisions of this Agreement, including, without limitation, Article 13.

[remainder of page intentionally left blank]

IN WITNESS of the foregoing, the Parties have signed this Agreement as to the date first written above.

TATE & LYLE FERMENTATION PRODUCTS LTD. IGENE BIOTECHNOLOGY, INC.

/s/





/s/

By:

Its:

Agreed and accepted for purposes of Section 21.10 hereof only:

TATE & LYLE INDUSTRIES LTD.

/s/

By:

Its:

By:

Its: 
Question: Highlight the parts (if any) of this contract related to Third Party Beneficiary that should be reviewed by a lawyer. Details: Is there a non-contracting party who is a beneficiary to some or all of the clauses in the contract and therefore can enforce its rights against a contracting party?
answer:
Except as expressly stated herein with respect to members of each Party, no person or entity not a Party to this Agreement (including, without limitation, any employee of either Party or the Joint Venture) shall be a third-party beneficiary of any provision of this Agreement, and nothing contained herein shall be construed or deemed to confer any benefit or right upon any third party.


question:
Exhibit 10.4

Execution Version

GAS TRANSPORTATION AGREEMENT

This Gas Transportation Agreement (this Agreement) is hereby made and entered into on the 14t h day of April, 2015 (the Effective Date) by and between PennTex North Louisiana Operating, LLC, a Delaware limited liability company (Transporter), and MRD Operating LLC, a Delaware limited liability company (Customer). Hereinafter, Transporter and Customer may sometimes be referred to collectively as the Parties and individually as a Party.

WITNESSETH

WHEREAS, Transporter owns and operates a natural gas transportation system and related facilities; and

WHEREAS, Customer owns or controls, and has the right, to deliver Gas (as hereinafter defined) for transportation and desires to have Transporter provide such service under the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the Parties covenant and agree as follows:

Article I. Definitions

For the purposes of this Agreement, the following definitions have the meanings as set forth below:

Affiliate shall mean, when used with respect to any Person, any other Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with such Person. For this purpose, control of any Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, by ownership of voting interest, by contract or otherwise. For the purposes of this Agreement, (i) with respect to PennTex Midstream Partners, LLC and its subsidiaries, the term Affiliate shall exclude Memorial Resource Development Corp. and each of its subsidiaries and (ii) with respect to Memorial Resource Development Corp. and its subsidiaries, the term Affiliate shall exclude PennTex Midstream Partners, LLC and each of its subsidiaries.

AMI/MEA Agreement shall mean that certain Amended and Restated Area of Mutual Interest and Midstream Exclusivity Agreement dated April 14, 2015 among PennTex North Louisiana, LLC, Customer, PennTex NLA Holdings, LLC and MRD WHR LA Midstream LLC, as such agreement may be amended, supplemented or otherwise modified from time to time.

Btu shall mean one British thermal unit, the amount of heat required to raise the temperature of one pound of water one degree Fahrenheit at standard reference conditions.

Business Day shall mean any day (other than a Saturday or Sunday) on which commercial banking institutions in Houston, Texas are generally open for business.

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Cash-out Price shall have the meaning set forth for such term in Article IV.

Central Clock Time shall mean the current time in the Central Time Zone taking into consideration the seasonal changes back and forth between Daylight Savings and Standard time.

Commencement Date shall be the first day of the Month following the date Transporter notifies Customer that (i) the Transportation System is operational to the extent necessary to commence commercial service with respect to the receipt of Customer Gas at the Point of Receipt at the tailgate of the Lincoln Parish Plant and delivery of such Gas to the Points of Delivery located downstream of the Lincoln Parish Plant, (ii) the Lincoln Parish Plant is operational to the extent necessary to commence commercial service with respect to the receipt and processing of Customer Gas, and (iii) the Points of Delivery listed on Exhibit A that are owned by Transporter or its Affiliate are operational and all necessary interconnect agreements with Interconnecting Pipelines necessary to deliver Gas to such Points of Delivery are in effect to the extent necessary to commence commercial service with respect to the delivery (but, for the avoidance of doubt, not the further downstream transportation) of Customer's Gas. Transporter will not be responsible for delays to the Commencement Date due to the action or inaction of Customer or Third Party Operators.

Commencement Date Facilities shall have the meaning given to such term in Article II.

Contract Year shall mean a period commencing at 9:00 a.m., Central Clock Time, on the Commencement Date and ending at 9:00 a.m., Central Clock Time on the same day and calendar month of the following calendar year and thereafter for succeeding periods of twelve (12) consecutive Months each.

Customer shall have the meaning given to such term in the preamble of this Agreement.

Customer's Firm Service Gas shall mean, an amount of Customer Gas equal to 400,000 MMBtu per Day; provided, however, (y) Customer's Firm Service Gas shall be increased by the additional amount of Transportation System capacity provided pursuant to a New Facility, and (z) if any Plant described in clause (iii) of the definition of Plants exists, Customer's Firm Service Gas shall be increased by the amount of Gas Customer is committed to deliver to such Plant.

Customer Gas shall mean Gas delivered by or on behalf of Customer for transportation on the Transportation System pursuant to this Agreement.

Day or Daily shall mean a period of hours, commencing at 9:00 a.m., Central Clock Time, on a calendar day and ending at 9:00 a.m., Central Clock Time, on the next succeeding calendar day.

Default Interest Rate shall mean the U.S. Prime Rate (as published in the Money Rates table of The Wall Street Journal, Eastern Edition) applicable on the first Business Day prior to the due date of payment and thereafter on the first Business Day of each succeeding calendar month (or, if such rate exceeds the maximum permissible rate under applicable law, the maximum rate permitted by such applicable law).   2

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Effective Date shall have the meaning given to such term in the preamble of this Agreement.

Equivalent Quantities shall mean, on any Day, a quantity of Gas (expressed in MMBtu) that has a Thermal Content equal to the Thermal Content of Customer Gas received from Customer at the Points of Receipt on that Day, less the Thermal Content of System Fuel & LUAF allocated to such Customer Gas for such Day.

