Document:

exv10w1

 

Exhibit 10.1

ARTICLES OF ASSOCIATION

OF FRESENIUS MEDICAL CARE AKTIENGESELLSCHAFT

I.     General Terms

ARTICLE 1

Firm Name and Registered Office

     
The Company is a stock corporation. The name of the Company is

Fresenius Medical Care

Aktiengesellschaft

     
The registered office of the Company is in Hof an der Saale.

ARTICLE 2

Purpose

     
(1) The purpose of the Company is

		
	 	     
    a) the development, production and distribution of as well
    as the trading in health care products, systems and procedures,
    including dialysis;
	 
	 	     
    b) the projecting, planning, establishment, acquisition and
    operation of health care businesses, including, but not limited
    to, dialysis centers, also in separate enterprises or through
    third parties as well as the participation in such dialysis
    centers;
	 
	 	     
    c) the development, production and distribution of other
    pharmaceutical products and the provision of services in this
    field;
	 
	 	     
    d) the provision of advice in the medical and
    pharmaceutical areas as well as the scientific information and
    documentation;
	 
	 	     
    e) the provision of laboratory services for dialysis and
    non-dialysis patients and homecare medical services.

     
The Company will operate itself or through subsidiaries at home
and abroad.

     
(2) The Company shall be entitled to enter into any and all
business transactions and take any and all measures which seem
to be necessary or useful to achieve the purpose of the Company
and may, in particular without limitation, participate in other
enterprises of the same or similar kind, take over the
management and/or the representation of such enterprises,
transfer company divisions, including essential company
divisions, to enterprises in which the Company holds an interest
and establish branches at home and abroad.

ARTICLE 3

Notifications and Publications

     
(1) All notifications of the Company shall be made in the
electronic Bundesanzeiger [Federal Gazette].

     
(2) English short versions of the notices of
shareholders’ meetings which must provide for the place,
date and time and the items on the agenda of the
shareholders’ meeting and the prerequisites of
participation in the meetings as well as English short versions
of the other notifications shall also be published in The Wall
Street

Articles of Association/May 24, 2005

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Journal and in The New York Times. With the consent of the
supervisory board which must decide unanimously on such consent,
the management board may determine deviations from this
provision.

II.     Capital Stock and Shares

ARTICLE 4

Capital Stock

     
(1) The capital stock of the Company amounts to
Euro 246,517,980.16 and is divided into seventy million
(70,000,000) bearer shares of the common stock and 26,296,086
non-voting bearer shares of the preferred stock.

		
	 	
    In case of issuance of non-voting bearer shares of the preferred
    stock, particulars thereof are set forth in Article 19.
	 
	 	
    No consent of the preferred shareholders shall be required for
    the issuance of non-voting preferred shares which, for the
    distribution of the profits or the corporate assets, will be
    equal to or be preferred to the non-voting preferred shares
    existing from time to time.

     
(2) The capital stock in the amount of DM 100,000
available at the transformation was raised through change of the
legal form of Fresenius Medical Care GmbH with registered office
in Hof an der Saale, the previous legal entity owning the assets
and liabilities of the Company.

     
(3) The management board shall be authorized, in the period
up to May 23, 2010, with the approval of the supervisory
board, to increase, on one or more occasions, the capital of the
company by up to a total of EUR 30,720,000.00 for cash by
the issue of new non-voting bearer preference shares (Authorized
Capital I). The number of shares has to increase in the
same proportion as the capital. The management board shall be
further authorized, with the approval of the supervisory board,
to decide on the exclusion of shareholders’ pre-emption
rights. Exclusion of pre-emption rights is admissible, however,
only for fractional amounts. The new shares may also be taken up
by financial institutions to be specified by the management
board, with the obligation to offer them to the shareholders
(indirect pre-emption rights). The management board shall be
further authorized, with the approval of the supervisory board,
to determine the further details of the implementation of the
capital increase out of Authorized Capital I. The
supervisory board shall be authorized to amend the Articles of
Association after complete or partial implementation of the
capital increase out of Authorized Capital I or after the expiry
of the authorized period in accordance with the amount of the
capital increase out of Authorized Capital I.

     
(4) The management board shall be authorized, with the
approval of the supervisory board, to increase the capital stock
of the Corporation during the period up to 22 May 2006 by a
maximum amount of Euro 20,480,000.00 through the
non-recurrent or recurrent issue of new non-voting bearer
preference shares (Authorized Capital II). The number of
shares has to increase in proportion to the capital stock. The
increases in capital may take place against cash contributions
or contributions in kind. The management board shall also be
entitled, in each case subject to the approval of the
supervisory board, to decide on an exclusion of the subscription
right of the shareholders. However, such an exclusion of the
subscription right shall only be permissible if, in case of a
capital increase against cash contributions, the issue price is
not significantly lower than the stock exchange price, and/or,
in case of a capital increase against contributions in kind, the
purpose of such increase is to acquire an enterprise or an
interest in an enterprise.

     
(5) The capital stock of the Corporation is contingently
increased by a maximum of Euro 5,628,725.76 divided into a
maximum of 2,198,721 par value shares, through the issue of new,
non-voting bearer preference shares. The conditional capital
increase will be made only to the extent that the holders of the
convertible bonds issued by Fresenius Medical Care
Aktiengesellschaft on the basis of the authority of the
shareholders’ meeting of September 24, 1996 will
exercise their rights to convert the bonds into new shares. The
new shares

Articles of Association/May 24, 2005

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will participate in the profits as from the beginning of the
business year in which they are created as a result of exercise
of conversion rights.

     
(6) The capital stock of the Corporation is contingently
increased by a maximum of Euro 2,848,235.52 divided into a
maximum of 1,112,592 par value shares, through the issue of new,
non-voting bearer preference shares. The conditional capital
increase will be made only to the extent that subscription
rights are granted pursuant to the stock option program in
accordance with the resolution passed at the shareholders’
meeting of June 10, 1998, and of the resolution of the
shareholders’ meeting of May 30, 2000, and the owners
of the subscription rights exercise their subscription rights.
The new non-voting bearer shares of the preferred stock will
participate in the profits as from the beginning of the business
year in which issuance occurs.

