Document:

SECOND AMENDMENT
                                       TO
                           REVOLVING CREDIT AGREEMENT

     This Second Amendment  ("Second  Amendment") to Fourth Amended and Restated
Credit  Agreement  dated as of March 28, 2002, as amended by the First Amendment
to Fourth Amended and Restated  Credit  Agreement dated as of June 12, 2003 (the
"Credit  Agreement"),  originally by and among CONTINENTAL  RESOURCES,  INC., an
Oklahoma  corporation (the  "Borrower"),  UNION BANK OF CALIFORNIA,  N.A., as LC
Issuer,  Bank, Lead Arranger,  Fronting Bank and  Administrative  Agent (in such
latter  capacity and together with its successors and permitted  assigns in such
capacity the "Administrative Agent"),  GUARANTY BANK, FSB, as Co-Arranger,  Bank
and  Collateral/Documentation  Agent (in such latter  capacity and together with
its successors and permitted  assigns in such capacity the "Collateral  Agent"),
FORTIS CAPITAL CORP., as Co-Arranger, Bank and Syndication Agent (in such latter
capacity and together with its successors and permitted assigns in such capacity
the "Syndication Agent"), and the several banks and financial  institutions from
time to time parties to the Credit  Agreement (the "Banks") is entered into this
22nd day of October 2003.

                              W I T N E S S E T H:

     WHEREAS,  in  consideration  of Borrower  reducing the outstanding  balance
under the Credit Agreement by the sum of $17,000,000.00, which sum is being made
available to Borrower by a distribution  from its subsidiary,  Continental  Gas,
Inc. (herein sometimes called "CGI"), the Banks are willing to (i) assign to the
lenders (or their agent) who are entering into a credit facility with CGI, under
which CGI will obtain the funds used to make the aforesaid distribution from CGI
to Borrower  (hereinafter called the "CGI Credit  Agreement"),  all of the liens
and security  interests  heretofore  granted by CGI to Collateral Agent covering
the Borrowing Base Oil & Gas  Properties  owned by CGI and (ii) release CGI from
the Guaranty  that it executed on March 28, 2003 in  connection  with the Credit
Agreement; and

     WHEREAS, Borrower and the Bank Parties desire to amend the Credit Agreement
as set forth herein;

     NOW,  THEREFORE,  in  consideration  of the  premises  and for Ten  Dollars
($10.00)  and other  good and  valuable  consideration  received  by each  party
hereto,  and each  intending to be legally  bound  hereby,  the parties agree as
follows:

     I.   Amendments to Credit Agreement.

     Article I, DEFINITIONS, of the Credit Agreement is hereby amended by adding
thereto the following defined terms:

     "CGI" means Continental Gas, Inc., an Oklahoma corporation.

     "CGI  Credit  Agreement"  has the meaning  prescribed  for such term in the
     Second Amendment.

     "consolidated"  and  "consolidating,"  as used throughout this Agreement in
     reference to balance  sheets,  Financial  Statements,  GAAP,  and/or within
     other  defined  terms  and  covenants   relating  to  Borrower  and/or  the
     Guarantors shall be deemed in every case to exclude any and all information
     relating to Continental Gas, Inc.

     "Second  Amendment"  means the Second  Amendment to Credit  Agreement dated
     October 22, 2003 among Bank Parties and Borrower.

     Article I,  DEFINITIONS,  of the Credit Agreement is hereby further amended
by revising the definition of "Guarantor(s)" to read as follows:

     "Guarantor(s)" means, individually and collectively,  Continental Resources
     of Illinois,  Inc.,  Continental  Crude Co. and all other  Subsidiaries  of
     Borrower, except and excluding Continental Gas, Inc.

     Section 2.06, Borrowing Base Determination, is hereby amended by adding the
following sentence immediately after the second sentence of such section:

     "The Borrowing Base in effect as of the date of the Second Amendment is One
     Hundred Forty Five Million Dollars ($145,000,000.00)."

     Section 4.01, Existence,  is hereby amended by revising the final clause in
next to the last sentence of such section to read as follows:

     "and Borrower has no  Subsidiaries  other than  Guarantors and  Continental
     Gas, Inc."

     Section 5.35,  Required Hedging  Transaction,  as added to the Agreement by
the First Amendment,  is hereby amended to substitute "50%" in place of "30%" in
such Section.

     Article VI,  NEGATIVE  COVENANTS,  is hereby  amended by adding thereto the
following new Section 6.20:

     6.20 Amendment,  Termination or Waiver of Contracts with CGI. (a) Terminate
     or allow any  contract  with CGI to be  terminated  prior to the  scheduled
     expiration of its stated term; or (b) waive noncompliance with the material
     terms of any material  contract with CGI, or amend in any material  respect
     any material  contract with CGI, if after giving  effect to the  amendment,
     the terms of the amended  contract would be less favorable to Borrower than
     prior to such amendment.

     Section  7.01,  Enumeration  of Events of  Default,  is hereby  amended  by
relabeling  subsections  (i) and (j) thereof to become  subsections (j) and (k),
and by inserting the following new subsection (i):

     "(i) Default shall be made by CGI under the CGI Credit  Agreement at a time
     when CGI  continues to be a Subsidiary  of Borrower,  or a default shall be
     made by CGI with respect to its guaranty of the Senior  Subordinated Notes,
     and any such default shall remain unremedied for in excess of the period of
     grace, if any, with respect thereto."

     The Guarantor's signature page to the Credit Agreement is hereby amended by
deleting the signature block for Continental Gas, Inc.

     Exhibit A attached to the Credit  Agreement  is hereby  amended by deleting
all Borrowing Base Oil and Gas Properties pledged by Continental Gas, Inc.

     All Schedules to the Credit  Agreement  are hereby  amended by deleting all
information relating to Continental Gas, Inc.

     II.  Conditions  Precedent in  Connection  with the Second  Amendment.  The
Second  Amendment  shall not be binding on the Banks until  satisfaction  of the
following conditions precedent:

     A. Administrative Agent shall have received fully executed counterparts, in
     the number of multiple originals requested by Administrative  Agent, of the
     Second Amendment, duly executed by an authorized officer for Borrower.

     B. Borrower (or  Continental  Gas,  Inc. on behalf of Borrower)  shall have
     paid  to the  Administrative  Agent  for  credit  to the  Banks  the sum of
     $17,000,000.00 to reduce the outstanding balance of the Loan.

     C. Borrower shall have paid to Administrative  Agent, for subsequent credit
     to the Banks in accordance with the further provisions hereof, the cash sum
     of $90,000.00 as partial consideration for this Second Amendment including,
     without  limitation,  for  the  release  of  Continental  Gas,  Inc.,  as a
     Guarantor;  and promptly  following receipt of such payment  Administrative
     Agent shall pay to each Bank $15,000.00 out of such $90,000.00 sum.

     D. The representations and warranties contained in Article IV of the Credit
     Agreement shall be true and correct in all material respects on the date of
     the Second  Amendment  with the same effect as though such  representations
     and  warranties  had been made on such date;  and no Event of Default shall
     have occurred and be continuing or will have occurred upon the execution of
     the Second Amendment.

     E. All legal  matters  incident  to the  consummation  of the  transactions
     contemplated  by the  Second  Amendment  shall be  satisfactory  to special
     counsel for the Banks.

     F. All reasonable  and documented  legal fees owed by the Banks to Porter &
     Hedges, L.L.P. in connection with the Second Amendment shall have been paid
     by Borrower.

     III.  Obligations of the Collateral Agent and the Banks.  Contemporaneously
with this Second Amendment becoming effective,  the Bank Parties agree that they
shall perform or cause to be performed each of the following covenants:

     A. The Guaranty  heretofore  executed by  Continental  Gas,  Inc.  shall be
     terminated in writing and Continental  Gas, Inc. shall be released from all
     of its obligations and liabilities under such Guaranty.

     B. Collateral Agent shall execute and deliver to the  Administrative  Agent
     designated in the CGI Credit Agreement (the "CGI Administrative Agent"), an
     Assignment  of Liens in form and  substance  mutually  satisfactory  to the
     Collateral Agent and the CGI  Administrative  Agent transferring to the CGI
     Administrative  Agent all liens and security  interests  arising  under and
     pursuant to the Security  Instruments  heretofore executed by CGI to secure
     the Obligations of Borrower under the Credit Agreement.

     IV. Certain  Waivers.  The Bank Parties  hereby grant a one-time  waiver of
Borrower's failure to be in compliance with the Current Ratio covenant set forth
in Section 6.15 of the Credit  Agreement  for the quarter  ended  September  30,
2003.  This  one-time  waiver is not intended to establish any course of dealing
between the Bank Parties and Borrower, or to indicate any intention or agreement
to grant future waivers of any  non-compliance by Borrower with any of the terms
of the Credit Agreement. Any future waivers must be in writing and signed by the
Bank  Parties,  and any alleged  waiver that is not in writing and signed by the
Bank Parties  shall be subject to the  provisions  of Section 9.07 of the Credit
Agreement.

     V. Reaffirmation of Representations and Warranties.  To induce the Banks to
enter into this Second Amendment,  the Borrower hereby reaffirms, as of the date
hereof, its representations and warranties contained in Article IV of the Credit
Agreement and in all other documents executed pursuant thereto, and additionally
represents and warrants as follows:

     A. The execution and delivery of this Second  Amendment and the performance
     by the Borrower of its obligations  under this Second  Amendment are within
     the Borrower's power, have been duly authorized by all necessary  corporate
     action, have received all necessary  governmental approval (if any shall be
     required),  and do not  and  will  not  contravene  or  conflict  with  any
     provision  of law or of the  charter or by-laws of the  Borrower  or of any
     agreement binding upon the Borrower.

     B. The Credit Agreement as amended by this Second Amendment  represents the
     legal, valid and binding  obligations of the Borrower,  enforceable against
     the  Borrower  in  accordance  with their  respective  terms  subject as to
     enforcement only to bankruptcy, insolvency,  reorganization,  moratorium or
     other  similar  laws  affecting  the   enforcement  of  creditors'   rights
     generally.

     C. No Event of Default or  Unmatured  Event of Default has  occurred and is
     continuing as of the date hereof.

     D. Since the date of the Agreement,  Borrower has not formed or created any
     new Subsidiaries.

     VI. Defined  Terms.  Except as amended  hereby,  terms used herein that are
defined in the Credit Agreement shall have the same meanings herein.

     VII.  Reaffirmation  of Credit  Agreement.  This Second  Amendment shall be
deemed to be an amendment to the Credit Agreement,  and the Credit Agreement, as
further amended hereby,  is hereby ratified,  approved and confirmed in each and
every respect.  All references to the Credit  Agreement  herein and in any other
document, instrument, agreement or writing shall hereafter be deemed to refer to
the Credit Agreement as amended hereby.

     VIII. Entire Agreement.  The Credit Agreement, as hereby amended,  embodies
the entire agreement between the Borrower and the Banks and supersedes all prior
proposals,  agreements and understandings relating to the subject matter hereof.
The  Borrower  certifies  that it is  relying  on no  representation,  warranty,
covenant or  agreement  except for those set forth in the Credit  Agreement,  as
hereby amended,  and in the other documents  previously  executed or executed of
even date herewith.

     IX. Governing Law. THIS SECOND AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA.  This Second Amendment has been entered into in Harris
County,  Texas,  and it shall be performable  for all purposes in Harris County,
Texas. Courts within the State of Texas shall have jurisdiction over any and all
disputes  between  the  Borrower  and  the  Banks,  whether  in law  or  equity,
including,  but not limited to, any and all disputes  arising out of or relating
to this Second Amendment or any other Security Instrument; and venue in any such
dispute whether in federal or state court shall be laid in Harris County, Texas.

     X. Severability.  Whenever possible each provision of this Second Amendment
shall  be  interpreted  in  such  manner  as to be  effective  and  valid  under
applicable  law,  but if  any  provision  of  this  Second  Amendment  shall  be
prohibited  by  or  invalid  under  applicable  law,  such  provision  shall  be
ineffective  to  the  extent  of  such   prohibition   or  invalidity,   without
invalidating the remainder of such provision or the remaining provisions of this
Second Amendment.

     XI. Execution in Counterparts. This Second Amendment may be executed in any
number of counterparts  and by the different  parties on separate  counterparts,
and each  such  counterpart  shall be  deemed  to be an  original,  but all such
counterparts shall together constitute but one and the same agreement.

     XII. Section  Captions.  Section captions used in this Second Amendment are
for convenience of reference only, and shall not affect the construction of this
Second Amendment.

     XIII.  Successors and Assigns.  This Second Amendment shall be binding upon
the  Borrower and the Banks and their  respective  successors  and assigns,  and
shall inure to the benefit of the  Borrower  and the Banks,  and the  respective
successors and assigns of the Banks.

     XIV.  Non-Application  of Chapter 346 of Texas Finance  Codes.  In no event
shall Chapter 346 of the Texas Finance Code (which regulates  certain  revolving
loan accounts and revolving  tri-party  accounts) apply to this Credit Agreement
as hereby  further  amended  or any other  Loan  Documents  or the  transactions
contemplated hereby.

     XV. Notice. THIS SECOND AMENDMENT TOGETHER WITH THE LOAN AGREEMENT, AND THE
OTHER SECURITY INSTRUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS  OF THE  PARTIES.  THERE ARE NO WRITTEN ORAL  AGREEMENTS  BETWEEN THE
PARTIES.

                            [signature pages follow]

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

                                 BORROWER:

                                 CONTINENTAL RESOURCES, INC.

                                 By:     ROGER CLEMENT
                                         Roger Clement
                                         Senior Vice President and Chief
                                         Financial Officer

                                 ADMINISTRATIVE AGENT, LEAD ARRANGER,
                                 LC ISSUER, FRONTING BANK AND BANK:

                                 UNION BANK OF CALIFORNIA, N.A.

                                 By:     RANDALL OSTERBERG
                                         Randall Osterberg,
                                         Senior Vice President

                                 By:     JOHN CLARK
                                         John Clark,
                                         Vice President

                                 COLLATERAL/DOCUMENTATION
                                 AGENT, CO-ARRANGER AND BANK:

                                 GUARANTY BANK, FSB

                                 By:     RICHARD MENCHACA
                                         Richard Menchaca,
                                         Vice President

                                 SYNDICATION AGENT, CO-ARRANGER AND BANK:

                                 FORTIS CAPITAL CORP.

                                 By:     DARRELL W. HOLLEY
                                         Darrell W. Holley,
                                         Managing Director

                                 By:     CHRISTOPHER S. PARADA
                                         Christopher S. Parada,
                                         Vice President

                                 BANKS:

                                 COMPASS BANK

                                 By:     KATHLEEN J. BOWEN
                                         Kathleen J. Bowen
                                         Vice President

                                 WELLS FARGO BANK TEXAS, N.A.

                                 By:     DUSTIN S. HANSEN
                                         Dustin S. Hansen
                                         Assistant Vice President

                                 COMERICA BANK

                                 By:     PETER L. SEFZIK
                                         Peter L. Sefzik
                                         Assistant Vice PresidentTERM AND REVOLVING CREDIT AGREEMENT

                   TERM LOAN FACILITY OF UP TO $25,000,000.00
                                       and
                            REVOLVING CREDIT FACILITY
                             OF UP TO $10,000,000.00

                                      AMONG

                         UNION BANK OF CALIFORNIA, N.A.
  As Administrative Agent, LC Issuer, Lead Arranger, Fronting Bank and a Bank;

                              FORTIS CAPITAL CORP.
                  As Syndication Agent, Co-Arranger and a Bank,

                          WELLS FARGO BANK TEXAS, N.A.
                 As Documentation Agent, Co-Arranger and a Bank,

                                 OTHER FINANCIAL
                             INSTITUTIONS AND BANKS,
                                    As Banks,

                                       and

                              CONTINENTAL GAS, INC.

                                   As Borrower

                                October 22, 2003

<PAGE>
<TABLE>
                                            TABLE OF CONTENTS
<CAPTION>
                                                                                                    Page
                                                                                                    ----
<S>                                                                                                   <C>
Article I. DEFINITIONS.................................................................................1

Article II. THE LOANS AND LETTERS OF CREDIT...........................................................21
     2.01     The Commitment..........................................................................21
     2.02     Notice and Manner of Borrowing..........................................................21
     2.03     Payment Procedure.......................................................................22
     2.04     Payments of Interest under the Notes....................................................22
     2.05     General Provisions Relating to Interest.................................................24
     2.06     Availability Amount Determination.......................................................24
     2.07     Mandatory Prepayment Due to a Revolving Loan Deficiency.................................26
     2.08     Other Mandatory Payments and Prepayments................................................27
     2.09     Prepayment and Conversion...............................................................27
     2.10     Increased Cost of Loans.................................................................27
     2.11     Change of Law...........................................................................29
     2.12     Mitigation: Mandatory Assignment........................................................29
     2.13     Pro Rata Treatment and Payments.........................................................30
     2.14     Sharing of Payments and Setoffs.........................................................30
     2.15     Commitment Fee..........................................................................30
     2.16     Availability Amount Increase Fee........................................................31
     2.17     Up-Front Fee............................................................................31
     2.18     Addition of Collateral Assets...........................................................31
     2.19     Adjustment to Aggregate Commitment Amount...............................................31
     2.20     Facility LCs............................................................................32
     2.21     Advances to Satisfy Obligations of the Borrower.........................................36
     2.22     Assignment of Production................................................................36
     2.23     Facility Termination Date...............................................................36

Article III. CONDITIONS...............................................................................36
     3.01     General Conditions to Closing and to all Disbursements..................................36
     3.02     Deliveries at the Closing...............................................................37
     3.03     Documents Required for Subsequent Disbursements Involving Additional Collateral Assets..39

Article IV. REPRESENTATIONS AND WARRANTIES............................................................39
     4.01     Existence...............................................................................39
     4.02     Due Authorization.......................................................................39
     4.03     Valid and Binding Obligations...........................................................40
     4.04     Scope and Accuracy of Financial Statements..............................................40
     4.05     Title to Collateral Assets..............................................................40
     4.06     Oil and Gas Leases......................................................................40
     4.07     Interest in the Collateral Assets.......................................................40
     4.08     Oil and Gas Contracts...................................................................41
     4.09     Producing Wells.........................................................................41
     4.10     Purchasers of Production................................................................41
     4.11     Authorizations and Consents.............................................................41
     4.12     Environmental Laws......................................................................42
     4.13     Compliance with Laws, Rules, Regulations and Orders.....................................42
     4.14     Liabilities, Litigation and Restrictions................................................43
     4.15     Existing Indebtedness...................................................................43
     4.16     Material Contracts......................................................................43
     4.17     Margin Stock............................................................................43
     4.18     Proper Filing of Tax Returns and Payment of Taxes Due...................................43
     4.19     ERISA  44
     4.20     Investment Company Act Compliance.......................................................44
     4.21     Public Utility Holding Company Act Compliance...........................................44
     4.22     Insurance...............................................................................44
     4.23     Borrower's Shareholders and Directors...................................................44
     4.24     Material Misstatements and Omissions....................................................44

Article V. AFFIRMATIVE COVENANTS......................................................................45
     5.01     Use of Funds............................................................................45
     5.02     Maintenance and Access to Records.......................................................45
     5.03     Quarterly Unaudited Financial Statements................................................45
     5.04     Annual Audited Financial Statements.....................................................45
     5.05     Compliance Certificate..................................................................45
     5.06     Statement of Material Adverse Change....................................................45
     5.07     Title Defects...........................................................................46
     5.08     Additional Information..................................................................46
     5.09     Compliance with Laws and Payment of Assessments and Charges.............................46
     5.10     Maintenance of Existence and Good Standing..............................................46
     5.11     Further Assurances......................................................................46
     5.12     Initial Expenses of the Bank............................................................46
     5.13     Subsequent Expenses of the Bank Parties.................................................46
     5.14     Maintenance of Tangible Property........................................................47
     5.15     Maintenance of Insurance................................................................47
     5.16     Inspection of Tangible Assets/Right of Audit............................................47
     5.17     Payment of Note and Performance of Obligations..........................................47
     5.18     Availability Amount.....................................................................47
     5.19     Compliance with Environmental Laws......................................................48
     5.20     Hazardous Substances Indemnification....................................................48
     5.21     Transactions with Affiliates............................................................49
     5.22     Leases 49
     5.23     Operation of Collateral Assets..........................................................49
     5.24     Assignments.............................................................................49
     5.25     Change of Purchasers of Production......................................................49
     5.26     Payment of Taxes, Etc...................................................................49
     5.27     Notice of Litigation....................................................................50
     5.28     Notice of Events of Default.............................................................50
     5.29     Notice of Change of Principal Offices...................................................50
     5.30     Employee Benefit Plans..................................................................50
     5.31     Annual Capital Budget...................................................................50
     5.32     Payment of Obligations..................................................................51
     5.33     Compliance with Section 2.06............................................................51
     5.34     Notice Regarding Early Termination of Hedge Agreements..................................51
     5.35     Accounts Receivable Aging Reports.......................................................51
     5.36     Accruals for Personal Tax Distributions.................................................51
     5.37     Collateral Audit........................................................................52

Article VI. NEGATIVE COVENANTS........................................................................53
     6.01     Other Indebtedness......................................................................53
     6.02     Loans or Advances.......................................................................53
     6.03     Mortgages or Pledges of Assets..........................................................53
     6.04     Sales of Assets.........................................................................53
     6.05     Payment of Accounts Payable.............................................................53
     6.06     Cancellation of Insurance...............................................................53
     6.07     Investments.............................................................................53
     6.08     Changes in Structure or Business........................................................54
     6.09     Pooling or Unitization..................................................................54
     6.10     Hedge Agreements........................................................................54
     6.11     Capital Stock of Borrower/Redemption of Senior Subordinated Notes.......................54
     6.12     Margin Stock............................................................................54
     6.13     Amendment, Termination or Waiver of Material Contracts..................................54
     6.14     Current Ratio...........................................................................55
     6.15     Interest Charge Coverage Ratio..........................................................55
     6.16     Fixed Charge Coverage Ratio.............................................................55
     6.17     Senior Debt to EBITDA...................................................................55
     6.18     Rolling Four-Quarter Basis..............................................................55

Article VII. EVENTS OF DEFAULT........................................................................55
     7.01     Enumeration of Events of Default........................................................55
     7.02     Rights Upon Unmatured Event of Default..................................................57
     7.03     Rights Upon Default.....................................................................57
     7.04     Remedies................................................................................58
     7.05     Right of Set-off........................................................................58

Article VIII. THE AGENTS..............................................................................59
     8.01     Authorization and Action................................................................59
     8.02     Agent's Reliance, Etc...................................................................59
     8.03     Each Agent and its Affiliates...........................................................60
     8.04     Bank Credit Decision....................................................................60
     8.05     Agent's Indemnity.......................................................................60
     8.06     Successor Agents........................................................................61
     8.07     Notice of Default.......................................................................61

Article IX. MISCELLANEOUS.............................................................................62
     9.01     Security Interests in Deposits and Right of Offset or the Banker's Lien.................62
     9.02     Survival of Representations, Warranties and Covenants...................................62
     9.03     Notices and Other Communications........................................................62
     9.04     Parties in Interest.....................................................................62
     9.05     Successors and Assigns; Participation; Purchasing Banks.................................62
     9.06     Renewals and Extensions.................................................................65
     9.07     No Waiver by the Bank Parties...........................................................65
     9.08     Waiver, Release, and Indemnification by the Borrower....................................65
     9.09     GOVERNING LAW...........................................................................66
     9.10     Incorporation of Exhibits and Schedules.................................................66
     9.11     Survival Upon Unenforceability..........................................................66
     9.12     Rights of Third Parties.................................................................66
     9.13     Amendments or Modifications.............................................................66
     9.14     Agreement Construed as an Entirety......................................................67
     9.15     Number and Gender.......................................................................67
     9.16     AGREEMENT SUPERSEDES ALL PRIOR AGREEMENTS...............................................67
     9.17     Controlling Provision Upon Conflict.....................................................68
     9.18     Time, Place and Method of Payments......................................................68
     9.19     Termination.............................................................................68
     9.20     Non-Application of Chapter 346 of Texas Finance Code....................................68
     9.21     Counterpart Execution...................................................................68
     9.22     Power of Attorney.......................................................................69
     9.23     Borrower's CRI Security Instruments.....................................................69
     9.24     Confidentiality.........................................................................69
</TABLE>

EXHIBITS

EXHIBIT A             Collateral Assets
EXHIBIT B-1                     Form of Term Notes
EXHIBIT B-2                     Form of Revolving Notes
EXHIBIT C             Compliance Certificate
EXHIBIT D             Security Instruments
EXHIBIT E             Request for Advance
EXHIBIT F             Availability Amount Certificate

SCHEDULES

Schedule 1.01(b)                Commitment Amount and Aggregate Commitment
Schedule 2.20(C)                Fax Numbers for all Parties
Schedule 4.01                   Information Regarding the Borrower and
                                  its Subsidiaries
Schedule 4.08                   Certain Oil and Gas Contracts
Schedule 4.10                   List of Purchasers of Production
Schedule 4.15                   Existing Indebtedness
Schedule 4.16                   Material Contracts
Schedule 4.22                   Insurance Certificates
Schedule 4.23                   Borrower's Shareholders and Directors
Schedule 9.05(d)                Commitment Transfer Supplement
<PAGE>

                       TERM AND REVOLVING CREDIT AGREEMENT

     THIS TERM AND REVOLVING CREDIT AGREEMENT (this "Agreement"), executed as of
October  22,  2003,  is by  and  between  CONTINENTAL  GAS,  INC.,  an  Oklahoma
corporation  (the  "Borrower"),  UNION BANK OF  CALIFORNIA,  N.A., as LC Issuer,
Bank,  Lead  Arranger,  Fronting Bank and  Administrative  Agent (in such latter
capacity and together with its successors and permitted assigns in such capacity
the  "Administrative  Agent"),  FORTIS CAPITAL CORP., as  Co-Arranger,  Bank and
Syndication  Agent (in such latter capacity and together with its successors and
permitted  assigns in such capacity the "Syndication  Agent"),  WELLS FARGO BANK
TEXAS,  N.A.,  as  Co-Arranger,  Bank and  Documentation  Agent (in such  latter
capacity and together with its successors and permitted assigns in such capacity
the  "Documentation  Agent"),  and the several banks and financial  institutions
from time to time parties to this Credit  Agreement  (the  "Banks," such term to
include  all  undersigned  Banks  and all  other  financial  institutions  which
subsequently  become parties to this  Agreement in accordance  with Section 9.05
hereof).

                               W I T N E S S E T H

     WHEREAS,  Borrower  is one of the  guarantors  of the  Indebtedness  of its
parent company,  Continental  Resources,  Inc., an Oklahoma corporation ("CRI"),
pursuant to that certain  Fourth  Amended and Restated  Credit  Agreement  dated
March 28, 2002, among Union Bank of California,  N.A., as  Administrative  Agent
and in other capacities,  together with other financial  institutions and banks,
and CRI, as Borrower (the "CRI Credit Agreement");

     WHEREAS,  Borrower  desires to obtain a term loan and a line of credit from
the Banks  who are party to this  Agreement,  in  accordance  with the terms set
forth  herein,  and to use a portion  of the  advances  under this  facility  to
distribute to CRI,  which  distribution  will be used by CRI for prepayment of a
portion of the Indebtedness outstanding under the CRI Credit Agreement;

     WHEREAS, in consideration for Borrower's  distribution to CRI and CRI's use
of that  distribution  to prepay a  portion  of the  Indebtedness  under the CRI
Credit  Agreement,  the lenders  under the CRI Credit  Agreement  are willing to
release Borrower from its guaranty of the obligations of CRI thereunder; and

     WHEREAS,  Borrower and the Bank Parties desire to enter into this Agreement
in accordance with the terms set forth herein.

     NOW,  THEREFORE,  in  consideration  of the mutual covenants and agreements
herein contained, the Bank Parties and the Borrower agree as follows:

                                   Article I.

                                   DEFINITIONS

     As used in this  Agreement,  the  following  terms shall have the  meanings
indicated:

     "Accounts,"   "Chattel  Paper,"  "Contracts,"   "Documents,"   "Equipment,"
"Fixtures," "General Intangibles," "Goods," "Instruments," and "Inventory" shall
have the same  respective  meanings  as are given to those  terms in the Uniform
Commercial Code as presently adopted and in effect in the State of Oklahoma.

     "Administrative   Agent"  means  Union  Bank  of   California,   N.A.,   as
Administrative Agent for the Banks hereunder and under the other Loan Documents,
and each successor Administrative Agent.

     "Affiliate" means, as applied to any Person, any other Person,  directly or
indirectly,  controlling,  controlled  by, or under common  control  with,  that
Person. For purposes of this definition,  "control" (including, with correlative
meanings,  the terms  "controlling",  "controlled by", and "under common control
with"), as applied to any Person, means either: (a) the possession,  directly or
indirectly,  of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities,  by
contract,  or otherwise,  or (b) the legal or beneficial  ownership of or voting
rights with  respect to one-third  (1/3) or more of the equity  interest in such
Person.

     "Agent(s)" means, individually and collectively,  the Administrative Agent,
the Syndication  Agent, and the Documentation  Agent, and each successor to each
of such respective positions.

     "Aggregate  Commitment  Amount"  means the lesser of: (a) the  Availability
Amount in effect from time to time,  or (b) the amount  stated as the  Aggregate
Commitment  Amount  on  Schedule  1.01(b)  attached  hereto,  as the same may be
amended from time to time as provided in this Agreement.

     "Aggregate  Outstanding  Credit Exposure" means, at any time, the aggregate
of the Outstanding Credit Exposure of all the Banks.

     "Agreement" means this Term and Revolving Credit Agreement, as the same may
be amended or supplemented from time to time.

     "Annual Tax Rate" has the meaning stated in Section 5.35.

     "Applicable  Law" means that law in effect from time to time and applicable
to the Notes which  lawfully  permits the charging and collection of the highest
permissible lawful,  non-usurious rate of interest on the Notes,  including laws
of the State of Texas and laws of the United  States of America;  Chapter 303 of
the Texas  Finance  Code shall be  included in the laws of the State of Texas in
determining  Applicable Law; and for the purpose of applying said Chapter 303 to
the Notes, the interest  ceiling  applicable to the Notes under said Chapter 303
shall be the indicated weekly rate ceiling from time to time in effect.

     "Applicable Margin" means the applicable LIBOR Margin or RR Margin provided
for in the  Pricing  Grid set forth  below  based upon the Senior Debt to EBITDA
Ratio.

     "Arranger" means, individually and collectively, the Lead Arranger and each
Co-Arranger,  each such  position  being held as of the Closing by Union Bank of
California,  N.A.,  Fortis  Capital  Corp.,  and Wells Fargo Bank  Texas,  N.A.,
respectively.

     "Availability  Amount"  means the sum of:  (a) the Term  Loan  Availability
Amount,  plus (b) the Revolving Loan Availability  Amount, as each is determined
and in effect from time to time pursuant to Section 2.06.

     "Availability  Amount  Certificate" means a fully completed  certificate in
the form of  Exhibit  F to this  Agreement,  certified  by the  chief  financial
officer of the  Borrower to be correct and  delivered  to, and  accepted by, the
Banks pursuant to Section 2.06.

     "Bank(s)"  means  any of the  banks  signatory  to  this  Agreement,  their
successors   and,  upon  the  effective   date  after   registration   with  the
Administrative   Agent  pursuant  to  Section  9.05  of  a  Commitment  Transfer
Supplement executed by a Purchasing Bank, such Purchasing Bank.

     "Bank  Parties" means the Banks,  the Fronting  Bank,  the LC Issuer,  each
Co-Arranger,  the Lead Arranger,  the Syndication Agent, the Documentation Agent
and the Administrative Agent.

     "Borrower"  has  the  meaning  stated  therefor  in the  preamble  of  this
Agreement.

     "Borrower  Guaranty" means that certain Guaranty  Agreement dated March 28,
2002,  pursuant to which Borrower guaranteed full payment and performance of all
of CRI's obligations under the CRI Credit Agreement.

     "Borrower's CRI Security  Instruments" means,  collectively,  all documents
executed by Borrower  pursuant to the CRI Credit  Agreement  creating  liens and
security  interests on assets of Borrower to secure CRI's  obligations under the
CRI Credit Agreement, as heretofore or hereafter amended.

     "Borrower's Percentage Share" has the meaning stated in Section 5.35.

     "Borrowing"  means a group of Loans  made by the  Banks  to  Borrower  on a
single date.

     "Breakage  Costs" means all  reasonable  losses,  expenses and  liabilities
(including,  without  limitation,  any loss,  expense or  liability  incurred by
reason of the liquidation or reemployment of deposits or other funds required by
any Bank to fund its LIBOR Loans but excluding loss of  anticipated  profit with
respect to any LIBOR Loans)  which such Bank may sustain:  (i) if for any reason
(other than a default by such Bank or the  Administrative  Agent) a borrowing of
LIBOR  Loans  does not  occur on a date  specified  therefor  in a  Request  for
Advance; (ii) if any repayment or conversion of any LIBOR Loans occurs on a date
which is not the last day of an Interest Period applicable thereto; (iii) if any
prepayment  of any LIBOR Loans is not made on any date  specified in a notice of
prepayment  given by Borrower;  or (iv) as a  consequence  of any default by the
Borrower to repay LIBOR Loans when required by the terms of this Agreement.

     "Business  Day" means a day other than a Saturday,  Sunday or legal holiday
for  commercial  banks  under  the laws of the  State  of Texas or the  State of
California,  provided  that with respect to  transactions  under this  Agreement
relating to LIBOR Loans, such day must also be a Eurodollar Business Day.

     "Business Entity" means a company, corporation,  limited liability company,
limited partnership,  partnership,  joint venture, trust, association,  or other
entity other than a natural  person,  that has been formed and exists to conduct
any line of business.

     "Certificate  of  Formation"  means any  certificates,  articles,  or other
instruments  that are  required  or  permitted  to be filed with any  designated
agency  of the  jurisdiction  in which a  Business  Entity is formed in order to
evidence the legal formation of such Business Entity.

     "Change of Control" means any of the following events:  (a) any "person" or
"group" (within the meaning of Section 13(d) or 14(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")),  other than the persons or groups
who are the beneficial  owners of the  outstanding  capital stock of Borrower on
the date of this Agreement, has become, directly or indirectly,  the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,  except that
a Person shall be deemed to have "beneficial  ownership" of all such shares that
any such  Person has the right to  acquire,  whether  such right is  exercisable
immediately or only after the passage of time), by way of merger,  consolidation
or  otherwise,  of a  majority  or more of the  common  stock of  Borrower  on a
fully-diluted  basis,  after giving effect to the conversion and exercise of all
outstanding  warrants,  options and other securities of the Borrower (whether or
not such securities are then currently  convertible or exercisable),  (b) during
any  period  of  two  consecutive  calendar  quarters,  individuals  who  at the
beginning of such period were members of the Borrower's board of directors cease
for any reason to constitute a majority of the directors of the Borrower then in
office unless (i) such new directors were elected by a majority of the directors
of the  Borrower who  constituted  the board of directors of the Borrower at the
beginning  of such  period (or by  directors  so elected) or (ii) the reason for
such  directors  failing to  constitute a majority is a result of  retirement by
directors  due to age,  death or  disability,  (c) Harold  Hamm no longer  owns,
directly or  indirectly,  a  controlling  beneficial  interest or  ownership  in
Borrower,  (d) neither  Harold Hamm nor Randy  Moeder  continues to be the chief
executive  officer  of  Borrower,  or (e)  CRI  and/or  Harold  Hamm  no  longer
beneficially  own,  in  the  aggregate,  at  least  60% of all  the  issued  and
outstanding shares of common stock of Borrower.

     "Closing" has the meaning provided in Section 3.01.

     "Co-Arranger"  means  each of Fortis  Capital  Corp.  and Wells  Fargo Bank
Texas, N.A., and each successor to such position.

