S-4

As filed with the United States Securities and Exchange Commission on March 28, 2001.
                                                                                                   Registration No. 333–_____

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S–4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

ASCENT ENERGY INC.
(Exact name of registrant as specified in its charter)

Delaware  (State or other jurisdiction of incorporation   or organization)	1311 (Primary Standard Industrial Code Number)	72–1493233  (I.R.S. Employer Identification Number)
650 Poydras Street, Suite 2200 New Orleans, Louisiana 70130 (504) 586–8888 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

Jeffrey Clarke
President
Ascent Energy Inc.
650 Poydras Street, Suite 2200
New Orleans, Louisiana 70130
(504) 586–8888
(Name, address, including zip code, and telephone
number, including area code, of agent for service) Copy to:
James D. Canafax, Esq.
William B. Masters, Esq.
Jones, Walker, Waechter,
Poitevent, Carrere & Denegre, L.L.P.
201 St. Charles Avenue, 51st Floor
New Orleans, Louisiana 70170
telephone: (504) 582–8000
fascimile: (504) 582–8012

Approximate date of commencement of proposed sale to the public:
As soon as practicable after this registration statement becomes effective and
upon consummation of the transactions described in the enclosed prospectus.

            If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. 9

            If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. 9

            If this Form is a post–effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. 9

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered	Amount to be registered(1)	Proposed Maximum offering price per unit	Proposed Maximum Aggregate Offering Price(2)	Amount of registration fee(3)
8% Series B Convertible Preferred Stock, $0.001 par value	5,323,695 shares	N/A	$3,493,674.84	$873.42
Common Stock, $0.001 par value(4)	–––	–––	–––	–––

(1)	Represents the maximum number of shares of 8% Series B Convertible Preferred Stock estimated to be exchanged, as part of the consideration paid, for each share of common stock, par value $0.0001 per share, of Pontotoc Production, Inc. upon the consummation of the merger of Pontotoc Acquisition Corp., a Nevada corporation and a wholly owned subsidiary of the registrant, with Pontotoc Production, Inc.
(2)	Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(f)(1) and (3) and Rule 457(c) of the Securities Act of 1933, as amended (the "Securities Act"), based on the product of (i) $9.65625, the average of the high and low sales prices of Pontotoc Production, Inc. common stock on March 22, 2001 as reported by the Nasdaq National Market and (ii) 5,323,695 shares of Pontotoc Production, Inc. common stock, the number of shares of Pontotoc Production, Inc. common stock outstanding at the close of business on March 22, 2001, less $47,913,255, the amount of cash to be paid by the registrant in connection with the exchange if all outstanding shares of Pontotoc Production, Inc. common stock are exchanged. Pursuant to Rule 457(i), the registration fee is calculated on the basis of the 8% Series B Convertible Preferred Stock alone.
(3)	Computed in accordance with Rule 457(f) under the Securities Act to be $1,039.78 which is equal to 0.000250 multiplied by the proposed maximum aggregate offering price of $3,493,674.84.
(4)	There is also registered hereunder such indeterminate number of shares of Common Stock as may be issuable upon conversion of the 8% Series B Convertible Preferred Stock being registered hereunder and, pursuant to Rule 416 under the Securities Act, such additional shares as may be issuable as a result of the "anti–dilution" provisions thereof

            The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), may determine.

            The information in this prospectus may change. We may not complete the exchange offer and issue these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to completion, dated March 27, 2001

Prospectus

Ascent Energy Inc.

OFFER TO EXCHANGE
EACH OUTSTANDING SHARE
OF COMMON STOCK

OF

PONTOTOC PRODUCTION, INC.

FOR

$9.00 IN CASH

AND

ONE SHARE OF 8% SERIES B CONVERTIBLE PREFERRED STOCK

OF

ASCENT ENERGY INC.
HAVING A LIQUIDATION PREFERENCE OF $2.50 PER SHARE
___________________________

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON _______, 2001, UNLESS EXTENDED. SHARES TENDERED PURSUANT TO THE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION OF THE OFFER, BUT NOT DURING ANY SUBSEQUENT OFFERING PERIOD.

            On January 19, 2001, we entered into an Agreement and Plan of Merger with Pontotoc. Pontotoc's board of directors has unanimously approved the merger agreement, determined that the offer is fair to, and in the best interests of, Pontotoc stockholders and recommends that Pontotoc stockholders accept the offer and tender their shares pursuant to the offer.

            Through Pontotoc Acquisition Corp., our wholly owned subsidiary, we are offering to exchange $9.00 in cash and one share of our Series B preferred stock having a liquidation preference of $2.50 for each outstanding share of Pontotoc common stock that is validly tendered and not properly withdrawn.

            Our obligation to exchange cash and our Series B preferred stock for Pontotoc common stock is subject to the conditions listed under "The Offer – Conditions of Our Offer." There is no public market for our common stock or our preferred stock and it is not likely that any will develop in the near future. Pontotoc's common stock is traded on the Nasdaq National Market under the symbol "PNTU."

            See "Risk Factors" beginning on page 19 for a discussion of various factors you should consider in connection with the offer and the merger.

            We are not asking you for a proxy and you are requested not to send us a proxy. Any request for proxies will be made only pursuant to separate proxy solicitation materials complying with the requirements of Section 14(a) of the Securities Exchange Act of 1934.

            Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. This prospectus does not constitute an offer to sell, or the solicitation of an offer to buy, to any person in any jurisdiction to whom it is unlawful to make such an offer or in any state in which such offer or solicitation would be unlawful prior to registration or qualification under the securities laws of such state.

The date of this prospectus is __________, 2001.

TABLE OF CONTENTS

QUESTIONS AND ANSWERS ABOUT THE OFFER		1
WHERE YOU CAN FIND MORE INFORMATION		5
SUMMARY		6
SELECTED HISTORICAL FINANCIAL DATA		13
SELECTED UNAUDITED PRO FORMA COMBINED FINANCIAL DATA		17
RISK FACTORS		19
FORWARD–LOOKING STATEMENTS		29
COMPARATIVE PER SHARE PRICES AND DIVIDENDS		31
CAPITALIZATION		32
REASONS FOR THE OFFER		33
	Reasons for the Offer	33
	Reasons for the Pontotoc Board's Recommendation; Factors Considered	33
BACKGROUND OF THE OFFER		35
THE OFFER		36
	The Offer	36
	Timing of Our Offer	36
	Extension, Termination and Amendment	36
	Exchange of Shares; Delivery of Cash and Our Series B Preferred Stock	37
	Fractional Shares of Our Series B Preferred Stock	38
	Withdrawal Rights	38
	Procedure for Tendering	38
	Guaranteed Delivery	39
	Material Federal Income Tax Consequences	40
	Reasons for the Offer; the Merger; Dissenters' Rights	41
	Conditions of Our Offer	44
	Regulatory Clearances	45
	Possible Effects of Our Offer	45
	Source and Amount of Funds	46
	Relationships with Pontotoc	47
	Interests of Certain Persons in the Offer and the Merger	47
	Accounting Treatment	48
	Fees and Expenses	49
THE MERGER AGREEMENT AND THE STOCKHOLDERS' AGREEMENT		50
	The Offer	50
	The Merger	50
	Pontotoc Board of Directors	51
	Treatment of Pontotoc Stock Options	51
	Covenants and Representations and Warranties	51
	Conditions of Our Offer	53
	Conditions of the Merger	53
	Termination of the Merger Agreement	53
	Termination Fees	54
	Amendments	55
	The Stockholders' Agreement	55
CONDENSED UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS		57
ASCENT ENERGY'S BUSINESS AND PROPERTIES		63
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL          CONDITION AND RESULTS OF OPERATIONS		71
ASCENT ENERGY'S MANAGEMENT		77
BENEFICIAL OWNERSHIP OF COMMON STOCK		80
DESCRIPTION OF ASCENT ENERGY CAPITAL STOCK		81
COMPARISON OF STOCKHOLDERS' RIGHTS		90
LEGAL MATTERS		97
INDEPENDENT ACCOUNTANTS		97
RESERVE ENGINEERS		97
INDEX TO FINANCIAL STATEMENTS		F–1
ANNEX A:   AGREEMENT AND PLAN OF MERGER		A–1
ANNEX B:   OPINION OF C.K. COOPER AND COMPANY		B–1
ANNEX C:   PONTOTOC ANNUAL REPORT FOR FISCAL YEAR ENDED MARCH 31, 2000		C–1
ANNEX D:   PONTOTOC QUARTERLY REPORT FOR QUARTER ENDED DECEMBER 31, 2000		D–1
ANNEX E:   CERTIFICATE OF DESIGNATIONS FOR 8% SERIES B CONVERTIBLE PREFERRED                        STOCK		E–1
ANNEX F:   GENERAL CORPORATION LAW OF NEVADA –– DISSENTERS' RIGHTS		F–1

THIS DOCUMENT INCORPORATES IMPORTANT BUSINESS AND FINANCIAL INFORMATION ABOUT PONTOTOC FROM DOCUMENTS FILED WITH THE SEC. THIS INFORMATION IS AVAILABLE AT THE INTERNET WEB SITE THE SEC MAINTAINS AT HTTP://WWW.SEC.GOV, AS WELL AS FROM OTHER SOURCES. SEE "WHERE YOU CAN FIND MORE INFORMATION" ON PAGE 5. IN ADDITION, SOME OF THIS INFORMATION IS INCLUDED IN THE DOCUMENTS ATTACHED TO THIS PROSPECTUS AS ANNEXES C AND D.

YOU ALSO MAY REQUEST COPIES OF THESE DOCUMENTS FROM US, WITHOUT CHARGE, UPON WRITTEN OR ORAL REQUEST TO OUR INFORMATION AGENT, INNISFREE M&A INCORPORATED, 501 MADISON AVENUE, 20TH FLOOR, NEW YORK, NEW YORK, 10022, COLLECT AT (212) 750–5833 OR TOLL–FREE AT (888) 750–5834. IN ORDER TO RECEIVE TIMELY DELIVERY OF THE DOCUMENTS, YOU SHOULD MAKE YOUR REQUESTS NO LATER THAN __________, 2001.

QUESTIONS AND ANSWERS ABOUT THE OFFER

Q:

What are Ascent Energy and Pontotoc proposing?

A:

Ascent Energy proposes to acquire all outstanding shares of Pontotoc common stock. Ascent Energy has entered into a merger agreement with Pontotoc pursuant to which we are offering, through Pontotoc Acquisition Corp., our wholly–owned subsidiary, to exchange cash and shares of our Series B preferred stock as described in the next answered question for each outstanding share of Pontotoc common stock. After the offer is completed, Pontotoc Acquisition will merge with Pontotoc. As a result of the offer and the merger, Pontotoc will become our wholly owned subsidiary.

Q:

What would I receive in exchange for my Pontotoc shares?

A:

We are offering to exchange $9.00 in cash and one share of our Series B preferred stock having a liquidation preference of $2.50 per share for each outstanding share of Pontotoc common stock that is validly tendered and not properly withdrawn. The shares of our Series B preferred stock being offered are convertible into our common stock as described under "Description of Ascent Energy Capital Stock – Preferred Stock –– Series B Convertible Preferred Stock."

Q:

Who is Ascent Energy?

A:.

Ascent Energy was organized on January 9, 2001 principally for the acquisition of Pontotoc. Ascent Energy is a wholly owned subsidiary of Forman Petroleum Corporation, an independent energy company engaged in the acquisition, exploitation, exploration, development, and production of natural gas and crude oil in South Louisiana. Concurrently with the consummation of the offer, Forman will contribute all of its assets and liabilities to Ascent Energy. Accordingly, Forman will become a holding company. In addition, Ascent Energy plans to raise approximately $21.1 million through an offering of its 8% Series A Redeemable Preferred Stock and warrants to purchase shares of its common stock. Ascent Energy plans to offer these securities to the existing stockholders of Forman on a pro rata basis.

Q:     What are the terms of the Series B preferred stock?

A:	Dividends	Cumulative from the date of issuance and payable at the annual rate of 8% on a quarterly basis, commencing on the initial date of issuance.
	Liquidation Preference	$2.50 per share, plus accrued and unpaid dividends.
	Optional Conversion	Convertible at the option of the holder at any time prior to the second anniversary of the date of issuance, unless previously redeemed. The Series B preferred stock is convertible into shares of our common stock at a conversion rate of 0.1878395 shares of common stock per share of Series B preferred stock, subject to adjustment.
	Mandatory Conversion	Mandatorily convertible into common stock on the second anniversary date of the date of issuance at the same conversion rate described above.
	Optional Redemption	Redeemable, in whole or in part, at our option at any time at a redemption price equal to 100% of the $2.50 preferred liquidation preference plus any accrued and unpaid dividends to the redemption date.
	Voting Rights	The Series B preferred stock will be non–voting, except that the holders will be entitled to vote together as a single class on any amendments to our certificate of incorporation or certificate of designations for the Series B preferred stock that would materially and adversely affect the rights, preferences or privilege of the Series B preferred stockholders.
	Ranking	The Series B preferred stock ranks senior to our common stock and equal to our Series A preferred stock with respect to dividends and liquidating distributions. The Series B preferred stock will rank equal or senior to any future preferred stock.

Q:

Does Pontotoc support the offer and the merger?

A:

Yes. The members of the Pontotoc board of directors unanimously approved and declared advisable the merger agreement and the merger. The board also determined by unanimous vote that the offer is fair and in the best interests of Pontotoc stockholders and recommends that Pontotoc stockholders accept the offer and tender their shares pursuant to the offer. Information about the recommendation of Pontotoc's board of directors is more fully set forth in Pontotoc's Solicitation/Recommendation Statement on Schedule 14D–9, which is being mailed to Pontotoc stockholders together with this prospectus.

Q:	Has Pontotoc received a fairness opinion in connection with the offer and the merger?
A:	Yes. Pontotoc has received an opinion from C.K. Cooper and Company dated January 19, 2001, to the effect that the consideration to be received by Pontotoc stockholders pursuant to the merger agreement is fair from a financial point of view to the stockholders of Pontotoc. The opinion is included as Annex B to this prospectus.

Q:	Have any Pontotoc stockholders already agreed to tender their shares?
A:	Yes. As of the date of the merger agreement, each director and executive officer of Pontotoc agreed to tender all outstanding shares of Pontotoc common stock owned by him, which represents a total of 2,023,532 shares or approximately 38% of the outstanding common stock of Pontotoc.

Q:	What are the conditions to the acceptance of Pontotoc shares in the offer?
A:	The acceptance of Pontotoc shares in the offer is subject to several conditions, including:

• two–thirds of the outstanding Pontotoc shares, on a fully–diluted basis, having been validly tendered and not properly withdrawn, which we refer to as the minimum tender condition;

• the registration statement of which this prospectus is a part having been declared effective by the SEC and not being the subject of any stop order or any proceedings seeking a stop order;

• absence of any law, court order or regulatory action or proceeding seeking to delay or prohibit the offer or the merger;

• Pontotoc having not breached any covenant, representation or warranty in a material manner; 
• the merger agreement not having been terminated in accordance with its terms;
  
• Ascent Energy having obtained financing for the offer (subject to liquidated damages in the amount of $2 million being payable by us if all the other conditions have been satisfied);
  
• Pontotoc's total proved reserves, total proved reserves behind pipe and total proved developed producing reserves being at or above minimum predetermined levels; and
  
• the amount of debt outstanding under Pontotoc's credit facility (net of cash, cash equivalents and amounts used to satisfy margin requirements) being no greater than $6.8 million.

  These and other conditions to the offer are discussed in this prospectus under "The Offer – Conditions of Our Offer" beginning on page 44.

Q:	How long will it take to complete the offer and the merger?
A:	We hope to complete the offer in the second quarter of 2001. We expect to complete the merger shortly after we complete the offer.

Q:	How do I participate in the offer?
A:	To tender your shares, you should do the following:

• If you hold your shares in your own name, complete and sign the enclosed letter of transmittal and return it with your share certificates to Mellon Investor Services LLC, the exchange agent for the offer at one of its addresses on the back cover of this prospectus.

• If you hold your shares in "street name" through a broker, ask your broker to tender your shares. For more information about the timing of the offer, extensions of the offer period and your rights to withdraw your shares from the offer before the expiration date, please refer to "The Offer" beginning on page 36.

Q:	Do I have to pay any fees or commissions?
A:	If you are the record owner of your shares and you tender your shares in the offer, you will not incur any brokerage fees. If you own your shares through a broker or other nominee who tenders the shares on your behalf, your broker may charge you a fee for doing so. You should consult your broker or nominee to determine whether any charges will apply.

Q:

Will I be taxed on the cash and shares of Ascent Energy preferred stock I receive?

A:

Yes, the exchange of your Pontotoc shares for cash and shares of our Series B preferred stock will be a taxable transaction for U.S. federal income tax purposes. You will generally recognize gain or loss equal to the difference between (a) the sum of the amount of cash received plus the fair market value of the shares of our Series B preferred stock on the date your Pontotoc shares are accepted for exchange and (b) the aggregate tax basis of the Pontotoc shares you tendered. That gain or loss will be capital gain or loss (assuming you hold your Pontotoc shares as a capital asset) and any such capital gain or loss will be long term if, as of such time, you have held the Pontotoc shares for more than one year. If you receive the cash and shares of our Series B preferred stock in the merger, you will have the same federal income tax consequences, except that the fair market value of our Series B preferred stock will be determined as of the effective time of the merger.

Q:

Do the statements on the cover page regarding this prospectus being subject to change and the registration statement filed with the SEC not yet being effective mean that the offer has not commenced?

A:

No. Effectiveness of the registration statement is not necessary for the offer to commence. The SEC recently changed its rules to permit exchange offers to begin before the related registration statement has become effective, and we may take advantage of the rule changes with the goal of acquiring Pontotoc faster than similar acquisitions could be previously accomplished. We cannot, however, accept for exchange any shares tendered in the offer until the registration statement is declared effective by the SEC and the other conditions to the offer have been satisfied or, where permissible, waived. The offer will commence when we mail this prospectus and the related letter of transmittal to Pontotoc stockholders.

Q:

Is Ascent Energy's financial condition relevant to my decision to tender my shares in the offer?

A:

Yes. Shares of Pontotoc accepted in the offer will be exchanged in part for shares of our Series B preferred stock and so you should consider our financial condition before you decide to become one of our stockholders through the offer. In considering our financial condition, you should take into account that, concurrently with the consummation of the offer Forman will contribute all of its assets and liabilities to Ascent Energy. Accordingly, you should review our audited balance sheet and the audited financial statements of Forman (as our predecessor in interest), including the notes thereto, appearing elsewhere in this prospectus because they contain detailed business, financial and other information about us.

Q:

Will Pontotoc continue as a public company?

A:

No. If the merger occurs, Pontotoc will no longer be publicly owned. Even if the merger does not occur, if we purchase the tendered shares, there may be so few remaining Pontotoc stockholders and publicly held Pontotoc shares that the shares may no longer be eligible to be quoted on the Nasdaq National Market or other securities markets, there may not be a public trading market for the shares and Pontotoc may cease making filings with the SEC or otherwise cease being required to comply with SEC rules relating to publicly held companies.

Q:	If I decide not to tender, how will the offer affect my shares?
A:	If you decide not to tender your shares in the offer and the merger occurs, you will receive in the merger the same amount of cash and number of shares of our Series B preferred stock as if you had tendered your shares in the offer, without interest.
Q:	Who should I contact if I have more questions about the offer and the merger?
A:	You can contact our information agent, Innisfree M&A Incorporated, collect at (212) 750–5833 or toll–free at (888) 750–5834.

WHERE YOU CAN FIND MORE INFORMATION

            Forman, as a voluntary filer, and Pontotoc, pursuant to the requirements of the Securities Exchange Act of 1934, file annual, quarterly and special reports and other information with the Securities and Exchange Commission. Pontotoc also files proxy statements with the SEC. You may read and copy this information at the following locations of the SEC:

Public Reference Room
450 Fifth Street, N.W.
Room 1024
Washington, D.C. 20549 North East Regional Office
7 World Trade Center
Suite 1300
New York, New York 10048 Midwest Regional Office
500 West Madison Street
Suite 1400
Chicago, Illinois 60661–2511

            You may also obtain copies of this information by mail from the Public Reference Room of the SEC, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, at prescribed rates. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1–800–SEC–0330.

            The SEC also maintains an Internet worldwide website that contains reports, proxy statements and other information about issuers, like Ascent Energy, Forman and Pontotoc, who file electronically with the SEC. The address of that site is http://www.sec.gov.