     
(7) The capital stock of the Corporation is contingently
increased by a maximum of Euro 10,215,170.56 divided into a
maximum of 3,990,301 non-voting bearer preference shares,
through the issue of new non-voting bearer preference shares in
order to secure the convertible bonds adopted by resolution in
the general meeting of 23 May 2001. The contingent capital
increase shall only take place insofar as convertible bonds for
par value shares are issued according to the international
participation scheme for employees pursuant to the resolution of
the general meeting of 23 May 2001 and insofar as the
holders of such convertible bonds exercise their conversion
right. The new non-voting bearer preference shares shall
participate in profits as of the start of the fiscal year in
which they are issued.

     
(8) In case of a capital increase, the profit participation
may be determined in derogation of Section 60, para. 2
AktG [German Corporation Law].

ARTICLE 5

Shares

     
(1) The shares will be no par value bearer shares.

     
(2) The Company shall be entitled to issue share
certificates made out to bearer each evidencing a plurality of
shares (several-share certificates).

     
(3) The form of the share certificates and of the dividend
coupons and renewal coupons shall be determined by the
management board with the consent of the supervisory board.

     
(4) The Company shall take the necessary measures to
achieve that its shares will, as far as possible, be admitted
for official quotation on the stock exchange in Frankfurt am
Main and in suitable form — e.g. as “American
Depositary Shares” — on the New York Stock
Exchange and that such admissions will be maintained. With the
consent of the supervisory board which must decide unanimously
on such consent, the management board may determine deviations
from this provision.

III.     Constitution of the
Company

A. Management Board

ARTICLE 6

Composition

     
(1) The management board shall consist of at least two
(2) persons. The supervisory board may provide for a
greater number. The supervisory board may also appoint deputy
management board members.

     
(2) The resolutions of the management board shall be
adopted by a simple majority of the votes unless otherwise
required by law. If a chairman of the management board has been
appointed, he shall have the casting vote in case of a tie.

Articles of Association/May 24, 2005

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ARTICLE 7

Representation of the Company

     
(1) The Company shall be represented by two
(2) members of the management board or by one
(1) member of the management board jointly with a
“Prokurist”. Until the entry of one or more further
management board members, the Company will be represented by one
management board member alone. The power of prokura is to be
granted only as joint power of prokura subject to the
restrictions referred to in Article 7 (3) below.

     
(2) The supervisory board may grant the right of individual
representation to individual or several management board members
and revoke such right at any time. The supervisory board may
appoint a chairman of the management board.

     
(3) The express prior consent of the supervisory board
shall be required for the following:

		
	 	     
    a) acquisition, alienation or encumbrance of real estate
    and equivalent rights if and to the extent that, in the
    individual case, an amount of Euro 5,000,000 or, in case of
    encumbrance, the security for the allowed credit line is
    exceeded;
	 
	 	     
    b) acquisition, establishment, alienation of or charges on
    shareholdings in other enterprises if and to the extent that an
    amount of Euro 5,000,000 is exceeded in the individual case;
	 
	 	     
    c) starting of new, and the discontinuance of existing,
    lines of business or establishments;
	 
	 	     
    d) conclusion of any legal transaction of the Company with
    or toward another undertaking holding the majority of the shares
    in the Company within the meaning of Section 16 AktG or
    with or toward an enterprise affiliated with such undertaking
    within the meaning of Section 15 AktG if and when such
    legal transaction is beyond the ordinary course of business or
    the amount involved in such legal transaction exceeds
    Euro 3,000,000.
	 
	 	     
    e) consenting to the performance of any of the above legal
    acts by an affiliated company.
	 
	 	     
    f) conclusion, modification or termination of contracts
    between business enterprises within the meaning of
    Sections 291 et seq. AktG.

     
(4) Notwithstanding the overall responsibility of the
management board, the supervisory board shall, in particular in
rules of procedure for the management board, assign the
management board duties to the individual management board
members and, within the framework of the imperative legal
provisions and the Articles of Association, determine the
relations of the management board members among each other and
with the Company and, in extension of Article 7
(3) above, define the acts for which the management board
shall require the express prior consent of the supervisory
board. The supervisory board may give consents pursuant to
Article 7 (3) above also generally, with or without
time limit and also to individual members of the management
board, in particular, the chairman of the management board. The
supervisory board may, at any time, extend, restrict or revoke
the rules of procedure for the management board.

B. Supervisory Board

ARTICLE 8

Election and Term of Office of the Supervisory Board

     
(1) The supervisory board consists of six (6) members.

		
	 	
    All six (6) members shall be elected by the
    shareholders’ meeting according to the provisions of the
    German Aktiengesetz.

Articles of Association/May 24, 2005

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(2) Unless expressly otherwise resolved by the
shareholders’ meeting, the supervisory board members shall
be appointed to hold office until the end of the ordinary
shareholders’ meeting which resolves on the exoneration for
the fourth business year after commencement of the term of
office. The year in which the term of office commences shall not
be considered for this calculation. Reelection of supervisory
board members shall be permissible.

     
(3) If a member elected by the shareholders’ meeting
withdraws from the supervisory board before expiration of his
term of office, a new member is to be elected in the next
shareholders’ meeting to replace the withdrawing member.
The newly elected member shall hold office for the remaining
term of office of the withdrawing member.

     
(4) The shareholders’ meeting may, for the supervisory
board members to be elected by it, appoint substitute members
who will become members of the supervisory board on the basis of
a specific order to be determined upon election if and when
supervisory board members withdraw before expiration of their
term of office. Their position as substitute members shall
revive if and when the shareholders’ meeting elects a new
member instead of the withdrawing supervisory board member
replaced by such substitute member. The term of office of the
substitute member shall end upon completion of the
shareholders’ meeting in which an election according to
Article 8 (3) is made.