Firm Service shall mean service for which Transporter is contractually entitled to interrupt its performance only to the extent (i) that such performance is excused pursuant to the provisions of this Agreement relating to Force Majeure, (ii) of specified periods of maintenance, or (iii) that Transporter determines that the operation of all or any portion of its facilities will cause injury or harm to persons or property or to the integrity of its facilities, and with respect to each of (i), (ii) or (iii), only to the extent that Transporter has curtailed all service of the same priority on a pro rata basis in accordance with Article V.

Firm Service Gas shall mean all Gas entitled to Firm Service on the Transportation System, including, without limitation, Customer's Firm Service Gas.

Force Majeure shall have the meaning given to such term in Article X.

Gas shall mean any mixture of gaseous hydrocarbons, consisting essentially of methane and heavier hydrocarbons and inert and noncombustible gases that are extracted from the subsurface of the earth.

Governmental Authority shall mean any federal, state, local, municipal, tribal or other government; any governmental, regulatory or administrative agency, commission, body or other authority or entitled to any administrative, executive, judicial, legislative, regulatory or taxing authority or power; and any court or governmental tribunal, including any tribal authority having or asserting jurisdiction.

Gross Heating Value shall mean the number of Btus produced by the complete combustion in air, at constant pressure of one (1) cubic foot of Gas, at a base temperature of sixty degrees Fahrenheit (60°F) and at a reference pressure base equal to 14.65 psia, with air of the temperature and pressure of the Gas, after the products of combustion are cooled to the initial temperature of the Gas, and after the air and water formed by the combustion is condensed to the liquid state. The gross heating value of the Gas shall be corrected for water vapor under testing conditions to the actual water vapor content of the Gas being delivered; provided, however, if the actual water vapor content is seven (7) pounds per 1,000,000 standard cubic feet of Gas or less, the Gas shall be deemed dry and no water vapor correction shall be made.

Imbalance shall have the meaning set forth for such term in Article IV.

Interconnecting Pipelines means any pipeline connected to the Transportation System for the further transportation of Gas downstream of the Transportation System.   3

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Interruptible Service shall mean service for which Transporter is contractually entitled to interrupt its performance for any reason, including, without limitation, (i) the overall demand for services in the applicable facilities exceeding Transporter's capacity therein, (ii) an event of force majeure, (iii) maintenance or (iv) Transporter determines that the operation of all or any portion of its facilities will cause injury or harm to persons or property or to the integrity of its facilities.

Interruptible Service Gas shall mean all Gas received by Transporter into the Transportation System that is not Firm Service Gas.

Lincoln Parish Plant shall mean Transporter's gas processing plant located in Lincoln Parish, Louisiana.

Mcf shall mean one thousand cubic feet of Gas at standard base conditions of 60°F and 14.73 psia.

Measurement Facility shall mean the valves, fittings, piping, meters, transmitters and other associated measurement equipment located at a Point of Receipt or a Point of Delivery which provides custody transfer volumes. Measurement Facilities shall mean, collectively, each such Measurement Facility.

MMBtu shall mean one million (1,000,000) Btus.

Month or Monthly shall mean a period of time beginning at 9:00 a.m., Central Clock Time on the first Day of the calendar month and ending at 9:00 a.m., Central Clock Time on the first Day of the next succeeding calendar month.

Mount Olive Plant shall mean Transporter's gas processing plant located in Mount Olive, Lincoln Parish, Louisiana that is Transporter's next gas processing plant constructed after the Lincoln Parish Plant.

Negative Imbalance shall have the meaning set forth for such term in Article IV.

New Facility shall have the meaning set forth for such term in Article II.

Parties shall have the meaning given to such term in the preamble of this Agreement.

Party shall have the meaning given to such term in the preamble of this Agreement.

Performance Assurance shall have the meaning given to such term in Article XIV.

Person shall mean any individual or any corporation, company, partnership, limited partnership, limited liability company, trust, estate, Governmental Authority or other entity.

Plants shall mean (i) the Lincoln Parish Plant, (ii) the Mount Olive Plant and (iii) any other gas processing plant owned by Transporter or its Affiliate that is capable of receiving Customer Gas and redelivering such Gas to the Transportation System.   4

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Point of Delivery shall mean the custody transfer meter at the outlet of Transporter's facilities at the point of interconnection between the Transportation System and Interconnecting Pipelines or other facilities. Points of Delivery shall mean, collectively, each Point of Delivery. As of the Effective Date, the Points of Delivery, and the maximum available capacity thereof, are set forth on Exhibit B.

Point of Receipt shall mean each custody transfer meter at the tailgate of the Plants from which Customer Gas is received into the Transportation System. Points of Receipt shall mean, collectively, each Point of Receipt. As of the Effective Date, the Points of Receipt, and the maximum available capacity thereof, are set forth on Exhibit B.

Positive Imbalance shall have the meaning set forth for such term in Article IV.

Service Type shall mean the type of service provided for Gas delivered hereunder, either Firm Service or Interruptible Service.

Services shall mean the transportation and, if applicable, compression services provided by Transporter to Customer hereunder.

System Fuel & LUAF shall mean, for any period of calculation, (i) Customer's share of Gas or fuel equivalents (electricity or other energy sources converted to their Btu equivalent) used by Transporter to deliver Customer's Gas from the Point(s) of Receipt to the Point(s) of Delivery on the Transportation System during such period, and (ii) Gas lost and unaccounted for on the Transportation System during such period.

Taxes shall mean any or all current or future taxes, fees, levies, charges, assessments and/or other impositions levied, charged, imposed, assessed or collected by any Governmental Authority having jurisdiction. For the avoidance of doubt, the term Taxes shall not include any current or future taxes, fees, levies, charges, assessments and/or other impositions levied, charged, imposed, assessed or collected with respect to the Transportation System or any of Transporter's other facilities, including without limitation, Transporter's natural gas processing plants.