            We filed a registration statement on Form S–4 to register with the SEC the Series B preferred stock to be issued pursuant to the offer and the merger and the common stock into which the Series B preferred stock is convertible. This prospectus is a part of that registration statement. As allowed by SEC rules, this prospectus does not contain all the information you can find in the registration statement or the exhibits to the registration statement. You may obtain copies of the Form S–4, and any amendments thereto, in the manner described above.

            The SEC allows us to "incorporate by reference" information into this prospectus, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus, except for any information superseded by information contained directly in this prospectus. This prospectus incorporates by reference the documents set forth below that Pontotoc has previously filed with the SEC. These documents contain important information about Pontotoc. The following documents listed below that Pontotoc has previously filed with the SEC are incorporated by reference, some of which are attached to this prospectus as Annexes C and D:

Pontotoc SEC Filings		Period
	Annual Report on Form 10–KSB		Year ended March 31, 2000
	Quarterly Reports on Form 10–QSB		Quarters ended December 31, 2000,    September 30, 2000 and June 30, 2000
	Proxy Statement on Schedule 14A		For 2000 Annual Meeting
	Current Reports on Form 8–K		Filed on June 15, 2000, August 4, 2000 and March 12, 2001

SUMMARY

         This brief summary highlights selected information from this document and does not contain all of the information that should be important to you. You should carefully read this entire document and the other documents to which this document refers you to fully understand the offer and the merger. See "Where You Can Find More Information" on page 5. In particular, you should read the documents attached to this document, including the merger agreement, attached as Annex A hereto.

Ascent Energy

            Ascent Energy was organized on January 9, 2001 principally for the acquisition of Pontotoc. Ascent Energy is a wholly owned subsidiary of Forman Petroleum Corporation. Forman is an independent energy company engaged in the acquisition, exploration, development, exploitation and production of natural gas and crude oil in South Louisiana. Concurrently with the consummation of the offer, Forman will be restructured as a holding company by contributing all of its assets and liabilities to Ascent Energy, a transaction we refer to as the "Restructuring". In addition, to help fund the Pontotoc acquisition, we plan to offer approximately $21.1 million of our Series A preferred stock and warrants to purchase our common stock to the existing stockholders of Forman on a pro rata basis. See "Selected Historical Financial Data," "Selected Unaudited Pro Forma Combined Financial Data," "Capitalization" and "Management's Discussion and Analysis of Financial Condition and Results of Operations." In this prospectus, the terms "we," "us," and "our" refer to Ascent Energy and, unless the context otherwise requires, gives effect to the Restructuring.

The Offer and the Merger (Page 36)

         We are proposing to acquire all outstanding shares of Pontotoc common stock. We are offering to exchange $9.00 in cash and one share of our Series B preferred stock having a liquidation preference of $2.50 for each share of Pontotoc common stock validly tendered and not properly withdrawn on or prior to the expiration date of the offer. The expiration date is currently __________, 2001 but we may extend the offer as described in "The Offer – Extension, Termination and Amendment" on page 36.

         We intend, promptly after completion of the offer, to merge Pontotoc Acquisition, our wholly owned subsidiary and the purchaser in the offer, with Pontotoc. Each share of Pontotoc common stock which has not been exchanged or accepted for exchange in the offer would be converted into the right to receive the same amount of cash and number of shares of our Series B preferred stock as is paid in the offer, without interest. We seek to acquire ownership of 100% of the Pontotoc stock through the offer and the merger.

            We expect to obtain the funds necessary to finance the offer and the merger from borrowings under our new credit facility described below, the sale of our Series A preferred stock and warrants and our internal resources. See "The Offer – Source and Amount of Funds" on page 46.

Information About Ascent Energy, Pontotoc Acquisition and Pontotoc (Page 63)

Ascent Energy Inc.
650 Poydras Street, Suite 2200
New Orleans, Louisiana 70130
Telephone: (504) 586–8888

         Ascent Energy is an independent energy company engaged in the acquisition, exploitation, exploration, development and production of natural gas and crude oil in South Louisiana. We were organized on January 9, 2001, principally for the purpose of acquiring Pontotoc. We have not carried on any activities other than in connection with the acquisition of Pontotoc and the Restructuring.

Pontotoc Acquisition Corp.
c/o Ascent Energy Inc.
650 Poydras Street, Suite 2200
New Orleans, Louisiana 70130
Telephone: (504) 586–8888

         Pontotoc Acquisition is our wholly owned subsidiary. Pontotoc Acquisition was organized on January 9, 2001 for the purpose of acquiring the Pontotoc shares tendered in response to the offer and merging with Pontotoc in the merger. It has not carried on any activities other than in connection with the merger agreement.

Pontotoc Production, Inc.
808 East Main
Ada, Oklahoma 74820
Telephone: (580) 436–6100

            Pontotoc is engaged in the exploration for and the acquisition, development and production of oil and natural gas. Pontotoc focuses on lower risk, shallow oil and gas properties in the State of Oklahoma. For more information about Pontotoc, please refer to Annexes C and D.

Reasons for the Offer and the Merger (Page 33)

            We are making the offer in order to acquire all of the outstanding shares of Pontotoc common stock. We intend, as soon as practicable after completion of the offer, to merge Pontotoc Acquisition with Pontotoc. The purpose of the merger is to acquire Pontotoc shares not tendered and exchanged pursuant to the offer.

            We believe the combined company will have a larger, more diversified asset base. In addition, we believe the combined company will have more efficient access to capital, at a lower cost than either Ascent Energy or Pontotoc has individually. We should also have an enhanced ability, as compared with either company on a stand–alone basis, to pursue more acquisitions or other development opportunities.

            To review the reasons for the offer and the merger in greater detail, see "Reasons for the Offer" on page 33.

Pontotoc's Recommendation

            Pontotoc's board of directors unanimously approved and declared advisable the merger agreement and the merger. The board also determined by unanimous vote that the offer is fair and in the best interests of Pontotoc stockholders and recommends that Pontotoc stockholders accept the offer and tender their shares pursuant to the offer. Information about the recommendation of Pontotoc's board of directors is more fully set forth in Pontotoc's Solicitation/Recommendation Statement on Schedule 14D–9, which is being mailed to Pontotoc stockholders together with this prospectus.

Our Offer

       We have attached the merger agreement governing the offer and the merger as Annex A to this prospectus. We encourage you to read this agreement because it is the legal document that governs the offer and the merger.

             What Pontotoc Stockholders Will Receive.

            We are offering, upon the terms and conditions set forth in this prospectus and the related letter of transmittal, $9.00 in cash and one share of our Series B preferred stock having a liquidation preference of $2.50 for each outstanding share of Pontotoc common stock validly tendered on or prior to the expiration date of the offer and not properly withdrawn.

            Each share of Pontotoc common stock which has not been exchanged or accepted for exchange in the offer would be converted in the merger into the right to receive the same per share consideration as is being paid in the offer.

            Timing of Our Offer.

            Our offer is scheduled to expire at 5:00 p.m., New York City time, on __________, 2001, but we may extend the offer from time to time as necessary until all the conditions to the offer have been satisfied or, where permissible, waived. We may not extend the offer beyond May 31, 2001, without the consent of Pontotoc. See "The Offer – Extension, Termination and Amendment" on page 36.

            Extension, Termination and Amendment.

            We expressly reserve the right, in our sole discretion (subject to the provisions of the merger agreement), at any time or from time to time, to extend the period of time during which the offer remains open, and we can do so by giving oral or written notice of an extension to the exchange agent. If we decide to extend the offer, we will make an announcement to that effect no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date. Subject to the provisions of the merger agreement, we are not making any assurance that we will exercise our right to extend the offer. During an extension, all Pontotoc shares previously tendered and not properly withdrawn will remain subject to the offer, subject to your right to properly withdraw your Pontotoc shares.

            Subject to the SEC's applicable rules and regulations, we also reserve the right, in our sole discretion, but subject to the provisions of the merger agreement, at any time or from time to time, to delay our acceptance for exchange of or, regardless of whether we previously accepted Pontotoc shares for exchange, exchange of any Pontotoc shares pursuant to the offer or to terminate the offer and not accept for exchange or exchange any Pontotoc shares not previously accepted for exchange or exchanged, upon the failure of any of the conditions of the offer to be satisfied. We also reserve our right to waive any condition, other than the minimum tender condition and the conditions relating to the absence of an injunction and the effectiveness of the registration statement for the shares of our Series B preferred stock to be issued in the offer, or otherwise to amend the offer in any respect, by giving oral or written notice of the waiver or amendment to the exchange agent and by making a public announcement.

            We will follow any extension, termination, amendment or delay, as promptly as practicable, with a public announcement. In the case of an extension, any announcement will be issued no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date. Subject to applicable law, including Rules 14d–4(d) and 14d–6(c) under the Securities Exchange Act of 1934, which require that any material change in the information published, sent or given to the stockholders in connection with the offer be promptly sent to stockholders in a manner reasonably designed to inform stockholders of the change, and without limiting the manner in which we may choose to make any public announcement, we assume no obligation to publish, advertise or otherwise communicate any public announcement other than by making a general release to the public.

                Exchange of Shares; Delivery of Cash and Our Series B Preferred Stock.

         Upon the terms and subject to the conditions of the offer, including, if the offer is extended or amended, the terms and conditions of any extension or amendment, we will accept for exchange, and will exchange, Pontotoc shares validly tendered and not properly withdrawn as promptly as practicable after the expiration date and promptly after they are tendered during any subsequent offering period.

                Withdrawal Rights.

         Your tender of Pontotoc shares pursuant to the offer is irrevocable, except that Pontotoc shares tendered pursuant to the offer may be properly withdrawn at any time prior to the expiration date, and, unless we previously accepted them for exchange pursuant to the offer, may also be properly withdrawn at any time after ________, 2001.

                Subsequent Offering Period.

         We may, although we do not currently intend to, elect to provide a subsequent offering period of three to twenty business days after the acceptance of Pontotoc shares pursuant to the offer if the requirements under Rule 14d–11 of the Securities Exchange Act of 1934 have been met. If we elect to provide a subsequent offering period, we will notify you by issuing a press release at least five business days before the expiration of the initial offering period and we will file that press release with the SEC. You will not have the right to withdraw any Pontotoc shares that you tender in the subsequent offering period.

                Procedure for Tendering Shares.

         For you to validly tender Pontotoc shares pursuant to the offer, either:

• a properly completed and duly executed letter of transmittal (or a manually executed facsimile of that document), along with any required signature guarantees, or an agent's message in connection with a book–entry transfer, and any other required documents, must be transmitted to and received by the exchange agent at one of its addresses set forth on the back cover of this prospectus, and certificates for tendered Pontotoc shares must be received by the exchange agent at one of those addresses, or those Pontotoc shares must be tendered pursuant to the procedure for book–entry tender (and a confirmation of receipt of the tender received), in each case before the expiration date. See the procedures for tendering shares on page 38 under "The Offer – Procedure for Tendering" for more details; or

• you must comply with the guaranteed delivery procedures set forth in "The Offer – Guaranteed Delivery."

Dissenters' Rights (Page 42)

         Our offer does not entitle you to dissenters' rights with respect to your Pontotoc shares but the subsequent merger will entitle you to dissenters' rights. If, at the end of the offer, we have received between two–thirds and 90% of the outstanding Pontotoc shares, we will effect a long–form merger as permitted under Nevada law. If at the end of the offer, however, we have received at least 90% of the outstanding Pontotoc shares, we will effect a short–form merger as permitted under Nevada law. In either case, Pontotoc stockholders who comply with the applicable statutory procedures under Nevada law will be entitled to dissenters' rights. In order to preserve their dissenters' rights, Pontotoc stockholders must follow strictly the Nevada law regarding dissenters' rights. For further description of these rights and the procedures you must follow to exercise your dissenters' rights, see page 42, as well as Annex F which contains a copy of the Nevada dissenters' rights statutes.

Material Federal Income Tax Consequences (Page 40)

         The receipt of cash and our Series B preferred stock in exchange for your Pontotoc shares pursuant to the exchange will be a taxable transaction. You will generally recognize gain or loss equal to the difference between (a) the sum of the amount of cash received plus the fair market value of the shares of our Series B preferred stock on the date your Pontotoc shares are accepted for exchange and (b) the aggregate tax basis in the Pontotoc shares you tendered. That gain or loss will be capital gain or loss (assuming you hold your Pontotoc shares as a capital asset). Any capital gain or loss will constitute long–term capital gain if you have held the Pontotoc shares for more than one year. Pontotoc stockholders receiving cash and shares of our Series B preferred stock in the merger will have the same federal income tax consequences, except that the fair market value of our Series B preferred stock will be determined at the effective time of the merger. See "The Offer – Material Federal Income Tax Consequences."

Ascent Energy Will Account for the Merger Using the Purchase Method (Page 48)

         We will account for the merger as a purchase for financial reporting purposes.

Ownership of Ascent Energy After the Merger (Page 80)

         We will issue approximately 5,323,695 shares of our Series B preferred stock to Pontotoc stockholders in the offer and the merger. Our Series B preferred shares will be immediately convertible into 10% of the outstanding shares of our common stock, on a fully–diluted basis, immediately following the merger. See "Beneficial Ownership of Common Stock."

Stockholder Vote Required After Our Offer to Approve the Merger (Page 41)

         The merger requires the affirmative vote of at least a majority of the shares of Pontotoc common stock outstanding on the record date for the meeting to approve the merger. If the minimum tender condition is satisfied and we purchase the tendered Pontotoc shares, we will own a majority of the Pontotoc common stock and approval of the merger by Pontotoc stockholders will be assured, subject to the other conditions to the merger. Moreover, if we have acquired 90% or more of the outstanding Pontotoc shares, the merger can be accomplished without a stockholder vote.

         As of the date of the merger agreement, each director and executive officer of Pontotoc agreed to tender all outstanding shares of Pontotoc common stock owned by him, which represents a total of 2,032,532 shares or approximately 38% of the outstanding common stock of Pontotoc.

Pontotoc Board (Page 51)

         The merger agreement provides that upon acceptance and payment for at least a majority of the outstanding Pontotoc shares, we will be entitled to designate a number of directors of Pontotoc (rounded up to the next whole number) equal to the product of the total number of directors on Pontotoc's board and the percentage of outstanding Pontotoc shares of common stock beneficially owned by us.

Interests of Pontotoc's Officers and Directors in the Merger (Page 47)

         When you consider the Pontotoc board's recommendation that Pontotoc stockholders tender their shares in the offer, you should be aware that some Pontotoc directors and executive officers may have interests in the offer and the merger that may be different from, or in addition to, yours, including:

• James "Robby" Robson, Jr. will become a member of our board of directors on the effective date of the merger and will continue to be employed by Pontotoc;

• each director and executive officer of Pontotoc agreed to tender all outstanding shares of Pontotoc common stock owned by him, which represents a total of 2,023,532 shares or approximately 38% of Pontotoc's outstanding common stock;

• the merger agreement provides for continuing indemnification and insurance coverage for Pontotoc's directors and officers;

• in connection with the merger, holders of Pontotoc's outstanding stock options, including James "Robby" Robson, Jr., Todd Robson and James Robson, Sr., will be entitled to receive a lump sum cash payment equal to the product of the number of Pontotoc shares subject to such stock options times the amount by which $10.50 exceeds the exercise price; and

• as contemplated by the merger agreement, Pontotoc has acquired the remaining 55% ownership interest in Pontotoc Holdings, Inc. from Timothy A. Jurek, a director of Pontotoc, and two other directors of Pontotoc Holdings, for an aggregate of 110,000 shares of Pontotoc common stock.

Conditions of Our Offer (Page 44)

         We will complete the offer only if specific conditions are satisfied or, in some cases, waived, including the following:

• two–thirds of the outstanding Pontotoc shares, on a fully–diluted basis, having been validly tendered and not properly withdrawn;

• the registration statement of which this prospectus is a part having been declared effective by the SEC and not being the subject of any stop order or proceeding seeking a stop order;

• absence of any law, court order or regulatory action or proceeding seeking to delay or prohibit the offer or the merger;

• Pontotoc having not breached any covenant, representation or warranty in a material manner;

• the merger agreement not having been terminated in accordance with its terms;

• Ascent Energy having obtained financing for the offer (subject to liquidated damages in the amount of $2 million being payable by us if all the other conditions have been satisfied);

• Pontotoc's total proved reserves, total proved reserves behind pipe and total proved developed producing reserves being at or above minimum predetermined levels; and

• the amount of debt outstanding under Pontotoc's credit facility (net of cash, cash equivalents and amounts owed to satisfy margin requirements) being no greater than $6.8 million.

            We also reserve our right to waive any condition (other than the minimum tender condition and the conditions relating to the absence of an injunction and the effectiveness of the registration statement for our shares of preferred stock to be issued in the offer) or otherwise to amend the offer in any respect, by giving oral or written notice of any waiver or amendment to the exchange agent and by making a public announcement.

Termination of the Merger Agreement (Page 53)

            The merger agreement may be terminated at any time prior to the effective time of the merger by mutual written consent of Ascent Energy and Pontotoc. In addition, either we or Pontotoc can terminate the merger agreement if:

• we do not consummate the offer by May 31, 2001 (a party in material breach or who failed to fulfill a material obligation of the merger agreement may not terminate it for this reason);

• the offer shall have expired or been terminated in accordance with the merger agreement without our having accepted any shares of Pontotoc common stock pursuant to the offer, other than as a result of our breach of the merger agreement;

• a law or regulation makes consummation of the merger illegal or otherwise prohibited or any judgment, injunction, order or decree which is final and nonappealable prohibits the merger; or

• any representation or warranty of the non–terminating party having become inaccurate in a way that is reasonably expected to have a material adverse effect on the non–terminating party, or the non–terminating party failing to perform a covenant (in each case, subject to a 30 day cure period).

            We can terminate the merger agreement if, prior to the effective date of the merger:

• Pontotoc's board of directors approves or recommends an acquisition proposal, as defined in the merger agreement;

• Pontotoc's board of directors withdraws, or amends or modifies in any way adverse to Ascent Energy its recommendation to the Pontotoc stockholders that they accept the offer and approve and adopt the merger agreement and the merger;

• Pontotoc fails to include its board's recommendation in documents related to the offer; or

• Pontotoc does not recommend rejection of a competing tender or exchange offer for 30% or more of Pontotoc's shares.

Termination Fees (Page 54)

            Pontotoc must pay us a termination fee of $3.2 million in cash if the merger agreement is terminated:

• by us for any of the reasons described in the immediately preceding four bullet points, where Pontotoc's board of directors has adversely changed its recommendation of the merger agreement proposal or has recommended an alternative transaction;

• by us or Pontotoc in certain limited circumstances if we do not consummate the offer by May 31, 2000 or the offer expires or is terminated in accordance with the merger agreement without our having accepted any shares of Pontotoc common stock pursuant to the offer (in each case for reasons other than due to our fault) and Pontotoc enters into an agreement to be acquired by another party within 12 months of the termination of the merger agreement; or

• by us based upon a material willful breach of the merger agreement by Pontotoc.

            In addition, if all the other conditions to the offer have been satisfied and the sole reason for the termination of the merger agreement is Ascent's failure to obtain financing, we will be obligated to pay Pontotoc $2 million as liquidated damages. This obligation is guaranteed by Forman.

Opinion of Pontotoc Financial Advisor (Page 33)

            In deciding to approve the merger, Pontotoc's board of directors considered the opinion of its financial advisor, C.K. Cooper and Company, to the effect that the consideration to be received is fair to the Pontotoc stockholders from a financial point of view.

SELECTED HISTORICAL FINANCIAL DATA
(In thousands, except per share and operating data amounts)

Ascent Energy

            The following table sets forth our selected historical and unaudited pro forma financial data as of the dates and for the periods shown. The historical financial data reflect the business of Forman prior to the Restructuring and is derived from the financial statements of Forman, which have been audited by Arthur Andersen LLP, independent public accountants. You should read the following information with "Management's Discussion and Analysis of Financial Condition and Results of Operations," the audited historical financial statements of Forman and related notes and the Condensed Unaudited Pro Forma Combined Financial Statements and related notes included elsewhere in this prospectus.

