Document:

Exhibit 10.2
	 

	 
		ADVISORY AGREEMENT
	 

	 
		AGREEMENT made as of the 3rd day
		of April, 2006 among CITIGROUP MANAGED FUTURES LLC, a Delaware limited
		liability company (“CMF”), Smith Barney Bristol Energy Fund L.P., a
		New York limited partnership (the “Partnership”) and SandRidge
		Capital, LP, a Texas limited partnership (“SandRidge” or the
		“Advisor”).
	 

	 
		W I T N E S S E T H :
	 

	 
		WHEREAS, CMF is the general partner of Smith
		Barney Bristol Energy Fund L.P., a limited partnership organized for the
		purpose of speculative trading of commodity interests, including futures
		contracts, options, swaps and forward contracts on U.S. and non-U.S. markets
		with the objective of achieving substantial capital appreciation, such trading
		to be conducted directly or through investment in CMF SandRidge Master Fund
		L.P., a New York limited partnership (the “Master Fund”) of which CMF
		is the general partner and SandRidge is the advisor; and
	 

	 
		WHEREAS, the Limited Partnership Agreement
		establishing the Partnership (the “Limited Partnership Agreement”)
		permits CMF to delegate to one or more commodity trading advisors CMF’s
		authority to make trading decisions for the Partnership; and
	 

	 
		WHEREAS, the Advisor is registered as a
		commodity trading advisor with the Commodity Futures Trading Commission
		(“CFTC”) and is a member of the National Futures Association
		(“NFA”); and
	 

	 
		WHEREAS, CMF is registered as a commodity
		pool operator with the CFTC and is a member of the NFA; and
	 

	 
		WHEREAS, CMF, the Partnership and SandRidge
		Capital, Inc. a Texas corporation, entered into an advisory agreement dated as
		of April 25, 2005 (the “Initial Advisory Agreement”), pursuant to
		which SandRidge Capital, Inc. agreed to render and implement advisory services
		to the Partnership; and
	 

	 
		WHEREAS, the Advisor and SandRidge Capital,
		Inc. have the same beneficial ownership; and
	 

	 
		WHEREAS, SandRidge Capital, Inc. wishes to
		transfer all of its rights and obligations under the Initial Advisory Agreement
		to the Advisor, and the Advisor wishes to assume all of such rights and
		obligations of SandRidge Capital, Inc. under the Initial Advisory Agreement;
		and 
	 

	 
		WHEREAS, CMF, the Partnership and the
		Advisor wish to enter into this Agreement in order to set forth the terms and
		conditions upon which the Advisor will (i) render and implement advisory
		services in connection with the conduct by the Partnership of its commodity
		trading activities during the term of this Agreement and (ii) assume the rights
		and obligations of SandRidge Capital, Inc. under the Initial Advisory
		Agreement;
	 

	 
		 
	 

	 
	 

	 

	 
		NOW, THEREFORE, the parties agree as
		follows:
	 

	 
		1. DUTIES OF THE ADVISOR. (a) For the period and on the terms and conditions of
		this Agreement, the Advisor shall have sole authority and responsibility, as
		one of the Partnership’s agents and attorneys-in-fact, for directing the
		investment and reinvestment of the assets and funds of the Partnership
		allocated to it from time to time by the General Partner in commodity
		interests, including commodity futures contracts, options and forward
		contracts. The Advisor may also engage in swaps transactions and other
		derivative transactions on behalf of the Partnership with the prior approval of
		CMF. All such trading on behalf of the Partnership shall be in accordance with
		the trading strategies and trading policies set forth in the Private Placement
		Offering Memorandum and Disclosure Document to be dated on or about May 31,
		2005 (the “Memorandum”), and as such trading policies may be changed
		from time to time upon receipt by the Advisor of prior written notice of such
		change and pursuant to the trading strategy selected by CMF to be utilized by
		the Advisor in managing the Partnership’s assets. CMF has initially
		selected the Advisor’s Energy Program (the “Program”) to manage
		the Partnership’s assets allocated to it. Any open positions or other
		investments at the time of receipt of such notice of a change in trading policy
		shall not be deemed to violate the changed policy and shall be closed or sold
		in the ordinary course of trading. The Advisor may not deviate from the trading
		policies set forth in the Memorandum without the prior written consent of the
		Partnership given by CMF. The Advisor makes no representation or warranty that
		the trading to be directed by it for the Partnership will be profitable or will
		not incur losses.
	 

	 
		(b) CMF acknowledges receipt of
		SandRidge’s Disclosure Document dated February 19, 2006, as filed with the
		NFA. All trades made by the Advisor for the account of the Partnership shall be
		made through such commodity broker or brokers as CMF shall direct, and the
		Advisor shall have no authority or responsibility for selecting or supervising
		any such broker in connection with the execution, clearance or confirmation of
		transactions for the Partnership or for the negotiation of brokerage rates
		charged therefor. However, the Advisor, with the prior written permission (by
		either original or fax copy) of CMF, may direct any and all trades in commodity
		futures and options to a futures commission merchant or independent floor
		broker it chooses for execution with instructions to give-up the trades to the
		broker designated by CMF, provided that the futures commission merchant or
		independent floor broker and any give-up or floor brokerage fees are approved
		in advance by CMF. All give-up or similar fees relating to the foregoing shall
		be paid by the Partnership after all parties have executed the relevant give-up
		agreements (by either original or fax copy).
	 

	 
		(c) The initial allocation of the
		Partnership’s assets to the Advisor will be made to the Program. In the
		event the Advisor wishes to use a trading system or methodology other than or
		in addition to the system or methodology outlined in the Memorandum in
		connection with its trading for the Partnership, either in whole or in part, it
		may not do so unless the Advisor gives CMF prior written notice of its
		intention to utilize such different trading system or methodology and CMF
		consents thereto in writing. In addition, the Advisor will provide five
		days’ prior written notice to CMF of any change in the trading system or
		methodology to be utilized for the Partnership which the Advisor deems
		material. If the Advisor deems such change in system or methodology or in
		markets traded to be material, the changed system or methodology or markets
		traded will not be utilized for the Partnership without the prior written
		consent of CMF. In addition, the Advisor will notify CMF of any changes to
		the
	 

	 
		 
	 

	 
		 
	 

	 
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		trading system or methodology that would
		require a change in the description of the trading strategy or methods
		described in the Memorandum. Further, the Advisor will provide the Partnership
		with a current list of all commodity interests to be traded for the
		Partnership’s account and will not trade any additional commodity
		interests for such account without providing notice thereof to CMF and
		receiving CMF’s written approval. The Advisor also agrees to provide CMF,
		on a monthly basis, with a written report of the assets under the
		Advisor’s management together with all other matters deemed by the Advisor
		to be material changes to its business not previously reported to CMF. 
	 

	 
		(d) The Advisor agrees to make all material
		disclosures to the Partnership regarding itself and its principals as defined
		in Part 4 of the CFTC’s regulations (“principals”), partners,
		shareholders, directors, officers and employees, their trading performance and
		general trading methods, its customer accounts (but not the identities of or
		identifying information with respect to its customers) and otherwise as are
		required in the reasonable judgment of CMF to be made in any filings required
		by Federal or state law or NFA rule or order. Notwithstanding Paragraphs 1(d)
		and 4(d) of this Agreement, the Advisor is not required to disclose the actual
		trading results of proprietary accounts of the Advisor or its principals unless
		CMF reasonably determines that such disclosure is required in order to fulfill
		its fiduciary obligations to the Partnership or the reporting, filing or other
		obligations imposed on it by Federal or state law or NFA rule or order. The
		Partnership and CMF acknowledge that the trading advice to be provided by the
		Advisor is a property right belonging to the Advisor and that they will keep
		all such advice confidential. Further, CMF agrees to treat as confidential any
		results of proprietary accounts and/or proprietary information with respect to
		trading systems obtained from the Advisor.
	 

	 
		(e) The Advisor understands and agrees that
		CMF may designate other trading advisors for the Partnership and apportion or
		reapportion to such other trading advisors the management of an amount of Net
		Assets (as such term is defined in Paragraph 3(b) hereof) as it shall determine
		in its absolute discretion. The designation of other trading advisors and the
		apportionment or reapportionment of Net Assets to any such trading advisors
		pursuant to this Paragraph 1 shall neither terminate this Agreement nor modify
		in any regard the respective rights and obligations of the parties
		hereunder.
	 

	 
		(f) CMF may, from time to time, in its
		absolute discretion, select additional trading advisors and reapportion funds
		among the trading advisors for the Partnership as it deems appropriate. CMF
		shall use its best efforts to make reapportionments, if any, as of the first
		day of a month. The Advisor agrees that it may be called upon at any time
		promptly to liquidate positions in CMF’s sole discretion so that CMF may
		reallocate the Partnership’s assets, meet margin calls on the
		Partnership’s account, fund redemptions, or for any other reason, except
		that CMF will not require the liquidation of specific positions by the Advisor.
		CMF will use its best efforts to give two days’ prior notice to the
		Advisor of any reallocations or liquidations.
	 

	 
		(g) The Advisor will not be liable for
		trading losses in the Partnership’s account including losses caused by
		errors; provided, however, that (i) the Advisor will be liable to the
		Partnership with respect to losses incurred due to errors committed or caused
		by it or any of its principals or employees in communicating improper trading
		instructions or orders to any broker on behalf of the Partnership and (ii) the
		Advisor will be liable to the Partnership with 
	 

	 
		 
	 

	 
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		respect to losses incurred due to errors
		committed or caused by any executing broker (other than any CMF affiliate)
		selected by the Advisor, (it also being understood that CMF, with the
		assistance of the Advisor, will first attempt to recover such losses from the
		executing broker).
	 

	 
		2. INDEPENDENCE OF THE ADVISOR. For all purposes herein, the Advisor shall be deemed
		to be an independent contractor and, unless otherwise expressly provided or
		authorized, shall have no authority to act for or represent the Partnership in
		any way and shall not be deemed an agent, promoter or sponsor of the
		Partnership, CMF, or any other trading advisor. The Advisor shall not be
		responsible to the Partnership, the General Partner, any trading advisor or any
		limited partners for any acts or omissions of any other trading advisor to the
		Partnership.
	 

	 
		3. COMPENSATION.
		(a) In consideration of and as compensation for all of the services to be
		rendered by the Advisor to the Partnership under this Agreement, the
		Partnership shall (i) pay the Advisor a monthly fee for professional advisory
		services equal to 1/6 of 1% (2% per year) of the month-end Net Assets of the
		Partnership allocated to the Advisor; and (ii) allocate to the Advisor a
		quarterly profit share allocation (a “Profit Share”) to its capital
		account in the Partnership equal to 20% of New Trading Profits (as such term is
		defined in the Limited Partnership Agreement) earned by the Advisor for the
		Partnership during each calendar quarter in the form of Units of Limited
		Partnership Interest (as such term is defined in the Limited Partnership
		Agreement).
	 

	 
		(b) “Net Assets” shall have the
		meaning set forth in Section 7(d)(1) of the Limited Partnership Agreement dated
		as of April 20, 2005 and without regard to further amendments thereto, provided
		that in determining the Net Assets of the Partnership on any date, no
		adjustment shall be made to reflect any distributions, redemptions or Profit
		Shares allocable as of the date of such determination.
	 

