Document:

Exhibit 10.1

STOCKHOLDERS' AGREEMENT 

          THIS STOCKHOLDERS' AGREEMENT (this "Agreement"),
dated as of January 19, 2001, among Ascent Energy Inc., a Delaware corporation
("Buyer"), and the holders of the shares of common stock, par value
$0.0001 per share, of Pontotoc Production, Inc., a Nevada corporation (the
"Company"), listed on the signature pages hereof (each a
"Stockholder"). 

          WHEREAS, in order to induce Buyer and Merger Sub to enter
into an Agreement and Plan of Merger, dated as of the date hereof, with Company
(the "Merger Agreement"), Buyer has requested that each Stockholder,
and each Stockholder has agreed to, enter into this Agreement with respect to
the number of shares of common stock of the Company set forth next to such
Stockholder's name on the signature pages hereof, plus any shares of common
stock of the Company acquired by such Stockholder after the date hereof (the
"Shares"). 

          NOW, THEREFORE, the parties hereto agree as follows: 

ARTICLE 1

VOTING AGREEMENT; AGREEMENT TO TENDER 

          Section 1.1.   
Voting Agreement. Each Stockholder hereby
agrees to vote all Shares that such Stockholder is entitled to vote at the time
of any vote to approve and adopt the Merger Agreement, the Merger and all
agreements related to the Merger and any actions related thereto at any meeting
of the stockholders of the Company, and at any adjournment thereof, at which the
Merger Agreement and other related agreements (or any amended version thereof),
or such other actions, are submitted for the consideration and vote of the
stockholders of the Company. Each Stockholder hereby agrees that he, she, or it
will not vote any Shares in favor of the approval of any (i) Acquisition
Proposal, (ii) reorganization, recapitalization, liquidation or winding up of
the Company or any other extraordinary transaction involving the Company, (iii)
corporate action the consummation of which would frustrate the purposes, or
prevent or delay the consummation, of the Offer, the Merger or any other
transactions contemplated by the Merger Agreement or (iv) other matter relating
to, or in connection with, any of the foregoing matters. 

          Section 1.2.    
Agreement to Tender. Each Stockholder
hereby agrees to tender, upon the request of Buyer (and agrees that it will not
withdraw), pursuant to and in accordance with the terms of the Offer, the
Shares. Within five business days after the commencement of the Offer, each
Stockholder shall (a) deliver to the depositary designated in the Offer (i) a
letter of transmittal with respect to the Shares complying with the terms of the
Offer, (ii) certificates representing the Shares and (iii) all other documents
or instruments required to be delivered pursuant to the terms of the Offer,
and/or (b) instruct its broker or such other person who is the holder of record
of any Shares beneficially owned by such Stockholder to tender such shares for
exchange in the Offer pursuant to the terms and conditions of the Offer.
           

ARTICLE 2

REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER

          Each Stockholder, severally and not jointly, represents and
warrants to Buyer that:
       
    
     Section 2.1.     Authorization. The execution, delivery
and performance by such Stockholder of this Agreement and the consummation by
such Stockholder of the transactions contemplated hereby are within the powers
of such Stockholder and have been duly authorized by all necessary action. This
Agreement constitutes a valid and binding Agreement of such Stockholder.

          Section 2.2.    
Non–Contravention. The execution,
delivery and performance by such Stockholder of this Agreement and, subject to
compliance with all applicable securities laws, the consummation of the
transactions contemplated hereby, do not and will not (i) violate any applicable
law, rule, regulation, judgment, injunction, order or decree, (ii) require any
consent or other action by any person under, constitute a default under, or give
rise to any right of termination, cancellation or acceleration or to a loss of
any benefit to which such Stockholder is entitled under any provision of any
agreement or other instrument binding on such Stockholder or (iii) result in the
imposition of any Encumbrance on any asset of such Stockholder.
      

          Section 2.3.    
Ownership of Shares. Such Stockholder is
the record and beneficial owner of the Shares, free and clear of any Encumbrance
and any other limitation or restriction (including any restriction on the right
to vote or otherwise dispose of the Shares, other than any such restriction that
has been waived with respect to this Agreement and the Merger Agreement and the
agreements and transactions contemplated hereby and thereby).
           