Term shall have the meaning given to such term in Article XV.

Thermal Content means, with respect to Gas, the product of (i) a volume of Gas and (ii) the Gross Heating Value of such Gas, adjusted to a same pressure base of 14.73 psia, as expressed in MMBtus.

Third Party Operator means an operator of a pipeline or other facility upstream or downstream of the Transportation System, other than Transporter or its Affiliates.

Transportation Fee shall have the meaning given such term in Article VIII.

Transportation System shall mean the Commencement Date Facilities and all other equipment, devices, Measurement Facilities, pipelines and other facilities owned or operated by Transporter at or downstream of the Points of Receipt, necessary to receive Customer Gas at the Points of Receipt for transport to the Points of Delivery, and all additions, modifications, alterations, replacements, extensions, or expansions made thereto by Transporter from time to time, including, without limitation, any New Facilities pursuant to Article II hereof.   5

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Transporter shall have the meaning given to such term in the preamble of this Agreement.

Article II. Dedication, Commencement Date Facilities, Post-Commencement Date Facilities and Transporter Services

Dedication. During the Term, subject to the terms of the AMI/MEA Agreement, Customer dedicates and commits to this Agreement, and shall deliver or cause to be delivered to the Transportation System for transportation hereunder, all of Customer's owned or controlled residue Gas delivered from any of the Plants. Notwithstanding anything in this Agreement to the contrary, it is acknowledged and agreed that there is no minimum amount of residue Gas that must be delivered to the Transportation System hereunder; accordingly, Customer shall not have any liability (financial or otherwise) for failure to deliver any particular quantity of residue Gas to Transporter; provided, however, the foregoing sentence shall not reduce or eliminate Customer's obligation to pay the fees provided herein to the extent Services are provided hereunder.

Commencement Date Facilities. Transporter shall design, engineer, modify, construct and equip, or caused to be designed, engineered, modified, constructed and equipped, the Transportation System, including, without limitation, the facilities and equipment described on Exhibit A attached hereto (the facilities and equipment described on Exhibit A being collectively referred to as the Commencement Date Facilities).

Post-Commencement Date Facilities.

If after the Commencement Date, Customer requires an addition, modification, alteration, replacement, or expansion of the Transportation System (a New Facility), Customer will provide Transporter a written notification of such requested New Facility containing sufficient information for Transporter to estimate the cost to provide such New Facility. Although Transporter shall have no obligation to provide a requested New Facility, Transporter may, in its sole discretion, agree to construct or acquire such New Facility. The commercial terms applicable the construction or acquisition of any New Facility will be determined in accordance with the AMI/MEA Agreement. The Parties agree to make any revisions to this Agreement (including the Exhibits hereto) that are necessary to reflect any New Facility.

Transportation Services. For each Day during the Term, (i) Transporter agrees to provide Firm Service on the Transportation System for Customer Gas delivered to the Transportation System in a quantity not to exceed Customer's Firm Service Gas for such Day, and Interruptible Service for all quantities in excess of Customer's Firm Service Gas for such Day, and deliver to Customer, or for the account of Customer, at the applicable Points of Delivery, Equivalent Quantities of Customer Gas received at the Points of Receipt, and (ii) Customer, or its designee, shall accept such Equivalent Quantities of Customer Gas at the Points of Delivery.   6

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Notwithstanding anything in this Agreement to the contrary, it is acknowledged and agreed that there is no minimum amount of Customer Gas that must be delivered to the Transportation System hereunder; accordingly, Customer shall not have any liability (financial or otherwise) for failure to deliver any particular quantity of Gas to Transporter; provided, however, the foregoing sentence shall not reduce or eliminate Customer's obligation to pay the fees provided herein.

Article III. Receipt and Delivery Pressures

Pressure at Point of Receipt. Transporter will receive Customer Gas at the prevailing pressure at which such Customer Gas is delivered to the applicable Point of Receipt by the operator of the applicable Plant.

Pressure at Point of Delivery. All Customer Gas delivered by Transporter will be delivered at the prevailing pressures of the Transportation System as may exist from time to time. Transporter shall at no time be required, unless otherwise agreed in writing, to construct New Facilities or modify the Commencement Date Facilities, including by the addition of compression facilities, to effect such delivery, including, but not limited to, instances in which a facility downstream of a Point of Delivery operates at a pressure in excess of the Transportation System working pressure. For the avoidance of doubt, any New Facilities required by Customer to comply with the operating pressure of facilities located downstream of a Point of Delivery shall be subject to the provisions of Article II.

Article IV. Nominations, Confirmations and Imbalances

Nominations. Each Month during the Term, Customer shall give written notice of Customer's nomination to Transporter specifying the average daily quantity of Customer Gas Customer requests be transported during such Month and designate a person who will be responsible for coordinating notices among Customer, Transporter and Third Party Operators in accordance with these procedures. Customer shall furnish such nomination to Transporter by email or other electronic means and such nomination shall specify such information as is necessary in order to perform the Services requested by Customer. If Customer anticipates any material revision to a Monthly nomination it has provided to Transporter, Customer will notify Transporter as promptly as possible. Transporter will transport hereunder as nearly as practicable at uniform hourly and Daily rates of flow unless otherwise mutually agreed by Customer and Transporter.

Unless otherwise mutually agreed by Customer and Transporter, for Customer's initial nomination to be accepted for the first (1st) Day of any Month, Customer's nomination must be received by Transporter by 11:30 a.m. Central Clock Time on the third (3rd) Business Day prior to the last Day of the Month preceding such Month. Customer shall have the right to submit a new nomination or revise its existing nomination for any Day during such Month provided such nomination is received by Transporter prior to 11:30 a.m. Central Clock Time on the Business Day prior to the Day such new or revised nomination is requested to commence. Customer nominations received by Transporter after 11:30 a.m. Central Clock Time on the Business Day prior to the Day such new or revised service is requested to commence, or intraday nominations   7

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





for Gas flowing the same Day, may be accepted by Transporter, in its sole discretion. Such new or revised nomination shall specify Customer's anticipated service requirements for the remainder of the applicable Month.