	 
		(c) Monthly advisory fees shall be paid
		within twenty (20) business days following the end of the period for which such
		fee is payable. In the event of the termination of this Agreement as of any
		date which shall not be the end of a calendar month the monthly advisory fee
		shall be prorated to the effective date of termination. If, during any month,
		the Partnership does not conduct business operations or the Advisor is unable
		to provide the services contemplated herein for more than two successive
		business days, the monthly advisory fee shall be prorated by the ratio which
		the number of business days during which CMF conducted the Partnership’s
		business operations or utilized the Advisor’s services bears in the month
		to the total number of business days in such month.
	 

	 
		(d) The provisions of this Paragraph 3 shall
		survive the termination of this Agreement.
	 

	 
		4. RIGHT TO ENGAGE IN OTHER ACTIVITIES. (a) The services provided by the Advisor hereunder are
		not to be deemed exclusive. CMF on its own behalf and on behalf of the
		Partnership acknowledges that, subject to the terms of this Agreement, the
		Advisor and its officers, directors, employees and shareholder(s), may render
		advisory, consulting and management services to other clients and accounts. The
		Advisor and its officers, directors, employees and shareholder(s) shall be free
		to trade for their own accounts and to 
	 

	 
		 
	 

	 
		 
	 

	 
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		advise other investors and manage other
		commodity accounts during the term of this Agreement and to use the same
		information, computer programs and trading strategies, programs or formulas
		which they obtain, produce or utilize in the performance of services to CMF for
		the Partnership. However, the Advisor represents, warrants and agrees that it
		believes the rendering of such consulting, advisory and management services to
		other accounts and entities will not require any material change in the
		Advisor’s basic trading strategies and will not affect the capacity of the
		Advisor to continue to render services to CMF for the Partnership of the
		quality and nature contemplated by this Agreement.
	 

	 
		(b) If, at any time during the term of this
		Agreement, the Advisor is required to aggregate the Partnership’s
		commodity positions with the positions of any other person for purposes of
		applying CFTC- or exchange-imposed speculative position limits, the Advisor
		agrees that it will promptly notify CMF in writing if the Partnership’s
		positions are included in an aggregate amount which exceeds the applicable
		speculative position limit. The Advisor agrees that, if its trading
		recommendations are altered because of the application of any speculative
		position limits, it will not modify the trading instructions with respect to
		the Partnership’s account in such manner as to affect the Partnership
		substantially disproportionately as compared with the Advisor’s other
		accounts. The Advisor further represents, warrants and agrees that under no
		circumstances will it knowingly or deliberately use trading strategies or
		methods for the Partnership that are inferior to strategies or methods employed
		for any other client or account and that it will not knowingly or deliberately
		favor any client or account managed by it over any other client or account in
		any manner, it being acknowledged, however, that different trading strategies
		or methods may be utilized for differing sizes of accounts, accounts with
		different trading policies, accounts experiencing differing inflows or outflows
		of equity, accounts which commence trading at different times, accounts which
		have different portfolios or different fiscal years, accounts utilizing
		different executing brokers and accounts with other differences, and that such
		differences may cause divergent trading results.
	 

	 
		(c) It is acknowledged that the Advisor
		and/or its officers, employees, directors and shareholder(s) presently act, and
		it is agreed that they may continue to act, as advisor for other accounts
		managed by them, and may continue to receive compensation with respect to
		services for such accounts in amounts which may be more or less than the
		amounts received from the Partnership.
	 

	 
		(d) The Advisor agrees that it shall make
		such information available to CMF respecting the performance of the
		Partnership’s account as compared to the performance of other accounts
		managed by the Advisor or its principals as shall be reasonably requested by
		CMF. The Advisor presently believes and represents that existing speculative
		position limits will not materially adversely affect its ability to manage the
		Partnership’s account given the potential size of the Partnership’s
		account and the Advisor’s and its principals’ current accounts and
		all proposed accounts for which they have contracted to act as trading
		advisor.
	 

	 
		5. TERM. (a) This
		Agreement shall continue in effect until June 30, 2006. CMF may, in its sole
		discretion, renew this Agreement for additional one-year periods upon notice to
		the Advisor not less than 30 days prior to the expiration of the previous
		period. At any time during the term of this Agreement, CMF may terminate this
		Agreement at any month-end upon 30 days’ notice to the Advisor. At any
		time during the term of this Agreement, CMF may 
	 

	 
		 
	 

	 
		 
	 

	 
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		elect to immediately terminate this
		Agreement upon 30 days’ notice to the Advisor if (i) the Net Asset Value
		per Unit of Limited Partnership Interest shall decline as of the close of
		business on any day to $400 or less; (ii) the Net Assets allocated to the
		Advisor (adjusted for redemptions, distributions, withdrawals or reallocations,
		if any) decline by 50% or more as of the end of a trading day from such Net
		Assets’ previous highest value; (iii) limited partners owning at least 50%
		of the outstanding Units of Limited Partnership Interest shall vote to require
		CMF to terminate this Agreement; (iv) the Advisor fails to comply with the
		terms of this Agreement; (v) CMF, in good faith, reasonably determines that the
		performance of the Advisor has been such that CMF’s fiduciary duties to
		the Partnership require CMF to terminate this Agreement; or (vi) CMF reasonably
		believes that the application of speculative position limits will substantially
		affect the performance of the Partnership. At any time during the term of this
		Agreement, CMF may elect immediately to terminate this Agreement if (i) the
		Advisor merges or consolidates with another entity, sells a substantial portion
		of its assets, or becomes bankrupt or insolvent, (ii) Andrew M. Rowe dies,
		becomes incapacitated, leaves the employ of the Advisor, ceases to control the
		Advisor or is otherwise not managing the trading programs or systems of the
		Advisor, or (iii) the Advisor’s registration as a commodity trading
		advisor with the CFTC or its membership in the NFA or any other regulatory
		authority, is terminated or suspended. This Agreement will immediately
		terminate upon dissolution of the Partnership or upon cessation of trading
		prior to dissolution.
	 

	 
		(b) The Advisor may terminate this Agreement
		by giving not less than 30 days’ notice to CMF (i) in the event that the
		trading policies of the Partnership as set forth in the Memorandum are changed
		in such manner that the Advisor reasonably believes will adversely affect the
		performance of its trading strategies; (ii) after June 30, 2006; or (iii) in
		the event that the General Partner or Partnership fails to comply with the
		terms of this Agreement. The Advisor may immediately terminate this Agreement
		if CMF’s registration as a commodity pool operator or its membership in
		the NFA is terminated or suspended.
	 

	 
		(c) Except as otherwise provided in this
		Agreement, any termination of this Agreement in accordance with this Paragraph
		5 or Paragraph 1(e) shall be without penalty or liability to any party, except
		for any fees due to the Advisor pursuant to Paragraph 3 hereof.
	 

	 
		6. INDEMNIFICATION.
		(a)(i) In any threatened, pending or completed action, suit, or proceeding to
		which the Advisor was or is a party or is threatened to be made a party arising
		out of or in connection with this Agreement or the management of the
		Partnership’s assets by the Advisor or the offering and sale of units in
		the Partnership, CMF shall, subject to subparagraph (a)(iii) of this Paragraph
		6, indemnify and hold harmless the Advisor against any loss, liability, damage,
		cost, expense (including, without limitation, attorneys’ and
		accountants’ fees), judgments and amounts paid in settlement actually and
		reasonably incurred by it in connection with such action, suit, or proceeding
		if the Advisor acted in good faith and in a manner reasonably believed to be in
		or not opposed to the best interests of the Partnership, and provided that its
		conduct did not constitute negligence, intentional misconduct, or a breach of
		its fiduciary obligations to the Partnership as a commodity trading advisor,
		unless and only to the extent that the court or administrative forum in which
		such action or suit was brought shall determine upon application that, despite
		the adjudication of liability but in view of all circumstances of the case, the
		Advisor is fairly and reasonably entitled to indemnity for such expenses which
		such court or administrative forum shall deem proper; and further provided that
		
	 

	 
		 
	 

	 
		 
	 

	 
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		no indemnification shall be available from
		the Partnership if such indemnification is prohibited by Section 16 of the
		Limited Partnership Agreement. The termination of any action, suit or
		proceeding by judgment, order or settlement shall not, of itself, create a
		presumption that the Advisor did not act in good faith and in a manner
		reasonably believed to be in or not opposed to the best interests of the
		Partnership.To the extent that the Advisor has been successful on the merits or
		otherwise in defense of any action, suit or proceeding referred to in
		subparagraph (i) above, or in defense of any claim, issue or matter therein,
		CMF shall indemnify the Advisor against the expenses (including, without
		limitation, attorneys’ and accountants’ fees) actually and reasonably
		incurred by it in connection therewith.
	 

	 
		(iii) Any indemnification under subparagraph
		(i) above, unless ordered by a court or administrative forum, shall be made by
		CMF only as authorized in the specific case and only upon a determination by
		independent legal counsel in a written opinion that such indemnification is
		proper in the circumstances because the Advisor has met the applicable standard
		of conduct set forth in subparagraph (i) above. Such independent legal counsel
		shall be selected by CMF in a timely manner, subject to the Advisor’s
		approval, which approval shall not be unreasonably withheld. The Advisor will
		be deemed to have approved CMF’s selection unless the Advisor notifies CMF
		in writing, received by CMF within five days of CMF’s telecopying to the
		Advisor of the notice of CMF’s selection, that the Advisor does not
		approve the selection.
	 

	 
		(iv) In the event the Advisor is made a
		party to any claim, dispute or litigation or otherwise incurs any loss or
		expense as a result of, or in connection with, the Partnership’s or
		CMF’s activities or claimed activities unrelated to the Advisor, CMF shall
		indemnify, defend and hold harmless the Advisor against any loss, liability,
		damage, cost or expense (including, without limitation, attorneys’ and
		accountants’ fees) incurred in connection therewith.
	 

	 
		(v) As used in this Paragraph 6(a), the term
		“Advisor” shall include the Advisor, its principals, officers,
		directors, stockholders and employees and the term “CMF” shall
		include the Partnership.
	 

	 
		(d) (i) The Advisor agrees to indemnify,
		defend and hold harmless CMF, the Partnership and their affiliates against any
		loss, liability, damage, cost or expense (including, without limitation,
		attorneys’ and accountants’ fees), judgments and amounts paid in
		settlement actually and reasonably incurred by them (A) as a result of the
		material breach of any material representations and warranties made by the
		Advisor in this Agreement, or (B) as a result of the material breach of any
		material representation, warranty or covenant made by SandRidge Capital, Inc.
		under the Initial Advisory Agreement, or (C) as a result of any act or omission
		of the Advisor or SandRidge Capital, Inc. relating to the Partnership if there
		has been a final judicial or regulatory determination or, in the event of a
		settlement of any action or proceeding with the prior written consent of the
		Advisor or SandRidge Capital, Inc., a written opinion of an arbitrator pursuant
		to Paragraph 14 hereof, to the effect that such acts or omissions violated the
		terms of this Agreement in any material respect or involved negligence, bad
		faith, recklessness or intentional misconduct on the part of the Advisor or
		SandRidge Capital, Inc. (except as otherwise provided in Paragraph
		1(g)).
	 

	 
		 
	 

	 
		 
	 

	 
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		(ii) In the event CMF or the Partnership is
		made a party to any claim, dispute or litigation or otherwise incurs any loss
		or expense as a result of, or in connection with, the activities or claimed
		activities of the Advisor, SandRidge Capital, Inc. or their principals,
		officers, directors, shareholder(s) or employees unrelated to CMF’s or the
		Partnership’s business, the Advisor shall indemnify, defend and hold
		harmless CMF, the Partnership or any of their affiliates against any loss,
		liability, damage, cost or expense (including, without limitation,
		attorneys’ and accountants’ fees) incurred in connection
		therewith.
	 

