Document:

EXHIBIT 10.16

                         Marketing Operations Agreement

         This  Marketing  Operations  Agreement is between  Multiband  USA, Inc,
("MBUSA") a Minnesota  Corporation,  located at 9449 Science  Center Drive,  New
Hope, Minnesota 55428 and Broadband Holdings,  LLC, ("Broadband") a South Dakota
LLC, located at 300 East 50th St. North, at Sioux Falls, South Dakota 57104

         Whereas,  MBUSA  and  Broadband  have  entered  into an Asset  Purchase
Agreement  (Purchase  Agreement) with Suncoast  Automation  Inc,  (Suncoast) and
Dauphin Technology Inc. (Dauphin) and

Now therefore the parties agree as follows:

1.   MBUSA and Broadband  will divide those assets and customers of the Suncoast
     acquisition  in the  following  manner and do the following to complete the
     terms of the acquisition.

     1.1  Broadband  will  own all  assets  of the  acquisition  except  for the
          installed  SMATV  equipment  and SMATV work in progress as outlined in
          the  Asset  Purchase  Agreement.   SMATV  equipment  outlined  in  the
          acquisition  shall be that  exclusively of MBUSA.  MBUSA and Broadband
          agree to exchange  cross bills of sale as  described  on Schedule  1.1
          attached  hereto to document  the  division of assets  stated  herein.
          Multiband  shall own in addition to the SMATV equipment and SMATV work
          in  progress,  joint  right  and  interest  in  all  Rights  of  entry
          Agreements as well as sole ownership of SMATV  subscribers.  Likewise,
          Broadband will have joint  interest in all Rights of Entry  Agreements
          and shall own exclusively the right to supply internet and advertising
          to properties covered by this agreement, whether completed,  completed
          for  SMATV  or work in  progress.  Broadband  will  own  internet  and
          advertising customers exclusively. MBUSA has the sole right to provide
          voice and video services to Right of Entry customers  jointly obtained
          via the Asset  Purchase  Agreement.  Broadband  has the sole  right to
          provide internet and advertising  services to Right of Entry customers
          jointly  obtained via the Asset Purchase  Agreement.  Neither party to
          this agreement shall be responsible  for any expenses  incurred in the
          delivery  of services  which it does not  provide or receive  revenues
          from.

     1.2  MBUSA will Bank wire  $161,616.22  dollars to  Suncoast  creditors  as
          outlined in the Asset Purchase Contract.

     1.3  All excess funds that may arise from bank accounts,  prepaid expenses,
          and accounts payable resulting from the Suncoast  acquisition shall be
          that of Broadband.

     1.4  Within 15 days MBUSA will pay to Broadband an  additional  $138,383.78
          to Broadband.

     1.5  MBUSA  will  assume  or pay off the  SMATV  Highland  Equipment  Lease
          outlined in the Suncoast Asset purchase Agreement.

2.   Broadband  will  retain  all  customers,  contracts,  and other  assets not
     determined to be SMATV product from the Suncoast Asset Purchase.

3.   MBUSA and Broadband,  will execute a Marketing Operations Agreement for the
     video services to the current contracted properties listed in Exhibit A and
     the backlog properties listed in Exhibit B, which will be signed, by mutual
     agreement  of the  parties.  Broadband  will  retain  the right to  provide
     Internet and advertising services to the properties,  attached in Exhibit A
     and B. A "Marketing  Operations Plan" will be developed and mutually agreed
     within 30 days of this  agreement,  this  agreement  will  outline  how the
     subject properties will be operated by Multiband USA.

4.   MBUSA  will pay  Broadband  additional  fees for the  Marketing  Operations
     Agreement

         4.1  $150,000  within 30 days from the completion of the Marketing Plan
              but no later  than 60 days  from the

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              close of the Suncoast  Asset  Purchase  Agreement,  provided MBUSA
              does not elect to terminate  the  contract  after  inspecting  the
              scheduled equipment in the Asset Purchase Agreement.

         4.2  Six  Million  (6,000,000)  shares of the Common  Stock,  par value
              $.01,  of MBUSA  (the  "Shares").  The  shares  shall be issued as
              follows: For every 1,000 verified active units delivered to MBUSA,
              MBUSA shall issue 125,000 shares to Broadband.  In the event Right
              of  Entry  Agreements  are  obtained  more  quickly  than  MBUSA's
              build-out  of the work in process,  then MBUSA agrees to issue all
              shares up to 6,000,000 on a pro-rata  basis based on the number of
              units contained in verified right of entry  agreements.  MBUSA and
              Broadband  agree that MBUSA,  at its sole  option and  discretion,
              shall have the right but not the  obligation to convert at anytime
              said Common  Stock into one share of Common  Stock of Vicom,  Inc.
              for every ten shares of MBUSA.

         4.3  For  purposes  of  4.2  a "verified  unit" is a Multiple  Dwelling
              Unit  or  time   share  unit for  which a Right of Entry  Contract
              has been obtained by Broadband or by MBUSA.

5.   The Marketing Operations Plan will include the following provisions:

         5.1  MBUSA  will own the  customers  of  Suncoast  for  video  services
         including  SMATV  and Pay Per View  only  (also  referred  to as tiered
         services).

         5.2 MBUSA will supply  equipment,  labor,  and programming  services to
         fulfill  the  requirements  of  all  Exclusive  Cable  Development  and
         Programming  Services Agreements entered into for the properties listed
         on Exhibit A and B.

         5.3  Day to Day  Operations:  MBUSA  will  bill  and  collect  for  all
         subscriber  services  and handle all  activities  necessary to install,
         maintain, and provide quality services related to the subscribers.

         5.4 Profit  Sharing:  Net income from SMATV services will be divided as
         follows:  net  income  will be  split  50/50  for the  duration  of the
         Management Agreement and any subsequent  renewals.  Net income shall be
         defined  as  Revenues,   not  including  taxes,  less  actual  cost  of
         subscriber programming services, property management commissions,  call
         center  expenses,  maintenance,  marketing,  and project  management as
         mutually  agreed but not to exceed 13.5% of gross  sales.  No provision
         for any other  expenses  shall be  incurred  into this  Profit  Sharing
         equation.  If,  at the end of 1 year  from the date of this  agreement,
         actual management expenses exceed 13.5% of revenues on an annual basis,
         then  Broadband  shall have the option to take over  management  of the
         SMATV subscribers for the following 12 month period. However, if at the
         end of that 12 month  period  Broadband's  actual  management  expenses
         exceed 13.5% of revenues on an annual  basis,  than  management  of the
         SMATV  subscribers  shall revert back to MBUSA for the duration of this
         Marketing Agreement.

              MBUSA shall not be entitled to any internet revenues  initiated by
              Broadband.  Broadband  shall audit the  records on a quarterly  or
              annual basis, any payment differences or overpayments will be paid
              in 30 days.

              Profits: MBUSA shall deliver to Broadband a monthly profit sharing
              statement within 30 days after close of each month, accompanied by
              a profit sharing check.

              Losses:  Buyer, may cease providing  service to the subscribers in
              the event of three  consecutive  months of net  losses  or, in the
              alternative,  four Months of net losses over any 12 month  period.
              However, MBUSA and Broadband mutually agree that if either company
              plans to cease  operations they will give 30 days notice and grant
              a first  right of  refusal  for their  right of entry  agreements,
              equipment, and software.

         5.5 MBUSA  shall be given a key or other  means of  physical  access to
         each and every  "head-end" room at the properties where video equipment
         exists.

6.   Non  Competition.  The  parties  agree that this  agreement  covers a Joint
     Venture Agreement on SMATV services.  MBUSA or its affiliates agree that it
     will not solicit these properties listed in Exhibit A and B or their owners
     or developers for SMATV or internet services.  MBUSA will rely on Broadband
     to manage relationships with these properties,  and their owners,  managers
     or developers.  In the event a Marketing Agreement is not

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     completed,  MBUSA and its  director  Vern  Swedin,  agree to  refrain  from
     contacting the properties  developers or owners presented or the principals
     introduced as participants in this transaction for 1 year.

7.   Completion of Negotiations, costs. We shall, upon acceptance of this letter
     by you, commence negotiations in good faith with respect to the final terms
     of the Marketing  Operations  Plan and the other  agreements  and documents
     contemplated by this letter,  and shall use our best efforts to prepare all
     of the documentation necessary to complete and execute such Agreement so as
     to permit the  Closing  to occur as soon as  reasonably  practicable.  Each
     party shall be responsible for its respective costs and expenses, including
     attorneys'  fees and costs,  incurred in negotiating  this letter of intent
     and the other documents referenced herein.

8.   Confidentiality.  Each  party  agrees  to  hold  confidential  all  matters
     relating to the transaction  described herein  (including the substance and
     form of this letter of intent and  negotiations  relating  hereto).  If the
     parties are unable or unwilling to complete the transaction contemplated by
     this letter of intent,  it will  return to the other party any  statements,
     documents or other written  information  containing  trade secrets or other
     confidential  business information furnished by such other part or parties,
     and all copies thereof (other than work papers and work product),  and that
     in any case it will not reveal to any third party any of the other  party's
     trade secrets or confidential business information that the other party has
     provided to it; provided,  however, that this obligation shall not apply to
     (a) any  information  which  was  known  to the  recipient  party  prior to
     disclosure  thereof by the other party; (b) any information that was in the
     public domain prior to disclosure  thereof by the other party, as evidenced
     by public or published  information or trade sources;  (c) any  information
     which comes into the public domain through no fault of the recipient party;
     or (d) any information  which is disclosed to the recipient part by a third
     party  who  has a  legal  right  to  make  such  disclosure.  The  parties'
     obligations  under this  Paragraph 8 shall survive the  termination of this
     letter of intent. The parties  acknowledge and agree that such confidential
     information is proprietary to the disclosing party, and that any disclosure
     or  unauthorized  use thereof will cause  irreparable  harm and loss to the
     disclosing  party.  Each party hereby agrees that if it shall engage in any
     act in  violation  of  such  provisions,  the  disclosing  party  shall  be
     entitled,  in  addition  to  such  other  remedies  and  damages  as may be
     available,  to an  injunction  prohibiting  the such party from engaging in
     such act.

9.   Governing  Law. This Agreement  shall be construed in accordance  with, and
     governed  by the  substantive  laws of,  the  State of  Minnesota,  without
     reference to principles  governing  choice or conflicts of laws. Each party
     hereby submits to the  jurisdiction of the state and federal courts sitting
     in the State of Minnesota.

10.  Arbitration.  Any  controversy,  dispute  or  claim  arising  out  of or in
     connection  with this letter of intent shall be conclusively  resolved,  at
     the  request of either  party,  by  arbitration  conducted  in the State of
     Minnesota  in  accordance  with  the then  existing  Rules  for  Commercial
     Arbitration of the American Arbitration Association,  except there shall be
     only one (1)  arbitrator  and the rules  applicable  to  discovery in civil
     actions  generally  shall be  available  to both parties up to 120 calendar
     days after the  filing of the  petition  for  arbitration  by either  party
     hereto.  A judgment based upon the  determination  made in such arbitration
     may be entered by any state or federal court having  jurisdiction  thereof.
     As  part  of  the  award,  the  arbitrator  shall  allocate  in  his or her
     discretion  all  costs  of  the  arbitration,  including  the  fees  of the
     arbitrator  and  reasonable  attorney's  fees  and  costs  incurred  by the
     prevailing party.

                                       19EXHIBIT 10.19

          -------------------------------------------------------------

                               OPERATING AGREEMENT

                                       OF

                                  BWP GAS, LLC

                               DATED JULY 21, 2003

          -------------------------------------------------------------

<PAGE>

                               OPERATING AGREEMENT
                                       OF
                                  BWP GAS, LLC

         THIS  OPERATING  AGREEMENT  (this  "Agreement"),  dated July 21,  2003,
effective May 22, 2003, is entered into by and between  Oklahoma Hills Gas, LLC,
a Delaware  limited  liability  company,  as a Member and Manager,  and HBA Gas,
Inc., a Delaware corporation, as a Member.

                                    RECITALS

         WHEREAS,  the Company was formed as a limited  liability  company under
the Act  for  the  principal  purpose  of  acquiring,  exploring,  drilling  and
developing domestic natural gas and oil properties; and

         WHEREAS,  the initial Members wish to provide for the administration of
the  business and affairs of the Company and the rights and  obligations  of the
Members with respect thereto;

         NOW,  THEREFORE,  the parties  hereto,  intending  to be legally  bound
hereby, mutually agree as follows:

                                   DEFINITIONS

         For the purposes of this Agreement,  the following terms shall have the
definitions ascribed to them herein:

"ACT" shall mean the  Delaware  Limited  Liability  Company Act, Ch. 18, Tit. 6,
Sec. 18-101, et seq. (the "Act") and any successor statutes, as amended.