ARTICLE
3

REPRESENTATIONS AND WARRANTIES OF BUYER 

          Buyer represents and warrants to each Stockholder:

          Section 3.1.    
Corporate Authorization. The execution,
delivery and performance by Buyer of this Agreement and the consummation by
Buyer of the transactions contemplated hereby are within the corporate powers of
Buyer and have been duly authorized by all necessary corporate action. This
Agreement constitutes a valid and binding Agreement of Buyer.
           

ARTICLE 4

COVENANTS OF STOCKHOLDER

          Each Stockholder hereby covenants and agrees that:
           Section 4.1.    
No Proxies for or Encumbrances on Shares.
Except pursuant to the terms of this Agreement, such Stockholder shall not,
without the prior written consent of Buyer, directly or indirectly: (i) grant
any proxies or enter into any voting trust or other agreement or arrangement
with respect to the voting of any Shares with respect to any matter contemplated
by this Agreement or in a manner inconsistent with this Agreement or (ii)
acquire, sell, assign, transfer, encumber or otherwise dispose of, or enter into
any contract, option or other arrangement or understanding with respect to the
direct or indirect acquisition or sale, assignment, transfer, encumbrance or
other disposition of, any Shares during the term of this Agreement other than
pursuant to the Offer.

           Section 4.2.    
Appraisal Rights. Such Stockholder agrees
not to exercise any rights (including, without limitation, under Section 92A.380
of the General Corporation Law of the State of Nevada) to demand appraisal of
any Shares which may arise with respect to the Merger.
           

ARTICLE 5

MISCELLANEOUS

          Section 5.1.    
Further Assurances. Buyer and each
Stockholder will each execute and deliver, or cause to be executed and
delivered, all further documents and instruments and use all reasonable efforts
to take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable under applicable laws and regulations, to
consummate and make effective the transactions contemplated by this Agreement.
           Section 5.2.    
Amendments; Termination. Any provision of
this Agreement may be amended or waived if, but only if, such amendment or
waiver is in writing and is signed, in the case of an amendment, by each party
to this Agreement or in the case of a waiver, by the party against whom the
waiver is to be effective. This Agreement shall terminate upon the termination
of the Merger Agreement in accordance with its terms.

           Section 5.3.    
Expenses. All costs and expenses incurred
in connection with this Agreement shall be paid by the party incurring such cost
or expense; provided, however, all costs and expenses incurred by the
Stockholders shall be borne and paid by the Company.

           Section 5.4.    
Successors and Assigns. The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns; provided that no party may
assign, delegate or otherwise transfer any of its rights or obligations under
this Agreement without the consent of the other parties hereto, except that
Buyer may transfer or assign its rights and obligations to any affiliate of
Buyer.

           Section 5.5.    
Governing Law. Except to the extent the
subject matter of this Agreement is subject to the statutory law of the State of
Nevada which requires that such laws shall govern, this Agreement shall
construed in accordance with and governed by the laws of the State of Delaware.

           Section 5.6.    
Counterparts; Effectiveness. This
Agreement may be signed in any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument. This Agreement shall become effective when each party
hereto shall have received counterparts hereof signed by all of the other
parties hereto.

           Section 5.7.    
Severability. If any term, provision or
covenant of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the remainder of the terms,
provisions and covenants of this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.

           Section 5.8.    
Specific Performance. The parties hereto
agree that irreparable damage would occur in the event any provision of this
Agreement is not performed in accordance with the terms hereof and that the
parties shall be entitled to specific performance of the terms hereof in
addition to any other remedy to which they are entitled at law or in equity.

           Section 5.9.    
Capitalized Terms. Capitalized terms used
but not defined herein shall have the respective meanings set forth in the
Merger Agreement.

           IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.

BUYER:

ASCENT ENERGY INC.