	 
		(e) In the event that a person entitled to
		indemnification under this Paragraph 6 is made a party to an action, suit or
		proceeding alleging both matters for which indemnification can be made
		hereunder and matters for which indemnification may not be made hereunder, such
		person shall be indemnified only for that portion of the loss, liability,
		damage, cost or expense incurred in such action, suit or proceeding which
		relates to the matters for which indemnification can be made.
	 

	 
		(f) None of the indemnifications contained
		in this Paragraph 6 shall be applicable with respect to default judgments,
		confessions of judgment or settlements entered into by the party claiming
		indemnification without the prior written consent, which shall not be
		unreasonably withheld, of the party obligated to indemnify such party.
	 

	 
		(g) The provisions of this Paragraph 6 shall
		survive the termination of this Agreement.
	 

	 
		6. REPRESENTATIONS, WARRANTIES AND
		AGREEMENTS.
	 

	 
		(a) The Advisor represents and warrants
		that:
	 

	 
		(i) All references to the Advisor and its
		principals in the Memorandum are accurate in all material respects and as to
		them the Memorandum does not contain any untrue statement of a material fact or
		omit to state a material fact which is necessary to make the statements therein
		not misleading, except that with respect to Table B and other pro forma or
		hypothetical performance information in the in the Memorandum, if any, this
		representation and warranty extends only to the underlying data made available
		by the Advisor for the preparation thereof and not to any hypothetical or pro
		forma adjustments. Subject to such exception, all references to the Advisor and
		its principals in the Memorandum will, after review and approval of such
		references by the Advisor prior to the use of such Memorandum in connection
		with the offering of the Partnership’s units, be accurate in all material
		respects.
	 

	 
		(ii) The information with respect to the
		Advisor set forth in the actual performance tables in the Memorandum is based
		on all of the customer accounts managed on a discretionary basis by the
		Advisor’s principals and/or the Advisor during the period covered by such
		tables and required to be disclosed therein. The Advisor’s performance
		tables have been examined by an independent certified public accountant and the
		report thereon has been provided to CMF. The Advisor will have its performance
		tables so examined no less frequently than annually during the term of this
		Agreement.
	 

	 
		(iii) The Advisor will be acting as a
		commodity trading advisor with respect to the Partnership and not as a
		securities investment adviser and is duly registered with 
	 

	 
		 
	 

	 
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		the CFTC as a commodity trading advisor, is
		a member of the NFA, and is in compliance with such other registration and
		licensing requirements as shall be necessary to enable it to perform its
		obligations hereunder, and agrees to maintain and renew such registrations and
		licenses during the term of this Agreement.
	 

	 
		(iv) The Advisor is a limited partnership
		duly organized, validly existing and in good standing under the laws of the
		State of Texas and has full limited partnership power and authority to enter
		into this Agreement and to provide the services required of it
		hereunder.
	 

	 
		(v) The Advisor will not, by acting as a
		commodity trading advisor to the Partnership, breach or cause to be breached
		any undertaking, agreement, contract, statute, rule or regulation to which it
		is a party or by which it is bound.
	 

	 
		(vi) This Agreement has been duly and
		validly authorized, executed and delivered by the Advisor and is a valid and
		binding agreement enforceable in accordance with its terms.
	 

	 
		(vii) At any time during the term of this
		Agreement that a prospectus relating to the units is required to be delivered
		in connection with the offer and sale thereof, the Advisor agrees upon the
		request of CMF to provide the Partnership with such information as shall be
		necessary so that, as to the Advisor and its principals, such prospectus is
		accurate.
	 

	 
		(viii) In the event that the Advisor forms
		another commodity pool unrelated to CMF with substantially similar investors,
		whether or not the Advisor terminates this Agreement or continues trading for
		the Partnership, the Advisor shall pay to CMF all expenses incurred by CMF,
		Citigroup Global Markets Inc. (“CGM”) and the Partnership in
		connection with the organization and offering of the Partnership, including but
		not limited to attorneys’, accountants’ and filing fees, to the
		extent that CMF and CGM have not previously been reimbursed by the
		Partnership.
	 

	 
		(ix) The Advisor agrees that it shall be
		responsible for any liability of SandRidge Capital, Inc. that arises under the
		Initial Advisory Agreement.
	 

	 
		(x) The Advisor will make no
		representations, other than those contained in the Memorandum, to investors or
		prospective investors in the Partnership with respect to the offering and sale
		of Units in the Partnership without the prior written approval of CMF.
	 

	 
		(b) CMF represents and warrants for itself
		and the Partnership that:
	 

	 
		(i) The Memorandum (as from time to time
		amended or supplemented, which amendment or supplement is approved by the
		Advisor as to descriptions of itself and its actual performance) does not
		contain any untrue statement of a material fact or omit to state a material
		fact which is necessary to make the statements therein not misleading, except
		that the foregoing representation does not apply to any statement or omission
		concerning the Advisor in the Memorandum, made in reliance upon, and in
		conformity with, information furnished to CMF by or on behalf of the Advisor
		expressly for use in the Memorandum (it being
	 

	 
		 
	 

	 
		 
	 

	 
		-9-
	 

	 
		 
	 

	 
	 

	 

	 
		understood that the hypothetical and pro
		forma adjustments in Table B were not furnished by the Advisor).
	 

	 
		(ii) It is a limited liability company duly
		organized, validly existing and in good standing under the laws of the State of
		Delaware and has full limited liability company power and authority to perform
		its obligations under this Agreement.
	 

	 
		(iii) CMF and the Partnership have the
		capacity and authority to enter into this Agreement on behalf of the
		Partnership.
	 

	 
		(iv) This Agreement has been duly and
		validly authorized, executed and delivered on CMF’s and the
		Partnership’s behalf and is a valid and binding agreement of CMF and the
		Partnership enforceable in accordance with its terms.
	 

	 
		(v) CMF will not, by acting as General
		Partner to the Partnership and the Partnership will not, breach or cause to be
		breached any undertaking, agreement, contract, statute, rule or regulation to
		which it is a party or by which it is bound which would materially limit or
		affect the performance of its duties under this Agreement.
	 

	 
		(vi) It is registered as a commodity pool
		operator and is a member of the NFA, and it will maintain and renew such
		registration and membership during the term of this Agreement. 
	 

	 
		(vii) The Partnership is a limited
		partnership duly organized and validly existing under the laws of the State of
		New York and has full power and authority to enter into this Agreement and to
		perform its obligations under this Agreement.
	 

	 
		7. COVENANTS OF THE ADVISOR, CMF AND THE
		PARTNERSHIP. (a) The Advisor agrees as
		follows:
	 

	 
		(i) In connection with its activities on
		behalf of the Partnership, the Advisor will comply with all applicable laws,
		including rules and regulations of the CFTC, NFA and/or the commodity exchange
		on which any particular transaction is executed.
	 

	 
		(ii) The Advisor will promptly notify CMF of
		the commencement of any material suit, action or proceeding involving it,
		whether or not any such suit, action or proceeding also involves CMF. The
		Advisor will provide CMF with copies of any correspondence from or to the CFTC,
		NFA or any commodity exchange in connection with an investigation or audit of
		the Advisor’s business activities.
	 

	 
		(iii) In the placement of orders for the
		Partnership’s account and for the accounts of any other client, the
		Advisor will utilize a pre-determined, systematic, fair and reasonable order
		entry system, which shall, on an overall basis, be no less favorable to the
		Partnership than to any other account managed by the Advisor. The Advisor
		acknowledges its obligation to review the Partnership’s positions, prices
		and equity in the account managed by the Advisor daily and within two business
		days to notify, in writing, the broker and CMF and the Partnership’s
		brokers of (i) any error committed by the Advisor or its principals or
		employees; (ii) any trade which the Advisor believes was not executed in
		accordance with its instructions;
	 

	 
		 
	 

	 
		 
	 

	 
		-10-
	 

	 
		 
	 

	 
	 

	 

	 
		and (iii) any discrepancy with a value of
		$10,000 or more (due to differences in the positions, prices or equity in the
		account) between its records and the information reported on the account’s
		daily and monthly broker statements.
	 

	 
		(iv) The Advisor will maintain a net worth
		of not less than $1,000,000 during the term of this Agreement.
	 

	 
		(b) CMF agrees for itself and the
		Partnership that:
	 

	 
		(i) CMF and the Partnership will comply with
		all applicable laws, including rules and regulations of the CFTC, NFA and/or
		the commodity exchange on which any particular transaction is executed.
	 

	 
		(ii) CMF will promptly notify the Advisor of
		the commencement of any material suit, action or proceeding involving it or the
		Partnership, whether or not such suit, action or proceeding also involves the
		Advisor.
	 

	 
		(iii) CMF will be responsible for compliance
		with the USA Patriot Act and related anti-money-laundering regulations with
		respect to the Partnership and its limited partners.
	 

	 
		8. COMPLETE AGREEMENT. This Agreement constitutes the entire agreement
		between the parties pertaining to the subject matter hereof.
	 

	 
		9. ASSIGNMENT. This
		Agreement may not be assigned by any party without the express written consent
		of the other parties.
	 

	 
		10. AMENDMENT. This
		Agreement may not be amended except by the written consent of the
		parties.
	 

	 
		11. NOTICES. All
		notices, demands or requests required to be made or delivered under this
		Agreement shall be in writing and delivered personally or by registered or
		certified mail or expedited courier, return receipt requested, postage prepaid,
		to the addresses below or to such other addresses as may be designated by the
		party entitled to receive the same by notice similarly given:
	 

	 
		If to CMF:
	 

	 
		Citigroup Managed Futures LLC
	 

	 
		399 Park Avenue, 7th Floor
		
	 

	 
		New York, New York 10022
	 

	 
		Attention: Mr. David J. Vogel
	 

	 
		 
	 

	 
		 
	 

	 
		-11-
	 

	 
		 
	 

	 
	 

	 

	 
		If to the Advisor:
	 

	 
		SandRidge Capital, LP
	 

	 
		1300 Post Oak Blvd.
	 

	 
		Suite 325
	 

	 
		Houston, TX 77056
	 

	 
		Attention: Mr. Andrew M. Rowe
	 

	 
		with a copy to:
	 

	 
		David R. Allen 
	 

	 
		407 East Main Street 
	 

	 
		Murfreesboro, TN 37130 
	 

	 
		12. GOVERNING LAW.
		This Agreement shall be governed by and construed in accordance with the laws
		of the State of New York.
	 

	 
		13. ARBITRATION. The
		parties agree that any dispute or controversy arising out of or relating to
		this Agreement or the interpretation thereof, shall be settled by arbitration
		in accordance with the rules, then in effect, of the National Futures
		Association or, if the National Futures Association shall refuse jurisdiction,
		then in accordance with the rules, then in effect, of the American Arbitration
		Association; provided, however, that
		the power of the arbitrator shall be limited to interpreting this Agreement as
		written and the arbitrator shall state in writing his reasons for his award.
		Judgment upon any award made by the arbitrator may be entered in any court of
		competent jurisdiction.
	 