     "Collateral   Assets"  means  all  Oil  and  Gas  Properties  and  Pipeline
Properties  of the  Borrower,  including,  but not  limited  to,  those that are
described in Exhibit "A" attached hereto and made a part hereof, as such Exhibit
"A" may be  amended  from  time to time,  together  with any  other  Oil and Gas
Properties  and Pipeline  Properties  of the Borrower  that are described in and
covered by (or that Administrative Agent and Borrower have attempted to describe
in) any of the Security Instruments,  whether or not such Oil and Gas Properties
or Pipeline Properties are described in Exhibit A attached hereto.

     "Collateral Audit" has the meaning provided in Section 5.37.

     "Commitment"  means,  as to any Bank,  the  obligation of such Bank to make
Loans to, and  participate in Facility LCs issued upon the  application  of, the
Borrower in an aggregate  amount at any one time  outstanding  not to exceed the
lesser of (i) such  Bank's  Commitment  Amount and (ii) such  Bank's  Percentage
Share of the Availability Amount then in effect.

     "Commitment  Amount" means at any time,  for any Bank, the amount set forth
opposite  such  Bank's name on Schedule  1.01(b)  under the heading  "Commitment
Amount," as such amount may be changed as provided in this Agreement.

     "Commitment  Transfer  Supplement" means a Commitment  Transfer  Supplement
executed by Administrative Agent and a Purchasing Bank substantially in the form
of Schedule  9.05(d) and registered  with the  Administrative  Agent pursuant to
Section 9.05(d) hereof.

     "Compliance  Certificate"  means the  certificate of the President or Chief
Financial  Officer of the Borrower  submitted to the  Administrative  Agent from
time to time pursuant to this Agreement and attesting to the financial covenants
and stating, to such officer's knowledge,  whether or not an Event of Default or
an Unmatured  Event of Default has occurred  and is  continuing  and, if such an
event has  occurred,  the  actions  being  taken by the  Borrower to remedy such
situation  and that  GAAP  has been  used in the  preparation  of the  Financial
Statements,  which  certificate  shall be in the form attached hereto as Exhibit
"C".

     "COPAS" means the Accounting Procedure Joint Operations  recommended by the
Council  of  Petroleum  Accountants,   with  respect  to  onshore  and  offshore
operations,  respectively,  including the most current  versions thereof and any
other recent versions thereof commonly in use.

     "Corporate Action" means action taken by the Governing Body of any Business
Entity (not just a  corporation)  in order to  authorize  such  Business  Entity
pursuant to its  Governing  Documentation  to enter into and become bound by the
terms of any particular transaction.

     "Corporate Power" means the power and authority of a Business Entity, under
the terms of its Governing  Documentation and applicable law, to enter into, and
become bound by, the terms of any particular transaction.

     "Credit Extension" means the making of a Loan or the issuance of a Facility
LC hereunder.

     "Credit  Extension  Date"  means the date on which a Loan is  advanced or a
Facility LC is issued.

     "CRI" has the meaning stated therefor in the Recitals to this Agreement.

     "CRI Credit  Agreement" has the meaning stated  therefor in the recitations
to this Agreement.

     "Current  Assets" means at any time, all assets,  that should in accordance
with GAAP, be classified as current assets on a balance sheet of Borrower,  plus
the then current availability under the aggregate Commitments, but excluding any
mark-to-market valuation under Permitted Hedge Agreements.

     "Current  Liabilities"  means at any time, all  liabilities  that should in
accordance with GAAP, be classified as current liabilities on a balance sheet of
Borrower,  but excluding any  mark-to-market  valuation  under  Permitted  Hedge
Agreements,  and excluding the amount of Credit  Extensions under this Agreement
that is deemed to be current in accordance with GAAP.

     "Current  Ratio" means the ratio  derived from dividing  Current  Assets by
Current Liabilities.

     "Defensible Title" means good and defensible title, as set forth, qualified
and/or  limited  on  Exhibit  "A,"  free and clear of all  mortgages,  liens and
encumbrances, except for Permitted Encumbrances.

     "Documentation  Agent"  means Wells Fargo Bank Texas,  N.A.,  Documentation
Agent for the Banks  hereunder  and under  the other  Loan  Documents,  and each
successor Documentation Agent.

     "EBITDA"  means,  for any  reporting  period,  Borrower's  Net  Income on a
consolidated basis before deductions for interest expense, taxes,  depreciation,
depletion and amortization,  exploration expenses, including dry hole costs, and
non-cash compensation expense.

     "Eligible  Account"  means,  at any time,  an  Account  that  conforms  and
continues to conform to the following conditions:

     (A)  The  Account  arose  from a bona  fide  sale  of  Hydrocarbons  by the
          Borrower in the  ordinary  course of  business or from gas  gathering,
          compression,   processing,   treatment,  or  other  handling  services
          performed by the Borrower,  and such Hydrocarbons have been shipped to
          the  appropriate  account  debtors or their designees (or the sale has
          otherwise been  consummated),  or the services have been performed for
          the appropriate account debtors;

     (B)  The Account is based upon an enforceable order or contract, written or
          oral, for Hydrocarbons shipped or held or for services performed,  and
          the same were  shipped,  held,  or performed in  accordance  with such
          order or contract;

     (C)  The title of the Borrower to the Account and, except as to the account
          debtor,  to any  Hydrocarbons  is  absolute  and is not subject to any
          prior assignment,  claim, lien, or security interest, except Permitted
          Liens;

     (D)  The amount  shown on the books of the  Borrower  and on any invoice or
          statement  delivered  to the  Administrative  Agent  is  owing  to the
          Borrower,  less any  partial  payment  that has been made  thereon  by
          anyone;

     (E)  The  Account  shall  be  eligible  only to the  extent  that it is not
          subject to any claim of reduction, counterclaim,  set-off, recoupment,
          or any claim for credits,  allowances,  or  adjustments by the account
          debtor  because  of  nonconforming   Hydrocarbons  or   unsatisfactory
          services, or for any other reason, except for customary discounts, not
          to exceed five per cent (5%), allowed for prompt payment;

     (F)  The account debtor has not returned or refused to retain, or otherwise
          notified   the  Borrower  of  any  dispute   concerning,   or  claimed
          nonconformity of, any of the Hydrocarbons or services from the sale of
          which the Account arose;

     (G)  The Account is due and payable not more than thirty (30) days from the
          date of the invoice therefor;

     (H)  The Account is not more than thirty (30) days past due nor outstanding
          more than sixty (60) days from the date of the invoice therefor;

     (I)  The Account does not arise out of a contract  with,  or order from, an
          account  debtor  that,  by  its  terms,   forbids  or  makes  void  or
          unenforceable  the  assignment  by the Borrower to the  Administrative
          Agent of the Account arising with respect thereto;

     (J)  The Borrower has not received any note,  trade  acceptance,  draft, or
          other  Instrument with respect to, or in payment of, the Account,  nor
          any Chattel Paper with respect to the Hydrocarbons  giving rise to the
          Account,  unless,  if any such  Instrument  or Chattel  Paper has been
          received,  the  Borrower  immediately  notifies  the Bank and,  at the
          latter's  request,  endorses or assigns and  delivers  the same to the
          Bank;

     (K)  The  Borrower  has not received any notice of the death of the account
          debtor or a partner  thereof nor of the  dissolution,  termination  of
          existence, insolvency, business failure, appointment of a receiver for
          any part of the property of,  assignment  for the benefit of creditors
          by, or the filing of a petition in bankruptcy or the  commencement  of
          any proceeding  under any bankruptcy or insolvency laws by or against,
          the  account  debtor.  Upon the  receipt by the  Borrower  of any such
          notice,  it will  immediately  give the  Administrative  Agent written
          advice thereof; and

     (L)  The  account  debtor is not a  Subsidiary  or other  Affiliate  of the
          Borrower, other than CRI.

     "Engineering  Report" means:  (a) when used in regard to Collateral  Assets
that are Oil and Gas Properties,  a report prepared by an independent  petroleum
engineer or firm of engineers  acceptable to Administrative  Agent regarding the
Proved Reserves  attributable to such Collateral Assets , using the criteria and
parameters required by and acceptable to the Securities and Exchange Commission,
and  incorporating  the present cost of  appropriate  plugging  and  abandonment
obligations  to be incurred in the future,  taking into account any plugging and
abandonment  fund required to be accrued or  established by Borrower out of cash
flow from the  Collateral  Assets  covered by such report  with  respect to such
future  obligations;  and (b) when used in regard to Collateral  Assets that are
Pipeline Properties,  a report in form and substance reasonably  satisfactory to
all the Banks,  similar to the form and  components of such reports  provided by
Borrower to the Banks in connection with the Banks' determination of the initial
Revolving  Loan  Availability  Amount  prior to the Closing  pursuant to Section
3.02(N),  each such report to be  sufficient  for the Banks to estimate to their
reasonable satisfaction the future net income to be derived by Borrower from the
Collateral  Assets that are  Pipeline  Properties  and to support  with  summary
engineering  information  regarding  the gas reserves that are committed to such
Pipeline  Properties and the estimated  throughput  volumes of gas attributed to
such Pipeline Properties.

     "Environmental  Laws" means (a) the  following  federal laws as they may be
cited,  referenced  and amended from time to time:  the Clean Air Act, the Clean
Water  Act,  the  Safe  Drinking  Water  Act,  the  Comprehensive  Environmental
Response,  Compensation  and  Liability  Act,  the  Endangered  Species Act, the
Resource  Conservation and Recovery Act, the Occupational Safety and Health Act,
the  Hazardous  Materials  Transportation  Act,  the  Superfund  Amendments  and
Reauthorization Act, the Toxic Substances Control Act, and the Oil Pollution Act
of 1990; (b) any and all  environmental  statutes of any state in which property
of the Borrower is situated,  as they may be cited,  referenced and amended from
time to time; (c) any rules or regulations promulgated under or adopted pursuant
to the above federal and state laws; and (d) any other  federal,  state or local
statute or any requirement,  rule, regulation,  code, ordinance or order adopted
pursuant  thereto,  including,   without  limitation,   those  relating  to  the
generation, transportation, treatment, storage, recycling, disposal, handling or
release of Hazardous Substances.

     "ERISA"  means the Employee  Retirement  Income  Security  Act of 1974,  as
amended from time to time,  and the  regulations  and published  interpretations
thereof.

     "ERISA Affiliate" means any trade or business (whether or not incorporated)
which  together with the Borrower  would be treated as a single  employer  under
Section 4001 of ERISA.

     "Eurodollar Business Day" means a day on which, in the determination of the
Administrative Agent, significant dealings are carried on in the LIBOR Market.

     "Event of Default"  means any of the events  specified  in Section  7.01 of
this Agreement.

     "Excess Cash Flow" means, during any calendar quarter, without duplication,
net income  after cash taxes due and paid during  such  quarter,  plus  non-cash
charges,  depreciation,  depletion and  amortization,  minus  non-cash  credits,
Permitted Capital  Expenditures,  any Personal Tax Distribution paid by Borrower
in cash  during  such  quarter and any cash  deposited  by Borrower  during such
quarter into the Tax Accrual Account  pursuant to Section 5.36, any cash payment
required to be made and actually paid by Borrower  during such quarter  pursuant
to its Senior  Subordinated Note Guaranty,  required  principal  payments on the
Term Loan pursuant to Section  2.08(A),  and interest paid on the Loans for such
quarter.

     "Facility LC" is defined in Section 2.20(A).

     "Facility LC Application" is defined in Section 2.20(C).

     "Facility  Termination  Date" means  September  30,  2006,  as the same may
subsequently be amended pursuant to Section 2.23.

     "Federal Funds Effective Rate" means,  for any day, the weighted average of
the rates on overnight  Federal funds  transactions  with members of the Federal
Reserve System  arranged by Federal funds  brokers,  as published by the Federal
Reserve Bank of New York for such day on the next succeeding Business Day or, if
such rate is not so published  for any day which is a Business  Day, the average
of  the   quotations  for  the  day  of  such   transactions   received  by  the
Administrative  Agent from three Federal  funds  brokers of recognized  standing
selected by it.

     "Financial  Statements" means the statements of the financial  condition of
the indicated Person,  on a consolidated  basis, as at the point in time and for
the  period  indicated  and  consisting  of at  least a  balance  sheet,  income
statement  and  statement  of cash flows,  and when the  foregoing  are audited,
accompanied by the certification of such Person's  independent  certified public
accountants  and  footnotes  to any of the  foregoing,  all of  which  shall  be
prepared in accordance with GAAP applied on a basis  consistent with that of the
preceding year, except for any  inconsistency  that results from changes in GAAP
from year to year.

     "Floating  Rate" means a per annum interest rate determined by reference to
the following schedule:

     o    LIBOR + LIBOR Margin at Borrower's option pursuant to Section 2.04, or
          RR + RR Margin

     o    After  the  occurrence  and  during  the  continuation  of an Event of
          Default,  the Floating Rate determined in accordance with the forgoing
          schedule  shall,  in each case, be increased by three percent (3%) per
          annum, not to exceed the Maximum Rate.

     "Fronting Bank" means Union Bank of California, N.A., and each successor to
such position.

     "GAAP"  means  generally  accepted  accounting  principles,  applied  on  a
consistent basis, as set forth in Opinions of the Accounting Principles Board of
the American  Institute of Certified Public  Accountants and/or in statements of
the Financial Accounting Standards Board and/or their respective  successors and
which are applicable as of the date of Closing,  except that solely for purposes
of the definition of Financial  Statements herein,  changes in GAAP from time to
time (if any)  shall be  applied  and  reflected  in the  Financial  Statements.
Accounting  principles  are applied on a "consistent  basis" when the accounting
principles  observed in a current period are comparable in all material respects
to those accounting principles applied in a preceding period.

     "Governing  Body"  means,  in the  case  of a  corporation,  its  board  of
directors,  in the case of a  limited  liability  company,  its  members  or its
managers,  depending on how the management of such Business  Entity is allocated
in its Governing  Documentation,  in the case of a general  partnership or joint
venture, the partners or the joint venturers thereof,  respectively, in the case
of a limited  partnership,  the applicable Governing Body of the general partner
thereof,  if such general partner is a Business  Entity,  and in the case of any
other Business Entity not specified herein, the designees thereof that, pursuant
to  the  Governing   Documentation   of  such  Business   Entity,   fulfill  the
responsibilities typically discharged by a board of directors of a corporation.

     "Governing  Documentation"  means,  in  the  case  of  a  corporation,  its
certification  of  incorporation,  articles  of  incorporation  and by laws,  as
amended,  in the  case  of a  limited  liability  company,  its  certificate  of
formation,  its limited liability company agreement, and its operating agreement
or regulations (or similar  documentation  as denominated  under the laws of the
jurisdiction in which it is formed), in the case of a partnership, joint venture
or a limited partnership,  the applicable partnership agreement or joint venture
agreement, and the certificate of limited partnership, if applicable, and in the
case of any other  Business  Entity  not  specifically  enumerated  herein,  the
applicable  documentation  typically  utilized  in the  jurisdiction  where such
Business Entity has been formed for purposes of initially  forming such Business
Entity according to the laws of such  jurisdiction and thereafter  operating and
managing such Business Entity.

     "Great Plains  Pipeline  System" means those  certain  Pipeline  Properties
acquired by Borrower pursuant to that Purchase and Sale Agreement dated July 18,
2003, by and between Great Plains Pipeline Company and Borrower.

     "Hazardous Substances" means flammables, explosives, radioactive materials,
hazardous wastes, asbestos or any material containing asbestos,  polychlorinated
biphenyls (PCBs), toxic substances or related materials, petroleum and petroleum
products  and  associated  oil  or  natural  gas  exploration,   production  and
development  wastes  or  any  substances  defined  as  "hazardous   substances",
"hazardous  materials",  "hazardous  wastes"  or  "toxic  substances"  under the
Comprehensive  Environmental  Response,   Compensation  and  Liability  Act,  as
amended,  the Superfund  Amendments  and  Reauthorization  Act, as amended,  the
Hazardous Materials  Transportation Act, as amended,  the Resource  Conservation
and Recovery Act, as amended,  the Toxic Substances Control Act, as amended,  or
any other  Environmental  Laws now or hereafter  enacted or  promulgated  by any
regulatory  authority or governmental  body, but only to the extent any such law
is or becomes applicable to the Borrower or any of its property.

     "Hedge Agreement" means any swap agreement,  cap, collar,  floor,  exchange
transaction,  forward  agreement or exchange or protection  agreement related to
Hydrocarbons  or  any  option  with  respect  to  such   transaction,   as  more
specifically  provided in those certain master swap agreements on  International
Swap Dealers  Association  forms and the schedules thereto and any confirmations
thereunder entered into by Borrower with any other Person.

     "Hydrocarbons"  means  crude oil,  condensate,  natural  gas,  natural  gas
liquids and other hydrocarbons.

     "Increased  Costs" has the meaning  stated  therefor in Section 2.10 (A) of
this Agreement.

     "Indebtedness"  means,  as to any Person,  (a) all items of indebtedness or
liability for borrowed money which in accordance  with GAAP would be included in
determining  total liabilities as shown on the liability side of a balance sheet
as at the date as of which  Indebtedness is to be determined,  (b)  indebtedness
secured by (or for which the holder of such indebtedness has a right, contingent
or  otherwise,  to be secured by) any  mortgage,  deed of trust,  pledge,  lien,
security  interest,  or other charge or  encumbrance  existing on or encumbering
property owned by the Person whose Indebtedness is being determined,  whether or
not the  indebtedness  secured  thereby  shall  have been  assumed,  and (c) all
indebtedness of others which such Person has directly or indirectly  guaranteed,
endorsed  (otherwise  than for  collection or deposit in the ordinary  course of
business),  discounted  with  recourse,  agreed  (contingently  or otherwise) to
purchase or repurchase or otherwise acquire,  or in respect of which such Person
has agreed to supply or  advance  funds  (whether  by way of loan,  purchase  of
securities or capital contribution,  through a commitment to pay for property or
services  regardless of the nondelivery of such property or the nonfurnishing of
such  services or  otherwise),  or in respect of which such Person has otherwise
become directly or indirectly  liable,  contingently  or otherwise,  whether now
existing or hereafter arising.

     "Interest  Period" means as to any LIBOR Loan the period  commencing on and
including  the  date of such  Loan  (or on the  effective  date of the  election
pursuant  to Section  2.04(B) by which such Loan became a LIBOR Loan) and ending
on and  including the day preceding  the  numerically  corresponding  day (or if
there is no such numerically  corresponding  day, the last day) in the 1st, 2nd,
3rd or 6th  calendar  month  after the date of such  Loan,  as  selected  by the
Borrower in accordance with Section 2.04(B), and after such selected month, such
period commencing on and including the day immediately following the last day of
the then ending  Interest  Period for such Loan and ending on and  including the
day  preceding  the  day  numerically  corresponding  to the  first  day of such
Interest Period (or if there is no such numerically  corresponding day, the last
day),  in the 1st,  2nd, 3rd or 6th  calendar  month after the first day of such
Interest Period, as so selected by the Borrower;  provided, however, that if any
Interest Period would otherwise end on a day immediately  prior to a day that is
not a  Business  Day it shall be  extended  so as to end on the day  immediately
prior to the next  succeeding  Business  Day  unless  the same  would  fall in a
different  calendar  month,  in which case such Interest Period shall end on the
day immediately preceding the first Business Day immediately preceding such next
succeeding Business Day.

     "Investment" in any Person means any stock, bond, note or other evidence of
Indebtedness  or any other  security  (other  than  current  trade and  customer
accounts) of, or loan to, such Person.

     "Laws"  means  all  ordinances,   statutes,  rules,  regulations,   orders,
injunctions,  writs,  or decrees of any  government or political  subdivision or
agency thereof, or any court or similar entity established by any thereof.

     "Lead Arranger" means Union Bank of California, N.A., and each successor to
such position.

     "LC Fee" is defined in Section 2.20(D).

     "LC Issuer" has the meaning set forth in the preamble of this Agreement.

     "LC Obligations" means, at any time, the sum, without  duplication,  of (i)
the aggregate  undrawn stated amount under all Facility LCs  outstanding at such
time plus (ii) the  aggregate  unpaid  amount at such time of all  Reimbursement
Obligations.

     "LC Payment Date" is defined in Section 2.20(E).

     "Leases"  means oil and gas  leases  and all oil,  gas and  mineral  leases
constituting any part of the Collateral Assets.

     "LIBOR" means,  with respect to each Interest Period,  the rate of interest
per annum at which  deposits  of not less than  $1,000,000.00  in United  States
dollars are offered in the LIBOR Market for a period of time equal or comparable
to such Interest Period and in an amount equal to or comparable to the principal
amount of the LIBOR Loan to which such Interest  Period  relates as appearing on
Telerate Page 3750 as of 11:00 AM (London time) two (2) Business Days before the
first day of the applicable  Interest Period,  as adjusted for maximum statutory
reserves, provided, however, that if such rate is not available on the Telerate,
then  within  five  (5)   Business   Days  of  receipt  of   notification,   the
Administrative  Agent and the Borrower shall enter into good faith  negotiations
for a period of fifteen  (15) days (or such  shorter  period as is  required  to
agree to the alternative  basis) with a view to agreeing on an alternative basis
for  determining  the rate of  interest  applicable  to LIBOR  Loans,  and if no
alternative  basis is agreed within the fifteen (15) day period,  the LIBOR Loan
shall  be  deemed  to have  converted  to an RR  Loan as of the end of the  last
Interest Period.

     "LIBOR Loan" means any Loan from time to time for which interest thereon is
to be  computed  at a Floating  Rate based on LIBOR  plus the LIBOR  Margin,  as
elected by Borrower pursuant to Section 2.04 hereof.

     "LIBOR  Margin" means the  applicable  margin set forth in the Pricing Grid
under the caption, "LIBOR Margin," determined based on the Senior Debt to EBITDA
Ratio prevailing from time to time.

     "LIBOR  Market"  means the London  interbank  offered  interest rate market
created by major London clearing banks for deposits in United States dollars.

     "Limitation  Period" means any period while any amount remains owing on the
Notes when interest on such amount, calculated at the applicable rate prescribed
on the Notes,  plus any fees payable  hereunder and deemed to be interest  under
applicable Law, would exceed the Maximum Rate.

     "Loan" means,  singly, any advance by the Banks to the Borrower pursuant to
this Agreement and "Loans" means,  cumulatively,  the aggregate sum of all money
advanced by the Banks to the Borrower pursuant to this Agreement.

     "Loan  Documents"  means  this  Agreement,   the  Notes,  the  Facility  LC
Applications, the Security Instruments, and all other promissory notes, security
agreements,  and other  instruments,  documents,  and  agreements  executed  and
delivered pursuant to or in connection with this Agreement, as such instruments,
documents,  and  agreements  may be amended,  modified,  renewed,  extended,  or
supplemented from time to time.

     "Material  Adverse  Change"  means any  change in the  business,  property,
condition  (financial  or  otherwise)  or results of  operations,  or reasonably
foreseeable prospects of Borrower which has a Material Adverse Effect, excluding
any change in prevailing  economic or business  conditions  that are applicable,
generally, to companies engaged in the gas gathering,  compression, purchase and
sale business in the continental United States,  including,  without limitation,
fluctuations in gathering and compression fees and the resale margin realized by
the reseller in its purchase and resale of natural gas.

     "Material  Adverse  Effect"  means a  material  adverse  effect  on (i) the
business, property,  condition (financial or otherwise),  results of operations,
or reasonably foreseeable prospects of Borrower, (ii) the ability of Borrower to
perform its  obligations  under the Loan  Documents  to which it is a party,  or
(iii) the validity or  enforceability of any of the Loan Documents or the rights
or remedies of any of the Bank Parties thereunder.

     "Material Contracts" is defined in Section 4.16.

     "Maximum Rate" means the maximum rate of  non-usurious  interest  permitted
from day to day by Applicable  Law,  including  Chapter 303 of the Texas Finance
Code (and as the same may be incorporated by reference in other Texas statutes),
but otherwise  without  limitation,  that rate based upon the "indicated  weekly
rate ceiling."

     "Modify" and "Modification" are defined in Section 2.20(A).

     "Multi-employer Plan" means a plan described in Section 4001(a)(3) of ERISA
which covers employees of the Borrower or any ERISA Affiliate.

     "Net Income" means, for any period, without duplication, the net income (or
loss) of Borrower  after  allowances  for taxes for such period,  determined  in
accordance with GAAP; provided that there shall be excluded from such net income
(to the extent otherwise included therein) the following:  (i) the net income of
any Person in which the Borrower has an interest  (which interest does not cause
the net income of such other  Person to be  consolidated  with the net income of
the  Borrower in  accordance  with GAAP),  except to the extent of the amount of
dividends or distributions  actually paid in such period by such other Person to
the Borrower; (ii) any extraordinary gains or losses,  including gains or losses
attributable to property sales not in the ordinary course of business, (iii) the
cumulative  effect of a change in accounting  principles,  and (iv) any gains or
losses attributable to writeups or writedowns of assets.

     "Note" and "Notes" means,  individually,  a Term Note or a Revolving  Note,
together with any and all further renewals, extensions for any period, increases
or  rearrangements  thereof,  and means  collectively all of such Term Notes and
Revolving Notes.

     "Obligations" means all obligations,  indebtedness,  and liabilities of the
Borrower to the Bank  Parties,  now  existing or  hereafter  arising  under this
Agreement  and the other Loan  Documents,  including,  but not  limited  to, the
Indebtedness evidenced by the Notes and the Reimbursement  Obligations,  and all
interest accruing thereon and all attorneys' fees and other expenses incurred in
the administration, enforcement or collection thereof.

     "Oil and Gas  Properties"  means fee,  leasehold  or other  interests in or
under mineral estates or oil, gas and other liquid or gaseous hydrocarbon leases
with respect to properties  situated in the United  States,  including,  without
limitation,   overriding  royalty  and  royalty   interests,   leasehold  estate
interests,  net profits interests,  production payment interests and mineral fee
interests,  and all  gathering  systems,  processing  plants,  compressors,  and
associated  facilities of any type  relating  thereto,  together with  contracts
executed in connection therewith and all tenements, hereditaments, appurtenances
and properties, real or personal, appertaining, belonging, affixed or incidental
thereto.

     "Outstanding Credit Exposure" means, as to any Bank at any time, the sum of
(i) the aggregate  principal amount of its Loans  outstanding at such time, plus
(ii) an amount equal to its Percentage Share of the LC Obligations at such time.

     "PBGC" shall mean the Pension  Benefit  Guaranty  Corporation or any entity
succeeding to any or all of its functions under ERISA.

     "Percentage  Share"  means,  as to any Bank,  a  fraction  (expressed  as a
percentage),  the numerator of which shall be such Bank's Commitment Amount, and
the  denominator  of which shall be the  Aggregate  Commitment  Amount stated on
Schedule 1.01(b) attached hereto.

     "Permitted Asset Sales" means (a) sales, leases, assignments,  transfers or
disposals,  in one or any  series  of  related  transactions,  of (i) all or any
portion of Borrower's  assets  (except for items included in clause (ii) of this
definition),  whether now owned or hereafter  acquired,  including  transfers to
Subsidiaries,  which, in the aggregate, do not exceed $400,000.00 in any rolling
four quarter period,  and (ii) Borrower's excess equipment that is not necessary
to  facilitate   Borrower's   ongoing   compliance  with  its   representations,
warranties,  and  covenants  set  forth  in this  Agreement;  and (b)  sales  of
Hydrocarbons in the ordinary course of business.

     "Permitted  Capital  Expenditures"  means  the  average  quarterly  capital
expenditure  amount  approved by the  Required  Banks based on  Borrower's  most
recent Budget submitted pursuant to Section 5.31 hereof.

     "Permitted Encumbrances" means:

     (A)  Liens for taxes,  assessments,  or similar  charges,  incurred  in the
          ordinary course of business that are not yet due and payable;

     (B)  Liens of mechanics, materialmen, warehousemen, carriers, or other like
          liens,  securing  obligations  incurred  in  the  ordinary  course  of
          business that are not yet due and payable;

     (C)  Pledges  or  deposits  in  connection  with  or  to  secure  workmen's
          compensation,  unemployment  insurance,  pensions  or  other  employee
          benefits;

     (D)  Encumbrances  consisting of covenants,  zoning  restrictions,  rights,
          easements,  liens or other  restrictions  on the use of real property,
          none of  which  materially  impairs  the use of such  property  by the
          Borrower  in the  operation  of its  business,  and  none of  which is
          violated in any material respect by existing or proposed operations;

     (E)  Liens of  operators  and/or  co-working  interest  owners  under joint
          operating agreements or similar contractual  arrangements with respect
          to the Borrower's  proportionate  share of the expense of exploration,
          development  and  operation of oil,  gas and mineral  leasehold or fee
          interests owned jointly with others, to the extent that same relate to
          sums not yet due;

     (F)  Statutory or contractual claims,  liens, or encumbrances to secure the
          payment or performance of the day to day  obligations of Borrower that
          arise in the normal course of Borrower's  gas gathering  business,  to
          the extent that the same relate to sums not yet due;

     (G)  The following, if the validity or amount thereof is being contested in
          good faith by appropriate and lawful proceedings,  so long as levy and
          execution  thereon have been stayed and continue to be stayed and they
          do not, in the  aggregate,  materially  detract  from the value of the
          property  of  Borrower,  or  materially  impair the use thereof in the
          operation of its business:

          (1)  Claims  or liens  for  taxes,  assessments,  or  charges  due and
               payable and subject to interest or penalty;

          (2)  Claims,  liens, and  encumbrances  upon, and defects of title to,
               real or personal  property,  including any attachment of personal
               or real property or other legal process prior to  adjudication of
               a dispute on the merits;

          (3)  Claims  or  liens  of   mechanics,   materialmen,   warehousemen,
               carriers, or other like liens; and

          (4)  Adverse judgments on appeal;

     (H)  Liens securing payment and performance of the Obligations;

     (I)  Liens securing purchase money  obligations  included in the definition
          of Permitted Indebtedness if such liens encumber only the property for
          which such purchase money obligation was incurred; and

     (J)  Inchoate liens in respect of royalty owners.

     "Permitted Hedge Agreement" means any Hedge Agreement which Borrower enters
into with or through a counterparty that has a credit rating of at least "A-" by
Standard  and Poors or "A3" by Moody's  Investment  Service,  together  with the
confirmations  which  Borrower  may  hereafter  enter into with or through  such
counterparty  covering, in the aggregate,  among all such Hedge Agreements,  not
more  than  seventy-five  percent  (75%)  of (i) the  Proved  Reserves  that are
attributable to Borrower's interest in the Collateral Assets and projected to be
produced during the term(s) of such Hedge  Agreement(s),  and (ii)  seventy-five
percent of the  residue gas to be sold by the  Borrower  at the  tailgate of its
processing  plants;  provided that the floor,  fixed or strike prices for oil or
gas, respectively, prescribed in any such Hedge Agreement must be at least equal
to or greater than the average of the prices for oil or gas, as applicable, then
being used by the  Arrangers  in their price decks  applicable  to  Availability
Amount determinations, which average prices shall be provided to Borrower within
five  (5)  Business  Days  after  written  request  therefor  from  Borrower  to
Arrangers.

     "Permitted Indebtedness" means:

     (A)  The Loans and Facility LCs;

     (B)  Unsecured  current accounts payable incurred in the ordinary course of
          business which are (i) not unpaid for more than ninety (90) days after
          the date of the  invoice  therefor,  or (ii) being  contested  in good
          faith by  appropriate  proceedings,  or (iii) the subject of usual and
          customary review and evaluation;

     (C)  Extensions  of  credit  from  suppliers  or  contractors  who  are not
          Affiliates of Borrower for the performance of labor or services or the
          provision  of supplies or  materials  under  applicable  contracts  or
          agreements   in  connection   with   Borrower's   customary   business
          activities, which are not overdue or are being contested in good faith
          by appropriate proceedings;

     (D)  Letters of credit or performance  bonds required to be obtained by the
          Borrower  in the normal  course of its  business  to assure the proper
          plugging  and  abandonment  of  oil  or  gas  drilling  or  production
          locations   or  bonds   required   by  any   governmental   agency  or
          instrumentality in the normal course of the Borrower's business;

     (E)  Income taxes payable that are not overdue or that are being  contested
          in good faith by  appropriate  and lawful  proceedings  provided  that
          Borrower is maintaining  adequate cash reserves for the payment of all
          such asserted income tax liability;

     (F)  Accrued abandonment  liabilities for abandonment  obligations that are
          not in default;

     (G)  The Senior Subordinated Note Guaranty; and

     (H)  Indebtedness arising out of Permitted Hedge Agreements.

     "Person"  means an individual,  company,  corporation,  partnership,  joint
venture,   limited  liability  company,   trust,   association,   unincorporated
organization or a government or any agency or political subdivision thereof.

     "Personal Tax Distribution" means during any calendar quarter that portion,
and only that portion, of the CRI shareholders' or Borrower's shareholders',  as
applicable,  allocable  share of federal and state income taxes that are payable
during  such  quarter  to the  corresponding  taxing  authority,  as  calculated
pursuant  to  Section  5.36  and  as  substantiated  by  such  documentation  as
Administrative Agent may reasonably require.

     "Pipeline  Properties"  means natural gas  transmission and gathering lines
and associated rights-of-way,  easements, permits, licenses, surface leases, fee
acreage, and all pipeline facilities,  fixtures,  and appurtenances thereto, and
all  processing  plants,  compressors,  and  associated  facilities  of any type
relating thereto, including, without limitation, all gathering,  transportation,
processing, purchase and sale, and other contracts associated therewith, and all
tenements,  hereditaments,  appurtenances  and  properties,  real  or  personal,
tangible or intangible appertaining, belonging, affixed or incidental thereto.

     "Plan" means,  at any time,  any employee  benefit plan which is covered by
ERISA and in respect of which the  Borrower  or any ERISA  Affiliate  is (or, if
such plan were  terminated  at such time,  would under  Section 4069 of ERISA be
deemed to be) an "employer" as defined in Section 3(5) of ERISA.

     "Pricing Grid" means the following table:

  =========================== ============ ========= ============== ======
  Senior Debt to EBITDA Ratio LIBOR Margin RR Margin Commitment Fee LC Fee
  --------------------------- ------------ --------- -------------- ------
             >3.00                3.00%      0.75%        .500%     2.00%
  --------------------------- ------------ --------- -------------- ------
   >2.50 and is less than or
         equal to 3.00            2.75%      0.50%        .500%     2.00%
  --------------------------- ------------ --------- -------------- ------
   >2.00 and is less than or
         equal to 2.50            2.50%      0.25%        .500%     2.00%
  --------------------------- ------------ --------- -------------- ------
     is less than or equal
          to 2.00                 2.25%      0.00%        .375%     2.00%
  =========================== ============ ========= ============== ======

     For  purposes  of  determining  the  applicable  LIBOR  Margin,  RR Margin,
Commitment Fee and/or LC Fee at any time,  the applicable  Senior Debt to EBITDA
Ratio shall be determined  based on the most recently  completed fiscal quarter,
as of the end of such quarter,  provided  that until the first such  calculation
can be made as of December 31,  2003,  such  determinations  shall be made as if
such Ratio were >2.00 and is less than or equal to 2.50.

     "Prohibited  Transaction" means any transaction set forth in Section 406 of
ERISA or Section 4975 of the Internal Revenue Code of 1954, as amended from time
to time.

     "Proved Reserves" means the estimated  quantities of crude oil, condensate,
natural  gas  liquids and natural  gas which  geological  and  engineering  data
demonstrate  with  reasonable  certainty to be  recoverable in future years from
known reservoirs  underlying lands or interests therein constituting Oil and Gas
Properties, under existing economic and operating conditions, using the criteria
and  parameters  required  by and  acceptable  to the  Securities  and  Exchange
Commission,  provided  that with respect to estimated  quantities  of crude oil,
condensate,  natural gas liquids  and natural gas  expected to be produced  from
secondary recovery  operations,  such determination shall be made using criteria
and parameters  generally  utilized by and  acceptable to Ryder Scott  Petroleum
Engineers,  Barnes & Click, Inc. or other petroleum engineers  acceptable to the
Arrangers.