 

By:            
/s/ Jeffrey
Clarke                    

                   
Jeff Clarke

                   
President

 

                                    
                                    STOCKHOLDERS:                               
                                          
               
                                    Shares of common

                                       

                                                                        
                                          
                                         
                                    stock of the Company

                                       

                                                                        
                                          
                                         
                                    owned by Stockholder:

 

               
/s/ James Robson,
Jr.               
                                         
                              
569,497

James "Robby" Robson, Jr.

 

              
/s/ Todd
Robson                       
                                         
                              
570,051

Todd Robson

 

            /s/
James Robson,
Sr.                   
                                         
                              
441,313

James Robson, Sr.

 

          /s/ Lyle P.
Phillips                           
                                         
                              
299,000

Lyle P. Phillips

 

          /s/ Brian K.
Gourley                       
                                         
                                
58,671

Brian K. Gourley

 

         /s/ Timothy A. Jurek                       
                                         
                                
25,000

Timothy A. JurekExhibit 10.2
    
  

     

     

    
    LEASE AGREEMENT

    

  

  By and Between

  PONTOTOC GATHERING, L.L.C.

  "Lessee"

  AND

  ENERFIN RESOURCES I LIMITED PARTNERSHIP

  "Lessor"

  DATED: July 1, 2000

    
   
  

    
  
    
    
    
    LEASE AGREEMENT
    

    
  

        This Lease Agreement
("Agreement") is entered into effective as of July 1, 2000 by and
between Pontotoc Gathering, L.L.C., ("Lessee" or "PGL"),
having a place of business at 1345 East 29th Street, Tulsa, Oklahoma 74114, and
Enerfin Resources I Limited Partnership ("Lessor" or "Enerfin"),
having a place of business at Three Riverway, Suite 1200, Houston, Texas 77056;
(Lessor and Lessee being collectively referred to hereafter as the
"Parties").

  
    
    
    SECTION 1. RECITALS

    

    
    

  

  	
  
    1.1   

      	
  
       

      	
  
     PGL is in
  partnership with Pontotoc Production Company, ("PPC") and PPC plans
  to   develop natural gas from shallow reservoirs in northern
  Pontotoc, southern Seminole and southeastern Potawatomie Counties, Oklahoma;
  and,

      
	

1.2    

      	

    

      	

Enerfin
owns and operates a natural gas pipeline gathering system, the ("Byng")
System which is more fully described in Exhibit "A" attached hereto
and made a part hereof; and,

 

      
	

1.3    

      	

    

      	

The Byng
System is located in the vicinity in which PPC plans to develop natural gas
production; and,

 

      
	

1.4    

      	

    

      	

PGL, as
Lessee, and Enerfin, as Lessor, desire to enter into a Lease Agreement under the
terms and conditions provided herein. 

      

  
    
    
    SECTION 2. SCOPE AND USAGE

    

    
  

  	

    2.1    

      	

    
       
 

      	

    Lessor
hereby leases to Lessee the right to use the Byng System for the purpose of
gathering and transporting natural gas developed by PPC or PGL in areas near the
Byng System subject to and in accordance with the terms and conditions of this
Agreement.

      
	

    2.2   

      	

       

      	

    Lessee
shall have full use of the capacity of the Byng System, provided that, Lessor
shall retain the right to use any capacity of the Byng System not used by
Lessee. Lessor shall notify Lessee at least thirty (30) days prior to Lessor's
intended use of such available capacity. Lessee shall cooperate with Lessor in
regards to the use of such capacity and shall transport such gas through the
Byng System to be either delivered to Lessee's delivery point for the account of
Lessor, or directly to Lessor at a mutually acceptable custody transfer point.
Gas shall be made available to Lessor through this custody transfer point at the
prevailing System pressure. All operating costs and expenses, including
maintenance and repairs, related to the use of such capacity by Lessor shall be
borne solely by Lessor and any operating, maintenance or repair costs incurred
by Lessee related to the use of such capacity by Lessor, shall be promptly
reimbursed to Lessee upon receipt by Lessor of an invoice of the costs incurred
by Lessee including reasonable support or documentation of such costs.

