TEXSTAR PETROLEUM, INC.
BENZ ENERGY LTD.
CALIBRE ENERGY, L.L.C.
November 4, 1998
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
1100 Louisiana Street, Suite 3150
Houston, Texas 77002
Gentlemen:
In this letter the following terms have the following definitions:
"Bank One" means Bank One, Texas, National Association.
"Bank One Credit Facility" means the loan facility extended by Bank
One to Borrower under the Bank One Loan Agreement.
"Bank One Loan Agreement" means that certain Loan Agreement dated
as of July 17, 1997, between Borrower and Bank One, as from time to time
amended or supplemented (including without limitation, as amended
concurrently herewith).
"Benz" means Benz Energy Ltd., a corporation existing under the
laws of the Yukon Territory, Canada.
"Benz Entities" means Borrower, the Guarantors/Shareholders, and
all of their respective past or present shareholders, members, partners,
officers, directors, employees, attorneys, agents, representatives,
subsidiaries, parents, investors, participants, successors, assigns, and
affiliates or associated entities of whatever kind.
"BOCP" means BOCP Energy Partners, L.P.
"Borrower" means Texstar Petroleum, Inc., a Texas corporation.
"Calibre" means Calibre Energy, L.L.C., a Texas limited liability
company.
"Collateral" means all collateral or security given by Borrower or
any Guarantor/Shareholder under any of the Loan Documents to secure the
payment or performance of any indebtedness or obligations owing by
Borrower or any Guarantor/Shareholder under any of the Loan Documents.
"EnCap III LP" means EnCap Energy Capital Fund III, L.P.
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 2
"EnCap Credit Agreement" means that certain Credit Agreement made
as of October 9, 1997, as from time to time amended or supplemented, by
and among Borrower, as borrower, Benz and Calibre, as guarantors, and
EnCap III LP, as lender.
"Guarantors/Shareholders" means Benz, Calibre, Benz Properties
Ltd., Prentis B. Tomlinson, Jr., individually, Texstar Holdings, L..L.C.
(f/ka Texstar Petroleum, L.L.C.), Prentis B. Tomlinson, Jr., Trustee of
and on behalf of The Slattery Trust, Prentis B. Tomlinson, Jr., Trustee
of and on behalf of The Ruston Trust, Prentis B. Tomlinson, Jr., Trustee
of and on behalf of The Houston Trust and Heather J. Tomlinson, Trustee
of and on behalf of The Starbucks Trust.
"Investor Entities" means BOCP, EnCap III LP, Bank One, and all of
their respective past or present members, partners, shareholders,
officers, directors, employees, attorneys, agents, representatives,
subsidiaries, parents, investors, participants, successors, assigns, and
affiliates or associated entities of whatever kind.
"Loan Documents" means all "Loan Documents" as defined in the EnCap
Credit Agreements, all "Loan Documents" as defined in the Bank One Loan
Agreement, and all other documents or instruments at any time given or
entered into by Borrower or any Guarantor/Shareholder in connection with
any of the foregoing.
"Oakvale Success" means the occurrence of all of the following: (a)
one or both of the Oakvale Wells is drilled to the base of the H-6 sand
in the Hosston formation, (b) either or both of the Oakvale Wells so
drilled is completed as a producer in one or more new zones not
currently being produced from Borrower's Byrd No. 1 Well, and (c) Ryder
Scott Company assigns at least 9.5 billion cubic feet of new proved
producing reserves of natural gas to Borrower's net revenue interests in
either (or both, collectively) of such completed Oakvale Wells.
"Oakvale Wells" means (a) Borrower's well named the "Howell
Petroleum 32-4 No. 1" that, as of October 26, 1998, is being drilled on
Borrower's Howell Petroleum Co. lease in Jefferson Davis County,
Mississippi, and (b) Borrower's well named the "Fortenberry 32-13 No. 1"
that, as of October 26, 1998, is being drilled on Borrower's Fortenberry
lease in Jefferson Davis County, Mississippi.