     "Purchasing  Bank" shall have the meaning  assigned to that term in Section
9.05 hereof.

     "Reimbursement  Obligations"  means,  at any  time,  the  aggregate  of all
obligations of the Borrower then outstanding under Section 2.20 to reimburse the
LC  Issuer  for  amounts  paid by the LC Issuer  in  respect  of any one or more
drawings under Facility LCs.

     "Reportable  Event"  means any of the events  set forth in Section  4043 of
ERISA.

     "Request for  Advance"  means the written or verbal  (confirmed  in writing
within one (1) Business Day) request by the Borrower to the Administrative Agent
for an  advance by the Banks  pursuant  to this  Agreement,  which  Request  for
Advance  shall be in  substantially  the form  attached  hereto as Exhibit  "E,"
signed by an  authorized  officer  of the  Borrower  and which  shall  include a
statement  of the amount  requested to be  advanced,  the date of the  requested
advance and such other information as the Administrative Agent in its reasonable
discretion deems necessary.

     "Required  Banks" means, at any time,  Banks holding at least sixty-six and
two-thirds  percent  (66-2/3%)  of the  Aggregate  Commitment  Amount or, if the
Aggregate Commitment Amount has been terminated, Banks having at least sixty-six
and two-thirds  percent (66-2/3%) of the Aggregate  Outstanding Credit Exposure;
subject to the provisions of Section 9.13.

     "Required  Number" means: in the case of notices  hereunder (i) relative to
borrowings,  prepayments,  elections  of LIBOR  Loans,  selections  of  Interest
Periods for, or other  transactions  in respect of, LIBOR Loans:  by 10:00 a.m.,
Los  Angeles,  California  time on the third  Business Day prior to the proposed
activity;  or (ii) relative to all transactions in respect of RR Loans: the same
Business Day by 11:00 a.m., Los Angeles,  California time; it being  understood,
however,  that in the case of notices involving  transactions in respect of more
than one  type of Loan  (such as a  change  in type of Loan in  accordance  with
Section  2.04(B)),  "Required  Number"  means that number of days,  as indicated
above in respect of the Loans  involved,  which  would  constitute  the  longest
applicable period of time.

     "Revolving  Loan" means the Loan(s) advanced by Banks to Borrower from time
to time pursuant to Section 2.01(b) of this Agreement.

     "Revolving Loan Availability Amount" means, at any time, the lesser of:

     (A)  $5,000,000 or such greater amount as is established  from time to time
          pursuant to Section 2.6; or

     (B)  The amount computed pursuant to Section 2.6 on the Availability Amount
          Certificate most recently  delivered to, and accepted by, the Banks in
          accordance  with  this  Agreement  and equal to the  aggregate  of (1)
          eighty  percent (80%) of Eligible  Accounts of the Borrower;  plus (2)
          fifty  percent  (50%)  of  the  book  value  of the  Inventory  of the
          Borrower;  provided,  however,  that the  Banks may  exclude  from the
          Revolving Loan Availability  Amount all or a proportionate part of any
          particular  portion  of  the  Borrower's  Inventory  which  the  Banks
          reasonably  deem  ineligible  because its market value has declined or
          because the Banks otherwise  reasonably  consider the collateral value
          thereof to the Banks to be impaired or their  ability to realize  such
          value to be insecure.

     "Revolving Loan  Deficiency"  means,  at any point in time, the amount,  if
any, by which the sum of: (a) the  outstanding  balance of the Revolving  Loans,
plus (b) the LC Obligations; exceeds the Revolving Loan Availability Amount then
in effect.

     "Revolving Note" and "Revolving  Notes" means,  individually,  a promissory
note issued by Borrower  payable to the order of a Bank evidencing the Revolving
Loans made by that Bank pursuant to Section 2.01 hereof and being  substantially
in the form of the note  attached as Exhibit B-2 hereto,  together  with any and
all further  renewals,  extensions for any period,  increases or  rearrangements
thereof, and means collectively all of such Revolving Notes.

     "RR" means a fluctuating  reference rate of interest equal to the higher of
(i)  a  rate  per  annum  equal  to  the  reference  rate  of  interest  of  the
Administrative  Agent announced from time to time by Administrative Agent (which
is not necessarily  the lowest rate charged to any customer),  changing when and
as said reference rate changes,  and (ii) the sum of the Federal Funds Effective
Rate most recently determined by the Administrative  Agent plus one-half percent
(1/2%) per annum.

     "RR Loan" means any Loan from time to time for which interest thereon is to
be  computed  on the basis of the RR plus the RR Margin,  as elected by Borrower
pursuant to Section 2.04 hereof.

     "RR Margin" means the applicable margin set forth in the Pricing Grid under
the caption,  "RR Margin,"  determined  based on the Senior Debt to EBITDA Ratio
prevailing from time to time.

     "Security  Instruments" means the security instruments described on Exhibit
"D," in form and  substance  satisfactory  to the  Administrative  Agent,  to be
executed by Borrower pursuant to Section 3.01,  together with all Borrower's CRI
Security  Instruments and any and all other  instruments or documents  hereafter
executed  in  connection  with or as  security  for the payment of the Notes and
performance of the Obligations.

     "Senior Debt to EBITDA  Ratio"  means,  at any time,  the ratio of: (a) the
Aggregate  Outstanding  Credit  Exposure as of such time,  to (b) EBITDA for the
most recent  rolling four quarter  period,  determined as of the end of the most
recently completed fiscal quarter.

     "Senior Subordinated Notes" means those certain $150,000,000, 10.25% Senior
Subordinated Notes issued by CRI due August 2008.

     "Senior  Subordinated  Note Guaranty" means Borrower's  guaranty  agreement
dated July 24, 1998,  pursuant to which  Borrower  guaranteed the payment of the
Indebtedness evidenced by the Senior Subordinated Notes.

     "Stockholders'  Equity"  means,  at any  time,  the  sum  of the  following
accounts set forth on a consolidated balance sheet of the Borrower,  prepared in
accordance  with GAAP:  (A) the par or stated value of all  outstanding  capital
stock (common and preferred); (B) capital surplus including paid in capital; and
(C) retained earnings, excluding any non-cash items.

     "Subsidiary" means, as to any Person, any corporation in which such Person,
directly or indirectly  through its  Subsidiaries,  owns more than fifty percent
(50%) of the stock of any class or  classes  having  by the  terms  thereof  the
ordinary voting power to elect a majority of the directors of such  corporation,
and any partnership,  limited partnership,  association, joint venture, or other
entity in which such Person,  directly or indirectly  through its  Subsidiaries,
has more than a fifty percent (50%) equity interest at the time.

     "Super-Majority"  means, at any time,  Banks holding at least  seventy-five
percent (75%) of the Aggregate Commitment Amount or, if the Aggregate Commitment
Amount has been terminated,  Banks having at least seventy-five percent (75%) of
the Aggregate Outstanding Credit Exposure;  subject to the provisions of Section
9.13.

     "Syndication Agent" means Fortis Capital Corp. as Syndication Agent for the
Banks  hereunder  and  under  the  other  Loan  Documents,  and  each  successor
Syndication Agent.

     "Tax Accrual Account" has the meaning stated in Section 5.35.

     "Term Loan" means the Loan to be advanced by Banks to Borrower  pursuant to
Section 2.01(a) of this Agreement.

     "Term Loan Availability  Amount" means  $17,000,000,  as such amount may be
redetermined  from time to time pursuant to Section  2.06,  not to exceed at any
time $25,000,000.

     "Term Note" and "Term Notes" means, individually,  a promissory note issued
by  Borrower  payable to the order of a Bank  evidencing  the Term Loans made by
that Bank pursuant to Section 2.01 hereof and being substantially in the form of
the note  attached  as Exhibit  B-1  hereto,  together  with any and all further
renewals,  extensions for any period,  increases or rearrangements  thereof, and
means collectively all of such Term Notes.

     "Transfer  Order Letters" means the letters in lieu of division or transfer
orders, in form acceptable to the Administrative Agent.

     "Unmatured  Event of Default"  means any event or  occurrence  which solely
with the lapse of time or the  giving of notice or both will ripen into an Event
of Default.

     Undefined  Terms.   Undefined  financial  accounting  terms  used  in  this
Agreement shall be defined according to GAAP.

                                  Article II.

                         THE LOANS AND LETTERS OF CREDIT

     2.01 The Commitment.

     (a) At the Closing, subject to satisfaction of the applicable conditions to
funding set forth in Article  III,  each Bank will  advance to the  Borrower its
respective Percentage Share of a Loan in the amount of Seventeen Million Dollars
($17,000,000.00) (the "Term Loan"). Thereafter, the Borrower may request and the
Banks may make additional  advances under the Term Loan not to exceed  aggregate
advances (inclusive of the Term Loan advanced at Closing) equal to the Term Loan
Availability Amount determined in accordance with Section 2.06. Amounts that are
advanced as a Term Loan and repaid may not be reborrowed.

     (b) From and including the date of this Agreement and prior to the Facility
Termination  Date, each Bank severally  agrees,  on the terms and conditions set
forth  in this  Agreement,  that in  addition  to the  Term  Loan(s)  to be made
pursuant  to  Section  2.01(a),  such Bank will (i) make  Loans to the  Borrower
("Revolving Loans") and (ii) participate in Facility LCs issued upon the request
of the Borrower,  provided that,  after giving effect to the making of each Loan
and the issuance of each Facility LC, such Bank's  Outstanding  Credit  Exposure
shall not exceed its  Commitment.  The Term Loans  advanced  by each Bank to the
Borrower  shall be  evidenced  by such  Bank's  respective  Term  Note  from the
Borrower,  and the Revolving  Loans  advanced by each Bank to Borrower  shall be
evidenced by such Bank's respective Revolving Note from the Borrower. Subject to
the terms of this Agreement,  the Borrower may borrow,  repay and reborrow up to
the  Revolving  Loan  Availability  Amount  at any time  prior  to the  Facility
Termination Date. All Commitments to extend credit hereunder shall expire on the
Facility Termination Date.

     (c) The LC  Issuer  will  issue  Facility  LCs  hereunder  on the terms and
conditions set forth in Section 2.20.

     2.02 Notice and Manner of Borrowing.

     (a) The amount and date of each Credit  Extension  shall be designated in a
Request for Advance executed by Borrower,  to be received by the  Administrative
Agent at least the Required Number of, but not more than ten (10), Business Days
prior to the date of such Credit Extension,  which date shall be a Business Day.
The Administrative Agent shall promptly advise the Banks and, if applicable, the
LC Issuer,  of any Request for Advance  given  pursuant to this Section 2.02, of
each Bank's Percentage Share of any requested Borrowing and, if applicable,  the
amount  requested  for any  Facility  LC by  telephone,  confirmed  promptly  in
writing, or telecopier. Upon satisfaction of the applicable conditions set forth
in Article III, each Borrowing shall be made at the office of the Administrative
Agent,  and shall be funded prior to 1:00 o'clock p.m., Los Angeles,  California
time, on the day so requested in  immediately  available  funds in the amount so
requested.

     (b) Each Bank shall make each Loan to be made by it  hereunder  on the date
of the proposed Borrowing by wire transfer of immediately available funds to the
Administrative Agent in Los Angeles,  California, not later than 10:00 a.m., Los
Angeles,  California time, and upon fulfillment of the applicable conditions set
forth in Article III, the Administrative Agent will make such funds available to
Borrower as Borrower shall direct to the Administrative  Agent from time to time
or, if a Borrowing shall not occur on such date because any condition  precedent
herein  specified shall not have been met, return the amounts so received to the
respective Banks as soon as practicable.  Unless the Administrative  Agent shall
have  received  notice from a Bank prior to the date of any  proposed  Borrowing
that such Bank will not make available to the  Administrative  Agent such Bank's
Percentage  Share of such Borrowing,  the  Administrative  Agent may assume that
such Bank has made its Percentage Share available to the Administrative Agent on
the  date of such  Borrowing  in  accordance  with  this  paragraph  (b) and the
Administrative  Agent may, in reliance upon such  assumption,  make available to
Borrower on such date a corresponding  amount.  If, and to the extent that, such
Bank shall not have made its Percentage  Share  available to the  Administrative
Agent,  such Bank and Borrower  severally  agree to repay to the  Administrative
Agent  forthwith on demand such  corresponding  amount  together  with  interest
thereon,  for each day from the date such amount is made  available  to Borrower
until the date such amount is repaid to the  Administrative  Agent at (i) in the
case of  Borrower,  the  interest  rate  applicable  at the  time  to the  Loans
comprising  such  Borrowing and (ii) in the case of such Bank, the Federal Funds
Effective  Rate.  If such Bank  shall  repay to the  Administrative  Agent  such
corresponding  amount,  such amount shall constitute such Bank's Loan as part of
such Borrowing for purposes of this Agreement.

     2.03 Payment Procedure. All payments and prepayments made by Borrower under
this  Agreement  shall  be made to the  Administrative  Agent at its  office  in
Monterey Park,  California for the account of the Banks in immediately available
funds before 10:00 a.m.,  Los Angeles,  California  time,  on the date that such
payment  is  required  to  be  made.  The  Administrative  Agent  will  promptly
thereafter  cause to be  distributed  like funds  relating  to such  payments or
prepayments  ratably to the Banks (and if the payment relates to amounts owed to
a particular Bank only, in like funds to such Bank), in each case, to be applied
in accordance with the terms of this Agreement.  Borrower hereby  authorizes the
Administrative  Agent,  if and to the extent  payment or  prepayment  (including
prepayments  required  pursuant  to  Section  2.11  hereof) is not made when due
hereunder or under the Notes or any other Loan Document,  to charge from time to
time against Borrower's account with the Administrative Agent any amount so due.
Any payment received and accepted by the Administrative  Agent (or any branch or
Affiliate  thereof)  after  such  time  shall  be  considered  for all  purposes
(including  the  calculation  of  interest,  to the extent  permitted by law) as
having been made on the next following Business Day.

     2.04  Payments  of  Interest  under  the  Notes.  Subject  to the terms and
provisions of this Agreement,  interest on the Loan,  calculated at the Floating
Rate, shall be due and payable as follows:

          (A)  Interest  on RR  Loans  shall  be  calculated  on the  basis of a
     365/366-day  year,  as  applicable,  and on LIBOR  Loans on the  basis of a
     360-day  year,  in each case  counting the actual  number of days  elapsed.
     Interest on the outstanding principal balance of the Loans shall accrue for
     each day at either a Floating  Rate based on RR plus the RR Margin for such
     day for RR Loans, or a Floating Rate based on LIBOR for the Interest Period
     which includes such day plus the LIBOR Margin for such day for LIBOR Loans,
     all as  elected  and  specified  (including  specification  as to length of
     Interest Period,  as permitted by the definition of that term, with respect
     to any  election  of a  Floating  Rate based on LIBOR) by the  Borrower  in
     accordance with Section 2.04(B); provided that:

               (1) In the absence of an  election by the  Borrower of a Floating
          Rate  based on LIBOR  plus the  LIBOR  Margin,  or,  having  made such
          election, but upon the Required Number of days prior to the end of the
          then current  Interest  Period the  Borrower  fails or is not entitled
          under the terms of this Agreement to elect to continue a Floating Rate
          based on LIBOR  plus the  LIBOR  Margin  and  specify  the  applicable
          Interest  Period  therefor,  then  upon the  expiration  of such  then
          current Interest  Period,  interest on the Loans shall accrue for each
          day at a  Floating  Rate  based on RR plus the RR Margin for such day,
          until the Borrower,  pursuant to Section  2.04(B),  elects a different
          Floating Rate and specifies the Interest Period for the Loans.

               (2)  Interest  accruing  on any LIBOR Loan  during  any  Interest
          Period  shall be payable on the first  Business Day after the last day
          of such Interest  Period except that:  (a) with respect to LIBOR Loans
          for which Borrower has selected an Interest  Period of six (6) months,
          interest  will be  payable on the first  Business  Day  following  the
          ninetieth  (90th) day after the  commencement  of such Interest Period
          and on  the  first  Business  Day of the  next  Interest  Period,  (b)
          interest will be payable on the Facility Termination Date on any LIBOR
          Loan with an Interest Period ending on the Facility  Termination Date;
          and provided that (c) all accrued interest on any LIBOR Loan converted
          or prepaid  pursuant to Section  2.11 shall be paid  immediately  upon
          such prepayment or conversion.

          (B) By at least the  Required  Number of days prior to the  advance of
     any Loan hereunder,  the Borrower shall select the initial Floating Rate to
     be charged on such Loan, and from time to time  thereafter the Borrower may
     elect,  on at least the Required Number of days  irrevocable  prior written
     (or verbal,  promptly  confirmed by written)  notice to the  Administrative
     Agent, an initial  Floating Rate for any additional  Loan, or to change the
     Floating  Rate on any Loan to any  other  Floating  Rate  (including,  when
     applicable,  the selection of the Interest Period);  provided that; (i) the
     Borrower  shall not  select an  Interest  Period  that  extends  beyond the
     Facility  Termination  Date;  (ii) except as otherwise  provided in Section
     2.11 no such  change  from a  Floating  Rate  based on LIBOR plus the LIBOR
     Margin to another  Floating Rate shall become effective on a day other than
     the day,  which must be a Business Day, next  following the last day of the
     Interest  Period last  effective  for such LIBOR Loan;  (iii) any elections
     made by the  Borrower  pursuant  to this  Section  2.04(B)  shall be in the
     amount of $1,000,000,  plus any additional increment of $1,000,000, or such
     lesser  amount as  constitutes  the  balance of all Loans then  outstanding
     hereunder;  (iv)  notwithstanding  anything  herein  to the  contrary,  the
     Borrower  may not make any election  under this Section  2.04(B) that would
     result in Loans  outstanding  based on more than six (6)  different  LIBORs
     without the consent of the  Required  Banks to do so; and (v) the first day
     of each Interest Period as to a LIBOR Loan shall be a Business Day.

          (C) Interest on RR Loans shall be paid monthly in arrears on the first
     Business Day of each calendar month (for the immediately  preceding  month)
     commencing  with the month following any month during which interest begins
     to accrue at a Floating Rate based on RR plus the RR Margin,  as elected by
     Borrower pursuant to Section 2.04(B), and on the date the principal of such
     Loans  shall  be  due  (on  the  stated  Facility   Termination   Date,  on
     acceleration, or otherwise).

     2.05 General  Provisions  Relating to Interest.  It is the intention of the
parties hereto to comply  strictly with the usury Laws of the State of Texas and
the United  States of America  and,  in this  connection,  there  shall never be
collected, charged or received on any sums advanced hereunder interest in excess
of the Maximum  Rate.  For purposes of Chapter 303 of the Texas Finance Code, as
amended,  the Borrower  agrees that the maximum rate to be charged  shall be the
"indicated (weekly) rate ceiling" as defined in said Chapter,  provided that the
Bank may also rely to the extent  permitted by  applicable  Laws of the State of
Texas or the United States of America,  on alternative maximum rates of interest
under  other  applicable  Laws of the  State of Texas or the  United  States  of
America applicable to the Loans, if greater.  Notwithstanding anything herein or
in the Notes to the contrary, during any Limitation Period, the interest rate to
be charged on amounts  evidenced  by the Notes shall be the Maximum Rate and the
obligation  of the  Borrower  for any fees  payable  hereunder  and deemed to be
interest under  applicable Law shall be suspended.  During any period or periods
of time  following a Limitation  Period,  to the extent  permitted by applicable
Laws of the State of Texas or the United States of America, the interest rate to
be charged  hereunder  shall remain at the Maximum Rate until such time as there
has been paid to each Bank (a) the amount of  interest  in excess of the Maximum
Rate that such Bank would have  received  during the  Limitation  Period had the
interest rate remained at the relevant rates  specified in the Note, and (b) all
interest  and  fees  otherwise  due to such  Bank  but for  the  effect  of such
Limitation Period.

     If under any circumstances the aggregate amounts paid on the Notes or under
this Agreement  include amounts which by Law are deemed interest and which would
exceed the amount  permitted  if the Maximum  Rate were in effect,  the Borrower
stipulates that such payment and collection will have been and will be deemed to
have been, to the extent  permitted by applicable  Laws of the State of Texas or
the United States of America,  the result of  mathematical  error on the part of
both the Borrower and the Banks,  and each Bank shall promptly refund the amount
of such excess (to the extent only of such interest  payments  above the Maximum
Rate which could  lawfully have been  collected and retained)  upon discovery of
such error by such Bank or notice thereof from the Borrower.

     2.06 Availability Amount  Determination.  The Availability Amount in effect
as of the Closing is Twenty-Two Million Dollars ($22,000,000.00), $17,000,000.00
of which is the Term Loan Availability  Amount and $5,000,000.00 of which is the
Revolving Loan Availability  Amount. The Term Loan Availability  Amount shall be
redetermined annually, or more often as provided hereinafter,  and the Revolving
Loan Availability Amount shall be redetermined monthly pursuant to the following
provisions of this Section.

          (a) Term Loan Availability  Amount. The Term Loan Availability  Amount
     shall be  automatically  reduced by the amount of any payments of principal
     that are due to be paid thereon, as and when such payments are due pursuant
     to Sections 2.08 and 5.36 hereof.  The Term Loan Availability  Amount shall
     be redetermined annually after Administrative Agent's receipt from Borrower
     of the Engineering Report and all other appropriate  information  requested
     by the Administrative  Agent,  pursuant to the following provisions of this
     Section.  Notwithstanding  anything in this Section 2.06(a) or elsewhere in
     this Agreement to the contrary,  upon any  redetermination of the Term Loan
     Availability Amount (other than automatic  reductions pursuant to the first
     sentence of this Section 2.06(a)),  such Term Loan Availability  Amount may
     be increased or maintained  at its  then-current  level,  but it may not be
     decreased.  On or before each  September 1 until the  Facility  Termination
     Date,  beginning  September  1, 2004,  the  Borrower  shall  furnish to the
     Administrative Agent information  sufficient to update to an effective date
     of the  immediately  preceding July 1, the most recent  Engineering  Report
     previously  provided  to the  Administrative  Agent  relative to the Proved
     Reserves  attributable  to the Oil and Gas  Properties  and the  discounted
     present  value of  future  cash  flows  estimated  to be  derived  from the
     Pipeline Properties.  The Borrower shall also provide to the Administrative
     Agent,   along  with  each   Engineering   Report,   such   information  as
     Administrative   Agent  may  request  in  its  sole  discretion   regarding
     historical and pro forma cash flow of the Borrower, margin and fee analysis
     of the Borrower's Collateral Assets including any contractual agreements of
     the Borrower, and additional information as requested in the Administrative
     Agent's sole discretion (collectively, the "Requested Credit Information").
     Upon  receipt  of  such   Engineering   Report  and  the  Requested  Credit
     Information,  the  Administrative  Agent  shall,  in the  normal  course of
     business,  make a determination of the Term Loan Availability Amount, which
     shall become effective upon unanimous  approval by the Banks and subsequent
     written  notification from the  Administrative  Agent to the Borrower,  and
     which, subject to the other provisions of this Agreement, shall be the Term
     Loan   Availability   Amount   until  the   effective   date  of  the  next
     redetermination  of the Term Loan Availability  Amount as set forth in this
     Section.  The Administrative Agent may, subject to approval of the Required
     Banks,  and must,  upon the  request of the  Required  Banks,  require  the
     delivery of an updated  Engineering Report and Requested Credit Information
     within thirty (30) days after written request to Borrower  therefor and may
     redetermine the Term Loan  Availability  Amount one additional time between
     any two scheduled redeterminations, which unscheduled redetermination shall
     become  effective  upon  unanimous  approval  by the Banks  and  subsequent
     written  notification  from the  Administrative  Agent to the  Borrower and
     which,  subject to the other  provisions of this Agreement.  Likewise,  the
     Borrower   may,  not  more  often  than  once  between  any  two  scheduled
     redeterminations of the Term Loan Availability  Amount,  provide an updated
     Engineering   Report  and  any   Requested   Credit   Information   to  the
     Administrative  Agent and request in writing a redetermination  of the Term
     Loan Availability  Amount,  and upon receipt of such Engineering Report and
     the Requested Credit  Information,  the Administrative  Agent shall, in the
     normal  course  of  business,   make  a  determination  of  the  Term  Loan
     Availability  Amount,  which shall become effective upon unanimous approval
     by the Banks and subsequent  written  notification from the  Administrative
     Agent to the Borrower.

          The Term Loan Availability  Amount shall represent the Required Banks'
     approval of the Administrative  Agent's  determination,  in accordance with
     their customary lending  practices,  of the maximum loan amount that can be
     supported  by the  Collateral  Assets and the  Borrower  acknowledges,  for
     purposes of this Agreement,  such determination by the Administrative Agent
     as  being  the  maximum  Term  Loan  amount  that can be  supported  by the
     Collateral  Assets.  In  making  any   redetermination  of  the  Term  Loan
     Availability  Amount,  the  Administrative  Agent and the other Banks shall
     apply the parameters and other credit factors  consistently  applied,  then
     generally  being utilized by the  Administrative  Agent and each such Bank,
     respectively,  for Term Loan Availability Amount redeterminations for other
     similarly situated  borrowers.  The Borrower,  Banks and the Administrative
     Agent  acknowledge  that  (a) due to the  uncertainties  of the oil and gas
     extraction  process,  the  Collateral  Assets are not subject to evaluation
     with a  high  degree  of  accuracy  and  are  subject  to  potential  rapid
     deterioration  in value,  and (b) for this reason and the  difficulties and
     expenses  involved in  liquidating  and  collecting  against the Collateral
     Assets, the Administrative  Agent's  determination of the maximum Term Loan
     amount that can be supported by the  Collateral  Assets  contains an equity
     cushion,  which equity cushion is acknowledged by the Borrower as essential
     for the adequate protection of the Banks.

          (b) Revolving Loan Availability Amount. Within fifteen (15) days after
     the end of each  calendar  month  Borrower  shall submit to  Administrative
     Agent  in  such  form  and   detail  as  shall  be   satisfactory   to  the
     Administrative  Agent,  an aging,  as of the end of such month,  of (a) the
     then Eligible Accounts, (b) all other Accounts of the Borrower certified by
     the president or chief financial officer of the Borrower to be complete and
     correct. Within fifteen (15) days after the end of each calendar month (and
     at any additional time in the discretion of the Borrower or if any material
     deterioration in the Revolving Loan Availability  Amount would be disclosed
     thereby) Borrower shall also submit to Administrative Agent an Availability
     Amount  Certificate  as of the end of such  month (or as of a date not more
     than three (3) days prior to the date of any such  additional  Availability
     Amount   Certificate).   Each  Availability  Amount  Certificate  shall  be
     effective only as accepted by the Administrative Agent with the approval of
     the Required Banks (and with such revisions,  if any, as the Administrative
     Agent may require as a condition to such acceptance), such acceptance to be
     presumed  by the  Borrower  after  delivery  of  such  Availability  Amount
     Certificate,   unless  the  Administrative  Agent  otherwise  notifies  the
     Borrower  within  five (5)  Business  Days next  following  receipt of such
     Availability  Amount  Certificate,  whether  thereafter,   theretofore,  or
     contemporaneously  therewith, that such Availability Amount Certificate has
     not been accepted by the  Administrative  Agent or approved by the Required
     Banks.

     2.07 Mandatory  Prepayment Due to a Revolving Loan  Deficiency.  Within ten
(10) days after  receipt  of written  notice  from  Administrative  Agent that a
Revolving  Loan   Deficiency   exists  or  upon  the  completion  of  Borrower's
calculations  with  respect to an  Availability  Amount  Certificate  that would
establish a Revolving Loan Availability  Amount that would result in a Revolving
Loan Deficiency, Borrower shall either (i) prepay the principal of the Revolving
Note in an aggregate amount at least equal to such Revolving Loan Deficiency, or
(ii) elect within such period by written notice to Administrative Agent to repay
the Revolving Loan  Deficiency in six equal  consecutive  monthly  installments,
which shall be in addition to all other  principal  payments due pursuant to the
Agreement,  the first such monthly installment to be due contemporaneously  with
Borrower's  delivery  of  such  election  to  Administrative  Agent,  with  each
successive  installment  due on or before the same  numerical day of each of the
five successive  calendar months.  If during any such five-month  payment period
the Revolving Loan  Availability  amount  determined in accordance  with Section
2.06(b) shall be of such an amount that no Revolving Loan Deficiency exists, the
Borrower's obligation to make any further payment of the amounts otherwise to be
paid during the remainder of such five-month period shall terminate and cease.

     2.08 Other Mandatory Payments and Prepayments. The principal balance of the
Term Loan will be repaid on or before the last day of each  calendar  quarter in
quarterly installments of at least $607,143.00 per quarter,  commencing on March
31, 2004, through and including June 30, 2006, with a final payment equal to all
unpaid  principal and accrued,  unpaid  interest due and payable on the Facility
Termination Date. Additional quarterly payments on the Term Loan will be made on
or before the  twentieth  (20th)  Business  Day  following  the last day of each
calendar quarter in an amount equal to 75% of Borrower's Excess Cash Flow during
such quarter.  Such additional  quarterly payments out of Excess Cash Flow shall
be applied to the outstanding  principal balance of the Term Loan in the inverse
order of maturity.

     2.09  Prepayment and  Conversion.  Upon the Required Number of days written
notice to the  Administrative  Agent,  the Borrower may,  without the payment of
penalty or premium, prepay the principal of the Loans or voluntarily convert the
applicable  Floating Rate of any Loan prior to the termination of the applicable
Interest  Period in whole or in part,  from time to time. Any partial payment or
conversion of RR Loans,  other than as set forth in Section 2.08 above, shall be
made  in the  sum of not  less  than  $1,000,000,  and any  partial  payment  or
conversion of LIBOR Loans,  other than as set forth in Section 2.08 above, shall
be made in the sum of not less than  $1,000,000 or any  $1,000,000  increment in
addition thereto. With respect to any such prepayment or conversion of any LIBOR
Loan  the  Borrower  agrees  to  pay  to  the  Banks  upon  the  request  of the
Administrative  Agent such  amount or amounts as will  compensate  the Banks for
Breakage  Costs,  excluding,  however,  any such Breakage Costs resulting from a
payment or prepayment made more than sixty (60) days prior to the Administrative
Agent's request for payment of Breakage Costs.  The payment of any such Breakage
Costs to the Banks shall be made within  thirty (30) days of a request  therefor
from  Administrative  Agent.  If LIBOR cannot be  determined on the date of such
prepayment,  the  Administrative  Agent shall calculate  LIBOR by  interpolating
LIBOR  in  effect  immediately  prior to the  prepayment  and  LIBOR  in  effect
immediately after the prepayment.

     2.10 Increased Cost of Loans.

          (A) Notwithstanding any other provisions herein, if as a result of any
     regulatory change after the date hereof:

               (1)  the  basis  of  taxation  of  payments  to any  Bank  of the
          principal  of, or interest on, any LIBOR Loan or any other amounts due
          under this  Agreement  in respect of any such LIBOR Loan  (except  for
          taxes imposed on the overall net income or receipts of such Bank,  and
          franchise  or other taxes  imposed  generally  on such  Bank),  by the
          jurisdiction (or any political  subdivision therein) in which the Bank
          has its  principal  office  (if such other  taxes do not  specifically
          affect the cost to the Bank of making the Loans) is changed;

               (2)  any  reserve,   special  deposit,   or  similar  requirement
          (including   without   limitation   any  reserve   requirement   under
          regulations of the Board of Governors of the Federal  Reserve  System)
          against  assets of,  deposits  with,  or for the account of, or credit
          extended by such Bank,  is  imposed,  increased,  modified,  or deemed
          applicable; or

               (3) any other  condition  affecting  this  Agreement or any LIBOR
          Loan is imposed on such Bank or (in the case of LIBOR Loans) the LIBOR
          Market; and

     the result of any of the foregoing is to increase the actual direct cost to
     such Bank of making or  maintaining  any such LIBOR Loan (and such increase
     shall not have been compensated by a corresponding increase in the interest
     rate  applicable to the respective  Loans) by an amount deemed by such Bank
     to be material (such increases in cost and reductions in amounts receivable
     being herein called  "Increased  Costs"),  then the Borrower shall pay such
     Bank,  within thirty (30) days after its written  demand,  such  additional
     amount or amounts as will compensate  such Bank for those Increased  Costs.
     No Bank will demand to be compensated by Borrower for such Increased  Costs
     unless  such Bank  generally  makes such  demands  to its other  LIBOR Loan
     customers who are similarly  situated.  A certificate  of such Bank setting
     forth  the  basis  for  the  determination  of  such  amount  necessary  to
     compensate such Bank as aforesaid  (including a representation by such Bank
     that it is generally making demands as required by the preceding sentence),
     accompanied by documentation  showing reasonable support for such increased
     costs or reduced  sums  received by such Bank,  shall be  delivered  to the
     Borrower  and shall be  conclusive,  save for  manifest  error,  as to such
     determination and such amount. The affected Bank shall notify the Borrower,
     as  promptly  as  practicable  after  such Bank  obtains  knowledge  of any
     Increased  Costs or other sums  payable  pursuant to this  Section 2.10 and
     determines to request compensation  therefor,  or any event occurring after
     the Closing which will entitle such Bank to  compensation  pursuant to this
     Section;  provided that,  notwithstanding  anything herein to the contrary,
     the Borrower shall not be obligated for the payment of any Increased  Costs
     or other sums  payable  pursuant  to this  Section  2.10 to the extent such
     Increased  Costs or other sums  accrued more than 90 days prior to the date
     upon which the Borrower was given such notice.  If the Borrower is required
     to indemnify or pay additional  amounts pursuant to this Section 2.10, then
     the Bank will take such  action as in the  reasonable  judgment of the Bank
     (i)  will  eliminate  or  reduce  any such  additional  payment  which  may
     thereafter accrue and (ii) is not otherwise commercially unreasonable.  The
     Bank shall use its  reasonable  efforts to obtain in a timely  fashion  any
     refund, deduction or credit of any taxes paid or reimbursed by the Borrower
     pursuant to this Section 2.10. If the Bank receives a benefit in the nature
     of a  refund,  deduction  or  credit  (including  a refund in the form of a
     deduction  from or credit  against taxes that are otherwise  payable by the
     Bank) of any taxes with  respect to which the  Borrower  has made a payment
     under Section 2.10, the Bank agrees to reimburse the Borrower to the extent
     of the benefit of such refund,  deduction or credit promptly after the Bank
     reasonably  determines  that such  refund  deduction  or credit  has become
     final;  provided,  however,  that nothing contained in this paragraph shall
     require  the  Bank  to  make  available  its  tax  returns  (or  any  other
     information  relating to its taxes which it deems to be confidential) or to
     attempt to obtain any such refund, deduction or credit, which attempt would
     be inconsistent with any reporting  position otherwise taken by the Bank on
     its tax returns.

          (B) Notwithstanding the foregoing  provisions of this Section 2.10, in
     the event  that by reason of any  regulatory  change  any Bank  either  (i)
     incurs  Increased  Costs  based on, or  measured  by,  the  excess  above a
     specified  level  of  the  amount  of  a  category  of  deposits  or  other
     liabilities  of such Bank that includes  deposits by reference to which the
     interest rate on LIBOR Loans is determined as provided in this Agreement or
     a  category  of  extensions  of  credit  or other  assets of such Bank that
     includes LIBOR Loans or (ii) becomes  subject to restrictions on the amount
     of such a category of liabilities or assets that it may hold, then, if such
     Bank so elects by written  notice to the Borrower,  the  obligation of such
     Bank to make or convert Loans of any other type into LIBOR Loans  hereunder
     shall be  suspended  until the earlier of the date such  regulatory  change
     ceases to be in effect or the date the Borrower and such Bank agree upon an
     alternative method of determining the interest rate payable by the Borrower
     on LIBOR Loans, and all LIBOR Loans of such Bank then outstanding  shall be
     converted into an RR Loan (if not otherwise  prohibited  under the terms of
     this Agreement) at such Bank's option.