"ADDITIONAL MEMBER" shall have the meaning ascribed to such term in Section 2.3.

"CAPITAL  ACCOUNT"  shall mean the dollar  amount of the  Member's  claim on the
capital of the Company (or, if the Member has a negative Capital Account, of the
Company's claim on the capital of the Member).

"CAPITAL  CONTRIBUTIONS" shall mean any contributions of cash, non-cash property
and services and the promises of cash,  non-cash property and services,  made to
the Company by a Member.

"CERTIFICATE" shall have the meaning ascribed to such term in Section 1.2.

"CLASS A MEMBER" shall have the meaning ascribed to such term in Section 2.2.

"CLASS  A  PERCENTAGE   INTEREST"  shall  mean  the  fraction  (expressed  as  a
percentage), the numerator of which is the Percentage Interest of the applicable
Class A Member and the denominator of which is the aggregate Percentage Interest

<PAGE>

of all  Class A Members  on the date of  computation  as set forth on  EXHIBIT A
attached hereto and as amended from time to time.

"CLASS B MEMBER" shall have the meaning ascribed to such term in Section 2.2.

"CLASS  B  PERCENTAGE   INTEREST"  shall  mean  the  fraction  (expressed  as  a
percentage), the numerator of which is the Percentage Interest of the applicable
Class B Member and the denominator of which is the aggregate Percentage Interest
of all  Class B Members  on the date of  computation  as set forth on  EXHIBIT A
attached hereto and as amended from time to time.

"CODE" shall mean the Internal Revenue Code of 1986, as amended.

"CONFIDENTIAL  INFORMATION" shall mean the terms of this Agreement,  information
that the Company maintains in confidence,  information that the Manager knows to
be proprietary to the Company, financial information relating to the Company and
to the Managers,  information  relating to Company  marketing and business plans
and  strategies,  information  concerning the design and  manufacture of Company
products and concerning  methods of providing Company  services,  information in
Company  personnel  files and similar  files  relating to Company  Managers  and
employees,  information entrusted to the Company in confidence by third parties,
and   information   reasonably   designated  by  the  Managers  as  Confidential
Information

"DISSOLUTION"  shall  mean  the  cessation  of  the  Company's  normal  business
activities  and the  beginning  of the  process of winding up its  business  and
internal affairs and of liquidating it.

"DISTRIBUTION"  shall mean a  transfer  of the  Profits  or other  assets of the
Company to a Member in the  Member's  capacity as a member in cash,  by check or
otherwise. Payments specifically identified in this Agreement as compensation to
the Members for  services to or on behalf of the Company  shall not be deemed to
be Distributions within the meaning of this Agreement.

"EFFECTIVE DATE" shall have the meaning ascribed to such term in Section 1.1.

"INCAPACITY" means (i) with respect to a natural Person, the bankruptcy,  death,
disability  or  incompetency  of such Person,  and (b) with respect to any other
Person, the bankruptcy, liquidation, dissolution or termination of such Person.

 "MANAGEMENT  RIGHTS"  shall mean all rights of a Member as a member  except the
Member's  right to  receive  allocations  of  Company  Profits  and  Losses  and
Distributions of Company assets.

"MANAGER" or MANAGERS"  means any Person or Persons  elected by the Members as a
manager of the Company as provided in this  Agreement,  but does not include any
Person who has ceased to be a manager of the Company.

"MEMBER"  means  any  Person  executing  this  Agreement  as of the date of this
Agreement  as a member  or  hereafter  admitted  to the  Company  as a member as
provided in this Agreement, but does not include any Person who has ceased to be
a member in the Company.

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<PAGE>

"MEMBERSHIP  INTEREST" shall mean a Member's share of the Company's  Profits and
Losses, and the Member's right to receive Distributions of the Company's assets.

"MEMBERSHIP RIGHTS" shall have the meaning ascribed to such term in Section 2.5.

"PERCENTAGE INTEREST" means, with respect to any Member, the Percentage Interest
set forth opposite such Member's name on SCHEDULE A attached hereto.

"PERSON"  means a natural  person,  partnership  (whether  general or  limited),
limited liability company, trust, estate, association,  corporation,  custodian,
nominee,  or any other  individual  or  entity in its own or any  representative
capacity.

"PROCEEDING" shall have the meaning ascribed to such term in Section 9.2.

"PROFITS" and "LOSSES" shall mean the taxable  income and losses,  respectively,
of the Company as determined for Federal income tax purposes in accordance  with
the accounting  method  followed by the Company for such  purposes,  adjusted as
follows:  (i) any expenditures of the Company described in Section  705(a)(2)(B)
of the Code, or treated as Code Section  705(a)(2)(B)  expenditures  pursuant to
Treasury  Regulation Section  1.704(b)(2)(iv)(i),  shall be subtracted from such
taxable income or losses,  and (ii) if property is reflected on the books of the
Company  at a book  value  that  differs  from the  adjusted  tax  basis of such
property,  depreciation,  amortization  and gain or loss  with  respect  to such
property shall be determined by reference to such book value.

"SUBSTITUTED  MEMBER" shall mean a transferee  of any economic and  non-economic
rights of an existing Member.

"UNLAWFUL  DISTRIBUTION" shall have the meaning ascribed to such term in Section
4.5.

                                    SECTION 1
                             PRELIMINARY PROVISIONS

         1.1      BINDING EFFECT OF AGREEMENT; EFFECTIVE DATE

         This  Agreement  shall bind the initial  Members  when all of them have
signed it. The effective date of the Agreement (the  "Effective  Date") shall be
May 22, 2003.

         1.2      ACCEPTANCE OF CERTIFICATE OF FORMATION

         Each initial  Member hereby  acknowledges  that the initial  Member has
carefully   reviewed   the   Certificate   of  Formation  of  the  Company  (the
"Certificate")  and that each of its  provisions  is  acceptable  to the initial
Member.

         1.3      AMENDMENT OF AGREEMENT AND CERTIFICATE

         Except as otherwise expressly provided in this Agreement,  no amendment
of the  Agreement or of the  Certificate  shall be valid unless it is in writing
and signed by all of the Members.

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<PAGE>

         1.4      FORMATION

         On or promptly  after the  Effective  Date,  the initial  Members shall
cause the  Certificate  to be filed with the  Secretary of State of the State of
Delaware.

         1.5      ENTITY STATUS

         Upon its  formation,  the Company shall be a legal entity  separate and
distinct from its Members.

         1.6      NAME

         The name of the Company shall be "BWP Gas, LLC."

         1.7      PRINCIPAL OFFICE

         The  principal   office  of  the  Company  shall  be  111  Presidential
Boulevard, Suite 158A, Bala Cynwyd,  Pennsylvania 19004, or such place or places
as the Managers may designate from time to time. The Company may have such other
offices and places of business as the Managers may designate from time to time.

         1.8      REGISTERED OFFICE; REGISTERED AGENT

         The  registered  office  of  the  Company  required  by  the  Act to be
maintained  in the  State  of  Delaware  shall  be  the  office  of the  initial
registered  agent named in the  Certificate or such other office (which need not
be a place of business of the Company) as the Managers may  designate  from time
to time in the manner  provided by law. The  registered  agent of the Company in
the  State  of  Delaware  shall be the  initial  registered  agent  named in the
Certificate  or such other Person or Persons as the Managers may designate  from
time to time in the manner provided by law.

         1.9      PURPOSE

         The Company's principal purpose shall be to acquire, explore, drill and
develop  domestic  natural  gas and oil  properties,  and to engage in any other
business  activity  that  now  or  hereafter  may  be  necessary,   appropriate,
desirable,  incidental,  advisable or  convenient  to  accomplish  the foregoing
purpose (including obtaining financing  therefor),  and that is not forbidden by
the Act or the law of the jurisdiction in which the Company engages in business.

         1.10     POWERS

         In pursuing its lawful  purposes,  the Company shall be empowered to do
all things that limited liability companies are permitted to do under the Act.

         1.11     FOREIGN QUALIFICATIONS.

         Prior to the Company conducting business in any jurisdiction other than
Delaware,  the  Managers  shall  cause the  Company  to  comply,  to the  extent
procedures are available and those matters are reasonably  within the control of
the Managers, with all requirements necessary to qualify the Company as a

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<PAGE>

foreign limited  liability company in that  jurisdiction.  At the request of the
Managers,  each Member  shall  execute,  acknowledge,  swear to, and deliver all
certificates  and other  instruments  conforming  with this  Agreement  that are
necessary or  appropriate to qualify,  continue,  and terminate the Company as a
foreign limited liability company in all such jurisdictions in which the Company
may conduct business

         1.12     MANAGEMENT STRUCTURE

         The  management  of the business  and  internal  affairs of the Company
shall be reserved to one or more Managers.  Except as otherwise provided in this
Agreement, only the Managers may bind the Company and decide matters relating to
the  Company's  business and internal  affairs,  provided that the Members shall
have voting rights, information rights and dispute resolution rights provided in
this Agreement.  The Members may change the number of the Company's  Managers at
any time upon the  affirmative  vote of  Members  holding a  majority  of Member
votes.

         1.13     LIMITED LIABILITY OF MEMBERS AND MANAGER

         No Member or Manager shall be  personally  obligated to any third party
for any debt, obligation or liability of the Company solely by reason of being a
Member or  Manager.  Members  and  Managers  shall be liable for their  personal
conduct as provided by law.

         1.14     BUSINESS ACTIVITIES AND VENTURES OF MEMBERS AND MANAGERS

         Each  Member,  Manager  and officer of the Company at any time and from
time to time may engage in and possess  interests in other  business  activities
and  ventures  of any and  every  type and  description,  independently  or with
others,  including ones in competition  with the Company,  with no obligation to
offer to the Company or any other  Member,  Managers  or  officers  the right to
participate therein,  and neither the Company nor the other Members,  Manager or
officers shall have any rights in such other  business  activities and ventures.
The Company may transact business with any Manager, Member, officer or affiliate
thereof,  provided the terms of those  transactions  are no less  favorable than
those the Company could obtain from unrelated third parties.

         1.15     ANNUAL ACCOUNTING PERIOD

         The Company's  fiscal year for financial and tax purposes  shall be the
calendar year.

         1.16     METHOD OF ACCOUNTING

         The Company  shall use the accrual  method of accounting to compute its
taxable income.

         1.17     BUSINESS ASSET PROTECTION

         The Members intend that to the maximum extent  permitted by the Act and
by other  applicable  law,  the assets of the Company  shall be  unavailable  to
satisfy obligations incurred by the Members in their personal capacity.

                                        5
<PAGE>

                                    SECTION 2
                           MEMBERSHIP IN THE COMPANY;
                   TRANSFERS AND PLEDGES OF MEMBERSHIP RIGHTS;
                             MEMBERS' VOTING RIGHTS

         2.1      IDENTITY OF INITIAL MEMBERS

         On the  Effective  Date,  the initial  Members shall be as set forth on
SCHEDULE A attached hereto.

         2.2      CLASSES OF MEMBERS

         The Company shall have two classes of Members:  Class A Members ("Class
A Members") and Class B Members ("Class B Members").  The initial Class A Member
shall be Oklahoma  Hills Gas, LLC, a Delaware  limited  liability  company.  The
initial Class B Member shall be HBA Gas, Inc., a Delaware corporation. Except as
otherwise expressly provided in this Agreement,  each Member shall have the same
rights, duties, privileges, authority and liabilities as each other Member.

         2.3      ADMISSION OF ADDITIONAL MEMBERS

         The  Members  shall  admit no  Person  as an  additional  Member of the
Company after the Company's  formation (an "Additional  Member") except upon the
affirmative vote of Members holding a majority of Member votes.

         2.4      EXECUTION OF THIS AGREEMENT BY SUBSTITUTED MEMBER

         No Person shall be admitted as an Additional or  Substituted  Member of
the Company until the Additional or Substituted  Member signs this Agreement (as
it may be amended from time to time before the  admission of the  Additional  or
Substituted Member).

         2.5      MEMBERSHIP RIGHTS

         For purposes of this Agreement,  the membership rights of a Member (the
"Membership  Rights")  shall mean the totality of a Member's  rights as a member
under the  Agreement  and the Act,  including  both  economic  and  non-economic
rights.

         2.6     LACK OF AUTHORITY.

         No Member shall have any power or authority,  in his or her capacity as
a Member, to represent,  act for, sign for, or bind the Managers or the Company,
or to do any  act  that  would  be  binding  on the  Company,  or to  incur  any
expenditures  or obligations  on behalf of the Company.  Except when acting as a
Manager or an officer of the Company, or pursuant to separate service agreements
or other  agreements  or  contracts  between  the  Company  and a Member,  or as
otherwise specifically provided herein, the Members shall not participate in the
management or control of the Company  business,  nor shall the Members  transact
any business for the Company.  The Members hereby consent to the exercise by the
Managers of the powers conferred on the Managers by law and by this Agreement.