	 
		14. NO THIRD PARTY BENEFICIARIES. There are no third party beneficiaries to this
		Agreement.
	 

	 
		 
	 

	 
		 
	 

	 
		-12-
	 

	 
		 
	 

	 
	 

	 

	 
		IN WITNESS WHEREOF, this Agreement has been
		executed for and on behalf of the undersigned as of the day and year first
		above written.
	 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  CITIGROUP MANAGED FUTURES LLC

				

			 
	
				
				

			 	
				
				   
				

			 	
				
				  By 
				

			 	
				
				  
 /s/ Jennifer Magro
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Jennifer Magro

				  Vice President and Director
				

			 

 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  SMITH BARNEY BRISTOL ENERGY FUND L.
				  P.
				

			 
	 	 	 	 
	
				
				

			 	
				
				   
				

			 	
				
				  By:  
				

			 	
				
				  Citigroup Managed Futures
				  LLC
 (General Partner)
				

			 

 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				

			 	
				
				   
				

			 	
				
				  By 
				

			 	
				
				  
 /s/ Jennifer Magro
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Jennifer Magro

				  Vice President and Director
				

			 

 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  SANDRIDGE CAPITAL, LP
				

			 
	 	 	 	 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  By: 
				

			 	
				
				  SandRidge Capital Management GP,
				  LLC
 (General Partner)
				

			 

 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				

			 	
				
				   
				

			 	
				
				  By 
				

			 	
				
				  
 /s/ Andrew M. Rowe
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Andrew M. Rowe

				  Managing Member
				

			 

 

	 
		 
	 

	 
			
				
				  Acknowledged and agreed to
				  by:
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				  SANDRIDGE CAPITAL, INC.
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				  By 
				

			 	
				
				  
 /s/ Andrew M. Rowe
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				

			 
	
				
				   
				

			 	
				
				  Andrew M. Rowe

				  PresidentExhibit 10.2
	 

	 
		Citigroup Managed Futures
 Account Agreement and Forms
	 

	 
		Citigroup Global Markets Inc.
	 

	 
		
	 

	 
		
 

	 

	 
		

	 

	 
		

	 

	  

	 

	 
		

	 

	 
		

	 

	 
		Part I
	 

	 
		Futures Account Agreement
	 

	 
		This Futures Account Agreement (“Agreement”) between Citigroup
		Global Markets Inc. (“CGM”) and the customer named below
		(“Customer”), shall govern Customer’s futures account (the
		“Account”) with CGM relating to the purchase and sale of futures
		contracts (“Futures Contracts”), options on futures contracts and
		commodities (“Options Contracts”), and, if applicable, over the
		counter purchases and sales of coins, bullion, and metals, energy, and foreign
		currencies (all collectively, including Futures Contracts and Options
		Contracts, “Contracts”).
	 

	 
		1.  Customer Representations.  Customer represents that:
		 (a) it may lawfully and is duly authorized and empowered to enter into
		this Agreement and to effect purchases and sales of Contracts; (b) its trading
		in Contracts hereunder violates no statute, rule, regulation, decree, or
		internal policy to which Customer is subject or bound or any of Customer’s
		charter documents; (c) this Agreement is binding on Customer and enforceable
		against Customer in accordance with its terms; (d) all necessary approvals and
		consents have been obtained; (e) Customer is in compliance with any applicable
		registration requirements of the Commodity Exchange Act, as amended
		(“CEA”) and rules of the National Futures Association
		(“NFA”); and (f) except as disclosed in writing by Customer or
		provided for in this Agreement, no one has an ownership interest in or control
		over the Account other than Customer.  The representations in this
		Agreement shall be continuing representations during the term of the Agreement.

	 

	 
		2.  CGM Representations.  CGM represents that:  (a)
		this Agreement is binding on CGM and enforceable against CGM in accordance with
		its terms; (b) it is, and it or its successors shall remain during the term of
		this Agreement, duly registered as a Futures Commission Merchant; (c) CGM will
		accept and hold all margin deposited with CGM by Customer subject to the terms
		of this Agreement; (d) in accepting and holding margin on behalf of Customer,
		CGM will comply with the segregation requirements of the CEA and rules
		thereunder to the extent applicable; and (e) if Customer is an Investment
		Company registered under the Investment Company Act of 1940, CGM shall (i)
		promptly notify Customer of credit balances in the Account payable to Customer
		and, if such credit balance is free of obligation, pay such credit balance to
		Customer no later than the next business day following the day funds are
		received by CGM other than de minimus amounts Customer and CGM agree need not
		be paid, and (ii) promptly furnish to the Securities and Exchange Commission
		(“SEC”) copies or extracts of CGM’s records pertaining to
		Customer’s assets as the SEC may lawfully request.  The
		representations in this Agreement shall be continuing representations during
		the term of the Agreement.
	 

	 
	 

	 
		3.  Role of the Parties; Applicable Law.  The parties
		agree that:
	 

	 
		(a)  CGM is acting hereunder solely as a broker for Customer (except
		when Customer engages in certain over the counter transactions in coins,
		bullion, metals, and spot and forward foreign currency or engages in a block
		trade with CGM as principal), CGM is not acting as a fiduciary to Customer, and
		CGM has no discretionary authority or control over the Account.  Neither
		CGM nor any affiliate of CGM guarantees the performance of any contract market,
		clearinghouse or other third party under any Contract;
	 

	 
		(b)  CGM is authorized, in its discretion, to employ clearing
		members (including, without limitation, on exchanges of which CGM is not a
		member), floor brokers and other agents in connection with the execution,
		carrying, clearance, delivery and settlement of any purchase or sale of
		Contracts;
	 

	 
		(c)  Customer must specify at the time an order is placed the
		exchange and/or market upon which CGM will execute an order for the Account.
		 Customer acknowledges that CGM or its affiliates may have an ownership
		interest in any exchange or clearinghouse;
	 

	 
		(d)  All transactions on behalf of Customer shall be subject to the
		constitution, bylaws, rules, regulations, customs, usages, rulings and
		interpretations of the relevant exchange, clearinghouse, and any relevant
		self-regulatory organization, and all applicable governmental laws and
		regulations as amended from time to time (“Applicable Law”); Customer
		shall comply with Applicable Law and with such additional procedures as CGM may
		reasonably and lawfully establish, including those that relate to limits on the
		size of Customer’s positions, exercise of options, allocations of exercise
		notices, and the manner of delivery under any Contract.  Without limiting
		the foregoing, CGM may in its sole discretion limit the size of positions in
		the Account, decline to accept any order or transaction, and require that the
		Account be transferred to another firm;
	 

	 
		
 

	 

	 
		Page 2 of 16
	 

	 
		

	 

	  

	 

	 
		

	 

	 
		

	 

	 
		(e)  Customer shall provide to CGM such financial information
		regarding Customer as CGM may from time to time reasonably request.
		 Customer shall further provide to CGM such information, documentation, or
		both regarding Customer’s identity as CGM may reasonably request.
		 Customer understands and agrees that CGM will verify Customer’s
		identity and may, if necessary, request verification of Customer’s
		identity from third parties as required by Applicable Law, including but not
		limited to the USA Patriot Act.
	 

	 
		4.  Additional Customer Obligations.
	 

	 
		(a)  As soon as practicable following the conclusion of the Initial
		Offering Period (as defined in the Private Placement Offering Memorandum and
		Disclosure Document of the Customer), the Customer shall deposit or cause to be
		deposited the capital contributions in the Account.  The Customer will
		maintain all of its assets, as they from time to time exist, in the Account,
		except for such amounts as may be necessary or desirable to be maintained in a
		bank account or with a broker to facilitate OTC currency transactions and the
		payment of Customer expenses, redemptions, or distributions.  Citigroup
		Managed Futures (“CMF”) will inform CGM immediately in writing if, at
		any time, CMF, CGM, and/or their principals or employees (collectively,
		“Proprietary Owners”) collectively own 10 percent or more of the
		Customer.  At any time that Proprietary Owners cease to own 10 percent or
		more of the Customer, CMF will inform CGM immediately in writing of that fact.
		 At any time when Proprietary Owners collectively own 10 percent or more
		of the Customer, the Customer and CMF understand and agree that, pursuant to
		Applicable Law, CGM will treat the Account as a proprietary account and will
		not segregate the assets of the account pursuant to the CEA or CFTC rules, or
		secure those assets of the Account used to margin foreign futures positions.
	 

	 
		(b)  The Customer shall pay to CGM, in lieu of brokerage commissions
		on a per trade basis, a monthly flat rate brokerage fee equal to 3.75 percent
		per year of the Customer’s monthly net assets (computed by multiplying the
		Customer’s net assets as of the last business day of each month by 3.75
		percent and multiplying the result thereof by the ratio which the total number
		of calendar days in that month bears to 365 days).  The Customer shall
		also pay all floor brokerage, NFA fees, exchange, clearing, user, and give-up
		fees, or shall reimburse CGM for all such fees previously paid by CGM on the
		Customer’s behalf.  CGM’s fee may be increased or decreased at
		any time at CGM’s discretion upon written notice to the Customer.
	 

	 
		(c)  The Account (including any additional accounts of the fund
		opened pursuant to the Agreement) shall be held in and administered by
		CGM’s Branch #258.  CGM, on instructions from CMF, shall place up to
		100 percent of the Customer’s assets in 90-Day U.S. Treasury Bills.
		 Those assets not so invested may be held in US dollars, in any Money
		Center Currency, as defined by CFTC Rule 1.49, any other foreign currencies
		permissible under CFTC rules as in effect from time to time, or any combination
		of the preceding.  CGM will compute interest on those assets not invested
		in 90-Day U.S. Treasury Bills according to its standard protocols.  Within
		ten (10) days following the end of a calendar month, a net sum representing the
		balance history and interest calculations of the Account (and like accounts
		managed by CMF in Branch #258) shall be credited to CMF, who will be
		responsible for crediting the Customer for such amounts as may be due in
		accordance with the Customer’s offering documents.
	 

	 
		(d)  (i) In any action, suit, or proceeding to which CGM is a party
		or is threatened to be made a party by reason of the fact that it is or was the
		futures broker for the Customer (other than any action brought by or on behalf
		of the Customer), the Customer shall indemnify and hold harmless CGM, subject
		to subsection (ii) below, against any loss, liability, damage, cost, expense
		(including reasonable attorney’s fees and accountant’s fees),
		judgments, and amounts paid in settlement actually and reasonably incurred by
		it in connection with such action, suit or proceeding if CGM acted in good
		faith and in a manner it reasonably believed to be in the best interests of the
		Customer, except that no indemnity shall be made in respect of any claim, issue
		or matter which as to CGM constituted negligence, misconduct, or breach of its
		legal obligations to the Customer, unless, and only to the extent that, the
		court or tribunal in which action or suit was brought shall determine upon
		application that, despite the adjudication of liability but in view of all
		circumstances of the case, CGM is fairly and reasonably entitled to
		indemnification for such expenses which are proven; and further provided that
		no indemnification shall be available from the Customer if such indemnification
		is prohibited by the Customer’s Private Placement Offering Memorandum and
		Disclosure Document.  The termination of any action, suit, or proceeding
		by judgment, order, or settlement,
	 

	 
		
 

	 

	 
		Page 3 of 16
	 

	 
		

	 

	 
		

	 

	  

	 

	 
		

	 

	 
		

	 

	 
		 shall not, in itself, create a presumption that CGM did not act in
		good faith and in a manner which it reasonably believed to be in or not opposed
		to the best interests of the Customer.
	 