     2.11 Change of Law.  Notwithstanding  any other  provision  herein,  in the
event  that  any  change  in any  Applicable  Law or in  the  interpretation  or
administration  thereof  shall make it  unlawful  for the Banks to (i) honor any
commitment it may have  hereunder to make any LIBOR Loan,  then such  commitment
shall  terminate,  or (ii) maintain any LIBOR Loan,  then all LIBOR Loans of the
Banks then  outstanding  shall be repaid and  converted to RR Loans  (unless the
Banks'  obligations  to fund Loans  hereunder  has been  suspended  by any other
provisions of this  Agreement) at the Borrower's  option in accordance  with the
election procedures set forth in Section 2.04(B); provided,  however, that prior
to the effective date of such election,  interest shall be calculated at the RR.
Any  remaining  commitment  of the Banks  hereunder to make LIBOR Loans (but not
other Loans) shall be suspended so long as they are prohibited by any applicable
law. Upon the  occurrence  of any such change,  the  Administrative  Agent shall
promptly  notify the  Borrower  thereof,  and shall  furnish to the  Borrower in
writing evidence thereof certified by the Administrative Agent.

     Any repayment or conversion of any LIBOR Loan which is required  under this
Section 2.11 or under  2.04(B)  shall be effected by payment  thereof,  together
with accrued interest thereon, on demand, and concurrently there shall occur the
borrowing of the corresponding RR Loan as provided herein.

     If any  repayment  to the Banks of any LIBOR  Loan  (including  conversions
thereof)  is made under this  Section  2.11 on a day other than a day  otherwise
scheduled  for a payment of principal of or interest on such Loan,  the Borrower
shall pay to the Banks upon the request of the Administrative  Agent such amount
or amounts as will compensate the Banks for Breakage Costs, excluding,  however,
any such Breakage Costs resulting from a prepayment or conversion made more than
sixty (60) days  prior to the  Administrative  Agent's  request  for  payment of
Breakage  Costs.  The payment of any such  Breakage  Costs to the Banks shall be
made within thirty (30) days of a request therefor from Administrative Agent.

     2.12  Mitigation:  Mandatory  Assignment.  Each Bank  shall use  reasonable
efforts  to  avoid  or  mitigate  any  Increased   Cost  or  suspension  of  the
availability  of an interest rate under Sections 2.09 through 2.10 above, to the
greatest extent practicable (including transferring the Loans to another lending
office or Affiliate of a Bank) unless, in the opinion of such Bank, such efforts
would be likely to have an adverse  effect  upon it. In the event a Bank makes a
request to the Borrower for additional payments in accordance with Sections 2.09
or 2.10,  then,  provided that no Event of Default or Unmatured Event of Default
has  occurred  and is  continuing  at such time,  the  Borrower  may, at its own
expense and in its sole discretion,  require such Bank to transfer and assign in
whole (but not in part),  without  recourse,  all of its  interests,  rights and
obligations under this Agreement to an assignee which shall assume such assigned
obligations  (which  assignee  may  be  another  Bank,  if a Bank  accepts  such
assignment);  provided that (a) such assignment shall not conflict with any law,
rule or regulation or order of any court or other governmental authority and (b)
the Borrower or such assignee  shall have paid to the  Administrative  Agent for
the account of the assigning Bank in immediately  available  funds the principal
of and interest  accrued to the date of such payment on the portion of the Loans
hereunder  held by  such  assigning  Bank  and all  other  amounts  owed to such
assigning Bank hereunder,  including  amounts owed pursuant to Sections 2.09 and
2.10 hereof,  and such  assignment  shall  otherwise  comply with Section  9.05,
including  without  limitation  the  payment of the  assignment  fee  payable to
Administrative Agent under Section 9.05.

     2.13 Pro Rata  Treatment and Payments.  Each Borrowing by Borrower from the
Banks  hereunder,  each payment by Borrower on account of any fee  hereunder and
any reduction of the  Commitments  of the Banks shall be made pro rata according
to the respective  Percentage Shares of the Banks. Each payment  (including each
prepayment)  by Borrower on account of  principal  of and  interest on the Loans
shall be made pro rata according to the respective outstanding principal amounts
of the Loans then held by the Banks. The  Administrative  Agent shall distribute
such payments to the Banks promptly upon receipt in like funds as received.

     2.14 Sharing of Payments  and  Setoffs.  Each Bank agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
Borrower (pursuant to Section 7.05, Section 9.01 or otherwise),  including,  but
not  limited  to, a secured  claim  under  Section 506 of Title 11 of the United
States  Code or other  security or interest  arising  from,  or in lieu of, such
secured claim, received by such Bank under any applicable bankruptcy, insolvency
or  other  similar  law  or  otherwise,  or by  similar  means,  obtain  payment
(voluntary or  involuntary) in respect of any Loan or Loans (other than pursuant
to Section 2.10) as a result of which the unpaid principal  portion of its Loans
shall be proportionately  less than the unpaid principal portion of the Loans of
any other Bank, it shall  simultaneously  purchase from such other Banks at face
value a  participation  in the Loans of such other Banks,  so that the aggregate
unpaid principal amount of Loans and  participations  in Loans held by each Bank
shall be in the same proportion to the aggregate  unpaid principal amount of all
Loans  then  outstanding  as the  principal  amount of its  Loans  prior to such
exercise  of  banker's  lien,  setoff,  counterclaim  or other  event was to the
principal  amount of all Loans  outstanding  prior to such  exercise of banker's
lien, setoff,  counterclaim or other event; provided,  however, that if any such
purchase or purchases or adjustments shall be made pursuant to this Section 2.14
and the payment giving rise thereto shall thereafter be recovered, such purchase
or purchases or  adjustments  shall be rescinded to the extent of such  recovery
and the purchase price or prices or adjustment restored without interest.

     2.15  Commitment Fee. As  consideration  for the commitment of the Banks to
make Credit  Extensions to the Borrower  through the Facility  Termination  Date
pursuant to this  Agreement,  the Borrower  agrees to pay to the  Administrative
Agent for the account of the Banks within five (5)  Business  Days after the end
of each quarterly  period ending March 31, June 30, September 30 and December 31
of each year  (except  the first  period  shall be for a period of time from the
Closing to December 31, 2003) during the period  commencing  on the date of this
Agreement to and  including  the Facility  Termination  Date and at the Facility
Termination  Date, a commitment fee equal to the percentage per annum  specified
in the Pricing  Grid based on the Senior Debt to EBITDA  Ratio  (computed on the
basis of a year of 360 days)  multiplied by an amount equal to the daily average
excess, if any, of the Aggregate  Commitment Amount over the Outstanding  Credit
Exposure,  throughout  the period  from the date of this  Agreement  or previous
calculation date provided above, whichever is later, to the relevant calculation
date or the Facility Termination Date, as the case may be.

     2.16 Availability  Amount Increase Fee. To the extent that the Availability
Amount is increased to an amount that exceeds the largest amount of Availability
Amount  in  existence  at any  time  prior to such  increase,  a fee of one half
percent (0.50%) of the incremental  amount of any increases in the  Availability
Amount subsequent to Closing  ("Availability  Amount Increase Fee") shall be due
upon such increased  Availability  Amount becoming  effective.  The Availability
Amount  Increase  Fee shall be paid by Borrower  to  Administrative  Agent,  and
Administrative  Agent shall promptly  thereafter  remit to each Bank such Bank's
Percentage Share of such Availability Amount Increase Fee.

     2.17 Up-Front Fee. At Closing  Borrower shall pay to Agent, for the account
of the  Banks,  a fee  equal to  $165,000.00,  which is  three-quarters  percent
(0.75%) of the Availability  Amount in effect at Closing.  Administrative  Agent
shall promptly thereupon remit one-third of this Up-Front Fee to each Bank.

     2.18  Addition of  Collateral  Assets.  The Borrower may, from time to time
upon  written  notice to the  Administrative  Agent,  propose to add Oil and Gas
Properties and/or Pipeline  Properties of the Borrower to the Collateral Assets.
Any such proposal to add Oil and Gas  Properties  or Pipeline  Properties of the
Borrower to the Collateral Assets shall be accompanied by an Engineering  Report
applicable to such properties that conforms to the requirements of Section 2.06,
and evidence  sufficient to establish that Borrower has Defensible Title to such
Oil and Gas Properties and/or Pipeline  Properties,  and any such addition shall
become  effective  at such  time  as:  (a) the  Administrative  Agent,  with the
approval of all the Banks,  has made a determination  of the amount by which the
Term Loan Availability  Amount would be increased as the result of such addition
and (b) the conditions  set forth in Article III hereof,  to the extent they are
applicable to such additional Oil and Gas Properties and/or Pipeline  Properties
of the Borrower,  have been  satisfied.  In determining the increase in the Term
Loan Availability Amount pursuant to this Section,  the Administrative Agent and
the Banks shall  apply the  parameters  and other  credit  factors  consistently
applied then generally being utilized by the Administrative  Agent and each such
Bank,  respectively,  for Term Loan Availability Amount determinations for other
similarly situated borrowers.

     2.19 Adjustment to Aggregate  Commitment  Amount. At any time that Borrower
proposes to increase the Term Loan Availability  Amount by adding additional Oil
and Gas Properties and/or Pipeline  Properties to the Collateral Assets pursuant
to Section 2.18, Borrower may also request that Banks increase the amount of the
Aggregate  Commitment  Amount. At any time that Borrower makes such a request it
shall promptly provide  Administrative Agent with such financial  information as
Administrative   Agent  may  request  to  assist  the  Administrative  Agent  in
evaluating  such  request.  Following  the  receipt  of  such  information  from
Borrower,  the  Administrative  Agent shall, with the unanimous  approval of the
Banks in each Bank's sole discretion,  increase the Aggregate Commitment Amount,
which shall become effective upon written  notification from the  Administrative
Agent to Borrower of the new Aggregate  Commitment Amount. The Borrower may upon
written notice to Administrative Agent, not sooner than one hundred eighty (180)
days subsequent to the last such action by Borrower, amend the definition of the
Aggregate Commitment Amount by reducing the amount set forth in such definition.
Upon such reduction,  the Banks shall not be obligated to make Credit Extensions
in excess of such reduced  Aggregate  Commitment  Amount.  If and when the Banks
change the Aggregate  Commitment  Amount at Borrower's  request,  the commitment
fee,  as  determined  pursuant  to  Section  2.15 of this  Agreement,  shall  be
calculated using such changed amount for all of the calculation  period in which
such Aggregate Commitment Amount was changed.

     2.20 Facility LCs.

          (A) Issuance. The LC Issuer hereby agrees, on the terms and conditions
     set forth in this  Agreement,  to issue standby  letters of credit (each, a
     "Facility LC") and to renew, extend, increase, decrease or otherwise modify
     each Facility LC ("Modify,"  and each such action a  "Modification"),  from
     time to time from and including the date of this Agreement and prior to the
     Facility  Termination Date upon the request of the Borrower;  provided that
     immediately  after each such  Facility  LC is issued or  Modified,  (i) the
     aggregate  amount of the  outstanding LC Obligations  shall not exceed Five
     Million Dollars  ($5,000,000.00) and (ii) the Aggregate  Outstanding Credit
     Exposure shall not exceed the Aggregate  Commitment  Amount.  The aggregate
     amount  of the  outstanding  LC  Obligations,  from  time  to  time,  shall
     constitute a corresponding  reduction in the aggregate  amount of the Loans
     that may be outstanding  under the Revolving Loan  Availability  Amount. No
     Facility  LC shall have an expiry  date  later than the  earlier of (x) the
     thirtieth  (30th)  day  prior  to the  Facility  Termination  Date  and (y)
     eighteen (18) months after its issuance.

          (B) Participations. Upon the issuance or Modification by the LC Issuer
     of a Facility LC in accordance  with this Section 2.20, the LC Issuer shall
     be  deemed,   without   further  action  by  any  party  hereto,   to  have
     unconditionally  and irrevocably  sold to each Bank, and each Bank shall be
     deemed, without further action by any party hereto, to have unconditionally
     and  irrevocably  purchased  from the LC Issuer,  a  participation  in such
     Facility LC (and each Modification  thereof) and the related LC Obligations
     in proportion to its Percentage Share.

          (C) Notice. Subject to Section 2.20(A), the Borrower shall give the LC
     Issuer notice prior to 10:00 a.m. (Los Angeles,  California  time) at least
     five Business  Days prior to the proposed date of issuance or  Modification
     of each  Facility LC,  specifying  the  beneficiary,  the proposed  date of
     issuance  (or  Modification)  and the expiry date of such  Facility LC, and
     describing  the  proposed  terms of such  Facility LC and the nature of the
     transactions proposed to be supported thereby. Upon receipt of such notice,
     the LC Issuer  shall  promptly  notify the  Administrative  Agent,  and the
     Administrative  Agent  shall  promptly  notify each Bank,  of the  contents
     thereof and of the amount of such  Bank's  participation  in such  proposed
     Facility LC. The issuance or  Modification by the LC Issuer of any Facility
     LC shall, in addition to the conditions  precedent set forth in Article III
     (the  satisfaction of which the LC Issuer shall have no duty to ascertain),
     be subject  to the  conditions  precedent  that such  Facility  LC shall be
     satisfactory to the LC Issuer and that the Borrower shall have executed and
     delivered such  application  agreement  and/or such other  instruments  and
     agreements  relating  to  such  Facility  LC as the LC  Issuer  shall  have
     reasonably  requested (each, a "Facility LC Application").  In the event of
     any  conflict  between  the  terms of this  Agreement  and the terms of any
     Facility LC Application,  the terms of this Agreement  shall control.  Each
     notice  required or permitted to be given under this Section 2.20(C) by any
     party to any  other  party may be given by fax to the fax  contact  numbers
     specified for such party on Schedule 2.20(C) attached hereto.

          (D) LC Fees. The Borrower shall pay to the  Administrative  Agent, for
     the  account of the Banks  ratably  in  accordance  with  their  respective
     Percentage Shares, with respect to each Facility LC, a letter of credit fee
     at a rate as  specified  in the  Pricing  Grid based on the Senior  Debt to
     EBITDA  Ratio  applicable  at the  time  of  issuance  of the  Facility  LC
     (computed  on the basis of a year of 360 days),  but not less than  $500.00
     per  Facility LC per annum,  such fee to be payable in arrears on or before
     the first  Business Day of each calendar  month (each such fee described in
     this  sentence an "LC Fee").  The Borrower  shall also pay to the LC Issuer
     for its own  account (x) at the time of  issuance  of each  Facility  LC, a
     fronting fee calculated at the rate of twelve and five-tenths  (12.5) basis
     points  per  annum  pro-rated  over  the  term,  and  (y)  documentary  and
     processing  charges in connection  with the issuance or Modification of and
     draws  under  Facility  LCs in  accordance  with the LC  Issuer's  standard
     schedule for such charges as in effect from time to time.

          (E)  Administration;  Reimbursement  by Banks.  Upon  receipt from the
     beneficiary  of any  Facility  LC of any  demand  for  payment  under  such
     Facility LC, the LC Issuer shall  notify the  Administrative  Agent and the
     Administrative Agent shall promptly notify the Borrower and each other Bank
     as to the amount to be paid by the LC Issuer as a result of such demand and
     the proposed payment date (the "LC Payment Date").  The  responsibility  of
     the LC Issuer to the Borrower and each Bank shall be only to determine that
     the  documents  (including  each demand for payment)  delivered  under each
     Facility LC in connection with such  presentment  shall be in conformity in
     all material  respects with such Facility LC. The LC Issuer shall  endeavor
     to  exercise  the  same  care in the  issuance  and  administration  of the
     Facility  LCs as it does  with  respect  to  letters  of credit in which no
     participations are granted,  it being understood that in the absence of any
     gross negligence or willful misconduct by the LC Issuer, each Bank shall be
     unconditionally  and irrevocably liable without regard to the occurrence of
     any Default or any  condition  precedent  whatsoever,  to reimburse  the LC
     Issuer on demand for (i) such Bank's Percentage Share of the amount of each
     payment  made by the LC Issuer  under each  Facility  LC to the extent such
     amount is not reimbursed by the Borrower pursuant to Section 2.20(F) below,
     plus (ii) interest on the  foregoing  amount to be reimbursed by such Bank,
     for each day from the date of the LC Issuer's demand for such reimbursement
     (or, if such demand is made after 10:00 a.m. (Los Angeles, California time)
     on such date, from the next  succeeding  Business Day) to the date on which
     such Bank pays the amount to be reimbursed by it, at a rate of interest per
     annum equal to the Federal  Funds  Effective  Rate for the first three days
     and, thereafter,  at a rate of interest equal to the Floating Rate based on
     RR.

          (F)  Reimbursement by Borrower.  The Borrower shall be irrevocably and
     unconditionally  obligated  to  reimburse  the LC Issuer  on or before  the
     applicable LC Payment Date for any amounts to be paid by the LC Issuer upon
     any drawing under any Facility LC, without presentment,  demand, protest or
     other  formalities of any kind;  provided that neither the Borrower nor any
     Bank shall hereby be precluded from asserting any claim for direct (but not
     consequential) damages suffered by the Borrower or such Bank to the extent,
     but only to the  extent,  caused  by (i) the  willful  misconduct  or gross
     negligence  of the LC Issuer  in  determining  whether a request  presented
     under any Facility LC issued by it complied with the terms of such Facility
     LC or (ii) the LC Issuer's  failure to pay under any  Facility LC issued by
     it after the  presentation to it of a request  strictly  complying with the
     terms and  conditions  of such Facility LC. All such amounts paid by the LC
     Issuer and remaining unpaid by the Borrower shall bear interest, payable on
     demand,  for each day until paid at a rate per annum  equal to (x) the rate
     applicable  to RR Loans  for such day if such day  falls on or  before  the
     applicable  LC Payment Date and (y) the sum of 2% plus the rate  applicable
     to RR Loans for such day if such day falls after such LC Payment Date.  The
     LC Issuer will pay to each Bank ratably in accordance  with its  Percentage
     Share all  amounts  received by it from the  Borrower  for  application  in
     payment, in whole or in part, of the Reimbursement Obligation in respect of
     any  Facility LC issued by the LC Issuer,  but only to the extent such Bank
     has made  payment to the LC Issuer in respect of such  Facility LC pursuant
     to Section  2.20(E).  Subject to the terms and conditions of this Agreement
     (including  without  limitation  the submission of a Request for Advance in
     compliance  with  Section  2.02  and  the  satisfaction  of the  applicable
     conditions  precedent set forth in Article III), the Borrower may request a
     Loan hereunder for the purpose of satisfying any Reimbursement Obligation.

          (G)  Obligations  Absolute.  The  Borrower's  obligations  under  this
     Section  2.20  shall  be  absolute  and  unconditional  under  any  and all
     circumstances  and  irrespective of any setoff,  counterclaim or defense to
     payment which the Borrower may have or have had against the LC Issuer,  any
     Bank or any beneficiary of a Facility LC. The Borrower  further agrees with
     the LC Issuer and the Banks  that the LC Issuer and the Banks  shall not be
     responsible for, and the Borrower's  Reimbursement Obligation in respect of
     any Facility LC shall not be affected by, among other things,  the validity
     or genuineness of documents or of any  endorsements  thereon,  even if such
     documents  should  in  fact  prove  to be in any or all  respects  invalid,
     fraudulent or forged, or any dispute between or among the Borrower,  any of
     its  Affiliates,  the  beneficiary  of any  Facility  LC or  any  financing
     institution  or other party to whom any Facility LC may be  transferred  or
     any  claims  or  defenses  whatsoever  of  the  Borrower  or of  any of its
     Affiliates  against  the  beneficiary  of  any  Facility  LC  or  any  such
     transferee.  The LC Issuer  shall not be liable  for any  error,  omission,
     interruption or delay in transmission,  dispatch or delivery of any message
     or advice,  however  transmitted,  in connection  with any Facility LC. The
     Borrower  agrees  that any action  taken or omitted by the LC Issuer or any
     Bank under or in connection  with each  Facility LC and the related  drafts
     and  documents,  if done without gross  negligence  or willful  misconduct,
     shall be binding  upon the  Borrower and shall not put the LC Issuer or any
     Bank under any liability to the Borrower.  Nothing in this Section  2.20(G)
     is intended to limit the right of the Borrower to make a claim  against the
     LC Issuer for damages as  contemplated by the proviso to the first sentence
     of Section 2.20(F).

          (H) Actions of LC Issuer. The LC Issuer shall be entitled to rely, and
     shall be fully protected in relying,  upon any Facility LC, draft, writing,
     resolution,  notice, consent,  certificate,  affidavit,  letter, cablegram,
     telegram,  telecopy, telex or teletype message,  statement,  order or other
     document  believed by it to be genuine and correct and to have been signed,
     sent  or made  by the  proper  Person  or  Persons,  and  upon  advice  and
     statements  of legal  counsel,  independent  accountants  and other experts
     selected  by the LC  Issuer.  The LC  Issuer  shall be fully  justified  in
     failing or refusing to take any action under this Agreement unless it shall
     first have received such advice or  concurrence of the Required Banks as it
     reasonably  deems  appropriate  or it  shall  first be  indemnified  to its
     reasonable  satisfaction  by the Banks  against any and all  liability  and
     expense  which may be incurred by it by reason of taking or  continuing  to
     take any such action.  Notwithstanding  any other provision of this Section
     2.20, the LC Issuer shall in all cases be fully protected in acting,  or in
     refraining  from acting,  under this Agreement in accordance with a request
     of the Required Banks,  and such request and any action taken or failure to
     act pursuant thereto shall be binding upon the Banks and any future holders
     of a participation in any Facility LC.

          (I) Indemnification.  The Borrower hereby agrees to indemnify and hold
     harmless each Bank Party and their respective directors,  officers,  agents
     and  employees  from and  against any and all claims and  damages,  losses,
     liabilities,  costs or  expenses  which such Bank Party may incur (or which
     may be claimed against such Bank Party by any Person  whatsoever) by reason
     of or in connection  with the issuance,  execution and delivery or transfer
     of or  payment or  failure  to pay under any  Facility  LC or any actual or
     proposed use of any Facility LC, including, without limitation, any claims,
     damages,  losses,  liabilities,  costs or expenses  which the LC Issuer may
     incur by reason of or in connection  with (i) the failure of any other Bank
     to fulfill or comply with its  obligations to the LC Issuer  hereunder (but
     nothing  herein  contained  shall  affect any rights the  Borrower may have
     against any  defaulting  Bank) or (ii) by reason of or on account of the LC
     Issuer issuing any Facility LC which specifies that the term  "Beneficiary"
     included  therein  includes any  successor by operation of law of the named
     Beneficiary, but which Facility LC does not require that any drawing by any
     such successor  Beneficiary  be accompanied by a copy of a legal  document,
     satisfactory to the LC Issuer, evidencing the appointment of such successor
     Beneficiary;  provided that the Borrower shall not be required to indemnify
     any Bank  Party for any  claims,  damages,  losses,  liabilities,  costs or
     expenses to the extent,  but only to the extent,  caused by (x) the willful
     misconduct or gross  negligence of the LC Issuer in  determining  whether a
     request  presented  under any  Facility LC complied  with the terms of such
     Facility  LC or (y) the LC  Issuer's  failure to pay under any  Facility LC
     after the presentation to it of a request strictly complying with the terms
     and  conditions  of such  Facility LC.  Nothing in this Section  2.20(I) is
     intended to limit the obligations of the Borrower under any other provision
     of this Agreement.

          (J) Banks'  Indemnification.  Each Bank shall,  ratably in  accordance
     with its  Percentage  Share,  indemnify the LC Issuer,  its  affiliates and
     their respective directors,  officers,  agents and employees (to the extent
     not  reimbursed  by the  Borrower)  against  any cost,  expense  (including
     reasonable counsel fees and disbursements),  claim, demand, action, loss or
     liability (except such as result from such indemnitees' gross negligence or
     willful  misconduct or the LC Issuer's failure to pay under any Facility LC
     after the presentation to it of a request strictly complying with the terms
     and  conditions  of the  Facility LC) that such  indemnitees  may suffer or
     incur in  connection  with this Section 2.20 or any action taken or omitted
     by such indemnitees hereunder.

          (K) Rights as a Bank.  In its capacity as a Bank,  the LC Issuer shall
     have the same rights and obligations as any other Bank.

     2.21 Advances to Satisfy  Obligations of the Borrower.  The  Administrative
Agent or any Bank may, but shall not be obligated  to, make  advances  hereunder
for  the  benefit  of the  Banks  and  apply  same  to the  satisfaction  of any
condition,  warranty,  representation  or covenant of the Borrower  contained in
this Agreement,  and the funds so advanced and applied shall be part of the Loan
proceeds advanced under this Agreement and evidenced by the Notes.

     2.22 Assignment of Production. Certain of the Security Instruments covering
the Collateral  Assets contain an assignment unto and in favor of Administrative
Agent for the benefit of the Banks of all oil, gas and other  minerals  produced
and to be produced from or attributable  to the Collateral  Assets together with
all of the revenues  and  proceeds  attributable  to such  production,  and such
Security  Instruments  further provide that all such revenues and proceeds which
may be so  collected  by the  Administrative  Agent for the benefit of the Banks
pursuant to the assignment  shall be applied to the payment of the Notes and the
satisfaction  of  all  other   Indebtedness  to  be  secured  by  such  Security
Instruments.  The Borrower hereby appoints the Administrative Agent as its agent
and attorney-in-fact until this Agreement has been terminated in accordance with
Section  9.19 hereof for  purposes of  completing  the  Transfer  Order  Letters
delivered to the Administrative  Agent pursuant to Section 3.02(B) hereof, which
power is coupled with an interest and is not revocable.

     2.23 Facility Termination Date. The Bank Parties, acting unanimously and in
their  respective  sole  discretion,  may extend the Facility  Termination  Date
insofar as it relates to the  Revolving  Loan for  successive  one-year  periods
effective  in each  case  upon  written  notice  from  Administrative  Agent  to
Borrower.

                                  Article III.

                                   CONDITIONS

     The obligation of the Banks to make the Credit Extensions is subject to the
following conditions precedent:

     3.01 General Conditions to Closing and to all Disbursements. At the time of
the execution and delivery of this  Agreement by all parties who are  designated
as signatories on the signature  pages of this Agreement (the  "Closing") and at
each subsequent Credit Extension:

          (A) No Event of Default shall have occurred and be continuing,  and no
     Unmatured Event of Default shall have occurred;

          (B) The representations and warranties contained in Article IV of this
     Agreement shall be true and correct in all material respects as though such
     representations  and warranties had been made on such date,  except such as
     are  expressly  limited  to a prior  date,  which  shall have been true and
     correct in all material respects as of such prior date;

          (C) The Administrative  Agent and the Banks shall have been, and shall
     continue  to be,  satisfied,  in  their  good  faith  discretion,  that the
     Borrower  (individually  or  collectively)  holds  Defensible  Title to the
     Collateral  Assets,  and that such  ownership  includes  record title to an
     undivided  net  revenue  interest in the  production  from each Oil and Gas
     Property that is not less than, as well as an undivided working interest in
     each Oil and Gas  Property  that is not  greater  than  (unless  there is a
     corresponding increase in the net revenue interest attributed to such party
     therein),  the  net  revenue  interest  therein  and the  working  interest
     therein,  respectively,  attributed to the Borrower on Exhibit "A," subject
     to the  limitations  and  qualifications  on such exhibit (or attributed to
     Borrower in any Security Instrument  applicable to any Oil and Gas Property
     that is added to the  Collateral  Assets in connection  with any subsequent
     funding after the Closing);

          (D) No Material Adverse Change shall have occurred since June 30, 2003
     or, if later,  since the date of the latest  audited  Financial  Statements
     provided to the Administrative Agent;

          (E) All of the  Borrower's  CRI Security  Instruments  delivered  with
     respect to the  Collateral  Assets  shall have  remained  in full force and
     effect;

          (F)  Borrower  shall have entered into  Hydrocarbon  Hedge  Agreements
     acceptable to the Banks; and

          (G)  All  legal  matters   incidental   thereto  shall  be  reasonably
     satisfactory to legal counsel designated by the Administrative Agent.

     3.02  Deliveries at the Closing.  The Borrower shall have duly delivered or
caused   to  be   delivered   to  the   Administrative   Agent,   prior   to  or
contemporaneously with the Closing, the following:

          (A) The Notes payable to each respective Bank, along with the Security
     Instruments  covering each of the Collateral  Assets not already covered by
     the Borrower's CRI Security Instruments.

          (B) Transfer Order Letters applicable to the production of oil and gas
     from any  Collateral  Assets  for which  Transfer  Order  letters  have not
     previously been delivered to the Administrative Agent.

          (C) Security  Instruments  covering all Collateral Assets described on
     Exhibit A and amending and  restating in form and  substance  acceptable to
     the Administrative Agent the Borrower's CRI Security Instruments.

          (D) The  results  of a Uniform  Commercial  Code  search  showing  all
     financing statements and other documents or instruments on file against the
     Borrower  in the  Offices  of the  Secretaries  of  State  of the  State of
     Oklahoma,  the State of North Dakota,  and each other State in which any of
     the Collateral Assets are located or deemed to be located, and the counties
     and/or  parishes in which the Borrower  maintains  its  principal  place of
     business and in which any of the Collateral Assets are located, such search
     to be as of a date no more than ten (10) days prior to the date of Closing.

          (E) A certified (as of the date of the Closing) copy of resolutions of
     Borrower's  Governing  Body  authorizing  the  execution,   delivery,   and
     performance  of this  Agreement,  the Notes,  and each other document to be
     delivered pursuant hereto;

          (F) A  certificate  (dated  the  date of the  Closing)  of  Borrower's
     corporate  secretary as to the incumbency and signatures of the officers of
     the Borrower signing this Agreement,  the Notes, and each other document to
     be delivered pursuant hereto;

          (G) A copy,  certified as of the most recent date  practicable  by the
     Secretary  of State  of the  state in which  Borrower  was  formed,  of the
     Borrower's Certificate of Formation, together with a certificate (dated the
     date of the Closing) of the  Borrower's  corporate  secretary to the effect
     true and complete  copies of the  Borrower's  Governing  Documentation  are
     attached thereto and that such Governing Documentation has not been amended
     except as described therein;

          (H)  Certificates,  as of the most recent  dates  practicable,  of the
     aforesaid  Secretary of State,  and the Secretary of State of each state in
     which the  Borrower  is  qualified  as a foreign  Business  Entity  and the
     department  of revenue or taxation of each of the foregoing  states,  as to
     the good standing of the Borrower;

          (I) A Compliance Certificate, dated the date of the Closing;

          (J) Payment of the Administrative Agent's attorneys' fees upon receipt
     of a reasonably detailed invoice pursuant to Section 5.12 hereof;

          (K) A legal  opinion or opinions of outside  counsel to the  Borrower,
     addressed  to  the  Bank  Parties,   in  form  and   substance   reasonably
     satisfactory to the  Administrative  Agent,  covering,  among other matters
     reasonably  requested by Administrative  Agent or its counsel,  the matters
     addressed in Sections 4.01, 4.02, 4.03, 4.20 and 4.21 hereof;

          (L) An Amendment  to the CRI Credit  Agreement,  duly  executed by all
     Parties  thereto,  pursuant to which:  (i)  Borrower  is released  from its
     guaranty of CRI's  obligations  under the CRI Credit Agreement and (ii) the
     parties thereto agree that Borrower's  assets covered by the Borrower's CRI
     Security   Instruments  shall  no  longer   constitute   security  for  the
     obligations of CRI under the CRI Credit Agreement;

          (M) Duly executed assignments from the Collateral Agent, as defined in
     the CRI  Credit  Agreement,  to  Administrative  Agent  of  Borrower's  CRI
     Security   Instruments,   in  form  and  substance   satisfactory   to  the
     Administrative Agent;

          (N) A Barnes and Click  report  and  financial  projection  model with
     respect to Borrower that is acceptable to the Banks;

          (O) A Phase I  Environmental  Report or Reports  relating  to the real
     property  comprising  any  part  of the  Collateral  Assets  prepared  by a
     reputable  third-party  environmental firm in form and substance acceptable
     to the Lenders;

          (P) A pro-forma  balance sheet of Borrower  inclusive of  acquisitions
     occurring since June 30, 2003; and

     3.03 Documents Required for Subsequent  Disbursements  Involving Additional
Collateral Assets. As of the time of funding any additional advances to Borrower
that have been  approved by the Banks  pursuant to Section  2.01 and are made in
conjunction  with  the  addition  of Oil  and  Gas  Properties  and/or  Pipeline
Properties  owned by the Borrower to the Collateral  Assets,  the Borrower shall
have duly delivered to the  Administrative  Agent: (i) the Security  Instruments
that  are  necessary  or   appropriate,   in  the  reasonable   opinion  of  the
Administrative  Agent,  relating to such additional  Collateral Assets, and (ii)
Transfer Order Letters applicable to the production of oil and gas from the such
additional Collateral Assets.

                                  Article IV.

                         REPRESENTATIONS AND WARRANTIES

     To  induce  the  Administrative  Agent  and the  Banks to enter  into  this
Agreement and to make the Credit Extensions  hereunder,  Borrower represents and
warrants to the Administrative Agent and the Banks that:

     4.01 Existence. The Borrower is a Business Entity of the type specified for
such Borrower on the signature pages of this Agreement, duly organized,  legally
existing,  and in good  standing  under  the  Laws of the  State in which it was
organized; the Borrower has the lawful power to own its properties and to engage
in the businesses it conducts,  and it is duly qualified and in good standing as
a  foreign  Business  Entity  in the  jurisdictions  wherein  the  nature of the
business  transacted  by it or  property  owned by it makes  such  qualification
necessary;  the states in which the Borrower is  incorporated  or organized  and
qualified to do business are set forth in Schedule  4.01;  the  addresses of all
places of business of the Borrower are as set forth in Schedule  4.01;  Borrower
has not changed its name, been the surviving  company in a merger,  acquired any
business except the business of the Great Plains Pipeline System, or changed its
principal  executive  office to a location  outside the State of Oklahoma within
five (5) years and one (1) month prior to the date  hereof;  and Borrower has no
Subsidiaries.

     4.02 Due Authorization. Upon execution of the Loan Documents, the execution
and delivery by the Borrower of this  Agreement,  the Notes,  and the borrowings
hereunder;   the  execution  and  delivery  by  the  Borrower  of  the  Security
Instruments and the Transfer Order Letters; and the repayment by the Borrower of
the  Indebtedness  evidenced by the Notes and interest and fees  provided in the
Notes and this Agreement are (a) within the Corporate Power of the Borrower; (b)
have been duly authorized by all necessary  Corporate Action, and (c) do not and
will not (i) require the consent of any  regulatory  authority  or  governmental
body,  (ii) contravene or conflict with any provision of Law or of the Governing
Documentation of the Borrower,  (iii) contravene or conflict with any indenture,
instrument  or other  agreement to which the Borrower is a party or by which its
property may be presently bound or encumbered,  or (iv) result in or require the
creation or imposition of any mortgage, lien, pledge, security interest,  charge
or other  encumbrance  in,  upon or of any of the  properties  or  assets of the
Borrower under any such  indenture,  instrument or other  agreement,  other than
under any of the Security Instruments.

     4.03 Valid and Binding Obligations. This Agreement, the Notes, the Security
Instruments  (when  amended and restated to relate to the Loans  provided for in
this Agreement with regard to Borrower's CRI Security Instruments) and the other
Loan  Documents  when duly  executed  and  delivered,  will be legal,  valid and
binding obligations of and enforceable against the Borrower,  in accordance with
their  respective  terms  (subject to any applicable  bankruptcy,  insolvency or
other Laws of general application affecting creditors' rights, general equitable
principles, whether considered in a proceeding in equity or at law, and judicial
decisions interpreting any of the foregoing).

     4.04 Scope and Accuracy of Financial  Statements.  All Financial Statements
submitted and to be submitted to the Administrative Agent hereunder are and will
be complete and correct in all material respects,  Financial Statements that are
to be provided  after the date of this  Agreement will be prepared in accordance
with GAAP consistently  applied, and do and will fairly reflect the consolidated
financial  condition  and the results of the  operations  of the Borrower in all
material  respects as of the dates and for the period  stated  therein  (subject
only to normal year-end audit adjustments with respect to such unaudited interim
statements of the Borrower),  and no Material  Adverse Change has occurred since
the  effective  date of the latest  audited  Financial  Statements  of  Borrower
delivered to Administrative Agent.