                                        6
<PAGE>

         2.7      FORUM; REMEDIES

         Subject to any contrary  provisions  in Section 14, any claim against a
Member in the  Member's  capacity  as a member  shall be decided in  arbitration
under Section 14, and in any such  arbitration,  the  arbitrator  may impose any
legal or equitable remedy that the arbitrator determines to be reasonable in the
circumstances.

         2.8      TRANSFERS OR PLEDGES OF MEMBERSHIP RIGHTS TO SUBSTITUTED
                  MEMBERS

         Except  with the  consent of  Managers  holding a  majority  of Manager
votes,  no Member shall  transfer  all or any part of the  Member's  rights as a
member  (whether these rights are economic or  non-economic)  to any Substituted
Member, including another Member, nor shall any Member pledge all or any part of
such Member's rights to any Person.  In the event that any Membership  Interests
are  transferred  in  accordance  with the  provisions  of this  Agreement,  the
transferees  of  such  Membership  Interests  shall  succeed  to the  Percentage
Interest  of its  transferor  to the extent  that it relates to the  transferred
Membership Interest.

         2.9      TRANSFERS AND PLEDGES IN BREACH OF THIS AGREEMENT

         Transfers  and pledges of  Membership  Rights in breach of the terms of
this Agreement shall be void and of no effect.

         2.10     RIGHT OF FIRST REFUSAL

         Except as otherwise provided in this Agreement, the Company may require
a Member to promptly sell all or any part of the Member's Membership Interest to
the  Company  or to the other  Members  for its then fair  value and upon  other
reasonable  purchase terms if the Member is  dissociated  from the Company under
Section 11, or an  arbitrator  orders such a sale under Section 14 on the ground
that it is fair and reasonable in the circumstances.

         2.11     ELECTION UNDER CODE SECTION 754

         Before any Member  transfers any of the Member's  rights as a Member to
any Person, the Members shall negotiate in good faith and shall agree whether to
file an election under Code Section 754 to adjust the basis of Company  property
in connection with that transfer.

         2.12     MEMBERS' VOTING RIGHTS

         Except as otherwise  expressly provided in this Agreement,  the Class B
Members shall have the exclusive right to vote on all matters  pertaining to the
Company,  and each Class B Member shall be entitled to cast that number of votes
as shall  equal the  product of the Class B  Percentage  Interest of such Member
multiplied  by one hundred  (100).  Each matter  voted on by the Class B Members
shall be decided by the  affirmative  vote of Class B Members holding a majority
of  Class B  Member  votes.  Except  as  otherwise  expressly  provided  in this
Agreement, the Class A Members shall not be entitled to any voting rights on any
matters pertaining to the Company.

                                        7
<PAGE>

         2.13     PROCEDURES FOR MEMBER VOTING

         Members may vote on matters in person,  by phone,  by fax, by e-mail or
by any other reasonable means.  Each Member shall have a reasonable  opportunity
to be heard on each matter on which the Members vote. The Managers shall appoint
a manager  who shall use the his or her best  efforts to record each Member vote
accurately  and to circulate  this record among the Members  promptly  after the
vote,  provided  that the failure of the manager to  circulate  this record with
respect to any vote shall not be evidence of the  invalidity  of the vote.

         2.14 APPOINTMENT OF INITIAL MANAGER

         The following  Person is hereby appointed and elected by the Members as
the initial Manager of the Company,  to serve in accordance with this Agreement,
until successors or additional Managers are appointed by the Members:

                             Oklahoma Hills Gas, LLC

Effective May ___, 2003, the initial Manager is hereby removed as the Manager of
the Company,  and the  following  Person is hereby  appointed and elected by the
Members as the successor  Manager of the Company,  to serve in  accordance  with
this  Agreement,  until  successors or additional  Managers are appointed by the
Members:

                       Continental Southern Resources, LLC

         2.15     MEETINGS.

                  (a) A quorum  shall be  present at a meeting of Members if the
holders of a majority of Member votes are  represented  at the meeting in person
or by proxy.  With  respect  to any  matter,  other  than a matter for which the
affirmative  vote  of the  holders  of a  specified  portion  of the  Membership
Interests  of  all  Members  entitled  to  vote  is  required  by the  Act,  the
affirmative  vote of a majority of Member votes at a meeting of Members at which
a quorum is present shall be the act of the Members.

                  (b) All meetings of the Members shall be held at the principal
place of business  of the  Company or at such other place  within or without the
State of  Pennsylvania  as shall be specified or fixed in the notices or waivers
of notice thereof,  provided that any or all Members may participate in any such
meeting by means of conference telephone or similar communications  equipment by
means of which all Persons participating in the meeting can hear each other.

                  (c) Notwithstanding the other provisions of the Certificate or
this  Agreement,  the  chairman  of the  meeting or the holders of a majority of
Member  votes shall have the power to adjourn  such  meeting  from time to time,
without any notice other than  announcement at the meeting of the time and place
of the holding of the adjourned meeting. If such meeting is adjourned by the

                                        8
<PAGE>

Members,  such time and place shall be  determined by a vote of the holders of a
majority of the Member votes. Upon the resumption of such adjourned meeting, any
business may be  transacted  that might have been  transacted  at the meeting as
originally called.

                  (d) An annual meeting of the Members,  for the election of the
Managers and for the  transaction  of such other  business as may properly  come
before the meeting,  shall be held at such place, within or without the State of
Delaware,  on such date and at such time as the Managers shall fix and set forth
in the notice of the meeting,  which date shall be within  thirteen  (13) months
subsequent to the date of organization of the Company or the last annual meeting
of Members, whichever most recently occurred.

                  (e) Special  meetings of the Members for any proper purpose or
purposes  may be called at any time by the  Managers  or the holders of at least
ten  percent  (10%) of  Member  votes.  If not  otherwise  stated in or fixed in
accordance with the remaining provisions hereof, the record date for determining
Members  entitled to call a special  meeting is the date any Member  first signs
the  notice of that  meeting.  Only  business  within the  purpose  or  purposes
described in the notice (or waiver  thereof)  required by this  Agreement may be
conducted at a special meeting of the Members.

                  (f) Written or printed notice stating the place,  day and hour
of the meeting  and, in the case of a special  meeting,  the purpose or purposes
for which the meeting is called,  shall be delivered  not less than ten (10) nor
more than sixty (60) days before the date of the meeting,  either  personally or
by mail, by or at the  direction of the Managers or Person  calling the meeting,
to each Member. If mailed,  any such notice shall be deemed to be delivered when
deposited  in the United  States  mail,  addressed  to the Member,  with postage
thereon prepaid.

                  (g) The date on which  notice of a meeting  of the  Members is
mailed  or the  date  on  which  the  resolution  of the  Managers  declaring  a
Distribution  is adopted,  as the case may be,  shall be the record date for the
determination  of the Members  entitled to notice of or to vote at such meeting,
including  any  adjournment  thereof,  or the Members  entitled to receive  such
Distribution.

                  (h) The right of Members to cumulative  voting in the election
of Managers is expressly prohibited.

         2.16     VOTING LIST.

         The Managers  shall make, at least ten (10) days before each meeting of
the Members,  a complete list of the Members entitled to vote at such meeting or
any adjournment thereof, arranged in alphabetical order, with the address of and
the Membership  Interests held by each,  which list shall be kept on file at the
registered  office or  principal  place of  business of the Company and shall be
subject to  inspection  by any Member at any time during usual  business  hours.
Such  list  shall  also be  produced  and kept open at the time and place of the
meeting and shall be subject to the  inspection  of any Member  during the whole
time of the  meeting.  The  original  membership  records  shall be  prima-facie
evidence as to the identity of the Members entitled to examine such list or

                                        9
<PAGE>

transfer  records or to vote at any meeting of  Members.  Failure to comply with
the  requirements  of this  Section  shall not affect the validity of any action
taken at the meeting.

         2.17     PROXIES.

         A Member may vote  either in person or by proxy  executed in writing by
the Member. A telegram,  telex, cablegram or similar transmission by the Member,
or a photographic,  photostatic,  facsimile or similar reproduction of a writing
executed by the Member, shall be treated as an execution in writing for purposes
of this Section. Proxies for use at any meeting of Members or in connection with
the taking of any action by written  consent  shall be filed with the  Managers,
before or at the time of the meeting or execution of the written consent, as the
case may be. All proxies  shall be received  and taken charge of and all ballots
shall be received and canvassed by the Managers,  who shall decide all questions
touching upon the qualification of voters, the validity of the proxies,  and the
acceptance or rejection of votes,  unless an inspector or inspectors  shall have
been appointed by the chairman of the meeting,  in which event such inspector or
inspectors shall decide all such questions. No proxy shall be valid after twelve
(12)  months from the date of its  execution  unless  otherwise  provided in the
proxy.  A proxy shall be revocable  unless the proxy form  conspicuously  states
that the proxy is irrevocable and the proxy is coupled with an interest.  Should
a proxy designate two or more Persons to act as proxies,  unless that instrument
shall provide to the contrary, a majority of such Persons present at any meeting
at which their powers thereunder are to be exercised shall have and may exercise
all the powers of voting or giving consents thereby conferred, or if only one be
present,  then such powers may be  exercised  by that one; or, if an even number
attend and a majority do not agree on a particular  issue, the Company shall not
be required  to  recognize  such proxy with  respect to such issue if such proxy
does not specify how the Membership Interests that are the subject of such proxy
are to be voted with respect to such issue.

         2.18     CONDUCT OF MEETINGS.

         All meetings of the Members  shall be presided  over by the chairman of
the meeting, who shall be a Manager (or representative  thereof) designated by a
majority of the Managers. The chairman of any meeting of Members shall determine
the  order  of  business  and  the  procedure  at the  meeting,  including  such
regulation  of the manner of voting and the conduct of discussion as seem to him
in order.

         2.19     ACTION BY WRITTEN CONSENT OR TELEPHONE CONFERENCE.

                  (a) Any action required or permitted to be taken at any annual
or special  meeting of Members  may be taken  without a meeting,  without  prior
notice,  and without a vote, if a consent or consents in writing,  setting forth
the  action so taken,  shall be signed by the holder or holders of not less than
the minimum  number of Class B Member votes that would be necessary to take such
action at a meeting at which the holders of all Class B Member votes entitled to
vote on the action were present and voted. Every written consent shall bear the

                                       10
<PAGE>

date of signature of each Member who signs the consent. No written consent shall
be  effective  to take the action  that is the  subject to the  consent  unless,
within sixty (60) days after the date of the earliest dated consent delivered to
the Company in the manner required by this Section, a consent or consents signed
by the holder or holders of not less than the minimum  Class B Member votes that
would be  necessary  to take the action  that is the  subject of the consent are
delivered to the Company by delivery to its  registered  office,  its  principal
place of business,  or the Managers.  Delivery  shall be by hand or certified or
registered mail, return receipt requested.  Delivery to the Company's  principal
place of  business  shall be  addressed  to the  Managers.  A  telegram,  telex,
cablegram or similar  transmission by a Member, or a photographic,  photostatic,
facsimile  or similar  reproduction  of a writing  signed by a Member,  shall be
regarded as signed by the Member for purposes of this Section.  Prompt notice of
the  taking of any action by  Members  without a meeting by less than  unanimous
written  consent  shall be given to those Members who did not consent in writing
to the action.

                  (b) The  record  date  for  determining  Members  entitled  to
consent to action in writing  without a meeting shall be the first date on which
a signed written  consent setting forth the action taken or proposed to be taken
is delivered to the Company by delivery to its registered  office, its principal
place of business, or the Managers. Delivery shall be by hand or by certified or
registered mail, return receipt requested.  Delivery to the Company's  principal
place of business shall be addressed to the Managers.

                  (c) If any action by Members is taken by written consent,  any
articles or documents filed with the Secretary of State of the State of Delaware
as a result of the taking of the action  shall state,  in lieu of any  statement
required by the Act  concerning  any vote of Members,  that written  consent has
been given in  accordance  with the  provisions  of the Act and that any written
notice required by the Act has been given.

                  (d) Members may  participate in and hold a meeting by means of
conference telephone or similar  communications  equipment by means of which all
Persons  participating in the meeting can hear each other, and  participation in
such meeting shall constitute attendance and presence in person at such meeting,
except  where a Person  participates  in the meeting for the express  purpose of
objecting to the  transaction  of any business on the ground that the meeting is
not lawfully called or convened.

                                    SECTION 3
                     CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS

         3.1      INITIAL CAPITAL CONTRIBUTIONS

         Promptly after the Effective  Date, the initial  Members shall make the
initial  Capital  Contributions  to the Company set forth on SCHEDULE A attached
hereto in exchange for their respective Membership Interests.