     
(5) Each member of the supervisory board may resign from
office by giving one month’s written notice to the chairman
of the supervisory board even without good cause. Notice of
resignation from office by the chairman of the supervisory board
shall be given to his deputy.

ARTICLE 9

Constitution of the Supervisory Board

     
(1) Following the shareholders’ meeting in which the
supervisory board has been newly elected, the supervisory board
shall hold a meeting without special notice of meeting and,
where necessary, shall elect in such meeting from among its
members a chairman and a deputy chairman for the whole term of
office of the elected persons as supervisory board members.

     
(2) If the chairman or his deputy resigns his office before
expiration of his term of office, the supervisory board shall
immediately hold a new election to replace the resigning
chairman/ deputy.

ARTICLE 10

Meetings and Resolutions of the Supervisory Board

     
(1) The meetings of the supervisory board shall be called
by the chairman by notice subject to a notice period of fourteen
(14) days. The meetings may be called in writing, by
telefax or by other electronic means of communication. The
invitation on the agenda must be stated in the notice of
meeting. Notwithstanding sentence 2, in urgent cases, this
period may be shortened and the meeting may be called by
telegram, telex or telephone.

     
(2) The meetings of the supervisory board shall in the
regular case be by personal attendance. It is, however,
admissible that meetings of the supervisory board be held by way
of a video conference or that individual supervisory board
members participate by way of video link, provided that in these
cases the passing of resolutions also takes place by the way of
a video conference or video link. Outside of meetings,
resolutions in writing, telegraph, telefax, telex, telephone or
electronic communication (e-mail etc.) are admissible, if this
is ordered by the chairman of the supervisory board, or in the
event of his being unable to act, by his deputy.

     
(3) The supervisory board shall constitute a quorum if half
the members making up the entire board take part in the adoption
of the resolution. Those items on the agenda which have not been
announced

Articles of Association/May 24, 2005

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properly within the meaning of para. (1) above may be voted
on only if none of the present members objects thereto.

     
(4) If members of the supervisory board are prevented from
attending the meeting, they may have another member of the
supervisory board submit their written votes. Such delivery of
the written vote shall be deemed to be participation in the
adoption of the resolution.

     
(5) Resolutions of the supervisory board shall require the
majority of the votes cast unless otherwise provided by law or
the Articles of Association. In case of a tie, a new vote shall
be taken on the same issue at the request of the chairman of the
supervisory board or of another member of the supervisory board.
In the event that such new vote leads again to a tie, the
chairman of the supervisory board shall have two (2) votes
(to the legally permissible extent, this shall apply also to
committees of the supervisory board of which he is a member).
Article 10 (4) shall be applicable to the casting of
the second vote. The deputy of the chairman of the supervisory
board shall not be entitled to such second vote.

     
(6) Minutes of the meetings of the supervisory board shall
be prepared and translated into the English language. The
minutes shall be signed by the chairman of the meeting. Any
minutes to be prepared outside of the meeting by personal
attendance (“Präsenzsitzung”), as outlined in sub
paragraph 2 with respect to resolutions shall be signed by
the chairman of the supervisory board.

ARTICLE 11

Rights and Duties of the Supervisory Board

     
(1) The supervisory board shall have the rights and duties
defined by imperative legal provisions and these Articles of
Association.

     
(2) The supervisory board shall, at any time, have the
right to supervise the entire management of the management board
and to inspect and audit all books and records, including the
minutes of the meetings of the management board, as well as the
assets of the Company. This right to inspect and audit can also
be claimed by any individual supervisory board member. The
supervisory board member must direct his request to the chairman
of the supervisory board who shall pass the request on to the
management board or, if a chairman of the management board has
been appointed (Art. 7 (2) sentence 2), to such
chairman.

     
(3) The management board shall regularly report to the
supervisory board. In addition, the supervisory board may
request the submission of a report if and when there is
reasonable cause therefor including where such cause relates to
a business event at an affiliated company which has become known
to the management board and which may substantially influence
the situation of the Company. Article 11 (2),
sentences 2 and 3 apply mutatis mutandis with the proviso,
that the report can only be given to the supervisory board.

     
(4) The supervisory board shall issue rules of procedure
for the management board in accordance with
Article 7 (4).

     
(5) The supervisory board shall be entitled, without
resolution of the shareholders’ meeting, to make any
amendments to the Articles of Association which concern only the
wording.

ARTICLE 12

Rules of Procedure of the Supervisory Board

     
The supervisory board shall, within the framework of the
imperative legal provisions and the Articles of Association,
establish rules of procedure for itself which shall take into
account, in particular, the interests of those supervisory board
members who do not speak German.

Articles of Association/May 24, 2005

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ARTICLE 13

Remuneration of Supervisory Board Members

     
(1) The members of the supervisory board shall be
reimbursed for the expenses incurred in the exercise of their
office, including any value-added tax.

     
(2) Each member of the Supervisory Board shall receive a
fixed fee of US$80,000.00 per annum for each full fiscal year,
payable in four equal installments at the end of each calendar
quarter.

		
	 	
    In the event that the shareholders’ meeting, taking into
    consideration the annual results, resolves a higher remuneration
    by a three fourths majority of the votes cast, such higher
    remuneration shall be payable.

     
(3) If a business year is no complete calendar year, the
remuneration shall be paid on a pro rata temporis basis.
The chairman of the supervisory board shall receive twice the
remuneration of a supervisory board member, and his deputy shall
receive one and a half times the remuneration of a supervisory
board member.

     
(4) As a member of a Committee, a Supervisory Board member
shall receive, in addition, US$30,000.00 per year, or as
Chairman of a committee, US$50,000.00 per year, payable in each
case in four equal installments at the end of each calendar
quarter.