If Customer is advised by a Third Party Operator to reduce or suspend deliveries of Customer Gas to the Transportation System, Customer shall immediately notify Transporter orally of such reduction or suspension, and shall confirm such notification in writing, and adjust its nominations in order to maintain a balanced position to the extent possible.

Confirmations. All nominations of Customer Gas shall be scheduled and implemented by Transporter on a prospective basis and only to the extent Transporter is able to confirm the receipt and delivery of such Gas with the operator(s) of the Point(s) of Delivery. If a conflict arises between Customer's new or revised nomination and an operator's confirmation, Customer understands and agrees such operator's confirmation shall control. If Customer submits a new or revised nomination to Transporter, Transporter will confirm the scheduled quantity to Customer by 3:00 Central Clock Time on the Business Day prior to the Day such new or revised nomination is requested to commence, except for intraday nominations for Gas flowing the same Day, which Transporter will confirm as soon as reasonably practicable.

Commingling. Although Customer shall retain title to Customer Gas delivered to Transporter hereunder, Customer Gas shall constitute part of the supply of Gas from all sources, and as such, Transporter shall, subject to its obligation to deliver Equivalent Quantities each Day, have the right to commingle Customer Gas with Gas of other customers. Transporter shall allocate Customer's pro rata share of each NGL Component contained in any commingled stream of Gas at any Point(s) of Delivery based on the GPMs of each NGL Component contained in Customer's Gas as measured by chromatograph or other method acceptable in the industry at the Point(s) of Receipt.

Imbalances. The term Imbalance means the cumulative difference in a Month between: (i) the quantity of Gas in MMBtu received for the account of Customer at the Point(s) of Receipt, less Customer's System Fuel & LUAF quantity, as applicable, and (ii) the quantity of Gas in MMBtu delivered for the account of Customer at the Point(s) of Delivery. After any adjustment for System Fuel & LUAF, if the Imbalance is the result of receipts at the Point(s) of Receipt exceeding the delivered (or scheduled, as applicable) quantity of Gas for Customer's account at the Point(s) of Delivery, it is a Positive Imbalance. If the Imbalance is a result of receipts at the Point(s) of Receipt being lower than the delivered quantity of Gas for Customer's account at the Point(s) of Delivery, it is a Negative Imbalance. Imbalances will be cashed out on a Monthly basis.   8

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Cash Out. The cash-out settlement price will be the monthly arithmetical average of the prices (Cash-out Price) as posted in Gas Daily's Daily Price Survey during the Month under the heading Texas Gas Transmission Corp., under the column labeled Index corresponding to the row labeled Zone 1. Transporter will pay Customer an amount that is the product of the Positive Imbalance each Month, if any, and the Cash-out Price. Customer will pay Transporter an amount that is the product of the Negative Imbalance each Month, if any, and the Cash-out Price. If the actual monthly volume varies by more than five percent (5%) from the delivered volumes for the Month, then the Cash-out Price will be adjusted as follows:



1. For Negative Imbalances, the Cash-out Price will be increased by the percentage variance, rounded up to the nearest whole percentage point, between the Point(s) of Delivery volumes and the adjusted Point(s) of Receipt volumes. (i.e., if the adjusted receipt volume from Customer is 7% less than the Point(s) of Delivery volume, then the Index Price will be increased by 7%), however in no event shall the Cash-Out Price be increased more than 10%; and



2. For Positive Imbalances, the Cash-out Price will be decreased by the percentage variance, rounded up to the nearest whole percentage point, between the Point(s) of Delivery volumes and the adjusted Point(s) of Receipt volumes. (i.e., if the adjusted receipt volume from Customer is 7% greater than the Point(s) of Delivery volume, then the Index Price will be increased by 7%), however in no event shall the Cash-Out Price be increased more than 10%.

Article V. Curtailment

If the quantity of Customer Gas and all other Gas available for delivery into the Transportation System exceeds the capacity of the Transportation System at any point, then Transporter shall interrupt or curtail receipts of Customer Gas with respect to the affected point(s) only in accordance with the following:

(a) First, Transporter shall curtail all Interruptible Service Gas prior to curtailing Firm Service Gas. In the event Transporter curtails some, but not all, Interruptible Service Gas on a particular Day, Transporter shall allocate the capacity of the Transportation System available for Interruptible Service Gas at the affected points on a pro rata basis based upon Customer's last confirmed nomination of Interruptible Service Gas hereunder and the last confirmed nominations of Interruptible Service Gas from all other shippers on the Transportation System prior to the event causing the curtailment.

(b) Second, if additional curtailments are required beyond those described in the immediately preceding clause (a), Transporter shall curtail Firm Service Gas. In the event Transporter curtails some, but not all, Firm Service Gas on a particular Day, Transporter shall allocate the capacity of the Transportation System at the affected point(s) on a pro rata basis based upon Customer's last confirmed nomination of Firm Service Gas hereunder and the last confirmed nominations of Firm Service Gas from all other shippers on the Transportation System prior to the event causing the curtailment.

Transporter shall provide Customer notice of any interruption or curtailment of the receipt of Customer Gas into the Transportation System as is reasonable under the circumstances.

Article VI. Measurement & Testing

The construction, ownership, installation, operation and maintenance of each Measurement Facility that is owned by a Person other than Transporter shall be governed by an interconnect agreement between Transporter and such Person. Each other Measurement Facility shall be constructed, installed, owned, operated and maintained by Transporter.   9

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Article VII. Gas Quality

Notwithstanding anything to the contrary in this Agreement, Customer Gas received at a Point of Receipt from one of the Plants shall be deemed to be in compliance with the applicable Gas quality specifications of the Transportation System.