	 
		(e)  Any indemnification under subsection (d) of this section 4,
		unless ordered by a court, shall be made by the Customer only as authorized in
		the specific case and only upon a determination by independent legal counsel in
		a written opinion that the indemnification is proper in the circumstances and
		accordance with the terms of this Addendum.
	 

	 
		(f)  As used in this section 4, the term CGM shall include CGM, its
		officers, directors, stockholders, employees, and affiliates.
	 

	 
		5. Customer Payment Obligations.  With respect to
		every Contract purchased, sold or cleared for the Account, Customer shall (a)
		make all applicable margin and premium payments and perform all other
		obligations attendant to transactions or positions in such Contracts, as such
		payments or performance may be required by CGM consistent with Applicable Law,
		and (b) pay CGM upon demand (i) all commissions and fees at rates mutually
		agreed upon, (ii) all contract market, clearing house or clearing firm fees or
		charges, (iii) any tax or fee imposed on such transactions by any competent
		authority, including any self-regulatory organization, (iv) the amount of any
		trading losses in the Account, (v) any debit balance or deficiency remaining in
		the Account upon liquidation of any Contract held in the account; and (vi)
		interest on any debit balances remaining in the Account at the overnight rate
		customarily charged by CGM, together with all reasonable costs and expenses
		(including without limitation reasonable attorneys’ fees) incurred in
		collecting any such debit balance or in exercising any rights specified in
		Section 6 of this Agreement.
	 

	 
		6.  Security Interest and Collateral.  (a) All
		property of Customer held by or for CGM or any affiliate of CGM or due from any
		exchange or clearing broker in respect of any Contract bought or sold for the
		Account (collectively, “Collateral”) is hereby pledged to CGM and
		shall be subject to a security interest in CGM’s favor to secure any
		amounts at any time owing from Customer to CGM.  The parties agree that to
		the extent permitted by Applicable Law, the Account and the Collateral are
		“financial assets” as defined in Revised Article 8 of the Uniform
		Commercial Code as in effect in the State of New York (“UCC”) and
		that during the term of this Agreement CGM shall have absolute control over the
		Collateral, provided, however, that with CGM’s approval any excess
		Collateral may be withdrawn at any time upon Customer’s request.  (b)
		CGM is authorized, to the extent permitted by Applicable Law, from time to time
		and without notice to Customer, to invest, lend, pledge, repledge, enter into
		repurchase agreements with or for, hypothecate, or rehypothecate to itself or
		to others, for CGM’s account and benefit, Collateral (including but not
		limited to metals, warehouse receipts, or other negotiable instruments) held by
		CGM for Customer, and may fulfill any obligations to Customer by delivery of
		nonidentical property of like kind and amount.
	 

	 
		7.  Customer Defaults and Rights on Default.  The
		occurrence of any of the following shall be an “Event of Default”
		under this Agreement:  (a) the issuance of any warrant or order of
		attachment against the Account or levying of any judgment against the Account;
		(b) Customer’s failure to make when due any payment or delivery under this
		Agreement or Customer otherwise breaches any term of this Agreement; (c) if
		Customer is a natural person, Customer dies or is adjudicated incompetent, and
		for all Customers, Customer becomes insolvent or commences or has commenced
		against it any action for the appointment of a trustee, receiver, administrator
		to or for its liquidation, winding up or dissolution, or for the
		reorganization, composition or arrangement of its debts, or any other procedure
		under any law of any applicable jurisdiction having the same or analogous
		effect, and, in the case of any such action commenced involuntarily against
		such Customer, the action is not stayed or dismissed within 15 (fifteen) days;
		(d) Customer fails or admits its inability to pay its debts generally as they
		become due, or there is a material adverse change in Customer’s financial
		condition or net asset value; (e) Customer defaults on a material obligation
		under any other agreement between Customer and CGM or any of CGM’s
		affiliates; (f) any representation made by Customer in this Agreement or in any
		form required by this Agreement proves to have been false or misleading in any
		material respect when given; or (g) CGM in its discretion reasonably considers
		it necessary for its protection.  Upon the occurrence of any Event of
		Default, CGM shall have the right, in addition to any other remedy available to
		CGM at law or in equity, to liquidate any or all open Contracts held in or for
		the Account by any means of lawful disposition (including without limitation
		through any exchange of futures for physicals, block trade, or similar
		transaction permitted under applicable exchange rules), to apply any cash,
		securities or other property of Customer held by or for CGM
	 

	 
		
 

	 

	 
		Page 4 of 16
	 

	 
		

	 

	 
		

	 

	  

	 

	 
		

	 

	 
		

	 

	 
		 or any of CGM’s affiliates toward amounts payable by Customer
		hereunder, to reduce any amounts due and owing to Customer by setting off
		against such amounts any amounts due to CGM or any of CGM’s affiliates by
		Customer and to convert any such amounts or the net of such amounts to a single
		currency, to hedge positions in the Account, and to take any other action in
		respect of the Account, all in a commercially reasonable manner and all without
		further demand for margin and without notice or advertisement, except CGM will
		make reasonable efforts under the circumstances to notify Customer prior to
		taking any such action if CGM’s position would not be jeopardized thereby.
		 Solely for purposes of this Section 7, the term “affiliates”
		shall mean Citigroup Global Markets Holdings Inc. and any entity controlled by
		it, but shall not include any entity that controls or is under common control
		with Citigroup Global Markets Holdings Inc.
	 

	 
		8.  Treatment of Foreign Currency Payments and Balances.
		 If any transaction for Customer’s Account is effected on any
		exchange or in any market on which transactions are settled or margined in
		foreign currency (including, without limitation, the Euro or another unit of
		currency adopted pursuant to the European Monetary Union):  (a) any profit
		or loss arising from a fluctuation in the rate of exchange between such
		currency and the United States Dollar shall be entirely for Customer’s
		Account and at Customer’s risk; (b) unless otherwise agreed by Customer
		and CGM, all initial and subsequent margin deposits required or requested by
		CGM shall be in or denominated in the currency required by the applicable
		exchange or clearing house in such amounts as CGM, in its sole discretion, may
		require; and (c) CGM is authorized to convert funds or securities in
		Customer’s Account into and from such foreign currency at prevailing rates
		of exchange.  If Customer has entered into a prime broker agreement with
		CGM, CGM is authorized to convert balances in the Account to a single currency
		in accordance with such prime broker agreement and any supplements or annexes
		thereto.
	 

	 
		9.   Transfer of Excess Funds to/from Other Accounts.
		 In the event that Customer establishes and maintains other accounts at
		CGM, until Customer gives further notice to CGM in writing, CGM is hereby
		authorized to transfer from the Account to any such other account such excess
		funds as may be required to avoid a margin call in such other account, to
		obtain interest credits or increase interest credits received by Customer, or
		as CGM reasonably determines necessary to satisfy any obligations of Customer
		to CGM in respect of such account, provided such transfer is not in conflict
		with Applicable Law.  CGM is also authorized to transfer to the Account
		any excess funds in any other account of Customer at CGM not required to meet
		margin, security, or other requirements related to such other account, to the
		extent that such excess funds are necessary to meet margin requirements or
		deficits in the Account.  CGM agrees that it will provide Customer with
		written confirmation of any such transfers within a reasonable time.
	 

	 
		10.  Over the Counter Transactions.  If Customer is
		permitted by CGM to engage, and does engage in the purchase or sale of forward
		contracts or options on foreign currency in the Account, Customer will be bound
		by the terms of the “Foreign Exchange Trading Supplement” to this
		Agreement, which is appended hereto.  If Customer enters into any over the
		counter swap, forward, option, or similar transaction involving energy products
		that is, with CGM’s consent, cleared under the rules of an applicable
		exchange and/or clearing house, Customer will be bound by the terms of the
		“OTC Energy Supplement” to this Agreement, which is appended hereto.
		 If Customer engages in the over the counter purchase or sale of coins,
		bullion, or metals in the Account, Customer agrees that:  (a) actual
		deliveries are intended on all such transactions; (b) CGM may be acting as a
		broker or as a dealer in any such transaction, and CGM will inform Customer of
		the capacity in which it is acting in any particular transaction upon
		Customer’s request; (c) such transactions are not cleared through any
		clearing house and, when CGM is acting as a dealer, the contract for purchase
		or sale is between Customer and CGM; (d) when CGM is acting as a broker CGM
		does not warrant the authenticity, grade, or quality of any metals or coins;
		(e) if Customer requests CGM to store metals or coins rather than to carry them
		on an unallocated basis, Customer understands that such metals or coins will be
		placed in a depository selected by CGM in its sole discretion and may be
		commingled with metals or coins of CGM or other Customers, and that all taxes,
		shipping, storage, and insurance fees will be Customer’s responsibility;
		and (f) CGM may in its sole discretion elect to net settle payments when those
		payments are for the same currency and value date.
	 

	 
		11.  LME Transactions.  If Customer engages in
		transactions in Contracts purchased, sold, or cleared on the London Metal
		Exchange (“LME contracts”), Customer understands and agrees that:
		 (a) while CGM acts only as agent in such transactions, orders for LME
		contracts placed with CGM will be executed by an affiliate of CGM which will
		act as principal in any LME contract bought or sold;
	 

	 
		
 

	 

	 
		Page 5 of 16
	 

	 
		

	 

	 
		

	 

	  

	 

	 
		

	 

	 
		

	 

	 
		(b) CGM’s affiliate has no obligation of best execution as regards
		LME contracts; and (c) CGM will endeavor to find the best price with available
		LME brokers, which may include its affiliate, and such price may include a
		mark-up.
	 

	 
		12.  Introducing Brokers.  If Customer’s Account
		has been introduced to CGM by an introducing broker, CGM is responsible only
		for the execution, clearing, and bookkeeping of transactions, and shall have no
		liability for the acts or omissions of the introducing broker.
	 

	 
		13.  Limitations of Liability.  IN NO EVENT WILL CGM BE
		RESPONSIBLE FOR ANY LOSSES TO CUSTOMER OTHER THAN DIRECT LOSSES ARISING SOLELY
		AS A RESULT OF CGM’S NEGLIGENCE OR WILLFUL MISCONDUCT.  NO PARTY TO
		THIS AGREEMENT SHALL BE REQUIRED TO PAY OR BE LIABLE TO ANY OTHER PARTY FOR ANY
		CONSEQUENTIAL, INDIRECT, OR PUNITIVE DAMAGES, OPPORTUNITY COSTS, OR LOST
		PROFITS (WHETHER OR NOT ARISING FROM ITS NEGLIGENCE AND REGARDLESS OF WHETHER
		THE PARTY WAS AWARE OF THE POSSIBILITY OF SUCH DAMAGES).  CGM SHALL NOT BE
		LIABLE IF THE PERFORMANCE OF ITS OBLIGATIONS UNDER THIS AGREEMENT IS DELAYED OR
		RENDERED IMPOSSIBLE DUE TO FIRE, FLOOD, STRIKE, WAR, ACT OF TERRORISM, ACT OF
		GOD, GOVERNMENTAL ACTION, OR ANY OTHER CAUSE BEYOND CGM’S CONTROL.
		 IN ANY SUCH CASE, CGM MAY IN ITS REASONABLE DISCRETION CANCEL ORDERS
		RESTING ON ELECTRONIC ORDER ENTRY OR EXECUTION SYSTEMS.  ORDERS FOR THE
		ACCOUNT MAY FROM TIME TO TIME BE ENTERED, EXECUTED, OR BOTH THROUGH ELECTRONIC
		ORDER ENTRY OR EXECUTION SYSTEMS.  IN ANY SUCH CASE, CGM SHALL HAVE NO
		LIABILITY FOR ANY LOSS INCURRED BY CUSTOMER DUE TO THE FAILURE OR MALFUNCTION
		OF ANY COMPUTER HARDWARE OR SOFTWARE OR TRANSMISSION DEVICE OR SERVICE UTILIZED
		UNLESS SUCH FAILURE OR MALFUNCTION DIRECTLY RESULTS FROM CGM’S GROSS
		NEGLIGENCE OR WILLFUL MISCONDUCT.
	 