		Year Ended December 31,
		2000(1)	1999	1998	1997	1996
Statement of Operations Data:
Oil and natural gas revenue		$ 14,697	$ 12,993	$ 15,950	$ 14,235	$ 10,892
Operating expenses		11,163	12,494	36,691	24,814	8,909
Operating income (loss)		3,534	499	(20,741)	(10,579)	1,983
Interest expense		–	6,244	10,122	7,724	3,983
Other income		263	123	325	474	225
Net income (loss) from operations before             reorganization items, income              taxes and extraordinary items
		3,797	(5,622)	(30,538)	(17,829)	(1,775)
Reorganization items:
Reorganization costs		(899)	(1,184)	–	–	–
Adjust accounts to fair value		–	6,269	–	–	–
Net income (loss) before income taxes and           extraordinary item		2,898	(537)	(30,538)	(17,829)	(1,775)
Provision (benefit) for income taxes		1,182	(188)	–	–	–
Net income (loss) before extraordinary items		1,716	(349)	(30,538)	(17,829)	(1,775)
Extraordinary gain on extinguishment of                debt, net of taxes of $10,089		–	46,724	–	–	–
Net income (loss)		1,716	46,375	(30,538)	(17,829)	(1,775)
Preferred stock dividends		–	(1,153)	(1,729)	(923)	–
Net income (loss) attributed to common shares		$ 1,716	$ 45,222	$(32,267)	$ (18,752)	$ (1,775)
Net income (loss) per share attributable            to common shares before extraordinary item		$ 1.74	$ (16.69)	$ (358.52)	$ (208.36)	$ (19.72)
Extraordinary item per share		–	519.15	–	–	–
Net income (loss) per share		$ 1.74	$ 502.46	$ (358.52)	$ (208.36)	$ (19.72)
Cash Flow Data:
Cash provided by (used in) operating activities	4,050		$ 6,925	$ 5,752	$ 7,853	$ 9,083
Cash provided by (used in) investing activities	(3,325)		(5,219)	(4,570)	(28,527)	(15,394)
Cash provided by financing activities	(177)		–	(165)	21,001	6,128
Balance Sheet Data (at end of period):
Working capital	4,720		1,714	(74,104)	(851)	(5,181)
Oil and gas properties, net	33,775		30,448	23,761	48,228	37,352
Total assets	36,982		35,759	33,686	62,730	42,377
Long–term debt, less current portion	1,310		2,066	17,121	68,014	39,021
Stockholders' equity	22,401		20,685	(56,483)	24,174	(5,032)
Operating Data: Production:
Oil (MBbls)	270		343	393	335	330
Gas (MMcf)	1,797		3,091	4,944	2,613	1,325
Oil and gas (Mmcfe)	3,414		5,154	7,302	4,620	3,306
Average Sales Prices:
Oil (Bbl)	27.49		17.34	12.09	19.72	21.10
Gas (Mcf)	4.05		2.28	2.27	2.92	2.96
Oil and gas (per Mcfe)	4.30		2.52	2.19	3.08	3.30
Average Costs (per Mcfe):
Direct operating expenses	0.98		0.61	0.46	0.59	0.77
General and administrative expenses	0.78		0.59	0.38	0.44	0.47
DD&A	1.31		1.09	1.43	2.03	1.29
Proved Reserves (at the end of period):
Oil (Mbls)	2,667		1,612	1,531	2,260	2,512
Gas (Mmcf)	26,260		18,996	14,558	22,105	23,223
Oil and gas (Mmcfe)	42,264		28,668	23,742	35,664	38,292
Present value of estimated future net cash flows       before income taxes and discounted at 10%	$ 182,313		$ 36,440	$ 19,169	$ 52,256	$ 87,381
Standardized measure of discounted       future net cash flows	$ 113,445		$ 24,403	$ 19,169	$ 52,256	$ 87,381
Unaudited Pro Forma Data: (2)
Operating income (loss) before income taxes					$(17,829)	$ (1,775)
Pro forma benefit (expense) for income taxes         related to operations as an S Corp					6,106	657
Preferred stock dividends					(923)	–
Pro forma net (loss) attributed to common         shares					$ (12,646)	$ (1,118)
Pro forma net (loss) per common share					$ (140.52)	$ (12.42)

_________________

(1)

As a result of the implementation of fresh start accounting, the 1999 financial statements of Forman after consummation of Forman's bankruptcy plan are not comparable to its financial statements of prior periods. The effect of the plan of reorganization and the implementation of fresh start accounting on Forman's balance sheet as of December 31, 1999 are discussed in detail in the notes to the audited consolidated financial statements of Forman appearing elsewhere in this prospectus.

(2)

For all periods presented herein prior to 1997, Forman operated as an S corporation for Federal and state income tax purposes. Upon the issuance of its preferred stock on June 3, 1997, the S corporation election was terminated. The unaudited pro forma data includes the effect of income taxes as if Forman were a C corporation.

Pontotoc

            The following table sets forth selected consolidated historical financial and operating data of Pontotoc as of the dates and for the periods shown. The financial information for the fiscal years ended March 31, 1996 through 2000 is derived from the consolidated financial statements of Pontotoc, which have been audited by Grant Thornton LLP, independent public accountants. The financial information for the nine–month periods ended December 31, 2000 and 1999, is derived from Pontotoc's quarterly reports on Form 10–QSB filed for the periods ended December 31, 2000 and 1999, and is unaudited. You should read this data along with the audited historical financial statements of Pontotoc and related notes and the Condensed Unaudited Pro Forma Combined Financial Statements and related notes included elsewhere in this prospectus.

			Nine Months Ended December 31,		Year Ended March 31,
Statement of Operations Data:			2000	1999	2000	1999	1998	1997	1996
Revenues:
	Production revenues		$ 7,236	$ 3,310	$ 4,833	$ 2,034	$ 1,754	$ 1,082	$ 512
	Other revenues		240	283	355	99	98	151	144
		Total revenues	7,476	3,593	5,188	2,133	1,852	1,233	656
Expenses:
	Direct operating expenses		2,318	1,142	1,533	1,061	784	373	160
	Depreciation, depletion and amortization		655	225	362	221	155	79	47
	Interest expense		480	102	107	148	45	25	11
	General and administrative expenses		448	255	340	320	363	222	140
		Total expenses	3,901	1,724	2,342	1,750	1,347	699	358
Net income (loss) before income taxes			3,575	1,869	2,846	383	505	534	298
Income tax provision (benefit):
	Current		774	550	221	2	127	18	31
	Deferred		397	10	630	97	11	163	73
		Total income taxes	1,171	560	851	99	138	181	104
Net income (loss)			$ 2,404	$ 1,309	$ 1,995	$ 284	$ 367	$ 353	$ 194
Earnings (loss) per common share:
	Basic earnings (loss) per common share		$ 0.46	$ 0.28	$ 0.41	$ 0.06	$ 0.10	$ 0.09	$ 0.05
	Diluted earnings (loss) per common share		$ 0.46	$ 0.27	$ 0.40	$ 0.06	$ 0.10	$ 0.09	$ 0.05
Cash Flow Data:
	Cash provided by (used in) operating activities		$ 3,452	$ 1,765	$ 2,662	$ 529	$ 671	$ 423	$ 323
	Cash provided by (used in) investing activities		$(12,459)	$ (408)	$ (651)	$ (3,679)	$ (687)	$ (661)	$ (180)
	Cash provided by financing activities		$ 7,937	$ (983)	$ (509)	$ 3,302	$ 47	$ 302	$ (120)
Balance Sheet Data (at end of period):
	Working capital		$ 994	$ 445	$ 1,884	$ (1,961)	$ 209	$ 96	$ 42
	Oil and gas properties, net		21,772	5,559	5,816	5,587	1,743	1,181	547
	Total assets		25,072	7,457	8,889	6,440	2,257	1,759	941
	Long–term debt, less current portion		7,791	–	–	–	469	315	26
	Stockholders' equity		9,986	5,467	7,393	3,437	1,243	876	523
Operating Data: Production:
	Oil (MBbls)		218	120	159	137	89	47	25
	Gas (MMcf)		400	471	637	88	44	46	34
	Oil and gas (Mmcfe)		1,708	1,192	1,592	913	582	328	181
Average Sales Prices:
	Oil (per Bbl)		$ 28.67	$ 20.32	$ 22.63	$ 13.37	$ 19.45	$ 21.91	$ 17.45
	Gas (per Mcf)		2.46	1.84	1.76	1.58	1.75	1.96	2.04
	Oil and gas (per Mmcfe)		4.24	2.78	3.04	2.23	3.01	3.30	2.83
Average Costs (per Mmcfe):
	Direct operating expenses		$ 1.36	$ 0.96	$ 0.96	$ 1.16	$ 1.35	$ 1.14	$ 0.88
	General and administrative expenses		0.26	0.21	0.21	0.35	0.62	0.68	0.77
	DD&A		0.39	0.19	0.23	0.24	0.27	0.24	0.26
			Nine Months Ended December 31,		Year Ended March 31,
			2000	1999	2000	1999	1998	1997	1996
Proved Reserves (at the end of period):
Oil (MBbls)			–	–	4,559	4,287	1,526	1,339	950
Gas (MMcf)			–	–	14,880	9,483	478	411	248
Oil and gas (Mmcfe)			–	–	42,234	35,207	9,634	8,446	5,946
Present value of estimated future net cash    flows before income taxes			–	–	$ 63,984	$ 34,566	$ 10,757	$ 11,194	$ 7,875
Standardized measure of discounted    future net cash flows			–	–	$ 42,766	$ 23,134	$ 7,190	$ 7,924	$ 4,796

SELECTED UNAUDITED PRO FORMA COMBINED FINANCIAL DATA

         The following unaudited pro forma combined financial information combines the historical balance sheets and statements of income of Ascent Energy (giving effect to the Restructuring using reorganization accounting for entities under common control) and Pontotoc giving effect to the merger using the purchase method of accounting for business combinations. This information has been prepared to assist you in your analysis of the financial effects of the merger and should be read in conjunction with the unaudited pro forma combined financial information contained on pages 57 – 62 in this prospectus. You should also consider the selected financial data for Ascent Energy and Pontotoc above and the audited historical financial statements and related notes included elsewhere in this prospectus.

         There are several other factors that affect comparisons of the audited historical financial information of Ascent Energy and Pontotoc to the unaudited pro forma combined financial information, including the following:

• The unaudited pro forma combined balance sheet data gives effect to the merger as if it had occurred on December 31, 2000. The unaudited pro forma combined income statement data gives effect to the merger as if it occurred on January 1, 2000.

• Pontotoc's fiscal year ends on March 31. Ascent Energy's fiscal year ends on December 31. The combined company will also utilize December 31 as its fiscal year end. The following pro forma December 31, 2000 selected balance sheet data was derived from Forman's December 31, 2000 balance sheet and Pontotoc's December 31, 2000 balance sheet using the adjustments and assumptions described in the notes to the unaudited pro forma combined financial information. Similarly, the selected pro forma combined income statement data combines the latest similar twelve–month periods reported by Ascent Energy and Pontotoc, using Ascent Energy's fiscal year end of December 31 and adjusting Pontotoc's results to reflect the twelve months ended December 31, 2000.

            The unaudited pro forma information is for illustrative purposes only. If the merger had occurred in the past, the combined company's financial position and operating results might have been different from that presented in the selected unaudited pro forma financial information. You should not rely on the unaudited pro forma information as an indication of the financial position or operating results that the combined company would have achieved if the merger had occurred in the past, nor should you rely on the unaudited pro forma information as an indication of future results that the combined company will achieve after the merger.

			Pro Forma Combined Ascent Energy
Statement of Operations Data:
Revenues:
	Oil and gas sales		$23,550,029
	Other income		589,413
		Total revenues	24,139,442
Expenses:
	Operating expenses		5,534,431
	Depreciation, depletion and amortization		10,971,989
	Production taxes		1,218,035
	General, administrative and other		3,190,405
	Interest expense		2,206,777
	Recapitalization costs		109,130
	Reorganization costs		898,760
	Gas purchases		513,871
		Total expenses	24,643,398
Net income (loss) before income taxes			(503,956)
Provision (benefit) for income taxes			(179,402)
Net income (loss)			(324,554)
	Dividends on preferred stock		(2,752,000)
Net income (loss) attributable to common stockholders			$(3,076,554)
Basic and diluted earnings per share			$(0.66)
Balance Sheet Data (at end of period):
	Working capital (deficit)		(2,278,372)
	Oil and gas properties, net		130,159,902
	Total assets		141,179,033
	Long–term debt, less current portion		31,309,790
	Stockholders' equity		35,701,270
Pro Forma Data:
	Ratio of earnings to preferred dividends		–––(1)

________________

(1)  Due to the pro forma net loss, earnings do not cover preferred dividends by a shortfall of $4.5 million

RISK FACTORS

         You should carefully consider the following factors and other information in this prospectus before deciding whether to exchange your Pontotoc shares for cash and shares of our Series B preferred stock.

Risks Related to the Pontotoc Acquisition

Because we will be a newly combined company with no combined operating history, neither our historical nor our pro forma financial and operating data may be representative of our future results.

            We will be a newly combined company with no combined operating history. Our lack of a combined operating history may make it difficult to forecast our future operating results. The historical financial statements included in this prospectus reflect the separate historical results of operations, financial position and cash flows of Pontotoc and our parent company, Forman. Concurrently with the consummation of the offer, Forman will contribute all of its assets and liabilities to Ascent Energy. The unaudited pro forma financial information included in this prospectus is based on the separate businesses of Pontotoc and Forman. As a result, the historical and pro forma information may not give you an accurate indication of what our actual results would have been if the Restructuring and the Pontotoc acquisition had been completed at the beginning of the periods presented or of what our future results of operations are likely to be. In addition, our future results will depend on our ability to efficiently manage our combined facilities and execute our business strategy.

We may not be able to integrate our operations effectively and efficiently.

            The Restructuring and the Pontotoc acquisition will require the integration of two management teams and operations, a process that we expect to be complex and time–consuming. If we do not successfully integrate the management and operations of Ascent Energy and Pontotoc, or if there is any significant delay in achieving this integration, we may not fully achieve the expected benefits of the Pontotoc acquisition. As a result, our business could suffer.

Our operations have been concentrated in South Louisiana; we will be largely dependent on Pontotoc's management personnel for our oil and gas operations in Oklahoma.

            There is no overlap in the respective oil and gas interests owned by us and Pontotoc. Forman's oil and gas operations are currently concentrated in South Louisiana. Pontotoc's oil and gas properties are primarily located in the State of Oklahoma. Even though we plan to offer employment to Pontotoc's management personnel, we cannot assure you that they will choose to continue to remain employed by us or that we can replace these individuals without experiencing operational delays that may impact future financial performance.

Some of Pontotoc's directors and officers have interests in the offer and the merger that are different from your interests.

            Some of the directors and officers of Pontotoc are parties to agreements, or participate in other arrangements, that give them interests in the offer and the merger that are different from your interests, including:

• James "Robby" Robson, Jr. will become a member of our board of directors on the effective date of the merger and will continue to be employed by Pontotoc;

• each director and executive officer of Pontotoc agreed to tender all outstanding shares of Pontotoc common stock owned by him, which represents a total of 2,023,532 shares or approximately 38% of Pontotoc's outstanding common stock;

• the merger agreement provides for continuing indemnification and insurance coverage for Pontotoc's directors and officers;

• in connection with the merger, holders of Pontotoc's outstanding stock options, including James "Robby" Robson, Jr., Todd Robson and James Robson, Sr., will be entitled to receive a lump sum cash payment equal to the product of the number of Pontotoc shares subject to such stock options times the amount by which $10.50 exceeds the exercise price; and

• As contemplated by the merger agreement, Pontotoc has acquired the remaining 55% ownership interest in Pontotoc Holdings, Inc. from Timothy A. Jurek, a director of Pontotoc, and two other directors of Pontotoc Holdings, for a consideration consisting solely of an aggregate of 110,000 shares of Pontotoc common stock.

            Pontotoc stockholders should consider whether these interests may have influenced those directors and officers to recommend or support the merger. See "The Offer – Interests of Certain Persons in the Offer and the Merger" on page 47.

Significant charges and expenses will be incurred as a result of the merger.

            Ascent Energy and Pontotoc expect to incur approximately $2.2 million of costs related to the merger. These expenses will include investment banking expenses, legal, accounting and other fees, printing expenses, transition and integration costs and other related charges. The companies may also incur additional unanticipated expenses in connection with the merger.

Risks Related to Ownership of Our Series B Preferred Stock

There is no established trading market for either our preferred stock or our common stock.

            Neither our preferred stock nor our common stock issuable upon conversion of our Series B preferred stock will have any established trading market. We do not intend to apply for listing of our preferred stock on any securities exchange or to seek admission thereof to trading on the Nasdaq stock market. As a result there will most likely not be an active public or other market for our preferred stock. Accordingly, holders who may need or wish to dispose of all or part of their preferred stock may be unable to do so except in private, directly negotiated sales. Holders will most likely not be able to liquidate their investment in the event of an emergency or for any other reason. We cannot provide any assurance regarding the liquidity of any market that may develop for our preferred stock, the ability to sell the preferred stock or the price at which a holder will be able to sell the preferred stock. Likewise, there is no active public or other market for our common stock and we cannot guarantee that one will ever develop.

Forman and, indirectly, Forman's significant stockholders will control the outcome of stockholder voting and may exercise this voting power in a manner adverse to you. Two of our directors may have conflicts of interest because they are a managing director and an executive officer of Forman's significant stockholders.

            The TCW Group, Inc., and its affiliates (the "TCW Funds"), and Jefferies & Company, Inc., and its affiliates ("Jefferies"), will be in a position to significantly influence or control the outcome of matters requiring a stockholder vote, including the election of directors, adoption of amendments to our certificate of incorporation or bylaws or approval of mergers and other significant corporate transactions. The interests of the TCW Funds or Jefferies may differ from yours, and the TCW Funds or Jefferies may vote their common stock in a manner that may adversely affect you. In addition, the chairman of our board of directors is a managing director of the TCW Funds and another member of our board of directors is an executive officer of Jefferies. Their duties as a managing director of the TCW Funds and an executive officer of Jefferies may conflict with their duties as directors of our company regarding business dealings between the TCW Funds or Jefferies and us and other matters. The resolution of these conflicts may not always be in our or your best interest.

We have renounced any interest in specified business opportunities, and our significant stockholders and their director nominees on our board of directors generally have no obligation to offer us those opportunities.

            Our certificate of incorporation provides that stockholders who are entitled to cast 25% or more of our total voting power may engage or invest in businesses that compete with ours. Accordingly, significant stockholders may invest in other competing companies. Our certificate of incorporation also provides that we renounce any interest in any such business opportunities.

            Moreover, our certificate of incorporation provides that, if an opportunity in our line of business is presented to a person who is an officer, director or other affiliate of one of our significant stockholders, including any of those individuals who also serves as a director, officer or employee of our company:

• no such officer, director or other affiliate of our significant stockholder has any obligation to communicate or present the opportunity to us; and

• such entity or individual may pursue the opportunity as that entity or individual sees fit, unless it was presented to such individual solely in that person's capacity as a director, officer or employee of our company.

            These provisions of our certificate of incorporation may be amended only by an affirmative vote of holders of at least a majority of our total voting power. As a result of these charter provisions, our future competitive position and growth potential could be adversely affected.

Our parent company recently emerged from bankruptcy.

            In August 1999, our parent company, Forman, sought protection from its creditors under Chapter 11 of the United States Bankruptcy Code of 1986. By order dated December 29, 1999, a joint plan of reorganization with respect to Forman was confirmed by the United States Bankruptcy Court for the Eastern District of Louisiana and Forman emerged from protection under Chapter 11 of the Bankruptcy Code.

Risks Related to Our Business and Operations

Oil and natural gas prices are volatile, and low prices will cause our revenues, profitability and the carrying value of our properties to decrease.

            Our revenues, profitability and the carrying value of our properties depend substantially on prevailing prices for oil and natural gas. Historically, prices for oil and natural gas have been volatile and are likely to continue to be volatile in the future. For example, oil and natural gas prices, while at historically high levels at the present time, declined significantly in 1997 and 1998 and, for an extended period of time, remained substantially below prices obtained in previous years. Among the factors that can cause this volatility are:

• the level of consumer demand;

• domestic and foreign supply of oil and natural gas;

• weather conditions;

• domestic and foreign government regulations and taxes;

• the ability of members of the Organization of Petroleum Exporting Countries to agree to and maintain oil price and production controls;

• political instability or armed conflict in oil or natural gas producing regions;

• the price and level of foreign imports;

• the price and availability of alternative fuels; and

• the overall local and world economic environment.