Article VIII. Fees, Billing & Payment

Fees.

(a) Transportation Fee. For all Customer Gas received by Transporter at a Point of Receipt and delivered to any Point of Delivery, Customer shall pay Transporter a transportation fee of $0.04 per MMBtu.

(b) Other Services Fees. If Transporter provides any compression Services with respect to Customer Gas delivered hereunder, the fees applicable to such Services shall be as mutually agreed between the Parties. The Parties agree to supplement this Agreement with an addendum or other mutually agreeable modification to memorialize the terms applicable to the provision of any such additional Services.

Invoices and Statements. On or before the fifteenth (15th) calendar Day of each Month, Transporter shall provide to Customer an invoice and statement for the previous Month setting forth the calculation of the net amount due hereunder to Transporter for the Services provided hereunder during such previous Month.

Payment of Statements. Within fifteen (15) calendar Days following receipt of each of Transporter's invoices and statements, Customer shall make payment to Transporter of all undisputed amounts by wire transfer, in accordance with the account information provided to Customer, unless another form of payment is agreed to in writing by the Parties. Should Customer fail to make payment in full of all undisputed amounts within such time period, interest shall accrue on the unpaid balance at the Default Interest Rate or the maximum legal rate, whichever is the lesser, from the date such payment is due until the same is paid. If Customer fails to pay Transporter undisputed amounts due hereunder and such failure is not cured within ten (10) calendar Days' of written notice from Transporter to Customer, Transporter may suspend receipt and delivery of Customer Gas without prejudice to any other available remedies at law or in equity.   10

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Billing Disputes. If a good faith dispute arises as to any amount payable hereunder, payment shall nevertheless be made when due of the amount not in dispute. Such payment shall not be deemed to be a waiver of the right to recoup any overpayment. If Customer withholds payment of any disputed amount, Customer shall, within seven (7) calendar Days after receipt of the statement for the month to which the disputed amount pertains, submit to Transporter a written explanation of the dispute and any available supporting documentation. The Parties shall then cooperate in good faith to resolve such dispute as expeditiously as possible.

Audit Rights. Each Party or its designated representatives shall, upon reasonable notice to the other Party, have the right, no more frequently than two (2) times per twelve (12) consecutive calendar Months, at its own expense, at reasonable times and during normal business hours, to examine the books and records of such other Party to the extent necessary to verify the accuracy of any statement, charge, computation, or demand made under or pursuant to this Agreement. Each Party agrees to keep its records and books in accordance with generally accepted accounting practices in the oil and gas industry. Each invoice and statement shall be final as to both Parties unless questioned in writing within twenty four (24) Months following the date of such invoice or statement.

Article IX. Notices

Any notice, statement, claim or other communication required or permitted hereunder shall be in writing and shall be sent by: (i) hand delivery; (ii) United States mail with all postage fully prepaid; or (iii) courier with charges paid in accordance with the customary arrangements established by such courier, in each of the foregoing cases addressed to the Party at the following addresses, and shall be deemed given when received by the Party to whom it is addressed. The Parties opt out of electronic delivery of notices and amendments under this Agreement, except as to nominations, scheduling and imbalances, and except that this executed Agreement and executed amendments hereto may be delivered by scanning and emailing.

Transporter:

Notices and Correspondence:

PennTex North Louisiana, LLC c/o PennTex North Louisiana Operating, LLC 11931 Wickchester Lane, Suite 300 Houston, Texas 77043 Attn: Steve Moore E-mail: smoore@penntex.com

Customer:

Notices and Correspondence:

MRD Operating LLC c/o Memorial Resource Development Corp. 500 Dallas Street, Suite 1800 Houston, TX 77002 Attn: General Counsel E-mail: kroane@memorialrd.com   11

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





with a copy to:

Attn: Jeremy Bolander E-mail: Jeremy.bolander@memorialrd.com

Notices of change of address of either of the Parties shall be given in writing to the other Party in the manner aforesaid and shall be observed in the giving of all future notices, statements, payments, claims or other communications required or permitted to be given hereunder.

Article X. Force Majeure

The term Force Majeure as used herein shall mean acts of God; strikes, lockouts, or other industrial disturbances; conditions arising from a change in governmental laws, orders, rules, or regulations; acts of public enemy; wars; blockades; insurrections; riots; epidemics; landslides; lightning; earthquakes; fires; storms; floods; washouts; arrests and restraints of governments and people; civil disturbances; explosions; breakage or accident to machinery or lines of pipe; the necessity for making repairs, tests, alterations, or performing maintenance to machinery or lines of pipe; scheduled maintenance; freezing of wells or lines of pipe; partial or entire failure of wells, processing, or gasification and gas manufacturing facilities; orders or directives of, or proceedings initiated by, any Governmental Authority; and any other causes, whether of the kind herein enumerated or otherwise, not within the control of the Party claiming relief hereunder, and which by the exercise of due diligence, such Party is unable to prevent or overcome. Such term shall likewise include those instances (a) where either Transporter or Customer is required to obtain servitudes, rights-of-way, grants, permits or licenses to enable such Party to fulfill its obligations under this Agreement and is unable to acquire or experiences delays in acquiring such servitudes, rights-of-way, grants, permits or licenses, at reasonable costs, and after the exercise of reasonable diligence, and (b) the partial or entire failure or refusal of Third Party Operators to receive or deliver Gas, or increases in pressure of upstream or downstream pipelines. Force Majeure shall not include failure of Gas supply due to pricing considerations.

In the event Transporter or Customer is rendered unable, wholly or in part, by reason of force majeure to carry out its obligations under this Agreement (other than the obligation to make payment of amounts due hereunder, including without limitation, payment of fees due hereunder), it is agreed that such Party shall give notice and reasonably full particulars of such force majeure, in writing, or other electronic means to the other Party within a reasonable time after the occurrence of the cause relied on, and the obligations of the Party giving such notice, so far as they are affected by such force majeure, shall be suspended during the continuance of any inability so caused, but for no longer period, and such cause shall, so far as possible, be remedied with all reasonable dispatch.

