Document:

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                                                                 EXHIBIT 10(n)

                        BASE CONTRACT FOR SHORT-TERM
                      SALE AND PURCHASE OF NATURAL GAS

This Base Contract is entered into as of the following date: January 1,
2002. The parties to this Base Contract are the following:

M&B Gas Services, Inc.             and  Delta Natural Gas Company, Inc.
P.O. Box 377                            3617 Lexington Road
Frazeysburg, Ohio 43822                 Winchester, Kentucky 40391
Attn: Brian Jonard                      Attn: Brian S. Ramsey
Phone: (740) 828-2892                   Phone: (859) 744-6171
Fax: (740) 828-3660                     Fax: (859) 744-3623
Federal Tax ID Number: 31-0925705       Federal Tax ID Number: 61-0458329
Duns #                                  Duns # 00-77-9408

Invoices and Payments:                  Delta Natural Gas Company, Inc.
M&B Gas Services, Inc.                  Attn:  Brian S. Ramsey
Attn: Gas Accounting                    3617 Lexington, Road
P.O. Box 377                            Winchester, Kentucky  40391
Frazeysburg, Ohio 43822                 Phone: (859) 744-6171
Phone: (740) 828-2892                   Fax: (859) 744-3623
Fax: (740) 828-3660

Wire Transfer Payments:
Summit Bank Hackensack ABA #021202162
Credit To: Clearfield Energy, Inc.
A/C #496-08311

This Base Contract incorporates by references for all purposes the General
Terms and Conditions for Short-Term Sale and Purchase of Natural Gas
published by the Gas Industry Standards Board. The parties hereby agree to
the following provisions offered in said General Terms and Conditions
(SELECT ONLY ONE FROM EACH BOX, BUT SEE "NOTE" RELATING TO SECTION 2.24.):

<TABLE>
<C>                                                  <C>
SECTION 1.2                 X  Oral                  SECTION 6.         X  Buyer Pays At and After Delivery Point
                           ---                                         ---
Transaction Procedure          Written               Taxes                 Seller Pays Before and At Delivery Point
                           ---                                         ---

SECTION 2.4       X  2 Business Days after receipt   SECTION 7.2           25th date of Month following Month of
                 ---                                                   ---
Confirm Deadline         (default)                   Payment Date            Month of delivery
                     Business Days after receipt
                 ---

SECTION 2.5                 X Seller                 SECTION 7.2        X  Wire Transfer (WT)
                           ---                                         ---
Confirming Party               Buyer                 Method of Payment     Automated Clearinghouse (ACH)
                           ---                                         ---
                                                                           Check
                                                                       ---

SECTION 3.2                 X  Cover Standard
                           ---                                         ---
Performance Obl.               Spot Price Standard   SECTION 13.5
                           ---
                                                     CHOICE OF LAW: Ohio
</TABLE>

NOTE:  THE FOLLOWING SPOT PRICE PUBLICATION APPLIES TO
       BOTH OF THE IMMEDIATELY PRECEDING STANDARDS AND
       MUST BE FILLED IN AFTER A STANDARD IS SELECTED.

SECTION 2.24
Spot Price Publication: Gas Daily                         SPECIAL PROVISIONS:
                                                     ----

IN WITNESS WHEREOF, the parties hereto have executed this Base Contract in
duplicate.

M&B Gas Services, Inc.                   Delta Natural Gas Company, Inc.

By:/s/ BRIAN R. JONARD                   By: /s/ GEORGE S. BILLINGS
   -------------------                       ----------------------
Name:  Brian R. Jonard                   Name:  George S. Billings
Title:  President                        Title:  Manager - Gas Supply

DISCLAIMER: The purposes of this Contract are to facilitate trade, avoid
misunderstandings and make more definite the terms of contracts of purchase
and sale of natural gas. This Contract is intended for interruptible
transactions or Firm transactions of one month or less and may not be
suitable for Firm transactions of longer than one month. Further, GISB does
not mandate the use of this Contract by any part. GISB DISCLAIMS AND
EXCLUDES AND ANY USER OF THIS CONTRACT ACKNOWLEDGES AND AGREES TO GISB'S
DISCLAIMER OF, ANY AND ALL WARRANTIES, CONDITIONS OR REPRESENTATIONS,
EXPRESS OR IMPLIED, ORAL OR WRITTEN, WITH RESPECT TO THIS CONTRACT OR ANY
PART THEREOF, INCLUDING ANY AND ALL IMPLIED WARRANTIES OR CONDITIONS OF
TITLE, NON-INFRINGEMENT, MERCHANTABILITY, OR FITNESS OR SUITABILITY FOR ANY
PARTICULAR PURPOSE (WHETHER OR NOT GISB KNOWS, HAS REASON TO KNOW, HAS BEEN
ADVIED, OR IS OTHERWISE IN FACT AWARE OF ANY SUCH PURPOSE), WHETHER ALLEGED
TO ARISE BY LAW, BY REASON OF CUSTOM OR USAGE IN THE TRADE, OR BY COURSE OF
DEALING. EACH USER OF THIS CONTRACT ALSO AGREES THAT UNDER NO CIRCUMSTANCES
WILL GISB BE LIABLE FOR ANY DIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE
OR CONSEQUENTIAL DAMAGES ARISING OUT OF ANY USE OF THIS CONTRACT.

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                        GENERAL TERMS AND CONDITIONS
                        BASE CONTRACT FOR SHORT-TERM
                      SALE AND PURCHASE OF NATURAL GAS

SECTION 1.  PURPOSE AND PROCEDURES

1.1 These General Terms and Conditions are intended to facilitate purchase
and sale transactions of Gas on a Firm or Interruptible basis. "Buyer"
refers to the party receiving Gas and "Seller" refers to the party
delivering Gas.

THE PARTIES HAVE SELECTED EITHER THE "ORAL" VERSION OR THE "WRITTEN" VERSION
OF TRANSACTION PROCEDURES AS INDICATED ON THE BASE CONTRACT.

ORAL TRANSACTION PROCEDURE:

1.2 The parties will use the following Transaction Confirmation procedure.
Any Gas purchase and sale transaction may be effectuated in an EDI
transmission or telephone conversation with the offer and acceptance
constituting the agreement of the parties. The parties shall be legally
bound from the time they so agree to transaction terms and may each rely
thereon. Any such transaction shall be considered a "writing" and to have
been "signed." Notwithstanding the foregoing sentence, the parties agree and
Confirming Party shall, and the other party may, confirm a telephonic
transaction by sending the other party a Transaction Confirmation by
facsimile, EDI or mutually agreeable electronic means. Confirming Party
adopts its confirming letterhead, or the like, as its signature on any
Transaction Confirmation as the identification and authentication of
Confirming Party.

WRITTEN TRANSACTION PROCEDURE:

1.2 The parties will use the following Transaction Confirmation procedure:
Should the parties come to an agreement regarding a Gas purchase and sale
transaction for a particular Delivery Period, the Confirming Party shall,
and the other party may, record that agreement on a Transaction Confirmation
and communicate such Transaction Confirmation by facsimile, EDI or mutually
agreeable electronic means, to the other party by the close of the Business
Day following the date of agreement. The parties acknowledge that their
agreement will not be binding until the exchange of non-conflicting
Transaction Confirmation or the passage of the Confirm Deadline without
objection from the receiving party, as provided in Section 1.3.

1.3 If a sending party's Transaction Confirmation is materially different
from the receiving party's understanding of the agreement referred to in
Section 1.2, such receiving party shall notify the sending party via
facsimile by the Confirm Deadline, unless such receiving party has
previously sent a Transaction Confirmation to the sending party. The failure
of the receiving party to so notify the second party in writing by the
Confirm Deadline constitutes the receiving party's agreement to the terms of
the transaction described in the sending party's Transaction Confirmation.
If there are any material differences between timely sent Transaction
Confirmations governing the same transaction, then neither Transaction
Confirmation shall be binding until or unless such differences are resolved
including the use of any evidence that clearly resolves the differences in
the Transaction Confirmations. The entire agreement between the parties
shall be those provisions contained in both the Base Contract and any
effective Transaction Confirmation. In the event of a conflict among the
terms of (i) a Transaction Confirmation, (ii) the Base Contract, and (iii)
these General Terms and Conditions, the terms of the documents shall govern
in the priority listed in this sentence.

SECTION 2.  DEFINITIONS

2.1 "Base Contract" shall mean a contract executed by the parties that
incorporates these General Terms and Conditions by reference; that specifies
the agreed selections of provisions contained herein; and that sets forth
other information required herein.

2.2 "British thermal unit" or "Btu" shall have the meaning ascribed to it by
the Receiving Transporter.

2.3 "Business Day" shall mean any day except Saturday, Sunday or Federal
Reserve Bank holidays.

2.4 "Confirm Deadline" shall mean 5:00 p.m. in the receiving party's time
zone on the second Business Day following the Day a Transaction Confirmation
is received, or if applicable, on the Business Day agreed to by the parties
in the Base Contract; provided, if the Transaction Confirmation is time
stamped after 5:00 p.m. in the receiving party's time zone, it shall be
deemed received at the opening of the next Business Day.