                                       11
<PAGE>

         3.2      ESTABLISHMENT OF CAPITAL ACCOUNTS.

         An individual Capital Account shall be established for each Member. The
Capital Account of each Member shall consist of its initial Capital Contribution
and shall be increased  by: (i) any  additional  Capital  Contributions  by such
Member;  (ii) such Member's share of any income or gains,  including the Profits
allocated to such Member  pursuant to this  Agreement;  and (iii) such  Member's
share of any income or gain exempt from federal  income tax  (determined  in the
same manner as Profits are  allocated to such  Members),  and shall be decreased
by: (i) such Member's share of Losses  allocated to such Member pursuant to this
Agreement; (ii) any Distribution to such Member of cash or the fair market value
of any other property (net of liabilities assumed by such Member and liabilities
to  which  such  property  is  subject);   and  (iii)  such  Member's  share  of
expenditures of the Company described in Code Section  705(a)(2)(B)  (determined
in the same manner as Losses are allocated to such Members).

         3.3 DETERMINATION OF CAPITAL ACCOUNTS.

         The  Company  shall  compute  the  Capital  Account of each Member on a
reasonably  current  basis.  Except as otherwise  provided  herein,  the Capital
Account of a Member shall be determined in all events solely in accordance  with
the rules set forth in Treasury Regulation Section  1.704-1(b)(2)(iv)  and other
applicable Treasury Regulations as the same may be amended or revised hereafter.
To the extent that any  provision  of this  Agreement is  inconsistent  with the
requirements  of  Treasury   Regulation   Section   1.704(b)(2)(iv)  as  to  the
calculation  of a Member's  Capital  Account,  such  Treasury  Regulation  shall
control.  Any  references in this  Agreement to the Capital  Account of a Member
shall be deemed to refer to such Capital  Account as the same may be credited or
debited from time to time as set forth above.

         3.4 ADDITIONAL CONTRIBUTIONS

         No  Member  shall  have an  obligation  to make an  additional  Capital
Contribution  or loan to the Company.  If  additional  funds are advanced to the
Company by the Members, such funds shall be additional Capital Contributions.

         3.5 CONTRIBUTIONS AND COMPROMISES BY INCAPACITATED MEMBERS

         Each Member and such Member's  representative or successor (as the case
may be) shall be  obligated  to  perform  any  promise  by the  Member to make a
Capital  Contribution  to the Company even if the Member is prevented from doing
so because of any Incapacity.

         3.6 PROMISES TO MAKE CAPITAL CONTRIBUTIONS

         No promise by a Member to make a Capital  Contribution  to the  Company
shall be enforceable  unless set forth in this  Agreement or in another  writing
signed by the Member.  No promise by a Member to make a Capital  Contribution to
the Company shall be compromised  except by the  affirmative  vote of all of the
other Members.

         3.7 NO INTEREST ON CONTRIBUTIONS

         The Members shall earn no interest on their Capital Contributions.

                                       12
<PAGE>

         3.8 ADEQUACY OF THE COMPANY'S CAPITAL

         Each  Member  hereby  acknowledges  and  agrees  that  in the  Member's
considered opinion, the contributions, loans and guarantees provided for in this
Section 3 are  reasonably  sufficient  to meet the initial  capital needs of the
Company.

         3.9 NEGATIVE CAPITAL ACCOUNTS.

         No Member  shall be required to pay to any other  Member any deficit or
negative  balance  which may exist  from time to time in such  Member's  Capital
Account.  No Member  shall be liable to the  Company or any other  Member or any
creditor of the Company solely because of the existence of a negative balance in
such Member's Capital Account.

         3.10 REIMBURSEMENT OF EXPENSES

         If any Member or Manager  incurs a reasonable  expense on behalf of the
Company and reasonably  documents this expense to the Company, the Company shall
reimburse  the Member or Manager  for this  expense as  promptly  as  reasonably
possible after receiving this documentation.

         3.11 MEMBERS' REPRESENTATIONS AND WARRANTIES

         Each Member hereby  represents and warrants to and  acknowledges to the
Company  that:  (a) such  Member has  sufficient  knowledge  and  experience  in
financial and business matters and is capable of evaluating the merits and risks
of an investment in the Company and making an informed  investment decision with
respect thereto; (b) such Member is able to bear the economic and financial risk
of an  investment  in the Company  for an  indefinite  period of time;  (c) such
Member is acquiring  Membership Interests in the Company for investment purposes
only and not with a view to, or for resale in connection  with, any distribution
to the public or public offering thereof;  (d) the Membership Interests have not
been  registered  under the securities  laws of any  jurisdiction  and cannot be
disposed of unless  they are  subsequently  registered  and/or  qualified  under
applicable  securities  laws  or  are  exempt  from  any  such  registration  or
qualification  requirement  and the  provisions  of  this  Agreement  have  been
complied with; and (e) the execution, delivery and performance of this Agreement
do not require  such Member to obtain any consent or approval  that has not been
obtained and do not contravene or result in a default under any provision of any
existing  law or  regulation  applicable  to  such  Member  or  other  governing
documents or any  agreement or  instrument to which such Member is a party or by
which such Member is bound.

                                   SECTION 4
                          ALLOCATIONS AND DISTRIBUTIONS
4.1      GENERALLY

         Subject to Section 10.7, the Managers shall have sole  discretion as to
the amounts and timing of Distributions to Members, subject to the retention of,
or payment  to,  third  parties of such  funds as it shall deem  necessary  with
respect to the reasonable business needs of the Company, which shall include the
payment  or the  making  of  provision  for  the  payment  when  due of  Company
obligations,  including the payment of any management or administrative fees and
expenses or any other obligations.

                                       13
<PAGE>

         4.2 DISTRIBUTIONS

             Except as otherwise  provided in this Agreement, Distributions may
be made to Members from time to time in the discretion of the Managers.

             (a) Until the return to the Class B Members of one hundred  percent
(100%) of their  Capital  Contributions,  Distributions  to the Members shall be
made in proportion to each Member's respective  Percentage Interest as set forth
on EXHIBIT A attached hereto.

             (b) After the return to the Class B Member of one  hundred  percent
(100%) of their  Capital  Contributions,  Distributions  to the Members shall be
made in the following  proportion:  (i) twenty-five percent (25%) to the Class A
Members, and (ii) seventy-five percent (75%) to the Class B Members.

             (c) Distributions  made to Class A Members shall be allocated among
the Class A Members in  proportion to each Class A Member's  respective  Class A
Percentage  Interest,  and  Distributions  made to  Class  B  Members  shall  be
allocated  among the Class B Members  in  proportion  to each  Class B  Member's
respective Class B Percentage Interest.

         4.3 ALLOCATIONS OF PROFITS AND LOSSES.

             Profits  and Losses and all items of Company  income,  gain or loss
for any fiscal year shall be  allocated  among the Members in the same manner as
Distributions are allocated among the Members under Section 4.2, provided that:

             (a) if a Member makes a Capital  Contribution of non-cash  property
to the Company, the Company shall allocate its income, gains, deductions, losses
and other tax items to the  Member in respect of this  Capital  Contribution  in
accordance with Code Section 704 (c) (1) (A) and the regulations thereunder; and

             (b) if the  Company  allocates  any of its  Profits and Losses to a
Member  in  a  manner  that  is  disproportionate  to  the  Member's  respective
Percentage  Interest in the Company,  the Company shall make this  allocation in
compliance  with the  requirements  of Code Section  704(b) and the  regulations
thereunder.

For purposes of this Agreement: (i) an allocation of Company Profits to a Member
shall mean an  apportionment  of those  Profits on the books of the  Company for
Distribution  to  the  Member  upon  the  satisfaction  of  the  conditions  for
Distributions set forth in this Agreement,  and (ii) Capital Contributions shall
(except as  otherwise  expressly  provided in this  Agreement)  include only the
value of Capital  Contributions  that the Company has actually received from the
Members and has not returned.

                                       14
<PAGE>

         4.4 DISTRIBUTIONS IN KIND

         If this  Agreement  or  applicable  law  requires the Company to make a
Distribution to any Member,  the Member may not require the Company to make this
Distribution except in the form of cash, and the Company may not compel a Member
to accept a Distribution except in the form of cash.

         4.5 UNLAWFUL DISTRIBUTIONS

         The Company shall not make any Unlawful  Distributions of its assets to
any Member.  Except as otherwise provided under the Act, a Distribution shall be
an "Unlawful  Distribution" within the meaning of this Agreement if, immediately
after the Distribution,  the aggregate value of the Company's  liabilities would
exceed  the  aggregate  value  of  its  assets,  or  if,  as  a  result  of  the
Distribution,  the  Company  would be unable to pay its  reasonably  foreseeable
obligations as they become due.

         4.6 LIABILITY FOR UNLAWFUL DISTRIBUTIONS

         Members and Managers who vote to authorize  Unlawful  Distributions and
Members that receive these Distributions shall be liable as provided in the Act.

         4.7 MEMBERS AS CREDITORS OF THE COMPANY

         With respect to Profits allocated to a Member under this Agreement, the
Member shall have the status of a creditor.

                                   SECTION 5
                            MANAGEMENT OF THE COMPANY

         5.1 QUALIFICATIONS

         The  Managers  shall be Members of the  Company.  Managers  need not be
residents  of the  State  of  Delaware.  The  Managers  shall  have  such  other
qualifications  as are determined from time to time by the  affirmative  vote of
Members holding a majority of Member votes.

         5.2 TITLES

         In performing  management  functions for the Company,  Managers may use
the title  "Manager" or such other title or titles as the Members may  determine
from time to time by  affirmative  vote of Members  holding a majority of Member
votes.

         5.3 VOTING

         Except as otherwise  expressly provided herein, the Managers shall have
the right to vote on all matters pertaining to the business and internal affairs
of the Company. Each Manager shall have one vote on each matter, and each matter
shall be decided by the affirmative  vote of the Managers  holding a majority of
the votes. Each Manager shall have a reasonable  opportunity to be heard on each
matter on which the Managers vote. Managers may vote in person, by telephone, by

                                       15
<PAGE>

e-mail,  by fax or by any other  reasonable  means. The Managers shall appoint a
manager  to make a written  record of each  Manager  vote and to  circulate  the
record among the Managers promptly after the vote,  provided that the failure of
the manager to make or circulate  such a record shall not affect the validity of
any Manager vote.

         5.4 TIME DEVOTED BY MANAGERS.

         Each Manager shall devote to the Company such time and effort as may be
necessary for the proper performance of his, her or its duties hereunder.

         5.5 GENERAL RESPONSIBILITIES

         Except for  situations in which the approval of the Members is required
by this Agreement or by nonwaivable provisions of applicable law: (i) the powers
of the Company shall be exercised by or under the authority of, and the business
and  affairs  of the  Company  shall be  managed  under the  direction  of,  the
Managers;  and (ii) the Managers  shall make all  decisions and take all actions
regarding the business of the Company.  If the Managers consist of more than one
Manager,  the prior  consent or approval  of a majority  of all of the  Managers
shall be required for any action taken by any one or more Managers on behalf of,
or with respect to, the Company or its business or affairs.

         5.6 AUTHORITY

         Without  limiting the generality of Section 5.5 above, the Managers are
hereby authorized to:

                  (a)  execute  any and all  agreements,  contracts,  documents,
certifications  and  instruments  necessary or convenient in connection with the
management of the Company;

                  (b) engage in any kind of  activity  and perform and carry out
contracts of any kind  necessary  to, in  connection  with or  incidental to the
accomplishment  of the purposes of the Company as may be lawfully  carried on or
performed by a limited liability company under the laws of the State of Delaware
or of any other jurisdiction in which the Company conducts business;

                  (c) acquire by purchase,  lease, option,  capital contribution
or  otherwise,  any real,  personal or mixed  property or any interest  therein,
which may be necessary,  convenient,  or incidental to the accomplishment of the
purposes of the Company;

                  (d) sell,  assign,  exchange or otherwise transfer all or part
of the Company property;

                  (e)  issue  or sell to  Members,  affiliates  of  Members,  or
Persons  other  than  Members  or  affiliates  of  any  Member:  (i)  additional
Membership  Interests (including other classes or series of Membership Interests
having different rights);  (ii) obligations,  evidences of indebtedness or other
securities  convertible or  exchangeable  into Membership  Interests;  and (iii)

                                       16
<PAGE>

warrants,  options or other rights to purchase or otherwise  acquire  Membership
Interests,  and  no  Member  shall  have  any  preemptive  rights  in any of the
foregoing.