	 
		14.  Recordings.  CGM, in its sole discretion, may
		record on tape or otherwise any telephone conversation between Customer and
		CGM, including their respective employees, officers, and agents, and Customer
		hereby agrees and consents to such recording.
	 

	 
		15.  Confirmations, Notices.  All trade confirmations
		and account statements shall be conclusive unless Customer notifies CGM in
		writing of any objection thereto within three business days following the day
		on which CGM transmits such confirmation or statement, unless CGM transmits
		such confirmation or statement electronically or by facsimile, in which case
		Customer shall notify CGM of any objections by 5:00 p.m. New York time the next
		business day following transmission.  All oral instructions or notices
		given by Customer in respect of the maintenance of the Account shall be
		promptly confirmed in writing by the Customer.  All instructions, notices
		or other communications concerning this Agreement or maintenance of the Account
		shall be given to Customer at the address or phone number identified on the
		signature page hereof and to CGM at the office or branch that services
		Customer’s Account, with a copy to:
	 

	 
		Citigroup Global Markets Inc.
 388 Greenwich St., Seventh Floor

		New York, New York 10013
 Attention:  Futures Division (Notifications)
		
 Fax:   (212) 723-8977
	 

	 
		CGM shall be entitled to rely on any instructions, notices, and
		communications from Customer and, if applicable, Account Manager, respecting
		orders, delivery, exercise, or settlement, that CGM reasonably believes to be
		genuine and such instructions shall bind Customer.  Customer agrees to
		hold CGM harmless against all costs, losses, penalties, fines, taxes, and
		direct damages incurred by CGM as a result of any action taken or not taken by
		CGM in reliance upon such instructions, notices, and communications.
	 

	 
		16.  Role of Account Manager.
	 

	 
		(a)  Customer may authorize a third party or entity (the
		“Account Manager”) to manage the Account.  Where Customer
		retains an Account Manager, Customer agrees that Account Manager is authorized
		to act on Customer’s behalf with respect to the Account, including to
		receive and give communications, instructions and authorizations, and Customer
		hereby
	 

	 
		
 

	 

	 
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		confirms, ratifies, and assumes liability for any transactions that
		result from such communications, instructions, and authorizations.
		 Customer will provide CGM with the management agreement between the
		Customer and Account Manager as evidence of this authority.
	 

	 
		(b)  When an Account Manager has discretion over the Account,
		Customer authorizes the Account Manager holding that discretion to enter into
		all arrangements that are necessary or appropriate in the sole judgment of the
		Account Manager to carry out Customer’s obligations under the Agreement or
		under the trading authorization granted by Customer to Account Manager.
		 This shall include, without limitation, the selection of executing
		brokers to execute transactions for Customer’s Account, negotiation of
		agreements with or including such executing brokers (including without
		limitation Uniform International Brokerage Execution (“Give-Up”)
		Agreements), and negotiating and agreeing to additional charges or fees in
		amounts up to but not in excess of $2.00 per side.  Such additional
		charges or fees may take the form of excess floor brokerage, administrative or
		intermediary FCM transfer fees.
	 

	 
		(c)  When an Account Manager has discretion over the Account,
		Customer authorizes CGM to remit periodically from the Account such sums
		representing the bills of the Account Manager or any executing broker or floor
		broker (including any fees attendant to the execution of Contracts by such
		brokers) the Account Manager has selected upon presentation of said bill to
		CGM.  Customer understands and agrees that:  (i) CGM shall have no
		obligation to determine the accuracy of any such bills presented, and Customer
		agrees to indemnify and hold harmless CGM from any claims in the event that
		such bills are not correct; (ii) Customer, Account Manager, and any executing
		broker are solely responsible for computing fees for the Account Manager’s
		services and the services of the executing broker and that CGM may rely upon
		such computation submitted to it by Account Manager or any executing broker;
		(iii) any disbursement pursuant to Customer’s authorization will be
		reflected on Customer’s monthly statement of account furnished by CGM.
		 The authorizations and agreements shall remain in force and effect until
		terminated by Customer in writing to CGM, and shall not be affected by
		Customer’s disability or incompetence.  CGM reserves the right in its
		sole discretion to cancel this authorization at any time with or without
		notice.  Customer’s indemnities shall survive termination of the
		Agreement.
	 

	 
		(d)  Customer ratifies and confirms all transactions entered into by
		any Account Manager with or through CGM for the Account.
	 

	 
		17.  Remedies Not Exclusive.  The specification of any
		right or remedy in this Agreement shall not be exclusive of any other remedies
		provided by law.  Any delay or failure by any party to this Agreement to
		exercise any right or remedy shall not be construed to be a waiver of such
		right or remedy, and no single, partial or other exercise of any right or
		remedy shall preclude the further exercise of that right or remedy or the
		exercise of any other right or remedy.
	 

	 
		18.  Term and Termination.  This Agreement shall
		continue in force until terminated by either Customer of CGM.  This
		Agreement may be terminated by Customer or CGM by written notice to the other.
		 In the event of such notice, Customer shall within 15 days either close
		out open positions in the Account or transfer such open positions to another
		Futures Commission Merchant.  This Agreement shall terminate upon
		satisfaction by Customer of all liabilities to CGM arising hereunder (including
		payment of the applicable commission with respect to the transfer of Contracts
		to another futures commission merchant) and the transfer or close out of all
		Contracts and all other property held in the Account.  The termination of
		this Agreement shall not affect the obligations of the parties hereto arising
		from transactions entered into prior to such termination.
	 

	 
		19.  Choice of Law, Waiver of Jury.  THE INTERPRETATION
		AND ENFORCEMENT OF THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
		NEW YORK, without giving effect to its conflicts of laws principles.
		 Subject to Customer’s right to initiate a reparations proceeding
		pursuant to the CEA and rules thereunder, Customer submits to the jurisdiction
		of the courts of the State of New York and of the federal courts in the
		Southern District of New York with respect to any proceeding arising out of and
		relating to this Agreement or any transaction in connection herewith, and
	 

	 
		
 

	 

	 
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		waives any objection to jurisdiction it may otherwise be entitled to
		assert in any such proceeding.  The parties hereby irrevocably waive any
		right to a jury trial in any matter arising under or relating to this
		Agreement.
	 

	 
		20.  Entire Agreement, Successors and Assignment.  This
		Agreement, including any applicable supplements, contains the entire agreement
		between the parties and supersedes any prior agreements as to the subject
		matter hereof.  No provision of this Agreement shall in any respect be
		amended or deemed to be waived unless such amendment or waiver is in writing
		and signed by the parties.  This Agreement and any confirmation or
		“purchase and sales statement” relating to Contracts purchased or
		sold for the Account shall constitute a single agreement between Customer and
		CGM.  This Agreement shall be binding on and inure to the benefit of the
		parties hereto and their successors, CGM’s assigns, and Customer’s
		personal representatives, estate, heirs, administrators and trustees, if any.
		 This Agreement shall not be assignable by Customer.  Section
		headings have been included solely for the convenience of the parties and do
		not constitute part of this Agreement.
	 

	 
		21.  By checking the box below, Customer acknowledges that it has
		received and understands the disclosure or election noted:
	 

	 
		      CFTC Risk Disclosure
		Statement for Futures and Options (which includes disclosure required by CFTC
		rules 1.55, 30.6, 33.7, and 190.10(c)) separately furnished to Customer by
		CGM.
	 

	 
		

	 

	 
		      Authorization to Transfer
		Funds (section 9).
	 

	 
		IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
		 
	 

	 
		Customer
	 

	 
		Name of Customer:  Smith Barney Bristol Energy Fund L.P.
	 

	 
		Authorized Signature:  /s/ Daniel R. McAuliffe, Jr.
	 

	 
		Date:
		                    

	 

	 
		Print Name:  Daniel R. McAuliffe, Jr.
	 

	 
		Title:  CFO and Director
	 

	 
		NOTICES AND STATEMENTS DELIVERED TO:
	 

	 
		Address:  Attn:  Jennifer Magro, 731 Lexington Avenue,
		25th Floor
	 

	 
		New York, NY  10022
	 

	 
		Telephone:  212-559-2011
	 

	 
		

	 

	 
		Appendix A – Authorized Persons
	 

	 
		The following persons have been authorized to place orders and give
		instructions to CGM on behalf of Customer with respect to Customer’s
		Account:
	 

	 			
	
			 
				Print Name
			 

		  	
			 
				 
			 

		  	
			 
				Signature
			 

		  
	
			 
				 
			 

		  	
			 
				 
			 

		  	
			 
				 
			 

		  
	
			 
				 
			 

		  	
			 
				 
			 

		  	
			 
				 
			 

		  
	
			 
				 
			 

		  	
			 
				 
			 

		  	
			 
				 
			 

		  
	
			 
				 
			 

		  	
			 
				 
			 

		  	
			 
				 
			 

		  

	 
		

	 

	 
		
 

	 

	 
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		Appendix B – Wire Instructions
	 

	 
		Until further written notice, CGM is hereby authorized to transfer/wire
		funds due to Customer from the Account to the bank account listed below.
		 CGM is further authorized to act on instructions from Customer or
		Customer’s agent to transfer/wire funds whether such instructions are oral
		or in writing.  Customer understands and agrees that any instruction(s)
		that deviates from this standing instruction must be made or confirmed in
		writing to CGM before CGM will act on such instruction(s).  Customer
		agrees to indemnify and hold harmless CGM, its officers, directors, employees,
		and agents, from all loss, cost, claims, and expenses (including reasonable
		attorney’s fees arising from these wire instructions or any written
		deviations therefrom).
	 

	 
		Bank Name:               
		                     
		                     
		                     
		       ABA Number:        
		                     
		                     
		                     
		               
	 

	 
		For the Account of:              
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		   
	 

	 
		Account Number:              
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		      
	 

	 
		(and if applicable:) 
	 

	 
		For Further Credit to:            
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		   
	 

	 
		Account Number:              
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		                     
		       
	 

	 
		
 

	 

	 
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		Part II
	 

	 
		Authorization for Transactions in Which CGM May Be on the Opposite
		Side of Customer Trades
	 

	 
		The undersigned consents to transactions whereby CGM, its directors,
		officers, employees or affiliates, and any floor broker acting on
		Customer’s behalf in any transaction, may be on the opposite side of
		orders for the purchase or sale of futures contracts and option contracts
		placed for such Customer’s Account in conformity with regulations of the
		Commodity Futures Trading Commission and the bylaws, rules and regulations of
		the contract market (and its clearing house, if any) on which such order is
		executed.
	 