            Prices for oil and natural gas affect the amount of cash flow available for capital expenditures and our ability to borrow and raise additional capital. The borrowing base under our new bank credit facility will be subject to periodic redetermination based in part on changing expectations of future prices. Lower prices may also reduce the amount of oil and natural gas that we can economically produce. Any substantial and extended decline in the price of oil or natural gas would decrease our cash flows, as well as the carrying value of our proved reserves, our borrowing capacity and our ability to obtain additional capital.

Our capitalization or volatility in our results may prevent us from raising the capital necessary to make acquisitions and drill wells.

            We may not be able to successfully pursue our business strategy if our balance sheet, volatility in our results or general industry or market conditions prevents us from raising the capital required for our acquisition, exploration and development activities and other operations. We expect to make substantial expenditures for the acquisition, exploitation, exploration, development and production of oil and natural gas reserves. If our revenues or cash flow from operations decrease as a result of lower oil and natural gas prices, operating difficulties or other factors, many of which are beyond our control, or we are unable to raise additional debt or equity proceeds to fund such expenditures, then we may curtail our acquisition, drilling, development and other activities. In addition, we may be forced or choose to sell some of our assets on an untimely or unfavorable basis. See "Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources."

We expect to incur additional debt. If we are unable to service this debt or if we are restricted by this debt from engaging in certain activities, we may not be able to successfully pursue our business strategy.

            Our pro forma indebtedness at December 31, 2000, giving effect to the offer and merger, is approximately $32.5 million. Any inability on our part to service our debt will be materially adverse to our business. In addition to the debt we intend to incur in connection with the Pontotoc acquisition, we expect to incur additional debt in the future to fund our capital expenditures. Such additional borrowings may severely restrict our acquisition, exploration and development activities. The borrowing base limitation on our new credit facility will be periodically redetermined based on an evaluation of our reserves. Upon a redetermination, if borrowings in excess of the revised borrowing capacity were outstanding, we could be forced to repay a portion of our bank debt. We may not have sufficient funds to make such repayments and could default under the terms of our indebtedness.

            If our level of borrowings increases, such indebtedness may have several important effects on our operations, including:

• a substantial portion of our cash flow from operations may be dedicated to the payment of interest and principal on our indebtedness and may not be available for other purposes;

• the covenants contained in our bank credit facility may limit our ability to borrow additional funds or to dispose of assets and may affect our flexibility in planning for, and reacting to, changes in business conditions;

• our ability to obtain additional financing in the future for working capital, capital expenditures (including acquisitions), general corporate purposes or other purposes may be impaired;

• our leveraged financial position may make us more vulnerable to economic downturns and may limit our ability to withstand sustained declines in oil and natural gas prices;

• our borrowings will be subject to variable rates, which may make us vulnerable to increases in interest rates; and

• our flexibility in planning for or reacting to changes in market conditions may be limited.

            Moreover, future acquisition or development activities may require us to alter our capitalization significantly. These changes in capitalization may significantly increase our leverage. Our ability to continue to meet our debt service obligations, to reduce total indebtedness and to meet our other obligations will be dependent upon our future performance, which will be subject to general economic conditions, including oil and natural gas prices, and to financial, business and other factors affecting our operations, many of which are beyond our control. If we are unable to generate sufficient cash flow from operations in the future to meet these commitments, we may not be able to satisfy our capital requirements unless we are able to successfully adopt one or more alternatives on a timely basis and with satisfactory terms, such as refinancing or restructuring our indebtedness, selling material assets or operations or seeking to raise additional debt or equity capital. The terms of our indebtedness also may prohibit us from taking such actions. See "Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources –– Bank Credit Facility."

Attractive opportunities to acquire properties with proved undeveloped reserves may not be available, which would prevent us from pursuing our business strategy.

            We may not be able to identify or complete the acquisition of properties with sufficient proved undeveloped reserves to implement our business strategy. Our strategy is based on the acquisition and development of properties with undeveloped discoveries. As we deplete our existing reserves, we must identify, acquire and develop properties through new acquisitions or our level of production and cash flows will be adversely affected. The availability of properties for acquisition depends largely on the divesting practices of other oil and gas companies, commodity prices, general economic conditions and other factors that we cannot control or influence. A substantial decrease in the availability of proved oil and gas properties in our areas of operation, or a substantial increase in their cost to acquire, would adversely affect our ability to replace our reserves as they are depleted.

The oil and gas reserves data and future net revenues estimates we report are uncertain.

            The process of estimating oil and natural gas reserves is a subjective process of estimating underground accumulations of oil and natural gas that cannot be measured in an exact manner. It requires interpretations of available technical data and various assumptions, including assumptions relating to economic and other factors beyond our control. Any significant inaccuracies in these interpretations or assumptions could materially affect the estimated quantities and present value of reserves shown in this prospectus.

            Actual future production, oil and gas prices, revenues, taxes, development costs, operating expenses and quantities of recoverable oil and gas reserves will vary from those currently estimated. Any significant variance could materially affect the estimated quantities and present value of reserves set forth in this document and the information incorporated by reference. Our properties may also be susceptible to hydrocarbon drainage from wells on adjacent properties operated by other owners. In addition, we may adjust reserve estimates to reflect production history, results of exploration and development, availability of rigs and other equipment, prevailing oil and gas prices and other factors, many of which are beyond our control. Actual production, revenues, taxes, development expenditures and operating expenses with respect to our reserves will vary from the estimates used. Such variances may be material.

            You should not assume that the present value of future net cash flows from our or Pontotoc's proved reserves referred to in this prospectus is the current market value of these reserves. In accordance with SEC requirements, we base the estimated discounted future net cash flows from our proved reserves on prices and costs on the date of the estimate. Current commodity prices are at historically high levels. At current prices, we believe the present value of future net revenue amounts included in this prospectus or incorporated herein cannot be construed as the current market value of the estimated oil and gas reserves attributable to our or Pontotoc's properties. Actual future prices and costs are likely to differ materially from those used in the present value estimate because of changes in commodity prices or hedging transactions. The timing of both the production and the expenses from the development and production of oil and gas properties will affect the timing of actual future net cash flows from proved reserves and their present value. In addition, the 10% discount factor, which is required by the SEC to be used in calculating discounted future net cash flows for reporting purposes, is not necessarily the most accurate discount factor. The effective interest rate at various times and the risks associated with us or the oil and gas industry in general will affect the accuracy of the 10% discount factor.

Lower oil and gas prices may cause us to record ceiling test write–downs.

            We use the full cost method of accounting to account for our oil and gas operations. Accordingly, we capitalize the cost to acquire, explore for and develop oil and gas properties. Under full cost accounting rules, the net capitalized costs of oil and gas properties may not exceed a "ceiling limit" which is based upon the present value of estimated future net cash flows from proved reserves at a point in time, discounted at 10%, plus the lower of cost or fair value of unproved properties. If net capitalized costs of oil and gas properties exceed the ceiling limit, we must charge the amount of the excess to earnings. This is called a "ceiling test write–down." This charge does not impact cash flow from operating activities, but does reduce our stockholders' equity. The risk that we will be required to write down the carrying value of oil and gas properties increases when oil and gas prices are low or volatile. In addition, write–downs may occur if we experience substantial downward adjustments to our estimated proved reserves. Due to low oil and gas prices in 1997 and 1998, Forman wrote down its oil and gas properties by $10 million on December 31, 1997, by an additional $12 million on June 30, 1998, and by an additional $7.6 million on December 31, 1998.

Our use of hedging transactions for a portion of our oil and gas production may limit future revenues from price increases and result in significant fluctuations in our stockholders' equity.

            We use hedging transactions with respect to a portion of our oil and gas production to achieve more predictable cash flow and to reduce our exposure to price fluctuations. While the use of hedging transactions limits the downside risk of price declines, their use may also limit future revenues from price increases.

            Pursuant to our commitment letter from Fortis Capital described under "The Offer – Source and Amount of Funds" beginning on page 46, our credit facility will require us to secure hedging arrangements with respect to approximately 50% of our future production through December 2002. In addition, we may enter into hedging arrangements beyond that required under our new credit facility.

            While intended to reduce the effects of volatility of the price of oil and natural gas, such transactions may limit our potential gains if oil and natural gas prices were to rise substantially over the price established by the hedge. In addition, these hedging arrangements may expose us to the risk of financial loss if:

• production is less than expected;

• there is a change in the expected differential between the underlying price in the hedging arrangement and actual prices received;

• the other party to the hedging contract defaults on its contract obligations; or

• a sudden, unexpected event materially affects oil or natural gas prices.

            We adopted Statement of Financial Accounting Standards (SFAS) No. 133 as of January 1, 2001. As a result of adopting SFAS No. 133, our stockholders' equity may fluctuate significantly from period to period. SFAS No. 133 generally requires us to record each derivative instrument as an asset or liability measured at its fair value. We must record an initial adjustment in the other comprehensive income component of stockholders' equity on adoption of SFAS No. 133, which amount will likely be significant. Thereafter, we must similarly record changes in the value of our hedging, which could result in significant fluctuations in stockholders' equity from period to period.

            For further discussion of our hedging arrangements, please see "Management's Discussion and Analysis of Financial Condition and Results of Operations – Quantitative and Qualitative Disclosures About Market Risk."

Exploration is a high–risk activity. The 3–D seismic data and other advanced technologies we use cannot eliminate exploration risk and require experienced technical personnel whom we may be unable to attract or retain.

            Our future success will depend on the success of our future property acquisitions and our drilling operations. Exploitation, exploration and development activities involve numerous risks, including the risk that no commercially productive oil and natural gas reservoirs will be discovered. In addition, we often are uncertain as to the future cost or timing of drilling, completing and producing wells. Furthermore, our drilling operations may be curtailed, delayed or canceled as a result of the additional exploration, time and expenses associated with a variety of factors, including:

• economic conditions;

• unexpected drilling conditions;

• title problems;

• pressure or irregularities in formations;

• equipment failures or accidents;

• adverse weather conditions; and

• shortages or delays in availability of drilling rigs or labor and the delivery of equipment.

            We cannot assure you that wells in which we have an interest will be productive or that we will recover all or any portion of our drilling or other exploratory costs. Drilling for oil and natural gas may be unprofitable. Drilling activities can result in dry holes or in wells that are productive but do not produce sufficient net revenues after drilling, operating and other costs to produce an acceptable return on investment.

            Even when used and properly interpreted, 3–D seismic data and visualization techniques do not allow the interpreter to know conclusively if hydrocarbons are present or economically producible. We could incur losses as a result of these expenditures. Poor results from our exploitation, exploration and development activities could have a material adverse effect on our business, financial condition, cash flows or results of operations.

            Our drilling success will depend, in part, on our ability to attract and retain experienced explorationists and other professional personnel. Competition for explorationists and engineers with experience is intense. If we cannot attract additional experienced personnel, our ability to compete could be adversely affected.

The oil and natural gas business involves many operating risks that can cause substantial losses.

            Our operations are subject to risks inherent in the oil and natural gas business, including:

• fires and explosions;

• blow–outs and surface cratering;

• uncontrollable flows of oil, underground natural gas and formation water;

• natural disasters;

• pipe, cement or pipeline failures or collapses;

• embedded or unremovable oil field drilling and service tools;

• abnormally pressured formations; and

• environmental hazards such as natural gas leaks, oil spills, pipeline ruptures and discharges of toxic natural gases.

            If any of these events occur, we could incur substantial losses as a result of:

• injury or loss of life;

• severe damage to and destruction of property, natural resources and equipment;

• fines and clean–up responsibilities for pollution and other environmental damage; and

• suspension of our operations.

Our insurance coverage may not be sufficient to cover some liabilities or losses that we may incur.

            The occurrence of a significant accident or other event not fully covered by our insurance could have a material adverse effect on our business, financial condition, results of operations or cash flows. Our insurance does not protect us against all operational risks. We do not carry business interruption insurance at levels that would provide enough funds for us to continue operating without access to other funds. For some risks, we may not obtain insurance if we believe the cost of available insurance is excessive relative to the risks presented. Because third party drilling contractors are used to drill our wells, we may not realize the full benefit of workers' compensation laws in dealing with their employees. In addition, pollution and environmental risks generally are not fully insurable.

We may be unable to identify liabilities associated with the properties that we acquire or obtain protection from sellers against them.

            The acquisition of properties requires us to assess a number of factors, including:

• value of the oil or gas properties and likelihood of future production;

• future prices of oil and gas;

• recoverable reserves;

• development and operating costs;

• potential environmental and other liabilities;

• drilling and production difficulties; and

• other factors beyond our control.

            Such assessments are inexact and inherently uncertain. We intend to perform such reviews in a manner that we believe at the time to be generally consistent with industry practice. These reviews, however, may not reveal all existing or potential problems, nor would they permit a buyer to become sufficiently familiar with such properties to assess fully their deficiencies or benefits. For instance, inspections may not be performed on every well, and structural or environmental problems, such as pipeline corrosion, may not be observable even when an inspection is undertaken. In addition, we may not be able to obtain contractual indemnities from the seller for liabilities that it created. We may be required to assume the risk of the physical condition of the properties in addition to the risk that the properties may not perform in accordance with our expectations. We can make no assurance that any future acquisitions will be beneficial. Any unsuccessful acquisition could have a material adverse affect on us.

The marketability of our production depends primarily upon the availability of gathering systems, pipelines and processing facilities.

            Our ability to sell our oil and gas production depends in part upon the availability, proximity and capacity of oil and natural gas gathering systems, pipelines and processing facilities. U.S. federal and state regulation of oil and gas production and transportation, general economic conditions and changes in supply and demand all could adversely affect our ability to produce and market oil and natural gas. If market factors change dramatically, the financial impact on us could be substantial. The availability of markets is beyond our control.

            Pontotoc currently leases a gathering system located in central Oklahoma from Enerfin Resources I Limited Partnership. This gathering system allows Pontotoc to connect with larger pipelines for the purpose of transporting and marketing its oil and gas. Beginning on July 1, 2015, Enerfin Resources may terminate the lease agreement upon 90 days prior notice to any annual renewal by Pontotoc. The termination of this lease agreement would require us to find an alternative way to transport our oil and gas. If an alternative is unavailable, this could have a material adverse effect on us.

The unavailability or high cost of drilling rigs, equipment, supplies, personnel and oilfield services could adversely affect our ability to execute on a timely basis our development plans within our budget.

            Shortages or an increase in cost of drilling rigs, equipment, supplies or personnel could delay or adversely affect our operations. Recently, drilling activity in South Louisiana and Oklahoma has increased, and we have experienced increases in associated costs, including those related to drilling rigs, equipment, supplies and personnel and the services and products of other vendors to the industry. Increased drilling activity also decreases the availability of drilling rigs. These costs may increase further and necessary equipment and services may not be available to us at economical prices.

Competition in our industry is intense, and we are smaller and have a more limited operating history than many of our competitors.

            We compete with major and independent natural gas and oil companies for property acquisitions. We also compete for the equipment and labor required to operate and develop these properties. Many of our competitors have substantially greater financial operations, staffs, facilities and other resources than us. In addition, larger competitors may be able to absorb the burden of any changes in federal, state and local laws and regulations more easily than we can, which would adversely affect our competitive position. These competitors may be able to pay more for natural gas and oil properties and may be able to define, evaluate, bid for and acquire a greater number of properties than we can. Our ability to acquire additional properties and develop new and existing properties in the future will depend on our ability to conduct operations, to evaluate and select suitable properties and to consummate transactions in this highly competitive environment. In addition, some of our competitors have been operating in South Louisiana and Oklahoma for a much longer time than we have and have demonstrated the ability to operate through industry cycles.

We are subject to complex laws and regulations, including environmental regulations that can adversely affect the cost, manner or feasibility of doing business.

            Development, production and sale of natural gas and oil in the U.S. are subject to extensive laws and regulations, including environmental laws and regulations. We may be required to make large expenditures to comply with environmental and other governmental regulations. Matters subject to regulation include:

• discharge permits for drilling operations;

• bonds for ownership, development and production of oil and gas properties;

• unitization and pooling of properties;

• production rates;

• worker safety regulations;

• reports concerning operations; and

• taxation.

            Under these laws and regulations, we could be liable for personal injuries, property damage, oil spills, discharge of hazardous materials, remediation and clean–up costs and other environmental damages. Failure to comply with these laws and regulations also may result in the suspension or termination of our operations and subject us to administrative, civil and criminal penalties. From time to time regulatory agencies have imposed price controls and limitations on production by restricting the rate of flow of oil and natural gas below actual production capacity in order to conserve supplies of oil and natural gas. Moreover, these laws and regulations could change in ways that substantially increase our costs. Accordingly, any of these liabilities, penalties, suspensions, terminations or regulatory changes could materially adversely affect our financial condition and results of operations.

FORWARD–LOOKING STATEMENTS

            This prospectus, including documents referred to, included or incorporated by reference in this prospectus, includes assumptions, expectations, projections, intentions and beliefs about future events. These statements are intended as "forward–looking statements" under the Private Securities Litigation Reform Act of 1995. We caution that assumptions, expectations, projections, intentions and beliefs about future events may and often do vary from actual results and the differences can be material.

            All statements in this document that are not statements of historical fact are forward looking statements. Forward–looking statements include, but are not limited to, such matters as:

• future production;

• operating or financial results;

• statements about pending or recent acquisitions, business strategy, and expected capital spending or operating expenses;

• statements about drilling operations;

• beliefs or assumptions about the outlook for commodity prices;

• expectations regarding the availability of acquisition opportunities; and

• anticipated developments with respect to pending litigation.

            When used in this document the words "anticipate," "estimate," intend," "project," "forecast," "plan," "potential," "will," "may," "should," "continue," "believe," "expect" or similar expressions reflect forward–looking statements.

            These forward–looking statements are subject to risks and uncertainties. All phases of our operations are subject to a number of uncertainties, risks and other influences, many of which are beyond our ability to control or predict. You should understand that various factors, in addition to those discussed elsewhere in this prospectus and in the documents referred to, included or incorporated by reference in this prospectus, could materially affect the results of the combined company following the merger and could cause actual results to differ materially from those expressed in our forward–looking statements, including:

• we are a newly combined company with no combined operating history;

• costs or difficulties related to the integration of our and Pontotoc's businesses;

• oil and natural gas price volatility;

• drilling of wells;

• timing and amount of future production of oil and natural gas;

• operating costs and other expenses;

• cash flow and anticipated liquidity;

• the risks associated with exploration;

• our ability to find, acquire, market, develop and produce new properties;

• uncertainties in the estimation of proved reserves and in the projection of future rates of production and timing of development expenditures;

• operating hazards attendant to the oil and natural gas business;

• downhole drilling and completion risks that are generally not recoverable from third parties or insurance;

• potential mechanical failure or under–performance of significant wells;

• climatic conditions;

• availability and cost of material and equipment;

• our ability to find and retain skilled personnel;

• availability of capital;

• the strength and financial resources of our competitors;

• regulatory developments;

• environmental risks; and

• general economic conditions.

            When you consider these forward–looking statements, you should keep in mind the risk factors and the other cautionary statements in this prospectus. Although we believe our expectations reflected in these forward–looking statements are based on reasonable assumptions, we cannot assure you that these expectations will prove to have been correct. We caution you not to place undue reliance on these forward–looking statements, which speak only as of the date of this prospectus or, in the case of documents incorporated by reference, the dates of those documents.

            All subsequent written and oral forward–looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Except for our ongoing obligations to disclose material information as required by the federal securities laws, we do not have any intention or obligation to update these forward–looking statements after we distribute this prospectus.

COMPARATIVE PER SHARE PRICES AND DIVIDENDS

         There is no public market for Ascent Energy's common shares. Pontotoc common shares have been listed on the Nasdaq National Market since August 31, 2000 and on the Nasdaq Small–Cap Market from December 13, 1999 to August 30, 2000. Prior to that time, Pontotoc's common stock was traded on the over–the–counter market and was quoted on the Nasdaq's OTC Bulletin Board. Pontotoc's ticker symbol is "PNTU." The following table sets forth, for the periods presented, the high and low sales prices for Pontotoc's common shares as reported by the Nasdaq Stock Market since December 13, 1999, and the high and low bid prices for the prior periods.