     4.05 Title to Collateral  Assets.  The Borrower has Defensible Title to the
working  and net  revenue  interests  in the  Collateral  Assets as set forth on
Exhibit "A", free and clear of all mortgages, liens and encumbrances, except for
Permitted Encumbrances  (specifically  including,  but not limited to, the liens
created  by  Borrower's  CRI  Security  Instruments)  and any other  exceptions,
limitations or qualifications expressly disclosed on Exhibit "A."

     4.06  Oil and Gas  Leases.  The  Leases  which  constitute  any part of the
Collateral  Assets are in full force and effect as to those portions  within the
Collateral Assets, are valid,  subsisting leases as to those portions within the
Collateral  Assets to which they  pertain and all rentals,  royalties  and other
amounts due and payable in  accordance  with the terms of the Leases as to those
portions  within the Collateral  Assets,  overriding  royalties,  net profits or
other production burdens have been duly paid or provided for; the obligations to
be performed under the Leases as to those portions within the Collateral  Assets
have been duly  performed;  and the  Borrower is not aware of any default by any
third  party  under  any of the  Leases  with  respect  to  such  third  party's
obligations.

     4.07 Interest in the  Collateral  Assets.  Except as otherwise set forth on
Exhibit "A" hereto, with respect to each of the Collateral Assets, the ownership
of the Borrower in such property will,  with respect to the wells,  units and/or
tracts of land described in Exhibit "A" hereto in connection with such property,
(i) entitle the  Borrower,  to receive  (subject to the terms and  provisions of
this  Agreement) a decimal share of the oil and gas produced  from, or allocated
to, such wells, units and/or tracts equal to not less than the decimal share set
forth in Exhibit "A" in connection  with such wells,  units and/or  tracts,  and
(ii) cause the Borrower to be  obligated to bear a decimal  share of the cost of
exploration,  development  and  operation of such wells,  units and/or tracts of
land not greater than the decimal  share set forth in Exhibit "A" in  connection
with such wells,  units and/or  tracts,  unless any  increase in the  Borrower's
share of costs is accompanied by a pro-rata  increase in the Borrower's share of
revenue.  Except as set forth in the  instrument  and  agreements,  if any, more
particularly  described  in Exhibit  "A" hereto,  all such shares of  production
which the  Borrower is entitled  to  receive,  and shares of expenses  which the
Borrower is  obligated  to bear,  are not subject to change,  except for changes
attributable  to  future  elections  by  the  Borrower  not  to  participate  in
operations  proposed  pursuant to customary forms of applicable  joint operating
agreements,  and except for  changes  attributable  to changes in  participating
areas  under any  federal  units  wherein  participating  areas  may be  formed,
enlarged or  contracted  in  accordance  with the rules and  regulations  of the
applicable governmental authority.

     4.08 Oil and Gas  Contracts.  Except as set forth on Schedule 4.08 attached
hereto,  Borrower  is not  obligated,  by  virtue  of any  prepayment  under any
contract providing for the sale by the Borrower of Hydrocarbons which contains a
"take-or-pay"  clause or under any similar prepayment  agreement or arrangement,
including, without limitation, "gas balancing agreements", to deliver a material
amount of Hydrocarbons  produced from the Collateral  Assets at some future time
without then or thereafter receiving full payment therefor (i.e., in the case of
oil, not in excess of sixty (60) days,  and in the case of gas, not in excess of
ninety (90) days).  Except as set forth on Schedule  4.08 attached  hereto,  the
Collateral  Assets are not subject to any contractual,  or other arrangement for
the sale of crude oil which  cannot be  canceled  on ninety (90) days' (or less)
notice,  unless the price  provided  for therein is equal to or greater than the
prevailing  market price in the vicinity.  The Collateral Assets are not subject
to any gas  sales  contract  that  contains  any  material  terms  which are not
customary  in the  industry  within  the region in which the  Collateral  Assets
affected  thereby  are  located.  The  Collateral  Assets are not subject to any
regulatory refund obligation and no facts exist which might cause the same to be
imposed.

     4.09 Producing Wells. All producing wells located on the Collateral  Assets
have been, during all times that such were under the direction or control of the
Borrower  and, to the knowledge of the  Borrower,  at all other times,  drilled,
operated and produced in conformity with all applicable Laws, rules, regulations
and orders of all regulatory authorities having jurisdiction,  are subject to no
penalties  on  account  of past  production,  and  are  bottomed  under  and are
producing from, and the well bores are wholly within,  the Collateral Assets, or
on Oil and Gas Properties which have been pooled,  unitized or communitized with
the Collateral Assets.

     4.10  Purchasers  of  Production.   The  persons  who  are  purchasing  the
Borrower's  interests in oil and gas produced from the  Collateral  Assets as of
the  calendar  month  during  which the  initial  Loans are made  hereunder  are
identified on Schedule 4.10 attached hereto.

     4.11  Authorizations  and Consents.  Except as required in conjunction with
the CRI Credit  Agreement and satisfied  pursuant to Section 3.02(K) hereof,  no
authorization, consent, approval, exemption, franchise, permit or license of, or
filing with, any governmental or public authority or any third party is required
to authorize,  or is otherwise  required in connection  with the valid execution
and  delivery by the  Borrower of this  Agreement,  the Notes,  and the Security
Instruments, or any other instrument contemplated hereby to which such Person is
a party,  the  repayment  by the  Borrower  of  advances  against  the Notes and
interest and fees provided in the Notes and this  Agreement,  or the performance
by the Borrower of its obligations under any of the foregoing.

     4.12  Environmental  Laws.  Except to the extent  that the failure to do so
would not have and would not be expected to have a Material Adverse Effect,  the
Borrower (a) is and has in the past been in  compliance  with all  Environmental
Laws and all permits,  requests and notifications  relating to health, safety or
the  environment  applicable to the Borrower or any of its  properties,  assets,
operations  and  businesses;  (b) has  obtained  and  adhered  to and  currently
possesses all necessary  permits and other approvals,  including  interim status
under the Federal Resource  Conservation  and Recovery Act,  necessary to store,
dispose  of  and  otherwise  handle  Hazardous  Substances  and to  operate  its
properties,  assets and businesses;  (c) has reported, to the extent required by
all federal,  state and local statutes,  Laws, ordinances,  regulations,  rules,
permits,  judgments, orders and decrees, all past and present sites owned and/or
operated  by the  Borrower  where any  Hazardous  Substance  has been  released,
treated,  stored or disposed of and (d) has not used,  stored,  or Released  any
Hazardous  Substance in excess of amounts allowed by Environmental Law. There is
(x) no location on any property currently or previously owned or operated by the
Borrower where  Hazardous  Substances are known to have entered or are likely to
enter into the soil or  groundwater  or such  property,  other  than  immaterial
releases of oil or natural gas in the ordinary  course of business none of which
releases  (i)  either  individually,  or in  the  aggregate,  has  had or may be
expected  to have a  Material  Adverse  Effect  or (ii) has  violated  or may be
expected to violate any  Environmental  Laws, except for any such violation that
has not had and would not be expected to have a Material Adverse Effect, and (y)
no  on-site  or  off-site  location  to  which  the  Borrower  has  released  or
transported  Hazardous Substances or arranged for the transportation or disposal
of Hazardous Substances, which is or is likely to be the subject of any federal,
state, local or foreign enforcement action or any investigation which could lead
to any material  claims against any such entity for any clean-up cost,  remedial
work, damage to natural resources, common law or legal liability, including, but
not limited to, claims under Comprehensive Environmental Response, Compensation,
and  Liability  Act.  For the  purposes  of  this  Section,  references  to "the
Borrower"  shall  include  all  predecessors,   successors-in-interest   of  the
Borrower.

     4.13 Compliance  with Laws,  Rules,  Regulations and Orders.  Except to the
extent  that the  failure  to comply  would not  materially  interfere  with the
conduct  of the  business  of the  Borrower,  Borrower  has  complied  with  all
applicable  Laws with respect to: (1) the conduct of its  business;  and (2) the
use, maintenance, and operation of the Collateral Assets and personal properties
owned or leased by it in the conduct of its  business;  except as expressly  set
forth on  Exhibit  "A"  hereto,  Borrower  possesses  all  licenses,  approvals,
registrations,  permits and other authorizations necessary to enable it to carry
on its  business  in all  material  respects  as now  conducted,  and  all  such
licenses, approvals, registrations, permits and other authorizations are in full
force and effect;  and Borrower has no reason to believe that the Borrower  will
be unable to obtain the renewal of any such licenses, approvals,  registrations,
permits and other authorizations.

     4.14 Liabilities,  Litigation and Restrictions.  Except as disclosed in the
Financial  Statements,  Borrower  does  not  have  any  liabilities,  direct  or
contingent,  which may  materially  and  adversely  affect it, its  business  or
assets.  There is no litigation or other action of any nature pending before any
court, governmental  instrumentality,  regulatory authority or arbitral body or,
to the knowledge of the Borrower  threatened against or affecting Borrower which
might  reasonably be expected to result in any material,  adverse  change in the
Borrower, or its business or assets. To the best of the Borrower's knowledge, no
unduly  burdensome  restriction,  restraint or hazard  exists by contract or Law
that would have a Material Adverse Effect.

     4.15 Existing  Indebtedness.  All  Indebtedness  of Borrower  consisting of
liability  to repay  borrowed  money or to pay  money to become  due on  capital
leases as of the Closing is described in Schedule  4.15;  and Borrower is not in
default with respect to any of its existing Indebtedness.

     4.16 Material  Contracts.  All of  Borrower's  material  contracts,  leases
(other than oil and gas leases), or commitments of any kind (including,  without
limitation, gas gathering, processing, compression, treatment, storage, exchange
and  handling  agreements  of any type;  employment  agreements  with  executive
officers;  collective bargaining  agreements;  powers of attorney;  distribution
arrangements;  patent  license  agreements;  contracts  for future  purchase  or
delivery  of goods or  rendering  of  services,  including,  but not limited to,
contracts  with  producers for the purchase of natural gas from whom  production
purchases  by Borrower  represents  10% or more of all  production  purchases by
Borrower;  bonuses,  pension and  retirement  plans;  or accrued  vacation  pay,
insurance  and  welfare  agreements),  all  of  which  are  collectively  called
"Material Contracts," are described on Schedule 4.16 attached hereto; (b) to the
best of Borrower's  knowledge,  all parties to all such Material  Contracts have
complied  with the  provisions  thereof;  and (c) to the best of the  Borrower's
knowledge,  no party is in default  under any thereof and no event has  occurred
that but for the  giving  of  notice  or the  passage  of time,  or both,  would
constitute a default, except for defaults and events that have not had and would
not be expected to have a Material Adverse Effect.

     4.17 Margin Stock.  The Borrower is not engaged  principally,  or as one of
its important activities, in the business of extending credit for the purpose of
purchasing or carrying  margin stock (within the meaning of Regulations T, U, or
X of the Board of Governors of the Federal Reserve  System),  and no part of the
proceeds  of any  extension  of  credit  under  this  Agreement  will be used to
purchase  or carry any such margin  stock or to extend  credit to others for the
purpose of  purchasing or carrying  margin  stock.  Neither the Borrower nor any
Person  acting  on its  behalf  has  taken  any  action  that  might  cause  the
transactions  contemplated by this Agreement or the Notes to violate Regulations
T, U, or X or to violate the Securities Exchange Act of 1934, as amended.

     4.18  Proper  Filing of Tax  Returns  and  Payment of Taxes Due.  Except as
otherwise  permitted herein,  the Borrower,  as a member of the CRI consolidated
group, has to Borrower's best knowledge filed all federal,  state, and local tax
returns and other  reports  required by any  applicable  Laws to have been filed
prior to the date hereof, has paid or caused to be paid all taxes,  assessments,
and  other  governmental  charges  that  are due and  payable  prior to the date
hereof,  and has  made  adequate  provision  for  the  payment  of  such  taxes,
assessments, or other charges accruing but not yet payable; the CRI consolidated
group has elected to be taxed as a sub-chapter "S" corporation; and the Borrower
has  no  knowledge  of any  material  deficiency  or  additional  assessment  in
connection  with any taxes,  assessments,  or charges  not  provided  for on its
books.

     4.19 ERISA. The Borrower is in compliance in all material respects with all
applicable  provisions  of ERISA.  Neither a  Reportable  Event nor a Prohibited
Transaction  has occurred and is continuing  with respect to any plan; no notice
of intent to terminate a plan has been filed,  nor has any plan been terminated;
no  circumstances  exist which  constitute  grounds  under Section 4042 of ERISA
entitling the PBGC to institute  proceedings to terminate,  or appoint a trustee
to  administrate  a plan,  nor has the PBGC  instituted  any  such  proceedings;
neither  the  Borrower  nor any ERISA  Affiliate  has  completely  or  partially
withdrawn under Sections 4201 or 4204 of ERISA from a  Multi-Employer  Plan; the
Borrower and each ERISA Affiliate has met its minimum funding requirements under
ERISA  with  respect  to all of its plans and the  present  value of all  vested
benefits  under each plan is less than the fair market  value of all plan assets
allocable to such benefits,  as determined on the most recent  valuation date of
the plan and in  accordance  with the  provisions  of ERISA and the  regulations
thereunder for calculating the potential  liability of the Borrower or any ERISA
Affiliate  to the PBGC or the plan  under  Title IV of ERISA;  and  neither  the
Borrower nor any ERISA  Affiliate  has incurred any  liability to the PBGC under
ERISA.

     4.20  Investment  Company  Act  Compliance.  Borrower  is not  directly  or
indirectly  controlled  by,  or acting on behalf  of,  any,  Person  which is an
"Investment  Company," within the meaning of the Investment Company Act of 1940,
as amended.

     4.21  Public  Utility  Holding  Company Act  Compliance.  Borrower is not a
"holding company",  or an "affiliate" of a "holding company" or of a "subsidiary
company"  of a  "holding  company",  within the  meaning  of the Public  Utility
Holding Company Act of 1935, as amended.

     4.22 Insurance. Borrower maintains insurance with respect to the properties
and  business  of  the  Borrower   providing   coverage  for  such  liabilities,
casualties,  risks and  contingencies and in such amounts as is customary in the
industry.  The  insurance  coverage  reflected on the  Certificate  of Insurance
attached  hereto as Schedule 4.22 is in full force and effect,  and all premiums
due thereon have been paid or provided for.

     4.23  Borrower's  Shareholders  and  Directors.  Each  "person"  or "group"
(within the meaning of Section 13(d) or 14(d) of the Securities  Exchange Act of
1934,  as amended)  that is  directly or  indirectly  a  "beneficial  owner" (as
defined in Section  13d-3 and 13d-5 of the  Securities  Exchange Act of 1934, as
amended) of shares of the  outstanding  capital  stock of Borrower  representing
five percent (5%) or more of the outstanding capital stock of Borrower as of the
date of this  Agreement is listed on Schedule  4.23  attached  hereto,  and each
member of  Borrower's  board of  directors  as of the date of this  Agreement is
listed on Schedule 4.23.

     4.24 Material Misstatements and Omissions. No representation or warranty by
or with  respect to Borrower  contained  herein or in any  certificate  or other
document furnished by the Borrower pursuant hereto contains any untrue statement
of a material  fact or omits to state a  material  fact  necessary  to make such
representation  or warranty not misleading in light of the  circumstances  under
which it was made.

                                   Article V.

                              AFFIRMATIVE COVENANTS

     Borrower  covenants so long as any Indebtedness of the Borrower to any Bank
or the LC Issuer remains unpaid under this Agreement,  or any Obligations of the
Borrower to any Bank Parties remain  unsatisfied,  or any Bank remains obligated
to make  advances  hereunder or the LC Issuer is obligated to issue any Facility
LC hereunder, to;

     5.01 Use of Funds. Use Loan proceeds advanced  hereunder in connection with
the Term Loan solely for purposes of a one-time cash  distribution to CRI, to be
used by CRI  for  payment  of  Indebtedness  outstanding  under  the CRI  Credit
Agreement;  and use Loan proceeds  advanced  under the Revolving Loan to connect
future  wells to  Borrower's  gas  pipeline and  gathering  systems,  to acquire
additional  Pipeline  Properties  and Oil and Gas  Properties,  and for  funding
Borrower's general working capital needs.

     5.02 Maintenance and Access to Records. Keep adequate records in accordance
with good accounting  practices,  of all of the  transactions of the Borrower so
that at any  time,  and from  time to time,  such  records  present  fairly  the
financial  condition of the Borrower which may be readily determined and, at the
Administrative  Agent's  reasonable  request,  make all  financial  records  and
records  relating to the  Collateral  Assets  available  for the  Administrative
Agent's  inspection  and permit the  Administrative  Agent to make and take away
copies thereof.

     5.03   Quarterly   Unaudited   Financial   Statements.   Deliver   to   the
Administrative  Agent, on or before the forty-fifth  (45th) day after the end of
each  calendar  quarter,  unaudited  consolidated  Financial  Statements  of the
Borrower,  as at the end of such  period and from the  beginning  of such fiscal
year  to the  end of the  respective  period,  as  applicable,  which  Financial
Statements shall be certified by the president or chief financial officer of the
Borrower, as being true and correct,  subject to changes resulting from year-end
audit adjustments.

     5.04 Annual Audited  Financial  Statements.  Deliver to the  Administrative
Agent,  on or before the one  hundred  twentieth  (120th) day after the close of
each fiscal year of the Borrower a copy of annual audited consolidated Financial
Statements  of the  Borrower,  together  with the report and opinion  thereon of
independent certified public accountants  acceptable to the Administrative Agent
at its reasonable discretion.

     5.05 Compliance Certificate.  At Closing and at the time of delivery of the
certified but unaudited Financial Statements pursuant to Section 5.03 above, and
the delivery of the annual audited Financial Statements pursuant to Section 5.04
above, deliver to the Administrative Agent a Compliance Certificate.

     5.06 Statement of Material  Adverse Change.  Deliver to the  Administrative
Agent,  promptly upon any officer of Borrower  having  knowledge of any Material
Adverse  Change  (or any event or  circumstance  that  would  result in any such
Material Adverse Change), a statement of the President, Chief Financial Officer,
or the Treasurer of the Borrower, setting forth the change in condition or event
or circumstance likely to result in any such change and the steps being taken by
the Borrower with respect to such change in condition or event or circumstance.

     5.07 Title Defects.  Cure any title defects to the Collateral  Assets which
cause the title to the  Collateral  Assets not to be Marketable  and which title
defects cause material reduction in value of the Collateral  Assets,  considered
as a whole, in the reasonable opinion of the  Administrative  Agent, and, in the
event any such title defects are not cured in a timely  manner,  pay all related
costs and fees incurred by the Administrative Agent for the account of the Banks
to do so.

     5.08 Additional Information.  Furnish to the Administrative Agent copies of
all  information,  if any,  filed with the  Securities  Exchange  Commission  in
written or electronic form by the Borrower. Furnish to the Administrative Agent,
promptly upon the  Administrative  Agent's reasonable  request,  such additional
financial or other information concerning the assets,  liabilities,  operations,
and transactions of the Borrower,  including,  without  limitation,  information
concerning title to any of the Collateral Assets.

     5.09 Compliance  with Laws and Payment of Assessments  and Charges.  Comply
with all applicable  statutes and  government  regulations,  including,  without
limitation, ERISA, and pay all taxes, assessments,  governmental charges, claims
for labor, supplies, rent and other obligations which, if unpaid, might become a
lien other than a Permitted Encumbrance against its property,  except any of the
foregoing being contested in good faith and as to which accruals satisfactory to
the Administrative Agent, in its reasonable discretion, have been provided.

     5.10  Maintenance of Existence and Good  Standing.  Maintain the Borrower's
corporate  existence and good standing in the jurisdiction of its  organization,
and  maintain  the  Borrower's  qualification  and good  standing  in all  other
jurisdictions  wherein the property now owned or hereafter  acquired or business
now or  hereafter  conducted  by Borrower  necessitates  same,  other than those
jurisdictions wherein the failure to so qualify will not have a Material Adverse
Effect on the Borrower.

     5.11 Further  Assurances.  Promptly  cure any defects in the  execution and
delivery of this Agreement,  the Notes, the Security  Instruments,  the Transfer
Order  Letters,  or any other  instrument  referred  to herein  or  executed  in
connection with the Notes, and upon the reasonable request of the Administrative
Agent promptly  execute and deliver to the  Administrative  Agent all such other
and  further  instruments  as may  be  reasonably  required  or  desired  by the
Administrative  Agent from time to time in  compliance  with the  covenants  and
agreements made in this Agreement.

     5.12  Initial  Expenses  of  the  Bank.  Pay  prior  to or at  Closing  all
documented reasonable fees and expenses of Porter & Hedges,  L.L.P., the special
legal  counsel for the  Administrative  Agent  incurred  directly  and solely in
connection  with the  preparation  of this  Agreement,  the Notes,  the Security
Instruments,  the Transfer Order Letters,  and any other instrument  referred to
herein or  executed  directly  and  solely in  connection  with the  Notes,  the
satisfaction  of the  conditions  precedent  set  forth in  Article  III of this
Agreement  and  the  consummation  of  the  transactions  contemplated  in  this
Agreement.

     5.13  Subsequent  Expenses  of the Bank  Parties.  Upon  request,  promptly
reimburse  any  Bank  Party  for all  documented  amounts  reasonably  expended,
advanced or incurred  by such Bank Party to collect the Notes,  restructure  the
Notes or to  enforce  the rights of such Bank Party  under this  Agreement,  the
Notes,  the Security  Instruments,  the  Transfer  Order  Letters,  or any other
instrument  referred to herein or executed in connection  with the Notes,  which
amounts shall be deemed  compensatory in nature and liquidated as to amount upon
notice to the  Borrower  by the  Administrative  Agent and  which  amounts  will
include,  but not be limited to, (a) all court costs, (b) reasonable  attorneys'
fees, (c) fees of auditors and accountants, (d) investigation expenses, (e) fees
and expenses  incurred in connection  with any Bank Party's  participation  as a
member of the  creditors  committee  in a case  commenced  under Title 11 of the
United States Code or other similar Law of the United States, the State of Texas
or any other  jurisdiction,  (f) fees and expenses  incurred in connection  with
lifting the automatic stay prescribed in ss.ss.362 Title 11 of the United States
Code, and (g) fees and expenses  incurred in connection with any action pursuant
to  ss.ss.1129  Title 11 of the United States Code,  reasonably  incurred by any
Bank  Party in  connection  with the  collection  of any  sums  due  under  this
Agreement,  together with interest at the Floating Rate per annum, calculated on
a basis of a year of three hundred sixty (360) days on each such amount from the
date of  notification  to the Borrower that the same was  expended,  advanced or
incurred by any Bank Party until,  but not  including,  the date it is repaid to
such Bank Party,  with the  obligations  under this Section 5.13,  surviving the
non-assumption  of this  Agreement  in a case  commenced  under  Title 11 of the
United States Code or other similar Law of the United States, the State of Texas
or any other  jurisdiction  and being  binding  upon the  Borrower or a trustee,
receiver or liquidator of any such party appointed in any such case.

     5.14  Maintenance  of  Tangible  Property.  Maintain  all of  its  tangible
property relating to the Collateral Assets in good repair and condition and make
all  necessary  replacements  thereof  and operate  such  property in a good and
workmanlike  manner in accordance with standard industry  practices,  unless the
failure to do so would not have a Material Adverse Effect on the Borrower or the
value of any Collateral Asset.

     5.15  Maintenance  of  Insurance.  Continue  to  maintain,  or  cause to be
maintained,  insurance  with  respect  to the  properties  and  business  of the
Borrower against such  liabilities,  casualties,  risks and contingencies and in
such amounts as is  customary in the industry and furnish to the  Administrative
Agent  annually after the execution of this  Agreement  certificates  evidencing
such insurance.

     5.16 Inspection of Tangible  Assets/Right  of Audit.  Permit any authorized
representative of the Administrative  Agent to visit and inspect (at the risk of
the Administrative  Agent and/or such  representative) any tangible asset of the
Borrower,  and/or to audit the books and records of the Borrower  during  normal
business hours, at the expense of the Administrative  Agent following reasonable
advance notice.

     5.17  Payment  of Note  and  Performance  of  Obligations.  Pay  the  Notes
according to the reading,  tenor and effect thereof,  as modified hereby, and do
and  perform  every act and  discharge  all of the  Obligations  provided  to be
performed and discharged hereunder.

     5.18  Availability  Amount.  Maintain a  Availability  Amount such that the
amount of the  Outstanding  Credit  Exposure  will not,  at any time  other than
during applicable grace periods expressly set forth elsewhere in this Agreement,
exceed the Aggregate Commitment Amount.

     5.19 Compliance with Environmental Laws. To the extent necessary to avoid a
Material Adverse Effect, comply with any and all requirements of Law, including,
without  limitation,  Environmental  Laws,  (a)  applicable  to any  natural  or
environmental  resource or media located on, above,  within, in the vicinity of,
related to or affected  by any  Collateral  Assets or any other  property of the
Borrower,  or (b) applicable to the  performance  or conduct of its  operations,
including, without limitation, all permits, licenses,  registrations,  approvals
and authorizations, and, in this regard, comply with, and require all employees,
crew members,  agents,  contractors and subcontractors  (pursuant to appropriate
contractual  provisions)  and future  lessees  (pursuant  to  appropriate  lease
provisions)  of the Borrower  while such Persons are acting  within the scope of
their  relationship  with  the  Borrower,  to so  comply  with,  all  applicable
requirements of Law,  including,  without limitation,  applicable  Environmental
Laws,  and other  applicable  requirements  with  respect to the property of the
Borrower,  and the  operation  thereof  necessary or  appropriate  to enable the
Borrower to fulfill its  obligations  under all applicable  requirements of Law,
including,  without  limitation,  Environmental  Laws,  applicable  to the  use,
generation,   handling,  storage,  treatment,  transport  and  disposal  of  any
Hazardous  Substances  now or hereafter  located or present on or under any such
property.

     5.20 Hazardous Substances  Indemnification.  Indemnify and hold each of the
Bank  Parties  harmless  from and against any and all claims,  losses,  damages,
liabilities,  fines, penalties, charges, administrative and judicial proceedings
and orders, judgments, remedial actions, requirements and enforcement actions of
any  kind,  and  all  costs  and  expenses  incurred  in  connection   therewith
(including, without limitation,  attorneys' fees and expenses), arising directly
or  indirectly,  in whole or in part,  out of (a) the presence of any  Hazardous
Substances  on, under or from its property,  whether prior to or during the term
hereof,  or (b) any activity  carried on or  undertaken  on or off its property,
whether prior to or during the term hereof, and whether by the Borrower,  or any
predecessor in title or any employees,  agents, contractors or subcontractors of
the  Borrower,  or any  predecessor  in title,  or any third Persons at any time
occupying  or  present  on such  property,  in  connection  with  the  handling,
treatment,  removal,  storage,   decontamination,   cleanup,  transportation  or
disposal of any Hazardous  Substances at any time located or present on or under
such property;  with the foregoing  indemnity  further  applying to any residual
contamination  on or under the property of the Borrower,  or any property of any
other Person,  or affecting any natural  resources,  and to any contamination of
any property or natural  resources  arising in connection  with the  generation,
use, handling, storage,  transportation or disposal of any Hazardous Substances,
irrespective  of whether any of such  activities  were or will be  undertaken in
accordance with applicable  requirements of Law, including,  without limitation,
Environmental  Laws,  and  surviving  satisfaction  of all  Indebtedness  of the
Borrower  to any of the Bank  Parties  and the  termination  of this  Agreement,
unless all such Indebtedness has been satisfied wholly in cash from the Borrower
and not by way of  realization  against any  property or the  conveyance  of any
property of the  Borrower in lieu  thereof,  provided  that the claims and other
actions  of any kind  against  any of the Bank  Parties  which give rise to such
indemnity are not barred by the  applicable  statute of  limitations at the time
such claims or actions are instituted and such indemnity shall not extend to any
act or omission by any of the Bank Parties with respect to the relevant property
subsequent to the  Administrative  Agent,  the Arranger or any Bank becoming the
owner of,  taking  possession  of to the  exclusion  of the Borrower or assuming
operations of any property  previously owned by the Borrower and with respect to
which property such claim,  loss,  damage,  liability,  fine,  penalty,  charge,
proceeding,  order,  judgment,  action or requirement  arises  subsequent to the
acquisition  of title  thereto,  taking  possession  thereof  or  assumption  of
operations thereon by any of the Bank Parties.

     5.21  Transactions  with  Affiliates.  Conduct  all  transactions  with any
Affiliate  of  the  Borrower  on  an  arm's-length  basis  (provided  that  such
transactions   are  otherwise   permitted  by  the  terms  of  this  Agreement),
specifically  including,  but not limited to, all  Material  Contracts  with any
Affiliate.

     5.22 Leases.  Keep and continue all Leases comprising the Collateral Assets
and related  contracts and agreements  relating thereto in full force and effect
in  accordance  with  the  terms  thereof  and not  permit  the same to lapse or
otherwise  become impaired for failure to comply with the  obligations  thereof,
whether  express or implied;  provided,  however,  that this provision shall not
prevent the Borrower  from  abandoning  and releasing any such Leases upon their
termination as the result of cessation of production in paying  quantities  that
did not result from the  Borrower's  failure to maintain  such  production  as a
reasonably prudent operator.

     5.23 Operation of Collateral Assets.  Operate the Collateral Assets and all
wells drilled  thereon and that may hereafter be drilled  thereon,  continuously
and in a good and  workmanlike  manner  and in  accordance  with all Laws of the
State in which the  Collateral  Assets are  situated  and the  United  States of
America, as well as all rules, regulations,  and Laws of any governmental agency
having  jurisdiction  to  regulate  the  manner  in which the  operation  of the
Collateral  Assets shall be carried on, and comply with all terms and conditions
of the  Leases it now holds,  and any  assignment  or  contract  obligating  the
Borrower in any way with respect to the  Collateral  Assets;  but nothing herein
shall be  construed  to  empower  the  Borrower  to bind  any Bank  Party to any
contract  obligation,  or render any Bank Party in any way responsible or liable
for bills or obligations incurred by the Borrower.

     5.24 Assignments.  Upon request of the  Administrative  Agent,  execute and
deliver  written  notices of assignments to any persons,  corporations  or other
entities owing or which may in the future owe to the Borrower monies or accounts
arising in  connection  with any of the following  matters:  (a) any oil, gas or
mineral production from the Collateral Assets; (b) any gas contracts, processing
contracts  or other  contracts  relating to the  Collateral  Assets;  or (c) the
operation of or production from any part of the Collateral Assets.

     5.25 Change of Purchasers of Production.  On or before each  anniversary of
the Closing,  and at any other time that the Administrative Agent may so request
in writing, the Borrower shall notify the Administrative Agent in writing of the
identity  and address of each  then-current  purchaser  of  production  from the
Collateral Assets and, if requested by the  Administrative  Agent, shall provide
the  Administrative  Agent with Transfer Order Letters  executed by the Borrower
and addressed to such purchasers of production.

     5.26  Payment of Taxes,  Etc.  Pay or cause to be paid when due, all taxes,
assessments,   and  charges  or  levies  imposed  upon  it  and/or  any  of  its
Subsidiaries,  or on any of their respective  property,  or which it or they are
required  to  withhold  and  pay,  except  where  contested  in  good  faith  by
appropriate proceedings with adequate reserves therefor having been set aside on
its books,  provided,  however,  that the Borrower shall each pay or cause to be
paid  all  such  taxes,  assessments,  charges,  or  levies  forthwith  whenever
foreclosure  on any lien that may have attached (or security  therefor)  appears
imminent.

     5.27 Notice of  Litigation.  Give  immediate  notice to the  Administrative
Agent  of:  (1)  any  litigation  or  proceeding  in  which  it or  any  of  its
Subsidiaries is a party if an adverse  decision  therein would require it or any
of its Subsidiaries to pay more than Five Hundred Thousand Dollars ($500,000.00)
in the aggregate or deliver  assets the value of which exceeds such sum (whether
or not  the  claim  is  considered  to be  covered  by  insurance);  and (2) the
institution  of any other suit or  proceeding  involving the Borrower that might
materially and adversely affect its operations,  financial condition,  property,
or business prospects.

     5.28  Notice  of  Events  of  Default.   Notify  the  Administrative  Agent
immediately  if it becomes aware of the occurrence of any Event of Default or of
any fact, condition,  or event that only with the giving of notice or passage of
time or both,  would  become an Event of Default  or if it becomes  aware of any
Material  Adverse  Change  (including,   without   limitation,   proceedings  in
bankruptcy,  insolvency,  reorganization,  or the  appointment  of a receiver or
trustee),  or of the failure of the Borrower to observe any of its  undertakings
hereunder or under the Security Instruments.

     5.29 Notice of Change of Principal Offices. Notify the Administrative Agent
thirty  (30) days in  advance  of any change in the  location  of the  principal
offices of Borrower or any of its Subsidiaries.

     5.30 Employee  Benefit Plans.  Fund its Plan(s) in accordance  with no less
than the minimum  funding  standards  of 29 U.S.C.A.  ss. 1082  (Section  302 of
ERISA); furnish the Administrative Agent, promptly after the filing or receiving
of the same,  with copies of any  reports or other  statements  filed  with,  or
notices or other  communications  received from, the United States Department of
Labor,  the PBGC, or the Internal Revenue Service with respect to any such Plan;
promptly  advise the  Administrative  Agent of the  occurrence of any Reportable
Event or Prohibited Transaction with respect to any such Plan and the action the
Borrower  proposes  to take  with  respect  thereto;  and  promptly  advise  the
Administrative  Agent when the Borrower  knows or has reason to believe that the
PBGC or the Borrower has instituted or will institute proceedings under Title IV
of ERISA to terminate any such Plan and the action the Borrower proposes to take
with respect thereto.

     5.31 Annual Capital Budget. Within thirty (30) days after Closing, Borrower
shall prepare and submit to Administrative  Agent monthly financial  projections
and planned capital  expenditures (the "Budget") applicable to the activities of
Borrower to be conducted:  (a) through the fiscal quarter ending March 31, 2004,
with  respect  to all  activities  of  Borrower,  such  Budget to be in form and
substance  reasonably  satisfactory to Administrative  Agent, and which shall be
sufficient to demonstrate to the Required Banks'  reasonable  satisfaction  that
Borrower  will  remain in  compliance  with this  Agreement  and the other  Loan
Documents during the period covered by the Budget. Thereafter, an updated Budget
shall be submitted  to  Administrative  Agent within  ninety (90) days after the
close of each fiscal year so that the Budget  always  covers the period  through
the projected completion of all planned capital expenditures through the ensuing
four (4) calendar  quarters  with respect to all  activities  of Borrower.  Each
updated  Budget  submitted to the  Administrative  Agent within ninety (90) days
after  the  close of each  fiscal  year  shall  also  include  a  comparison  of
Borrower's  actual  capital  expenditures  during  such  preceding  fiscal  year
compared to the  expenditures  forecast  for such fiscal year on the most recent
Budget that had been  submitted to  Administrative  Agent with respect  thereto.
Borrower shall conduct the activities  contemplated by the capital  expenditures
forecast in each current Budget,  substantially as and when contemplated in such
Budget.

     5.32 Payment of Obligations.  Promptly pay (or renew and extend) all of its
Indebtedness  as it becomes due,  unless  payment of such  Indebtedness  is: (a)
restricted  pursuant to Article VI hereof,  or (b) being contested in good faith
by appropriate proceedings.

     5.33 Compliance with Section 2.06. Comply with Section 2.06, including, but
not limited to, the delivery of the Engineering Reports, as specified therein.