"Released Claims" means any and all claims, demands, and causes of
action of whatever kind or character which any Benz Entity has, or may
have in the future, based on any actions, failures to act, or events
that have occurred prior to the effective date hereof, which in any way
relate to or are based upon any of the following: (1) the EnCap Credit
Agreement or any other Loan Document, (2) the making of any loans or
advances
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 3
thereunder or the failure or refusal to make any loans or advances
thereunder, (3) any actual, claimed, threatened, or alleged exercise by
any Investor Entity of any of its rights or remedies under or in
connection with the EnCap Credit Agreement, any of the other Loan
Documents, or any Collateral, (4) any other transactions of any kind
among any of the Benz Entities and any of the Investor Entities, or (5)
any actual or alleged negotiations, discussions, representations,
warranties, promises, or other undertakings by any Investor Entity in
connection with any of the foregoing; provided that the "Released
Claims" shall not include any rights of Benz under Articles VII, XI, XII
and XVIII of that certain Purchase and Sale Agreement dated January 23,
1998, by and between Lasco Energy Partners, L.P., as seller, and Benz,
as buyer.
"Standstill Period" means the period from the date hereof through
and including February 28, 1999.
"Warrants" means all of those Stock Purchase Warrants issued by
Benz to EnCap III LP, to BOCP, to EnCap Energy Capital Fund-B, L.P., and
to Energy Capital Investment Company PLC on or before the date hereof.
Borrower and Benz desire to increase the amount available for borrowing
under the Bank One Credit Facility by $2,000,000 and, to that end, have
requested BOCP to purchase a $2,000,000 participation in the Bank One Credit
Facility. Borrower and Benz have also requested that in the event Borrower
fails to pay any portion of the $1,500,000 prepayment due under the Bank One
Credit Facility on December 18, 1998, BOCP purchase on such date an
additional participation in the Bank One Credit Facility in an amount equal
to that portion of such prepayment not made on such date, such participation
not to exceed $1,500,000. Borrower, Calibre and Benz have also requested
EnCap III LP to extend the maturity of the EnCap Credit Agreement until the
end of the Standstill Period. In order to induce BOCP and EnCap III LP to do
so, and in consideration of such purchase by BOCP and of the covenants and
agreements set out below, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Borrower, the
Guarantors/Shareholders, BOCP and EnCap III LP hereby agree as follows for
the benefit of each other and for the benefit of each of the Investor
Entities:
1. BOCP hereby agrees to purchase a $2,000,000 participation interest in
the Bank One Credit Facility on the terms set out in the participation
agreement attached hereto as Annex C, provided that (a) Borrower and
Bank One concurrently enter into a Third Amendment to Letter Loan
Agreement in the form attached as Annex D hereto and (b) Borrower
satisfies the conditions set out in paragraph 10 of such Third
Amendment. BOCP hereby further agrees that in the event Borrower fails
to pay any portion of the $1,500,000 prepayment due under the Bank One
Credit Facility on December 18, 1998,
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 4
BOCP shall on such date purchase an additional participation in the Bank
One Credit Facility in an amount equal to that portion of such
prepayment not made on or prior to such date, such participation not to
exceed $1,500,000, on the same terms set out in the participation
agreement attached hereto as Annex C, PROVIDED that (i) such
participation shall not increase the outstanding indebtedness under the
Bank One Credit Facility and (ii) no default exists under the EnCap
Credit Agreement as of such date, other than (a) the Disclosed Defaults
(as defined below), (b) a Default or Event of Default under Section
8.1(g) of the EnCap Credit Agreement, so long as neither Bank One nor
any other Person has taken any action or otherwise commenced the
enforcement of any obligation or the exercise of any remedy with respect
to any obligation as a result of such underlying failure constituting
such Default or Event of Default under such Section 8.1(g), (c) the
creation or assumption of any statutory Liens for taxes, statutory
mechanics' and materialmen's Liens in violation of Section 7.3(c)
securing Indebtedness not in excess of $100,000 individually or $250,000
in the aggregate, other than Indebtedness owing to 3-D Directional
Drilling Inc., Neighbors Drilling USA, Inc. or Scientific Drilling
International, Inc., in which case such Liens shall secure Indebtedness
not in excess of $400,000 individually or in the aggregate, (d) the
failure of an Oakvale Success to occur on or prior to such date.
2. EnCap III LP, Borrower, Benz and Calibre hereby amend Section 1.1 of the
EnCap Credit Agreement to replace the definition of "Maturity Date" in
the EnCap Credit Agreement with the following new definition:
"MATURITY DATE" MEANS FEBRUARY 28, 1999.