	Pontotoc Common Shares
Quarter Ended:	High		Low
June 30, 1998		$4.50		$2.1875
September 30, 1998		$4.50		$3.625
December 31, 1998		$3.78125		$1.625
March 31, 1999		$5.375		$3.50
June 30, 1999		$7.19		$5.00
September 30, 1999		$8.50		$6.25
December 31, 1999		$8.06		$6.25
March 31, 2000		$7.50		$6.00
June 30, 2000		$10.00		$6.75
September 30, 2000		$10.063		$9.00
December 31, 2000		$9.813		$8.625
March 31, 2001 (through March 23, 2001)		$10.00		$8.875

            On January 19, 2001, the last full trading day prior to the public announcement of the offer and the merger, the last sale price per Pontotoc common share on the Nasdaq National Market was $9.125. On _____________, 2001, the most recent practicable date prior to the printing of this document, the last sale price per Pontotoc common share was $______. We urge you to obtain current market quotations for Pontotoc common shares before making any decision on the offer.

            As of March 15, 2001, there was one holder of record of Ascent Energy common stock and there were approximately 113 holders of record of Pontotoc common stock. The holders of record does not include stockholders who hold stock in their accounts at broker/dealers.

         Neither Ascent Energy (including Forman) nor Pontotoc has ever declared or paid any cash dividends on our common stock or other securities and neither anticipates paying cash dividends in the foreseeable future. Our credit facility will restrict us from declaring or paying dividends on our common stock without our lenders' consent.

CAPITALIZATION

        The following table sets forth our capitalization as of December 31, 2000:

• on a pro forma basis giving effect to the Restructuring; and

• on a pro forma as adjusted basis to give effect to the sale of our Series A preferred stock and warrants and the consummation of the offer and the merger.

        You should read the table below in conjunction with our unaudited pro forma combined financial statements and related notes and the historical financial statements and related notes included elsewhere in this prospectus.

	At December 31, 2000
	Pro Forma	Pro Forma, As Adjusted
	(Unaudited, in thousands)
Cash and cash equivalents	$ 3,728,332	$                    –––
Long–term debt, including current maturities	2,529,004	32,529,004
8% Series A Redeemable Preferred Stock, $1,000       liquidation preference, 21,100 shares authorized;      no shares outstanding pro forma; 21,100 shares       outstanding pro forma, as adjusted	–––	21,100,000
Stockholders' equity:
Preferred stock, par value $.001 per share, 10,000,000  shares authorized pro forma and pro forma, as adjusted:
8% Series B Convertible Preferred Stock, $2.50 liquidation      preference, 5,500,000 shares authorized; no shares outstanding      pro forma; 5,323,695 shares outstanding pro forma, as adjusted	–––	13,300,000
Common stock, par value $.001 per share, 20,000,000      shares authorized pro forma and pro forma, as adjusted;      4,634,483 shares issued and outstanding pro forma;      4,634,483 shares issued and outstanding     pro forma, as adjusted(1)	4,634	4,634
Additional paid–in capital	20,680,373	20,680,373
Retained earnings	1,716,263	1,716,263
Total stockholders' equity	22,401,270	35,701,270
Total capitalization	$ 28,658,606	$ 89,330,274

___________________

(1) Does not include shares of common stock issuable upon exercise of the stock warrants to be issued or upon conversion of the Series B preferred stock.

REASONS FOR THE OFFER

Reasons For the Offer and the Merger

        We are making the offer in order to acquire all of the outstanding shares of Pontotoc common stock. We intend, as soon as practicable after completion of the offer, to merge Pontotoc Acquisition with Pontotoc. The purpose of the merger is to acquire all Pontotoc shares not tendered and exchanged pursuant to the offer. In the merger, each then outstanding Pontotoc share (except for Pontotoc shares held in Pontotoc's treasury and Pontotoc shares owned by us) would be converted into the right to receive the same amount of cash and number of shares of our Series B preferred stock as is paid in the offer.

        We believe the combined company will have a larger, more diversified asset base. The combined company will have pro forma aggregate proved reserves of approximately 18.9 MMBoe, a 170% increase over what we had on a stand–alone basis at the end of 2000. In addition to our operations in South Louisiana, following completion of the offer and the merger we will have meaningful operations in Oklahoma.

        In addition, we believe the combined company will have more efficient access to capital, at a lower cost, than either Ascent Energy or Pontotoc has individually. We should also have an enhanced ability, as compared with either company on a stand–alone basis, to pursue more acquisitions or other development opportunities.

Reasons For the Pontotoc Board's Recommendation; Factors Considered

        In approving the merger agreement, the offer, the merger and the other transactions contemplated by the merger agreement, and recommending that Pontotoc's stockholders accept the offer and tender their Pontotoc shares pursuant to the offer, the board of directors of Pontotoc considered a number of factors, including:

• The opinion of C.K. Cooper and Company to the effect that, as of January 19, 2001, the consideration to be paid in the offer and the merger pursuant to the merger agreement was fair from a financial point of view to Pontotoc's stockholders. The full text of the written opinion of C.K. Cooper, which sets forth assumptions made, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex B hereto.

• The fact that the consideration and other terms of the merger agreement resulted from arms–length negotiations between Pontotoc and Ascent Energy, and the Pontotoc board of directors' belief that $9.00 in cash plus one share of Ascent Energy Series B preferred stock having a liquidation preference of $2.50 per share for each share of Pontotoc common stock represented the highest per share consideration that could be negotiated with Ascent Energy.

• Pontotoc's financial condition, results of operations and business and strategic objectives, as well as the risks involved in achieving those objectives.

• The significant competition and consolidation in the oil and gas industry, and the relative size of other participants in the oil and gas industry.

• A review of the possible alternatives to the transaction contemplated by the merger agreement, including continuing to operate Pontotoc as an independent entity, a strategic acquisition of another company, a strategic merger with another company in the same industry and a sale or partial sale of Pontotoc through a merger or by other means, and, in respect of each alternative, the timing and the likelihood of actually accomplishing the alternative.

• The financial and valuation analyses presented to the board of directors of Pontotoc by C.K. Cooper and Company, including market prices and financial data relating to other companies engaged in businesses considered comparable to Pontotoc and the prices and premiums paid in recent selected acquisitions of companies engaged in businesses considered comparable to those of Pontotoc.

• The trading history of Pontotoc's common stock, which has been characterized by low daily trading volumes and the resulting illiquidity, typical of companies of similar size.

• The liquidity and certainty of value of the cash consideration to be paid to Pontotoc's stockholders, as well as the receipt of the Ascent Energy Series B preferred stock by the stockholders which will provide the opportunity to retain an equity investment in a more diversified asset base. The Pontotoc board was aware that the cash consideration to be received by Pontotoc's stockholders in the offer and merger would be taxable to such stockholders for federal income tax purposes.

• The commitment by Ascent Energy in the merger agreement to use all reasonable best efforts to consummate the offer and the merger, including its reasonable best efforts to obtain financing for the acquisition.

• The fact that the offer and the merger provide for a prompt exchange offer for all Pontotoc shares to be followed by a second–step merger at the same consideration, thereby enabling Pontotoc's stockholders to obtain the benefits of the transaction at the earliest possible time.

• The financial ability of Ascent Energy to consummate the offer and the merger. In this regard, the Pontotoc board of directors noted that Ascent Energy had received an executed commitment letter from a financial institution providing for a portion of the financing necessary to purchase the Pontotoc shares and to pay transaction fees in connection with the offer and the merger.

• The fact that the merger agreement permits Pontotoc to furnish information to and participate in negotiations with third parties in response to a takeover proposal if a majority of the Pontotoc board of directors:

• reasonably determines, after consultation with Pontotoc's financial advisor, that such takeover proposal constitutes a superior proposal; and  
• determines in good faith, after receiving the advice of outside legal counsel, that it is necessary to take such actions in order to comply with its fiduciary duties under applicable law.

• The fact that the Pontotoc board of directors is permitted to terminate the merger agreement if prior to the purchase of Pontotoc shares pursuant to the offer, a superior proposal is received by Pontotoc and the Pontotoc board of directors reasonably determines in good faith, after receiving the advice of outside legal counsel, that it is necessary to terminate the merger agreement and enter into a new agreement to effect the superior proposal in order to comply with its fiduciary duties under applicable law.

        The foregoing discussion of the information and factors considered by the Pontotoc board of directors is not intended to be exhaustive, but includes the material factors considered by the Pontotoc board of directors. In view of the variety of factors considered in connection with its evaluation of the offer and the merger, the Pontotoc board of directors did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific factors considered in reaching its determination and recommendation. In addition, individual directors may have given differing weights to different factors.

BACKGROUND OF THE OFFER

        The following discussion presents background information concerning the offer and the merger. Information on the actions of Pontotoc's management, the meetings and deliberations of the Pontotoc board of directors and the activities of Pontotoc's advisors has been furnished by Pontotoc.

        Jeffrey Clarke, president of Ascent Energy, and James "Robby" Robson, President and Chief Executive Officer of Pontotoc, first met in June 2000 in connection with a potential investment by Jeffrey Clarke, in his individual capacity, and other private investors in a possible joint venture with Pontotoc for the development of certain of its properties.

        In July and August 2000, after discussions regarding the possible joint venture were abandoned, Jeffrey Clarke had several telephone conversations with Robby Robson and Pontotoc's financial advisor, Cochise Capital Inc., to discuss Pontotoc's interest in considering potential business combination alternatives.

        On August 21, 2000, representatives of Ascent Energy met in Ada, Oklahoma with representatives of Pontotoc, including James "Robby" Robson, to discuss business combination options. After Ascent Energy signed a confidentiality agreement on August 21, 2000, Pontotoc provided Ascent Energy with background information concerning Pontotoc's reserves and other financial matters and agreed to provide Ascent Energy with more information concerning Pontotoc's operations.

        Throughout August and September 2000, Ascent Energy conducted a due diligence review of Pontotoc and its operations.

        In September 2000, Mr. Clarke and Daniel O. Conwill, IV, a representative of Jefferies & Company, Inc., one of Ascent Energy's financial advisors, discussed Ascent Energy's initial bid to acquire Pontotoc with Mr. Robson.

        In October 2000, following continued discussions between senior representatives of Ascent Energy and Pontotoc, the representatives of the parties reached a tentative agreement as to the principal economic terms of the transaction, subject to finalizing Ascent Energy's due diligence, negotiation of a definitive agreement and the approval of each party's board of directors.

        On January 18, 2001, the Pontotoc board of directors held a special meeting to consider the offer, the merger and the merger agreement. Prior to the meeting, C.K. Cooper and Company delivered to Mr. Robson its oral opinion, subsequently confirmed in writing, that, based on matters set forth in its opinion, the consideration to be received by the holders of Pontotoc common stock in the offer and merger pursuant to the merger agreement was fair to such holders, as a group, from a financial point of view. At the special meeting of Pontotoc's board of directors, Mr. Robson reviewed the background of the proposed offer and merger, the terms of the merger agreement and related documents, and the potential benefits of the offer and merger to Pontotoc's stockholders. Mr. Robson then advised the Pontotoc board of the oral opinion delivered by C.K. Cooper and Company. Following discussion, the Pontotoc board unanimously determined that the terms of the offer, the merger and the other transactions contemplated by the merger agreement were advisable and fair to and in the best interests of Pontotoc and its stockholders, approved the merger agreement and the transactions contemplated by the merger agreement, including the offer and the merger, and unanimously recommended that Pontotoc's stockholders accept the offer and tender their shares pursuant to the offer and, if required by applicable law, adopt the merger agreement.

        On January 19, 2001, the board of directors of Ascent Energy approved the merger agreement and the transactions contemplated thereby. The board of directors of Pontotoc Acquisition approved the merger agreement and the transactions contemplated thereby.

        Late in the evening on January 19, 2001, Pontotoc Acquisition, Ascent Energy, and Pontotoc executed and delivered the merger agreement.

        On January 22, 2001, Pontotoc issued a press release announcing the execution and delivery of the merger agreement.

THE OFFER

The Offer

        We are offering to exchange $9.00 in cash and one share of our Series B preferred stock having a liquidation preference equal to $2.50 for each outstanding share of Pontotoc common stock validly tendered and not properly withdrawn, subject to the terms and conditions described in this prospectus and the related letter of transmittal.

        You will not receive any fractional shares of our Series B preferred stock in exchange for your shares of Pontotoc common stock. In lieu of fractional shares, registered holders will receive a number of shares of our Series B preferred stock rounded up to the next whole number (after taking into account all shares of Pontotoc common stock delivered by the record owner).

        The expiration date shall refer to 5:00 p.m., New York City time, on _________, 2001, unless we extend the period of time for which the offer is open, in which case the term expiration date means the latest time and date on which the offer, as so extended, expires.

        If you are the record owner of your shares and you tender your shares directly to the exchange agent, you will not incur any brokerage commissions. If you own your shares through a broker or other nominee, and your broker tenders the shares on your behalf, your broker may charge you a fee for doing so. You should consult your broker or nominee to determine whether any charges will apply. Except as set forth in the instructions to the letter of transmittal, transfer taxes on the Pontotoc common stock pursuant to the offer will be paid by us or on our behalf.

    We are making this offer in order to acquire all of the outstanding shares of Pontotoc common stock. We intend, as soon as possible after completion of the offer, to have Pontotoc Acquisition, the purchaser in the offer, merge with Pontotoc. The purpose of the merger is to acquire all Pontotoc shares not tendered and exchanged pursuant to the offer. In the merger, each then outstanding share of Pontotoc common stock, except for treasury shares of Pontotoc and shares that we hold for our own account, would be converted into the same amount of cash and number of shares of our Series B preferred stock per Pontotoc share as is paid in the offer.

        Our obligation to exchange cash and shares of our Series B preferred stock for Pontotoc shares pursuant to the offer is subject to several conditions referred to below under "Conditions of Our Offer," including the minimum tender condition and other conditions that are discussed below.

Timing of Our Offer

        Our offer is scheduled to expire at 5:00 p.m., New York City time, on ____________, 2001, but we may extend the offer from time to time as necessary until all the conditions to the offer have been satisfied or, where permissible, waived. We may not extend the offer beyond May 31, 2001, without the consent of Pontotoc.

Extension, Termination and Amendment

        We expressly reserve the right, in our sole discretion (subject to the provisions of the merger agreement), at any time or from time to time, to extend the period of time during which the offer remains open, and we can do so by giving oral or written notice of the extension to the exchange agent. If we decide to extend the offer, we will make an announcement to that effect no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date. Subject to the provisions of the merger agreement, we are not making any assurance that we will exercise our right to extend the offer. During an extension, all Pontotoc shares previously tendered and not properly withdrawn will remain subject to the offer, subject to your right to withdraw your Pontotoc shares. You should read the discussion under the caption "Withdrawal Rights" for more details.

        Subject to the SEC's applicable rules and regulations, we also reserve the right, in our sole discretion, but subject to the provisions of the merger agreement, at any time or from time to time, to delay acceptance for exchange of or, regardless of whether we previously accepted Pontotoc shares for exchange, exchange of any Pontotoc shares pursuant to the offer or to terminate the offer and not accept for exchange or exchange any Pontotoc shares not previously accepted for exchange or exchanged, upon the failure of any of the conditions of the offer to be satisfied. We also reserve our right to waive any condition, other than the minimum tender condition and the conditions relating to the absence of an injunction and the effectiveness of the registration statement for the shares of our Series B preferred stock to be issued in the offer, or otherwise amend the offer in any respect, by giving oral or written notice of the waiver or amendment to the exchange agent and by making a public announcement.

        We intend to request effectiveness of the registration statement filed with the SEC at least five business days before the initial expiration date of the offer, which would mean on or before ___________, 2001. If the registration statement has not been declared effective at the initial expiration of the offer, we intend to extend the offer and publicly announce the extension no later than 9:00 a.m., New York City time, on _____________, 2001.

        We will follow any extension, termination, amendment or delay, as promptly as practicable, with a public announcement. In the case of an extension, any announcement will be issued no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date. Subject to applicable law, including Rules 14d–4(d) and 14d–6(c) under the Exchange Act, which require that any material change in the information published, sent or given to stockholders in connection with the offer be promptly sent to stockholders in a manner reasonably designed to inform stockholders of the change, and without limiting the manner in which we may choose to make any public announcement, we assume no obligation to publish, advertise or otherwise communicate any public announcement other than by making a general release to the public.

        We confirm to you that if we make a material change in the terms of the offer or the information concerning the offer, or if we waive a material condition of the offer, we will extend the offer to the extent required under the Exchange Act. If, prior to the expiration date, we change the percentage of Pontotoc shares being sought or the consideration offered to you, that change will apply to all holders whose Pontotoc shares are accepted for exchange pursuant to the offer. If at the time notice of that change is first published, sent or given to you, the offer is scheduled to expire at any time earlier than the tenth business day from and including the date that the notice is first so published, sent or given, we will extend the offer until the expiration of that ten business day period. For purposes of the offer, a "business day" means any day other than a Saturday, Sunday or federal holiday and consists of the time period from 12:01 a.m. through 12:00 midnight, New York City time.

        We may, although we do not currently intend to, elect to provide a subsequent offering period of three to 20 business days after the acceptance of Pontotoc shares in the offer if the requirements under Exchange Act Rule 14d– 11 have been met. If we elect to provide a subsequent offering period, we will notify you by issuing a press release at least five business days before the expiration of the initial offering period, and we will file that press release with the SEC. You will not have the right to withdraw any Pontotoc shares that you tender in the subsequent offering period.

Exchange of Shares; Delivery of Cash and Our Series B Preferred Stock

        Upon the terms and subject to the conditions of the offer, including, if the offer is extended or amended, the terms and conditions of the extension or amendment, we will accept for exchange, and will exchange, Pontotoc shares validly tendered and not properly withdrawn as promptly as practicable after the expiration date and promptly after they are tendered during any subsequent offering period. In addition, subject to applicable rules of the SEC, we expressly reserve the right to delay acceptance for exchange or the exchange of Pontotoc shares in order to comply with any applicable law. In all cases, exchange of Pontotoc shares tendered and accepted for exchange pursuant to the offer will be made only after timely receipt by the exchange agent of certificates for those Pontotoc shares (or a confirmation of a book–entry transfer of those Pontotoc shares in the exchange agent's account at The Depository Trust Company, which we refer to as the "DTC"), a properly completed and duly executed letter of transmittal or a manually signed facsimile of that document and any other required documents.

        For purposes of the offer, we will be deemed to have accepted for exchange Pontotoc shares validly tendered and not properly withdrawn as, if and when we notify the exchange agent of our acceptance of the tenders of those Pontotoc shares pursuant to the offer. The exchange agent will deliver cash and our Series B preferred stock in exchange for Pontotoc shares pursuant to the offer as soon as practicable after receipt of our notice. The exchange agent will act as our agent for the purpose of receiving cash and our Series B preferred stock and transmitting our Series B preferred stock and cash to you. You will not receive any interest on any cash that we pay you for your Pontotoc shares, even if there is a delay in making the exchange.

        If we do not accept any tendered Pontotoc shares for exchange pursuant to the terms and conditions of the offer for any reason, or if certificates are submitted for more Pontotoc shares than are tendered, we will return certificates for the unexchanged Pontotoc shares to the tendering stockholder or, in the case of Pontotoc shares tendered by book–entry transfer of unexchanged Pontotoc shares into the exchange agent's account at DTC pursuant to the procedures set forth below under the discussion entitled "Procedure for Tendering," those Pontotoc shares will be credited to an account maintained within DTC, as soon as practicable following expiration or termination of the offer.

Fractional Shares of Our Series B Preferred Stock

        We will not issue certificates representing fractional shares of our Series B preferred stock pursuant to the offer. In lieu of fractional shares, registered holders will receive a number of shares of our Series B preferred stock in exchange for shares of Pontotoc common stock rounded up to the next whole number (after taking into account all shares of Pontotoc common stock delivered by you).

Withdrawal Rights

        Your tender of Pontotoc shares pursuant to the offer is irrevocable, except that, other than during a subsequent offering period, Pontotoc shares tendered pursuant to the offer may be withdrawn at any time prior to the expiration date, and, unless we previously accepted them for exchange pursuant to the offer, may also be withdrawn at any time after ____________, 2001. If we elect to provide a subsequent offering period under Exchange Act Rule 14d–11, you will not have the right to withdraw Pontotoc shares that you tender in the subsequent offering period.

        For your withdrawal to be effective, the exchange agent must receive from you a written, telex or facsimile transmission notice of withdrawal at one of its addresses set forth on the back cover of this prospectus, and your notice must include your name, address, social security number, the certificate number(s) and the number of Pontotoc shares to be withdrawn as well as the name of the registered holder, if it is different from that of the person who tendered those Pontotoc shares.