                  (f) borrow money  required for the business and affairs of the
Company,  and  issue  evidences  of  indebtedness  necessary,   convenient,   or
incidental to the  accomplishment of the purposes of the Company,  and to secure
the repayment of such borrowings by executing  mortgages or deeds of trust,  and
to pledge or  otherwise  encumber or subject to security  interests,  all or any
part of the Company's  property,  and in connection  with any such  borrowing to
confess judgment, or authorize the confession of judgment, against the Company;

                  (g) lend the Company's funds or make guarantees of obligations
of others upon such terms as the Managers shall determine;

                  (h)  invest  the  Capital  Contributions  of the  Members  and
reinvest the proceeds from the sale of any Company  property in such investments
and upon such terms as the Managers shall determine;

                                       17
<PAGE>

                  (i) dissolve the Company;

                  (j) prepay in whole or in part, refinance, increase, modify or
extend any  indebtedness or mortgage  affecting the Company's  property,  and in
connection  therewith to execute any extension or renewal of any indebtedness or
mortgage on any Company property;

                  (k)  place  record  title  to,  or the  right to use,  Company
property  in the  name or  names  of a  nominee  or  nominees  for  any  purpose
convenient or beneficial to the Company;

                  (l)  purchase  contracts  of  liability,  casualty,  and other
insurance deemed necessary, appropriate, or convenient for the protection of the
property or affairs of the Company or for any purpose  convenient  or beneficial
to the Company;

                  (m) employ,  engage and enter into  contracts  and  agreements
with Persons, firms or companies,  including entities in which any Member has an
interest,  in the  development,  operation,  and  management  of  the  Company's
property  and business on such terms and for such  compensation  as the Managers
may determine;

                  (n) retain counsel, accountants,  financial advisors and other
professional personnel;

                  (o) enter into,  make and perform such  contracts,  agreements
and  other  undertakings,  and do such  other  acts  as the  Managers  may  deem
necessary or advisable,  or as may be incidental to or necessary for the conduct
of the business of the Company;

                  (p) file Federal, state and local tax returns on behalf of the
Company and make such  elections  as are required or  permitted  under  Federal,
state, or local tax laws;

                  (q) designate the depository or depositories in which all bank
accounts  of the  Company  shall be kept and the  person or  persons  upon whose
signature or signatures withdrawals therefrom shall be made;

                  (r)  prosecute,   defend,  settle,  compromise  or  submit  to
arbitration,  any  suits,  actions,  or  claims at law or in equity to which the
Company  is a party or by which the  Company is  affected,  and  satisfy  out of
Company funds any judgment,  decree, or decision of any court, board, agency, or
authority having jurisdiction,  or any settlement of any suit, action, or claim;
and

                  (s)  engage in such  other  activities  and incur  such  other
expenses as may in the Managers'  judgment be necessary or  appropriate  for the
furtherance of the Company's purposes,  and to execute,  acknowledge and deliver
any and all instruments necessary to the foregoing.

                                       18
<PAGE>

5.7      ACTIONS BY MANAGERS; COMMITTEES; DELEGATION OF AUTHORITY AND DUTIES.

                  (a) In managing  the  business  and affairs of the Company and
exercising its powers, the Managers shall act: (i) collectively through meetings
and  written  consents  pursuant  to this  Section  5; (ii)  through  committees
pursuant to Section  5.7(b);  and (iii) through  Managers to whom  authority and
duties have been delegated pursuant to Section 5.7(c).

                  (b) The Managers may, from time to time, designate one or more
committees,  each of which shall be comprised of one or more Managers.  Any such
committee, to the extent provided in such resolution, in the Certificate or this
Agreement,  shall have and may exercise all of the authority of the Managers. At
every meeting of such committee,  the presence of a majority of all the Managers
that are Members thereof shall constitute a quorum,  and the affirmative vote of
a majority of the Managers  present  shall be necessary  for the adoption of any
resolution.  The  Managers  may  dissolve  any  committee  at any  time,  unless
otherwise provided in the Certificate or this Agreement.

                  (c) The Managers  may,  from time to time,  delegate to one or
more Managers such authority and duties as the Managers may deem  advisable.  In
addition,  the  Managers  may  assign  titles  (including,  without  limitation,
president,  vice  president,   secretary,  assistant  secretary,  treasurer  and
assistant  treasurer) to any such Managers and delegate to such Managers certain
authority and duties. Any number of titles may be held by the same Manager.  Any
delegation may be revoked at any time by the Managers,  and no delegation  shall
relieve the Managers of their management  responsibility under Section 5 of this
Agreement,  and any persons to whom the Managers  delegate  duties shall perform
them at the direction of the Managers.

         5.8 TAX IDENTIFICATION NUMBER, INSURANCE, BANK ACCOUNTS

         Before or promptly  after the Company  begins its business  activities,
the  Managers  shall (i) obtain  for the  Company a federal  tax  identification
number  and any  necessary  state  tax  identification  numbers,  (ii)  open any
necessary bank accounts for the Company, (iii) obtain on commercially reasonable
terms insurance  policies covering all reasonably  foreseeable  Company business
risks,  and (iv) do all other things  necessary or useful in connection with the
commencement of the Company's business.

         5.9 NUMBER AND TERM OF OFFICE.

         The number of Managers of the Company shall be determined  from time to
time by resolution of Members  holding a majority of votes.  If the Members make
no such  determination,  the number of Managers  shall be the number of Managers
constituting the initial  Managers.  Each Manager shall hold office for the term
for which he is  elected  and  thereafter  until his  successor  shall have been
elected and qualified, or until his earlier death,  resignation or removal.

         5.10 VACANCIES; REMOVAL; RESIGNATION.

                  (a) Any Manager position to be filled by reason of an increase
in the number of  Managers  or by other  reason may be filled by  election at an
annual or special  meeting of the  Members  called for that  purpose,  or by the
affirmative  vote of a majority  of the  remaining  Managers  though less than a
quorum of the Managers. A Manager elected to fill a vacancy occurring other than

                                       19
<PAGE>

by reason of an  increase  in the number of  Managers  shall be elected  for the
unexpired term of his predecessor in office.

                  (b) The Members may,  without  liability,  remove a Manager at
any time with or without cause by affirmative vote of Members holding a majority
of Member votes.

                  (c) A Manager may resign as a manager upon giving  thirty (30)
days'  written  notice to each  Member.  Except as  otherwise  provided  in this
Agreement,  the Manager  shall have no  liability to the Company or to the other
Members for any such resignation,  provided, however, that the resignation shall
not absolve the Manager from any liabilities arising on or before effective date
of the  resignation.  The acceptance of a resignation  shall not be necessary to
make it  effective,  unless  expressly  so  provided  in the  resignation.

         5.11 MEETINGS.

                  (a) A majority of the total number of Managers  fixed by or as
provided in this  Agreement  shall  constitute a quorum for the  transaction  of
business of the Managers, and the act of a majority of the Managers present at a
meeting at which a quorum is present shall be the act of the Managers. A Manager
who is present  at a meeting  of the  Managers  at which  action on any  Company
matter is taken  shall be presumed  to have  assented  to the action  unless his
dissent  shall be entered in the  minutes of the meeting or unless he shall file
his written  dissent to such action with the Person acting as a secretary of the
meeting  before the  adjournment  thereof or shall  deliver  such dissent to the
Company immediately after the adjournment of the meeting.  Such right to dissent
shall not apply to a Manager who voted in favor of such action.

                  (b)  Meetings  of the  Managers  may be held at such  place or
places as shall be  determined  from time to time by resolution of the Managers.
At all meetings of the Managers,  business  shall be transacted in such order as
shall from time to time be determined by resolution of the Managers.  Attendance
of a Manager at a meeting  shall  constitute a waiver of notice of such meeting,
except where a Manager attends a meeting for the express purpose of objecting to
the  transaction  of any business on the ground that the meeting is not lawfully
called or convened.

                  (c) In connection  with any annual meeting of Members at which
Managers were elected, the Managers may, if a quorum is present,  hold its first
meeting for the transaction of business  immediately after and at the same place
as such annual  meeting of the Members.  Notice of such meeting at such time and
place shall not be required.

                  (d)  Regular  meetings of the  Managers  shall be held at such
times and places as shall be  designated  from time to time by resolution of the
Managers. Notice of such meetings shall not be required.

                  (e)  Special  meetings  of the  Managers  may be called by any
Manager on at least 24 hours' notice to each other Manager. Such notice need not
state the purpose or purposes  of, nor the  business to be  transacted  at, such
meeting,  except as may  otherwise  be required  by law or provided  for in this
Agreement.

                                       20
<PAGE>

         5.12 APPROVAL OR RATIFICATION OF ACTS OR CONTRACTS BY MEMBERS.

         The  Managers in their  discretion  may submit any act or contract  for
approval or ratification at any annual meeting of the Members, or at any special
meeting of the  Members  called for the purpose of  considering  any such act or
contract,  and any act or  contract  that shall be  approved  or be  ratified by
Members  holding a majority of votes  shall be as valid and as binding  upon the
Company and upon all the  Members as if it shall have been  approved or ratified
by every Member of the Company.

         5.13 ACTION BY WRITTEN CONSENT OR TELEPHONE CONFERENCE.

         Any action  permitted or required by the Act, the  Certificate  or this
Agreement to be taken at a meeting of the Managers or any  committee  designated
by the Managers may be taken without a meeting if a consent in writing,  setting
forth the action to be taken, is signed by a majority of the Managers or members
of such  committee,  as the case may be. Such consent  shall have the same force
and  effect as a  unanimous  vote at a meeting  and may be stated as such in any
document  or  instrument  filed  with the  Secretary  of  State of the  State of
Delaware,  and the  execution of such consent  shall  constitute  attendance  or
presence in person at a meeting of the  Managers or any such  committee,  as the
case may be.  Subject to the  requirements  of the Act, the  Certificate or this
Agreement  for  notice  of  meetings,   unless   otherwise   restricted  by  the
Certificate, Managers or members of any committee designated by the Managers may
participate  in and hold a meeting of the Managers or any committee of Managers,
as the case may be, by means of a conference telephone or similar communications
equipment  by means of which all Persons  participating  in the meeting can hear
each other, and  participation  in such meeting shall constitute  attendance and
presence in person at such meeting,  except where a Person  participates  in the
meeting for the express  purpose of objecting to the transaction of any business
on the  ground  that the  meeting  is not  lawfully  called  or  convened.

         5.14 COMPENSATION AND EXPENSES.

         The  Managers  shall  receive  such  compensation,  if any,  for  their
services as may be designated from time to time by the Members. In addition, the
Managers shall be entitled to be reimbursed for out-of-pocket costs and expenses
incurred  in the course of their  service  hereunder,  including  the portion of
their overhead reasonably allocable to Company activities.

         5.15 OFFICERS.

                  (a) The Managers may, from time to time, designate one or more
Persons to be  officers  of the  Company.  No officer  need be a resident of the
State of Delaware,  a Member or a Manager. Any officers so designated shall have
such  authority  and perform such  ministerial  duties as the Managers may, from
time to time,  delegate  to  them,  subject  to the  authority  of the  Managers
provided in Section 5.7. The Managers may assign titles to particular  officers.
Each officer shall hold office until his successor  shall be duly designated and
shall  qualify  or until his death or until he shall  resign or shall  have been
removed in the manner hereinafter provided. Any number of offices may be held by
the same person. The salaries or other compensation, if any, of the officers and
agents of the Company shall be fixed from time to time by the Managers.

                  (b)  Any  officer  may  resign  as  such  at  any  time.  Such
resignation shall be made in writing and shall take effect at the time specified
therein, or if no time be specified, at the time of its receipt by the Managers.
The  acceptance  of a  resignation  shall not be necessary to make it effective,
unless expressly so provided in the  resignation.  Any officer may be removed as
such,  either with or without cause, by the Managers  whenever in their judgment

                                       21
<PAGE>

the best  interests of the Company will be served  thereby;  provided,  however,
that such removal shall be without  prejudice to the contract rights, if any, of
the Person so  removed.  Designation  of an officer  shall not of itself  create
contract  rights.  Any  vacancy  occurring  in any office of the  Company may be
filled by the Managers.

         5.16 COMPLIANCE WITH LAWS AND REGULATIONS

         Before  the  Company  conducts  business  in this State or in any other
state and at all times while it is conducting this business,  the Managers shall
ensure that the Company is in compliance with all applicable federal,  state and
local laws,  regulations  and  ordinances,  including  federal and state tax and
securities  laws,  laws  governing  the  registration  and  taxation  of foreign
Companies,   and  regulations   governing  specific   professions,   trades  and
businesses.  For purposes of this Agreement,  "state" shall include the District
of Columbia.

         5.17 VALUATION OF CAPITAL CONTRIBUTIONS

         Whenever the Company  admits a Person as a Member of the  Company,  the
Managers  shall   promptly   determine  in  dollars  a  value  for  the  Capital
Contribution of that Person in exchange for the Person's  Membership Interest or
that there was no Capital  Contribution,  shall record this determination in the
records of the Company,  and shall  promptly  notify all Members  concerning the
determination.  Thereafter,  in the absence of fraud, the determination shall be
conclusive  as to the value of the Capital  Contribution  or as to whether there
was a Capital Contribution.