      

  
    
    
    SECTION 3. OPERATIONS

    

    
  

	

    3.1   

    	

       

    	

    Lessee
shall assume on the effective date of this Agreement, at its sole risk and
expense, the operations of the Byng System in a manner consistent with prudent
operating procedures and in accordance with generally accepted industry
standards, laws and regulations. Lessee shall operate the Byng System in Low
Pressure natural gas service. For purposes of this Agreement, Low Pressure is
defined as that pressure at which a pipeline may be operated at under safe
operating conditions, but which pressure in no event will exceed the maximum
allowable operating pressure ("MAOP") of such pipeline.
Notwithstanding the foregoing, Lessee will not allow the operating pressure of
any of the pipelines of the Byng System to
exceed 250 psig.

    
	

3.2    

    	

    

    	

Lessee
will perform, at its sole risk and expense, all necessary or appropriate
activities concerning the operation, inspection, maintenance, corrosion
prevention (including maintaining rectifiers for cathodic protection) and
repairs of the Byng System. All such repairs, maintenance, upgrades or
improvements performed on the Byng System by Lessee shall remain the property of
Lessor. 

    
	

3.3    

    	

    

    	

Lessee
shall comply, at its sole risk and expense, with all of the terms and conditions
of the Easements covering the Byng System. Lessor shall provide Lessee with a
copy of the Easements of the Byng System and Lessee shall maintain files
relative to these Easements during the term of this Agreement including
amendments, correspondence and related information and documents. These Easement
files shall remain the property of Lessor and upon termination of this
Agreement, Lessee shall turn such files and documents over to Lessor. 

    
	

3.4    

    	

    

    	

Lessee
shall be responsible, at its sole risk and expense, for line locates and for
complying with the requirements of the "Okie 1–Call" system (or other
similar applicable programs) with respect to the Byng System during the term of
this Agreement. Prior to commencing operation of any
pipeline segment(s) of the Byng System for
natural gas service as contemplated herein, Lessee shall install appropriate
line markers in Lessee's name upon such pipeline segment(s) that Lessee places
in natural gas service.

    
	
 3.5    

    	
     

    	
 Lessee
will be responsible, at its sole risk and expense, for procuring any necessary
governmental operating or right–of–way permits, documents, approvals, or
authorities relating to the use, operation, maintenance, or shutdown of the Byng
System. 

    
	
 3.6    

    	
     

    	
 Lessee
understands that the property leased pursuant to this Agreement does not include
compressors, pumps, meters, and/or other equipment which may be necessary in the
course of Lessee's operation and use of such
property. Lessee will furnish and install, at its sole risk and expense, any
equipment or facilities required in the conduct of Lessee's permitted operations
of the property. Any equipment or facilities so installed shall meet the
operating requirements previously outlined in this Agreement and shall remain
the property of Lessee.

    

  
  SECTION 4.

  
  ALTERATIONS, CONSTRUCTION AND SURRENDER
  OF THE BYNG SYSTEM

  
  

  	

  4.1   

      	

     

      	

  Lessee
will not remove any of the pipelines of the Byng System or make or allow to be
made any material alterations or modifications to the Byng System, or any
part thereof, without first obtaining written approval from Lessor of
such activity or alteration. Lessee may, however, make connections or additions
to the Byng System without obtaining the approval of Lessor; provided, however,
that Lessee shall promptly notify Lessor in writing of all lease or well
connections that are made to the Byng System. Any connections or additions made
to the Byng System shall remain the property of Lessee. If Lessor approves of a
material alteration to be made by Lessee of the property, Lessor shall have the
right to have a representative present during any time that such material
alterations or modifications on or to the Byng System are made. Approvals or
inspections by Lessor of such activities shall have no effect on, and shall not
operate as a waiver by Lessor of, any of Lessee's duties and obligations under
this Agreement.

      
	

4.2   
  

      	

   
  

      	

At the
expiration or earlier termination of this Agreement, Lessee shall, at its sole
risk and expense, remove within three months, all of its equipment, fixtures,
meters, connections, and other personal property connected to or installed on
the Byng System (except as otherwise agreed to in writing by the Parties) and
repair all damage done by or in connection with the installation or removal of
such equipment, fixtures, connections, meters, and property, and shutdown and
surrender the Byng System to Lessor in as good a condition as it was at the
beginning of the term of this Agreement, normal and reasonable wear from
authorized use excepted, with the pipeline pigged dry and purged of any natural
gas and related liquids and substances to the extent that the pipeline is
reasonably able to be purged or pigged.
  