2.5 "Confirming Party" shall mean the party designated in the Base Contract
to prepare and forward Transaction Confirmations to the other party.

2.6 "Contract" shall mean the legally-binding relationship established by
(i) the Base Contract and (i) the provisions contained in any effective
Transaction Confirmation.

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2.7 "Contract Price" shall mean the amount expressed in U.S. Dollars per
MMBtu, as evidenced by the Contract Price on the Transaction Confirmation.

2.8 "Contract Quantity" shall mean the quantity of Gas to be delivered and
taken as set forth in the Transaction Confirmation.

2.9 "Cover Standard", if applicable, shall mean that if there is an
unexcused failure to take over or deliver any quantity of Gas pursuant to
this Contract, then the non-defaulting party shall use commercially
reasonable efforts to obtain Gas or alternate fuels, or sell Gas, at a price
reasonable for the delivery or production area, as applicable, consistent
with: the amount of notice provided by the defaulting party; the immediacy
of the Buyer's Gas consumption needs or Seller's Gas sales requirements, as
applicable; the quantities involved; and the anticipated length of failure
by the defaulting party.

2.10. "Day" shall mean a period of 24 consecutive hours, coextensive with a
"day" as defined by the Receiving Transporter in a particular transaction.

2.11 "Delivery Period" shall be the period during which deliveries are to be
made as set forth in the Transaction Confirmation.

2.12 "Delivery Point(s)" shall mean such point(s) as are mutually agreed
upon between Seller and Buyer as set forth in the Transaction Confirmation.

2.13 "EDI" shall mean an electronic data interchange pursuant to an
agreement entered into by the parties, specifically relating to the
communication of Transaction Confirmations under this Contract.

2.14 "EFP" shall mean the purchase, sale or exchange of natural Gas as the
"physical" side of an exchange for physical transaction involving gas
futures contracts. EFP shall incorporate the meaning and remedies of "Firm."

2.15 "Firm" shall mean that either party may interrupt its performance
without liability only to the extent that such performance is prevented for
reasons of Force Majeure; provided, however, that during Force Majeure
interruptions, the party invoking Force Majeure may be responsible for any
Imbalance Charges as set forth in Section 4.3. related to its interruption
after the nomination is made to the Transporter and until the change in
deliveries and/or receipts is confirmed by the Transporter.

2.16 "Gas" shall mean any mixture of hydrocarbons and non-combustible gases
in a gaseous state consisting primarily of methane.

2.17 "Imbalance Charges" shall mean any fees, penalties, costs or charges
(in cash or in kind) assessed by a Transporter for failure to satisfy the
Transporter's balance and/or nomination requirements.

2.18 "Interruptible" shall mean that either party may interrupt its
performance at any time for any reason, whether or not caused by an event of
Force Majeure, with no liability, except such interrupting party may be
responsible for any Imbalance Charges as set forth in Section 4.3, related
to its interruption after the nomination is made to the Transporter and
until the change in deliveries and/or receipts is confirmed by Transporter.

2.19 "MMBtu" shall mean one million British thermal units which is
equivalent to one dekatherm.

2.20 "Month" shall mean the period beginning on the first Day of the
calendar month and ending immediately prior to the commencement of the first
Day of the next calendar month.

2.21 "Payment Date" shall mean a date, selected by the parties in the Base
Contract, on or before which payment is due Seller for Gas received by Buyer
in the previous Month.

2.22 "Receiving Transporter" shall mean the Transporter receiving Gas at a
Delivery Point, or absent such receiving Transporter, the Transporter
delivering Gas at a Delivery Point.

2.23 "Scheduled Gas" shall mean the quantity of Gas confirmed by
Transporter(s) for movement, transportation or management.

2.24 "Spot Price" as referred in Section 3.2 shall mean the price listed in
the publication specified by the parties in the Base Contract, under the
listing applicable to the geographic location closest in proximity to the
Delivery Point(s) for the relevant Day; provided, if there is no single
price published for such location for such Day, but there is published a
range of prices, then the Spot Price shall be the average of such high and
low prices. If no price or range of prices is published for such Day, then
the Spot Price shall be the average of the following: (i) the price
(determined as stated above) for the first Day for which a price or range of
prices is published that next precedes the relevant Day; and (ii) the price
(determined as stated above) for the first Day for which a price or range of
prices is published that next follows the relevant Day.

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2.25 "Transaction Confirmation" shall mean the document, substantially in
the form of Exhibit A, setting forth the terms of a purchase and sale
transaction formed pursuant to Section 1. for a particular Delivery Period.

2.26 "Transporter(s)" shall mean all Gas gathering or pipeline companies, or
local distribution companies, acting in the capacity of a transporter,
transporting Gas for Seller or Buyer upstream or downstream, respectively,
of the Delivery Point pursuant to a particular Transaction Confirmation.

SECTION 3. PERFORMANCE OBLIGATION

3.1 Seller agrees to sell and deliver, and Buyer agrees to receive and
purchase, the Contract Quantity for a particular transaction in accordance
with the terms of the Contract. Sales and purchases will be on a Firm or
Interruptible basis, as specified in the Transaction Confirmation.

THE PARTIES HAVE SELECTED THE "COVER STANDARD" VERSION OR THE "SPOT PRICE
STANDARD" VERSION AS INDICATED ON THE BASE CONTRACT.

COVER STANDARD:

3.2 In addition to any liability for Imbalance Charges, which shall not be
recovered twice by the following remedy, the exclusive and sole remedy of
the parties in the event of a breach of a Firm obligation shall be recovery
of the following: (i) in the event of a breach by Seller on any Day(s),
payment by Seller to Buyer in an amount equal to the positive difference, if
any, between the purchase price paid by Buyer utilizing the Cover Standard
for replacement Gas or alternative fuels and the Contract Price, adjusted
for commercially reasonable differences in transportation costs to or from
the Delivery Point(s), multiplied by the difference between the Contract
Quantity and the quantity actually delivered by Seller for such Day(s); or
(ii) in the event of a breach by Buyer on any Day(s), payment by Buyer to
Seller in the amount equal to the positive difference, if any, between the
Contract Price and the price received by Seller utilizing the cover Standard
for the resale of such Gas, adjusted for commercially reasonable differences
in transportation costs to or from the Delivery Point(s) multiplied by the
difference between the Contract Quantity and the quantity actually taken by
Buyer for such Day(s); or (iii) in the event that Buyer has used
commercially reasonable efforts to replace the Gas or Seller has used
commercially reasonable efforts to sell the Gas to a third party, and no
such replacement or sale is available, then the exclusive and sole remedy of
the non-breaching party shall be any unfavorable difference between the
Contract Price and the Spot Price, adjusted for such transportation to the
applicable Delivery Point, multiplied by the difference between the Contract
Quantity and the quantity actually delivered by Seller and received by Buyer
for such Day(s).

SPOT PRICE STANDARD:

3.2 In addition to any liability for Imbalance Charges, which shall not be
recovered twice by the following remedy, the exclusive and sole remedy of
the parties in the event of a breach of a Firm obligation shall be recovery
of the following: (i) in the event of a breach by Seller on any Day(s),
payment by Seller to Buyer in an amount equal to the difference between the
Contract Quantity and the actual quantity delivered by Seller and received
by Buyer for such Day(s), multiplied by the positive difference, if any,
obtained by subtracting the Contract Price from the Spot Price; (ii) in the
event of a breach by Buyer on any Day(s), payment by Buyer to Seller in an
amount equal to the difference between the Contract Quantity and the actual
quantity delivered by Seller and received by Buyer for such Day(s),
multiplied by the positive difference, if any, obtained by subtracting the
applicable Spot Price from the Contract Price.

         EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED HEREIN, IN NO EVENT WILL
EITHER PARTY BE LIABLE UNDER THIS CONTRACT, WHETHER IN CONTRACT, IN TORT
(INCLUDING NEGLIGENCE AND STRICT LIABLITY), OR OTHERWISE, FOR INCIDENTAL,
CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES.

SECTION 4.  TRANSPORTATION, NOMINATIONS AND IMBALANCES

4.1 Seller shall have the sole responsibility for transporting the Gas to
the Delivery Point(s) and for delivering such Gas at a pressure sufficient
to effect such delivery but not to exceed the maximum operating pressure of
the Receiving Transporter. Buyer shall have the sole responsibility for
transporting the Gas from the Delivery Point(s).

4.2 The parties shall coordinate their nomination activities, giving
sufficient time to meet the deadlines of the affected Transporter(s). Each
party shall give the other party timely prior notice, sufficient to meet the
requirements of all Transporter(s) involved in the transaction, of the
quantities of Gas to be delivered and purchased each Day. Should either
party become aware that actual deliveries at the Delivery Point(s) are
greater or lesser than the Scheduled Gas, such party shall promptly notify
the other party.