The Guarantors/Shareholders hereby consent to such amendment.
3. Borrower has notified EnCap III LP of certain specified defaults that
presently exist under the EnCap Credit Agreement (the "Disclosed
Defaults") and has requested waivers with respect thereto. EnCap III LP
has not waived or agreed to waive any of the Disclosed Defaults (nor
does it have any obligation to do so), but EnCap III LP does hereby
agree that, during the Standstill Period, it will not accelerate the
maturity of the loans outstanding under the EnCap Credit Agreement
because of any Disclosed Default or foreclose any of its liens (or
otherwise exercise any of its remedies against collateral) because of
any Disclosed Default.
4. Borrower and the Guarantors/Shareholders -- on behalf of themselves and, to
the extent they are permitted by law or are otherwise expressly authorized
to do so, on behalf of all other Benz Entities -- hereby ratify and
confirm each of the Loan Documents in all respects, waive any defenses,
set-offs or counterclaims with respect to the Loan
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 5
Documents or any of the indebtedness thereunder, and ratify and confirm
all liens and security interests with respect to the Collateral
heretofore given by any of them to or for the benefit of any Investor
Entity. Borrower and the Guarantors/Shareholders hereby agree not to
challenge the validity, priority or enforceability of the Loan Documents
or of any liens or security interests at any time given to any Investor
Entity with respect to any Collateral.
5. The Bank One Loan Agreement provides that Borrower may, with BOCP's
consent, defer interest on "Tranche B" thereunder until the maturity of
the Bank One Credit Facility. BOCP hereby agrees to give its consent to
such deferral (in the form attached hereto as Annex A) whenever
requested by Borrower, provided that Benz first executes and delivers to
EnCap III LP an amendment to the Warrants in the form attached hereto as
Annex B, together with a copy (certified by Benz's Secretary) of
resolutions of Benz's Board of Directors expressly authorizing such
amendment.
6. BORROWER AND THE GUARANTORS/SHAREHOLDERS -- ON BEHALF OF THEMSELVES AND,
TO THE EXTENT THEY ARE PERMITTED BY LAW OR ARE OTHERWISE EXPRESSLY
AUTHORIZED TO DO SO, ON BEHALF OF ALL OTHER BENZ ENTITIES -- HEREBY
GENERALLY RELEASE AND FOREVER DISCHARGE THE INVESTOR ENTITIES FROM ANY
AND ALL RELEASED CLAIMS. THIS RELEASE IS TO BE CONSTRUED AS THE
BROADEST TYPE OF GENERAL RELEASE AND COVERS AND RELEASES ANY AND ALL
RELEASED CLAIMS, WHETHER KNOWN OR UNKNOWN AND HOWEVER OR WHENEVER
ARISING, WHETHER BY CONTRACT OR AGREEMENT, AT LAW OR UNDER ANY STATUTE
(INCLUDING WITHOUT LIMITATION ANY LAW OR STATUTE PERTAINING TO
NEGLIGENCE, GROSS NEGLIGENCE, STRICT LIABILITY, FRAUD, DECEPTIVE TRADE
PRACTICES, NEGLIGENT MISREPRESENTATION, SECURITIES VIOLATIONS, BREACH OF
FIDUCIARY DUTY, BREACH OF CONTRACT, TRADE REGULATION, REGULATION OF
BUSINESS OR COMPETITION, CONSPIRACY OR RACKETEERING), OR OTHERWISE
ARISING, AND EXPRESSLY INCLUDING ANY CLAIMS FOR PUNITIVE OR EXEMPLARY
DAMAGES, ATTORNEYS' FEES, OR PENALTIES. TO THE EXTENT THAT ANY RELEASED
CLAIMS WITH RESPECT TO ANY INVESTOR ENTITY HAVE NOT BEEN RELEASED BY
THIS LETTER AGREEMENT,
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 6
BORROWER AND THE GUARANTORS/SHAREHOLDERS HEREBY ASSIGN SUCH RELEASED
CLAIMS TO SUCH INVESTOR ENTITY.