        A financial institution must guarantee all signatures on the notice of withdrawal unless those Pontotoc shares have been tendered for the account of any eligible institution. Most banks, savings and loan associations and brokerage houses are able to provide these signature guarantees for you. The financial institution must be a participant in the Securities Transfer Agents Medallion Program, an "eligible institution." If Pontotoc shares have been tendered pursuant to the procedures for book–entry tender discussed under the caption entitled "Procedure for Tendering," any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn Pontotoc shares and must otherwise comply with DTC's procedures. If certificates have been delivered or otherwise identified to the exchange agent, the name of the registered holder and the serial numbers of the particular certificates evidencing the Pontotoc shares withdrawn must also be furnished to the exchange agent, as stated above, prior to the physical release of the certificates. We will decide all questions as to the form and validity (including time of receipt) of any notice of withdrawal, in our sole discretion, and our decision shall be final and binding.

        Neither we, the exchange agent, the information agent nor any other person will be under any duty to give notification of any defects or irregularities in any notice of withdrawal or will incur any liability for failure to give any notification. Any Pontotoc shares properly withdrawn will be deemed not to have been validly tendered for purposes of the offer. However, you may retender withdrawn Pontotoc shares by following one of the procedures discussed under the captions entitled "Procedure for Tendering" or "Guaranteed Delivery" at any time prior to the expiration date.

Procedure for Tendering

        For you to validly tender Pontotoc shares pursuant to the offer, (a) the enclosed letter of transmittal, properly completed and duly executed (or a manually executed facsimile of that document), along with any required signature guarantees, or an agent's message in connection with a book–entry transfer, and any other required documents, must be transmitted to and received by the exchange agent at one of its addresses set forth on the back cover of this prospectus, and certificates for tendered Pontotoc shares must be received by the exchange agent at one of these addresses or those Pontotoc shares must be tendered pursuant to the procedures for book–entry tender set forth below (and a confirmation of receipt of the tender received, which confirmation we refer to below as a "book–entry confirmation"), in each case before the expiration date, or (b) you must comply with the guaranteed delivery procedures set forth below.

        The term "agent's message" means a message, transmitted by DTC to, and received by, the exchange agent and forming a part of a book–entry confirmation, which states that DTC has received an express acknowledgment from the participant in DTC tendering the Pontotoc shares which are the subject of the book–entry confirmation, that the participant has received and agrees to be bound by the terms of the letter of transmittal and that we may enforce that agreement against the participant.

        The exchange agent will establish accounts with respect to the Pontotoc shares at DTC for purposes of the offer within two business days after the date of this prospectus, and any financial institution that is a participant in DTC may make book–entry delivery of the Pontotoc shares by causing DTC to transfer tendered Pontotoc shares into the exchange agent's account in accordance with DTC's procedure for the transfer. However, although delivery of Pontotoc shares may be effected through book–entry at DTC, the letter of transmittal (or a manually signed facsimile thereof), with any required signature guarantees, or an agent's message in connection with a book–entry transfer, and any other required documents, must, in any case, be transmitted to and received by the exchange agent at one or more of its addresses set forth on the back cover of this prospectus prior to the expiration date, or the guaranteed delivery procedures described below must be followed.

        Signatures on all letters of transmittal must be guaranteed by an eligible institution, except in cases in which Pontotoc shares are tendered either by a registered holder of Pontotoc shares who has not completed the box entitled "Special Issuance Instructions" on the letter of transmittal or for the account of an eligible institution.

        If the certificates for Pontotoc shares are registered in the name of a person other than the person who signs the letter of transmittal, or if certificates for unexchanged Pontotoc shares are to be issued to a person other than the registered holder(s), the certificates must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name or names of the registered owner or owners appear on the certificates, with the signature(s) on the certificates or stock powers guaranteed in the manner we have described above.

        The method of delivery of Pontotoc share certificates and all other required documents, including delivery through DTC, is at your option and risk, and the delivery will be deemed made only when actually received by the exchange agent. If delivery is by mail, we recommend registered mail with return receipt requested, properly insured. In all cases, you should allow sufficient time to ensure timely delivery.

Guaranteed Delivery

        If you wish to tender Pontotoc shares pursuant to the offer and your certificates are not immediately available or you cannot deliver the certificates and all other required documents to the exchange agent prior to the expiration date or cannot complete the procedure for book–entry transfer on a timely basis, your Pontotoc shares may nevertheless be tendered, so long as all of the following conditions are satisfied:

• You make your tender by or through an eligible institution;

• The enclosed notice of guaranteed delivery, properly completed and duly executed, substantially in the form enclosed with this prospectus, is received by the exchange agent as provided below on or prior to the expiration date; and

• The certificates for all tendered Pontotoc shares (or a confirmation of a book–entry transfer of tendered securities into the exchange agent's account at DTC as described above), in proper form for transfer, together with a properly completed and duly executed letter of transmittal (or a manually signed facsimile thereof), with any required signature guarantees (or, in the case of a book–entry transfer, an agent's message) and all other documents required by the letter of transmittal are received by the exchange agent within three Nasdaq trading days after the date of execution of the notice of guaranteed delivery.

        You may deliver the notice of guaranteed delivery by hand or transmit it by facsimile transmission or mail to the exchange agent and you must include a signature guarantee by an eligible institution in the form set forth in that notice.

        In all cases, we will exchange Pontotoc shares tendered and accepted for exchange pursuant to the offer only after timely receipt by the exchange agent of certificates for Pontotoc shares (or timely confirmation of a book–entry transfer of tendered securities into the exchange agent's account at DTC as described above), properly completed and duly executed letter(s) of transmittal (or a manually signed facsimile(s) thereof), or an agent's message in connection with a book–entry transfer, and any other required documents.

        By executing a letter of transmittal as set forth above, you irrevocably appoint our designees as your attorneys–in–fact and proxies, each with full power of substitution, to the full extent of your rights with respect to your Pontotoc shares tendered and accepted for exchange by us and with respect to any and all other Pontotoc shares and other securities (other than the shares of our Series B preferred stock) issued or issuable in respect of the Pontotoc shares. That appointment is effective, and voting rights will be affected, when and only to the extent that we deposit the shares of our Series B preferred stock and cash consideration for Pontotoc shares that you have tendered with the exchange agent. All of these proxies shall be considered coupled with an interest in the tendered Pontotoc shares and therefore shall not be revocable. Upon the effectiveness of the appointment, all prior proxies that you have given will be revoked, and you may not give any subsequent proxies (and, if given, they will not be deemed effective). Our designees will, with respect to the Pontotoc shares for which the appointment is effective, be empowered, among other things, to exercise all of your voting and other rights as they, in their sole discretion, deem proper at any annual, special or adjourned meeting of Pontotoc's stockholders or otherwise. We reserve the right to require that, in order for Pontotoc shares to be deemed validly tendered, immediately upon our exchange of those Pontotoc shares, we must be able to exercise full voting rights with respect to the tendered Pontotoc shares.

        We will determine questions as to the validity, form, eligibility (including time of receipt) and acceptance for exchange of any tender of Pontotoc shares, in our sole discretion, and our determination shall be final and binding. We reserve the absolute right to reject any and all tenders of Pontotoc shares that we determine are not in proper form or the acceptance of or exchange for which may, in the opinion of our counsel, be unlawful. We also reserve the absolute right to waive any of the conditions of the offer (other than the regulatory clearance condition and the conditions relating to the absence of an injunction and the effectiveness of the registration statement for shares of Ascent Energy preferred stock to be issued in the offer), or any defect or irregularity in the tender of any Pontotoc shares. No tender of those Pontotoc shares will be deemed to have been validly made until all defects and irregularities in tenders of those Pontotoc shares have been cured or waived. Neither we, the exchange agent, the information agent nor any other person will be under any duty to give notification of any defects or irregularities in the tender of any Pontotoc shares or will incur any liability for failure to give notification. Our interpretation of the terms and conditions of the offer (including the letter of transmittal and instructions thereto) will be final and binding.

        The tender of Pontotoc shares pursuant to any of the procedures described above will constitute a binding agreement between us and you upon the terms and subject to the conditions of the offer.

Material Federal Income Tax Consequences

        The following discussion summarizes the material United States federal income tax consequences of the offer and the merger to holders of shares of Pontotoc common stock. This discussion is based on the Internal Revenue Code of 1986, as amended (which we refer to as the Code), applicable Treasury regulations, administrative interpretations and court decisions as in effect as of the date of this prospectus, all of which may change, possibly with retroactive effect.

        This discussion of material federal income tax consequences of the offer and the merger is intended to provide only a general summary, and is not a complete analysis or description of all potential federal income tax consequences of the offer and/or the merger. It does not address all aspects of federal income taxation that may be important to a holder of Pontotoc common shares in light of that holder's particular circumstances or to a holder subject to special rules, such as:

• a stockholder who is not a citizen or resident of the United States;

• a financial institution or insurance company;

• a tax–exempt organization;

• a dealer or broker in securities;

• a stockholder who holds his Pontotoc common shares as part of a hedge, appreciated financial position, straddle, constructive sale or conversion transaction; or

• a stockholder who acquired his Pontotoc common shares pursuant to the exercise of options or otherwise as compensation.

        In addition, this discussion does not address any state, local or foreign income tax or non–income tax consequences of the offer and/or the merger. We urge each holder of Pontotoc common shares to consult his own tax advisor to determine the particular federal income tax or other tax consequences to him of participation in the offer or the merger.

        A holder of shares of Pontotoc common stock that receives a combination of our Series B preferred stock and cash in exchange for shares of Pontotoc common stock pursuant to the offer and the merger will realize gain or loss equal to the difference between (a) the sum of the amount of cash received plus the fair market value of our Series B preferred stock (on the date the Pontotoc shares are accepted for exchange or at the effective time of the merger, as the case may be), and (b) that stockholder's adjusted tax basis in the Pontotoc common stock exchanged therefor. The recognized gain or loss will constitute capital gain or loss (assuming you hold your Pontotoc shares as a capital asset). Any capital gain or loss recognized will constitute long–term capital gain or loss if the Pontotoc stockholder's holding period for the Pontotoc common stock exchanged is greater than one year as of the date of exchange or at the effective time of the merger, as the case may be. The shares of our Series B preferred stock received by Pontotoc stockholders in exchange for a share of Pontotoc common stock pursuant to the offer or the merger will have a tax basis equal to their fair market value on the date the Pontotoc shares are accepted for exchange or at the effective time of the merger, as the case may be, and a new holding period beginning on the day following the applicable valuation date.

        The foregoing discussion is intended only as a summary and does not purport to be a complete analysis or listing of all potential federal income tax consequences of the offer and the merger. We urge each holder of Pontotoc common shares to consult his own tax advisor to determine the particular United States federal, state or local or foreign income or other tax consequences to him of participation in the offer or the merger.

Reasons for the Offer; The Merger; Dissenters' Rights

    Reasons. We are making the offer in order to acquire all of the outstanding shares of Pontotoc common stock. We intend, as soon as practicable after completion of the offer, to have Pontotoc Acquisition merge with Pontotoc. The purpose of the merger is to acquire all Pontotoc shares not tendered and exchanged pursuant to the offer. In the merger, each then outstanding Pontotoc share (except for Pontotoc shares held in Pontotoc's treasury and Pontotoc shares owned by us or Pontotoc Acquisition) would be converted into the right to receive the same amount of cash and number of shares of our Series B preferred stock as is paid in the offer.

        Approval of the Merger. Under Section 92A.120 of the Nevada Revised Statutes (the "NRS"), the board of directors of a company and the affirmative vote of the holders of a majority of voting power are required to approve and adopt a merger and a merger agreement (a "long–form merger"). The Pontotoc board of directors has previously approved the merger. Accordingly, if we complete the offer (and the minimum tender condition is satisfied), we would have a sufficient number of Pontotoc shares to approve the merger without the affirmative vote of any other holder of Pontotoc shares. Therefore, unless the merger is consummated in accordance with the short–form merger provisions under the NRS described below (in which case no action by the stockholders of Pontotoc, other than us, will be required to consummate the merger), the only remaining corporate action of Pontotoc will be the approval and adoption of the merger agreement by the affirmative vote of a majority of the voting power of Pontotoc's stockholders.

        Possible Short–Form Merger. Section 92A.180 of the NRS would permit the merger to occur without a vote of Pontotoc's stockholders (a "short–form merger") if we were to acquire at least 90% of the outstanding Pontotoc shares in the offer or otherwise (including as a result of purchases by us during any subsequent offering period). If, however, we do not acquire at least 90% of the then outstanding Pontotoc shares pursuant to the offer or otherwise, and a vote of Pontotoc's stockholders is required under the NRS, a longer period of time will be required to effect the merger.

        Dissenter's Rights. Pontotoc stockholders do not have dissenter's rights in connection with the offer but will be entitled to dissenter's rights in connection with the subsequent merger. If more than two–thirds but less than 90% of the outstanding Pontotoc shares are validly tendered and not properly withdrawn in the offer, we will effect a long–form merger (as described above) as permitted under Section 92A.120 the NRS. However, if at least 90% of the outstanding Pontotoc shares are validly tendered and not properly withdrawn in the offer, we will effect a short–form merger (as described above) as permitted under Section 92A.180 of the NRS. In either case, Pontotoc stockholders who comply with the applicable statutory procedures under Nevada law will be entitled to dissenters' rights. In order to preserve dissenters' rights, Pontotoc stockholders must not tender their shares in the offer and must follow strictly the Nevada law regarding dissenters' rights.

        A Pontotoc stockholder who complies with the provisions of Chapter 92A of the NRS has the right to receive a cash payment for his shares of Pontotoc common stock instead of receiving cash and shares of our Series B preferred stock. The following is a summary of the material provisions of Chapter 92A. It is not intended to be a complete statement of such provisions and is qualified in its entirety by reference to the full text of Chapter 92A, a copy of which is attached to this prospectus as Annex F.

        Stockholders of a Nevada corporation have the right, in certain circumstances, to dissent from certain corporate actions, including the consummation of a plan of merger by a Nevada corporation which requires the approval of such corporation's stockholders. Stockholders who are entitled to dissent are also entitled to obtain payment in the amount of the fair value of their shares.

        Pursuant to NRS Section 92A.410, the notice regarding the stockholder vote to approve the merger must state that the Pontotoc stockholders are or may be entitled to dissenters' rights under NRS Sections 92A.300 to 92A.500 and be accompanied by a copy of those sections. This prospectus constitutes the required notice under this provision. A Pontotoc stockholder who wishes to assert dissenters' rights must:

• deliver to Pontotoc, before the record date for determining Pontotoc stockholders entitled to give consent to the merger in writing without a meeting, written notice of his intent to demand payment for his shares of Pontotoc common stock if the merger is effectuated; and

• not vote his shares in favor of the merger.

A Pontotoc stockholder failing to satisfy these requirements will not be entitled to dissenters' rights under Chapter 92A.

        Pontotoc must send a written dissenters' notice within ten days of effectuation of the merger to all Pontotoc stockholders who satisfied these requirements. The dissenters' notice must include:

• a statement of where the demand for payment is to be sent and where and when certificates for Pontotoc common stock are to be deposited;

• a statement informing the holders of Pontotoc common stock not represented by certificates to what extent the transfer of such shares will be restricted after the demand for payment is received;

• a form for demanding payment that requires the Pontotoc stockholder asserting the dissenters' rights to certify whether or not he acquired beneficial ownership of the shares before the date when the terms of the merger were announced to the news media or the stockholders (the "announcement date");

• a date by which Pontotoc must receive the demand for payment, which may not be less than 30 or more than 60 days after the date the dissenter's notice was delivered; and

• a copy of NRS Sections 92A.300 through 92A.500.

        A Pontotoc stockholder who wishes to obtain payment for his Pontotoc common stock must demand payment, certify whether he acquired beneficial ownership of his Pontotoc common stock before the announcement date, and deposit his certificates, if any, in accordance with the terms of the dissenter's notice. A Pontotoc stockholder for whom dissenters' rights are asserted as to shares not represented by a certificate will retain all other rights of a Pontotoc stockholder until those rights are canceled or modified by the merger. Pontotoc may restrict the transfer of any shares not represented by a certificate from the date the demand for payment is received. Pursuant to NRS Section 92A.440, a Pontotoc stockholder who fails to demand payment or deposit his certificates where required by the dates set forth in the dissenters' notice will not be entitled to payment for his shares as provided under Chapter 92A.

        Within 30 days of receipt of a demand for payment, Pontotoc will pay each dissenter who complied with the requirements set forth in the dissenters' notice the amount that Pontotoc estimates to be the fair market value of his shares, plus accrued interest. The payment must be accompanied by:

• copies of Pontotoc's balance sheet as of the end of a fiscal year ending not more than 16 months before the date of payment, a statement of income for that year, a statement of changes in stockholder's equity for that year and the latest interim financial statements, if any;

• a statement of Pontotoc's estimate of the fair value of the shares;

• an explanation of how the interest was calculated;

• a statement of the dissenter's rights to demand payment under NRS Section 92A.480; and

• a copy of NRS Sections 92A.300 through 92A.500.

        Pursuant to NRS Section 92A.470, Pontotoc may elect to withhold payment from dissenters who become the beneficial owner of their shares on or after the announcement date. After consummation of the merger, however, Pontotoc is required to estimate the fair value of such shares, plus accrued interest, and offer to pay this amount to each dissenter in full satisfaction of his demand. Pontotoc will send this offer with a statement of its estimate of the fair value of the shares, an explanation of how the interest was calculated and a statement of the dissenter's rights to demand payment under NRS Section 92A.480.

        Pursuant to NRS Section 92A.480, a dissenter who believes that the amount paid pursuant to NRS Section 92A.460 or offered pursuant to NRS Section 92A.470 is less than the full value of his shares or that the interest due is incorrectly calculated, may, within 30 days after Pontotoc made or offered payment for his shares, either:

• notify Pontotoc in writing of his own estimate of the fair value of his shares and the amount of interest due and demand payment of his estimate less any payments made under NRS Section 92A.460, or

• reject the offer for payment made by Pontotoc under NRS Section 92A.470 and demand payment of the fair value of his shares and interest due.

        A dissenter waives his right to demand payment unless he makes his demand in writing within 30 days after Pontotoc has made or offered payment for his shares.

        If a demand for payment remains unsettled, Pontotoc shall commence a court proceeding within 60 days after receiving a demand and petition the court to determine the fair value of the shares and accrued interest. All dissenters whose demands remain unsettled would be a party to such a proceeding. Each dissenter is entitled to a judgment for the fair value of his shares, plus accrued interest, less any amount paid pursuant to NRS Section 92A.460. The court would assess the costs of the proceedings against Pontotoc unless the court finds that all or some of the dissenters acted arbitrarily, vexatiously or not in good faith in demanding payment, in which case the court may assess the costs in the amount the court finds equitable against some or all of the dissenters. The court may also assess the fees and expenses of the counsel and experts for the respective parties, in the amount the court finds equitable, against Pontotoc or the dissenters. If Pontotoc does not commence a proceeding within the 60 day period, it must pay each dissenter whose demand remains unsettled the amount demanded.

Conditions of Our Offer

        The offer is subject to a number of conditions, which are described below:

    Minimum Tender Condition

        There must be validly tendered and not properly withdrawn prior to the expiration of the offer a number of Pontotoc shares which, together with the shares, then owned by us and Pontotoc Acquisition (if any), will constitute at least two–thirds of the total number of outstanding Pontotoc shares on a fully diluted basis (as though all options or other securities convertible into or exercisable or exchangeable for Pontotoc shares had been so converted, exercised or exchanged) as of the date that we accept the Pontotoc shares pursuant to the offer. Based on information supplied by Pontotoc, the number of Pontotoc shares needed to satisfy the minimum tender condition would have been approximately 3,550,000 as of March 15, 2001.

    Registration Statement Effectiveness Condition

        The registration statement on Form S–4 of which this prospectus is a part must have become effective under the Securities Act and not be the subject of any stop order or proceedings seeking a stop order.

    Blue Sky Condition

        We must receive all necessary state securities law or "blue sky" authorizations.

    Financing Condition

        We must have obtained the financing contemplated by the commitment letter between Fortis Capital Corp. and us dated as of January 10, 2001. If all the other conditions to the offer have been satisfied and the sole reason for the failure to complete the offer is the failure to obtain financing, we will be obligated to pay Pontotoc $2 million as liquidated damages. This obligation is guaranteed by Forman.