4.3 The parties shall use commercially reasonable efforts to avoid
imposition of any Imbalance Charges. If Buyer or Seller receives an invoice
from a Transporter that includes Imbalance Charges, the parties shall
determine the validity as well as the cause of such Imbalance Charges. If
the Imbalance Charges were incurred as a result of Buyer's actions or
inactions (which shall include, but shall not be limited to, Buyer's failure
to accept quantities of Gas equal to the Scheduled Gas), then Buyer shall
pay for such Imbalance Charges, or reimburse Seller for such Imbalance
Charges paid by Seller to the Transporter. If the Imbalance Charges were
incurred as a result of Seller's actions or inactions (which shall include,
but shall not be limited to, Seller's failure to deliver quantities of Gas
equal to the Scheduled

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Gas), then Seller shall pay for such Imbalance Charges, or reimburse Buyer
for such Imbalance Charges paid by Buyer to the Transporter.

SECTION 5.  QUALITY AND MEASUREMENT

All Gas delivered by Seller shall meet the quality and heat content
requirements of the Receiving Transporter. The unit of quantity measurement
for purposes of this Contract shall be one MMBtu dry. Measurement of Gas
quantities hereunder shall be in accordance with the established procedures
of the Receiving Transporter.

SECTION 6.  TAXES

The parties have selected either the "Buyer Pays At and After Delivery
Point" version or the "Seller Pays Before and At Delivery Point" version as
indicated on the Base Contract.

BUYER PAYS AT AND AFTER DELIVERY POINT:

Seller shall pay or cause to be paid all taxes, fees, levies, penalties,
licenses or charges imposed by any government authority ("Taxes") on or with
respect to the Gas prior to the Delivery Point (s). Buyer shall pay or cause
to be paid all Taxes on or with respect to the Gas at the Delivery Point(s)
and all Taxes after the Delivery Point(s). If a party is required to remit
or pay Taxes that are the other party's responsibility hereunder, the party
responsible for such Taxes shall promptly reimburse the other party for such
Taxes. Any party entitled to an exemption from any such Taxes or charges
shall furnish the other party any necessary documentation thereof.

SELLER PAYS BEFORE AND AT DELIVERY POINT:

Seller shall pay or cause to be paid all taxes, fees, levies, penalties,
licenses or charges imposed by any government authority ("Taxes") on or with
respect to the Gas prior to the Delivery Point(s) and all Taxes at the
Delivery Point(s). Buyer shall pay or cause to be paid all Taxes on or with
respect to the Gas after the Delivery Point(s). If a party is required to
remit or pay Taxes which are the other party's responsibility hereunder, the
party responsible for such Taxes shall promptly reimburse the other party
for such Taxes. Any party entitled to an exemption from any such Taxes or
charges shall furnish the other party any necessary documentation thereof.

SECTION 7.  BILLING, PAYMENT AND AUDIT

7.1 Seller shall invoice Buyer for Gas delivered and received in the
preceding Month and for any other applicable charges, providing supporting
documentation acceptable in industry practice to support the amount charged.
If the actual quantity delivered is not known by the billing date, billing
will be prepared based on the quantity of Scheduled Gas. The invoiced
quantity will then be adjusted to the actual quantity on the following
Month's billing or as soon thereafter as actual delivery information is
available.

7.2 Buyer shall remit the amount due in the manner specified in the Base
Contract, in immediately available funds, on or before the later of the
Payment Date or 10 days after receipt of the invoice by Buyer; provided that
if the Payment Date is not a Business Day, payment is due on the next
Business Day following that date. If Buyer fails to remit the full amount
payable by it when due, interest on the unpaid portion shall accrue at a
rate equal to the lower of (i) the then-effective prime rate of interest
published under "Money Rates" by The Wall Street Journal, plus two percent
per annum from the date due until the date of payment; or (ii) the maximum
applicable lawful interest rate. If Buyer, in good faith, disputes the
amount of any such statement or any part thereof, Buyer will pay to Seller
such amount as it concedes to be correct; provided, however, if Buyer
disputes the amount due, Buyer must provide supporting documentation
acceptable in industry practice to support the amount paid or disputed.

7.3 In the event any payments are due Buyer hereunder, payment to Buyer
shall be made in accordance with Section 7.2. above.

7.4 A party shall have the right, at its own expense, upon reasonable notice
and at reasonable times, to examine the books and records of the other party
only to the extent reasonably necessary to verify the accuracy of any
statement, charge, payment, or computation made under the Contract. This
examination right shall not be available with respect to proprietary
information not directly relevant to transactions under this Contract. All
invoices and billings shall be conclusively presumed final and accurate
unless objected to in writing, with adequate explanation and/or
documentation, within two years after the Month of Gas delivery. All
retroactive adjustments under Section 7. shall be paid in full by the party
owing payment within 30 days of notice and substantiation of such
inaccuracy.

SECTION 8.  TITLE, WARRANTY AND INDEMNITY

8.1 Unless otherwise specifically agreed, title to the Gas shall pass from
Seller to Buyer at the Delivery Point(s). Seller shall have responsibility
for and assume any liability with respect to the Gas prior to its delivery
to Buyer at the specified

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Delivery Point(s). Buyer shall have responsibility for and any liability
with respect to said Gas after its delivery to Buyer at the Delivery
Point(s).

8.2 Seller warrants that it will have the right to convey and will transfer
good and merchantable title to all Gas sold hereunder and delivered by it to
Buyer, free and clear of all liens, encumbrances and claims.

8.3 Seller agrees to indemnify Buyer and save it harmless from all losses,
liabilities or claims including attorneys' fees and costs of court
("Claims"), from any and all persons, arising from or out of claims of
title, personal injury or property damage from said Gas or other charges
thereon which attach before title passes to Buyer. Buyer agrees to indemnify
Seller and save it harmless from all Claims, from any and all persons,
arising from or out of claims regarding payment, personal injury or property
damage from said Gas or other charges thereon which attach after title
passes to Buyer.

8.4 Notwithstanding the other provisions of this Section 8., as between
Seller and Buyer, Seller will be liable for all Claims to the extent that
such arise from the failure of Gas delivered by Seller to meet the quality
requirements of Section 5.

SECTION 9.  NOTICES

9.1 All Transaction Confirmations, invoices, payments and other
communications made pursuant to the Base Contract ("Notices") shall be made
to the addresses specified in writing by the respective parties from time to
time.

9.2 All Notices required hereunder may be sent by facsimile or mutually
acceptable electronic means, a nationally recognized overnight courier
service, first class mail or hand delivered.

9.3 Notice shall be given when received on a Business Day by the addressee.
In the absence of proof of the actual receipt date, the following
presumptions will apply. Notices sent by facsimile shall be deemed to have
been received upon the sending party's receipt of its facsimile machine's
confirmation of successful transmission, if the day on which such facsimile
is received is not a Business Day or is after five p.m. on a Business Day,
then such facsimile shall be deemed to have been received on the next
following Business Day. Notice by overnight mail or courier shall be deemed
to have been received on the next Business Day after it was sent or such
earlier time as is confirmed by the receiving party. Notice via first class
mail shall be considered delivered two Business Days after mailing.

SECTION 10.  FINANCIAL RESPONSIBILITY

10.1 When reasonable grounds for insecurity of payment or title to the Gas
arise, either party may demand adequate assurance of performance. Adequate
assurance shall mean sufficient security in the form and for the term
reasonably specified by the party demanding assurance, including, but not
limited to, a standby irrevocable letter of credit, a prepayment, a security
interest in an asset acceptable to the demanding party or a performance bond
or guarantee by a creditworthy entity. In the event either party shall
(i) make an assignment or any general arrangement for the benefit of creditors;
(ii) default in the payment obligation to the other party; (iii) file a
petition or otherwise commence, authorize, or acquiesce in the commencement
of a proceeding or cause under any bankruptcy or similar law for the
protection of creditors or have such petition filed or proceeding commenced
against it; (iv) otherwise become bankrupt or insolvent (however evidenced);
or (v) be unable to pay its debts as they fall due; then the other party
shall have the right to either withhold and/or suspend deliveries or
payment, or terminate the Contract without prior notice, in addition to any
and all other remedies available hereunder. Seller may immediately suspend
deliveries to Buyer hereunder in the event Buyer has not paid any amount due
Seller hereunder on or before the second day following the date such payment
is due.

10.2 Each party reserves to itself all rights, set-offs, counterclaims, and
other defenses which it is or may be entitled to arising from the Contract.

SECTION 11.  FORCE MAJEURE

11.1 Except with regard to a party's obligation to make payment due under
Section 7. and Imbalance Charges under Section 4, neither party shall be
liable to the other for failure to perform a Firm obligation, to the extent
such failure was caused by Force Majeure. The term "Force Majeure" as
employed herein means any cause not reasonably within the control of the
party claiming suspension, as further defined in Section 11.2.