      

  
  
  SECTION 5. LEASE
  RENTAL FEES

  
  

  	

  5.1   

      	

     

      	

  Lessee
agrees to pay to Lessor each month as rental for the Byng System, a
monthly Lease Rental Fee that shall be the greater of: (i.) Four Percent (4%) of
the Gross Sales Revenue for the sale of natural gas received by Lessee
(or PPC or the working interest owners of the gas connected to the Byng System);
or (ii.) Five Hundred Dollars ($500.00). The Gross Sales Revenue shall be the
gross dollar amount (before any deductions) received by Lessee (or PPC or the
working interest owners of the gas) for the sale of the gas which is connected
to the Byng System by Lessee, except for any gas which may be sold by Lessee on
the behalf of Lessor. The Gross Sales Revenue shall be calculated as the value
received FOB the custody transfer point between the Byng System and any other
third party pipeline system (such as Noram pipeline) and shall not be reduced
for any fees, costs or expenses, including but not limited to, marketing fees,
incurred to deliver such gas to a third party market. The Gross Sales Revenue
amount shall be calculated using methods that are reasonably acceptable to the
Parties and that are in accordance with any applicable industry standards, and
shall be evidenced by documentation reasonably acceptable to Lessor.

      
	

5.2   

      	

   

      	

Each
month, Lessee shall provide Lessor with a statement showing the total gas volume
in Mcfs and MMBtus connected to the Byng System and the total volume in MMBtus
and gross sales price per MMBtu received by Lessee (PPC or the working interest
owners of the gas) for the sale of such gas to its market(s). Lessor (and/or its
duly authorized representatives) shall have the right, at any reasonable time
and from time to time, to audit the records of Lessee
and its affiliates that are reasonably needed in order to calculate and/or
confirm the amounts that are due and owing under this Agreement. Lessee agrees
to cooperate in furnishing to Lessor applicable records, documents, and other
data in connection with such audits.

      
	
5.3    

      	
    

      	
Lessee
agrees to pay the Lease Rental Fee for each month within thirty (30) days after
the end of such month. If any such payment is
not paid within fifteen (15) days of the due date, then the amount due shall
bear interest from such due date until payment is received, calculated at an
annual rate equivalent to the lesser of (i.) 16%;
or (ii.) the maximum interest rate which may be lawfully charged under
applicable law.

      

  
        
      
  
SECTION 6. GAS PROCESSING
 
      

    
  

  	
6.1     

      	
      

      	
Lessee
or PPC will not process natural gas, for the removal of natural
gas liquids, that is connected to the Byng System by Lessee or PPC. If Lessee or PPC develops natural gas that
requires processing, Lessee will deliver such gas, if reasonably
practical and feasible, to Lessor under a mutually agreed to purchase or
processing arrangement. If the
parties are not able to reach a mutually satisfactory arrangement for such
processable gas, then Lessor shall retain the right of first refusal of
processing such gas by having the right to match any bona fide third party offer
received by Lessee.
        

      

  
    
    
    SECTION 7. TERM
  
    

    
    

  

  	
  
    7.1   

      	
  
       

      	
  
    This
  Agreement will be effective on July 1, 2000 and shall remain in full force and effect for a primary term of
  three (3) years, with annual one (1) year renewals thereafter at the sole
  option of Lessee unless terminated by Lessee at least ninety (90) days prior
  to the beginning of any annual renewal period (which is July 1); provided
  that, this Agreement may be terminated by either Lessee or Lessor with at
  least ninety (90) days notice prior to any annual renewal period beginning
  July 1, 2015. The termination of this
  Agreement shall not affect the Parties' duties and obligations incurred
  pursuant to this Agreement. (The Parties recognize and acknowledge that the
  term of this Agreement is also subject to possible earlier termination
  pursuant to the provisions contained herein, including, without limitation,
  Section 9.1 of this Agreement.)
        