    Reserves Condition

        Pontotoc's total proved reserves must be at least 11.8 MMBoe (million barrels of oil equivalent, with 6 Mcf (thousand cubic feet) of gas being deemed to be a barrel of oil), total proved reserves behind pipe must be at least 2.2 MMBoe and total proved developed producing reserves must be at least 4.8 MMBoe, in each case as reflected in the reserve report as of March 1, 2001, to be prepared by Netherland, Sewell & Associates, Inc. prior to the consummation of the offer.

    Outstanding Debt Condition

        The amount of debt outstanding under Pontotoc's credit facility (net of cash, cash equivalents and amounts used to satisfy margin requirements) immediately prior to the consummation of the offer must be no greater than $6.8 million.

    Other Conditions of the Offer

        The offer is also subject to the conditions that, at the time of acceptance for exchange of Pontotoc shares pursuant to the offer:

(1)	there shall not have been instituted or pending any action or proceeding by any government or governmental authority or agency, before any court or governmental authority or agency, challenging or seeking to make illegal, to delay materially or otherwise directly or indirectly to restrain or prohibit the making of the offer, our or Pontotoc Acquisition's acceptance for payment of or payment for some or all of the Pontotoc shares or the consummation of the merger;
(2)	there shall not have been entered, enacted, promulgated, enforced or issued by any court, government or governmental authority or agency, a judgment, order, decree, statute, law, ordinance, rule or regulation, or any other legal restraint or prohibition preventing the consummation of the offer or making the offer illegal;
(3)	Pontotoc shall not have failed to perform in any material respect any of its covenants, obligations or agreements under the merger agreement so that, overall, the failures would reasonably be expected to have a material adverse effect on Pontotoc;
(4)	the representations and warranties of Pontotoc contained in the merger agreement, disregarding all qualifications and exceptions contained in the merger agreement relating to materiality or material adverse effect or any similar standard or qualification, shall be true at and as of the expiration of the offer as if made at and as of that time, other than representations or warranties that address matters only as of a certain date, which shall be true and correct as of that date, except as would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on Pontotoc; and
(5)	the merger agreement shall not have been terminated in accordance with its terms.

 

        The conditions of the offer described above are solely for our benefit and we may, subject to the terms of the merger agreement, assert them regardless of the circumstances giving rise to any of the conditions, including any action or inaction by us. We may not waive any of these conditions in whole or in part without Pontotoc's prior written consent. The failure by us at any time to exercise any of the foregoing rights shall not be deemed a waiver of that right and each right shall be deemed a continuing right which may be asserted at any time and from time to time. Notwithstanding anything to the contrary in this prospectus, we cannot and will not assert any of the conditions to the offer, other than certain regulatory conditions as, and to the extent, permitted by applicable rules and regulations of the SEC, at any time after the expiration date of the offer. Notwithstanding the fact that we reserve the right to assert the failure of a regulatory condition following acceptance for exchange but prior to exchange in order to delay exchange or cancel our obligation to exchange properly tendered Pontotoc shares, we will either promptly exchange the Pontotoc shares or promptly return the Pontotoc shares.

Regulatory Clearances

        We, Pontotoc Acquisition and Pontotoc have agreed pursuant to the merger agreement to use all reasonable efforts to take whatever actions are required to obtain necessary regulatory approvals with respect to the offer and the merger. Other than the SEC declaring the effectiveness of the registration statement of which this prospectus is a part and the filing of a certificate of merger under the NSR with respect to the merger, we do not believe that any additional material governmental filings are required with respect to the offer and the merger.

Possible Effects of Our Offer

        Reduced Liquidity; Possibly no Longer Included for Quotation. The tender of Pontotoc shares pursuant to the offer will reduce the number of holders of Pontotoc shares and the number of Pontotoc shares that might otherwise trade publicly and could adversely affect the liquidity and market value of the remaining Pontotoc shares held by the public. Pontotoc shares are included for quotation and principally traded on the Nasdaq National Market. Depending on the number of Pontotoc shares acquired pursuant to the offer, following consummation of the offer, Pontotoc shares may no longer meet the requirements of the Nasdaq National Market for continued quotation. The NASD's requirements for continued inclusion in the Nasdaq National Market, among other things, require that an issuer have either:

• At least 750,000 publicly held shares, held by at least 400 stockholders of round lots, with a market value of at least $5 million and net tangible assets of at least $4 million and at least two registered and active market makers for the shares; or

• At least 1,100,000 publicly held shares, held by at least 400 stockholders of round lots, with a market value of at least $15 million and at least four registered and active market markers; and either

–  A market capitalization of at least $50 million; or 

–  Total assets and total revenue of at least $50 million each for the most recently completed fiscal year or two of the last three most recently completed fiscal years.

        The shares might nevertheless continue to be included in the Nasdaq National Market with quotations published in the Nasdaq "additional list" or in one of the "local lists," but if the number of holders of the shares were to fall below 300, the number of publicly held shares were to fall below 500,000 or there were not at least two registered and active market makers for the shares, the NASD's rules provide that the shares would no longer be "qualified" for Nasdaq reporting and the Nasdaq would cease to provide any quotations. Shares held directly or indirectly by directors, officers or beneficial owners of more than 10% of the shares are not considered as being publicly held for this purpose. If, following the closing of the offer, the shares of Pontotoc no longer meet the requirements of the NASD for continued inclusion in the Nasdaq National Market or in any other tier of the Nasdaq and the shares were no longer included in the Nasdaq National Market or in any other tier of the Nasdaq, the market for Pontotoc shares could be adversely affected.

        If the shares no longer meet the requirements of the NASD for continued inclusion in any tier of the Nasdaq, it is possible that the shares would continue to trade in the over–the–counter market and that price quotations would be reported by other sources. The extent of the public market for the Pontotoc shares and the availability of quotations for Pontotoc shares would, however, depend upon the number of holders of shares remaining at that time, the interest in maintaining a market in Pontotoc shares on the part of securities firms, the possible termination of registration of the shares under the Exchange Act, as described below, and other factors. We cannot predict whether the reduction in the number of Pontotoc shares that might otherwise trade publicly would have an adverse or beneficial effect on the market price for, or marketability of, the Pontotoc shares.

        According to Pontotoc, there were, as of March 15, 2001, approximately 5,323,695 Pontotoc common shares outstanding, held by 113 holders of record. The holders of record does not include stockholders who hold stock in their accounts at broker/dealers.

         Status as "Margin Securities." The Pontotoc shares are presently "margin securities" under the regulations of the Federal Reserve Board, which has the effect, among other things, of allowing brokers to extend credit on the collateral of Pontotoc shares. Depending on the factors similar to those described above with respect to market quotations, following consummation of the offer, the Pontotoc shares may no longer constitute "margin securities" for the purposes of the Federal Reserve Board's margin regulations, in which event the Pontotoc shares would not be eligible as collateral for margin loans made by brokers.

        Registration Under the Exchange Act. Pontotoc shares are currently registered under the Exchange Act. Pontotoc can terminate that registration upon application to the SEC if the outstanding shares are not listed on a national securities exchange, quoted on an automated inter–dealer quotation system or if there are fewer than 300 holders of record of Pontotoc shares. Termination of registration of the Pontotoc shares under the Exchange Act would reduce the information that Pontotoc must furnish to its stockholders and to the SEC and would make certain provisions of the Exchange Act, such as the short–swing profit recovery provisions of Section 16(b) and the requirement of furnishing a proxy statement in connection with stockholders meetings pursuant to Section 14(a) and the related requirement of furnishing an annual report to stockholders, no longer applicable with respect to Pontotoc shares. In addition, if Pontotoc shares are no longer registered under the Exchange Act, the requirements of Rule 13e–3 under the Exchange Act with respect to "going–private" transactions would no longer be applicable to Pontotoc. Furthermore, the ability of "affiliates" of Pontotoc and persons holding "restricted securities" of Pontotoc to dispose of these securities pursuant to Rule 144 under the Securities Act may be impaired or eliminated. If registration of the Pontotoc shares under the Exchange Act were terminated, they would no longer be eligible for Nasdaq reporting or for continued inclusion on the Federal Reserve Board's list of "margin securities."

        As described below, upon the consummation of the offer, we intend to merge Pontotoc Acquisition with Pontotoc which will result in us being the sole stockholder of Pontotoc. As a result, we do not foresee the possible effects of the offer described above having a practical impact on Pontotoc stockholders who do not exchange their shares in the offer.

Source and Amount of Funds

        We expect to obtain the funds necessary to finance the offer and the merger partially from our internal resources and also from borrowings under the credit facility described below and the sale of our Series A preferred stock and warrants.

        We have received a commitment letter from Fortis Capital to provide financing that will be, together with our existing cash resources and the proceeds of any sale of Series A preferred stock and warrants, sufficient to consummate the offer and the merger, to pay related costs and expenses and to refinance the existing indebtedness of Pontotoc. This commitment is subject to a number of conditions, including, among other things, completion of satisfactory due diligence by Fortis Capital and the execution of a definitive credit agreement. The offer is conditioned upon obtaining the Fortis Capital financing.

        Pursuant to our commitment letter, Fortis Capital has agreed to structure, arrange, and syndicate a senior secured revolving credit facility with a $40 million aggregate borrowing capacity. The initial borrowing base under the credit facility will be $30 million and will be subject to semi–annual redeterminations based upon a review of our reserves. Fortis Capital, will act as the administrative agent and lead arranger. This credit facility will be used to: 

• finance a portion of the cash consideration to be paid in the Pontotoc acquisition;

• repay the amount of indebtedness under Pontotoc's existing credit facility;

• finance the future acquisition and development of oil and gas properties; and

• for other general corporate purposes.

        Except for the commitment letter and the sale of our Series A preferred stock and warrants, we do not currently have any alternative financing sources in place for the offer or the merger.

Relationships with Pontotoc

            Except as set forth herein, neither we nor, to the best of our knowledge, any of our directors, executive officers or other affiliates has any contract, arrangement, understanding or relationship with any other person with respect to any securities of Pontotoc, including any contract, arrangement, understanding or relationship concerning the transfer or the voting of any such securities, joint ventures, loan or option arrangements, puts or calls, guaranties of loans, guaranties against loss or the giving or withholding of proxies. Except as described herein, there have been no contacts, negotiations or transactions since January 1, 1996, between us or, to the best of our knowledge, any of our directors, executive officers or other affiliates on the one hand, and Pontotoc or its affiliates, on the other hand, concerning a merger, consolidation or acquisition, a tender offer or other acquisition of securities, an election of directors, or a sale or other transfer of a material amount of assets. Neither we nor, to the best of our knowledge, any of our directors, executive officers or other affiliates has since January 1, 1996, had any transaction with Pontotoc or any of its officers, directors or affiliates that would require disclosure under the rules and regulations of the SEC applicable to the offer.

            Neither we nor, to the best of our knowledge, any of our directors, executive officers or other affiliates beneficially owns or has any right to acquire, directly or indirectly, any Pontotoc shares and neither we nor, to the best of our knowledge, any of our directors, executive officers or other affiliates has effected any transaction in the Pontotoc shares during the past 60 days.

Interests of Certain Persons in the Offer and the Merger

            In considering the recommendation of Pontotoc's board of directors with respect to the offer and the merger, you should be aware that some executive officers and directors of Pontotoc have interests in the offer and the merger which will provide them with benefits that are in addition to their interests as a stockholder of Pontotoc generally. Pontotoc's board of directors was aware of the potential conflicts discussed below and considered them in approving the offer and the merger.

            Director Nomination. We have agreed to cause James "Robby" Robson, Jr. to become a member of our board of directors as of the effective time of the merger. Mr. Robson will also be an employee of the surviving corporation in the merger.

            Stockholders' Agreements. As of January 19, 2001, we entered into a stockholders' agreement with each of the directors and executive officers of Pontotoc who hold, in the aggregate, approximately 38% of Pontotoc's outstanding stock. Pursuant to the stockholders' agreement, these Pontotoc stockholders agreed to vote for the merger and to tender their shares of Pontotoc common stock pursuant to and in accordance with the terms of the offer.

            Stock Options. In connection with the merger, holders of Pontotoc's outstanding stock options, including James "Robby" Robson, Jr., Todd Robson and James Robson, Sr., all of whom are directors of Pontotoc, will be entitled to receive a lump sum cash payment equal to the product of the number of Pontotoc shares subject to such options times the amount by which $10.50 exceeds the exercise price of the options.

            Indemnification Arrangements. Under the merger agreement, we have agreed to cause the surviving corporation in the merger to fulfill and honor the obligations of Pontotoc pursuant to indemnification agreements between Pontotoc and its directors and officers as of the effective time of the merger and any indemnification provisions under Pontotoc's articles of incorporation and bylaws as in effect on the date of the merger agreement or at the effective time of the merger.

            The merger agreement also provides that the articles of incorporation and bylaws of the surviving corporation in the merger will contain provisions with respect to exculpation and indemnification that are at least as favorable to the indemnified parties as those contained in the articles of incorporation and bylaws of Pontotoc as in effect on the date of merger agreement, which provisions will not be amended, repealed or otherwise modified for a period of three years from the effective time of the merger in any manner that would adversely affect the rights thereunder of individuals who, immediately prior to the effective time of the merger, were directors, officers, employees or agents of Pontotoc, unless such modification is required by law.

            Insurance. For a period of the lesser of five years from the effective time of the merger or the applicable statute of limitations, we have agreed to either:

• cause the surviving corporation in the merger to maintain directors' and officers' liability insurance for each person covered by Pontotoc's directors' and officers' liability insurance policy on the date of the merger agreement on terms comparable to those applicable to the directors and officers of Pontotoc as of the date of the merger agreement, except that we will be obligated to pay premiums for such insurance only up to 150% of the annual premiums paid by Pontotoc for such coverage as of the date of the merger agreement, or

• if mutually agreed between Pontotoc and us, purchase directors' and officers' liability insurance on terms comparable to those applicable to the directors and officers of Pontotoc covering all periods prior to the effective time of the merger.

            Subsidiary Restructuring. As contemplated by the merger agreement, Pontotoc has acquired the remaining 55% ownership interest in Pontotoc Holdings, Inc. from Timothy A. Jurek, a director of Pontotoc, and two other directors of Pontotoc Holdings, for a consideration consisting solely of an aggregate of 110,000 shares of Pontotoc common stock.

            Financial Advisory Fee. Pontotoc has retained Cochise Capital Inc. to provide certain financial advisory services to Pontotoc in connection with the offer and the merger. Cochise Capital Inc. will receive from Pontotoc compensation in the amount of 1.25% of the aggregate value of the consideration received by the Pontotoc stockholders for these services and will be reimbursed for out–of–pocket expenses. Pontotoc has agreed to pay Cochise Capital Inc. a "termination fee" equal to $250,000 if Pontotoc accepts a competing acquisition proposal that triggers a termination fee payable to Ascent Energy. In addition, Pontotoc has agreed to indemnify Cochise Capital Inc. against certain liabilities and expenses in connection with its services as financial advisor.

            See also "– Fees and Expenses" below.

Accounting Treatment

            The merger of Pontotoc and Pontotoc Acquisition will be accounted for as a "purchase," as that term is used under generally accepted accounting principles, commonly referred to as "GAAP," for accounting and financial reporting purposes. Pontotoc will be treated as the acquired corporation for these purposes. Pontotoc's assets, liabilities and other items will be adjusted to their estimated fair value on the closing date of the merger and combined with the historical book values of the assets and liabilities of Pontotoc Acquisition. Applicable income tax effects of these adjustments will be included as a component of the combined company's deferred tax asset or liability.

            We have prepared the unaudited pro forma financial information contained in this prospectus using the purchase accounting method to account for the offer and the merger. See "Condensed Unaudited Pro Forma Combined Financial Statements" beginning on page 57.

Fees and Expenses

            We have agreed to pay Jeffrey Clarke, our president, a success fee in the amount of 0.5% of the aggregate value of the consideration to be paid in connection with the Pontotoc acquisition. Mr. Clarke did not participate in the board's decision with respect to his compensation in connection with the offer and the merger.

            We have retained Innisfree M&A Incorporated as information agent in connection with the offer. The information agent may contact holders of Pontotoc shares by mail, telephone, facsimile, telegraph and personal interview and may request brokers, dealers and other nominee stockholders to forward material relating to the offer to beneficial owners of Pontotoc shares. We will pay the information agent reasonable and customary compensation for these services in addition to reimbursing the information agent for its reasonable out–of–pocket expenses. We have agreed to indemnify the information agent against certain liabilities and expenses in connection with the offer, including certain liabilities under the U.S. federal securities laws.

            In addition, we have retained Mellon Investor Services LLC as the exchange agent. We will pay the exchange agent reasonable and customary compensation for its services in connection with the offer, will reimburse the exchange agent for its reasonable out–of–pocket expenses and will indemnify the exchange agent against certain liabilities and expenses, including certain liabilities under the U.S. federal securities laws.

            Except as set forth above, we will not pay any fees or commissions to any broker, dealer or other person for soliciting tenders of Pontotoc shares pursuant to the offer. We will reimburse brokers, dealers, commercial banks and trust companies and other nominees, upon request, for customary clerical and mailing expenses incurred by them in forwarding offering materials to their customers.

THE MERGER AGREEMENT AND THE STOCKHOLDERS' AGREEMENT

            The following description of the merger agreement describes the material terms of the agreement but does not purport to describe all the terms of the agreement. The complete text of the merger agreement is attached as Annex A to this prospectus. All stockholders are urged to read the merger agreement in its entirety because it is the legal document that governs the offer and the merger.

The Offer

            Terms of the offer. The merger agreement provides for the commencement by Pontotoc Acquisition of this offer to exchange $9.00 in cash and one share of our Series B preferred stock having a liquidation preference of $2.50 per share for each outstanding share of Pontotoc common stock. For a description of those matters, refer to the discussion under "The Offer."

        The merger agreement prohibits Pontotoc Acquisition and us, without the written consent of Pontotoc, from amending or waiving the minimum tender condition or any other condition to the offer, amending the offer to change the form or amount of consideration to be paid, decreasing the number of shares of Pontotoc common stock sought in the offer, imposing additional conditions to the offer, extending the expiration date of the offer except as described below or making any other change which is adverse to the holders of the shares of Pontotoc common stock.

     Optional Extensions of the offer. We will have the right to extend the offer:

• if any of the conditions to the offer is not satisfied or waived on any scheduled expiration date of the offer, for successive extension periods of not more than 10 business days until all conditions to the offer are satisfied or waived; provided that we may not extend the offer beyond May 31, 2001 without the consent of Pontotoc;

• for any period required by any rule, regulation, interpretation or position of the SEC or its staff applicable to the offer or any period required by applicable law; and

• after acceptance of shares in the initial offering period, as it may be extended, for a further period of time by means of a subsequent offering period not to exceed 10 business days for the purpose of having us and Pontotoc Acquisition collectively own at least 90% of the outstanding shares of Pontotoc common stock.

        Prompt Exchange for Pontotoc Shares after the Closing of the Offer. Subject to the conditions of the offer, Pontotoc Acquisition will accept for payment and pay for, as promptly as practicable after the expiration of the offer, all shares of Pontotoc common stock validly tendered and not properly withdrawn pursuant to the offer.

The Merger

        The Merger. The merger agreement provides that Pontotoc Acquisition will be merged with Pontotoc no later than the second business day following the satisfaction or waiver of the conditions set forth in the merger agreement unless the parties agree to another date. Under the terms of the merger agreement, at the effective time of the merger, each share of Pontotoc common stock will be converted into the right to receive from Pontotoc Acquisition the same per share consideration paid to holders of Pontotoc common stock who exchanged their Pontotoc shares in the offer. Notwithstanding the foregoing, the merger consideration will not be payable in respect of Pontotoc shares held by us, Pontotoc or Pontotoc Acquisition.

        Effective Time of the Merger. The merger will become effective upon the filing of articles of merger with the Secretary of State of the State of Nevada or such later time as is agreed by Pontotoc and us and as is specified in the articles of merger. The filing of the articles of merger will take place as soon as practicable on or after the closing date of the merger.