     
(5) The Company shall pay the remuneration of the
supervisory board members subject to statutory deductions.

C. Shareholders’ Meeting

ARTICLE 14

Calling of the Shareholders’ Meeting

     
(1) The shareholders’ meeting shall be called, in so
far as no shorter period is allowed by law, no later than one
month before the day by the end of which the shares must be
deposited according to Article 15 of these Articles of
Association with the day of calling and the day of deposit not
to be considered for such calculation.

     
(2) No later than on the last day of the convocation
period, also the English short version pursuant to
Article 3 (2) shall be published.

     
(3) The shareholders’ meeting shall be held at the
place where the registered office of the Company is located, or
in a German city where a stock exchange is situated or at the
place where the registered office of a domestic affiliated
company is located.

ARTICLE 15

Attendance at the Shareholders’ Meeting

     
(1) Those shareholders shall be entitled to attend the
shareholders’ meeting who deposit their shares no later
than on the fifth day before the shareholders’ meeting with
the Company, or a Notary in the Federal Republic of Germany, or
a Wertpapiersammelbank [bank for the central depository of
securities] or with any other body designated in the notice of
meeting, during the business hours until the end of the
shareholders’ meeting. If the credit institutions are
closed on the last day of deposit, the period of deposit shall
end on the preceding working day of the credit institutions.

     
(2) If the shares are deposited with a German Notary or
with a Wertpapiersammelbank, the certificate to be issued by
them shall be submitted to the cash office of the Company no
later than on the first working day, except the Saturday, after
expiration of the period of deposit.

Articles of Association/May 24, 2005

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(3) Shares shall be deemed to have been properly deposited
if they are blocked until the end of the shareholders’
meeting at a credit institution in the name of and with the
consent of a depository.

     
(4) The members of the management board and of the
supervisory board should personally attend the
shareholders’ meeting. If it is not possible for a member
of the supervisory board to attend at the place of the
shareholders’ meeting, in particular, because he is abroad
for cause, he may participate in the shareholders’ meeting
by sound and picture transmission.

     
(5) If a voting right is to be exercised by a proxy,
authorization in writing [“Textform”] shall be
sufficient.

ARTICLE 16

Date of the Ordinary Shareholders’ Meeting

     
The shareholders’ meeting which accepts the adopted annual
financial statement or, as the case may be, resolves on the
adoption of the annual financial statement and on the approval
of the actions of the management board and the supervisory board
and on the disposition of the profits (ordinary
shareholders’ meeting) shall be held within the first eight
(8) months of a business year.

ARTICLE 17

Chairmanship at the Shareholders’ Meeting and Voting

     
(1) The shareholders’ meeting shall be chaired by the
chairman of the supervisory board or, if he is prevented or at
the request of the chairman of the supervisory board, by another
supervisory board member to be designated by the chairman of the
supervisory board. If and when no such designation has been made
and the chairman of the supervisory board is prevented, another
member to be designated by the supervisory board shall preside
over the shareholders’ meeting.

     
(2) The chairman shall chair the meeting, determine the
order of items to be dealt with as well as the kind and form of
the voting.

     
(3) The majorities of the votes cast and of the capital
stock represented for the adoption of the resolution which are
required for the resolutions of the shareholders’ meeting
shall be governed by the statutory provisions. In case of a tie,
a motion shall be deemed denied.

     
(4) Each share of the common stock shall grant one
(1) vote in the shareholders’ meeting. The preferred
shares shall be non-voting, unless otherwise required by
imperative legal provisions; otherwise, sentence 1 of this
paragraph shall apply mutatis mutandis.

     
(5) The chairman can decide that the entire
shareholders’ meeting or extracts therefrom be transmitted
in sound and picture. Such transmission can even be in a form to
which the public has unlimited access. The form of the
transmission should be made known in the invitation.

IV.     Annual Financial Statement
and Disposition of Profits

ARTICLE 18

Business Year, Rendering of Accounts

     
(1) The business year shall be the calendar year.

     
(2) Within the first three (3) months of the business
year but no later than within the maximum period required by
imperative legal provisions, the management board shall prepare
the annual financial statement and the management report for the
preceding business year and submit the same to the auditors.

Articles of Association/May 24, 2005

8

 

     
(3) Immediately after receipt of the auditor’s report,
the management board shall submit to the supervisory board the
annual financial statement, the management report and the
auditor’s report.

     
(4) At the same time, the management board shall submit to
the supervisory board the proposal which he intends to make to
the shareholders’ meeting in respect of the disposition of
profits.

     
(5) Sub paragraphs 2 and 3 shall apply
corresponding to group financial statements and to report on the
economic group position, as far as § 170 sub
paragraph 1 sentence 2 AktG is applicable to the
Company as Mother Company.

ARTICLE 19

Disposition of Profits

     
(1) The shareholders’ meeting shall resolve on the
disposition of the balance sheet profits subject to the
following paragraphs (2) to (4) of this Article.

     
(2) Out of the annual balance sheet profits, the non-voting
preferred shares (Article 4) shall receive a dividend which
exceeds that for the common shares by an amount of
Euro 0.06 per preferred share, but at least a dividend in
an amount of Euro 0.12 per preferred share.

     
(3) The minimum dividend of Euro 0.12 per preferred
share shall take precedence over the distribution of a dividend
on the common shares.

     
(4) In the event that the balance sheet profits for one or
more business years are insufficient to distribute
Euro 0.12 per preferred share, the lacking sums shall be
paid subsequently without interest out of the balance sheet
profits for the following business years, i.e. after
distribution of the minimum dividend on the preferred shares for
these business years and before distribution of a dividend on
the common shares. The right to subsequent payment shall be part
of the profit share for the business year from the balance sheet
profits of which the subsequent payment on the preferred shares
is made.

V.     Formation Expenses

ARTICLE 20

Formation Expenses

     
The formation expenses (Notary’s fees, court costs, costs
of notification) amount up to DM 5,000 (in words: five
thousand German Marks).