11.2 Force Majeure shall include but not be limited to the following:
(i) physical events such as acts of God landslides, lightning, earthquakes,
fires, storms or storm warnings, such as hurricanes, which result in
evacuation of

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the affected area, floods, washouts, explosions, breakage or accident or
necessity of repairs to machinery or equipment or lines of pipe; (ii)
weather related events affecting an entire geographic region, such as low
temperatures which cause freezing or failure of wells or lines of pipe;
(iii) interruption of firm transportation and/or storage by Transporters;
(iv) acts of others such as strikes, lockouts or other industrial
disturbances, riots, sabotage, insurrections or wars; and (v) governmental
actions such as necessity for compliance with any court order, law, statute,
ordinance, or regulation promulgated by a governmental authority having
jurisdiction. Seller and Buyer shall make reasonable efforts to avoid the
adverse impacts of a Force Majeure and to resolve the event or occurrence
once it has occurred in order to resume performance.

11.3 Neither party shall be entitled to the benefit of the provisions of
Force Majeure to the extent performance is affected by any or all of the
following circumstances: (i) the curtailment of interruptible or secondary
firm transportation unless primary, in-path, firm transportation is also
curtailed; (ii) the party claiming excuse failed to remedy the condition and
to resume the performance of such covenants or obligations with reasonable
dispatch; or (iii) economic hardship. The party claiming Force Majeure shall
not be excused from its responsibility for Imbalance Charges.

11.4 Notwithstanding anything to the contrary herein, the parties agree that
the settlement of strikes, lockouts or other industrial disturbances shall
be entirely within the sole discretion of the party experiencing such
disturbance.

11.5 The party whose performance is prevented by Force Majeure must provide
notice to the other party. Initial notice may be given orally; however,
written notification with reasonably full particulars of the event or
occurrence is required as soon as reasonably possible. Upon providing
written notification of Force Majeure to the other party, the affected party
will be relieved of its obligation to make or accept delivery of Gas as
applicable to the extent and for the duration of Force Majeure, and neither
party shall be deemed to have failed in such obligations to the other during
such occurrence or event.

SECTION 12.  TERM

This Contract may be terminated on 30 days' written notice, but shall remain
in effect until the expiration of the latest Delivery Period of any
Transaction Confirmation(s). The rights of either party pursuant to Section
7.4., the obligations to make payment hereunder, and the obligation of
either party to indemnify the other, pursuant hereto shall survive the
termination of the Base Contract or any Transaction Confirmation.

SECTON 13.  MISCELLANEOUS

13.1 This Contract shall be binding upon and inure to the benefit of the
successors, assigns, personal representatives, and heirs of the respective
parties hereto, and the covenants, conditions, rights and obligations of
this Contract shall run for the full term of this Contract. No assignment of
this Contract, in whole or in part, will be made without the prior written
consent of the non-assigning party, which consent will not be unreasonably
withheld or delayed; provided, either party may transfer its interest to any
parent or affiliate by assignment, merger or otherwise without the prior
approval of the other party. Upon any transfer and assumption, the
transferor shall not be relieved of or discharged from any obligations
hereunder.

13.2 If any provision in this Contract is determined to be invalid, void or
unenforceable by any court having jurisdiction, such determination shall not
invalidate, void or make unenforceable any other provision, agreement or
covenant of this Contract.

13.3 No waiver of any breach of this Contract shall be held to be a waiver
of any other or subsequent breach.

13.4 This Contract sets forth all understandings between the parties
respecting each transaction subject hereto, and any prior contracts,
understandings and representations, whether oral or written, relating to
such transactions are merged into and superseded by this Contract and any
effective Transaction Confirmation(s). This Contract may be amended only by
a writing executed by both parties.

13.5 The interpretation and performance of this Contract shall be governed
by the laws of the state specified by the parties in the Base Contract,
excluding, however, any conflict of laws rule which would apply the law of
another jurisdiction.

13.6 This Contract and all provisions herein will be subject to all
applicable and valid statutes, rules, orders and regulations of any Federal,
State or local governmental authority having jurisdiction over the parties,
their facilities, or Gas supply, this Contract or Transaction Confirmation
or any provisions thereof.

13.7 There is no third party beneficiary to this Contract.

13.8 Each party to this Contract represents and warrants that it has full
and complete authority to enter into and perform this Contract. Each person
who executes this Contract on behalf of either party represents and warrants
that it has full and complete authority to do so and that such party will be
bound thereby.

                                     7<PAGE>

                                                                  EXHIBIT 10(o)

                                OIL AND GAS LEASE
                             KENTUCKY-TENNESSEE FORM

         THIS AGREEMENT, made and entered into this 19th day of July, 1995, by
and between Meredith J. Evans and Helen Evans, his wife, P.O. Box 1238.
Middlesboro, Kentucky 40965, party of the first part, hereinafter called Lessor
(whether one or more) and Paddock Oil and Gas, Inc., 101 Paddock Drive,
Nicholasville, Kentucky 40356, party of the second part, hereinafter called
Lessee.

         WITNESSETH that the Lessor, for and in consideration of Ten Dollars
($10.00) cash in hand paid, the receipt of which is hereby acknowledged, and the
covenants and agreements hereinafter contained, has granted, demised, leased and
let exclusively unto the said Lessee, its successors and assigns, the land
hereinafter described, for the purpose of mining, exploring by geophysical and
other methods, and operating for and producing therefrom oil, gas, casing-head
gas, casing-head gasoline, and the exclusive right of injecting gas, water,
brine and other fluids or substances into the subsurface strata, with rights of
way and permanent easements for laying pipelines for the removal of oil or gas
from the below described premises as well as from gas producing wells on other
tracts, telephone, telegraph and electrical lines, tanks, power houses,
stations, gasoline plants, ponds and roadways and fixtures for producing,
treating and caring for such products and any and all other rights and
privileges necessary, incident to, or convenient for the economical operation
alone or conjointly with neighboring land, for the production of oil, gas,
casing-head gas, casing-head gasoline, and the erection of structures thereon to
produce, save and take care of said products.

LEASED PREMISES: All that certain tract of land situated in the County of Bell,
State of Kentucky, bounded as follows, to-wit:
         On the North by lands of Bill Lee Fuson, now or formerly
         On the East by lands of Donna Smith, et al.
         On the South by lands of Lizzie Freeman, et al., J.M. Huber
         On the West by lands of Kentucky State Forest, Donna Smith
         Containing 490 acres, more or less and being the same land conveyed to
Lessor by F. Marion Evans
          deed dated 4/19/55, recorded in Deed Book 206, Page 588 D.L. Evans
---------
deed dated 3/1/90, recorded in Deed Book 272, Page 175 M.J. Evans deed dated
3/23/94, recorded in Deed Book 276, Page 461 Bell County Clerk or Register's
Office.
         It being intended hereby to include all lands and interests therein
contiguous to or appurtenant to said described lands or claimed by Lessor.

<PAGE>
<PAGE>

TERM OF LEASE It is agreed that this lease shall remain in force for a term of
five (5) years from this date and as long thereafter as oil, gas, casing-head
gas, casing-head gasoline or any of them is produced from said leased premises
or shut-in royalty or rental is paid for the right to inject, store and remove
gas in and from the oil and gas strata underlying said premises, as hereinafter
provided; or operations for drilling are continued as hereinafter provided; or
Lessor consumes gas free of cost for stoves and inside lights in the principal
dwelling house, as hereinafter provided.

         In consideration of the premises the said Lessee covenants and agrees:

         1. ROYALTY OR SHARE OF OIL. To deliver to the credit of Lessor into
the storage tanks or in the pipeline to which Lessee may connect his wells, the
equal one-eighth (1/8th) part of all oil produced and saved from the leased
premises, or at the Lessee's option, to pay to the Lessor for such one-eighth
(1/8th) royalty, the market price for oil of like grade and gravity prevailing
on the day such oil is run into the pipeline or into storage tanks.

         2. ROYALTY FOR GAS: FREE GAS. To pay Lessor one-eighth (1/8th) of the
market price at the well for gas sold or for the gas so used from each well off
the premises, except for injection for secondary recovery of oil; and Lessor is
to have gas free of cost from any such well for all stoves and inside lights in
the principal dwelling house on said land during the same time by making his own
connections with the wells at his sole risk and expense. See Exhibit "A"
attached hereto and made a part hereof.