It is understood and agreed that the settlement of strikes or lockouts shall be entirely within the discretion of the Party having the difficulty, and that the above requirement that any force majeure shall be remedied with all reasonable dispatch shall not require the settlement of strikes or lockouts by acceding to the demands of the opposing party when such course is inadvisable in the discretion of the Party having the difficulty.   12

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Article XI. Warranties

Customer warrants to Transporter that at the time Customer Gas is delivered to a Point of Receipt hereunder, Customer will have good title or the right to deliver such Customer Gas, and that such Customer Gas shall be free and clear of all liens and adverse claims, other than statutory liens and liens, encumbrances or claims under credit facilities or other credit arrangements in respect of borrowed money. Customer agrees, with respect to the Customer Gas delivered to Transporter hereunder, to indemnify Transporter against all suits, actions, debts, accounts, damages, costs (including attorney's fees), losses and expenses arising from or out of any adverse claims of any and all persons to or against said Customer Gas other than any lien, claim or encumbrance alleged to have arisen by, through or under Transporter or its Affiliate.

Article XII. Taxes and Surcharges

Customer shall pay, or cause to be paid, all production, severance, gross receipts, ad valorem, and similar Taxes, and all surcharges, levied or imposed on it by any Governmental Authority with respect to Customer Gas. In the event Transporter is required to pay or remit any such Tax or surcharge owed by Customer as a result of Customer Gas being transported on the Transportation System, Customer shall reimburse Transporter for such Tax or surcharge pursuant to Transporter's invoice for the same. Customer hereby agrees to indemnify, defend and hold harmless Transporter from and against any and all claims and losses arising out of or related to such Taxes or surcharges. This indemnity and defense obligation shall survive the expiration or termination of this Agreement. Transporter shall be responsible for all Taxes or surcharges levied or imposed on it by any Governmental Authority with respect to the Transportation System and Transporter's other facilities, including without limitation, Transporter's Gas gathering system, processing plants and Gas liquids pipeline system.

Article XIII. Limitation of Liability & Indemnifications

CUSTOMER SHALL RELEASE, DEFEND, INDEMNIFY AND HOLD HARMLESS TRANSPORTER AND TRANSPORTER'S MEMBERS, DIRECTORS, OFFICERS, AGENTS AND EMPLOYEES FROM AND AGAINST ANY AND ALL SUITS, ACTIONS, CAUSES OF ACTION, CLAIMS, DEMANDS, LOSSES, LIABILITIES AND EXPENSES (INCLUDING, WITHOUT LIMITATION, INTEREST, COURT COSTS, REASONABLE ATTORNEYS' FEES AND EXPENSES, AND OTHER COSTS OF DEFENSE) (COLLECTIVELY, CLAIMS) RELATING TO, CAUSED BY OR ARISING OUT OF CUSTOMER'S BREACH OF ANY REPRESENTATION, WARRANTY OR COVENANT MADE BY CUSTOMER HEREUNDER, BUT NOT TO THE PROPORTIONATE EXTENT THAT SUCH CLAIM IS CAUSED BY OR RESULTS FROM OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF TRANSPORTER.

TRANSPORTER SHALL RELEASE, DEFEND, INDEMNIFY AND HOLD HARMLESS CUSTOMER AND CUSTOMER'S MEMBERS, DIRECTORS, OFFICERS, AGENTS   13

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AND EMPLOYEES FROM AND AGAINST ANY AND ALL CLAIMS RELATING TO, CAUSED BY OR ARISING OUT OF (I) TRANSPORTER'S BREACH OF ANY REPRESENTATION, WARRANTY OR COVENANT MADE BY TRANSPORTER HEREUNDER, BUT NOT TO THE PROPORTIONATE EXTENT THAT SUCH CLAIM IS CAUSED BY OR RESULTS FROM OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF CUSTOMER, AND (II) OPERATIONS CONDUCTED HEREUNDER OR IN CONNECTION HEREWITH BY TRANSPORTER TO THE EXTENT RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF TRANSPORTER.

NO PARTY SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, LOST PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR CONTRACT, OR OTHERWISE; PROVIDED, HOWEVER, THAT THIS LIMITATION SHALL NOT LIMIT A PARTY'S RIGHT TO RECOVERY HEREUNDER FOR ANY SUCH DAMAGES TO THE EXTENT SUCH PARTY IS REQUIRED TO PAY SUCH DAMAGES TO A THIRD PARTY IN CONNECTION WITH A MATTER FOR WHICH SUCH PARTY IS OTHERWISE ENTITLED TO INDEMNIFICATION HEREUNDER. THE LIMITATIONS IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES SHALL BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE.

Article XIV. Creditworthiness

If Customer has failed to pay any amount when due under this Agreement and if such non-payment is not being disputed in good faith by Customer, Transporter shall have the right to request and receive from Customer adequate assurance of performance (Performance Assurance) which shall mean credit support in a form reasonably acceptable to Transporter and in an amount and for the term reasonably acceptable to Transporter. Any of the following shall be an acceptable form of credit support:

(a) An irrevocable standby letter of credit from a bank satisfactory to Transporter;

(b) Provide a prepayment or a deposit in advance of the Month in which Services hereunder are to be provided; or

(c) A performance bond issued by a Person satisfactory to Transporter.

If the credit of Customer's guarantor is satisfactory in Transporter's opinion, a demand for Performance Assurance can be satisfied with a guarantee issued on behalf of Customer in a form acceptable to Transporter, but only for as long as the credit of Customer's guarantor continues to be acceptable to Transporter. Transporter acknowledges and agrees that Memorial Resource Development Corp. is a satisfactory guarantor.