     5.34 Notice  Regarding  Early  Termination  of Hedge  Agreements.  Promptly
notify Administrative Agent regarding the occurrence of any early termination or
other unwind of any Hedge  Agreement  prior to the end of its original,  nominal
term,  such  notification  to be given by Borrower as promptly as possible after
Borrower  learns  of the  occurrence  or  impending  occurrence  of  such  early
termination, and in any event not later than two Business Days thereafter.

     5.35 Accounts Receivable Aging Reports.  Within fourteen (14) days from the
end of each calendar month, submit to Administrative  Agent a report in form and
substance  acceptable  to the  Administrative  Agent  identifying  the  accounts
receivable  aging for all accounts  receivable of Borrower as of the end of such
calendar month.

     5.36 Accruals for Personal Tax Distributions.

          (a) While  Borrower is a Subsidiary of CRI. For so long as Borrower is
     a wholly-owned  Subsidiary  of CRI,  Borrower  shall prepare a hypothetical
     separate  tax return on the  assumptions  that (a)  Borrower  is a separate
     taxpaying  corporation  and (b)  Borrower has not elected to be taxed as an
     "S" corporation. Borrower may establish and maintain a cash reserve account
     for Personal Tax Distributions  (the "Tax Accrual  Account"),  and shall be
     permitted  to make  quarterly  deposits  into that  account  equal to a sum
     determined  by  multiplying  Borrower's  estimated  taxable  income for the
     quarter (x) by a percentage equal to 34% during each tax year through 2005,
     and (y) after  December  31,  2005,  by a  percentage  equal to the highest
     combined  federal and state  income tax rate  applicable  to an  individual
     taxpayer (the "Annual Tax Rate"). Borrower shall have the right to disburse
     from such account quarterly, to CRI for the benefit of its shareholders, an
     amount equal to the estimated  federal income tax liability payable by such
     shareholders  with  respect to such  quarter  that is  attributable  to the
     taxable income of the CRI consolidated group for such quarter multiplied by
     a fraction,  the  numerator of which is the  Borrower's  estimated  taxable
     income for such quarter and the  denominator  of which is of the  estimated
     taxable income of the CRI consolidated group for such quarter  ("Borrower's
     Percentage Share").  After the end of each tax year, but on or before April
     15 of the following year,  when the taxable income of the CRI  consolidated
     group is  determined,  Borrower  shall have the right to disburse from such
     account and from other funds  available to Borrower,  if necessary,  to the
     shareholders  of CRI an amount equal to a sum determined by multiplying the
     Annual Tax Rate times  Borrower's  Percentage  Share of CRI's  consolidated
     group taxable income,  less the sum of all amounts  previously  distributed
     from the Tax  Accrual  Account to CRI for the  benefit of its  shareholders
     with respect to such tax year.

          (b) When Borrower is No Longer a Subsidiary of CRI. From and after the
     time that Borrower is no longer a  wholly-owned  Subsidiary of CRI, and for
     so long as Borrower is an "S"  corporation for federal income tax purposes,
     Borrower may continue to  establish  and maintain the Tax Accrual  Account,
     and shall be permitted to make  quarterly  deposits into that account equal
     to Borrower's  estimated  taxable income for the quarter  multiplied by the
     Annual Tax Rate.  Borrower  shall have the right to  disburse  from the Tax
     Accrual  Account  quarterly to its own  shareholders an amount equal to the
     estimated  federal income tax liability  payable by such  shareholders with
     respect to such  quarter  that is  attributable  to the  taxable  income of
     Borrower for such quarter. After the end of each tax year, but on or before
     April 15 of the following  year, when the taxable income of the Borrower is
     determined,  Borrower  shall have the right to disburse  from such  account
     (and  from  other  funds  available  to  Borrower,  if  necessary)  to  its
     shareholders  an amount equal to a sum determined by multiplying the Annual
     Tax Rate times Borrower's taxable income for such tax year, less the sum of
     all amounts  previously  distributed  form the Tax Accrual  Account to such
     shareholders with respect to such tax year.

          (c) Application of Excess  Accruals.  If after applying the provisions
     of Sections 5.36(a) or (b), as applicable, with respect to a full tax year,
     there  remains any sum in the Tax Accrual  Account  that  Borrower  was not
     permitted by Section  5.36(a) or (b), as  applicable,  to distribute to the
     shareholders of CRI or Borrower,  respectively,  then on or before April 15
     following the end of such tax year, CRI shall pay 75% of such undistributed
     amount to the Banks as a supplemental payment out of Excess Cash Flow to be
     applied to the outstanding balance of the Term Loan as provided in the last
     sentence of Section 2.08.

          (d)   Information   to   be   provided   to   Administrative    Agent.
     Contemporaneously  with making any deposit into the Tax Accrual Account and
     with making any  disbursement  out of the Tax Accrual Account to CRI, or to
     the shareholders of CRI or Borrower,  as applicable,  Borrower shall notify
     Administrative  Agent in writing regarding the amount(s) of such deposit(s)
     and/or disbursement(s),  accompanied by detailed calculations in support of
     the amount so deposited or disbursed,  in accordance with the provisions of
     this Section.

          5.37 Collateral  Audit.  Borrower shall exercise full  cooperation and
     diligence  to  facilitate  the  conduct by the  Documentation  Agent or its
     designees  of an audit  (but  not a title  examination)  of the  Collateral
     Assets,  accounts  receivable  and inventory of Borrower to be completed no
     later than 30 days after  Closing  (provided  that  Borrower  shall  afford
     Documentation  Agent as much additional time as is reasonably  necessary to
     enable Documentation Agent to complete such audit to its satisfaction). If,
     as the  result of such  audit,  Documentation  Agent  discovers  facts that
     reasonably warrant  modifications to the definition of "Eligible  Accounts"
     or "Revolving Loan Availability Amount," including, but not limited to, the
     percentages set forth in such latter definition,  the Documentation  Agent,
     with the approval of the Required Banks, shall have the right to amend such
     definitions in accordance with Documentation  Agent's standard  definitions
     and parameters for such terms (and substantially  similar terms) by sending
     written notice of such amendment to Borrower and the Banks, which amendment
     will take effect upon Borrower's receipt thereof.

                                  Article VI.

                               NEGATIVE COVENANTS

     Without  the prior  written  consent  of the  Administrative  Agent and the
Required Banks and so long as any part of the principal or interest on the Notes
shall remain unpaid or any Bank remains  obligated to make  advances  hereunder,
Borrower covenants that it will not:

     6.01  Other  Indebtedness.  Incur,  create,  assume  or suffer to exist any
Indebtedness,  whether  by way of loan  or the  issuance  or sale of  securities
except Permitted Indebtedness.

     6.02  Loans  or  Advances.  Make  or  agree  to  make or  allow  to  remain
outstanding  any loans or advances to any Person,  except advances or extensions
of credit in the form of accounts  receivable incurred in the ordinary course of
business.

     6.03  Mortgages or Pledges of Assets.  Create,  incur,  assume or permit to
exist, any mortgage,  pledge,  security interest,  lien or encumbrance on any of
its properties or assets (now owned or hereafter acquired), except for Permitted
Encumbrances.

     6.04 Sales of Assets.  Except  for  Permitted  Asset  Sales,  sell,  lease,
assign,  transfer  or  otherwise  dispose  of, in one or any  series of  related
transactions, all or any portion of its Oil and Gas Properties or other material
assets,  whether  now  owned  or  hereafter  acquired,  including  transfers  to
Subsidiaries,  nor enter into any arrangement,  directly or indirectly, with any
Person  to sell and rent or  lease  back as  lessee  such  property  or any part
thereof  which is  intended  to be used for  substantially  the same  purpose or
purposes as the property sold or transferred.

     6.05  Payment of  Accounts  Payable.  Allow any  account  payable to remain
unpaid more than ninety (90) days after the date of the invoice therefor, except
such as are (i) being contested in good faith and as to which adequate provision
or accrual has been made, or (ii) the subject of usual and customary  review and
evaluation.

     6.06 Cancellation of Insurance.  Allow any property and casualty  insurance
policy  required to be carried  hereunder  to be  terminated  or lapse or expire
without provision for adequate renewal or replacement thereof.

     6.07 Investments.  Make Investments in or purchase or otherwise acquire all
or substantially  all of the assets of any Person, or any shares of stock of, or
similar interest in, any other Person, if the result of such action would impair
the ability of the Borrower to perform any of its  Obligations  pursuant to this
Agreement,   including,   without  limitation,   the  obligation  to  repay  the
Indebtedness  evidenced  by the Notes,  except that the  Borrower  may invest in
instruments that are investment grade, and in short-term commercial paper.

     6.08  Changes  in  Structure  or  Business.  Consolidate  or merge  with or
purchase (for cash or  securities),  all or  substantially  all of the assets or
capital stock of any corporation,  firm, association or enterprise, or allow any
such  entity to be  merged  into the  Borrower,  or  change  the basic  business
operations  of  the  Borrower,  unless  all  of  the  following  conditions  are
satisfied:  (a) Borrower has provided Administrative Agent complete and detailed
information  relating to such merger or purchase at least  fifteen  (15) days in
advance thereof,  (b) Borrower is the survivor of such merger or the acquiror in
any such purchase, and (c) such merger or purchase will not otherwise constitute
or result in an Event of Default or Unmatured  Event of Default  under any other
provisions of this Agreement.

     6.09 Pooling or Unitization.  Voluntarily pool or unitize,  all or any part
of the Collateral  Assets where the pooling or  unitization  would result in the
diminution  of the  Borrower's  net revenue from  production  from the pooled or
unitized  lands,  without the Required  Banks' prior consent,  which will not be
unreasonably  withheld.  Any unitization,  pooling or  communitization  or other
action or  instrument  in violation of this Section 6.10 shall be of no force or
effect against any Bank.

     6.10 Hedge  Agreements.  Except for  Permitted  Hedge  Agreements  of which
Borrower  has notified  Administrative  Agent in writing at or prior to the time
that Borrower  becomes party thereto,  enter into or become  obligated under any
contract  for sale  for  future  delivery  of  Hydrocarbons  other  than  normal
production  contracts  entered into in the Borrower's  normal course of business
(whether or not the subject Hydrocarbons are to be delivered), forward contract,
Hedging Agreement,  futures contract or any other similar agreement, without the
prior written consent of the Required Banks, acting in their sole discretion.

     6.11 Capital Stock of Borrower/Redemption of Senior Subordinated Notes. (a)
issue,  redeem,  purchase,  retire  or  otherwise  acquire  for value any of its
capital stock or Senior Subordinated Notes or grant, issue, purchase,  retire or
otherwise acquire for value any warrant,  right, or option pertaining thereto or
other security  convertible into any of the foregoing;  (b) permit any transfer,
sale,  redemption,   retirement,  or  other  change  in  the  ownership  of  the
outstanding  capital stock of the  Borrower;  or (c) enter into any agreement or
adopt any plan that would require it to do anything prohibited by clauses (a) or
(b); in any case without the prior written consent of the Required Banks, acting
in  their  discretion;  except  for  issuance,  transfer  or  repurchase  of the
Borrower's  capital  stock  which  does not  result  in a Change of  Control  or
otherwise  constitute or result in an Event of Default or an Unmatured  Event of
Default under any other provisions of this Agreement.

     6.12 Margin Stock. Directly or indirectly apply any part of the proceeds of
the Loans to the purchasing or carrying of any "margin stock" within the meaning
of Regulation U of the Board of Governors of the Federal Reserve System,  or any
regulations, interpretations or rulings thereunder.

     6.13 Amendment,  Termination or Waiver of Material Contracts.  Terminate or
allow any Material  Contract to be  terminated  prior to the  expiration  of its
stated  term;  waive  noncompliance  with the  material  terms  of any  Material
Contract  by any party  thereto;  or amend the  material  terms of any  Material
Contracts  such that the terms of the Material  Contract,  as amended,  are less
favorable to the Borrower than immediately before such amendment.

     6.14 Current Ratio.  Permit as of the end of any fiscal quarter its Current
Ratio to be less than 1.00 to 1.00.

     6.15 Interest Charge Coverage  Ratio.  Permit,  as of the end of any fiscal
quarter,  the ratio of EBITDA to Borrower's  Total Interest Charges to be lesser
than 3.00 to 1.0,  calculated on a rolling  four-quarter  basis. For purposes of
this Section,  the term "Total Interest Charges" means all cash interest charges
of Borrower.

     6.16  Fixed  Charge  Coverage  Ratio.  Permit,  as of the end of any fiscal
quarter, the ratio of EBITDA to Borrower's Total Fixed Charges to be lesser than
1.50 to 1.0,  calculated on a rolling  four-quarter  basis. For purposes of this
Section,  the term  "Total  Fixed  Charges"  means  all cash  interest  charges,
maintenance capital expenditures,  scheduled and required principal amortization
and cash dividends.

     6.17 Senior Debt to EBITDA.  Permit,  as of the end of any fiscal  quarter,
the ratio of Aggregate  Outstanding Credit Exposure to EBITDA to be greater than
3.5 to 1.0 from Closing through  September 30, 2004; 3.25 to 1.0 from October 1,
2004 through March 31, 2005; and 3.00 to 1.00  thereafter,  each case calculated
on a rolling four-quarter basis.

     6.18 Rolling  Four-Quarter Basis. For purposes of Section 6.17 through 6.19
hereof, EBITDA on a rolling four-quarter basis shall be calculated:  (a) for the
period ending December 31, 2003, by multiplying EBITDA accrued during the fiscal
quarter ended  December 31, 2003 times four; (b) for the period ending March 31,
2004,  by  multiplying  EBITDA  accrued  during the period from  October 1, 2003
through  March 31,  2004 times two;  for the period  ending  June 30,  2004,  by
multiplying  EBITDA  accrued during the period from October 1, 2003 through June
30, 2004 times 1.33; (d) for the period ending September 30, 2004 and at the end
of  each  subsequent  fiscal  quarter,   based  on  EBITDA  accrued  during  the
four-quarter period ending on such date.

                                  Article VII.

                                EVENTS OF DEFAULT

     7.01 Enumeration of Events of Default. Any of the following events shall be
considered an Event of Default as that term is used herein:

     (a) Default shall be made by the Borrower in the payment of any installment
of  principal  or  interest  (including,   without  limitation,   any  mandatory
prepayments  payable  pursuant to either Section 2.07 or 2.08 of this Agreement)
on  the  Notes,  any  LC  Fee  or any  other  monetary  obligation  (other  than
Reimbursement  Obligations)  payable hereunder when due, or any other fee due to
any Bank Party hereunder  within five (5) days after such payment was due, or in
the payment of any  Reimbursement  Obligation  within one Business Day after the
same becomes due;

     (b)  Default  shall  be  made by the  Borrower  in the  due  observance  or
performance of any affirmative  covenant required in this Agreement,  the Notes,
the  Facility LC  Applications  or the  Security  Instruments  and such  default
continues  for more than thirty  (30) days after the  earlier  of: (i)  Borrower
having knowledge thereof, or (ii) Borrower receiving written notice thereof from
the Administrative Agent;

     (c)  Default  shall  be  made by the  Borrower  in the  due  observance  or
performance of any negative covenant required in this Agreement,  the Notes, the
Facility LC Applications or the Security Instruments;

     (d) Any representation or warranty herein made by the Borrower proves to be
untrue  in any  respect  material  to  the  Borrower,  provided  that  any  such
representation  or warranty that either expressly or by its context  necessarily
relates only to a specific time need be true only as of such  specific  time, or
any representation,  statement (including Financial Statements),  certificate or
data furnished or made by the Borrower to the Administrative Agent in connection
herewith  proves to have been untrue in any respect  material to the Borrower as
of the date the facts therein set forth were stated or certified;

     (e) Default shall be made by any Borrower (as principal or other surety) in
payment  or  performance  of any  bond,  debenture,  note or other  evidence  of
Indebtedness for borrowed money, or under any credit agreement,  loan agreement,
indenture,  promissory  note or similar  agreement  or  instrument  executed  in
connection  with  any of  the  forgoing,  relating  to  any  Indebtedness  in an
aggregate  amount  of One  Million  Dollars  ($1,000,000.00)  or more,  and such
default shall remain  unremedied  for in excess of the period of grace,  if any,
with respect thereto.

     (f) At a time when Borrower  continues to be a Subsidiary  of CRI,  default
shall be made by CRI under the CRI Credit Agreement, or default shall be made by
CRI with respect to the Senior  Subordinated  Notes,  and any such default shall
remain  unremedied  for in excess of the period of grace,  if any,  with respect
thereto.

     (g) Borrower (i) discontinues its usual business or applies for or consents
to the  appointment  of a  receiver,  trustee  or  liquidator  of it or all or a
substantial part of its assets, or (ii) files a voluntary petition  commencing a
case  under  Title  11  of  the  United   States  Code,   seeking   liquidation,
reorganization   or   rearrangement  or  taking  advantage  of  any  bankruptcy,
insolvency,  debtor's relief or other similar Law of the United States the State
of Texas or any other jurisdiction,  or (iii) makes a general assignment for the
benefit of creditors,  or (iv) is unable,  or admits in writing its inability to
pay its debts generally as they become due, or (v) files an answer admitting the
material  allegations of a petition filed against it in any case commenced under
Title  11  of  the  United  States  Code  or  any  reorganization,   insolvency,
conservatorship or similar proceeding under any bankruptcy, insolvency, debtor's
relief or other  similar  Law of the  United  States,  the State of Texas or any
other jurisdiction;

     (h) An order,  judgment or decree shall be entered against  Borrower by any
court of competent  jurisdiction or by any other duly authorized  authority,  on
the petition of a creditor or otherwise,  granting  relief under Title 11 of the
United States Code or under any bankruptcy, insolvency, debtor's relief or other
similar Law of the United States, the State of Texas or any other  jurisdiction,
approving a petition  seeking  reorganization  or an arrangement of its debts or
appointing a receiver,  trustee,  conservator,  custodian or liquidator of it or
all or any substantial  part of its assets,  and the failure to have such order,
judgment or decree dismissed within thirty (30) days of its entry;

     (i)  Borrower  has  concealed,  removed,  or  permitted  to be concealed or
removed,  any part of its property,  with intent to hinder, delay or defraud its
creditors  or any of them;  or has made or  suffered  a  transfer  of any of its
property  which  would  be  characterized  as  a  fraudulent   conveyance  under
bankruptcy  or similar  Laws; or has made any transfer of its property to or for
the benefit of a creditor at a time when other creditors similarly situated have
not been paid; or has suffered or permitted,  while  insolvent,  any creditor to
obtain a lien upon any of its property  through legal  proceedings  or distraint
which is not vacated within thirty (30) days from the date thereof;

     (j) the Liens under the Security Instruments cease to be perfected or cease
to be first priority Liens subject to only Permitted Encumbrances; or

     (k) a Material Adverse Change occurs.

     7.02 Rights Upon Unmatured Event of Default.  At any time that there exists
an Unmatured Event of Default,  any obligation of the Banks and the LC Issuer to
make Credit  Extensions shall be suspended  unless and until the  Administrative
Agent,  with  the  approval  of the  Super-Majority  and  the LC  Issuer,  shall
reinstate the same in writing,  the  Unmatured  Event of Default shall have been
waived by the Administrative  Agent, with approval of the Super-Majority and the
LC Issuer or the relevant  Unmatured  Event of Default  shall have been remedied
prior to ripening into an Event of Default.

     7.03  Rights  Upon  Default.  Upon the  happening  of an  Event of  Default
specified in Subsections  7.01 (g) or (h), the  obligations of the Banks and the
LC Issuer to make Credit Extensions hereunder shall automatically  terminate and
all  Obligations  then  outstanding  hereunder and the interest  accrued thereon
shall  automatically  become immediately due and payable without any election or
action on the part of the Administrative  Agent, any Bank or the LC Issuer. Upon
the happening and during the  continuation  of any other Event of Default,  upon
the request of the  Super-Majority  subject to Section 9.13, the  Administrative
Agent shall  terminate or suspend the obligations of the Banks and the LC Issuer
to  make  Credit  Extensions  hereunder,   or  declare  the  Obligations  to  be
immediately due and payable,  or both, and upon such declaration with respect to
the Obligations they shall become  immediately due and payable.  In either case,
the entire  principal and interest shall  thereupon  become  immediately due and
payable,  without notice  (including,  without  limitation,  notice of intent to
accelerate   maturity  or  notice  of  acceleration  of  maturity)  and  without
presentment,  demand,  protest,  notice of protest or other notice of default or
dishonor of any kind, except as provided to the contrary  elsewhere herein,  all
of which are hereby expressly waived by the Borrower.

     If,  within  thirty  (30) days after  acceleration  of the  maturity of the
Obligations or termination of the obligations of the Banks and LC Issuer to make
Credit  Extensions  hereunder as the result of any Event of Default  (other than
any Event of Default  specified  in  subsections  7.01(g) or (h)) and before any
judgment  or decree  for the  payment  of the  Obligations  due shall  have been
obtained or entered,  the Super-Majority (in their sole discretion) shall direct
with respect to the  Obligations  relating to the Loans or the LC Issuer (in its
sole discretion)  shall direct with respect to Obligations  relating to Facility
LCs, the  Administrative  Agent shall,  by notice to the  Borrower,  rescind and
annul such acceleration and/or termination.

     7.04 Remedies. After any acceleration, as provided for in Section 7.03, the
Bank Parties  shall have,  in addition to the rights and remedies  given them by
this Agreement and the Security Instruments, all those allowed by all applicable
Laws, including, but without limitation,  the Uniform Commercial Code as enacted
in any  jurisdiction  in which  any of the  Collateral  Assets  may be  located.
Without limiting the generality of the foregoing, the Administrative Agent, upon
the  request  of  the  Super-Majority  shall,   immediately  without  demand  of
performance  and without other notice (except as  specifically  required by this
Agreement or the Security Instruments) or demand whatsoever to the Borrower, all
of which are hereby expressly waived, and without advertisement,  sell at public
or private sale or otherwise realize upon, in Garfield County,  Oklahoma,  or in
any other place  where the  Collateral  Assets may be located,  or in such other
place or places as the  Administrative  Agent may designate,  the whole or, from
time to time,  any part of the  Collateral  Assets,  or any  interest  which the
Borrower may have therein.  After  deducting  from the proceeds of sale or other
disposition  of the  Collateral  Assets all expenses  (including  all reasonable
expenses  for legal  services),  the Bank shall apply such  proceeds  toward the
satisfaction   of  the   Obligations.   Any  remainder  of  the  proceeds  after
satisfaction  in full of the  Obligations  shall be  distributed  as required by
applicable Laws.  Notice of any sale or other  disposition shall be given to the
Borrower  at least five (5) days  before  the time of any public  sale or of the
time  after  which  any  intended  private  sale  or  other  disposition  of the
Collateral  Assets is to be made,  which the  Borrower  hereby  agrees  shall be
reasonable  notice of such sale or other  disposition.  The  Borrower  agrees to
assemble, or to cause to be assembled, at its own expense,  documents evidencing
its ownership of the Collateral  Assets and such other documents or items as the
Administrative  Agent  may  reasonably  request  at such  place or places as the
Administrative Agent shall designate. At any such sale or other disposition, the
Administrative Agent and/or any Bank, to the extent permissible under applicable
Laws, may purchase the whole or any part of the Collateral Assets, free from any
right of redemption  on the part of the  Borrower,  which right is hereby waived
and released.  Without limiting the generality of any of the rights and remedies
conferred upon the Administrative  Agent for the benefit of the Banks under this
paragraph,  the  Administrative  Agent may, to the full extent  permitted by the
applicable Laws:

          (A) Enter  upon the  premises  of the  Borrower  (and,  to the  extent
     necessary in the judgment of the  Administrative  Agent,  exclude therefrom
     the Borrower or any Affiliate thereof) and take immediate possession of the
     Collateral Assets, either personally or by means of a receiver appointed by
     a court of competent jurisdiction, using all necessary force to do so;

          (B) At the Administrative  Agent's option,  use, operate,  manage, and
     control the Collateral Assets in any lawful manner;

          (C) Collect and receive all rents, income, revenue,  earnings, issues,
     and profits therefrom for the benefit of the Banks; and

          (D) Maintain, repair, renovate, alter, or remove the Collateral Assets
     as the Banks may determine in their discretion.

     7.05 Right of Set-off.  Upon the  occurrence of any Event of Default,  each
Bank may, and is hereby authorized by the Borrower, at any time and from time to
time, to the fullest extent permitted by applicable Laws, without advance notice
to the  Borrower  (any such  notice  being  expressly  waived by the  Borrower),
set-off and apply any and all  deposits  (general  or  special,  time or demand,
provisional  or final) at any time held and any other  indebtedness  at any time
owing by such Bank to or for the credit or the account of the  Borrower  against
any or all of the Obligations of the Borrower now or hereafter existing, whether
or not such  Obligations  have matured and irrespective of whether such Bank may
have  exercised any other rights that they have or may have with respect to such
Obligations,  including,  without limitation, any acceleration rights. Each Bank
agrees  promptly to notify the Borrower after any such set-off and  application,
provided  that the failure to give such notice  shall not affect the validity of
such  set-off and  application.  The rights of each Bank under this Section 7.05
are in addition to the other rights and remedies (including, without limitation,
other rights of set-off) which the Banks may have.

                                 Article VIII.

                                   THE AGENTS

     8.01 Authorization and Action.  Each Bank hereby  irrevocably  appoints and
authorizes  each Agent to act on its behalf and to exercise  such  powers  under
this Agreement and the other Loan Documents as are specifically  delegated to or
required  of such Agent by the terms  hereof  and  thereof,  together  with such
powers as are  reasonably  incidental  thereto.  As to any matters not expressly
provided for by this Agreement or the other Loan Documents  (including,  without
limitation,  enforcement or collection of the Notes), no Agent shall be required
to exercise any  discretion or take any action,  but shall be required to act or
to refrain from acting (and, as between such Agent and the Banks, shall be fully
protected in so acting or refraining  from acting) upon the  instructions of the
Required Banks,  and such  instructions  shall be binding upon all Banks and all
holders of Notes; provided, however, that no Agent shall be required to take any
action which  exposes  such Agent to personal  liability or which is contrary to
this Agreement, the other Loan Documents or applicable law.

     8.02 Agent's  Reliance,  Etc.  Neither any Agent nor any of its  directors,
officers,  agents or employees  shall be liable to any Bank for any action taken
or omitted to be taken by it or them under or in connection  with this Agreement
or the other  Loan  Documents  (i) with the  consent  or at the  request  of the
Required  Banks or (ii) in the absence of its or their own gross  negligence  or
willful  misconduct (it being the express intention of the parties that no Agent
nor its directors,  officers,  agents and employees shall have any liability for
actions and omissions under this Section 8.02 resulting from their sole ordinary
or  contributory  negligence).  Without  limitation  of  the  generality  of the
foregoing,  each  Agent:  (i) may treat  the  payee of each  Note as the  holder
thereof until such Agent  receives  written notice of the assignment or transfer
thereof signed by such payee and in form  satisfactory  to such Agent;  (ii) may
consult  with  legal  counsel  (including  counsel  for  Borrower  or any of its
Subsidiaries),  independent  public accountants and other experts selected by it
and shall not be liable  for any  action  taken or  omitted  to be taken in good
faith by it in  accordance  with the  advice  of such  counsel,  accountants  or
experts;  (iii) makes no warranty or representation to any Bank and shall not be
responsible to any Bank for any statements,  warranties or representations  made
in or in connection with this Agreement or the other Loan Documents; (iv) except
as otherwise expressly provided herein,  shall not have any duty to ascertain or
to inquire as to the performance or observance of any of the terms, covenants or
conditions  of this  Agreement  or the other Loan  Documents  or to inspect  the
property (including the books and records) of Borrower and its Subsidiaries; (v)
shall not be responsible to any Bank for the due execution,  legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or the other
Loan Documents or any other instrument or document  furnished pursuant hereto or
thereto; and (vi) shall incur no liability under or in respect of this Agreement
or the other Loan Documents by acting upon any notice,  consent,  certificate or
other  instrument  or writing  (which may be by telegram,  telecopier,  cable or
telex) reasonably  believed by it to be genuine and signed or sent by the proper
party or parties;  and (vii) the  provisions  of this Section 8.02 shall survive
the termination of this Agreement and/or the payment or assignment of any of the
Indebtedness under this Agreement.

     8.03 Each Agent and its  Affiliates.  With respect to its  Commitment,  the
Credit  Extensions  made by it and the Note  issued to it as a Bank,  each Agent
shall have the same  rights and powers  under this  Agreement  or the other Loan
Documents  as any other Bank and may  exercise the same as though it were not an
Agent. The term "Bank" or "Banks" shall, unless otherwise  expressly  indicated,
include each Agent in its individual capacity. Each Agent and its affiliates may
accept  deposits  from,  lend money to, act as trustee under  indentures of, and
generally  engage in any kind of business with  Borrower,  any of its respective
Subsidiaries  and any  Person  who may do  business  with or own  securities  of
Borrower, any of its respective  Subsidiaries,  all as if such Agent were not an
Agent and without any duty to account therefor to the Banks.

     8.04 Bank Credit Decision.  Each Bank  acknowledges and agrees that it has,
independently  and without reliance upon the  Administrative  Agent or any other
Agent and based on the Financial Statements referred to in Section 5.04 and such
other  documents  and  information  as it has deemed  appropriate,  made its own
credit  analysis  and  decision  to enter  into this  Agreement.  Each Bank also
acknowledges  and agrees that it will,  independently  and without reliance upon
the  Administrative  Agent or any other  Agent and based on such  documents  and
information as it shall deem  appropriate at the time,  continue to make its own
credit  decisions in taking or not taking  action under this  Agreement  and the
other Loan Documents.

     8.05  Agent's  Indemnity.  No Agent  shall be  required  to take any action
hereunder or to prosecute or defend any suit in respect of this Agreement or the
other Loan  Documents  unless  indemnified to such Agent's  satisfaction  by the
Banks against loss, cost,  liability and expense.  If any indemnity furnished to
such Agent shall become impaired, it may call for additional indemnity and cease
to do the acts indemnified against until such additional  indemnity is given. In
addition,  the Banks agree to indemnify such Agent (to the extent not reimbursed
by Borrower), ratably according to the respective principal amounts of the Notes
then held by each of them (or if no Notes are at the time  outstanding,  ratably
according to either (i) the respective amounts of their Commitments,  or (ii) if
no  Commitments  are  outstanding,  the  respective  amounts of the  Commitments
immediately  prior to the time the Commitments  ceased to be outstanding),  from
and against any and all liabilities,  obligations,  losses, damages,  penalties,
actions,  judgments,  suits,  costs,  expenses or  disbursements  of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against such
Agent in any way  relating  to or arising  out of this  Agreement  or any action
taken or omitted by such Agent under this  Agreement or the other Loan Documents
(including,  without limitation, any action taken or omitted under Article II of
this Agreement);  provided, that no Bank shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from such Agent's gross negligence or
willful misconduct.  Each Bank agrees, however, that it expressly intends, under
this Section  8.05,  to indemnify  each Agent  ratably as aforesaid for all such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs,  expenses and disbursements arising out of or resulting from such Agent's
ordinary or contributory negligence.  Without limitation of the foregoing,  each
Bank agrees to reimburse  such Agent  promptly upon demand for its ratable share
of any out-of-pocket  expenses  (including  reasonable counsel fees) incurred by
such Agent in connection with the  preparation,  execution,  administration,  or
enforcement of, or legal advice in respect of rights or responsibilities  under,
this Agreement and the other Loan Documents to the extent that such Agent is not
reimbursed  for such expenses by Borrower.  The  provisions of this Section 8.05
shall survive the termination of this Agreement and/or the payment or assignment
of any of the Indebtedness under this Agreement.

     8.06 Successor Agents.  Each Agent may resign at any time by giving written
notice  thereof to the Banks and  Borrower  and may be removed as an Agent under
this Agreement and the other Loan Documents at any time with or without cause by
the Required  Banks.  Upon any such  resignation or removal,  the Required Banks
with the  concurrence  of  Borrower  shall have the right to appoint a successor
Agent. If no successor Agent shall have been so appointed by the Required Banks,
and shall have  accepted  such  appointment,  within 30 calendar  days after the
retiring  Agent's giving of notice of resignation or the Required Banks' removal
of the retiring  Agent,  then the retiring Agent may, on behalf of the Banks and
with the concurrence of Borrower, appoint a successor Agent. Upon the acceptance
of any  appointment  as Agent  hereunder and under the other Loan Documents by a
successor  Agent,  such successor  Agent shall  thereupon  succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this  Agreement  and the  other  Loan  Documents.  After  any  retiring  Agent's
resignation  or removal as Agent  hereunder and under the other Loan  Documents,
the provisions of this Article VIII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this  Agreement  and
the other Loan Documents.

     8.07  Notice of  Default.  No Agent  shall be deemed to have  knowledge  or
notice of the  occurrence of any Unmatured  Event of Default or Event of Default
hereunder  unless such Agent shall have received  notice from a Bank or Borrower
referring to this Agreement, describing such Unmatured Event of Default or Event
of Default and stating  that such notice is a "notice of  default." If any Agent
receives  such a notice,  such  Agent  shall give  notice  thereof to the Banks;
provided, however, if such notice is received from a Bank, such Agent also shall
give notice thereof to Borrower.  The Administrative  Agent shall be entitled to
take action or refrain from taking action with respect to such  Unmatured  Event
of Default or Event of Default as provided in Section 8.01 and Section 8.02.

                                  Article IX.

                                  MISCELLANEOUS

     9.01  Security  Interests  in Deposits  and Right of Offset or the Banker's
Lien. The Borrower hereby transfers,  assigns, pledges and grants to each Bank a
security  interest  (as  security  for the  payment  and/or  performance  of the
Obligations   of  the   Borrower,   with  such  interest  of  each  Bank  to  be
retransferred,  reassigned  and/or  released  by such Bank at the expense of the
Borrower upon payment in full and/or complete performance by the Borrower of all
such  Obligations)  and the right,  exercisable  at such time as any  obligation
hereunder shall mature,  whether by  acceleration  of maturity or otherwise,  of
offset or banker's lien against all funds or other  property of the Borrower now
or hereafter or from time to time on deposit with or in the  possession  of such
Bank,  including,  without  limitation,  all  certificates  of deposit and other
depository accounts.

     9.02  Survival  of   Representations,   Warranties   and   Covenants.   All
representations  and warranties of the Borrower and all covenants and agreements
herein  made shall  survive  the  execution  and  delivery of the Notes and this
Agreement so long as any debt is outstanding  under the Notes, or any renewal or
extension of this Agreement or the Notes, or the Banks remain  obligated to make
advances hereunder.

     9.03 Notices and Other Communications. Notices, requests and communications
hereunder  shall be in  writing  and  shall be  sufficient  in all  respects  if
delivered  to the  relevant  address  indicated  below  (including  delivery  by
registered or certified United States mail, facsimile, telex, telegram or hand):

          (A) If to
                           Borrower:        CONTINENTAL GAS, INC.
                                            205 West Maple, Suite 1100
                                            Enid, Oklahoma 73701
                                            Attention: Randy Moeder

          (B) If to
                           any of the
                           Bank Parties:    UNION BANK OF CALIFORNIA, N.A.
                                            500 North Akard, Suite 4200
                                            Dallas, Texas 75201
                                            Attention: John Clark

     Any party may, by proper written notice hereunder to the other,  change the
individuals or addresses to which such notices to it shall thereafter be sent.

     9.04 Parties in Interest.  All covenants and agreements herein contained by
or on  behalf  of the  Borrower  shall  be  binding  upon the  Borrower  and its
successors  and assigns  and inure to the benefit of the Bank  Parties and their
respective successors and assigns.

     9.05 Successors and Assigns; Participation; Purchasing Banks.

     (a) Whenever in this  Agreement  any of the parties  hereto is referred to,
such reference  shall be deemed to include the successors and permitted  assigns
of such party;  and all  covenants,  promises and  agreements by or on behalf of
Borrower,  the  Administrative  Agent or the Banks  that are  contained  in this
Agreement shall bind and inure to the benefit of their respective successors and
permitted  assigns.  Borrower  may not assign or  transfer  any of its rights or
obligations hereunder without the written consent of all the Banks.