7. Borrower, the Guarantors/Shareholders, BOCP and EnCap III LP agree that
upon the written demand of any party, whether made before or after the
institution of any legal proceedings, but prior to the rendering of any
judgment in that proceeding, all disputes, claims and controversies
between any of them, whether individual, joint, or class in nature,
arising from any Loan Document or otherwise, including without
limitation contract disputes and tort claims, shall be resolved by
binding arbitration pursuant to the Commercial Rules of the American
Arbitration Association ("AAA"). Any arbitration proceeding held
pursuant to this arbitration provision shall be conducted in Houston,
Texas, or at any other place selected by mutual agreement of the
parties. This arbitration provision shall not limit the right of any
party during any dispute, claim or controversy to seek, use, and employ
ancillary, or preliminary rights and/or remedies, judicial or otherwise,
and any such action shall not be deemed an election of remedies. Such
remedies include, without limitation, obtaining injunctive relief or a
temporary restraining order, invoking a power of sale under any deed or
trust or mortgage, obtaining a writ of attachment or imposition of a
receivership, or exercising any rights relating to personal property,
including exercising the right of set-off, or taking or disposing of
such property with or without judicial process pursuant to the Uniform
Commercial Code. Any disputes, claims or controversies concerning the
lawfulness or reasonableness of an act, or exercise of any right or
remedy concerning any mortgaged property, including any claim to
rescind, reform, or otherwise modify any agreement relating to any
mortgaged property, shall also be arbitrated, provided, however, that no
arbitrator shall have the right or the power to enjoin or restrain any
act of any party. Judgment upon any award rendered by any arbitrator
may be entered in any court having jurisdiction. The statute of
limitations, estoppel, waiver, laches and similar doctrines which would
otherwise be applicable in an action brought by a party shall be
applicable in any arbitration proceeding, and the commencement of an
arbitration proceeding shall be deemed the commencement of any action
for these purposes. The Federal Arbitration Act (Title 9 of the United
States Code) shall apply to the construction, interpretation, and
enforcement of this arbitration provision.
8. EACH OF BORROWER, THE GUARANTORS/SHAREHOLDERS, ENCAP III LP AND BOCP
HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVES AND
RELEASES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY
HAVE TO CLAIM OR RECOVER ANY "SPECIAL DAMAGES", AS DEFINED BELOW, FROM
ANY OTHER PARTY HERETO IN RESPECT OF ANY
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 7
LITIGATION (INCLUDING ARBITRATION PROCEEDINGS) BASED ON, OR DIRECTLY OR
INDIRECTLY AT ANY TIME ARISING OUT OF, UNDER OR IN CONNECTION WITH, ANY
ACTIONS, FAILURES TO ACT, OR EVENTS AT ANY TIME OCCURRING (WHETHER
BEFORE, AT OR AFTER THE EFFECTIVE DATE HEREOF) WHICH IN ANY WAY RELATE
TO OR ARE BASED UPON ANY OF THE FOLLOWING: (1) THE ENCAP CREDIT
AGREEMENT OR ANY OTHER LOAN DOCUMENT, (2) THE MAKING OF ANY LOANS OR
ADVANCES THEREUNDER OR THE FAILURE OR REFUSAL TO MAKE ANY LOANS OR
ADVANCES THEREUNDER, (3) ANY ACTUAL, CLAIMED, THREATENED, OR ALLEGED
EXERCISE BY ANY INVESTOR ENTITY OF ANY OF ITS RIGHTS OR REMEDIES UNDER
OR IN CONNECTION WITH THE ENCAP CREDIT AGREEMENT, ANY OF THE OTHER LOAN
DOCUMENTS, OR ANY COLLATERAL, (4) ANY OTHER TRANSACTIONS OF ANY KIND
AMONG ANY OF THE BENZ ENTITIES AND ANY OF THE INVESTOR ENTITIES, OR (5)
ANY ACTUAL OR ALLEGED NEGOTIATIONS, DISCUSSIONS, REPRESENTATIONS,
WARRANTIES, PROMISES, OR OTHER UNDERTAKINGS BY ANY PARTY HERETO IN
CONNECTION WITH ANY OF THE FOREGOING. AS USED IN THIS LETTER "SPECIAL
DAMAGES" INCLUDES ALL SPECIAL, CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE
DAMAGES (REGARDLESS OF HOW NAMED), BUT DOES NOT INCLUDE ANY PAYMENTS OR
FUNDS WHICH ANY PARTY HERETO HAS IN ANY LOAN DOCUMENT OR OTHER DOCUMENT,
SECURITY OR INSTRUMENT EXPRESSLY PROMISED TO PAY OR DELIVER.