	 
		Customer:
	 

	 
		By:
		                                                                                                                       

	 

	 
		Print Name:
		                                                                                                        

	 

	 
		Title:
		                                                                                                                   

	 

	 
		Date:
		                                                                                                                  

	 

	 
		
 

	 

	 
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		Part III
	 

	 
		Supplements for Certain Products
	 

	 
		Foreign Exchange Trading Supplement
	 

	 
		In the event that CGM authorizes Customer to enter into, and Customer
		enters into over the counter spot or forward purchases and sales of foreign
		currency or options on foreign currency (collectively, “FX
		Transactions”) to be held in Customer’s futures account at CGM (the
		“Account”), the following terms and conditions (the “FX
		Supplement”) shall supplement the Institutional Futures Account Agreement
		(the “Agreement”) between CGM, Customer, and, if applicable, Account
		Manager.  Unless otherwise specified in this FX Supplement, all
		capitalized terms used herein shall have the meaning defined in the Agreement.
	 

	 
		1.  FX Transactions shall be deemed to be Contracts for all
		purposes of the Agreement unless otherwise specified herein.
	 

	 
		2.  In addition to those representations made by Customer in
		Section 1 of the Agreement, Customer represents that:  (a) it is an
		“eligible contract participant” within the meaning of Section 1(a)12
		of the CEA; and (b) it is neither (i) an “employee benefit plan” as
		defined in Section 3(3) of the Employee Retirement Income Security Act of 1972
		(“ERISA”) which is subject to Part 4 of Subtitle B of Title I of such
		Act; (ii) any “plan” as defined in Section 4975(e)(1) of the Internal
		Revenue code of 1986; nor (iii) any entity the assets of which are deemed to be
		assets of any such “employee benefit plan” or “plan” by
		reason of the Department of Labor’s plan asset regulation, 29 C.F.R.
		Section 2510.3-101, OR that neither this FX Supplement nor the FX Transactions
		are subject to the prohibited transaction rules of ERISA.  These
		representations shall be continuing representations at all times when Customer
		enters into or maintains any FX Transaction in the Account.
	 

	 
		3.  The parties agree that:
	 

	 
		(a)  CGM acts as a principal in FX Transactions subject to this FX
		Supplement and such FX Transactions are not cleared through or guaranteed by
		any clearing house or clearing agency;
	 

	 
		(b)  Customer’s counterparty on all options on foreign currency
		shall be Citigroup Global Markets Commercial Corp., its successors or assigns,
		or such other affiliate of CGM that CGM identifies in writing to Customer
		(“CGMCC”).  If Customer enters into any option on foreign
		currency, (i) CGMCC shall have all rights of CGM under the Agreement and this
		FX Supplement, and all references herein to CGM shall include CGMCC, and (ii)
		all representations made by Customer to CGM shall be deemed made to CGMCC; and
	 

	 
		(c)  FX Transactions are generally exempt from the CEA and CFTC
		rules.  Without limiting the foregoing, cash, securities, or other
		property (collectively, “Collateral”) Customer transfers to or
		maintains at CGM or any of CGM’s affiliates as margin in respect of FX
		Transactions will not be subject to the segregation requirements of the CEA and
		CFTC rules, CGM will not hold such Collateral in a Customer segregated account,
		and Customer will not, as to such Collateral, receive the special treatment of
		bankruptcy rules applicable to futures transactions pursuant to U.S. law.
	 

	 
		4.  With respect to every FX Transaction entered into by
		Customer, Customer shall (a) make all payments required by any collateral annex
		between Customer and CGM; (b) make all applicable premium payments and perform
		all other obligations attendant to FX Transactions or positions as such
		payments or performance may be required by CGM consistent with Applicable Law;
		and (c) make all other payments and perform all obligations applicable to
		Contracts pursuant to Section 4 of the Agreement.
	 

	 
		5.  In the event that CGM exercises its rights to liquidate
		any FX Transaction pursuant to Section 6 of the Agreement, CGM shall determine
		in good faith using commercially reasonable procedures the amount of the costs
		and gains of CGM that would be incurred or realized to replace, or to provide
		the economic equivalent of the remaining payments, deliveries or option rights
		of all or some of the FX Transaction. CGM in making the determination may rely
		on internal or external sources, information, prices or models.
	 

	 
		6.  If on any business day (or, in accordance with market
		practice, business days) that the parties have agreed on the delivery of the
		currencies which were purchased and sold in respect of any FX
	 

	 
		
 

	 

	 
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		Transaction (the “Settlement Date”), more than one delivery of
		any currency is to be made between CGM and the Customer, then each party agrees
		that it shall aggregate the amounts of such currency deliverable to the other
		and only the difference between the aggregate amounts shall be delivered by the
		party owing the larger aggregate amount to the other and if the aggregate
		amounts are equal, no delivery of that currency shall be made.
	 

	 
		7.  If an Account Manager is authorized to exercise
		discretion and to act on behalf of Customer with respect to the Account, in
		addition to those representations made by Account Manager pursuant to Section
		15 of the Agreement, Account Manager represents that it is authorized to enter
		into FX Transactions on Customer’s behalf.
	 

	 
		8.  This FX Supplement and the Agreement shall be construed
		and applied in a manner that gives maximum effect to the terms and conditions
		of both.  In the event of any inconsistency, the terms of this FX
		Supplement shall apply and shall be deemed to be an amendment to the Agreement.

	 

	 
		Collateral Annex
	 

	 
		[Customers who are required to post collateral as a condition to doing
		business with CGM must complete the following Collateral Annex under the terms
		and conditions specified by a CGM credit officer.]
	 

	 
		This Collateral Annex supplements, forms part of, and is subject to, the
		Foreign Exchange Trading Supplement (the “FX Supplement”) between
		CGM, Customer, and, if applicable, Account Manager.  Capitalized terms not
		otherwise defined herein shall have the meanings given such terms in the
		Agreement and FX Supplement.
	 

	 
		1.
	 

	 
		For the purposes of this Collateral Annex each of following terms shall
		have the following meaning:
	 

	 
		“Banking Day” means any day on which commercial banks are open
		for general business (including dealings in foreign exchange and foreign
		currency deposits) in New York City.
	 

	 
		“Business Day” means any day on which CGM settles payments and
		is open for general business in New York.
	 

	 
		“Cash” shall mean the lawful currency of the United States of
		America transferred by Customer to CGM pursuant to this Collateral Annex.
	 

	 
		“Collateral” means all (i) Securities or Cash transferred by
		Customer to CGM pursuant to Section 2 of this Collateral Annex and (ii) any
		other Securities or Cash held from time to time in the Account.
	 

	 
		“Collateral Amount” shall mean 97% of the face amount of any
		Securities with a maturity of less than one year, 94% of the Market Value of
		any Securities with a maturity equal to or greater than 1 year, 100% of the
		Market Value of any Cash held in the Account as collateral.
	 

	 
		“Credit Support Amount” shall mean for any Valuation Day (i)
		the sum of the Market Value to CGM of each FX Transaction, plus (ii) the
		aggregate of all Independent Amounts, plus (iii) the Overcollateralization
		Amount, if any, minus (iv) the Threshold; provided, however, that (x) in the
		case where the sum of the Independent Amounts exceeds zero, the Credit Support
		Amount will not be less than the sum of all Independent Amounts; and (y) in all
		cases, the Credit Support Amount will be deemed to be zero whenever the
		calculation of the Credit Support Amount yields a number that is less than
		zero.  Nothing in this Collateral Annex shall prevent CGM from making more
		than one request for the payment or delivery of Collateral on any Valuation
		Day.
	 

	 
		“Independent Amount” shall mean for each FX Transaction
		$     , or such other Independent Amount as may be
		determined by CGM in its sole discretion.
	 

	 
		“Market Value” shall mean, with respect to any Security, FX
		Transaction or Cash, as the case may be, as of the date of determination, the
		price for such Security on such date obtained by CGM from
	 

	 
		
 

	 

	 
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		a generally recognized source selected by CGM, the price for such FX
		Transaction shall be the replacement value of the FX Transaction as determined
		by CGM (which amount shall not be less than zero), or (iii) with respect to
		Cash, the amount thereof.
	 

	 
		“Minimum Transfer Amount” means $20,000 where the total of all
		Overcollateralization Amounts is equal to or exceeds $200,000 and an amount to
		be determined by CGM where the total of all Overcollateralization Amounts is
		less than $200,000.
	 

	 
		“Overcollateralization Amount” means on any Valuation Day, (i)
		for FX Transactions on currencies traded on the International Monetary Market
		Exchange (the “IMM”), the amount in U.S. Dollars set by the IMM as
		initial margin on the outstanding currencies FX Transactions of similar tenor
		and notional amounts as traded on that exchange; and (ii) for FX Transactions
		on currencies not traded on the IMM, the amount in U.S. Dollars (assuming a
		default occurred on such Valuation Day) that CGM calculates in good faith in a
		commercially reasonable manner and with a 97.7% confidence factor, to be the
		maximum loss that CGM could expect to incur over the next five Banking Days
		based on the currencies comprising the then outstanding FX Transactions.
		 Nothing contained herein shall limit the right of CGM to change the
		criteria for factors on which the Overcollateralization Amount in clause (ii)
		is calculated, in its absolute discretion as market conditions or other factors
		warrant.
	 

	 
		“Securities” shall mean direct and general obligations of the
		United States of America and securities fully and unconditionally guaranteed as
		to the timely payment of principal and interest by the United States of
		America.
	 

	 
		“Threshold” shall mean $     ,
		or if no amount is specified, zero.
	 

	 
		2.
	 

	 
		If, on any Valuation Day, the Credit Support Amount is more than the
		Collateral Amount (a “Margin Deficit”), then Customer shall transfer
		additional Securities or Cash to CGM, so that the Collateral Amount will
		thereupon equal or exceed the Credit Support Amount.  Customer shall have
		the option to transfer either Securities, Cash or a combination of Securities
		and Cash whenever it is required to make a transfer to CGM.
	 

	 
		3.
	 

	 
		If, on any Valuation Day, the Credit Support Amount is less than the
		Collateral Amount (a “Margin Excess”), then CGM shall, at the written
		instruction of Customer, transfer Securities or Cash to Customer, so that the
		Collateral Amount will thereupon not exceed the Credit Support Amount.
		 Customer shall direct CGM as to whether to transfer Securities, Cash or a
		combination of Securities and Cash whenever CGM is required to make a transfer
		to Customer.
	 

	 
		4.
	 

	 
		On each Business Day, CGM shall determine the Credit Support Amount and
		the Collateral Amount (a “Valuation Day”), and in the event of a
		Margin Deficit or Margin Excess shall provide the Customer with facsimile
		notice of such determination.
	 

	 
		5.
	 

	 
		To the extent required by applicable law, all Securities and Cash in the
		possession of CGM shall be identified on the books and records of CGM as
		subject to the FX Supplement.  CGM shall have the right to sell, pledge,
		rehypothocate, assign, invest, use, commingle or otherwise dispose, or
		otherwise use, any Collateral it holds and to register any Collateral in its
		name, its custodian or any nominee for either.
	 

	 
		6.
	 

	 
		CGM will exercise reasonable care to assure the safe custody of all
		Collateral to the extent required by applicable law, and in any event CGM will
		be deemed to have exercised reasonable care if it exercises at least the same
		degree of care as it would exercise with respect to its own property.
		 Except as specified in the preceding paragraph, CGM will have no duty
		with respect to the Collateral including any due to collect any distributions
		or enforce or preserve any rights pertaining thereto.
	 

	 
		7.
	 