Articles of Association/May 24, 2005

9EXHIBIT 10.15

THIS  WARRANT  AND  THE  SHARES  OF  COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT  HAVE  NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR  ANY  STATE SECURITIES LAWS.  THIS WARRANT AND THE COMMON STOCK ISSUABLE UPON
EXERCISE  OF  THIS  WARRANT  MAY  NOT  BE  SOLD,  OFFERED  FOR  SALE, PLEDGED OR
HYPOTHECATED  IN  THE  ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS
WARRANT UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF
COUNSEL  REASONABLY  SATISFACTORY  TO  NEW  CENTURY  ENERGY  CORP.  THAT  SUCH
REGISTRATION  IS  NOT  REQUIRED.

            Right to Purchase up to 900,000 Shares of Common Stock of
                            New Century Energy Corp.
                   (subject to adjustment as provided herein)

                          COMMON STOCK PURCHASE WARRANT

No.                                                  Issue Date:   June 30, 2005
   --------------------

     NEW  CENTURY  ENERGY  CORP.,  a corporation organized under the laws of the
State  of  Colorado  (the "Company"), hereby certifies that, for value received,
ENERGY CAPITAL SOLUTIONS, LP or assigns (the "Holder"), is entitled,  subject to
the terms set forth below, to purchase from the Company (as defined herein) from
and after the Issue Date of this Warrant and at any  time  or  from time to time
before 5:00 p.m., Houston  time,  through  the  close  of business June 30, 2008
(the "Expiration  Date"), up to 900,000 fully paid and  nonassessable  shares of
Common  Stock  (as hereinafter defined),  $0.001 par  value per  share,  at  the
applicable Exercise Price per share (as defined below). The number and character
of such shares  of  Common Stock and the applicable Exercise Price per share are
subject to adjustment  as  provided  herein.

     As  used herein the following terms, unless the context otherwise requires,
have the following respective meanings:

               (a) "Company" means New Century Energy Corp. and any person or
          entity which shall succeed, or assume the obligations of, New Century
          Energy Corp. hereunder.

               (b)  "Common  Stock"  means  (i)  the Company's Common Stock, par
          value  $0.001  per  share; and (ii) any other securities into which or
          for  which any of the securities described in the preceding clause (i)
          may  be converted or exchanged pursuant to a plan of recapitalization,
          reorganization, merger, sale of assets or otherwise.

               (c)  "Exercise  Price" means a price of $0.80 per share of Common
          Stock.

               (d)  "Other Securities" means any stock (other than Common Stock)
          and  other securities of the Company or any other person (corporate or
          otherwise)  which  the  holder  of  the  Warrant  at any time shall be
          entitled  to  receive,  or shall have received, on the exercise of the
          Warrant,  in  lieu  of or in addition to Common Stock, or which at any
          time shall be issuable or shall have been issued in exchange for or in
          replacement  of Common Stock or Other Securities pursuant to Section 4
          or otherwise.

<PAGE>

     1. Exercise of Warrant.
       ---------------------

          1.1  Number  of Shares Issuable upon Exercise. From and after the date
               ----------------------------------------
     hereof  through  and  including  the  Expiration  Date, the Holder shall be
     entitled  to receive, upon exercise of this Warrant in whole or in part, by
     delivery  of  an  original  or  fax  copy of an exercise notice in the form
     attached  hereto  as  Exhibit  A  (the "Exercise Notice"), shares of Common
     Stock of the Company, subject to adjustment pursuant to Section 4.

          1.2 Fair Market Value. For purposes hereof, the "Fair Market Value" of
              -----------------
     a  share of Common Stock as of a particular date (the "Determination Date")
     shall mean:

               (a) If the Company's Common Stock is traded on the American Stock
          Exchange  or another national exchange or is quoted on the National or
          SmallCap  Market of The Nasdaq Stock Market, Inc. ("Nasdaq"), then the
          closing  or  last  sale  price,  respectively,  reported  for the last
          business day immediately preceding the Determination Date.

               (b)  If  the Company's Common Stock is not traded on the American
          Stock  Exchange  or  another national exchange or on the Nasdaq but is
          traded  on  the NASD Over the Counter Bulletin Board, then the mean of
          the  average of the closing bid and asked prices reported for the last
          business day immediately preceding the Determination Date.

               (c)  Except  as  provided  in  clause (d) below, if the Company's
          Common  Stock  is  not  publicly  traded,  then  as the Holder and the
          Company  agree  or  in  the  absence  of  agreement  by arbitration in
          accordance  with  the rules then in effect of the American Arbitration
          Association,  before  a single arbitrator to be chosen from a panel of
          persons  qualified  by education and training to pass on the matter to
          be decided.

               (d)  If  the  Determination  Date  is  the date of a liquidation,
          dissolution  or  winding  up, or any event deemed to be a liquidation,
          dissolution  or winding up pursuant to the Company's charter, then all
          amounts  to  be  payable  per  share  to  holders  of the Common Stock
          pursuant  to the charter in the event of such liquidation, dissolution
          or  winding  up,  plus  all  other  amounts to be payable per share in
          respect of the Common Stock in liquidation under the charter, assuming
          for  the  purposes of this clause (d) that all of the shares of Common
          Stock  then  issuable  upon exercise of the Warrant are outstanding at
          the Determination Date.

          1.3  Company  Acknowledgment.  The  Company  will,  at the time of the
               -----------------------
     exercise of this Warrant, upon the request of the Holder hereof acknowledge
     in writing its continuing obligation to afford to such Holder any rights to
     which  such  Holder  shall  continue  to be entitled after such exercise in
     accordance with the provisions of this Warrant. If the Holder shall fail to
     make  any  such  request,  such  failure  shall  not  affect the continuing
     obligation of the Company to afford to such Holder any such rights.