     (b) Each Bank may, without the consent of Borrower,  sell participations to
one or more  banks or other  financial  institutions  in all or a portion of its
rights  and  obligations  under  this  Agreement  and the other  Loan  Documents
(including,  without limitation,  all or a portion of its Commitment,  the Loans
owing to it, and the Notes held by it); provided,  however, that (i) the selling
Bank's  obligations  under this  Agreement  and the other Loan  Documents  shall
remain  unchanged,  (ii) such Bank shall remain solely  responsible to the other
parties hereto for the  performance of such  obligations,  (iii)  Borrower,  the
Administrative  Agent,  and the other  Banks  shall  continue to deal solely and
directly  with the  selling  Bank in  connection  with such  Bank's  rights  and
obligations under this Agreement and the other Loan Documents,  (iv) the selling
Bank shall remain the holder of its Note(s) for all purposes of this  Agreement,
and (v) no  participant  under any such  participation  shall  have any right to
approve any amendment or waiver of any provision of this  Agreement or any Note,
or any consent to any departure by the Borrower therefrom,  except to the extent
that such  amendment,  waiver or consent  would reduce to the  principal  of, or
interest on, the Notes or any fees or other amounts payable  hereunder,  in each
case to the extent  subject to such  participation,  or postpone  any  regularly
scheduled  payment of  principal  of, or  interest  on, the Notes or any fees or
other  amounts  payable  hereunder,  in each case to the extent  subject to such
participation.

     (c) With the prior  written  consent  of  Borrower  and the  Administrative
Agent,  each  Bank  may  assign  to one or  more  banks  or  other  entities  (a
"Purchasing  Bank"),  all or a portion of its interests,  rights and obligations
under  this  Agreement  and  the  other  Loan  Documents   (including,   without
limitation, all or a portion of its Commitment and the same portion of the Loans
at the time owing to it and the Notes held by it); provided,  however,  that (i)
each such assignment  shall be of a constant,  and not a varying,  percentage of
all the assigning  Bank's rights and  obligations  under this  Agreement and the
other  Loan  Documents,  (ii)  after  giving  effect  to  such  assignment,  the
Purchasing Bank's  Commitment must be at least $5,000,000  (either solely as the
result of such assignment or as the result of multiple  assignments  from two or
more assigning  Banks),  (iii) the parties to each such assignment shall execute
and  deliver  to the  Administrative  Agent  a  Commitment  Transfer  Supplement
together with any Notes subject to such Commitment Transfer Supplement, (iv) the
assigning  Bank shall pay to  Administrative  Agent an assignment fee of $3,500,
(v) an assigning Bank shall not assign a portion of such Bank's Commitment in an
amount  less  than an  amount  equal to the  lesser  of such  Bank's  Commitment
hereunder  and  $2,500,000  and  (vi) if the  assigning  Bank has  retained  any
Commitment  hereunder,  such  assigning  Bank's  Commitment  shall  be at  least
$5,000,000  after giving  effect to such  assignment.  Upon such  execution  and
delivery,  from and  after  the  effective  date  specified  in each  Commitment
Transfer  Supplement,  which effective date shall be at least five Business Days
after the execution  thereof (x) the Purchasing Bank thereunder shall be a party
hereto  and,  to the  extent  herein  provided  in  such,  have the  rights  and
obligations of a Bank hereunder and (y) the assignor Bank  thereunder  shall, to
the extent provided in such assignment,  be released from its obligations  under
this  Agreement and the other Loan  Documents  (and, in the case of a Commitment
Transfer Supplement covering all of the remaining portion of an assigning Bank's
rights and obligations  under this Agreement and the other Loan Documents,  such
Bank shall cease to be a party  hereto).  Such  Commitment  Transfer  Supplement
shall be deemed to amend this  Agreement to the extent,  and only to the extent,
necessary  to reflect the  addition of such  Purchasing  Bank and the  resulting
adjustment of  Percentage  Shares  arising from the purchase by such  Purchasing
Bank of all or a portion of the rights and  obligations  of such  assigning Bank
under this Agreement, the Notes and the other Loan Documents.

     (d) The  Administrative  Agent shall  maintain at its office a copy of each
Commitment  Transfer  Supplement   delivered  to  it  and  a  register  for  the
recordation  of the names and addresses of the Banks and the  Commitment  Amount
of, and principal amount of the Loans owing to, each Bank from time to time (the
"Register").  The entries in the Register shall be conclusive, in the absence of
manifest error, and Borrower,  the Administrative Agent, and the Banks may treat
each Person whose name is recorded in the Register as a Bank  hereunder  for all
purposes of this  Agreement.  The Register  shall be available for inspection by
Borrower  or any  Bank at any  reasonable  time  and  from  time  to  time  upon
reasonable prior notice.

     (e) Upon its receipt of a  Commitment  Transfer  Supplement  executed by an
assigning  Bank and a Purchasing  Bank  together  with any Notes subject to such
Commitment  Transfer  Supplement  and the  written  consent  to such  Commitment
Transfer  Supplement,  the Administrative Agent shall (i) accept such Commitment
Transfer  Supplement,  (ii)  record  the  information  contained  therein in the
Register and (iii) give prompt notice thereof to the Banks and Borrower.  Within
five (5) Business Days after receipt of such notice,  Borrower shall, at its own
expense,  execute and deliver to the  Administrative  Agent, in exchange for the
surrendered  Notes,  replacement  Notes dated as of the  effective  date of such
surrendered Notes and otherwise  substantially in the form of the Notes replaced
thereby  payable to the order of such  Purchasing Bank in an amount equal to the
Commitment assumed by it pursuant to such Commitment Transfer Supplement and, if
the assigning  Bank has retained any  Commitment  hereunder,  replacement  Notes
dated  as  of  the  effective  date  of  the  surrendered  Notes  and  otherwise
substantially  in the form of the Notes replaced thereby payable to the order of
the assigning  Bank in an amount equal to the  Commitment of such assigning Bank
retained  by it  hereunder.  Such  replacement  Notes  shall be in an  aggregate
principal  amount equal to the aggregate  principal  amount of such  surrendered
Notes.  Contemporaneously  with  the  delivery  of the  replacement  Notes,  the
canceled Notes shall be returned to Borrower marked "Replaced."

     (f) Each Bank  agrees  to hold any  confidential  information  which it may
receive from the Borrower  pursuant to this Agreement in confidence,  except for
disclosure  (i) to its  Affiliates  and to  other  Banks  and  their  respective
Affiliates, (ii) to legal counsel,  accountants, and other professional advisors
to such Bank,  (iii) to  regulatory  officials,  (iv) to any Person as requested
pursuant to or as  required by law,  regulation,  or legal  process,  (v) to any
Person in  connection  with any legal  proceeding to which such Bank is a party,
(vi) to such  Bank's  direct  or  indirect  contractual  counterparties  in swap
agreements or to legal counsel,  accountants and other professional  advisors to
such  counterparties,  and (vii) permitted by this Section.  Notwithstanding any
other  provision  herein,  any Bank may, in  connection  with any  assignment or
participation or proposed  assignment or participation  pursuant to this Section
9.05,   disclose  to  the  assignee  or  participant  or  proposed  assignee  or
participant,  any  information  relating to Borrower or any other  Subsidiary of
Borrower  furnished  to such  Bank by or on  behalf  of  Borrower  or any  other
Subsidiary of Borrower;  provided, that prior to any such disclosure,  each such
assignee or  participant  or proposed  assignee  or  participant  shall agree to
preserve  the  confidentiality  of  any  confidential  information  relating  to
Borrower and any of its Subsidiaries  received from such Bank to the same extent
as required by this Section.

     (g)  Assignment  to  Federal  Reserve  Bank  or  Federal  Home  Loan  Bank.
Notwithstanding  any other language in this Agreement,  any Bank may at any time
assign all or any portion of its rights under this  Agreement and the Notes to a
Federal  Reserve Bank or a Federal Home Loan Bank as  collateral  in  accordance
with Regulation A and the applicable  operating circular of such Federal Reserve
Bank or Federal Home Loan Bank.

     9.06 Renewals and Extensions.  All provisions of this Agreement relating to
the Notes  shall  apply with equal  force and effect to each and all  promissory
notes  hereafter  executed  which  in  whole  or in part  represent  a  renewal,
extension,  amendment,   modification  or  rearrangement  of  any  part  of  the
Indebtedness originally represented by the Notes.

     9.07 No Waiver by the Bank Parties. No course of dealing on the part of the
Bank Parties,  their  officers or employees,  nor any failure or delay by any of
the Bank  Parties  with  respect  to  exercising  any of its  rights,  powers or
privileges under this Agreement,  the Notes,  the Facility LC Applications,  the
Security Instruments,  or any other instrument referred to herein or executed in
connection  with the Notes  shall  operate as a waiver  thereof.  The rights and
remedies of the Bank Parties under this  Agreement,  the Notes,  the Facility LC
Applications,  the Security  Instruments,  or any other  instrument  referred to
herein or executed in  connection  with the Notes  shall be  cumulative  and the
exercise or partial  exercise of any such right or remedy shall not preclude the
exercise of any other right or remedy.

     No Credit  Extensions  hereunder  shall  constitute  a waiver of any of the
covenants  or  warranties  of the  Borrower  contained  herein  or of any of the
conditions to the Banks' or the LC Issuer's  obligation  to make further  Credit
Extensions  hereunder.  In the event that the  Borrower is unable to satisfy any
such covenant,  warranty or condition,  no such Credit  Extension shall have the
effect of precluding the Banks or the LC Issuer from  thereafter  declaring such
inability to be an Event of Default as hereinabove provided.

     9.08 Waiver,  Release, and Indemnification by the Borrower.  To the maximum
extent permitted by applicable Laws, the Borrower:

          (A) Waives (1) protest of all commercial paper at any time held by any
     Bank on which the Borrower is in any way liable; (2) except as the same may
     herein be specifically  granted,  notice of  acceleration  and intention to
     accelerate;  and (3) notice and opportunity to be heard, after acceleration
     in the manner provided in Section 7.03,  before exercise by  Administrative
     Agent, any Bank or the LC Issuer of the remedies of self-help,  set-off, or
     of other  summary  procedures  permitted by any  applicable  Laws or by any
     agreement with the Borrower,  and,  except where required  hereby or by any
     applicable Laws, notice of any other action taken by Administrative  Agent,
     any Bank or the LC Issuer;

          (B)  Releases  each Agent,  each of the Bank Parties and the LC Issuer
     and their respective officers, employees,  directors, attorneys, and agents
     from all claims  for loss or damage  caused by any act or  omission  on the
     part of any of them except willful misconduct or gross negligence; and

          (C) Agrees to  indemnify  and hold the Bank  Parties and the LC Issuer
     and their respective officers, employees,  directors, attorneys, and agents
     harmless from and against all claims,  damages,  liabilities  and expenses,
     known or unknown,  accrued and unaccrued,  unless attributable to the gross
     negligence  or willful  misconduct  of the Bank  Parties,  the LC Issuer or
     their respective officers,  employees,  directors,  attorneys,  and agents,
     that may now or hereafter  be asserted  against any of the Bank Parties and
     the  LC  Issuer  and  their  respective  officers,  employees,   directors,
     attorneys,   and  agents  in   connection   with  or  arising  out  of  any
     investigation,  litigation or proceeding directly or indirectly relating to
     or arising out of any of the transactions contemplated by this Agreement.

     9.09  GOVERNING  LAW.  THIS  AGREEMENT  AND THE NOTE  SHALL BE DEEMED TO BE
CONTRACTS  MADE UNDER AND SHALL BE CONSTRUED IN ACCORDANCE  WITH AND GOVERNED BY
THE LAWS OF THE STATE OF TEXAS. EACH PARTY HERETO AGREES THAT IN CONNECTION WITH
ANY  LITIGATION  BROUGHT BY ANY PARTY  HERETO  AGAINST  ANY OTHER  PARTY  HERETO
SEEKING TO ENFORCE ANY RIGHTS,  REMEDIES OR OBLIGATIONS  UNDER THIS AGREEMENT OR
ANY OF THE OTHER  LOAN  DOCUMENTS,  EACH PARTY  CONCLUSIVELY  WAIVES IT RIGHT TO
TRIAL BY JURY.

     9.10  Incorporation  of Exhibits and Schedules.  The Exhibits and Schedules
attached to this Agreement are incorporated herein for all purposes and shall be
considered a part of this Agreement.

     9.11  Survival Upon  Unenforceability.  In the event any one or more of the
provisions contained in this Agreement, the Notes, the Security Instruments,  or
in any other  instrument  referred to herein or executed in connection  with the
Notes shall, for any reason, be held to be invalid,  illegal or unenforceable in
any respect,  such invalidity,  illegality or unenforceability  shall not affect
any other  provision  hereof or of any other  instrument  referred  to herein or
executed in connection herewith.

     9.12 Rights of Third Parties.  All provisions herein are imposed solely and
exclusively for the benefit of the Bank Parties and Borrower and no other Person
shall have  standing to require  satisfaction  of such  provisions in accordance
with their  terms or be  entitled  to assume  that any Bank will  refuse to make
advances in the absence of strict compliance with any or all thereof. Any or all
of  such   provisions  may  be  freely  waived  in  whole  or  in  part  by  the
Administrative  Agent,  the  Banks  and the LC  Issuer  at any  time if in their
discretion they deem it advisable to do so.

     9.13  Amendments  or  Modifications.  Subject  to the  provisions  of  this
Section,  the Required  Banks (or the  Administrative  Agent with the consent in
writing of the  Required  Banks)  and the  Borrower  may enter  into  agreements
supplemental hereto for the purpose of adding or modifying any provisions to the
Loan Documents or changing in any manner the rights of the Banks or the Borrower
hereunder or waiving any Event of Default hereunder; provided, however, that:

     (a) no such supplemental agreement shall, without the consent of all of the
Banks:

          (i) Extend the final  maturity  of any Loan,  postpone  any  regularly
     scheduled  payment of principal of any Loan,  forgive all or any portion of
     the  principal  amount  thereof,  or reduce  the rate or extend the time of
     payment of interest or fees thereon.

          (ii) Reduce the  percentage  specified in the  definition  of Required
     Banks.

          (iii)  Reduce  the   percentage   specified  in  the   definition   of
     Super-Majority.

          (iv) Extend the  Facility  Termination  Date,  or reduce the amount or
     extend the payment date for, the mandatory payments required under Sections
     2.07 or 2.08, or increase the Aggregate Commitment Amount or the Commitment
     of any Bank  hereunder,  or permit the  Borrower to assign its rights under
     this Agreement.

          (v)  Amend  the  requirement  that  the  Availability  Amount  may  be
     increased only with the consent of all Banks.

          (vi) Release any  guarantor of any Loan or,  except as provided in the
     Security  Instruments,  release all or substantially  all of the Collateral
     Assets.

          (vii) Amend this Section 9.13.

     (b) No  amendment  of any  provision  of  this  Agreement  relating  to the
Administrative  Agent shall be  effective  without  the  written  consent of the
Administrative Agent.

     9.14 Agreement  Construed as an Entirety.  This Agreement,  for convenience
only, has been divided into Articles and Sections and it is understood  that the
rights,  powers,  privileges,  duties and other legal  relations  of the parties
hereto shall be determined from this Agreement as an entirety and without regard
to the  aforesaid  division  into  Articles and  Sections and without  regard to
headings prefixed to said Articles or Sections.

     9.15 Number and Gender.  Whenever the context  requires,  reference  herein
made to the single number shall be understood to include the plural and likewise
the plural shall be understood to include the singular. Words denoting sex shall
be  construed  to  include  the  masculine,  feminine,  and  neuter,  when  such
construction  is  appropriate,  and specific  enumeration  shall not exclude the
general, but shall be construed as cumulative.

     9.16 AGREEMENT  SUPERSEDES ALL PRIOR AGREEMENTS.  THIS AGREEMENT,  TOGETHER
WITH THE NOTES, THE FACILITY LC APPLICATIONS,  THE SECURITY INSTRUMENTS, AND ANY
OTHER  WRITTEN  INSTRUMENTS  EXECUTED  PURSUANT  TO  THIS  AGREEMENT  REPRESENT,
COLLECTIVELY, THE FINAL AGREEMENT BETWEEN THE PARTIES HERETO WITH RESPECT TO THE
SUBJECT   HEREOF   AND  MAY  NOT  BE   CONTRADICTED   BY   EVIDENCE   OF  PRIOR,
CONTEMPORANEOUS,  OR  SUBSEQUENT  ORAL  AGREEMENTS  OF  THE  PARTIES  AND  SHALL
SUPERSEDE ANY PRIOR  AGREEMENT  BETWEEN THE PARTIES  HERETO,  WHETHER WRITTEN OR
ORAL,  RELATING TO THE SUBJECT HEREOF,  UNLESS SUCH PRIOR AGREEMENT IS EXPRESSLY
CONTINUED  IN EFFECT  UNDER  THE  TERMS  HEREOF.  THERE  ARE NO  UNWRITTEN  ORAL
AGREEMENTS BETWEEN THE PARTIES.

     9.17  Controlling  Provision  Upon  Conflict.  In the  event of a  conflict
between the provisions of this Agreement and those of the Notes, the Facility LC
Applications,  the  Security  Instruments  or any other  instrument  referred to
herein  or  executed  in  connection  with the  Notes,  the  provisions  of this
Agreement  shall  control;  provided if any of the Facility LC  Applications  or
Security  Instruments contain any representations,  warranties,  or covenants of
the  Borrower  that are in addition to or are more  restrictive  on the Borrower
than those set forth in this  Agreement,  such  additional  or more  restrictive
representations, warranties, and covenants shall control.

     9.18 Time, Place and Method of Payments.  All payments required pursuant to
this Agreement or the Notes shall be made in immediately  available funds; shall
be  deemed  received  by the  Administrative  Agent  on the  next  Business  Day
following  receipt if such receipt is after 4:00 p.m.  Los  Angeles,  California
time, on any Business Day, and shall be made at the principal  banking  quarters
of the Administrative Agent in Monterey Park, California.

     9.19 Termination. This Agreement and the Aggregate Commitment Amount may be
canceled  by the  Borrower  without  premium  or penalty  prior to the  Facility
Termination Date upon at least thirty (30) days' prior written notice, provided,
that the  Obligations  that are then due and payable are paid and  performed  in
full to the satisfaction of the  Administrative  Agent and the Banks;  provided,
however  that  any  such   cancellation   hereunder   shall  not  terminate  any
obligations, representations or warranties of the Borrower to the Administrative
Agent and/or the Banks  hereunder  and under other Loan  Documents  that survive
beyond the Facility  Termination  Date. Upon the earlier to occur of the (i) the
Facility  Termination  Date,  and (ii)  cancellation  of this  Agreement and the
Aggregate  Commitment  Amount prior thereto in accordance with this Section 9.19
and upon payment and  performance  in full of the  Obligations  that are due and
payable to the satisfaction of the Banks, the  Administrative  Agent agrees,  at
the  Borrower's  request and sole cost and  expense,  to execute and deliver any
such lien release documents and other documentation  reasonably requested by the
Borrower to release or terminate the  Administrative  Agent's liens and security
interests hereunder and under the other Loan Documents.

     9.20  Non-Application  of Chapter 346 of Texas Finance Code. The provisions
of  Chapter  346 of the Texas  Finance  Code are  specifically  declared  by the
parties  hereto  not to be  applicable  to this  Agreement  or any of the  other
Security Instruments or to the transactions contemplated hereby.

     9.21  Counterpart  Execution.   This  Agreement  may  be  executed  as  one
instrument  signed by all parties or in separate  counterparts  hereof,  each of
which  counterparts  shall be  considered  an original and all of which shall be
deemed  to be one  instrument,  and  any  signed  counterpart  shall  be  deemed
delivered  by the  party  signing  it if  sent  to any  other  party  hereto  by
electronic facsimile transmission.

     9.22 Power of Attorney.  To the fullest  extent  permitted by Law and until
this  Agreement is terminated in accordance  with Section 9.19 hereof,  Borrower
hereby appoints Administrative Agent as its attorney-in-fact  (without requiring
the Administrative  Agent to act as such) to execute any Security  Instrument in
the name of the Borrower,  and to perform all other acts that the Administrative
Agent deems appropriate to perfect and continue its liens,  security  interests,
and other  rights in, and to protect and  preserve,  the  Collateral  Assets and
other collateral covered by or described in (or, as evidenced by this Agreement,
intended to have been covered by) any of the Security  Instruments,  but only to
the extent required of Borrower under the terms of this Agreement.

     9.23  Borrower's CRI Security  Instruments.  As provided in Section 5.01, a
substantial component of the advances made by Banks to Borrower at Closing is to
be distributed to CRI to be applied to the indebtedness  owed by CRI pursuant to
the CRI Credit  Agreement.  Accordingly,  as evidenced by an Assignment of Liens
and Security  Instruments of even date herewith from the Collateral  Agent under
the CRI Credit Agreement to the Administrative Agent hereunder,  such Collateral
Agent assigned the Borrower's CRI Security  Instruments to Administrative  Agent
to secure the  obligations  of Borrower to the Bank Parties  hereunder,  and the
Notes executed and delivered by Borrower to the Bank Parties hereunder partially
amend,  restate and rearrange the  obligations of Borrower under its guaranty of
CRI's obligations  under the CRI Credit Agreement,  which have been satisfied by
Loan advances made by the Banks hereunder.

     9.24 Confidentiality.  Each of the Bank Parties agrees to keep confidential
all non-public information provided to it by Borrower pursuant to this Agreement
that is designated  by Borrower as  confidential;  provided that nothing  herein
shall prevent any Bank Party from  disclosing  any such  information  (a) to any
Bank Party or any affiliate of any thereof,  (b) to any assignee or  prospective
assignee  that  agrees  to  comply  with  the  provisions  of  this  Section  or
substantially  equivalent  provisions,  (c) to any of its employees,  directors,
agents, attorneys,  accountants and other professional advisors, in each case on
a "need to know" basis,  (d) to any  financial  institution  that is a direct or
indirect  contractual  counterparty  in  swap  agreements  or  such  contractual
counterparty's professional advisor (so long as such contractual counterparty or
professional advisor to such contractual  counterparty agrees to be bound by the
provisions of this Section),  (e) upon the request or demand of any governmental
authority having jurisdiction over it, (f) in response to any order of any court
or other governmental  authority or as may otherwise be required pursuant to any
requirement of law, (g) in connection with any litigation or similar proceeding,
(h) that has been publicly  disclosed other than in breach of this Section,  (i)
to  the  National   Association  of  Insurance   Commissioners  or  any  similar
organization or any nationally  recognized rating agency that requires access to
information about a Bank Party's investment portfolio in connection with ratings
issued with respect to such Bank Party or (j) in connection with the exercise of
any remedy  hereunder or under any other Loan  Document;  provided that prior to
disclosure  pursuant to clauses (f) or (g) above,  the relevant Bank Party shall
(to the extent that it is lawfully  permitted to do so, as  determined  by it in
consultation  with counsel) give  reasonable  prior notice of such disclosure to
the Borrower. Notwithstanding anything herein to the contrary, any party subject
to  confidentiality  obligations  hereunder or under any other related  document
(and any employee,  representative or other agent of such party) may disclose to
any and all persons,  without  limitation of any kind, such party's U.S. federal
income tax treatment and tax structure of the transactions  contemplated by this
Agreement  relating  to such  party  and all  materials  of any kind  (including
opinions  or other tax  analyses)  that are  provided to it relating to such tax
treatment  and tax  structure.  However,  no such  party  shall be  required  to
disclose any information  relating to such tax treatment or tax structure to the
extent  nondisclosure is reasonably necessary in order to comply with applicable
securities laws. Subject to the foregoing, nothing herein shall release any Bank
Party from any other  confidentiality  agreement  previously  executed  with any
Borrower.

                            [signature pages follow]

     IN WITNESS  WHEREOF,  this Agreement is executed as of the date first above
written.

                                   BORROWER

                                   CONTINENTAL GAS, INC.

                                   By:     RANDY MOEDER
                                           Randy Moeder
                                           President

                                   ADMINISTRATIVE AGENT, LEAD
                                   ARRANGER, LC ISSUER, FRONTING
                                   BANK AND BANK:

                                   UNION BANK OF CALIFORNIA, N.A.

                                   By:     RANDALL OSTERBERG
                                           Randall Osterberg,
                                           Senior Vice President

                                   By:     JOHN CLARK
                                           John Clark,
                                           Vice President

                                   SYNDICATION AGENT,
                                   CO-ARRANGER AND BANK:

                                   FORTIS CAPITAL CORP.

                                   By:     DARRELL W. HOLLEY
                                           Darrell W. Holley,
                                           Managing Director

                                   By:     CHRISTOPHER S. PARADA
                                           Christopher S. Parada,
                                           Vice President

                                   DOCUMENTATION AGENT,
                                   CO-ARRANGER AND BANK:

                                   WELLS FARGO BANK TEXAS, N.A.

                                   By:
                                   Name:
                                   Title:
<PAGE>
                                   EXHIBIT "A"

                                COLLATERAL ASSETS

     This Exhibit A sets forth the description of the Collateral  Assets covered
by the Agreement to which this Exhibit is attached.  All of the terms defined in
the Agreement are used in this Exhibit with the same meanings given therein.

     This Exhibit and the Agreement cover and include the following:

          (a) All of Borrower's right, title and interest in and to the oil, gas
     and mineral leases  described  herein and/or lands described in and subject
     to such oil, gas and mineral leases  (regardless,  as to such leases and/or
     lands,  of any surface  acreage and/or depth  limitations  set forth in any
     description  of any of  such  oil,  gas  and  mineral  leases),  and all of
     Borrower's  right,  title and  interest  in and to any of the oil,  gas and
     minerals  in, on or under the lands,  if any,  described  on this  Exhibit,
     including,  without  limitation,  all  contractual  rights,  fee interests,
     leasehold  interests,   overriding  royalty  interests,   non-participating
     royalty interests,  mineral  interests,  production  payments,  net profits
     interests,  or any other interest  measured by or payable out of production
     of oil, gas or other  minerals from the oil, gas and mineral  leases and/or
     lands described herein; and

          (b) All of the foregoing  interests of the Borrower as such  interests
     may be enlarged by the  discharge of any payments out of  production  or by
     the removal of any charges or  encumbrances  together  with the  Borrower's
     interests  in, to and under or derived from all renewals and  extensions of
     any oil, gas and mineral leases  described  herein,  it being  specifically
     intended  hereby that any new oil and gas lease (i) in which an interest is
     acquired by the Borrower after the termination or expiration of any oil and
     gas lease,  the  interests of the Borrower in, to and under or derived from
     which are subject to the lien and security  interest hereof,  and (ii) that
     covers all or any part of the  property  described  in and  covered by such
     terminated or expired leases,  shall, to the extent, and only to the extent
     such new oil and gas lease may cover such property, be considered a renewal
     or extension of such terminated or expired lease; and

          (c) All right,  title and  interest  of  Borrower  in, to and under or
     derived from any operating,  farmout,  and bidding agreements,  assignments
     and subleases, whether or not described in this Exhibit, to the extent, and
     only to the extent,  that such  agreements,  assignments  and subleases (i)
     cover or include any of the Borrower's present right, title and interest in
     and to the leases and/or lands described in this Exhibit,  or (ii) cover or
     include any other undivided interests now or hereafter held by the Borrower
     in, to and under the  described  leases and/or  lands,  including,  without
     limitation,   any  future  operating,   farmout  and  bidding   agreements,
     assignments,   subleases  and  pooling,   unitization  and  communitization
     agreements and the units created thereby (including, without limitation all
     units formed under orders, regulations, rules or other official acts of any
     governmental body or agency having  jurisdiction) to the extent and only to
     the extent that such agreements,  assignments, subleases, or units cover or
     include the described leases and/or lands; and

          (d) All right, title, and interest of the Borrower in, to and under or
     derived from all presently existing and future advance payment  agreements,
     oil, casinghead gas and gas sales,  exchange,  and processing contracts and
     agreements  including,  without limitation,  those contracts and agreements
     that are  described on this Exhibit to the extent,  and only to the extent,
     those contracts and agreements cover or include the described leases and/or
     lands herein; and

          (e) All right,  title and interest of the Borrower in, to and under or
     derived from all  existing  and future  permits,  licenses,  easements  and
     similar rights and privileges  that relate to or are  appurtenant to any of
     the described leases and/or lands.

          Notwithstanding  the  intention of this  Agreement to cover all of the
     right, title and interest of Borrower in and to the described leases and/or
     lands,  except as expressly set forth herein Borrower  hereby  specifically
     warrants and represents that the interests  covered by this Exhibit are not
     greater than the working  interest nor less than the net revenue  interest,
     overriding  royalty  interest,  net  profit  interest,  production  payment
     interest or other  interest  payable out of or measured by  production  set
     forth in connection  with each oil and gas well  described in this Exhibit.
     In the  event  the  Borrower  owns any  other  or  greater  interest,  such
     additional  interest  shall  also  be  covered  by  and  included  in  this
     Agreement.  The designation  "Working Interest" or "W.I." means an interest
     owned in an oil, gas, and mineral lease (including  operating rights and/or
     record title  interest in oil and gas leases  issued  pursuant to the Outer
     Continental Shelf Lands Act) that determines the cost bearing percentage of
     the owner of such interest. The designation "Net Revenue Interest" or "NRI"
     means net revenue interest, or that portion of the production  attributable
     to the owner of a working interest after deduction for all royalty burdens,
     overriding  royalty  burdens,  or  other  burdens  on  production,   except
     severance,  production,  windfall  profits  and other  similar  taxes.  The
     designation  "Overriding  Royalty  Interest" or "ORRI" means an interest in
     production  which is free of any obligation for the expense of exploration,
     development and  production,  bearing only its pro rata share of severance,
     production, windfall profits and other similar taxes.

<PAGE>

                                  EXHIBIT "B-1"

                               ADVANCING TERM NOTE

[Bank's Percentage Share        Dallas, Texas                October __, 2003
of $25,000,000.00]

     On the dates hereinafter prescribed,  for value received,  CONTINENTAL GAS,
INC., an Oklahoma  corporation (herein called "Borrower"),  having an address at
205 West Maple, Suite 1100, Enid, Oklahoma 73701 promises to pay to the order of
__________________   (herein  called  "Bank"),  by  payment  to  UNION  BANK  OF
CALIFORNIA,  N.A., the  Administrative  Agent in the Credit  Agreement  (defined
below) at 1980 Saturn Drive,  Monterey Park, California 91754, (i) the principal
amount of [Bank's  percentage  share of TWENTY-FIVE  MILLION AND NO]/100 DOLLARS
([Bank's  percentage share of  $25,000,000.00]) or the principal amount advanced
pursuant to the terms of the Credit Agreement (defined herein) as of the date of
maturity  hereof,  whether by  acceleration  or otherwise,  whichever may be the
lesser,  and (ii) interest on the  principal  balance from time to time advanced
and remaining  unpaid from the date of the advance  until  maturity at a rate of
interest  equal to lesser of (a) the "Floating  Rate" (as defined and calculated
in the Credit Agreement),  or (b) the Maximum Rate (as defined and calculated in
the Credit Agreement).  Any increase or decrease in interest rate resulting from
a change in the Maximum  Rate shall be  effective  immediately  when such change
becomes  effective,  without notice to the Borrower,  unless  Applicable Law (as
defined in the Credit Agreement)  requires that such increase or decrease not be
effective  until a later time, in which event such increase or decrease shall be
effective at the earliest time permitted under the provisions of such law.

     Notwithstanding  the  foregoing,  if during any period  the  Floating  Rate
exceeds the Maximum  Rate,  the rate of interest in effect on this Note shall be
limited to the Maximum Rate during each such period, but at all times thereafter
the rate of  interest  in effect on this Note shall be the  Maximum  Rate or, if
there is no Maximum Rate, the Agreed Maximum Rate (as defined below),  until the
total  amount of  interest  accrued  on this  Note  equals  the total  amount of
interest  which would have accrued  hereon if the Floating Rate had at all times
been in effect.

     This Note is an advancing term credit note and it is  contemplated  that by
reason of prepayments  hereon there may be times when no  indebtedness  is owing
hereunder; but notwithstanding such occurrence, this Note shall remain valid and
in full force and effect as to each principal advance made hereunder  subsequent
to each such  occurrence.  Each  principal  advance and each payment hereof made
pursuant to this Note shall be reflected by the Bank's records and the aggregate
unpaid amounts reflected by such records shall constitute rebuttably presumptive
evidence of the principal and unpaid,  accrued interest remaining outstanding on
this Note.

     "Agreed  Maximum  Rate"  means a per annum rate of seven and three  fourths
percent (7.75%) plus the Floating Rate from time to time in effect, which Agreed
Maximum  Rate shall apply only during any period  while there is no Maximum Rate
applicable to this Note.

     Other capitalized terms used herein that are not defined herein, shall have
the meanings prescribed therefor in the Credit Agreement.

     The  Borrower  and the Bank  hereby  agree  that  Chapter  346 of the Texas
Finance Code, shall not apply to this Note or the loan transaction evidenced by,
and referenced  in, the Credit  Agreement  (hereinafter  defined) in any manner,
including without limitation, to any account or arrangement evidenced or created
by, or provided for in, this Note.

     The  principal  sum of  this  Note,  after  giving  credit  for  unadvanced
principal,  if any, remaining at final maturity,  shall be due and payable on or
before  September 30, 2006;  interest to accrue upon the principal sum from time
to time owing and unpaid  hereunder  shall be due and payable as provided in the
Credit Agreement; provided, however, the final installment of interest hereunder
shall be due and  payable  not later  than the  maturity  of the  principal  sum
hereof, howsoever such maturity may be brought about.

     In no event shall the  aggregate  of the  interest  on this Note,  plus any
other  amounts  paid in  connection  with the loan  evidenced by this Note which
would under Applicable Law be deemed  "interest," ever exceed the maximum amount
of interest which, under Applicable Law, could be lawfully charged on this Note.
The Bank and the Borrower  specifically  intend and agree to limit contractually
the interest  payable on this Note to not more than an amount  determined at the
Maximum Rate. Therefore, none of the terms of this Note or any other instruments
pertaining to or securing this Note shall ever be construed to create a contract
to pay  interest  at a rate in excess  of the  Maximum  Rate,  and  neither  the
Borrower nor any other party liable herefor shall ever be liable for interest in
excess of that  determined  at the  Maximum  Rate,  and the  provisions  of this
paragraph  shall  control  over  all  provisions  of this  Note or of any  other
instruments pertaining to or securing this Note. If any amount of interest taken
or  received  by the Bank shall be in excess of the  maximum  amount of interest
which,  under  Applicable  Law, could lawfully have been collected on this Note,
then the excess shall be deemed to have been the result of a mathematical  error
by the  parties  hereto and shall be  refunded  promptly  to the  Borrower.  All
amounts paid or agreed to be paid in connection with the indebtedness  evidenced
by this Note which would under Applicable Law be deemed "interest" shall, to the
extent permitted by Applicable Law, be amortized, prorated, allocated and spread
throughout the full term of this Note.

     This Note is secured by all security  agreements,  collateral  assignments,
mortgages and lien instruments  executed by the Borrower (or by any other party)
in favor of Union Bank of  California,  N.A.,  as  Administrative  Agent for the
Banks,  including  those  executed  simultaneously   herewith,   those  executed
heretofore and those hereafter executed,  and including specifically and without
limitation the Security  Instruments  described and defined in that certain Term
and  Revolving  Credit  Agreement  dated as of the date first stated above among
Borrower,   Bank  and  certain  other   financial   institutions   (the  "Credit
Agreement").

     This Note is issued pursuant to the Credit  Agreement.  Reference is hereby
made to the Credit  Agreement for a statement of the rights and  obligations  of
the  holder of this Note and the  duties  and  obligations  of the  Borrower  in
relation  thereto;  but neither this  reference to the Credit  Agreement nor any
provisions  thereof  shall  affect  or impair  the  absolute  and  unconditional
obligation of the Borrower to pay any  outstanding  and unpaid  principal of and
interest  on this Note  when due,  in  accordance  with the terms of the  Credit
Agreement.  Each advance and each  payment  made  pursuant to this Note shall be
reflected by notations made by the Bank on its records and the aggregate  unpaid
amounts  reflected  by the  notations on the records of the Bank shall be deemed
rebuttably presumptive evidence of the principal amount owing under this Note.