         3. COMMENCEMENT OF OPERATIONS. If no well be commenced on said
premises on or before the nineteenth (19th) day of July, 1996, this lease shall
terminate as to both parties, unless the Lessee, on or before the said date
shall pay or tender, in the manner hereinafter provided, a rental of One Dollar
($1.00) per acre per annum, payable quarterly or annually, which payments shall
confer the privilege of successively deferring the commencement of a well for
the quarterly or annual periods for which such rental shall be paid. All rentals
or money due hereunder shall be paid by check or draft of Lessee, or any
assignee thereof, mailed postage prepaid or delivered to Lessor at above address
or to  N/A  Bank at  N/A , as Agent for Lessor, on or before the date any
      -----         -----
such royalties or rentals or money shall become payable: said bank is hereby
made the agent of Lessor to accept all royalties, rentals or money paid
hereunder, and the same shall continue as the depository of such rentals or
royalties during the life of this lease, regardless of change

                                    2

<PAGE>
<PAGE>

in ownership of said premises, or rentals or royalties; provided, however, that
such rental shall not be due, but shall be excused, if on any such rental paying
date oil or gas, has been or is being produced from said land or drilling,
mining, or reworking operations conducted thereon; and it is agreed that after
such production or operations cease, upon the resumption of the payment of
rentals, this lease shall continue in force just as though there had been no
interruption in the rental payments. Should the depository bank hereafter close
with a successor, Lessee or his assigns may deposit rental in any National Bank
located in the same county with the first named bank with due notice of the
deposit of such rental to be mailed to the Lessor at last known post office
address.

         4. DRY HOLE. Lessor agrees that if Lessee drills a dry hole on the
leased premises or upon any pooled unit which contains a part of the leased
premises, then the term of this lease shall be extended or the payment of
rentals due hereunder shall be excused for a period of one (1) year from the
date drilling ceases on said well, and Lessee shall either commence the drilling
of another well before the end of said period or commence paying rentals as
provided hereunder. If a well capable of producing oil or gas is drilled under
this provision, Lessee shall be able to continue this lease by making the rental
or royalty payments set out hereunder.

         5. LESSOR'S SHARE OF RENTS, ETC. If said Lessor owns a less interest
in the above-described land than the entire and undivided fee simple estate
therein, then, the royalties and rentals herein provided shall be paid the
Lessor only in proportion which his interest bears to the whole and undivided
fee.

         In the event Lessor's title or interest herein is claimed by others,
Lessee shall have the right to purchase a lease or leases from others to protect
its leasehold rights and Lessee shall have the right to withhold payment of
rentals or royalties or deposit such rentals or royalties in Court until a final
determination of Lessor's rights. The withholding of such rentals or royalties
shall not be deemed a default hereinunder by the Lessee.

         6. LESSEE'S FREE UTILITIES, ETC. Lessee shall have the right to use,
free of cost, gas, oil and water produced on said land for its operation
thereon, except water from wells of Lessor.

         7. LOCATION OF PIPELINE. When requested by Lessor, Lessee shall bury
its pipelines below plow depth.

                                    3

<PAGE>
<PAGE>

         8. LOCATION OF WELLS. No well shall be drilled nearer than two
hundred (200) feet to any house or barn on said premises, without the
written consent of the Lessor.

         9. RECLAMATION. Lessee shall repair any damage to existing roads,
fences, gates, etc. which results from Lessee's presence on Lessor's
premises and further Lessee shall reclaim, to the best of its ability, any
damages to Lessor's land.

         10. DAMAGE TO CROPS. Lessee shall pay for damage to growing crops
caused by its operation on said lands.

         11. REMOVAL OF EQUIPMENT. Lessee shall have the right at any time
within one (1) year after termination of this lease to remove all machinery
and fixtures placed on said premises, including the right to draw and remove
casing.

         12. COMPLETION OF DRILLING. If the Lessee shall commence to drill a
well within the term of this lease or any extension thereof, the Lessee
shall have the right to drill such well to completion with reasonable
diligence and dispatch, and if oil and gas, or either of them, be found,
this lease shall continue and be in force with like effect as if such well
had been completed within the term herein with Lessee paying rental, royalty
or shut-in royalty payments.

         13. TRANSFER OR ASSIGNMENT. If the estate of either party hereto is
assigned, and the privilege of assigning in whole or in part is expressly
allowed, the covenants hereof shall extend to their heirs, executors,
successors or assigns, but no change in the ownership of the land or
assignment of rental or royalties shall be binding on the Lessee until after
the Lessee has been furnished with a written transfer or assignment or a
true copy thereof; and it is hereby agreed in the event this lease shall be
assigned, as to a part or parts of the above-described lands and the
assignee or assignees of such parts shall fail or make default in the
payment of the proportionate part of the rent due from him or them, such
default shall not operate to defeat or affect this lease in so far as it
covers a part or parts of said lands which the said Lessee or any assignee
thereof shall make due payment of said rental.

         14. SEVERAL OWNERS. If the leased premises are now, or shall
hereafter be, owned in severalty or in separate tracts, the premises
nevertheless shall be developed and operated as one lease, and all rentals
and royalties accruing hereunder shall be treated as an entirety and shall
be divided among, and paid to, such separate owners in the proportion that
the acreage owned by each separate owner bears to the entire leased acreage;
provided, however, if the leased premises consist of

                                    4

<PAGE>
<PAGE>

two (2) or more non-abutting tracts, this paragraph shall apply separately
to each such non-abutting tract, and further provided that if a portion of
the leased premises is hereafter pooled or combined with other lands for the
purpose of operating the pooled tract as one lease, this paragraph shall be
inoperative as to such portion so pooled and paragraph 15 shall apply.

         15. COMMON AGENT. If at any time there be as many as four (4)
parties entitled to rentals or royalties, Lessee may withhold payments
thereof unless and until all parties designate, in writing, a recordable
instrument to be filed with the Lessee, a common agent to receive all
payments due hereunder, and to execute division and transfer orders on
behalf of said parties and their respective successors in title.

         16. POOLING ACREAGE. Lessee is hereby given the right and power to
pool or combine the acreage covered by this lease or any portion thereof
with other land, lease or leases in the immediate vicinity thereof, when in
Lessee's judgment it is necessary or advisable to do so in order to properly
develop and operate said premises in compliance with spacing rules of any
lawful authority, or when to do so would, in the judgment of the Lessee,
promote the conservation of the oil and gas in and under and that may be
produced from said premises. If oil or gas is found on the pooled acreage,
it shall be treated as if production is had from this lease for all purposes
except the payment of royalties on production from the pooled unit, whether
the well or wells be located on the premises covered by this lease or not.
In lieu of the rentals or royalties elsewhere herein specified, Lessor shall
receive as rental or royalty from a unit so pooled only such portion of the
rental or royalty stipulated herein as the amount of his acreage placed in
the unit or his royalty interest therein bears to the total acreage so
pooled in the particular unit involved. Provided, Lessee shall be under no
obligation whatsoever, express or implied, to drill more than one (1) well
on each such pooled unit regardless of when, where or by whom offset wells
may be drilled. Such units to be a maximum of eighty (80) acres for each oil
well and six hundred forty (640) acres for each gas well with Lessee
executing in writing an instrument identifying and describing the pooled
acreage.

         17. DOWER AND HOMESTEAD RIGHTS. The undersigned Lessors, for
themselves and their heirs, successors and assigns, hereby surrender and
release all rights of dower and homestead in the premises herein described,
insofar as said right of dower and homestead may in any way affect the
purpose for which this lease is made as recited herein.

                                    5

<PAGE>
<PAGE>

         18. GAS STORAGE. Lessee shall have the right to use any formation
underlying the leased premises for the storage of gas and shall have all
rights and right-of-way necessary to store and produce such stored gas. As
full payment for such storage rights, the Lessee shall pay to the Lessor
rental at the rate of One Dollar ($1.00) per acre per year, while the
premises are so used, and so long as the storage payment is made, all
provisions of this lease shall remain in full effect.

         19. SHUT-IN ROYALTY. This lease shall not expire at the end of
either the primary or secondary term hereof if there is a well capable of
producing gas in paying quantities located upon some part of the lands
embraced herein, or on a pooled unit which contains a part of the leased
premises, where such well is shut-in due to the inability of the Lessee to
obtain a pipeline connection or to market the gas therefrom; provided,
however, the Lessee shall pay an annual royalty of One Dollar ($1.00) per
acre, said royalty to be paid on or before the expiration of one (1) year
from the date said well was shut-in or if said shut-in royalty is not made
by Lessee within the time period aforementioned, Lessor shall notify Lessee
in writing and demand payment which Lessee shall then have ten (10)
additional days to remit payment thereof. The payment of said royalty shall
be considered for all purposes the same as if gas were being produced in
paying quantities and upon the commencement of marketing of gas from said
well or wells the royalty paid for the lease year in which the gas is first
marketed shall be credited upon the royalty payable hereunder to the Lessor
for such year. The provisions of this section shall also apply where gas is
being marketed from said leasehold premises and through no fault of the
Lessee, the pipeline connection or market is lost or ceases, in which case
this lease shall not expire so long as said royalty is paid as herein
provided.

         20. STATE AND FEDERAL LAWS. All express or implied covenants of
this lease shall be subject to all federal and state laws and to all
executive orders, rules or regulations of state and federal authorities and
this lease shall not be terminated, in whole or in part, nor Lessee held
liable for any failure to perform thereunder if such failure is due to the
result of any such law, order, rule or regulation.

         21. WARRANTY CLAUSE. Lessor consents to the payment of any
royalties hereunder to any mortgagee or trustee under a deed of trust on
said lands and agrees that any such payments shall be treated as though said
payments were made directly to Lessor.