<PAGE>

          1.4  Trustee  for  Warrant  Holders. In the event that a bank or trust
               ------------------------------
     company  shall  have  been  appointed  as  trustee  for the Holders of this
     Warrant  pursuant  to Subsection 3.2, such bank or trust company shall have
     all the powers and duties of a warrant agent (as hereinafter described) and
     shall  accept,  in  its  own  name  for  the account of the Company or such
     successor  person as may be entitled thereto, all amounts otherwise payable
     to  the  Company or such successor, as the case may be, on exercise of this
     Warrant pursuant to this Section 1.

     2. Procedure for Exercise.
        ----------------------

          2.1  Delivery  of  Stock  Certificates, Etc., on Exercise. The Company
               ----------------------------------------------------
     agrees  that  the  shares  of  Common Stock purchased upon exercise of this
     Warrant  shall  be deemed to be issued to the Holder as the record owner of
     such  shares  as of the close of business on the date on which this Warrant
     shall  have  been  surrendered  and  payment  shall have been made for such
     shares in accordance herewith. As soon as practicable after the exercise of
     this Warrant in full or in part, and in any event within three (3) business
     days thereafter, the Company at its expense (including the payment by it of
     any  applicable  issue  taxes)  will  cause to be issued in the name of and
     delivered  to the Holder, or as such Holder (upon payment by such Holder of
     any  applicable  transfer  taxes)  may direct in compliance with applicable
     securities  laws,  a certificate or certificates for the number of duly and
     validly  issued,  fully  paid  and nonassessable shares of Common Stock (or
     Other  Securities) to which such Holder shall be entitled on such exercise,
     plus,  in lieu of any fractional share to which such Holder would otherwise
     be entitled, cash equal to such fraction multiplied by the then Fair Market
     Value  of one full share, together with any other stock or other securities
     and  property  (including  cash,  where applicable) to which such Holder is
     entitled upon such exercise pursuant to Section 1 or otherwise.

          2.2  Exercise. Payment shall be made either in cash or by certified or
               --------
     official  bank  check  payable  to  the  order  of the Company equal to the
     applicable  aggregate  Exercise  Price  for  the  number  of  Common Shares
     specified  in  such  Exercise  Notice  (as  such  exercise  number shall be
     adjusted  to reflect any adjustment in the total number of shares of Common
     Stock  issuable to the Holder per the terms of this Warrant) and the Holder
     shall  thereupon  be  entitled  to  receive  the number of duly authorized,
     validly  issued,  fully-paid  and non-assessable shares of Common Stock (or
     Other Securities) determined as provided herein.

     3. Effect of Reorganization, Etc.; Adjustment of Exercise Price.
        -------------------------------------------------------------

          3.1 Reorganization, Consolidation, Merger, Etc. In case at any time or
              ------------------------------------------
     from  time  to  time  the  Company  shall  (a) effect a reorganization, (b)
     consolidate  with  or  merge  into any other person, or (c) transfer all or
     substantially all of its properties or assets to any other person under any
     plan  or arrangement contemplating the dissolution of the Company, then, in
     each  such  case, as a condition to the consummation of such a transaction,
     proper  and  adequate  provision  shall  be made by the Company whereby the
     Holder,  on  the exercise hereof as provided in Section 1 at any time after
     the  consummation  of  such  reorganization, consolidation or merger or the
     effective  date  of such dissolution, as the case may be, shall receive, in
     lieu  of  the  Common Stock (or Other Securities) issuable on such exercise
     prior  to  such  consummation  or  such effective date, the stock and other
     securities  and  property  (including cash) to which such Holder would have
     been  entitled  upon  such  consummation  or  in  connection  with  such
     dissolution,  as  the  case  may  be,  if such Holder had so exercised this
     Warrant,  immediately  prior  thereto,  all  subject  to further adjustment
     thereafter as provided in Section 4

<PAGE>

          3.2  Dissolution.  In  the  event  of  any  dissolution of the Company
               -----------
     following  the  transfer  of  all or substantially all of its properties or
     assets, the Company, concurrently with any distributions made to holders of
     its  Common Stock, shall at its expense deliver or cause to be delivered to
     the  Holder  the  stock  and other securities and property (including cash,
     where  applicable) receivable by the Holder pursuant to Section 3.1, or, if
     the  Holder  shall  so  instruct  the  Company,  to a bank or trust company
     specified by the Holder (the "Trustee").

          3.3  Continuation  of  Terms.  Upon any reorganization, consolidation,
               -----------------------
     merger or transfer (and any dissolution following any transfer) referred to
     in this Section 3, this Warrant shall continue in full force and effect and
     the  terms  hereof  shall  be  applicable  to the shares of stock and other
     securities  and  property  receivable on the exercise of this Warrant after
     the  consummation  of  such  reorganization, consolidation or merger or the
     effective  date of dissolution following any such transfer, as the case may
     be,  and  shall  be  binding  upon  the  issuer  of any such stock or other
     securities,  including,  in  the  case  of  any  such  transfer, the person
     acquiring  all  or  substantially  all  of  the properties or assets of the
     Company,  whether or not such person shall have expressly assumed the terms
     of  this  Warrant  as provided in Section 4. In the event this Warrant does
     not  continue  in  full  force  and  effect  after  the consummation of the
     transactions described in this Section 3, then the Company's securities and
     property  (including  cash, where applicable) receivable by the Holder will
     be delivered to the Holder or the Trustee as contemplated by Section 3.2.