9. EACH OF BORROWER, THE GUARANTORS/SHAREHOLDERS, ENCAP III LP AND BOCP
HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVES, TO
THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR DIRECTLY OR
INDIRECTLY AT ANY TIME ARISING OUT OF, UNDER OR IN CONNECTION WITH THE
LOAN DOCUMENTS OR ANY TRANSACTION CONTEMPLATED THEREBY OR ASSOCIATED
THEREWITH, BEFORE OR
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 8
AFTER MATURITY, AND CERTIFIES THAT NO PARTY HERETO NOR ANY
REPRESENTATIVE OR AGENT OR COUNSEL FOR ANY PARTY HERETO HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, OR IMPLIED THAT SUCH PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE WAIVERS IN THIS PARAGRAPH AND
THE FOREGOING PARAGRAPH, AND ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO
ENTER INTO THIS LETTER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY BY, AMONG OTHER THINGS, THE ARBITRATION PROVISIONS, MUTUAL
WAIVERS, AND CERTIFICATIONS CONTAINED IN THIS PARAGRAPH AND THE TWO
PRECEDING PARAGRAPHS.
10. Borrower and the Guarantors/Shareholders hereby represent and warrant to
BOCP and EnCap III LP that this letter agreement has been duly
authorized in all respects, does not conflict with any obligation or
duty owed by any of them, and is enforceable in accordance with its
terms.
11. Borrower has requested BOCP to increase its participation interest in
the Bank One Credit Facility from $2,000,000 to as much as $6,000,000,
allowing Bank One to increase its advances thereunder by up to
$4,000,000. From an economic perspective -- assuming that Borrower and
BOCP can, using commercially reasonable criteria, agree upon the
expenditures to be made with such new funds, that an Oakvale Success
occurs, and that Borrower is successful in reducing its general and
administrative expenses and its expenditures for seismic and leasing
activities -- BOCP is willing to make reasonable efforts to do so,
provided that the consent and cooperation of Bank One can be obtained,
that appropriate documentation can be completed to evidence such
additional participation and advances, that the relevant persons
(including Borrower and BOCP) can agree upon how to deal with the "NPI
Conveyances" referred to in the EnCap Credit Agreement, and that
appropriate arrangements are made with respect to Benz's corporate
governance following the end of the Standstill Period, all to the
satisfaction of Borrower and BOCP. Borrower and BOCP agree to work
together after the execution of this letter to try to quickly resolve
the foregoing issues and complete such documentation to the satisfaction
of each, but all of the parties hereto understand and agree that neither
Borrower nor BOCP shall have any liability as a result of any failure to
resolve such issues or to complete such documentation.
12. As an alternative to the participation described in the preceding
paragraph, Borrower has requested EnCap III LP to advance additional
funds of up to $4,000,000 to Borrower
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 9
during the Standstill Period. From an economic perspective -- assuming
that Borrower and EnCap III LP can, using commercial reasonable
criteria, agree upon the expenditures to be made with such new funds,
that an Oakvale Success occurs, and that Borrower is successful in
reducing its general and administrative expenses and its expenditures
for seismic and leasing activities - EnCap III LP is willing to make
reasonable efforts to do so, provided that certain issues can first be
resolved. These issues are obtaining the consent and cooperation of
Bank One and the holders of certain debentures and notes issued by Benz,
confirmation to EnCap III LP's satisfaction that such advances will be
secured with the same priority as the indebtedness presently outstanding
under the EnCap Credit Agreement, the completion of appropriate
documentation to evidence such advances, with terms and conditions
substantially the same as the EnCap Credit Agreement and otherwise
reasonably satisfactory to both EnCap III LP and Borrower, agreement by
all relevant persons (including Borrower and EnCap III LP) upon how to
deal with the "NPI Conveyances" referred to in the EnCap Credit
Agreement, and the making of appropriate arrangements with respect to
Benz's corporate governance following the end of the Standstill Period,
all to the satisfaction of Borrower and EnCap III LP. Borrower and
EnCap III LP agree to work together after the execution of this letter
to try to quickly resolve the foregoing issues and complete such
documentation to the satisfaction of each, but all of the parties hereto
understand and agree that neither Borrower nor EnCap III LP shall have
any liability as a result of any failure to resolve such issues or to
complete such documentation.