      

  
    
    
    SECTION 8. INSPECTION, NO REPRESENTATIONS
 
    

    
    

  

  	
  
    8.1     

      	
  
    
          

      	
  
    Lessee
  acknowledges that it is entering into this Agreement without relying upon any
  representations by Lessor concerning the condition (physical, title, easements
  and rights–of–way, environmental, or otherwise) of the
  Byng System or the fitness of the property or pipelines for any particular
  purpose; rather, Lessee acknowledges that it is entering into this Agreement
  relying solely upon any investigation of the Byng System it may have
  undertaken.
 
  

      
	

8.2    

      	

    

      	

LESSOR
DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE BYNG SYSTEM,
INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF TITLE, WARRANTY OF
MERCHANTABILITY, OR WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, WHETHER
ARISING BY OPERATION OF LAW OR OTHERWISE. LESSEE ACKNOWLEDGES THAT IT IS LEASING
THE BYNG SYSTEM IN AN "AS IS, WHERE IS" CONDITION, WITH ALL FAULTS OR
DEFECTS, BOTH PATENT AND LATENT. LESSEE RELEASES LESSOR FROM ANY AND ALL
LIABILITY FOR LATENT OR PATENT FAULTS OR DEFECTS IN, OR RELATED TO, THE BYNG
SYSTEM, REGARDLESS OF HOW SUCH FAULTS OR DEFECTS WERE CAUSED OR CREATED (BY
LESSOR'S NEGLIGENCE, ACTIONS, OMISSIONS, OR FAULT, OR OTHERWISE). 

      

  
    
    
    SECTION 9. DAMAGES AND LINE CHANGES OR RELOCATIONS
 
    

    
  

  	

    9.1     

      	

    
          

      	

    Lessee shall be responsible for repairing, at
    its expense and to the reasonable satisfaction of Lessor, any damage that
    occurs to or is related to the Byng System during the term of this Agreement
    arising from the conduct of Lessee,
or its agents, representatives, contractors, or employees. Lessee shall also be
responsible, at its expense, for raising, lowering, relocating, or otherwise
adjusting the pipelines of the Byng System
to the extent required by the terms of the
Easements, required by law, required to accommodate public improvements, or
required by landowners; provided, however, that if the
cost to Lessee for raising, lowering, relocating, or otherwise adjusting the
pipeline would (based upon reasonable cost estimates by Lessee) exceed $20,000
for any one occurrence or $200,000 in the aggregate during the term of this
Agreement, Lessee shall have the right to terminate this Agreement in its
entirety (i.e., with respect to the entire Byng System) or at its election, with
respect to that portion of the pipeline system, effective sixty (60) days after
written notification to Lessor, and Lessee shall be relieved from further
obligations other than those obligations relating to the shut down of the
property as set forth in Section 4.2 and those obligations as set forth herein
relating to incidents or events (personal injuries, property damage, releases
from the pipeline, etc.) that occurred during Lessee's possession or operation
of the Byng System prior to such termination.
        

      

  
    
    
    SECTION 10. INDEMNIFICATION 

    
    

  

  	
  
    10.1     

      	
  
    
          

      	
  
    To
  the fullest extent permitted by law, Lessee AGREES TO INDEMNIFY, DEFEND, AND
  HOLD Lessor, and its partners and affiliates, and their officers, employees,
  and agents (collectively referred to for purposes of this Section as the
  "Indemnitees"), harmless from and against all liability, loss,
  claims, strict liability claims, demands, lawsuits, judgments, orders,
  penalties, expenses (including but not limited to reasonable attorneys' fees),
  costs, environmental clean–up costs, and causes of action
  asserted by any person or entity (including but not limited to the employees
  of either Lessor or Lessee) for personal
  injury or death, for compliance with environmental laws, regulations, orders,
  or guidelines, or for loss or damage to property or the environment, arising
  from or relating to: (i.) the possession, use, operation, maintenance or
  repair of the Byng System by Lessee, or (ii.) any other activities of any kind
  or character of Lessee or its contractors in connection with or pursuant to
  this Agreement. It is expressly agreed that Lessee's obligations to indemnify,
  defend, and hold Indemnitees harmless pursuant to the preceding sentence shall
  include, but not be limited to, liability, loss, claims, etc. that result from
  the actions or omissions of Indemnitees, or its predecessor's in interest,
  in the design or construction of the property, or in the operation,
  maintenance or repair of the property. 