         Lessor hereby warrants and agrees to defend the title to the lands
herein described, and agrees that the Lessee shall have the right at any time
to redeem for Lessor, by payment any mortgage, deed of trust, taxes

                                    6

<PAGE>
<PAGE>

or other liens on the above-described lands, in the event of default of
payment by Lessor, and be subrogated to the rights of the holder thereof and
Lessor hereby agrees that any such payment made by the Lessee for the Lessor
shall be deducted from any amounts of money which may become due the Lessor
under the terms of this lease.

         Lessor agrees to execute a Division Order which correctly and properly
denotes the interests of all parties owning an interest in the well; and Lessor
further agrees that any royalties due from production may be held in escrow
until such Division Order is executed.

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

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

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

         IN TESTIMONY WHEREOF, witness the signatures of the parties hereto:

                           (SEAL)             /s/ Meredith J. Evans      (SEAL)
---------------------------                   ---------------------------
                                              Meredith J. Evans SS####-##-####

                           (SEAL)             /s/ Helen Evans            (SEAL)
---------------------------                   ---------------------------
                                              Helen Evans SS# ###-##-####

                           (SEAL)                                        (SEAL)
---------------------------                   ---------------------------

                           (SEAL)                                        (SEAL)
---------------------------                   ---------------------------

                                 ACKNOWLEDGEMENT

STATE OF KENTUCKY )
                  ) SS.
COUNTY OF BELL    )

         I, the undersigned, a Notary Public in and for said County and State,
do hereby certify Meredith J. Evans and Helen Evans to me personally known, and
                  ---------------------------------
known to me to be the same person described in and who executed the foregoing
instrument, appeared before me today in person and acknowledged to me that they
executed the same as their free and voluntary act and deed, for the uses,
purposes and consideration therein expressed, including the relinquishment of
dower and homestead.

         Given under my hand this 19th day of July, A.D., 1995.

My Commission Expires: June 12, 1995.

                                              /s/ Ralph Vernon Smith
                                              ---------------------------
                                              NOTARY PUBLIC

                                    7

<PAGE>
<PAGE>

STATE OF                             )       CORPORATE ACKNOWLEDGEMENT
         ---------------------------
                                     )       SS.
COUNTY OF                            )
          --------------------------

         Before me, a Notary Public in and for the aforesaid county and
state, appeared                                              as President
                --------------------------------------------
and                         as Secretary of
   ------------------------                 -----------------------------
(a corporation), producing the foregoing instrument, and being duly sworn by
me, each severally acknowledged said instrument to be the act and deed of
said corporation, for the uses and purposes therein set forth, and each
further acknowledged his execution of same, in the capacity stated above,
and the affixing of the seal of said corporation thereof, pursuant to
authority duly granted by the Board of Directors of said corporation, and
that each declaration in said instrument and this acknowledgement are true.
GIVEN UNDER MY HAND AND SEAL this       day of             , 20  .
                                  -----        ------------    --
My commission expires:
                        -----------------------------

                                               ------------------------------
                                               Sign

                                               R. Vernon Smith
                                               ------------------------------
                                               Print Name

This lease prepared by:

R. Vernon Smith
101 Paddock Drive
Nicholasville, KY 40356

By:
   ----------------------------

                                 ACKNOWLEDGEMENT

STATE OF                            )
         ---------------------------
                                    )        SS.
COUNTY OF                           )
          --------------------------

         I, the undersigned, a Notary Public in and for said County and State,
do hereby certify                                                  to me
                  ------------------------------------------------
personally known, and known to me to be the same person described in and who
executed the foregoing instrument, appeared before

                                    8

<PAGE>
<PAGE>

me today in person and acknowledged to me that           executed the same as
                                               ----------
           free and voluntary act and deed, for the uses, purposes and
----------
consideration therein expressed, including the relinquishment of dower and
homestead.

         Given under my hand this       day of                A.D., 20   .
                                  -----        --------------         ---
My Commission Expires:
                        -----------------------------

                                         ---------------------------------
                                         NOTARY PUBLIC

                                   ASSIGNMENT

         For and in consideration of One Dollar ($1.00) cash in hand paid, and
other good and valuable considerations, the receipt of all of which is hereby
acknowledged, I hereby transfer and assign to
                                             ---------------------------------

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

------------------------------------------------------------------------------
the within lease.

         Given under my hand this       day of                , A.D., 20  .
                                  -----        ---------------          --

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

State of Kentucky, County of                                   S.S.
                             ---------------------------------

         I,                   , a                                       in and
            ------------------    -------------------------------------
for the County and State aforesaid, do hereby certify that             Lessee in
                                                           -----------
the foregoing lease, this day appeared before me and produced the foregoing
assignment and acknowledged the same to be his act and deed.

         Given under my hand this       day of             A.D., 20  .
                                  -----        -----------         --

My Commission Expires:
                      -----------------------------

                                    9

<PAGE>
<PAGE>

                                   EXHIBIT "A"

Attached to and made a part of that certain Oil and Gas Lease dated the 19th
day of July, 1995, by and between Meredith J. Evans and Helen Evans as
Lessor, and Paddock Oil and Gas, Inc. as Lessee.

Lessor may have gas, free of cost, up to 200,000 cubic feet annually, for
domestic use in one (1) dwelling house for heating, cooling and cooking purposes
only, on the herein leased premises from any gas well thereon so long as Lessee
operates such well and uses or sells gas therefrom. Lessor shall pay for all gas
used over 200,000 cubic feet annually at the Lessee's prevailing farm tap rate
in the area. Lessor shall construct or cause to be constructed in compliance
with all governmental regulations and laws applicable to such connections, the
service line and shall maintain and keep the service line in good repair. Lessor
shall provide and install or cause to be installed and keep in good repair, the
necessary automatic gas regulators, and shall pay the entire cost thereof.
Lessee is hereby released from all liability and expenses arising out of such
use. Lessor assumes all responsibility and liability for any and all injuries,
loss of life and damage to property which may result from Lessor taking,
handling, or using of gas hereunder. Notwithstanding the provisions of this
paragraph or any other section of this lease, should the lease be made part of a
Unit and the well is not actually located on the leased premises, but is on
other property within the unit, then the Lessor shall not be entitled to free
gas from the Unit well.

Signed for identification this 19th day of July, 1995.

  /s/ Meredith J. Evans
---------------------------
Meredith J. Evans

  /s/ Helen Evans
---------------------------
Helen Evans

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

PADDOCK OIL AND GAS, INC.

By:  /s/ R. Vernon Smith
   ---------------------------

                                    10

<PAGE>
<PAGE>

State of Kentucky

County of Bell

         I, Joan Asher Cawood, clerk within and for the state and county
aforesaid, do hereby certify that the foregoing Oil and Gas Lease from
Meredith J. and Helen Evans to Paddock Oil and Gas, Inc. was this day lodged
for record; whereupon the same has been duly recorded in Lease Book No. 40
at Page No. 775, record of my said office.

         Given under my hand this the 19th day of July, 1995.

                                                     JOAN ASHER CAWOOD, CLERK

                                                     By:   /s/ Beth Hurst
                                                        ---------------------
                                                           DEPUTY CLERK

                                    11

<PAGE>
<PAGE>

                          SCHEDULE OF SIMILAR CONTRACTS

The following listed oil and gas leases are substantially similar to the Oil and
Gas Lease, dated July 19, 1995 (the "July 1995 Evans Oil and Gas Lease"), by and
between Meredith J. Evans and Helen Evans and Paddock Oil and Gas, Inc. filed as
part of this Exhibit 10(o) (which appears in its entirety above) and are
assigned by the Assignments and Assignment and Assumption Agreement filed as
part of this Exhibit 10(o) (which appear in their entirety below). This Schedule
identifies these additional omitted oil and gas leases and sets forth the
material details in such oil and gas leases that differ from the July 1995 Evans
Oil and Gas Lease.

1.       Oil and Gas Lease, dated March 11, 1995, by and between Oliver
         Gregory and Nell Gregory and Paddock Oil and Gas, Inc. Leased Premises
         located in Bell County, Kentucky, bounded on the North by lands of
         Kentucky State Forest, on the East by lands of Kentucky State Forest,
         on the South by lands of Pink Fuson Heirs and on the West by lands of
         J. M. Huber, and containing 117.5 acres more or less.

2.       Oil and Gas Lease, dated February 11, 1995, by and between Meredith J.
         Evans and Helen Evans and Paddock Oil and Gas, Inc. Leased Premises
         located in Bell County, Kentucky and bounded on the North by lands of
         Donna E. Smith, on the East by lands of Donna E. Smith, on the South by
         lands of J.M. Huber Corporation and on the West by lands of Donna E.
         Smith, and containing 60 acres more or less.