                                       22
<PAGE>

         5.18 THIRD PARTY CLAIMS AGAINST THE COMPANY

         No Manager in the  Manager's  capacity as a manager shall have personal
liability for any claim against the Company by any third party.  Managers  shall
be personally liable for their personal misconduct as provided by this Agreement
and by applicable law.

         5.19 EXCLUSIVE RIGHT TO BIND THE COMPANY

         Only the Managers shall have the following rights:

                  (a) Each  Manager  shall have the right to bind the Company in
dealings with third parties.

                  (b) The Managers shall have the exclusive  right to decide all
Company  matters  relating to the business of the Company except those that this
Agreement expressly reserves to the Members.

                  (c) The Managers  shall have the right to conduct the business
and internal affairs of the Company.

         5.20 RELIANCE ON COMPANY INFORMATION AND OTHER COMPANY MANAGERS

         No Manager as a manager shall be personally liable to the Company or to
the Members if, to the extent that, with respect to the matter in question,  the
Manager acted in reasonable reliance on Company records, other Company Managers,
employees or officers of the Company,  other  Persons  whom,  at the time of the
action,  the  Manager  reasonably  believed  to be  competent  in the  matter in
question, or any provision of this Agreement.

         5.21 NO MANAGER LIABILITY FOR ACTIONS TAKEN IN GOOD FAITH

         No Manager shall be personally  liable to the Company or to the Members
if, with respect to the matter in question,  the Manager acted in good faith, in
the  reasonable  belief that the action was in the best interest of the Company,
and with reasonable diligence.

         5.22 LIABILITY INSURANCE FOR MANAGERS

         The Company shall maintain an insurance policy to cover  liabilities of
a Manager  arising  from a claim  against the Manager  under or relating to this
Agreement  (to the extent  permitted by the Act and  applicable  law) if Members
holding a majority of Member votes agree to do so.

         5.23 ADVANCEMENT OF ARBITRATION AND LITIGATION EXPENSES TO MANAGERS

         The Company  shall advance  arbitration  and  litigation  expenses to a
Manager  for the defense of claims  against a Manager  under or relating to this
Agreement if Members  holding a majority of Member votes agree to do so, and the
Manager  promises  to return  all such  advances  to the  Company  if the court,
arbitrator or other relevant tribunal determines that the claim is valid.

                                       23
<PAGE>

         5.24 EXECUTION OF THIS AGREEMENT

         As a condition  to becoming  Managers,  the  initial  Managers  and all
subsequent  Managers shall sign this Agreement in their capacity as managers and
shall be bound by all provisions of the Agreement relating to managers.

                                   SECTION 6
                    MANAGERS' REPRESENTATIONS AND WARRANTIES

         6.1 REPRESENTATIONS BY ALL MANAGERS

         Each  Manager  warrants  in the  Manager's  capacity  as a  manager  as
follows:

                  (a) The Manager is legally  free to enter into this  Agreement
and to perform the Manager's obligations under this Agreement in accordance with
its  terms  and is not  prevented  from  doing so by order of any court or other
governmental  authority,  by any  agreement  with a third  party  (including  an
employment agreement,  non-competition  agreement or nondisclosure agreement) or
by any other cause.

                  (b) In  negotiating  and  entering  into this  Agreement,  the
Manager has acted fairly and in good faith.

                  (c) Before accepting the terms of this Agreement,  the Manager
has had every reasonable  opportunity to consider these terms and to review them
with the Manager's personal attorney.

                  (d) The  Manager  has  accepted  the  terms of this  Agreement
knowingly and freely.

         6.2 REPRESENTATIONS BY CORPORATE MANAGER

         If the Manager is an entity,  the Manager  represents and warrants,  in
addition to its  representations  and  warranties  under Section 6.1, that it is
duly formed,  organized and existing under its state of  incorporation,  and has
full  corporate  authority  and all necessary  authorization  to enter into this
Agreement and to perform its duties  hereunder in  accordance  with the terms of
this Agreement.

                                   SECTION 7
                     CONFIDENTIALITY OF COMPANY INFORMATION

         7.1 CONFIDENTIALITY OF COMPANY INFORMATION

         The  Managers  shall  use  every   reasonable  means  to  maintain  the
confidentiality  of Confidential  Information.  Except as required in conducting
the business and internal affairs of the Company or by federal or state law, the
Managers  shall  not  disclose  Confidential  Information  to any  third  party.
Promptly after ceasing to be managers,  the managers shall return to the Company
all  documents  and other  media in their  possession  or control  that  contain
Confidential Information.

                                       24
<PAGE>

         7.2 EXCEPTIONS TO DUTY OF CONFIDENTIALITY

         Section 7.1 shall not apply to the following types of information:

                  (a) Information already lawfully possessed by a Manager before
its  disclosure  to the Manager  lawfully  obtained  from  another  source after
receiving it from the Company.

                  (b)  Information  that is already in the public  domain at the
time of its  disclosure  to the  Manager  or that  thereafter  enters the public
domain through no fault of the Manager.

                  (c) Information  whose  disclosure is permitted or required by
final order of a court of competent jurisdiction.

                  (d)  Information  whose  disclosure is made on a  confidential
basis to an arbitrator in an arbitration under Section 14; and

                  (e) Information the Company discloses  without  restriction to
any Person other than the Manager.

         7.3 BINDING EFFECT; TERMINATION

         This  Section 7 shall  bind each  recipient  even  after the  recipient
ceases to be a Manager,  and shall  terminate upon the  termination of the legal
existence of the Company.

                                   SECTION 8
                              COMPANY RECORDS, ETC.

         8.1 INFORMATION AND RECORDS MAINTAINED BY THE COMPANY

         The Company  shall  maintain  at its  principal  place of business  the
following types of records and information:

                  (a) True and full  information  regarding  the  status  of the
business and financial condition of the Company;

                  (b)  Promptly  after  they  become  available,  copies  of its
federal, state and local income tax returns for each year;

                  (c) A  current  list of the  name  and  last  known  business,
residence or mailing address of each Member of the Company;

                  (d) A copy of its  Certificate  and this  Agreement and of all
amendments  thereto,  together  with  executed  copies of any written  powers of
attorney pursuant to which the Certificate and this Agreement and all amendments
thereto have been executed;

                  (e) True and full information regarding the amount of cash and
a  description  and  statement  of the  agreed  value of any other  property  or
services  contributed  by each  Member to the  Company and which each Member has

                                       25
<PAGE>

agreed to contribute  in the future,  and the date on which each Member became a
member of the Company; and

                  (f) Other  information  regarding  the  affairs of the Company
that is just and reasonable.

         8.2 BOOKS OF ACCOUNT

         The Company shall maintain books of account concerning the business and
affairs of the Company that are accurate,  reasonably current, and in compliance
with  financial  and other  standards  normally  applicable  to the  records  of
business  organizations  generally  similar to the Company in size and  business
activities.

         8.3 INSPECTION OF RECORDS.

         During normal business hours and after reasonable  notice,  each Member
shall be entitled, for any purpose reasonably related to the Member's membership
in the Company,  to inspect and, at the Member's expense,  to copy any documents
and other media in the Company's possession or control,  including the documents
identified in Section 8.1, provided that all information available to the Member
under this  Section 8 shall be subject to the  provisions  of Section 7, and all
applicable federal and state laws and regulations, including laws concerning the
privacy of employee medical information.

                                   SECTION 9
                         EXCULPATION AND INDEMNIFICATION

         9.1 EXCULPATION.

         No  Manager  shall be liable to any other  Manager,  any  Member or the
Company for any loss  suffered by the Company  unless such loss is caused by the
Manager's gross  negligence,  willful  misconduct,  violation of law or material
breach of this Agreement. The Manager shall not be liable for errors in judgment
or for any acts or omissions that do not constitute  gross  negligence,  willful
misconduct,  violation of law or material breach of this Agreement.  The Manager
may consult  with  counsel and  accountants  in respect of Company  affairs and,
provided the Manager acts in good faith  reliance  upon the advice or opinion of
such  counsel  or  accountants,  the  Manager  shall not be liable  for any loss
suffered by the Company in reliance thereon.

         9.2 INDEMNIFICATION.

         Subject to the  limitations  and conditions as provided in this Section
9, each Person who was or is made a party to or is threatened to be made a party
to, or is involved  in any  threatened,  pending or  completed  action,  suit or
proceeding, whether civil, criminal, administrative,  arbitrative (hereinafter a
"Proceeding"),   or  any  appeal  in  such  a  Proceeding   or  any  inquiry  or
investigation  that could lead to such a Proceeding,  by reason of the fact that
he, she or it, or a Person of whom he, she or it is the legal representative, is
or was a Manager or officer of the  Company or while a Manager or officer of the

                                       26
<PAGE>

Company is or was serving at the request of the Company as a Manager,  director,
officer, partner,  venturer,  proprietor,  trustee,  employee, agent, or similar
functionary  of  another  foreign  or  domestic   limited   liability   company,
corporation,  partnership,  joint venture, sole proprietorship,  trust, employee
benefit  plan or other  enterprise  shall be  indemnified  by the Company to the
fullest  extent  permitted  by the Act,  as the same exist or may  hereafter  be
amended  (but, in the case of any such  amendment,  only to the extent that such
amendment  permits the Company to provide  broader  indemnification  rights than
said law  permitted  the  Company to provide  prior to such  amendment)  against
judgments,  penalties (including excise and similar taxes and punitive damages),
fines,  settlements  and reasonable  expenses  (including,  without  limitation,
attorneys'  fees)  actually  incurred  by such  Person in  connection  with such
Proceeding,  and  indemnification  under this  Section 9 shall  continue as to a
Person who has ceased to serve in the capacity  which  initially  entitled  such
Person to indemnity  hereunder.  The rights  granted  pursuant to this Section 9
shall be deemed  contract  rights,  and no amendment,  modification or repeal of
this Section 9 shall have the effect of limiting or denying any such rights with
respect  to  actions  taken  or  Proceedings  arising  prior  to any  amendment,
modification or repeal. It is expressly  acknowledged  that the  indemnification
provided in this Section 9 could involve indemnification for negligence or under
theories of strict liability.

         9.3 ADVANCE PAYMENT.

         The right to indemnification  conferred in this Section 9 shall include
the right to be paid or  reimbursed by the Company for the  reasonable  expenses
incurred by a Person of the type  entitled to be  indemnified  under Section 9.2
who was or is, or is threatened to be made, a named defendant or respondent in a
Proceeding in advance of the final disposition of the Proceeding and without any
determination  as to  the  Person's  ultimate  entitlement  to  indemnification;
provided, however, that the payment of such expenses incurred by any such Person
in  advance of the final  disposition  of a  Proceeding  shall be made only upon
delivery to the Company of a written  affirmation by such Manager of his, her or
its  good  faith  belief  that he,  she or it has met the  standard  of  conduct
necessary for indemnification under this Section 9 and a written undertaking, by
or on behalf  of such  Person,  to repay all  amounts  so  advanced  if it shall
ultimately  be  determined  that such  indemnified  Person is not entitled to be
indemnified under this Section 9 or otherwise.

         9.4 APPEARANCE AS A WITNESS.

         Notwithstanding  any other provision of this Section 9, the Company may
pay or reimburse  expenses  incurred by a Manager or officer in connection  with
his  appearance  as a witness or other  participation  in a Proceeding at a time
when the  Manager or  officer  is not a named  defendant  or  respondent  in the
Proceeding.

         9.5 INSURANCE.

         The Company may  purchase and maintain  insurance,  at its expense,  to
protect  itself and any Person who is or was serving as a Manager,  officer,  or
agent of the  Company or is or was  serving at the  request of the  Company as a
Manager, director,  officer, partner, venturer,  proprietor,  trustee, employee,
agent or similar  functionary of another foreign or domestic  limited  liability
company, corporation,  partnership,  joint venture, sole proprietorship,  trust,
employee  benefit plan or other  enterprise  against any  expense,  liability or
loss,  whether or not the Company would have the power to indemnify  such Person
against such expense, liability or loss under this Section 9.

                                       27
<PAGE>

         9.6 NONEXCLUSIVITY OF RIGHTS.

         The  right  to  indemnification  and the  advancement  and  payment  of
expenses  conferred  in this Section 9 shall not be exclusive of any other right
which a Manager or other Person indemnified  pursuant to this Section 9 may have
or  hereafter  acquire  under any law (common or  statutory),  provision  of the
Certificate  or this  Agreement,  agreement,  vote of  Members or  Managers,  or
otherwise.