      
	

10.2   

      	

   

      	

To the
fullest extent permitted by law, Lessor agrees to INDEMNIFY, DEFEND, AND HOLD
LESSEE, and its partners and affiliates, and their officers, employees, and
agents harmless from and against any and all liability resulting from Lessor's
negligence or willful misconduct with respect to the Byng System that occurs
after the effective date.

      

  
    
    
    SECTION 11. INSURANCE 

    
  

  	

  11.1   

        

      	

     

        

      	

  Lessee
shall maintain at its sole cost, the following types of insurance during the
term of this Agreement:

        

      

  
    	
    
    
    a.    

        	
    
    
    Worker's Compensation and
    Employer's Liability Insurance, as prescribed by applicable law, with such,
    insurance containing a waiver of subrogation against Lessor. 

        
	
    
    
    b.    

        	
    
    
    Commercial General Liability
    Insurance, covering the property and any related facilities or equipment,
    with combined single limits for bodily injury and property damage of
    $1,000,000 per occurrence and in the aggregate. The insurance shall include
    contractual liability coverage specifically insuring the indemnity agreement
    of Lessee contained herein, and shall cover the entire property leased
    herein. The insurance also shall include the following endorsement:
    Additional Insured Designated Person or Organization (CG 20 26 11 85) naming
    Lessor as an additional insured with respect to liability arising out of
    Lessee's actions or activities under this Agreement. 

        
	
    
    
    c.    

        	
    
    
    Automobile Liability Insurance
    covering all owned, non–owned, and hired vehicles with a combined single
    limit for bodily injury and property damage of $1,000,000
    per accident. This insurance shall include contractual liability coverage
    specifically insuring the indemnity agreement of Lessee
    contained herein.

        

    

  

  	
   11.2    

      	
       

      	
  
 
    Each policy
  of insurance secured and maintained by Lessee
  pursuant to this Section: (i.) shall be issued by insurance companies
  acceptable to Lessor and in a form satisfactory to Lessor, (ii.) shall provide
  that each policy shall be primary to and not in excess of or contributory with
  any insurance available to Lessor, and (iii.) shall be endorsed to provide
  that Lessor shall be given not less than thirty (30) days prior written notice
  of any cancellation or material change in coverage. The insurance limits
  specified above may be satisfied with a combination of primary and
  Umbrella/Excess Insurance.
 

      
	

11.3    

      	

    

      	

Prior to
the commencement of this Agreement, and thereafter no later than fifteen (15)
days prior to the expiration date of the policies evidenced thereon, Lessee
shall deliver or cause to be delivered to Lessor certificates of insurance
evidencing the required coverage. If requested by Lessor, Lessee shall provide
certified copies of all such insurance policies to Lessor. 

      

  
    
    
 
    SECTION 12. COMPLIANCE WITH LAWS AND TAXES
 

    
  

  	
 12.1     

      	
        

      	

 
    During
the term of this Agreement, and during any time thereafter that Lessee is on the
property for purposes of performance under
this Agreement, or other related reasons, Lessee, and its employees,
contractors, and agents, shall comply, at Lessee's sole risk and expense, with
all industry standards and with all laws, orders, statutes, decrees, directives,
ordinances, and regulations, or other similar requirements of any
federal, state, or local government, court, or authority that are applicable
to or arise out of Lessee's operation, use,
maintenance, repair or shutdown of the
property and pipelines. Lessee agrees to promptly remedy in accordance with
laws, regulations, and governmental directives any condition relating to the
property that is created during the term of this
Agreement and which is not in compliance with any laws, regulations, orders or
guidelines of any regulatory body asserting
jurisdiction.
 