     4.  Extraordinary  Events  Regarding  Common  Stock.  In the event that the
         -----------------------------------------------
Company  shall  (a) issue additional shares of the Common Stock as a dividend or
other  distribution on outstanding Common Stock or any preferred stock issued by
the  Company,  (b)  subdivide  its  outstanding  shares  of Common Stock, or (c)
combine  its  outstanding  shares  of  the Common Stock into a smaller number of
shares  of the Common Stock, then, in each such event, the Exercise Price shall,
simultaneously  with the happening of such event, be adjusted by multiplying the
then Exercise Price by a fraction, the numerator of which shall be the number of
shares  of  Common  Stock  outstanding  immediately  prior to such event and the
denominator  of  which shall be the number of shares of Common Stock outstanding
immediately  after  such  event, and the product so obtained shall thereafter be
the  Exercise Price then in effect. The Exercise Price, as so adjusted, shall be
readjusted  in  the  same  manner  upon the happening of any successive event or
events  described herein in this Section 4. The number of shares of Common Stock
that  the Holder shall thereafter, on the exercise hereof as provided in Section
1,  be  entitled  to  receive  shall  be  adjusted  to  a  number  determined by
multiplying  the  number of shares of Common Stock that would otherwise (but for
the  provisions of this Section 4) be issuable on such exercise by a fraction of
which  (a) the numerator is the Exercise Price that would otherwise (but for the
provisions  of  this  Section  4)  be  in effect, and (b) the denominator is the
Exercise  Price  in effect on the date of such exercise (taking into account the
provisions of this Section 4).

     5.  Certificate  as  to  Adjustments.  In  each  case  of any adjustment or
         --------------------------------
readjustment in the shares of Common Stock (or Other Securities) issuable on the
exercise  of  this  Warrant,  the Company at its expense will promptly cause its
Chief Financial Officer or other appropriate designee to compute such adjustment
or  readjustment  in  accordance  with  the  terms of this Warrant and prepare a

<PAGE>

certificate  setting forth such adjustment or readjustment and showing in detail
the  facts  upon  which  such  adjustment  or readjustment is based, including a
statement of (a) the consideration received or receivable by the Company for any
additional shares of Common Stock (or Other Securities) issued or sold or deemed
to  have been issued or sold, (b) the number of shares of Common Stock (or Other
Securities)  outstanding or deemed to be outstanding, and (c) the Exercise Price
and  the  number  of shares of Common Stock to be received upon exercise of this
Warrant,  in  effect immediately prior to such adjustment or readjustment and as
adjusted  or  readjusted as provided in this Warrant. The Company will forthwith
mail  a copy of each such certificate to the Holder and any Warrant agent of the
Company (appointed pursuant to Section 11 hereof).

     6. Reservation of Stock, Etc., Issuable on Exercise of Warrant. The Company
        -----------------------------------------------------------
will  at  all times reserve and keep available, solely for issuance and delivery
on  the  exercise  of this Warrant, shares of Common Stock (or Other Securities)
from time to time issuable on the exercise of this Warrant.

     7.  Assignment;  Exchange of Warrant. Subject to compliance with applicable
         --------------------------------
securities  laws,  this  Warrant,  and  the  rights  evidenced  hereby,  may  be
transferred  by  any  registered  holder  hereof (a "Transferor") in whole or in
part.  On  the  surrender  for  exchange  of this Warrant, with the Transferor's
endorsement  in  the  form  of  Exhibit  B  attached  hereto  (the  "Transferor
Endorsement  Form")  and  together  with evidence reasonably satisfactory to the
Company  demonstrating  compliance  with applicable securities laws, which shall
include,  without  limitation,  the  provision  of  a  legal  opinion  from  the
Transferor's  counsel  (at  the  Company's expense) that such transfer is exempt
from the registration requirements of applicable securities laws, the Company at
its  expense  (but  with  payment  by  the Transferor of any applicable transfer
taxes) will issue and deliver to or on the order of the Transferor thereof a new
Warrant  of  like  tenor, in the name of the Transferor and/or the transferee(s)
specified  in such Transferor Endorsement Form (each a "Transferee"), calling in
the  aggregate  on  the face or faces thereof for the number of shares of Common
Stock  called  for  on  the  face  or faces of the Warrant so surrendered by the
Transferor.

     8.  Replacement  of Warrant. On receipt of evidence reasonably satisfactory
         -----------------------
to  the  Company  of  the loss, theft, destruction or mutilation of this Warrant
and,  in  the  case  of  any such loss, theft or destruction of this Warrant, on
delivery  of  an indemnity agreement or security reasonably satisfactory in form
and  amount  to the Company or, in the case of any such mutilation, on surrender
and  cancellation  of  this Warrant, the Company at its expense will execute and
deliver, in lieu thereof, a new Warrant of like tenor.

     9.  Registration Rights. The Company agrees that if, at any time during the
         -------------------
three  year  period,  beginning  on the date first written above, it proposes to
file  a  registration  statement  with  respect  to  any  class  of  equity  or
equity-related  security  (other  than  in  connection  with  an offering to the
Company's  employees  or  in  connection  with an acquisition, merger or similar
transaction)  under  the  Securities  Act  of  1933 in a primary registration on
behalf of the Company and/or in a secondary registration on behalf of holders of
such  securities  and  the  registration  form  to  be  used  may  be  used  for
registration  of  the  shares,  the  Company  will give prompt written notice to
Holder  of  its  intention  to  file  a registration statement and will offer to
include  in  such registration statement, such number of the shares with respect
to  which the Company has received written requests for inclusion therein within
Twenty  (20) days after the giving of notice by the Company. This Section is not
applicable  to a registration statement filed by the Company on Forms S-4 or S-8
or any successor forms.

<PAGE>

     10.  Warrant Agent. The Company may, by written notice to the Holder of the
          -------------
Warrant,  appoint  an  agent  for  the purpose of issuing Common Stock (or Other
Securities)  on  the  exercise of this Warrant pursuant to Section 1, exchanging
this  Warrant  pursuant  to  Section  7,  and replacing this Warrant pursuant to
Section  8,  or any of the foregoing, and thereafter any such issuance, exchange
or replacement, as the case may be, shall be made at such office by such agent.