3.       Oil and Gas Lease, dated June 21, 1995, by and between Lizzie Freeman,
         Troy Freeman, Boyd Freeman and Janice Freeman and Paddock Oil & Gas,
         Inc. Leased Premises located in Bell County, Kentucky, bounded on the
         North by lands of Donna Smith, on the East by lands of Donna Smith and
         J.M. Huber Corporation, on the South by lands of J.M. Huber
         Corporation and on the West by lands of Donna Smith, et. al., and
         containing 82 acres more or less.

4.       Oil and Gas Lease, dated December 17, 1994, by and between Donna Evans
         Smith and Kirby Smith, III and Kirby Smith, IV and Paddock Oil & Gas,
         Inc. and Amendment of Oil and Gas Lease, dated December 17, 1994, by
         and between the same parties. Leased Premises located in Bell County,
         Kentucky and bound on the North by lands of Arthur Fuson, on the East
         by lands of Thomas Carnes, on the South by lands of J.M. Huber Land
         Company and on the West by lands of Kentucky State Forest, and
         containing 1071 acres more or less.

                                    12

<PAGE>
<PAGE>

                                   ASSIGNMENT

                  KNOW ALL MEN BY THESE PRESENTS: THAT

         Paddock Oil and Gas, Inc., 101 Paddock Drive, Nicholasville,
Kentucky 40356, hereinafter referred to as ASSIGNOR, for and in
consideration of the sum of Ten Dollars ($10.00) and other good and valuable
consideration to it paid by Lonnie D. Ferrin, 431 Electra Drive, Houston,
Texas 77024, hereinafter referred to as ASSIGNEE, does hereby sell, assign,
transfer, set over and convey unto ASSIGNEE, his heirs and assigns, subject
to the terms, conditions and reservations herein contained, all of
ASSIGNOR'S right, title and interest in and to the oil and gas leases
embracing lands in Bell County, Kentucky, as set forth on Exhibit "A"
attached hereto and made a part hereof, together with a like interest in all
rights incident to or obtained by virtue of the oil and gas leases, the
personal property and equipment thereon, appurtenant thereto and used or
obtained in connection therewith.

         Out of the interest hereby transferred and assigned, the Assignor
does hereby retain and reserve unto itself, its successors and assigns, an
overriding royalty interest equal to 1/32 of 7/8 of all oil and/or gas
produced, saved and marketed from the oil and gas leases set forth and
described on Exhibit "A".

         While ASSIGNOR does not warrant the title to said oil and gas
leases generally, it nevertheless covenants to and with ASSIGNEE, his heirs
and assigns, that it has done nothing to encumber the title to said oil and
gas leases, and ASSIGNOR will warrant and defend the title to aid leases as
against all persons claiming by, through and under them, but as to no
others; and ASSIGNOR hereby transfers and assigns unto ASSIGNEE, his heirs
and assigns, the benefit of all prior warranties lying within ASSIGNOR'S
chain of title.

         IN TESTIMONY WHEREOF, witness the execution hereof by ASSIGNOR,
this 15th day of June, 1995.

                                                 PADDOCK OIL AND GAS, INC.

                                                 By:  /s/ R. Vernon Smith
                                                     ----------------------
                                                        R. Vernon Smith
                                                        President

                                    13

<PAGE>
<PAGE>

STATE OF KENTUCKY   )
                    )
COUNTY OF BREATHITT )

         The foregoing instrument was acknowledged before me by R. Vernon
Smith, President of Paddock Oil and Gas, Inc., this 15th day of June, 1995.

                  My commission expires:    3-30-97
                                         --------------

                                             /s/ Melissa M. Bush
                                            -----------------------
                                            Notary Public

This instrument prepared by:
Benjamin C. Cubbage, Jr.
P.O. Box 17 - 600 Barrett Blvd.
Henderson, Kentucky 42420

/s/ Benjamin C. Cubbage, Jr.
----------------------------

                                    14

<PAGE>
<PAGE>

                                   EXHIBIT "A"
                                   -----------

         Attached to and made a part of that certain Assignment dated the
         15th day of June, 1995, from Paddock Oil and Gas, Inc., as Assignor,
         to Lonnie D. Ferrin, as Assignee.

         1. Oil and Gas Lease dated December 17, 1994, recorded in Lease Book
40, page 444 of the Bell County Court Clerk's Office, from Donna Evans Smith and
Kirby Smith III, husband and wife, and Kirby Smith IV, single, as Lessors, to
Paddock Oil & Gas, Inc., as Lessee, covering lands in said County and State
bounded as follows, to-wit:

                           North:  Arthur Fuson
                           East:   Thomas Carnes
                           South:  J.M. Huber Land Corporation
                           West:   Kentucky State Forest

                  and containing 1000 acres, more or less.

         2. Oil and Gas Lease dated February 11, 1995, recorded Lease Book 40,
page 494 of the Bell County Court Clerk's Office, from Meredith J. Evans and
Helen Evans, his wife, as Lessors, to Paddock Oil and Gas, Inc., as Lessee,
covering lands in said County and State bounded as follows, to-wit:

                           North:  Donna E. Smith
                           East:   Donna Smith
                           South:  J.M. Huber Corporation
                           West:   Donna E. Smith

                  and containing 60 acres, more or less.

         3. Oil and Gas Lease dated March 11, 1995, recorded Lease Book 40, page
699 of the Bell County Court Clerk's Office, from Oliver Gregory and Nell
Gregory, his wife, as Lessors, to Paddock Oil and Gas, Inc., as Lessee covering
lands in said County and state bounded as follows, to-wit:

                           North:  Kentucky State Forest
                           East:   Kentucky State Forest
                           South:  Pink Fuson Heirs
                           West:   J.M. Huber now or formerly

                  and containing 117.5 acres, more or less.

                                    15

<PAGE>
<PAGE>

                                 ASSIGNMENT

                    KNOW ALL MEN BY THESE PRESENTS: THAT

         Paddock Oil and Gas, Inc., 101 Paddock Drive, Nicholasville,
Kentucky 40356, hereinafter referred to as ASSIGNOR, for and in
consideration of the sum of Ten Dollars ($10.00) and other good and valuable
consideration to it paid by Lonnie D. Ferrin, 431 Electra Drive, Houston,
Texas 77024, hereinafter referred to as ASSIGNEE, does hereby sell, assign,
transfer, set over and convey unto ASSIGNEE, his heirs and assigns, subject
to the terms, conditions and reservations herein contained, all of
ASSIGNOR'S right, title and interest in and to the oil and gas leases
embracing lands in Bell County, Kentucky, as set forth on Exhibit "A"
attached hereto and made a part hereof, together with a like interest in all
rights incident to or obtained by virtue of the oil and gas leases, the
personal property and equipment thereon, appurtenant thereto and used or
obtained in connection therewith.

         Out of the interest hereby transferred and assigned, the Assignor
does hereby retain and reserve unto itself, its successors and assigns, an
overriding royalty interest equal to 1/32 of 7/8 of all oil and/or gas
produced, saved and marketed from the oil and gas leases set forth and
described on Exhibit "A".

         While ASSIGNOR does not warrant the title to said oil and gas
leases generally, it nevertheless covenants to and with ASSIGNEE, his heirs
and assigns, that it has done nothing to encumber the title to said oil and
gas leases, and ASSIGNOR will warrant and defend the title to aid leases as
against all persons claiming by, through and under them, but as to no
others; and ASSIGNOR hereby transfers and assigns unto ASSIGNEE, his heirs
and assigns, the benefit of all prior warranties lying within ASSIGNOR'S
chain of title.

         IN TESTIMONY WHEREOF, witness the execution hereof by ASSIGNOR,
this 31st day of August, 1995.

                                                   PADDOCK OIL AND GAS, INC.

                                                     By: /s/ R. Vernon Smith
                                                        -----------------------
                                                         R. Vernon Smith
                                                         President

                                    16

<PAGE>
<PAGE>

STATE OF KENTUCKY   )
                    )
COUNTY OF BREATHITT )

         The foregoing instrument was acknowledged before me by R. Vernon
Smith, President of Paddock Oil and Gas, Inc., this 31st day of August,
1995.

                  My commission expires: 3-30-97
                                        ---------

                                            /s/ Melissa M. Bush
                                            -------------------------
                                            Notary Public

This instrument prepared by:
Benjamin C. Cubbage, Jr.
P.O. Box 17 - 600 Barrett Blvd.
Henderson, Kentucky 42420

 /s/ Benjamin C. Cubbage, Jr.
------------------------------

                                    17

<PAGE>
<PAGE>

                                   EXHIBIT "A"
                                   -----------

         Attached to and made a part of that certain Assignment dated the
         31st day of August, 1995,from Paddock Oil and Gas, Inc., as Assignor,
         to Lonnie D. Ferrin, as Assignee.

         1. Oil and Gas Lease dated June 21, 1995, recorded in Lease Book 40,
page 770 of the Bell County Court Clerk's Office, from Lizzie Freeman, widow,
Troy Freeman, single, and Boyd Freeman and Janice Freeman, his wife, as Lessors,
to Paddock Oil & Gas, Inc., as Lessee, covering lands in said County and State
bounded as follows, to-wit:

                           North:   Donna Smith
                           East:    Donna Smith; J.M. Huber Corporation
                           South:   J.M. Huber Corporation
                           West:    Donna Smith, et al

                  and containing 82 acres, more or less.