13. Benz has informed EnCap III LP and BOCP that Benz is interested in
obtaining long term funding for its drilling prospects and operations
through a merger or similar combination with another oil and gas company
and that Benz has begun informal discussions of such a merger with at
least one other company. Benz agrees to keep EnCap III LP and BOCP
informed about any such merger discussions and about the terms thereof,
including without limitation any post-closing price adjustments that
Benz may choose to negotiate, and EnCap III LP and BOCP agree not to
discuss such a merger of Benz with any third parties unless Benz has
been notified that discussions with such third party may occur. All
parties hereto understand and agree that the ultimate decision about
whether or not to proceed with any such merger or combination, and about
the terms thereof, will be made by Benz's board of directors and
shareholders.
14. Borrower hereby agrees to provide to EnCap III LP and to Bank One,
within five business days after the end of every two-week period,
schedules showing all of its accounts payable (in any categories) at the
end of such period and all payments made on its accounts payable during
such period. The first such report shall be due on November 20, 1998
with respect to the two-week ending November 13, 1998. Borrower also
agrees to provide to EnCap III LP and to Bank One, within fifteen days
after the end of every calendar month, a schedule showing all of its
accounts receivable (in any categories) at
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 10
the end of such month. The first such report shall be due on December 15,
1998 with respect to the month of November 1998.
15. This letter agreement shall be governed by and construed under the laws
of the State of Texas and of the United States of America. This letter
agreement may be executed in multiple counterparts and by the different
parties hereto in separate counterparts, all of which shall constitute
one and the same agreement. This letter agreement shall take effect
upon its execution by all parties hereto.
Please execute a counterpart of this letter in the space provided below to
evidence your agreement to the foregoing.
TEXSTAR PETROLEUM, INC.
By: /s/ Prentis B. Tomlinson, Jr.
-----------------------------
Prentis B. Tomlinson, Jr., Chief Executive Officer
BENZ ENERGY LTD.
By: /s/ Prentis B. Tomlinson, Jr.
-----------------------------
Prentis B. Tomlinson, Jr., Chairman
CALIBRE ENERGY, L.L.C.
By: /s/ L. E. Walker
-----------------------------
L. E. Walker, Manager and President
BENZ PROPERTIES LTD.
By: /s/ Prentis B. Tomlinson, Jr.
-----------------------------
Prentis B. Tomlinson, Jr., President
/s/ Prentis B. Tomlinson, Jr.
-----------------------------
PRENTIS B. TOMLINSON, JR.
BOCP Energy Partners, L.P.
EnCap Energy Capital Fund III, L.P.
November 4, 1998
Page 11
TEXSTAR HOLDINGS, L.L.C.
By: /s/ Prentis B. Tomlinson, Jr.
------------------------------
Prentis B. Tomlinson, Jr., President
/s/ Prentis B. Tomlinson, Jr.
----------------------------------
PRENTIS B. TOMLINSON, JR., TRUSTEE
FOR AND ON BEHALF OF THE SLATTERY TRUST
/s/ Prentis B. Tomlinson, Jr.
----------------------------------
PRENTIS B. TOMLINSON, JR., TRUSTEE
FOR AND ON BEHALF OF THE RUSTON TRUST
/s/ Prentis B. Tomlinson, Jr.
----------------------------------
PRENTIS B. TOMLINSON, JR., TRUSTEE
FOR AND ON BEHALF OF THE HOUSTON TRUST
/s/ Heather J. Tomlinson
----------------------------------
HEATHER J. TOMLINSON, JR., TRUSTEE
FOR AND ON BEHALF OF THE STARBUCKS TRUST
AGREED TO as of the date first
written above:
BOCP ENERGY PARTNERS, L.P.
By: EnCap Investments L.C., Manager
By: /s/ Robert L. Zorich
---------------------------------
Robert L. Zorich, Managing Director
ENCAP ENERGY CAPITAL FUND III, L.P.
By: EnCap Investments L.C., its general partner
By: /s/ Robert L. Zorich
---------------------------------
Robert L. Zorich, Managing Director