     In the event of default in the payment when due of any of the  principal of
or any interest on this Note,  or in the event of default under the terms of the
Credit Agreement or any of the Security  Instruments,  or if any event occurs or
condition  exists which authorizes the acceleration of the maturity of this Note
under any  agreement  made by the  Borrower,  the Bank (or other  holder of this
Note) may, at its  option,  without  presentment  or demand or any notice to the
Borrower  or any other  person  liable  herefor,  declare  the unpaid  principal
balance of and accrued interest on this Note to be immediately due and payable.

     If this Note is  collected  by suit or through  the  Probate or  Bankruptcy
Court,  or any  judicial  proceeding,  or if this Note is not paid at  maturity,
however  such  maturity may be brought  about,  and is placed in the hands of an
attorney  for  collection,  then  the  Borrower  agrees  to pay  reasonable  and
documented  attorneys'  fees,  not to exceed 10% of the full amount of principal
and  interest  owing  hereon  at the time this Note is placed in the hands of an
attorney.

     The Borrower and all sureties,  endorsers and guarantors of this Note waive
demand,  presentment  for  payment,  notice of  nonpayment,  protest,  notice of
protest,  notice of intent to accelerate  maturity,  notice of  acceleration  of
maturity, and all other notices, filing of suit and diligence in collecting this
Note or enforcing any of the security  herefor,  and agree to any  substitution,
exchange or release of any such  security or the release of any party  primarily
or  secondarily  liable hereon and further  agrees that it will not be necessary
for the  Bank,  in order  to  enforce  payment  of this  Note by them,  to first
institute  suit or exhaust its remedies  against any  Borrower or others  liable
herefor,  or to enforce its rights against any security herefor,  and consent to
any one or more extensions or  postponements  of time of payment of this Note on
any terms or any other  indulgences with respect hereto,  without notice thereof
to any of them.  The Bank may transfer this Note,  and the rights and privileges
of the  Bank  under  this  Note  shall  inure  to  the  benefit  of  the  Bank's
representatives, successors or assigns.

     [This Note amends, extends, rearranges and restates those certain [describe
each Note being replaced] (the "Prior Notes").  All liens and security interests
that exist to secure  the  indebtedness  evidenced  by that  Prior  Notes  shall
continue in force and effect to secure the indebtedness  evidenced by this Note.
(This paragraph shall be included only in replacement Notes executed pursuant to
Section 9.05(e) of the Credit Agreement).]

                            [signature page follows]

     Executed as of the date and year first set forth above.

Attest:                               CONTINENTAL GAS, INC.

                                      By:
Secretary
<PAGE>
                                  EXHIBIT "B-2"

                                 REVOLVING NOTE

[Bank's percentage               Dallas, Texas                 October __, 2003
share of $10,000,000]

     On the dates hereinafter prescribed,  for value received,  CONTINENTAL GAS,
INC., an Oklahoma  corporation (herein called "Borrower"),  having an address at
205 West Maple, Suite 1100, Enid,  Oklahoma 73701,  promises to pay to the order
of  _____________________  (herein called  "Bank"),  by payment to UNION BANK OF
CALIFORNIA,  N.A., the  Administrative  Agent in the Credit  Agreement  (defined
below) at 1980 Saturn Drive,  Monterey Park,  California 91754 (i) the principal
amount  of U.S.  [Bank's  percentage  share  of TEN  MILLION]  DOLLARS  ([Bank's
percentage share of  $10,000,000]) or the principal amount advanced  pursuant to
the terms of the Credit  Agreement  (defined  herein) as of the date of maturity
hereof,  whether by acceleration or otherwise,  whichever may be the lesser, and
(ii) interest on the principal  balance from time to time advanced and remaining
unpaid from the date of the advance until  maturity at a rate of interest  equal
to lesser of (a) the  "Floating  Rate" (as defined and  calculated in the Credit
Agreement),  or (b) the Maximum  Rate (as defined and  calculated  in the Credit
Agreement). Any increase or decrease in interest rate resulting from a change in
the  Maximum  Rate  shall be  effective  immediately  when such  change  becomes
effective,  without notice to the Borrower, unless Applicable Law (as defined in
the Credit  Agreement)  requires that such increase or decrease not be effective
until a later time, in which event such increase or decrease  shall be effective
at the earliest time permitted under the provisions of such law.

     Notwithstanding  the  foregoing,  if during any period  the  Floating  Rate
exceeds the Maximum  Rate,  the rate of interest in effect on this Note shall be
limited to the Maximum Rate during each such period, but at all times thereafter
the rate of  interest  in effect on this Note shall be the  Maximum  Rate or, if
there is no Maximum Rate, the Agreed Maximum Rate (as defined below),  until the
total  amount of  interest  accrued  on this  Note  equals  the total  amount of
interest  which would have accrued  hereon if the Floating Rate had at all times
been in effect.

     This Note is a revolving credit note and it is contemplated  that by reason
of  prepayments  hereon  there  may be  times  when  no  indebtedness  is  owing
hereunder; but notwithstanding such occurrence, this Note shall remain valid and
in full force and effect as to each principal advance made hereunder  subsequent
to each such  occurrence.  Each  principal  advance and each payment hereof made
pursuant to this Note shall be reflected by the Bank's records and the aggregate
unpaid amounts reflected by such records shall constitute rebuttably presumptive
evidence of the principal and unpaid,  accrued interest remaining outstanding on
this Note.

     "Agreed  Maximum  Rate"  means a per annum rate of seven and  three-fourths
percent (7.75%) plus the Floating Rate from time to time in effect, which Agreed
Maximum  Rate shall apply only during any period  while there is no Maximum Rate
applicable to this Note.

     Other  capitalized  terms used herein,  that are not defined herein,  shall
have the meanings prescribed therefor in the Credit Agreement.

     The  Borrower  and the Bank  hereby  agree  that  Chapter  346 of the Texas
Finance Code, shall not apply to this Note or the loan transaction evidenced by,
and referenced  in, the Credit  Agreement  (hereinafter  defined) in any manner,
including without limitation, to any account or arrangement evidenced or created
by, or provided for in, this Note.

     The  principal  sum of  this  Note,  after  giving  credit  for  unadvanced
principal,  if any, remaining at final maturity,  shall be due and payable on or
before  September 30, 2006;  interest to accrue upon the principal sum from time
to time owing and unpaid  hereunder  shall be due and payable as provided in the
Credit Agreement; provided, however, the final installment of interest hereunder
shall be due and  payable  not later  than the  maturity  of the  principal  sum
hereof, howsoever such maturity may be brought about.

     In no event shall the  aggregate  of the  interest  on this Note,  plus any
other  amounts  paid in  connection  with the loan  evidenced by this Note which
would under Applicable Law be deemed  "interest," ever exceed the maximum amount
of interest which, under Applicable Law, could be lawfully charged on this Note.
The Bank and the Borrower  specifically  intend and agree to limit contractually
the interest  payable on this Note to not more than an amount  determined at the
Maximum Rate. Therefore, none of the terms of this Note or any other instruments
pertaining to or securing this Note shall ever be construed to create a contract
to pay  interest  at a rate in excess  of the  Maximum  Rate,  and  neither  the
Borrower nor any other party liable herefor shall ever be liable for interest in
excess of that  determined  at the  Maximum  Rate,  and the  provisions  of this
paragraph  shall  control  over  all  provisions  of this  Note or of any  other
instruments pertaining to or securing this Note. If any amount of interest taken
or  received  by the Bank shall be in excess of the  maximum  amount of interest
which,  under  Applicable  Law, could lawfully have been collected on this Note,
then the excess shall be deemed to have been the result of a mathematical  error
by the  parties  hereto and shall be  refunded  promptly  to the  Borrower.  All
amounts paid or agreed to be paid in connection with the indebtedness  evidenced
by this Note which would under Applicable Law be deemed "interest" shall, to the
extent permitted by Applicable Law, be amortized, prorated, allocated and spread
throughout the full term of this Note.

     This Note is secured by all security  agreements,  collateral  assignments,
mortgages and lien instruments  executed by the Borrower (or by any other party)
in favor of Union Bank of  California,  N.A.,  as  Administrative  Agent for the
Banks,  including  those  executed  simultaneously   herewith,   those  executed
heretofore and those hereafter executed,  and including specifically and without
limitation the Security  Instruments  described and defined in that certain Term
and  Revolving  Credit  Agreement  dated as of the date first stated above among
Borrower,   Bank  and  certain  other   financial   institutions   (the  "Credit
Agreement").

     This Note is issued pursuant to the Credit  Agreement.  Reference is hereby
made to the Credit  Agreement for a statement of the rights and  obligations  of
the  holder of this Note and the  duties  and  obligations  of the  Borrower  in
relation  thereto;  but neither this  reference to the Credit  Agreement nor any
provisions  thereof  shall  affect  or impair  the  absolute  and  unconditional
obligation of the Borrower to pay any  outstanding  and unpaid  principal of and
interest  on this Note  when due,  in  accordance  with the terms of the  Credit
Agreement.  Each advance and each  payment  made  pursuant to this Note shall be
reflected by notations made by the Bank on its records and the aggregate  unpaid
amounts  reflected  by the  notations on the records of the Bank shall be deemed
rebuttably presumptive evidence of the principal amount owing under this Note.

     In the event of default in the payment when due of any of the  principal of
or any interest on this Note,  or in the event of default under the terms of the
Credit Agreement or any of the Security  Instruments,  or if any event occurs or
condition  exists which authorizes the acceleration of the maturity of this Note
under any  agreement  made by the  Borrower,  the Bank (or other  holder of this
Note) may, at its  option,  without  presentment  or demand or any notice to the
Borrower  or any other  person  liable  herefor,  declare  the unpaid  principal
balance of and accrued interest on this Note to be immediately due and payable.

     If this Note is  collected  by suit or through  the  Probate or  Bankruptcy
Court,  or any  judicial  proceeding,  or if this Note is not paid at  maturity,
however  such  maturity may be brought  about,  and is placed in the hands of an
attorney  for  collection,  then  the  Borrower  agrees  to pay  reasonable  and
documented  attorneys'  fees,  not to exceed 10% of the full amount of principal
and  interest  owing  hereon  at the time this Note is placed in the hands of an
attorney.

     The Borrower and all sureties,  endorsers and guarantors of this Note waive
demand,  presentment  for  payment,  notice of  nonpayment,  protest,  notice of
protest,  notice of intent to accelerate  maturity,  notice of  acceleration  of
maturity, and all other notices, filing of suit and diligence in collecting this
Note or enforcing any of the security  herefor,  and agree to any  substitution,
exchange or release of any such  security or the release of any party  primarily
or  secondarily  liable hereon and further  agrees that it will not be necessary
for the  Bank,  in order  to  enforce  payment  of this  Note by them,  to first
institute  suit or exhaust its remedies  against any  Borrower or others  liable
herefor,  or to enforce its rights against any security herefor,  and consent to
any one or more extensions or  postponements  of time of payment of this Note on
any terms or any other  indulgences with respect hereto,  without notice thereof
to any of them.  The Bank may transfer this Note,  and the rights and privileges
of the  Bank  under  this  Note  shall  inure  to  the  benefit  of  the  Bank's
representatives, successors or assigns.

     [This Note amends, extends, rearranges and restates those certain [describe
each Note being replaced] (the "Prior Notes").  All liens and security interests
that exist to secure  the  indebtedness  evidenced  by that  Prior  Notes  shall
continue in force and effect to secure the indebtedness  evidenced by this Note.
(This paragraph shall be included only in replacement Notes executed pursuant to
Section 9.05(e) of the Credit Agreement).]

                            [signature page follows]

     Executed as of the date and year first set forth above.

                                   CONTINENTAL GAS, INC.
Attest:

                                   By:

Secretary
<PAGE>

                                   EXHIBIT "C"

                             COMPLIANCE CERTIFICATE

     I, the President of  CONTINENTAL  GAS, INC.  (the  "Company"),  pursuant to
Section 5.05 of the Revolving Credit Agreement dated as of October ___, 2003, by
and among the Company, UNION BANK OF CALIFORNIA,  N.A., as Administrative Agent,
and the other Banks that are party thereto (the  "Agreement") do hereby certify,
as of the date hereof, that to my knowledge:

     (a)  No Event of Default (as defined in the  Agreement) has occurred and is
          continuing,  and no  Unmatured  Event of  Default  (as  defined in the
          Agreement)  has occurred and is  continuing  except for the  following
          events (include actions taken to cure such situations):

     (b)  No Material  Adverse  Change has occurred  since the effective date of
          the latest audited  consolidated  Financial  Statements of the Company
          delivered to the Administrative Agent;

     (c)  Except as otherwise stated in the Schedule,  if any,  attached hereto,
          each of the representations and warranties of the Company contained in
          Article IV of the Agreement is true and correct in all respects; and

     (d)  The Company's  consolidated financial condition for the quarter ending
          __________ is as follows:

<TABLE>
<CAPTION>
                                                                            Required Ratio or       Actual Ratio or
                 Financial Covenant             Date or Time Period              Amount                  Amount
          =================================   =========================   ======================   =================
<S>       <C>                                 <C>                         <C>                          <C>
(a)       Current Ratio                       As of the end of each       is not less than
          (Current Assets to Current          fiscal quarter              1.0 to 1.0                   __________
          Liabilities)

(b)       Fixed Interest Coverage Ratio       As of the end of each       is not less than
          (EBITDA to Total Interest           fiscal quarter, during      3.00 to 1.0                  __________
          Charges)                            the preceding four
                                              quarters

(c)       Fixed Charge Coverage Ratio         As of the end of each       is not less than
                                              fiscal quarter, during      1.50 to 1.0                  __________
                                              the preceding four
                                              quarters

(d)       Senior Debt to EBITDA               As of the end of each       is not greater than
                                              fiscal quarter              3.50 to 1.0 from             __________
                                                                          Closing through
                                                                          9/30/04; 3.25 to 1.0
                                                                          from 10/1/04 through
                                                                          3/31/05; and 3.00 to
                                                                          1.00 thereafter
</TABLE>

     This certificate is executed this _____ day of_________,_____.

                                       CONTINENTAL GAS, INC.

                                       By:
                                             ______________________, President

<PAGE>
                                   EXHIBIT "D"

                              SECURITY INSTRUMENTS

     The  Security   Instruments   securing  the  Borrower's   Obligations   and
Indebtedness to the Bank shall include the following, each in form and substance
satisfactory to the Bank:

     1. DEED(S) OF TRUST, SECURITY AGREEMENT, FINANCING STATEMENT AND ASSIGNMENT
OF PRODUCTION  covering all of Borrower's  Oil and Gas  Properties  and Pipeline
Properties situated in Oklahoma,  North Dakota, and all other applicable states,
the personal property and equipment therein and thereon,  the production of oil,
gas, and other minerals therefore, and all of the products and proceeds thereof,
to be duly executed by Borrower with respect to all of the Collateral Assets.

     2. SECURITY AGREEMENT  granting the  Administrative  Agent a first priority
security  interest  in all of the  Borrower's  and its  Subsidiaries'  accounts,
equipment, machinery, fixtures, inventory, chattel paper, documents, instruments
and general intangibles relating to or arising out of the Collateral Assets, and
the business of the Borrower,  whether now owned or hereafter acquired,  and all
products and proceeds thereof.

     3.  FINANCING  STATEMENTS  in  connection  with  the  Security  Instruments
described in the preceding  paragraphs,  in form and number  satisfactory to the
Administrative  Agent as the  Administrative  Agent,  from to time,  may specify
(including additional or supplemental financing statements,  amendments thereto,
and continuation statements thereof).

     4. OTHER SECURITY  INSTRUMENTS.  Such other instruments as are necessary or
appropriate  from time to time, in the good faith opinion of the  Administrative
Agent, to perfect to the  satisfaction of the  Administrative  Agent, its liens,
security interests, and other rights in the Collateral Assets and in any and all
other collateral  covered by or described in (or, as evidenced by the Agreement,
intended  to  have  been  covered  by)  any of the  other  Security  Instruments
described above.
<PAGE>

                                   EXHIBIT "E"

                               REQUEST FOR ADVANCE

     I, the  undersigned  officer of  CONTINENTAL  GAS,  INC.  (the  "Company"),
pursuant to Section 2.01 of the Revolving  Credit  Agreement dated as of October
___, 2003, as amended from time to time (the "Agreement"),  by and between UNION
BANK OF CALIFORNIA, N.A. ("Administrative Agent"), the banks and other financial
institutions  from time to time parties to the Agreement (the "Banks"),  and the
Company, do hereby make the requests indicated below on this day of , 200 :

o        1.   Loans:

(a)      Amount of new Loan: $

(b)      Requested funding date:        , 200

(c)      $              of such Loan is to be an RR Loan;

         $              of such Loan is to be a LIBOR Loan.

         Requested Interest Period for LIBOR Loan:     months.

o        2.   Continuation or conversion of LIBOR Loan maturing
                  on        , 200  :

(a)      Amount to be continued as a LIBOR Loan is $              , with
         an Interest Period of       months;

(b)      Amount to be converted to an RR Loan is $              .

o        3.   Conversion of RR Loan:

(a)      Requested conversion date:           , 200    .

(b)      Amount to be converted to a LIBOR Loan is $           , with
         an Interest Period of      months.

          4.   The undersigned  certifies that the funds advanced from the Banks
               to the Company  pursuant  to  paragraphs  1 through 3 hereof,  as
               applicable,  shall be used by the Company solely for the purposes
               permitted by the Agreement.

          5.   The undersigned  certifies that to my knowledge after  reasonable
               inquiry into the  applicable  facts,  as of the date hereof,  the
               Company  is  in  compliance  with  all  of  the  representations,
               warranties,  terms,  conditions  and  covenants  contained in the
               Agreement  and no Event of Default or Unmatured  Event of Default
               has occurred and is continuing under the Agreement.

          6.   The undersigned  certifies that to my knowledge after  reasonable
               inquiry into the  applicable  facts,  as of the date  hereof,  no
               Material  Adverse Change has occurred since the effective date of
               the latest audited Financial  Statements of the Company delivered
               to the Administrative Agent;

     This certificate is executed this ____ day of ___________, 200 .

                                     CONTINENTAL GAS, INC.

                                     By:
<PAGE>
                                   EXHIBIT "F"

                         AVAILABILITY AMOUNT CERTIFICATE

         Availability Amount Certificate as of _______________, 200____

     Reference is made to that certain Term and Revolving Credit Agreement dated
as of  October  22,  2003 (as the same may be  amended,  restated  or  otherwise
modified from time to time, the "Credit  Agreement") among Continental Gas, Inc.
(the  "Borrower"),  each of the financial  institutions  from time to time party
thereto (the  "Banks") and Union Bank of  California,  N.A.,  as  administrative
agent for the Banks (the "Administrative Agent").  Capitalized terms used herein
and not otherwise  defined herein shall have the meanings assigned to such terms
in the Credit Agreement.

     Pursuant to Section  2.06(b) of the Credit  Agreement,  the Borrower hereby
certifies to the Administrative  Agent and the Banks as follows as of _________,
200_:

1.   Revolving Loan  Availability  Amount value of Eligible  Receivables  (80%):
     (See   Schedule  1  attached   hereto  for   supporting   information.)
                                                                  $_____________

2.   Revolving Loan Availability Amount value of Inventory (50%): $_____________
     (See Schedule 2 attached hereto for supporting information.)

3.   TOTAL REVOLVING LOAN AVAILABILITY AMOUNT:                    $_____________
         (The sum of item 1 plus item 2.)

4.   LESSER OF TOTAL REVOLVING LOAN AVAILABILITY AMOUNT OR $5,000,000.00:
                                                                  $_____________

5.   Aggregate principal amount of all outstanding Revolving Loans:
                                                                  $_____________

6.   Aggregate amount of all LC Obligations:                      $_____________

7.   REVOLVING LOAN AVAILABILITY AMOUNT AVAILABILITY:             $_____________
     (Remainder of (a) item 4 minus (b) the sum of item 5
     plus item 6.)

     The Borrower has caused this Availability Amount Certificate to be executed
this ___ day of ___________, 200_.

                                       Continental Gas, Inc.

                                       By:
                                       Name:
                                       Title:
<PAGE>
                                   SCHEDULE 1

                                       to

                         Availability Amount Certificate

                           dated as of _________, ____

             [Supporting information regarding Eligible Receivables]
<PAGE>
                                   SCHEDULE 2

                                       to
                         Availability Amount Certificate

                           dated as of _________, ____

            [Appropriate supporting information regarding Inventory]

<PAGE>

                                Schedule 1.01(b)

               Commitment Amounts and Aggregate Commitment Amount

             Bank                        Percentage               Commitment
                                           Share                    Amount
    Union Bank of California, N.A.       33.3333334%            $11,666,666.67
    Wells Fargo Bank Texas, N.A.         33.3333333%            $11,666,666.66
    Fortis Capital Corp.                 33.3333333%            $11,666,666.66
                                                                --------------
    Aggregate Commitment Amount:                                $35,000,000.00
<PAGE>

                                Schedule 2.20(C)

                           Fax Numbers for all Parties

Union Bank of California, N.A..................................214-922-4209

Wells Fargo Bank Texas, N.A. ..................................214-661-1242

Fortis Capital Corp............................................214-754-5982

Continental Gas, Inc...........................................580-548-5188
<PAGE>
                         COMMITMENT TRANSFER SUPPLEMENT

     THIS COMMITMENT TRANSFER SUPPLEMENT (this "Commitment Transfer Supplement")
dated as of the date set  forth in Item 1 of  Schedule  I  hereto,  is among the
Transferor  Bank set  forth in Item 2 of  Schedule  I  hereto  (the  "Transferor
Bank"),  each  Purchasing  Bank  set  forth  in  Item 3 of  Schedule  1  (each a
"Purchasing Bank"), and UNION BANK OF CALIFORNIA,  N.A., as Administrative Agent
for the Banks under, and as defined in, the Credit Agreement described below (in
such capacity, the "Administrative Agent").

                                    RECITALS

     WHEREAS,   this  Commitment  Transfer  Supplement  is  being  executed  and
delivered in accordance with Section 9.05(c) of the Revolving  Credit  Agreement
dated as of October ___, 2003, by and among  CONTINENTAL  GAS, INC., an Oklahoma
corporation and certain of its Affiliates ("Borrower"),  the Transferor Bank and
the other Banks party thereto and the Administrative Agent (as from time to time
amended,  supplemented  or  otherwise  modified  in  accordance  with the  terms
thereof,  the "Credit  Agreement";  terms  defined  therein being used herein as
therein defined);

     WHEREAS,  each  Purchasing  Bank (if it is not  already a Bank party to the
Credit Agreement) wishes to become a Bank party to the Credit Agreement; and

     WHEREAS,  the Transferor  Bank is selling and assigning to each  Purchasing
Bank, rights, obligations and commitments under the Credit Agreement;

     NOW, THEREFORE, the parties hereto agree as follows:

                                  GENERAL TERMS

     Section 1. Upon receipt by the Administrative Agent of five counterparts of
this  Commitment  Transfer  Supplement,  to each of  which is  attached  a fully
completed Schedule I and Schedule II, and each of which has been executed by the
Transferor  Bank,  each  Purchasing  Bank (and any other person  required by the
Credit  Agreement  to  execute  this  Commitment   Transfer   Supplement),   the
Administrative Agent will transmit to the Borrower, the Transferor Bank and each
Purchasing  Bank a  Transfer  Effective  Notice,  substantially  in the  form of
Schedule III to this  Commitment  Transfer  Supplement  (a  "Transfer  Effective
Notice").  Such Transfer  Effective Notice shall set forth, inter alia, the date
on which the transfer  effected by this  Commitment  Transfer  Supplement  shall
become effective (the "Transfer  Effective Date"),  which date shall be at least
five (5) Business Days  following the date of such  Transfer  Effective  Notice.
From and after the Transfer  Effective Date each Purchasing Bank shall be a Bank
party to the Credit Agreement for all purposes thereof.

     Section 2. At or before 12:00 Noon,  local time of the Transferor  Bank, on
the Transfer  Effective  Date,  each Purchasing Bank shall pay to the Transferor
Bank, in immediately  available funds, an amount equal to the purchase price, as
agreed  between the  Transferor  Bank and such  Purchasing  Bank (the  "Purchase
Price"), of the portion being purchased by such Purchasing Bank (such Purchasing
Bank's  "Purchased  Percentage") of the outstanding  Credit Extensions and other
amounts owing to the Transferor  Bank under the Credit  Agreement and the Notes.
Effective  upon  receipt by the  Transferor  Bank of the  Purchase  Price from a
Purchasing  Bank,  the Transferor  Bank hereby  irrevocably  sells,  assigns and
transfers to such Purchasing Bank, without recourse, representation or warranty,
and each Purchasing Bank hereby  irrevocably  purchases,  takes and assumes from
the  Transferor  Bank,  such  Purchasing  Bank's  Purchased  Percentage  of  the
Commitment  of  the  Transferor  Bank  and  the  presently   outstanding  Credit
Extensions  and other  amounts  owing to the  Transferor  Bank  under the Credit
Agreement and the Notes together with all instruments,  documents and collateral
security pertaining thereto.

     Section 3. The Transferor Bank has made  arrangements  with each Purchasing
Bank with respect to (a) the portion,  if any, to be paid, and the date or dates
for  payment,  by the  Transferor  Bank to  such  Purchasing  Bank  of any  fees
heretofore  received by the  Transferor  Bank  pursuant to the Credit  Agreement
prior to the Transfer  Effective Date, and (b) the portion,  if any, to be paid,
and the date or dates for payment,  by such  Purchasing  Bank to the  Transferor
Bank of fees or interest received by such Purchasing Bank pursuant to the Credit
Agreement from and after the Transfer Effective Date.

     Section 4. (a) All principal  payments that would otherwise be payable from
and after the Transfer  Effective  Date to or for the account of the  Transferor
Bank pursuant to the Credit Agreement and the Notes shall,  instead,  be payable
to or for the account of the Transferor  Bank and the Purchasing  Banks,  as the
case may be, in accordance with their respective  interests as reflected in this
Commitment Transfer Supplement.

     (b) All interest,  fees and other amounts that would  otherwise  accrue for
the account of the  Transferor  Bank from and after the Transfer  Effective Date
pursuant to the Credit  Agreement and the Notes shall,  instead,  accrue for the
account of, and be payable to, the Transferor Bank and the Purchasing  Banks, as
the case may be, in accordance with their  respective  interests as reflected in
this Commitment Transfer Supplement.

     (c) In the  event  that any  amount  of  interest,  fees or  other  amounts
accruing prior to the Transfer Effective Date was included in the Purchase Price
paid by any Purchasing  Bank, the Transferor  Bank and each Purchasing Bank will
make  appropriate  arrangements  for  payment  by the  Transferor  Bank  to such
Purchasing Bank of such amount upon receipt thereof from the Borrower.

     Section 5. On or prior to the Transfer  Effective Date, the Transferor Bank
will deliver to the Administrative Agent its Note. Within five (5) Business Days
after Borrower's receipt of notice from  Administrative  Agent of Administrative
Agent's  receipt of this  Commitment  Transfer  Supplement,  the  Borrower  will
deliver to the  Administrative  Agent, in exchange for the surrendered Note from
the  Transferor  Bank, a new Note for each  Purchasing  Bank and the  Transferor
Bank, to the extent the Transferor Bank has retained any of its  Commitment,  in
each  case in  principal  amounts  reflecting,  in  accordance  with the  Credit
Agreement,  their respective  Commitment  Amounts (as adjusted  pursuant to this
Commitment  Transfer  Supplement).  As provided in Section 9.05(e) of the Credit
Agreement,  each  such new Note  shall be dated  the date of the  original  Note
delivered  pursuant to the Credit  Agreement (the  "Effective  Date").  Promptly
after the Transfer Effective Date, the Administrative Agent will send to each of
the Transferor  Bank and the Purchasing  Banks its new Note and will send to the
Borrower the  superseded  Note of the  Transferor  Bank,  marked  "Canceled"  or
"Replaced" as appropriate.

     Section  6.  Concurrently  with the  execution  and  delivery  hereof,  the
Transferor  Bank will  provide to each  Purchasing  Bank (if it is not already a
Bank party to the Credit  Agreement)  conformed  copies of all  documents in the
Transferor Bank's possession that were delivered to the Administrative  Agent on
the Effective Date in satisfaction of the conditions  precedent set forth in the
Credit Agreement.

     Section  7. Each of the  parties  to this  Commitment  Transfer  Supplement
agrees  that at any time and from time to time upon the  written  request of any
other party,  it will execute and deliver  such  further  documents  and do such
further acts and things as such other party may  reasonably  request in order to
effect the purposes of this Commitment Transfer Supplement.

     Section 8. By executing and delivering this Commitment Transfer Supplement,
the  Transferor  Bank and each  Purchasing  Bank  confirm to and agree with each
other and the Administrative  Agent and the Banks as follows: (i) other than the
representation  and warranty  that it is the legal and  beneficial  owner of the
interest  being  assigned  hereby  free and  clear  of any  adverse  claim,  the
Transferor   Bank  makes  no   representation   or   warranty   and  assumes  no
responsibility  with respect to any  statements,  warranties or  representations
made in or in connection with the Credit  Agreement or the execution,  legality,
validity,  enforceability,  genuineness,  sufficiency  or  value  of the  Credit
Agreement,  the  Notes,  any other  Loan  Document  or any other  instrument  or
document  furnished  pursuant  thereto;   (ii)  the  Transferor  Bank  makes  no
representation  or warranty  and assumes no  responsibility  with respect to the
financial  condition  of the  Borrower,  any  Subsidiary  of the Borrower or the
performance  or observance by the Borrower or any  Subsidiary of the Borrower of
any of their respective  obligations under the Credit Agreement,  the Notes, any
other Loan  Document  or any other  instrument  or document  furnished  pursuant
hereto;  (iii) each  Purchasing Bank confirms that it has received a copy of the
Credit Agreement,  together with copies of the Financial  Statements referred to
in Section 3.1(D), the Financial  Statements delivered pursuant to Sections 5.03
and 5.04,  if any, and such other  documents  and  information  as it has deemed
appropriate  to make its own credit  analysis  and  decision  to enter into this
Commitment Transfer  Supplement;  (iv) each Purchasing Bank will,  independently
and without reliance upon the  Administrative  Agent, the Transferor Bank or any
other  Bank and  based  on such  documents  and  information  as it  shall  deem
appropriate at the time,  continue to make its own credit decisions in taking or
not taking action under the Credit Agreement;  (v) each Purchasing Bank appoints
and authorizes the  Administrative  Agent to take such action as  Administrative
Agent on its behalf and to exercise  such powers  under the Credit  Agreement as
are delegated to the  Administrative  Agent by the terms thereof,  together with
such powers as are reasonably incidental thereto, all in accordance with Article
VIII of the Credit Agreement;  and (vi) each Purchasing Bank agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of the Credit Agreement are required to be performed by it as a Bank.

     Section 9. Each party hereto represents and warrants to and agrees with the
Administrative  Agent that it is aware of and will comply with the  provision of
Section 2.16 of the Credit Agreement.

     Section 10.  Schedule II hereto sets forth the revised  Commitment  Amounts
and Percentage Shares of the Transferor Bank and each Purchasing Bank as well as
administrative information with respect to each Purchasing Bank.

     Section 11. THIS COMMITMENT  TRANSFER  SUPPLEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.

     IN WITNESS WHEREOF, the parties hereto have caused this Commitment Transfer
Supplement  to be  executed  by their  respective  duly  authorized  officers on
Schedule I hereto as of the date set forth in Item I of Schedule I hereto.
<PAGE>
                                                                   Schedule I to
                                                  Commitment Transfer Supplement

                          COMPLETION OF INFORMATION AND
                            SIGNATURES FOR COMMITMENT
                               TRANSFER SUPPLEMENT

          Re:  Revolving  Credit  Agreement dated as of October ___, 2003, among
               CONTINENTAL GAS, Inc., and certain of its Affiliates,  the Banks,
               and Union Bank of California,  N.A., as Administrative  Agent for
               the Banks thereunder.
<TABLE>
<S>     <C>                           <C>
Item 1  (Date of Commitment Transfer
        Supplement):                  [Insert date of Commitment Transfer Supplement]

Item 2  (Transferor Bank):            [Insert name of Transferor Bank]

Item 3  (Purchasing Bank[s]):         [Insert name[s] of Purchasing Bank[s]]

Item 4  (Signatures of Parties
        to Commitment Transfer
        Supplement):                  ____________________________, as Transferor Bank
</TABLE>

                                      By:
                                      Title:

                                                   , as Purchasing Bank

                                      By:
                                      Title:

                                                   , as Purchasing Bank

                                      By:
                                      Title:

CONSENTED TO AND ACKNOWLEDGED:

CONTINENTAL GAS, INC.

By:
Name:
Title:

UNION BANK OF CALIFORNIA, N.A.
as Administrative Agent

By:
Name:
Title:

[Consents Required only when
Purchasing Bank is not already
a Bank or Affiliate thereof]

ACCEPTED FOR RECORDATION
IN REGISTER:

UNION BANK OF CALIFORNIA, N.A.
as Administrative Agent

By:
Title:
<PAGE>
                                                                  Schedule II to
                                                  Commitment Transfer Supplement

                       LIST OF LENDING OFFICES, ADDRESSES
                       FOR NOTICES AND COMMITMENT AMOUNTS

[Name of Transferor Bank]
                           Revised Commitment Amount:           $

                           Revised Commitment Percentage:

[Name of Purchasing Bank]
                           New Commitment Amount:               $

                           New Commitment Percentage:

Address for Notices:

[address]

Attention:
Telex:
Answer back:
Telephone:
Telecopier:

Lending Office:
<PAGE>
                       [Form of Transfer Effective Notice]

                                                                Schedule III to
                                                  Commitment Transfer Supplement

          To:  [Insert Name of  Borrower,  Transferor  Bank and each  Purchasing
               Bank]

     The  undersigned,  as  Administrative  Agent  under  the  Revolving  Credit
Agreement  dated  as  of  October  __,  2003,   among   CONTINENTAL   GAS,  INC.
("Borrower"),  the  Banks  and other  financial  institutions  from time to time
parties  thereto and Union Bank of  California,  N.A. as  Administrative  Agent,
acknowledges  receipt of five executed  counterparts  of a completed  Commitment
Transfer  Supplement,  as described in Schedule I hereto.  [Note: attach copy of
Schedule  I  from  Commitment  Transfer   Supplement.]  Terms  defined  in  such
Commitment Transfer Supplement are used herein as therein defined.

          1. Pursuant to such Commitment  Transfer  Supplement,  you are advised
     that the  Transfer  Effective  Date  will be  [Insert  fifth  Business  Day
     following date of Transfer Effective Notice].

          2. Pursuant to such  Commitment  Transfer  Supplement,  the Transferor
     Bank is  required  to deliver  its Note to the  Administrative  Agent on or
     before the Transfer Effective Date.

          3. Pursuant to such Commitment  Transfer  Supplement,  the Borrower is
     required  to  deliver  to the  Administrative  Agent on or before the fifth
     (5th) Business Day from its receipt of this notice,  in return for the Note
     surrendered  to the  Administrative  Agent  by  the  Transferor  Bank,  the
     following Notes [Describe each Note for Transferor Bank and Purchasing Bank
     as to principal amount and payee], dated October __, 2003.

          4. Pursuant to such  Commitment  Transfer  Supplement  each Purchasing
     Bank is required to pay its  Purchase  Price to the  Transferor  Bank at or
     before 12:00 Noon on the Transfer  Effective Date in immediately  available
     funds.

                                      Very truly yours,

                                      UNION BANK OF CALIFORNIA, N.A.,
                                      as Administrative Agent

                                      By:
                                      Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00057-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00057-of-00352.parquet"}]]