	 
		The Customer hereby agrees and acknowledges that, subject to the FX
		Supplement, any Securities or Cash delivered hereunder shall be delivered for
		purposes of securing Customer’s obligations in respect of FX Transactions
		entered into pursuant to the FX Supplement.  Customer represents and
		warrants to CGM that (i) it has the power to grant a security interest in and
		lien on any Collateral it transfers to CGM and has taken all necessary actions
		to authorize the granting of that security interest and lien, (ii)
	 

	 
		
 

	 

	 
		Page 13 of 16
	 

	 
		

	 

	 
		

	 

	  

	 

	 
		

	 

	 
		

	 

	 
		it is the sole owner of or otherwise has the right to transfer all
		Collateral it transfers to CGM hereunder, free and clear of any security
		interest, lien, encumbrance or other restriction other than the security
		interest and lien granted hereunder, (iii) upon the transfer of any Collateral
		hereunder, CGM will have a valid and perfected first priority security interest
		therein, (iv) the performance of its obligations hereunder will not result in
		the creation of any security interest, lien or other encumbrance on any
		Collateral other than the security interest and lien created hereunder, and (v)
		the transfer of Collateral hereunder does not, and will not, violate any other
		agreement.  Customer hereby grants to CGM, as security for the performance
		by Customer of its obligations under the FX Supplement, a first priority
		continuing security interest in, lien on and right of set-off against all of
		the Collateral delivered by Customer pursuant to this Collateral Annex.
	 

	 
		8.
	 

	 
		Upon receipt by CGM of evidence that Customer shall have satisfied all of
		its obligations under the FX Supplement, then CGM shall promptly pay over and
		deliver or transfer to Customer all of the Collateral and Independent Amount
		not previously applied or returned pursuant to the provision of this Collateral
		Annex.
	 

	 
		9.
	 

	 
		Notwithstanding Sections 2 and 3 of this Collateral Annex, neither party
		shall make any deliveries of Securities of Cash unless the Margin Deficit or
		Margin Excess exceeds the Minimum Transfer Amount and each such Margin Deficit
		or Margin Excess shall be rounded to the nearest $1,000.
	 

	 
		10.
	 

	 
		All transfers of Collateral shall be made by the close of business on the
		day notification is received.
	 

	 
		11.
	 

	 
		If CGM receives any principal, interest or other payment with respect to
		the Collateral it will promptly transfer such payments to Customer provided
		that the Collateral Amount exceeds the Credit Support Amount.
	 

	 
		12.
	 

	 
		Each party will pay its own costs and expenses in connection with
		performing its obligations under this Collateral Annex and neither party shall
		be liable for any costs and expenses incurred by the other party in connection
		herewith, provided that the Customer will pay (i) when due all taxes,
		assessments or charges of any nature that are imposed on the Collateral held by
		CGM upon becoming aware of same and (ii) all reasonable costs and expenses
		incurred by or on behalf of CGM in connection with the liquidation and/or
		application of the Collateral under Section 5 of the FX Supplement.
	 

	 
		13.
	 

	 
		Promptly following demand by CGM, Customer will execute, deliver and
		record any financing statement, specific assignment or other document and take
		any other action that may be necessary or desirable and reasonably requested by
		CGM to create, perfect, preserve or validate any security interest or lien
		granted under this Collateral Annex and to enable CGM to enforce its right with
		respect thereto.  Customer will promptly give notice to CGM of, and defend
		against, any suit, action, proceeding or lien that involves Collateral
		transferred to CGM or that could adversely affect the security interest or lien
		granted to CGM hereunder.
	 

	 
		
 

	 

	 
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		OTC Energy Supplement
	 

	 
		The following terms and conditions (the “OTC Energy
		Supplement”) shall supplement Customer’s Institutional Futures
		Account Agreement (the “Agreement”) with Citigroup Global Markets
		Inc. (“CGM”).  Unless otherwise specified in this OTC Energy
		Supplement, all capitalized terms used herein shall have the meaning defined in
		the Agreement.

	 

	 
		1.  Customer agrees that this OTC Energy Supplement shall
		apply to all over the counter (“OTC”) swaps, forwards, options, or
		similar transactions involving oil, natural gas, electricity, and other energy
		products that are executed and/or cleared in the Account, including without
		limitation transactions by Customer on or through the Intercontinental Exchange
		(“ICE”) and transactions that are cleared on the NYMEX (collectively,
		“OTC Energy Transactions”).  Except as otherwise specifically
		provided in this OTC Energy Supplement, OTC Energy Transactions shall be deemed
		to be Contracts for all purposes of the Agreement.

	 

	 
		2.  In addition to those representations made by Customer in
		Section 1 of the Agreement, Customer represents and warrants to CGM that:

	 

	 
		(a)  it is duly authorized to enter into OTC Energy Transactions and
		to perform all obligations attendant to such transaction in accordance with
		their terms;

	 

	 
		(b)  it is, and at the time it enters into any OTC Energy
		Transaction it will be, an “Eligible Contract Participant” as defined
		by Section la(12) of the CEA;

	 

	 
		(c)  if client enters into any OTC Energy Transaction on the ICE, it
		is, and at the time any OTC Energy Transaction on the ICE remains open it will
		be, an “Eligible Commercial Entity” as defined by Section la(11) of
		the CEA; 

	 

	 
		(d)  it is neither (i) an “employee benefit plan” as
		defined in Section 3(3) of the Employee Retirement Income Security Act of 1972
		(“ERISA”) which is subject to Part 4 of Subtitle B of Title I of such
		Act; (ii) any “plan” as defined in Section 4975(e)(1) of the Internal
		Revenue code of 1986; nor (iii) any entity the assets of which are deemed to be
		assets of any such “employee benefit plan” or “plan” by
		reason of the Department of Labor’s plan asset regulation, 29 C.F.R.
		Section 2510.3-101, OR that neither the Agreement, as supplemented hereby nor
		any Contract are subject to the prohibited transaction rules of ERISA;

	 

	 
		(e)  prior to entering into any OTC Energy Transaction on the ICE,
		Customer will have entered into all necessary agreements to access and transact
		on ICE and that such agreements will remain in force at any time Customer
		enters into or maintains in the Account any OTC Energy Transaction on the
		ICE;

	 

	 
		(f)  Prior to handling delivery of any energy product pursuant to
		the terms of any OTC Energy Contract, Customer will obtain, and will maintain
		at all relevant times, any license, permit, approval, or authorization required
		by Applicable Law for Customer to purchase, sell, or hold such product,
		including without limitation any license required by the rules of the Federal
		Energy Regulatory Commission (“FERC”).

	 

	 
		3.  Customer understands and agrees that OTC Energy
		Transactions are governed by all applicable rules of the relevant exchange and
		clearing house, including without limitation the applicable rules and
		regulations of the ICE, NYMEX, and the London Clearinghouse (“LCH”),
		all of which shall be deemed to be Applicable Law, and by the terms and
		conditions of any user agreement or other agreement with any exchange or
		clearing house that Customer enters into in order to transact or clear OTC
		Energy Transactions.  Without limiting the foregoing, Customer understands
		and agrees that if any OTC Energy Transaction submitted to any clearinghouse
		for clearing is not accepted by such clearinghouse, the OTC Energy Transaction
		will be terminated automatically without obligation by any party, including CGM
		and CGM’s affiliates.

	 

	 
		4.  If Customer enters into any OTC Energy Transaction on the
		ICE, Customer understands and agrees that:

	 

	 
		(a)  transactions on or through ICE are generally exempt from the
		CEA and CFTC rules;

	 

	 
		(b)  cash, securities, or other property (collectively,
		“Collateral”) Customer transfers to CGM or any of CGM’s
		affiliates as margin in respect of OTC Energy Transactions engaged in on or
		through ICE will not be subject to the segregation requirements of the CEA and
		CFTC rules, CGM will not hold such Collateral in a Customer segregated account,
		and Customer will not receive the special treatment of bankruptcy rules
		applicable to U.S. futures and options pursuant to U.S. law;

	 

	 
		
 

	 

	 
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		(c)  CGM or its affiliates may transfer Collateral posted by
		Customer to the LCH, and in any such case Customer’s rights in an
		insolvency may be governed by English Law;
	 

	 
		(d)  Customer is solely responsible for the exercise of any OTC
		options entered into on or through ICE, and that unlike options traded on some
		other exchanges, CGM will have no role in effecting the exercise of options on
		ICE.

	 

	 
		5.  As to any OTC Energy Transactions entered into as
		“cleared transactions” on the ICE, Customer acknowledges and agrees
		that such cleared transactions shall be subject to LCH rules applicable to such
		transactions, and that:
	 

	 
		(a)  once such transactions are accepted for clearance by LCH, each
		such transaction will be a principal-to-principal transaction between Customer
		and CGM;
	 

	 
		(b)  LCH specifically disclaims any right or obligation to Customer
		in respect to such transactions, and Customer may be unable to make any claim
		against LCH in respect of such transactions; and
	 

	 
		(c)  LCH has the right to reject OTC Energy Transactions executed on
		the ICE and submitted for clearing and to suspend clearing of such transactions
		without notice.

	 

	 
		6.  CGM may in its sole discretion place conditions or
		limitations on the tenor, notional amount, or margin requirements for OTC
		Energy Transactions in the Account.  CUSTOMER UNDERSTANDS AND AGREES THAT
		CGM DOES NOT OFFER OR ENDORSE ANY ELECTRONIC OR OTHER SYSTEM CUSTOMER EMPLOYS
		TO ENTER INTO ANY OTC ENERGY TRANSACTION AND CGM IS NOT A PARTY TO ANY
		AGREEMENT BETWEEN CUSTOMER AND ANY EXCHANGE OR CLEARINGHOUSE. CGM SPECIFICALLY
		DISCLAIMS ALL LIABILITY FOR ANY LOSS, COST, OR DAMAGE OF ANY TYPE OR NATURE
		ARISING FROM OR RELATING TO CUSTOMER’S USE OF ANY SYSTEM OR DEVICE
		FURNISHED BY ANY EXCHANGE OR CUSTOMER’S OTC ENERGY TRANSACTIONS UNLESS
		DIRECTLY CAUSED BY CGM’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. WITHOUT
		LIMITING THE FOREGOING, NO PARTY TO THIS AGREEMENT SHALL BE REQUIRED TO PAY OR
		BE LIABLE TO ANY OTHER PARTY FOR ANY CONSEQUENTIAL, INDIRECT, OR PUNITIVE
		DAMAGES, OPPORTUNITY COSTS, OR LOST PROFITS (WHETHER OR NOT ARISING FROM ITS
		NEGLIGENCE).

	 

	 
		7.  In the case of any event that under the terms of the
		Agreement gives rise to any right of CGM to liquidate Contracts held in
		Customer’s Account or take other action to limit CGM’s credit
		exposure to Customer, Customer authorizes CGM to liquidate Customer’s OTC
		Energy Transactions for Customer’s account and risk by any commercially
		reasonable means, including without limitation through exchange of futures for
		swaps (“EFS”) transactions, exchange of futures for physicals
		(“EFP”) transactions or similar transactions that are not prohibited
		by Applicable Law.

	 

	 
		8.  This OTC Energy Supplement and the Agreement shall be
		construed and applied in a manner that gives maximum effect to the terms and
		conditions of both.  In the event of any inconsistency, the terms of this
		OTC Energy Supplement shall apply and shall be deemed to be an amendment to the
		Agreement.
	 

	 
		

	 

	 
		
 

	 

	 
		Page 16 of 16

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