     11.  Transfer  on the Company's Books. Until this Warrant is transferred on
          --------------------------------
the  books of the Company, the Company may treat the registered Holder hereof as
the  absolute  owner  hereof for all purposes, notwithstanding any notice to the
contrary.

     12.  Notices, Etc. All notices and other communications from the Company to
          ------------
the  Holder shall be mailed by first class registered or certified mail, postage
prepaid, at such address as may have been furnished to the Company in writing by
such  Holder or, until any such Holder furnishes to the Company an address, then
to,  and  at  the address of, the last Holder who has so furnished an address to
the Company.

     13. Miscellaneous. This Warrant and any term hereof may be changed, waived,
         -------------
discharged  or  terminated  only by an instrument in writing signed by the party
against  which  enforcement  of such change, waiver, discharge or termination is
sought.  THIS  WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS  OF  STATE  OF TEXAS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. ANY
ACTION BROUGHT CONCERNING THE TRANSACTIONS CONTEMPLATED BY THIS WARRANT SHALL BE
BROUGHT  ONLY  IN  THE STATE COURTS OF TEXAS OR IN THE FEDERAL COURTS LOCATED IN
THE  STATE OF TEXAS; PROVIDED, HOWEVER, THAT THE HOLDER MAY CHOOSE TO WAIVE THIS
PROVISION  AND  BRING  AN  ACTION  OUTSIDE  THE  STATE OF TEXAS. The individuals
executing  this  Warrant  on  behalf  of  the  Company  agree  to  submit to the
jurisdiction  of such courts and waive trial by jury. The prevailing party shall
be  entitled  to recover from the other party its reasonable attorneys' fees and
costs.  In  the  event  that  any  provision  of  this  Warrant  is  invalid  or
unenforceable  under  any applicable statute or rule of law, then such provision
shall  be  deemed  inoperative  to the extent that it may conflict therewith and
shall  be  deemed modified to conform with such statute or rule of law. Any such
provision  which  may  prove  invalid  or  unenforceable under any law shall not
affect  the  validity  or enforceability of any other provision of this Warrant.
The  headings  in this Warrant are for purposes of reference only, and shall not
limit or otherwise affect any of the terms hereof. The Company acknowledges that
legal  counsel  participated  in the preparation of this Warrant and, therefore,
stipulates  that  the  rule  of construction that ambiguities are to be resolved
against  the  drafting  party shall not be applied in the interpretation of this
Warrant  to  favor  any  party  against  the  other  party.

                   [BALANCE OF PAGE INTENTIONALLY LEFT BLANK;
                            SIGNATURE PAGE FOLLOWS]

<PAGE>

     IN  WITNESS  WHEREOF,  the Company has executed this Warrant as of the date
first written above.

                                     NEW CENTURY ENERGY CORP.
                                     ------------------------

                                     /s/ Edward R. DeStefano
                                     -------------------------
                                     Edward R. DeStefano
                                     President

                                     ENERGY CAPITAL SOLUTIONS, LP
                                     ----------------------------

                                     By:  /s/ Keith Behrens
                                     -------------------------
                                     Its: Managing Director
                                     -------------------------
                                     Printed Name:  Keith Behrens
                                     -----------------------------

<PAGE>

                                    EXHIBIT A
                              FORM OF SUBSCRIPTION
                   (To Be Signed Only On Exercise Of Warrant)

TO:  New  Century  Energy  Corp.
     5851  San  Felipe,  Suite  775
     Houston,  Texas  77057

     Attention:   Chief  Financial  Officer

     The  undersigned,  pursuant  to  the  provisions  set forth in the attached
Warrant  (No.   ), hereby irrevocably elects to purchase           shares of the
            ----                                       ------------
Common Stock covered by such Warrant.

     The  undersigned herewith makes payment of the full Exercise Price for such
shares  at  the  price  per  share  provided  for  in  such  Warrant,  which  is
$         .  Such payment takes the form of $             in lawful money of the
 ---------                                   -------------
United States.

     The undersigned requests that the certificates for such shares be issued in
the  name  of,  and  delivered to
                                 -----------------------------------------------
whose  address  is

-------------------------------------------------------------------------------.

     The  undersigned  represents  and warrants that all offers and sales by the
undersigned of the securities issuable upon exercise of the within Warrant shall
be made pursuant to registration of the Common Stock under the Securities Act of
1933,  as  amended  (the  "Securities  Act")  or  pursuant  to an exemption from
registration under the Securities Act.

Dated:
      ------------------          ---------------------------------------------
                                   (Signature  must  conform  to  name  of
                                   holder  as  specified  on  the  face  of  the
                                   Warrant)

                                   Address:
                                           -------------------------------------

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

<PAGE>

                                    EXHIBIT B
                         FORM OF TRANSFEROR ENDORSEMENT
                   (To Be Signed Only On Transfer Of Warrant)

     For  value  received,  the undersigned hereby sells, assigns, and transfers
unto  the  person(s)  named  below  under  the  heading  "Transferees" the right
represented  by  the  within  Warrant  to  purchase the percentage and number of
shares of Common Stock of New Century Energy Corp. into which the within Warrant
relates  specified  under  the  headings  "Percentage  Transferred"  and "Number
Transferred,"  respectively, opposite the name(s) of such person(s) and appoints
each  such  person attorney to transfer its respective right on the books of New
Century  Energy  Corp.  with  full  power  of  substitution  in  the  premises.

Transferees                 Address                  Percentage      Number
-----------                 -------                  Transferred     Transferred
                                                     -----------     -----------

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

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

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

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

Dated:
      -----------------             --------------------------------------------
                                   (Signature  must  conform  to  name  of
                                   holder  as  specified  on  the  face  of  the
                                   Warrant)

                                   Address:
                                           -------------------------------------

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

                                   SIGNED IN THE PRESENCE OF:

                                   ---------------------------------------------
                                                       (Name)
ACCEPTED AND AGREED:
[TRANSFEREE]

-------------------------------
           (Name)

<PAGE>

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