Should Customer or its guarantor fail to provide Performance Assurance within ten (10) Business Days after receipt of written demand for such assurance, then Transporter shall have the right to suspend performance under this Agreement until such time as Customer furnishes Performance Assurance. For the avoidance of doubt, such suspension of performance by Transporter shall not relieve Customer of its obligation to make payments of amounts due hereunder, including, without limitation, payment of fees due hereunder.   14

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





If during the Term, if Transporter has failed to pay any amount when due under this Agreement and if such non-payment is not being disputed in good faith by Transporter, Customer shall have the right to request and receive from Transporter adequate Performance Assurance under similar terms and conditions as described above, including the right to suspend performance under this Agreement until such time as Transporter furnishes Performance Assurance.

Article XV. Miscellaneous

Entire Agreement. This Agreement, including any exhibits and attachments, constitutes the entire agreement between the Parties pertaining to the subject matter hereof, supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the Parties with respect thereto, and may not be amended or modified except by a written instrument signed by both Parties expressly identifying it as an amendment or modification hereof.

Waiver. Any failure by either Party to comply with any of its obligations, agreements or conditions herein contained may only be waived in writing in an instrument specifically identified as a waiver and signed by the Party to whom such compliance is owed. No waiver of, or consent to a change in, any provision of this Agreement shall be deemed or shall constitute a waiver of, or consent to a change in, any other provisions hereof, nor shall such waiver constitute a continuing waiver unless expressly provided in the waiver.

No Third Party Beneficiaries. Except for Persons indemnified hereunder, this Agreement is not for the benefit of any third party and nothing herein, expressed or implied, confers any right or remedy upon any Person not a party hereto other than Persons which become successors or assigns pursuant the provisions hereof.

No Partnership. It is not the intention of the Parties to create, nor is there created hereby, a partnership, trust, joint venture or association. The status of each Party hereunder is solely that of an independent contractor.

Published Indices. Unless expressly provided otherwise herein, if any published price index referred to in this Agreement ceases to be published, the Parties shall mutually agree to an alternative published price index representative of the published price index referred to in this Agreement.

Headings. The headings and captions in this Agreement have been inserted for convenience of reference only and shall not define or limit any of the terms and provisions hereof.

Governing Law. This Agreement is entered into in the State of Texas and shall be governed, interpreted and construed in accordance with the laws of the State of Texas without regard to the conflicts of laws provisions thereof. Exclusive venue for any suit, action or proceeding brought by either Party in connection with this Agreement or arising out of the terms or conditions hereof shall be in the state or federal courts situated in Harris County, Texas.   15

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Agreement Subject to Laws. This Agreement is subject to all applicable state and federal laws and to all applicable orders, rules, and regulations of any Governmental Authority having jurisdiction. If either Party is ordered or required to do any act inconsistent with the provisions of this Agreement, then this Agreement shall continue nevertheless and shall be deemed modified to conform to the requirements of such law or regulation.

Restrictions on Assignment. This Agreement may not be assigned, disposed of, alienated or otherwise transferred by either Party, in whole or in part, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed, except as provided below.

Permitted Assignments. Notwithstanding the foregoing, (i) either Party may assign this Agreement to an Affiliate of such Party without the consent of the other Party, (ii) either Party may pledge this Agreement to secure any credit facility or indebtedness of such Party or its Affiliates without the consent of the other Party, (iii) Transporter may assign this Agreement without Customer's consent in connection with the sale or transfer of the Transportation System, and (iv) Customer may assign or partially assign this Agreement without Transporter's consent in connection with the sale or transfer of all or part of Customer's ownership interests in the wells (or in the lands upon which such wells are located) producing Customer Gas delivered hereunder, provided that such assignee has a credit rating reasonably acceptable to Transporter at the time of such sale or transfer. In the case of transfers under clause (iv) above, the transferor shall be released from its obligations and liabilities under this Agreement to the extent of the obligations assumed by the transferee, provided that Customer's and such transferee's combined obligations to Transporter shall be no greater than Customer's obligations to Transporter prior to such transfer.

Reports to Governmental Authorities. Neither Party represents or warrants that any information it may furnish to the other Party under the provisions of this Agreement will satisfy any of the requirements that may be imposed by any applicable state or federal laws and by any applicable orders, rules, and regulations of any Governmental Authorities having jurisdiction. Further, neither Party assumes the responsibility for the making of any reports to any Governmental Authorities that are required to be made by or on behalf of the other Party.

Severability. The invalidity of any one or more provisions of this Agreement will not affect the validity of this Agreement as a whole, and in case of any such invalidity, this Agreement will be construed as if the invalid provision had not been included herein so long as the economic and legal substance of the transactions contemplated by this Agreement is not affected in any manner materially adverse to any Party. Upon such determination that one or more provisions of this Agreement are invalid, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.

Expenses. Each Party shall pay its own legal fees and other costs and expenses incurred by it in connection with the execution and delivery of this Agreement.   16

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





No Inducements. No director, employee, or agent of any Party shall give or receive any commission, fee, rebate, gift, or entertainment of significant cost or value in connection with this Agreement.

Counterpart Execution. This Agreement may be executed in any number of counterparts, each of which shall be considered an original, and all of which shall be considered one and the same instrument. Any signature delivered by a Party electronically shall be deemed an original signature.

Term and Termination. This Agreement shall commence on the Effective Date and continue in full force and effect until the end of the fifteenth (15th) Contract Year, and shall continue in full force and effect thereafter until terminated by either Party by providing thirty (30) calendar days' prior written notice of termination to the other Party (such fifteen (15) Contract Year period, as may be further extended as provided herein is referred to as the Term).

Survival. The respective indemnification obligations of the Parties set forth in this Agreement shall survive the expiration of the Term and any termination of this Agreement.