         9.7 SAVINGS CLAUSE.

         If this  Section 9 or any portion  hereof shall be  invalidated  on any
ground  by  any  court  of  competent  jurisdiction,   then  the  Company  shall
nevertheless  indemnify  and hold  harmless  each  Manager  or any other  Person
indemnified  pursuant  to this  Section  9 as to  costs,  charges  and  expenses
(including  attorneys'  fees),  judgments,  fines and amounts paid in settlement
with  respect  to any  action,  suit or  proceeding,  whether  civil,  criminal,
administrative  or  investigative to the full extent permitted by any applicable
portion  of this  Section  9 that  shall not have  been  invalidated  and to the
fullest extent permitted by applicable law.

                                   SECTION 10
                           TAX PLANNING AND COMPLIANCE

         10.1 TAXATION OF THE COMPANY AND MEMBERS

         Under federal tax law and to the maximum extent  possible under the tax
laws of each state and the  District  of  Columbia,  the Company and its Members
shall be  taxable as a  partnership  and as  partners.  The  provisions  of this
Agreement  shall be  construed  and  applied in such a manner as to ensure  full
compliance  with the  provisions  of the Code  applicable  to  partnerships  and
partners and with the regulations thereunder.

         10.2 TAX MANAGEMENT AND COMPLIANCE

         The parties  acknowledge  the importance to the Company and the Members
of competent  tax  planning for the Company and for the Members as members,  and
full  compliance  by the Company and by the Members  with  federal and state tax
requirements  applicable  to the Company  and the  Members in their  capacity as
such.

         10.3 APPOINTMENT AND REPLACEMENT OF COMPANY TAX ADVISER

         In connection with its formation and on a continuing basis  thereafter,
the  Members  may  appoint a tax  adviser.  This  individual  or firm shall have
expertise in all areas of tax practice  relevant to the needs of the Company and
its  Members  in their  capacities  as such and in  particular  in the  field of
federal partnership taxation.  The Members may replace the Company's tax adviser
from time to time upon the  affirmative  vote of Members  holding a majority  of
Member votes.

                                       28
<PAGE>

         10.4 COOPERATION WITH TAX ADVISER

         The  parties  shall  cooperate  with the  Company's  tax adviser to the
maximum  extent   reasonable  to  ensure  adequate   Company  tax  planning  and
compliance.

         10.5 TAX MATTERS PARTNER

         The Members by affirmative vote of Members holding a majority of Member
votes may appoint a Manager to serve as the  Company's  tax matters  partner for
purposes of unified  administrative  and judicial federal tax proceedings  under
Code Section 6231 (a) (1).

         10.6 PLANNING OF INDIVIDUAL TRANSACTIONS

         Before  undertaking any major transaction  involving the Company or any
Member in the  Member's  capacity as a member,  the  Company  and each  affected
Member shall consult with one or more partnership tax experts concerning the tax
implications of the transaction, and the Company and affected Members shall make
any tax elections and shall take any other actions  necessary or  appropriate in
the circumstances to ensure tax compliance and maximum lawful tax avoidance. The
issue of the fairness of the transaction to the Company and to the Members shall
be subject to arbitration under Section 14.

         10.7 TAX DISTRIBUTIONS

        If any  Member  requires  a  Distribution  of all or any  portion of the
Member's share of Company Profits in order to pay the Member's  federal or other
taxes on the Member's  share of these Profits for any taxable year,  the Company
shall, to the extent that its financial condition reasonably permits,  make this
Distribution  to the Member on a timely basis,  provided that as a condition for
the   Distribution,   the  Company   may,   under   reasonable   conditions   of
confidentiality,  require the Member to disclose  to the  Company's  tax adviser
relevant information concerning the Member's tax and financial affairs.

         10.8 TAX RETURNS

         The Company shall  accurately  complete and file its federal tax return
and all applicable state returns on a timely basis each year.

         10.9 PROVISION OF TAX INFORMATION TO MEMBERS

         As soon as reasonably  possible  after the close of each of its taxable
years,  the Company shall provide each Member with  completed  federal and state
tax forms and with all other documents and  information  relevant to the federal
and state tax  liabilities  of the Member as a member of the  Company,  provided
that each Member shall have sole  responsibility for preparing and timely filing
the Member's  federal and state tax returns and for paying the  Member's  taxes,
and the Company shall have no  responsibility or liability with respect to these
matters.

                                       29
<PAGE>

         10.10 COMPUTATION AND RECORDING OF MEMBERS' CONTRIBUTIONS

         The Company shall maintain current and accurate records concerning each
Member's Capital Contributions and adjusted tax basis in the Member's Membership
Interest in accordance with applicable U.S. Treasury Department regulations and,
promptly after the request of any Member,  shall make these records available to
the Member.

                                   SECTION 11
                              MEMBER DISSOCIATIONS

         11.1 EVENTS OF DISSOCIATION

         A Member  shall be  dissociated  only if the  Member  dies (or,  if the
Member is an entity,  it incurs a dissolution or equivalent  event),  the Member
resigns in  accordance  with  Section  11.4,  or the Member  sells or  otherwise
transfers all of the Member's Management Rights.

         11.2 CERTAIN CONSEQUENCES OF DISSOCIATION

         Except as otherwise expressly provided in this Agreement,  a Member who
is  dissociated  from the Company  shall  immediately  lose all of the  Member's
Management Rights.

         11.3 NO DISTRIBUTIONS TO DISSOCIATED MEMBERS

         Except as otherwise provided in this Agreement, a Member's dissociation
shall not entitle the Member to receive any  Distribution  of Company Profits or
other assets or to receive any payment for the Member's Membership Interest.

         11.4 RIGHT OF MEMBERS TO RESIGN FROM COMPANY; NOTICE OF RESIGNATION

         A Member may  without  liability  resign as a member of the  Company by
giving written notice of resignation to the other Members. The resignation shall
be effective  sixty (60) days after all of the other  Members have  received the
notice.

         11.5 EFFECTIVE DATE OF RESIGNATION

         A Member shall be deemed to have resigned  from the Company  within the
meaning of this Section 11 on the  effective  date of the notice of  resignation
described in Section 11.4. For purposes of this Section 11, the resignation of a
Member  means the  Member's  voluntary  renunciation  of the  Member's  right to
participate in the business and internal affairs of the Company.

                                       30
<PAGE>

                                   SECTION 12
              DISSOLUTION; MERGERS, CONVERSIONS AND SALES OF ASSETS

         12.1 DISSOLUTION

         The Company  shall be dissolved  upon the  affirmative  vote of Members
holding a majority of Member votes,  upon the expiration of the period fixed for
the duration of the Company set forth in the  Certificate,  upon the issuance of
an order of  dissolution by a court or by the Secretary of State of the State of
Delaware, or upon the issuance of an order of dissolution by an arbitrator under
Section 14.

         12.2 LIQUIDATION AND TERMINATION.

        On dissolution of the Company, the Managers shall act as liquidator. The
Managers shall proceed diligently to wind up the affairs of the Company and make
final  Distributions as provided herein and in the Act. The costs of liquidation
shall be borne as a Company  expense.  Until final  Distribution,  the  Managers
shall  continue  to operate  the  Company  properties  with all of the power and
authority of the Managers.  The steps to be  accomplished by the Managers are as
follows:

                  (a) as promptly as possible after  dissolution and again after
final liquidation,  the Managers shall cause a proper accounting to be made by a
recognized  firm  of  certified  public  accountants  of the  Company's  assets,
liabilities,  and operations through the last day of the calendar month in which
the dissolution occurs or the final liquidation is completed, as applicable;

                  (b) the Managers  shall cause the notice  described in Section
18-203 of the Act to be mailed to each known  creditor of and  claimant  against
the Company in the manner described in such section;

                  (c) the Managers shall pay,  satisfy or discharge from Company
funds all of the debts,  liabilities and obligations of the Company  (including,
without  limitation,  all expenses  incurred in  liquidation)  or otherwise make
adequate  provision  for  payment  and  discharge  thereof  (including,  without
limitation,  the establishment of a cash escrow fund for contingent  liabilities
in such amount and for such term as the Managers may reasonably determine); and

                  (d) all remaining  assets of the Company shall be  distributed
to the Members as follows:

                           (i)  the   Managers  may  sell  any  or  all  Company
                  property, including to Members, and any resulting gain or loss
                  from each sale shall be computed and  allocated to the Capital
                  Accounts of the Members;

                           (ii) with  respect to all Company  property  that has
                  not been sold, the fair market value of that property shall be
                  determined  and the Capital  Accounts of the Members  shall be

                                       31
<PAGE>

                  adjusted to reflect the manner in which the unrealized income,
                  gain,  loss,  and deduction  inherent in property that has not
                  been  reflected in the Capital  Accounts  previously  would be
                  allocated   among  the   Members   if  there  were  a  taxable
                  disposition of that property for the fair market value of that
                  property on the date of Distribution; and

                           (iii) Company property shall be distributed among the
                  Members  in  accordance  with  the  positive  Capital  Account
                  balances  of the  Members,  as  determined  after  taking into
                  account all Capital  Account  adjustments for the taxable year
                  of the Company  during  which the  liquidation  of the Company
                  occurs (other than those made by reason of this clause (iii));
                  and  those  Distributions  shall  be  made  by the  end of the
                  taxable year of the Company  during which the  liquidation  of
                  the Company  occurs (or, if later,  ninety (90) days after the
                  date of the liquidation).

All  Distributions in kind to the Members shall be made subject to the liability
of each distributee for costs, expenses, and liabilities theretofore incurred or
for which the Company has committed  prior to the date of termination  and those
costs,  expenses, and liabilities shall be allocated to the distributee pursuant
to this Section 12.2. The  Distribution  of cash and/or  property to a Member in
accordance  with the  provisions  of this  Section 12.2  constitutes  a complete
return to the Member of its Capital Contributions and a complete Distribution to
the Member of its  interest in the Company and all the  Company's  property  and
constitutes a compromise to which all Members have consented  within the meaning
of the Act. To the extent that a Member returns funds to the Company,  it has no
claim against any other Member for those funds.

         12.3 EFFECTIVE DATE OF DISSOLUTION

         The dissolution of an Company by vote of the Members shall be effective
on the date  specified  in that vote or, if the  Members do not  specify a date,
then on the date of completion of the vote.

         12.4 CESSATION OF COMPANY'S LEGAL EXISTENCE

         Unless a court or administrative  authority duly and finally determines
otherwise,  on  completion  of the  Distribution  of Company  assets as provided
herein,  the Company is  terminated,  and the  Managers (or such other Person or
Persons  as  the  Act  may  require  or  permit)  shall  file a  certificate  of
cancellation  with the  Secretary of State of the State of Delaware,  cancel any
other  filings made pursuant to this  Agreement,  and take such other actions as
may be necessary to terminate the Company.

         12.5 DISSOLUTION BY ARBITRATOR

         Upon petition by any Member,  an arbitrator  under Section 14 may issue
an order dissolving the Company on one or more of the following grounds:

                                       32
<PAGE>

                  (a) the Company obtained its Certificate through fraud;

                  (b) the  Company  exceeded or abused the  authority  conferred
upon it by law;

                  (c) the  Company  conducted  its  business  in a  persistently
fraudulent or illegal manner;

                  (d) the Company abused its power contrary to the public policy
of this State;

                  (e) A deadlock exists on a matter involving Company management
which the Members are unable to resolve and which is causing or which  threatens
to cause irreparable  injury to the Company or which prevents it from conducting
its business or affairs to its advantage;

                  (f) The  dissolution  of the Company is reasonable and fair in
the circumstances.

         12.6  EXCLUSION  OF  CERTAIN  MANAGERS  FROM  PARTICIPATION  IN WIND-UP
PROCESS

         Any Member may petition an  arbitrator  under Section 14 to exclude one
or more Managers from participating in the process of winding up and liquidating
the Company on the ground that,  because of past wrongful conduct by the Manager
or  Managers in  question,  their  participation  would be likely to affect that
process adversely.

         12.7 WINDING-UP OF THE COMPANY

         After the Company is dissolved, the Managers responsible for winding up
the Company shall as expeditiously  as reasonably  possible wind up its business
and internal affairs, and cause its liquidation.  During the wind-up period, the
Company shall accept no new business  except to the extent  necessary to dispose
of existing inventory.

         12.8 LIQUIDATING DISTRIBUTIONS BY THE COMPANY

         The Company shall make  Distributions  of its assets in connection with
its  liquidation  in accordance  with the provisions of Section 4, provided that
the Company shall make no  Distribution  to Members or others in connection with
its  liquidation  until it has complied with all applicable laws and regulations
of this State (including tax laws and  regulations)  relating to its dissolution
and liquidation.