         2. Oil and Gas Lease dated July 19, 1995, recorded Lease Book 40, page
775 of the Bell County Court Clerk's Office, from Meredith J. Evans and Helen
Evans, his wife, as Lessors, to Paddock Oil and Gas, Inc., as Lessee, covering
lands in said County and State bounded as follows, to-wit:

                           North:   Bill Lee Fuson, now or formerly
                           East:    Donna Smith, et al
                           South:   Lizzie Freeman, et al., J.M. Huber
                           West:    Kentucky State Forest; Donna Smith

                  and containing 490 acres, more or less.

                                    18

<PAGE>
<PAGE>

                       ASSIGNMENT AND ASSUMPTION AGREEMENT
                       -----------------------------------

         THIS ASSIGNMENT AND ASSUMPTION AGREEMENT is entered into this 10th day
of November, 1995, by and between LONNIE D. FERRIN ("Seller"), and DELTA NATURAL
GAS COMPANY, INC., a Kentucky corporation ("Purchaser"). Capitalized terms used
herein and in the attachments hereto shall have the meanings set forth in the
Agreement (as defined below) unless otherwise stated herein.

                            W I T N E S S E T H:
                            - - - - - - - - - -

         THAT WHEREAS, on March 1, 1995 Seller and Purchaser entered into an
Agreement for Purchase and Sale of Assets (the "Agreement") pursuant to which
Seller agreed to transfer, assign and convey to Purchaser and Purchaser agreed
to purchase and acquire from Seller certain of the property and assets of Seller
located in Bell County, Kentucky; and

         WHEREAS, pursuant to the Agreement, Seller is willing to transfer and
assign to Purchaser and Purchaser is willing to acquire and accept from Seller
and assume all liabilities under those certain leases and agreements set forth
and described on Exhibit A attached hereto (collectively the "Leases"); and
                 ---------

         WHEREAS, subject to the terms and conditions of the Agreement, Seller
desires to now transfer and assign to Purchaser the Leases, and Purchaser
desires to accept and assume same, pursuant to and in discharge of their
respective obligations set forth in the Agreement.

         NOW, THEREFORE, for and in consideration of the performance and
observance of the terms and conditions contained herein and set forth in the
Agreement, the terms and conditions of which are incorporated herein by
reference, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Seller does hereby sell, transfer
and assign to Purchaser, its successors and assigns, all of Seller's right,
title and interest in and to the Leases. Seller will WARRANT SPECIALLY its title
to the Leases. It is agreed and acknowledged that this Assignment shall be
governed by and construed in accordance with the terms and conditions of the
Agreement.

                                    19

<PAGE>
<PAGE>

         Purchaser does hereby accept the transfer and assignment of the Leases
made herein and does hereby assume same and agree to pay or discharge when due
and perform in full all of Seller's duties and obligations under the Leases
arising on or after the date hereof.

         IN WITNESS WHEREOF, the parties have executed this Assignment and
Assumption Agreement on this the day and year first above written.

                                            "SELLER"

                                            /s/ LONNIE D. FERRIN
                                            --------------------------
                                            LONNIE D. FERRIN

                                            "PURCHASER"
                                            DELTA NATURAL GAS COMPANY, INC.,
                                            a Kentucky corporation

                                            BY: /s/ GLENN R. JENNINGS
                                               --------------------------

                                            ITS: President & CEO
                                                --------------------------

STATE OF KENTUCKY)

COUNTY OF JEFFERSON)

         The foregoing Agreement was subscribed, sworn to and acknowledged
before me this 10th day of November, 1995, by Lonnie D. Ferrin.

         My Commission Expires: 4-15-98
                               ---------

                                            Suzan N. Ellis
                                            --------------------------
                                            NOTARY PUBLIC

                                    20

<PAGE>
<PAGE>

STATE OF KENTUCKY)

COUNTY OF JEFFERSON)

         The foregoing Agreement was subscribed, sworn to and acknowledged
before me this 10th day of November, 1995, by Glen Jennings as President of
Delta Natural Gas Company, Inc., a Kentucky corporation, for and on behalf
of the corporation.

         My Commission Expires: 4-15-98
                               ---------

                                            Suzan N. Ellis
                                            --------------------------
                                            NOTARY PUBLIC

                                    21

<PAGE>
<PAGE>

THIS INSTRUMENT PREPARED BY:

STOLL, KEENON & PARK
201 E. Main Street
Suite 1000
Lexington, Kentucky 40507
(606) 231-3000

BY: /s/ J. Mel Camenisch, Jr.
   --------------------------
   J. Mel Camenisch, Jr.

                                    22

<PAGE>
<PAGE>

                                    EXHIBIT A
                                    ---------

         Attachment to that certain Assignment and Assumption Agreement between
         Lonnie D. Ferrin and Delta Natural Gas Company dated November 10, 1995.

1.       Underground Gas Storage Lease and Agreement (Canada Mountain Field)
         dated March 9, 1994 by and between Equitable Resources Exploration, a
         division of Equitable Resources Energy Company, a West Virginia
         corporation, and Lonnie D. Ferrin covering approximately 3,128 acres in
         Bell County, Kentucky (unrecorded, but evidenced by a Memorandum of
         Lease at Lease Book 40, Page 580 in the Bell County Clerk's office), as
         amended by that Amendment No. 1 and Novation to Underground Storage
         Lease and Agreement (Canada Mountain Field) dated March 22, 1995 by and
         between Equitable Resources Exploration, Lonnie D. Ferrin and Delta
         Natural Gas Company and recorded in Lease Book 40, Page 832 in the
         aforesaid Clerk's office.

2.       Gas Storage Lease dated June 18, 1990 by and between J.M. Huber
         Corporation and Lonnie D. Ferrin covering approximately 5,000 acres in
         Bell County, Kentucky and recorded in Lease Book 39, Page 637 in the
         Bell County Clerk's office, as amended by that Amendment to Gas Storage
         Lease dated December 4, 1990 by and between J.M. Huber Corporation and
         Lonnie D. Ferrin and recorded in Lease Book 39, Page 643 in the
         aforesaid Clerk's office, and further amended by another Amendment to
         Gas Storage Lease dated June 8, 1995 between J.M. Huber Corporation and
         Lonnie D. Ferrin and recorded in Lease Book 40, Page 751 in the
         aforesaid Clerk's office.

3.       Oil and Gas Lease dated February 11, 1995 from Meredith J. Evans and
         Helen Evans, husband and wife, to Paddock Oil and Gas, Inc. and
         recorded in Lease Book 40, Page 494 in the Bell County Clerk's office,
         as assigned to Lonnie D. Ferrin by Assignment dated June 15, 1995 and
         recorded in Lease Book 40, Page 762 in the aforesaid Clerk's office.

4.       Oil and Gas Lease dated December 17, 1994 from Donna Evans Smith and
         Kirby Smith III, husband and wife, to Paddock Oil and Gas, Inc. and
         recorded in Lease Book 40, Page 444 in the Bell County Clerk's office,
         as assigned to Lonnie D. Ferrin by Assignment dated June 15, 1995 and
         recorded in Lease Book 40, Page 762 in the aforesaid Clerk's office.

                                    23

<PAGE>
<PAGE>

5.       Oil and Gas Lease dated March 11, 1995 from Oliver Gregory and Nell
         Gregory, husband and wife, to Paddock Oil and Gas, Inc. and recorded in
         Lease Book 40, Page 699 in the Bell County Clerk's office, as assigned
         to Lonnie D. Ferrin by Assignment dated June 15, 1995 and recorded in
         Lease Book 40, Page 762 in the aforesaid Clerk's office.

6.       Gas Storage Lease dated April 3, 1995 from Kathy Cornelius and William
         Cornelius, husband and wife, to Lonnie D. Ferrin and recorded in Lease
         Book 40, Page 719 in the Bell County Clerk's office.

7.       Oil and Gas Lease dated July 19, 1995 from Meredith J. Evans and Helen
         Evans, husband and wife, to Paddock Oil and Gas, Inc. and recorded in
         Lease Book 40, Page 775 in the Bell County Clerk's office, as assigned
         to Lonnie D. Ferrin by Assignment dated August 31, 1995 and recorded in
         Lease Book 40, Page 796 in the aforesaid Clerk's office.

8.       Oil and Gas Lease from Lizzie Freeman, widow, Troy Freeman, single, and
         Boyd Freeman and Janice Freeman, husband and wife, dated June 21, 1995
         to Paddock Oil & Gas, Inc. and recorded in Lease Book 40, Page 770 in
         the Bell County Clerk's office, as assigned to Lonnie D. Ferrin by
         Assignment dated August 31, 1995 and recorded in Lease Book 40, Page
         796 in the aforesaid Clerk's office.

                                    24

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