[Signature Page Follows]   17

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





This Agreement is executed by the authorized representatives of the Parties set forth below, to be effective as of the Effective Date.   CUSTOMER:

MRD OPERATING LLC

By: MEMORIAL RESOURCE DEVELOPMENT CORP., its sole member

By: /s/ Kyle Roane Name: Kyle N. Roane Title: Senior Vice President

TRANSPORTER:

PENNTEX NORTH LOUISIANA OPERATING, LLC

By: /s/ Robert O. Bond Name: Robert O. Bond Title: Chief Operating Officer

Signature Page to Gas Transportation Agreement

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Exhibit A Commencement Date Facilities

Pipeline Facilities

  •   0.9 miles of 24 pipeline between the Lincoln Parish Plant and the Points of Delivery below

  •   12 miles of 24 pipeline between the Mount Olive Plant and the Points of Delivery below (such facilities will be placed in service afterthe Commencement Date in conjunction with the Mount Olive Plant)

Points of Delivery

  •   RIGS

  •   Cardinal Arcadia Storage (owned by Transporter or its Affiliate)

Points of Receipt

  •   Lincoln Parish Plant (owned by Transporter or its Affiliate)

  •   Mount Olive Plant (owned by Transporter or its Affiliate)

Miscellaneous Appurtenant Facilities (launchers/receivers, etc.)   Exhibit A

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015





Exhibit B

I. Points of Delivery

Receipt Point Name   Transporter's Meter #   Parish/State

Maximum Volume* (in Mcf/d) RIGS Bratton Camp   10012   Lincoln Parish, LA   up to 400,000 Cardinal Arcadia Storage Bratton Camp   10011   Lincoln Parish, LA   up to 200,000

II. Points of Receipt

Delivery Point Name   Transporter's Meter #   Parish/State

Maximum Volume* (in Mcf/d) PennTex Lincoln Parish Plant   10010   Lincoln Parish, LA   up to 200,000 PennTex Mount Olive Plant   TBD   Lincoln Parish, LA   up to 200,000   * Subject to increased Maximum Volume capacity in accordance with any future expansion of an applicable Measurement Facility.

Exhibit B

Source: PENNTEX MIDSTREAM PARTNERS, LP, S-1/A, 4/16/2015 
Question: Highlight the parts (if any) of this contract related to Covenant Not To Sue that should be reviewed by a lawyer. Details: Is a party restricted from contesting the validity of the counterparty’s ownership of intellectual property or otherwise bringing a claim against the counterparty for matters unrelated to the contract?
answer:
CUSTOMER SHALL RELEASE, DEFEND, INDEMNIFY AND HOLD HARMLESS TRANSPORTER AND TRANSPORTER'S MEMBERS, DIRECTORS, OFFICERS, AGENTS AND EMPLOYEES FROM AND AGAINST ANY AND ALL SUITS, ACTIONS, CAUSES OF ACTION, CLAIMS, DEMANDS, LOSSES, LIABILITIES AND EXPENSES (INCLUDING, WITHOUT LIMITATION, INTEREST, COURT COSTS, REASONABLE ATTORNEYS' FEES AND EXPENSES, AND OTHER COSTS OF DEFENSE) (COLLECTIVELY, "CLAIMS") RELATING TO, CAUSED BY OR ARISING OUT OF CUSTOMER'S BREACH OF ANY REPRESENTATION, WARRANTY OR COVENANT MADE BY CUSTOMER HEREUNDER, BUT NOT TO THE PROPORTIONATE EXTENT THAT SUCH CLAIM IS CAUSED BY OR RESULTS FROM OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF TRANSPORTER.


question:
AMENDMENT NO. 1 TO STREMICK'S HERITAGE FOODS, LLC and PREMIER NUTRITION CORPORATION MANUFACTURING AGREEMENT

This Amendment No. 1 (the Amendment), entered into by and between Stremick's Heritage Foods, LLC (Heritage) Premier Nutrition Corporation (Premier) is effective as of June 11, 2018 (Amendment Effective Date) and amends that certain Manufacturing Agreement between Heritage and Premier dated July 1, 2017 (Agreement). Heritage and Premier are each referred to herein as a Party and collectively as the Parties.

WHEREAS, Heritage and Premier entered into the Agreement;

WHEREAS, the Parties wish to amend the Agreement in accordance with the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the promises and of the mutual covenants, representations and warranties contained in the Agreement and set forth herein, the Parties hereby agree that the following changes shall be made to the Agreement:

1. The Parties hereby agree to remove Section 2(c) in its entirety and replace it with the following:

During the Term of this Agreement, Premier shall be required to purchase a Minimum Annual Order Volume (MAOV) of [***] (Units) for the twelve-month period commencing July 1, 2018 and ending June 30, 2019. The MAOV [***] Units for each twelve-month period commencing July 1, 2019 through the end of the Term, contingent upon commercial aseptic production at Heritage's [***] facility and approval of that facility by Premier by January 1, 2019. For the avoidance of doubt, the six-month period commencing July 1, 2022 and ending December 31, 2022, Premier will be required to purchase [***] (the twelve-month periods and the six-month period are each a Contract Period).

2. Except as otherwise specified above in this Amendment, all other terms, conditions and covenants of the Agreement shall remain in full force and effect.

IN WITNESS WHEREOF, the Parties have caused this Amendment to be signed by their respective duly authorized representatives as of the Amendment Effective Date. Premier Nutrition Corporation Stremick's Heritage Foods, LLC.

By: /s/ Darcy Davenport By: /s/ Sam Stremick Name: Darcy Davenport Name: Sam Stremick Title: President Title: President

Source: BELLRING BRANDS, INC., S-1, 9/20/2019 
Question: Highlight the parts (if any) of this contract related to Minimum Commitment that should be reviewed by a lawyer. Details: Is there a minimum order size or minimum amount or units per-time period that one party must buy from the counterparty under the contract?
answer:

During the Term of this Agreement, Premier shall be required to purchase a Minimum Annual Order Volume ("MAOV") of [***] ("Units") for the twelve-month period commencing July 1, 2018 and ending June 30, 2019.