      
	

12.2   

      	

   

      	

Lessee
shall pay all ad valorem taxes that may be levied on or assessed against the
Byng System during the term of this Agreement. Lessee shall also pay all taxes,
assessments, or charges that may be assessed by reason of the lease, operation
or use of the Byng System hereunder, including, but not limited to, any gross
receipts tax, use taxes, use fees, or sales taxes imposed by any governmental
authority, including any interest or penalties relating thereto.

      

  
    
    
 
    SECTION 13. OPTION TO PARTICIPATE IN WELLS/PROSPECTS
 

    
  

  	
 13.1    

      	
     

      	
 Simultaneously with the execution of this Agreement, Lessee, Lessor and PPC are
entering into that certain Agreement for Optional Well Participation Rights. The
execution of such separate agreement by Lessee and PPC is part of the
consideration received by Lessor for the rights it is granting to Lessee under
this Agreement. 

      

  
    
    
 
    SECTION 14. MISCELLANEOUS
 

    
  

  	
 14.1    

      	
     

      	
 Lessor
shall have the right to enter upon the property of the Byng System to inspect
such property or related equipment or to enforce or carry out any provision of
this Agreement. 

      
	
 14.2    

      	
     

      	
 This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective successors and assigns. Lessee shall not assign this Agreement
in whole or in part nor sublet all or any part of the Byng System nor permit the
use of any part of the property or pipelines by any other person or entity
without the prior written consent of Lessor. 

      
	
 14.3    

      	
     

      	
 All
notices required under this Agreement shall be deemed made when made in writing
and personally delivered, received by overnight mail, received by telecopy, or
received by certified or registered mail, return receipt requested, to the
following addresses: 

      

  
    
      
    
 
    To Lessee:

    Pontotoc Gathering, L.L.C.

    1345 E. 29th Street

    Tulsa, OK 74114

    Phone #: 918.742.5835

    Fax #: 918.743.2645

    Attention: Mr. Tim Jurek
 

    
 
    To Lessor:

    Enerfin Resources I Limited Partnership

    Three Riverway  Suite 1200

    Houston, TX 77056

    Phone #: 713.888.8600

    Fax #: 713.888.8629

    Attention: Contract Administration
 

    
 
    The address to which written notice is to be sent may be
    changed by written notice as described in this Section.
 

      

    

  

  	
 14.4    

      	
     

      	
 The occurrence of one or more
of the following events constitutes a default under this Agreement, with the
non–defaulting party having in such situation the right to immediately terminate
this Agreement upon written notice to the defaulting party, with termination to
be effective as of the date specified in the notice: (a) Failure to observe or
perform any covenant, agreement, condition or provision of this Agreement if
such failure shall continue for thirty (30) days after written notice to the
defaulting party of such failure, except that if, because of the nature of the
default, such default cannot be cured within such thirty (30) day period, such
period shall be extended provided that the defaulting party commences to cure
such default within such thirty (30) day period and proceeds diligently
thereafter to effectuate such cure; or (b) Either party has a petition in
bankruptcy filed by or against it, has a receiver appointed for it, becomes
insolvent, or makes a general assignment for the benefit of creditors. In the
event of default by Lessee, Lessor shall have the right, in addition to its
other rights under this Agreement, to immediately re–enter the property. 

      
	
 14.5    

      	
     

      	
 This Agreement shall be
construed in accordance with the laws of the state of Oklahoma. 

      
	
 14.6    

      	
     

      	
 This Agreement contains the
entire agreement of the parties with respect to the subject matter thereof, and
supersedes all prior and contemporaneous agreements, whether written or oral,
between the parties with respect to the lease of the property. This Agreement
may not be modified except by an instrument signed by both parties. 

      

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

 
    PONTOTOC GATHERING, L.L.C.
 

  
 
    By:             
     /s/ Timothy A. Jurek       

 

 
    Name:             
Timothy A. Jurek          

 

 
    Title:                   
President              
   
 

  ENERFIN RESOURCES I LIMITED PARTNERSHIP

     
  By:     Enerfin I Corporation

     

               Managing General Partner

By:       
        
/s/ Dave C. Cremer    

Name:              Dave C. Cremer     
 
  

Title:             
   Vice President

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