         12.9 DEFICIT CAPITAL ACCOUNTS.

        Notwithstanding  anything to the contrary  contained in this  Agreement,
and  notwithstanding  any custom or rule of law to the  contrary,  to the extent
that the deficit,  if any, in the Capital  Account of any Member results from or
is  attributable  to deductions  and losses of the Company  (including  non-cash
items  such  as  depreciation),  or  Distributions  of  money  pursuant  to this
Agreement to all Members in proportion to their respective Membership Interests,
upon  dissolution  of the  Company  such  deficit  shall  not be an asset of the
Company and such Members shall not be obligated to contribute such amount to the
Company to bring the balance of such Member's Capital Account to zero.

                                       33
<PAGE>

         12.10 DISPOSITION OF KNOWN AND UNKNOWN CLAIMS AGAINST COMPANY

         Promptly after the  dissolution of the Company,  the Company shall take
all reasonable  measures under the laws of this State to dispose of (and, to the
extent reasonable, to bar) known and unknown claims against the Company.

         12.11  DUTY  TO  CONSULT  TAX  ADVISER  IN   CONNECTION   WITH  COMPANY
DISSOLUTION

         Before the Members  begin the wind-up and  liquidation  of the Company,
the Company and the Members shall consult with their respective tax advisers and
shall  structure and implement  the  liquidation  in a manner that is as fair as
possible to each Member from a tax viewpoint.

         12.12 MERGERS, CONVERSIONS AND SALES OF ASSETS

         The Company  shall not  participate  in a merger,  change its  business
organization  form, or sell all or  substantially  all of its assets outside the
ordinary  course of  business  except  with the  consent  of  Members  holding a
majority of membership votes.

                                   SECTION 13
                        TERM AND TERMINATION OF AGREEMENT

         13.1 TERM AND TERMINATION

         Subject to the  provision of Sections  13.2 and 13.3,  the term of this
Agreement  shall begin on the Effective Date and,  unless earlier  terminated by
the parties, shall terminate as follows:

                  (a) If the Company is  terminated  by vote of the Members,  it
shall  terminate on the effective date of the certificate of cancellation of the
Company's Certificate.

                  (b)  If  the  Company  is  terminated  by  decree  of  a  duly
authorized  judicial or administrative  authority or by an arbitrator,  it shall
terminate on the date of termination of the Company's existence as determined by
that authority or arbitrator.

                  (c) If no clear date is established under Sections 13.1 (a) or
(b) and if the Members cannot agree on such a date, it shall  terminate upon the
determination of an arbitrator under Section 14.

         13.2 SURVIVAL OF ACCRUED RIGHTS

         Rights,  duties  and  liabilities  accrued  by the  parties  under this
Agreement  before its termination  shall continue in full force and effect after
its termination.

                                       34
<PAGE>

         13.3 ARBITRATION OF MATTERS RELATING TO COMPANY'S WINDING-UP, ETC.

         Notwithstanding the termination of this Agreement, any party may, after
that  termination,  initiate an  arbitration  under  Section 14 to determine and
enforce  rights and duties of the party  relating to matters  arising before and
during the Company's winding-up, the Company's liquidation,  and matters arising
after the cancellation of the Company's Certificate.

                                   SECTION 14
                         ARBITRATION OF COMPANY DISPUTES

         14.1 MANDATORY ARBITRATION OF CERTAIN DISPUTED MATTERS

         Except as provided  herein,  any  dispute  between or among the parties
relating to arbitrable  matters  shall be  exclusively  and finally  resolved in
arbitration by a single arbitrator without recourse to any court.

         14.2 MATTERS NOT SUBJECT TO ARBITRATION

         Arbitration  shall not be used to resolve routine  business  matters of
the Company,  matters requiring urgent judicial relief, or matters involving the
enforcement of orders under this Section 14.

         14.3 RULES GOVERNING ARBITRATION

         Except as otherwise  provided in this Section,  any  arbitration  under
this section  shall be governed by the Rules of  Commercial  Arbitration  of the
American  Arbitration  Association  ("AAA")  as in  effect  at the  time  of the
arbitration.

         14.4 NOTICE OF ARBITRATION

         Any Member may  initiate  an  arbitration  of any matter not subject to
arbitration  under  Section  14.2 above.  The  initiating  Member shall do so by
providing  written notice of the  arbitration  to the other Members.  The notice
shall bear a current  date,  shall state the name of the  initiating  Member and
shall briefly state the matter to be arbitrated.

         14.5 SELECTION OF ARBITRATOR

         If, within fifteen (15) business days after all the parties entitled to
notice of an arbitration have received that notice,  the Members have not agreed
among  themselves  as to the  identity  of the  arbitrator  or the  site  of the
arbitration, the Company shall immediately refer these matters for resolution by
the AAA office  located in the city of  Philadelphia.  That  office may  resolve
these matters without liability and in its sole discretion.

         14.6 NO APPEAL

         No Member  shall  appeal to any court an order of an  arbitrator  under
this Section 14. The Company or any Member may enter any such order in any court
of competent jurisdiction.

                                       35
<PAGE>

         14.7 ALLOCATIONS OF COSTS AND FEES

         The arbitrator may allocate among the Members the costs, fees and other
expenses  relating to an  arbitration  in any manner that the  arbitrator  shall
determine to be appropriate in his or her absolute discretion,  provided that if
the arbitrator  determines  that a party has initiated an arbitration  without a
reasonable  basis for doing so, the  arbitrator  shall assess against that party
the  costs of the other  parties  relating  to the  arbitration,  including  the
reasonable attorneys' fees.

                                   SECTION 15
                               GENERAL PROVISIONS

         15.1 ENTIRE AGREEMENT

         This  Agreement   contains  the  entire  agreement  among  the  parties
concerning  its subject  matter and  replaces all other  agreements  among them,
whether written or oral, concerning this subject matter.

         15.2 CONFLICTS BETWEEN AGREEMENT AND CERTIFICATE

         If there is any conflict  between the  provisions of this Agreement and
those of the Certificate, then, in any dispute among the Members, the provisions
of this Agreement shall prevail.

         15.3 EFFECT OF ACT

         Except as otherwise  provided in this Agreement or by law, the business
and internal affairs of the Company shall be governed by the Act as in effect on
the Effective Date.

         15.4 CHANGES OF LAW

         If  mandatory  rules of the Act or other  applicable  law  change  in a
manner that  provides  material  advantages or  disadvantages  to any Member not
contemplated by this Agreement,  the Members shall equitably amend the Agreement
to minimize or eliminate these advantages and disadvantages.

         15.5 INCORPORATION OF SCHEDULES

         All  schesdules  identified  in  the  Agreement  as  schedules  to  the
Agreement are hereby  incorporated into the Agreement and made integral parts of
it.

         15.6 GOVERNING LAW

         This  Agreement  shall be governed by and construed in accordance  with
the  domestic  laws of the  State  of  Delaware  without  giving  effect  to any
choice-of-law  or  conflict-of-law  provision  or rule  (whether of the State of
Delaware or of any other  jurisdiction)  that would cause the application of the
laws of any jurisdiction other than the State of Delaware.

                                       36
<PAGE>

         15.7 FORUM FOR LITIGATION; ACCEPTANCE OF PERSONAL JURISDICTION

         If any party sues  another  party in a suit under or  relating  to this
Agreement, the party bringing the suit shall do so in the courts of the State of
Delaware.  The parties hereby  irrevocably  accept the personal  jurisdiction of
those courts in any such suit.

         15.8 ASSIGNMENTS AND DELEGATIONS

         Except as otherwise  provided in this Agreement,  no party shall assign
any of its rights or  delegate  any of its duties  under this  Agreement  to any
third party except with the consent of the other parties to the Agreement, which
consent these other parties shall not unreasonably withhold.

         15.9 CAPTIONS

         All captions in this  Agreement are for  convenience  only and shall be
deemed irrelevant in construing any provision of the Agreement.

         15.10 NOTICES

         Except as expressly  set forth to the contrary in this  Agreement,  all
notices,  requests, or consents provided for or permitted to be given under this
Agreement  must be in writing and must be given either by depositing the writing
in the United  States  mail,  addressed  to the  recipient,  postage  paid,  and
registered or certified  with return  receipt  requested or by  delivering  that
writing to the recipient in person,  by courier,  or by facsimile  transmission;
and a notice,  request,  or consent  given under this  Agreement is effective on
receipt by the Person to receive it. All notices,  requests,  and consents to be
sent to a Manager,  a Member or the Company must be given to the Managers at the
following address:

                     BWP Gas, LLC
                     111 Presidential Boulevard, Suite 158A
                     Bala Cynwyd, Pennsylvania 19004

Whenever  any notice is required  to be given by law,  the  Certificate  or this
Agreement,  a written waiver  thereof,  signed by the Person entitled to notice,
whether before or after the time stated therein,  shall be deemed  equivalent to
the giving of such notice.

         15.11 CERTAIN MEANINGS AND CONSTRUCTIONS

         The terms  "include" and similar terms as used in this Agreement  shall
denote  partial  definitions.  As the  context  shall  require,  the  use of the
singular in this Agreement  shall denote the plural and vice versa,  and the use
of a particular gender shall denote another gender.

         15.12 WAIVERS

         No delay of or omission by a party in the exercise of any right,  power
or remedy  accruing to the party as a result of any breach or default by another
party under this Agreement shall impair any such right, power or remedy accruing

                                       37
<PAGE>

to the party,  or shall be construed as a waiver of or acquiescence by the party
in any such  breach or default  or of any  similar  breach or default  occurring
later. No waiver by a party of any single breach or default under this Agreement
shall be  construed  as a waiver  by the party of any  other  breach or  default
occurring before or after that waiver.

         15.13 SEPARABILITY OF PROVISIONS

         Each  provision of this  Agreement  shall be deemed  separable.  If any
provision or the  application  of any  provision  to any Person or  circumstance
shall be held invalid or unenforceable in any jurisdiction,  the provision shall
be ineffective only in that jurisdiction and only to the extent that it has been
expressly  held to be invalid or  unenforceable  in that  jurisdiction,  without
invalidating  any other  provision of this  Agreement or the  application of the
provision  itself to Persons or  circumstances  other than those to which it was
held invalid or unenforceable in the jurisdiction in question.

         15.14 COUNTERPARTS

         This  Agreement  may be executed in any number of  counterparts  and by
different  parties to this  Agreement  in separate  counterparts.  Each of these
counterparts  when so executed  shall be deemed to be an  original  and all such
counterparts taken together shall constitute one and the same agreement.

         15.15 FURTHER ACTIONS BY THE PARTIES

         Each party, upon reasonable  request by another party, shall furnish to
the other party any  information  reasonably  requested by the other party,  and
sign any  documents  and do any other  things  that the other  party  reasonably
requests for the purpose of carrying out the intent of this Agreement.

         15.16 ADEQUACY OF CONSIDERATION

         Each party  acknowledges and agrees that upon the effectiveness of this
Agreement,  the party will be in receipt of valid and adequate consideration for
its undertakings under this Agreement.

         15.17 NOTICE OF PROVISIONS OF THIS AGREEMENT AND CERTIFICATE

         By  executing  this  Agreement,  each Member  acknowledges  that it has
actual notice of all of the  provisions of this  Agreement,  including,  without
limitation  (i) the  restrictions  on transfer of the  Membership  Interests set
forth in Section 3.11, and (ii) all of the provisions of the Certificate.

                  [Remainder of page intentionally left blank]

                                       38
<PAGE>

         IN WITNESS  WHREOF,  the parties hereto have executed this Agreement as
of the day and year first above written.

                                    CLASS A MEMBER:

                                    OKLAHOMA HILLS GAS, LLC

                                    By: HBA GAS, INC., its Managing Member

                                    By: /s/ ERNEST A. BARTLETT
                                       ----------------------------------
                                       Ernest A. Bartlett
                                       President

                                    CLASS B MEMBER:

                                    HBA GAS, INC.

                                    By:  /s/ ERNEST A. BARTLETT
                                       ----------------------------------
                                       Ernest A. Bartlett
                                       President

                                    CONTINENTAL SOUTHERN RESOURCES,
                                      INC., as Substituted Member for HBA Gas,
                                      Inc., effective May 27, 2003.

                                    By: /s/ STEPHEN P. HARRINGTON
                                       ----------------------------------
                                       Stephen P. Harrington
                                       President

                                       39
<PAGE>

                                   SCHEDULE A

The Membership Interests of the initial Members are as follows:

   NAME OF MEMBER                                         PERCENTAGE INTEREST

   INITIAL CLASS A MEMBER
          Oklahoma Hills Gas, LLC                                 1%
   INITIAL CLASS B MEMBER
          HBA Gas, Inc.                                           99%

Effective May 27, 2003, the Membership Interests of the Members are as follows:

   NAME OF MEMBER                                         PERCENTAGE INTEREST

   CLASS A MEMBER
          Oklahoma Hills Gas, LLC                                 1%
   CLASS B MEMBER
          Continental Southern                                    99%
              Resources, Inc.

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