Pontotoc Board of Directors

        Upon acceptance and payment for at least a majority of the outstanding Pontotoc shares, we will be entitled to designate a number of directors of Pontotoc (rounded up to the next whole number) that equals the product of (1) the number of directors on Pontotoc's board and (2) the percentage that the number of shares that we beneficially own bears to the total number of outstanding shares of Pontotoc common stock. Until the merger has become effective, Pontotoc's board shall include at least two members who were directors of Pontotoc prior to the consummation of the offer. The merger agreement provides that, if our designees are elected to Pontotoc's board of directors prior to the effective time of the merger, the affirmative vote of the continuing Pontotoc directors will be required for Pontotoc to:

• amend or terminate the merger agreement on behalf of Pontotoc;

• waive any rights, benefits or remedies of Pontotoc or holders of Pontotoc common stock under the merger agreement;

• extend the time for performance of our or Pontotoc Acquisition's respective obligations under the merger agreement; or

• approve any other action of Pontotoc which is reasonably likely to adversely affect the interests of holders of Pontotoc common stock, with respect to the transactions contemplated by the merger agreement.

Treatment of Pontotoc Stock Options

        Immediately prior to the effective time of the merger, each outstanding Pontotoc stock option shall be cancelled, and, in lieu thereof, on the closing date of the merger the holder of such option shall receive a single lump sum cash payment from the surviving corporation equal to the product of:

• the total number of shares of Pontotoc common stock previously subject to such stock option; times

• the amount by which $10.50 exceeds the exercise price per share of Pontotoc common stock subject to such option, reduced by any required withholding of taxes.

Covenants and Representations and Warranties

        Reasonable Efforts. The merger agreement provides that we and Pontotoc will use our reasonable efforts to take all actions necessary to close the offer and the merger.

        Conduct of Business. The merger agreement obligates Pontotoc, until the earlier of the termination of the merger agreement or the effective time of the merger, to conduct its operations in the ordinary course of business, consistent with past practices. The merger agreement expressly restricts the ability of Pontotoc to engage in certain material transactions, such as purchases and sales of assets or the sale or redemption of outstanding securities of Pontotoc, without our prior written consent.

        No Solicitation of Alternative Transactions. The merger agreement provides that, except in the circumstances described below, Pontotoc will not directly or indirectly:

• solicit, initiate or knowingly take any action to facilitate or encourage the submission or announcement of, any Acquisition Proposal (as defined below);

• enter into or participate in any discussions or negotiations with, furnish any nonpublic information relating to it or afford access to the business, properties, assets, books or records of Pontotoc to, otherwise cooperate in any way with, or knowingly assist, participate in, facilitate or encourage any effort by any third party that has made an Acquisition Proposal;

• approve, endorse or recommend any Acquisition Proposal; or

• enter into any letter of intent or similar document or any contract, agreement or commitment contemplating or otherwise relating to any Acquisition Proposal.

        However, the merger agreement does provide that in response to an unsolicited Acquisition Proposal that did not result from a breach by Pontotoc of its obligations not to solicit alternative transactions and following delivery to us of notice of the Acquisition Proposal, Pontotoc may:

• participate in discussions or negotiations with or furnish nonpublic information (pursuant to a confidentiality agreement) to any third party that makes a bona fide Acquisition Proposal;

• approve or recommend to its stockholders that Acquisition Proposal pursuant to the Exchange Act;

• withdraw, modify in a manner adverse to us or fail to make a recommendation to its stockholders of the offer and the merger; and/or

• take any action ordered to be taken by Pontotoc by any court of competent jurisdiction;

if, in each case, the Pontotoc board of directors reasonably determines (after consultation with Pontotoc's financial advisor) that the Acquisition Proposal constitutes a Superior Proposal (as defined below) and determines in good faith (after consultation with its outside legal counsel) that it is necessary to take such action(s) in order to satisfy its fiduciary duties under applicable law.

        "Acquisition Proposal" means any offer or proposal by a third party, other than by us, Pontotoc Acquisition or any affiliates thereof, relating to:

• any acquisition or purchase from Pontotoc by any person or group of more than a 15% interest in the outstanding voting securities of Pontotoc or any of its subsidiaries or any tender offer or exchange offer that if consummated would result in any person or group beneficially owning 15% or more of the outstanding voting securities of Pontotoc or any of its subsidiaries or any merger, consolidation, business combination or similar transaction involving Pontotoc pursuant to which the stockholders of Pontotoc immediately preceding that transaction would hold less than 85% of the equity interests in the surviving or resulting entity of that transaction;

• any sale, lease (other than in the ordinary course of business), exchange, transfer, license (other than in the ordinary course of business), acquisition, or disposition of more than 15% of the consolidated assets of Pontotoc; or

• any liquidation or dissolution of Pontotoc.

        "Superior Proposal" means any bona fide, unsolicited written Acquisition Proposal for at least a majority of the outstanding Pontotoc shares on terms that the Pontotoc board of directors determines in good faith by a majority vote, after consultation with its financial advisor and taking into account all the terms and conditions of the Acquisition Proposal, are more favorable to the Pontotoc stockholders than the offer and the merger and which is reasonably capable of being consummated.

        Certain Employee Benefits. The merger agreement provides that employees of Pontotoc will be granted credit for purposes of eligibility, vesting and vacation accrual for all service with Pontotoc under our employee benefit plans, programs, or arrangements in which such employees are eligible to participate. If employees of Pontotoc become eligible to participate in a welfare plan that we contribute to or maintain, we will cause such plan to (1) waive any pre–existing condition exclusions and waiting period limitations for conditions covered under the applicable welfare plan under which employees of Pontotoc participate (but only to the extent corresponding exclusions and limitations were satisfied by such employees under the applicable welfare plans maintained or contributed to by Pontotoc), and (2) credit any deductible or out–of–pocket expenses or offsets (or similar expenses) incurred by the employees and their beneficiaries under such plans during the portion of the calendar year prior to such participation.

        Subsidiary Restructuring. As contemplated by the merger agreement, Pontotoc has acquired the 55% ownership interest in Pontotoc Holdings, Inc. that it did not already own, for a consideration consisting solely of an aggregate of 110,000 shares of Pontotoc common stock.

        Hedging. Pontotoc has agreed to secure hedging arrangements with respect to up to 50% of its oil and gas production for a period of up to two years, to the extent approved by us. Pontotoc is required to secure these hedging arrangements at any time prior to the consummation of the offer.

        Representations and Warranties. The merger agreement contains a number of customary representations and warranties relating to each of the parties and their ability to consummate the offer and the merger. All representations and warranties of each party expire at the effective time of the merger.

Conditions of Our Offer

        See "The Offer – Conditions of Our Offer."

Conditions of the Merger

        The obligations of Pontotoc Acquisition and Pontotoc to consummate the merger are subject to the satisfaction of the following conditions:

• to the extent required by applicable law, the merger agreement shall have been approved and adopted by the Pontotoc stockholders;

• the conditions to the offer shall have been satisfied or waived by Pontotoc Acquisition and Pontotoc Acquisition shall have accepted for exchange and exchanged all of the shares of Pontotoc common stock tendered pursuant to the offer;

• no provision of any applicable law or regulation and no judgment, injunction, order or decree shall prohibit the consummation of the merger; and

• the registration statement to which this prospectus relates shall have be declared effective under the Securities Act and not be the subject of any stop order or proceedings seeking a stop order.

Termination of the Merger Agreement

        Termination by Mutual Agreement. The merger agreement may be terminated at any time prior to the effective time of the merger by mutual written consent of us and Pontotoc.

        Termination by either Ascent Energy or Pontotoc. The merger agreement may be terminated by either us or Pontotoc at any time prior to the effective time of the merger if:

(1) the offer has not been consummated on or before May 31, 2001, unless the failure to consummate the offer is the result of a material breach or failure to fulfill a material obligation of the merger agreement by the party seeking termination;

(2) the offer expires or terminates in accordance with the terms of the merger agreement without us or Pontotoc Acquisition having accepted for exchange any Pontotoc shares, except that we and Pontotoc Acquisition will not be permitted to terminate the merger agreement for this reason if the offer is terminated or expires without Pontotoc shares having been accepted for exchange as a result of a breach by us or Pontotoc Acquisition of the merger agreement;

(3) there shall be any applicable law or regulation that makes consummation of the merger illegal or otherwise prohibited or any judgment, injunction, order or decree which is final and nonappealable prohibiting the consummation of the merger; or

(4) any representation or warranty of the non–terminating party contained in the merger agreement is or becomes inaccurate so that, overall, the inaccuracies would reasonably be expected to have a material adverse effect on the non–terminating party, or the non–terminating party fails to perform any material covenant contained in the merger agreement, if that inaccuracy or failure to perform has not been or is incapable of being cured by the non–terminating party within 30 days following receipt by the non–terminating party of notice from the terminating party of the inaccuracy or failure to perform.

        Termination by Ascent Energy. We may terminate the merger agreement at any time prior to the effective date of the merger agreement if a Triggering Event has occurred. A "Triggering Event" has occurred if:

(1) the Pontotoc board of directors, or any of its committees, approves or recommends to the Pontotoc stockholders any Acquisition Proposal;

(2) the Pontotoc board of directors, or any of its committees, withdraws, or amends or modifies, or proposes or resolves to do so, in any way adverse to us, its recommendation to the Pontotoc stockholders that they accept the offer and approve and adopt the merger agreement and the merger;

(3) Pontotoc fails to include in various documents relating to the offer the recommendation of the Pontotoc board of directors that the Pontotoc stockholders accept the offer and approve and adopt the merger agreement and the merger; or

(4) a tender or exchange offer relating to 30% or more of the Pontotoc shares is commenced by a third party and Pontotoc does not send to its stockholders pursuant to rules under the Exchange Act, within 10 business days of the day that the offer is published, sent or given, a statement that Pontotoc recommends rejection of that tender or exchange offer.

Termination Fees

        Termination Fees Payable by Pontotoc to Ascent Energy. If we terminate the merger agreement as described in paragraph (4) under "Termination of the Merger Agreement –– Termination by either Ascent Energy or Pontotoc" based upon a willful material breach by Pontotoc of the merger agreement prior to the closing of the offer, then Pontotoc shall promptly, but in any event no later than two days after the date of such termination, pay us a fee equal to $3.2 million in immediately available funds.

        If we terminate the merger agreement as described under "Termination of the Merger Agreement – Termination by Ascent Energy" prior to the closing of the offer, then Pontotoc shall promptly, but in any event no later than two days after the date of such termination, pay us a fee equal to $3.2 million in immediately available funds.

        If we terminate the merger agreement as described in paragraph (1) or (2) under "Termination of the Merger Agreement –– Termination by either Ascent Energy or Pontotoc" prior to the closing of the offer, other than a termination:

• by Pontotoc as a result of a breach by us or Pontotoc Acquisition of any of our representations, warranties or obligations under the merger agreement;

• by Pontotoc as a result of the failure of us or Pontotoc Acquisition to fulfill any obligation under the merger agreement, which obligation is primarily within our or Pontotoc Acquisition's control, and such failure is the principal cause of or results in the failure of the offer being consummated; or

• by either Pontotoc or us as a result of the occurrence of any of the matters described in paragraph (1) or (2) under "The Offer – Conditions of Our Offer –– Other Conditions of the Offer," unless such matter occurs as a result of an action, suit or proceeding in which a third party that has made an Acquisition Proposal is a participant or which involves issues arising out of an Acquisition Proposal,

then Pontotoc shall promptly, but in any event no later than two days after the date of such termination, pay us a fee equal to $3.2 million in immediately available funds; provided, that, in the case of such a termination prior to which no triggering event has occurred: (i) such payment shall be made only if (A) prior to the termination of the merger agreement, any Acquisition Proposal shall have been publicly announced or shall have become publicly known and not withdrawn prior to the scheduled expiration date of the offer, and (B) within 12 months following the termination of the merger agreement, a Company Acquisition is consummated, and (ii) such payment shall be made promptly, but in any event no later than two days after the consummation of such Company Acquisition.

        "Company Acquisition" means any of the following transactions (other than the offer and the merger):

• a sale or other disposition by Pontotoc of a business or assets representing 40% or more of the consolidated net revenues, net income or assets of Pontotoc immediately prior to that sale;

• the acquisition by any person or group (including by way of a tender offer or an exchange offer or issuance by Pontotoc), directly or indirectly, of beneficial ownership or a right to acquire beneficial ownership of shares representing 40% or more of any class of equity securities of Pontotoc; or

• a merger, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction involving Pontotoc, other than a transaction in which Pontotoc is the acquiror and in which the current Pontotoc stockholders retain more than 70%, directly or indirectly, of the surviving or successor corporation;

except that a widely distributed offering of Pontotoc common stock will not constitute a Company Acquisition.

        Termination Fees Payable by Ascent Energy to Pontotoc. We will be obligated to pay Pontotoc $2 million within five days after termination of the merger agreement if the reason for the failure to complete the offer is our failure to obtain financing and all other conditions to the offer have been satisfied.

Amendments

        The merger agreement may be amended by execution of an instrument in writing signed on behalf of us and Pontotoc at any time. The merger agreement provides that, if we designate directors of Pontotoc prior to the effective time of the merger, any amendment or termination of the merger agreement by Pontotoc, any extension by Pontotoc of the time for the performance of any of our or Pontotoc Acquisition's obligations or other acts, waiver by Pontotoc of any rights, benefits or remedies of Pontotoc or Pontotoc stockholders under the merger agreement or any other action by Pontotoc which is reasonably likely to adversely affect the interests of the Pontotoc stockholders with respect to the transactions provided for under the merger agreement, will require the concurrence of the Pontotoc directors then in office who were directors of Pontotoc prior to consummation of the offer.

The Stockholders' Agreement

Parties

        As an inducement for us to enter into the merger agreement, immediately prior to the signing of the merger agreement, we entered into the stockholders' agreement with each of the directors and executive officers of Pontotoc.

        The obligations of those stockholders under the stockholders' agreement covers, in the aggregate, 2,023,532 Pontotoc shares, which represented approximately 38% of the outstanding Pontotoc shares as of March 15, 2001.

Agreement to Tender

        Each stockholder who signed the stockholders' agreement agreed to tender in the offer and not withdraw that portion of his shares of Pontotoc covered by the stockholders' agreement.

Voting Agreement

        Each stockholder who signed the stockholders' agreement agreed:

• to vote all Pontotoc shares that such stockholder is entitled to vote at that time in favor of the adoption and approval of the merger agreement and the merger and the other transactions contemplated by the merger agreement; and

• not to vote any Pontotoc shares in favor of the approval of any

–  Acquisition Proposal,

–  reorganization, recapitalization, liquidation or winding up of Pontotoc or any other extraordinary transaction involving Pontotoc,

–  corporate action the consummation of which would frustrate the purposes, or prevent or delay the consummation, of the offer, the merger or any other transaction contemplated by the merger agreement; or

–  other matters relating to, or in connection with, any of the foregoing.

CONDENSED UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

        The following condensed unaudited pro forma combined financial information combines the historical balance sheets and statements of income of Ascent Energy (giving effect to the Restructuring using reorganization accounting for entities under common control) and Pontotoc (giving effect to the merger using the purchase method of accounting for business combinations). This information should be read in conjunction with the audited historical financial statements and related notes included elsewhere in this prospectus.

        There are several other factors that affect comparisons of the audited historical financial information of Ascent Energy and Pontotoc to the unaudited pro forma combined financial information, including the following:

• The unaudited pro forma combined balance sheet data give effect to the merger as if it had occurred on December 31, 2000. The unaudited pro forma combined income statement data give effect to the merger as if it occurred on January 1, 2000.
  
• Pontotoc's fiscal year ends on March 31. Ascent Energy's fiscal year ends on December 31. The combined company will also utilize December 31 as its fiscal year end. The following pro forma December 31, 2000 selected balance sheet data was derived from Forman's December 31, 2000 balance sheet and Pontotoc's December 31, 2000 balance sheet using the adjustments and assumptions described in the notes to the unaudited pro forma combined financial information. Similarly, the selected pro forma combined income statement data combines the latest similar twelve–month periods reported by Ascent Energy and Pontotoc, using Ascent Energy's fiscal year end of December 31 and adjusting Pontotoc's results to reflect the twelve months ended December 31, 2000.

        The unaudited pro forma information is for illustrative purposes only. If the merger had occurred in the past, the combined company's financial position and operating results might have been different from those presented in the selected unaudited pro forma financial information. You should not rely on the unaudited pro forma information as an indication of the financial position or operating results that the combined company would have achieved if the merger had occurred in the past, nor should you rely on the unaudited pro forma information as an indication of future results that the combined company will achieve after the merger

CONDENSED UNAUDITED PRO FORMA COMBINED BALANCE SHEETS

	Historical
	Forman As of December 31, 2000	Pontotoc As of December 31, 2000	Pontotoc Gathering As of December 31, 2000	Ascent Energy As of January 19, 2001	Pro Forma Adjustments		Pro Forma Combined Ascent Energy
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$ 3,728,332	$   704,892	$ 46,529	$ –––	$ (4,479,753)	(1)	$             –––
Accounts receivable	2,730,197	1,452,385	74,302	–––	(959,602)	(2)(15)	3,297,282
Deferred taxes –– current	371,778	–––	–––	–––	(371,778)	(3)	–––
Prepaid expenses and other current        assets	373,158	235,734	1,594	–––	238,672	(2)	849,158
Total current assets	7,203,465	2,393,011	122,425	–––			4,146,440
PROPERTY AND EQUIPMENT:
Oil and gas properties, net	23,997,297	21,772,081	–––	–––	84,390,524	(4)	130,159,902
Unevaluated oil and gas properties	5,006,197	–––	–––	–––			5,006,197
Other property and equipment	287,524	740,871	276,943	–––			1,305,338
Other assets, net	487,783	166,518	–––	–––	(93,145)	(5)	561,156
Total assets	36,982,266	25,072,481	399,368	–––			141,179,033
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued liabilities	$ 1,263,784	$ 561,956	$ 192,379	–––	2,722,036	(1)(15)	$ 4,740,155
Current portion of debt and          notes payable	1,219,214	–––	–––	–––			1,219,214
Income taxes payable	–––	77,031	–––	–––			77,031
Deferred taxes –– current	–––	760,190	–––		(371,778)	(3)	388,412
Total current liabilities	2,482,998	1,399,177	192,379	–––			6,424,812
Deferred tax liability	10,788,208	5,896,317	–––	–––	29,958,636	(4)	46,643,16
Senior 10% notes payable and          debt, less  current portion	1,309,790	7,790,786	–––	–––	22,209,214	(6)	31,309,790
Total liabilities	14,580,996	15,086,280	192,379	–––			84,377,763
Preferred Stock –– 8% Series A        Manditorily Redeemable,        $.001 par					21,100,000	(7)	21,100,000
STOCKHOLDERS' EQUITY:
Preferred stock 8% Series B        Convertible, $.001 par	–––	–––	–––	–––	13,300,000	(8)	13,300,000
Common stock	20,685,007	521	–––	1	(20,680,895)	(9)	4,634
Additional paid–in capital	–––	4,169,496	269,686	999	16,240,192	(9)	20,680,373
Stock subscriptions	–––	–––	–––	(1,000)	1,000	(9)	–––
Retained earnings	1,716,263	5,816,184	(62,697)	–––	(5,753,487)	(10)	1,716,263
Total stockholders' equity	22,401,270	9,986,201	206,989	–––			35,701,270
TOTAL LIABILITY AND        STOCKHOLDERS' EQUITY	$36,982,266	$ 25,072,481	$ 399,368	$ –––			$ 141,179,033

SEE ACCOMPANYING NOTES TO CONDENSED UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS.

CONDENSED UNAUDITED PRO FORMA COMBINED INCOME STATEMENTS

	Historical
	Forman Year Ended  Dec. 31, 2000	Pontotoc Twelve Months Ended Dec. 31, 2000	Pontotoc Gathering Twelve Months Ended Dec. 31, 2000	Pro forma Adjustments		Pro forma Combined Ascent Energy
Revenues:
Oil and gas sales	$ 14,696,688	$ 8,758,885	$ 1,922,367	(1,827,911)	(2)	$ 23,550,029
Other income	263,801	313,008	3,055	9,549	(5)	589,413
Total revenues	14,960,489	9,071,893	1,925,422			24,139,442
Expenses:
Operating expense	3,353,441	2,079,121	340,541	(238,672)	(2)	5,534,431
Depreciation, depletion and    amortization	4,484,364	791,813	83,426	5,612,386	(11)	10,971,989
Production taxes	559,334	630,640	98,581	(70,520)	(2)	1,218,035
General, administration and     other	2,656,765	533,640	–––			3,190,405
Interest	–––	485,171	1,304	1,720,302	(12)	2,206,777
Recapitalization costs	109,130	–––	–––			109,130
Reorganization cost	898,760	–––	–––			898,760
Gas purchases	–––	–––	1,422,800	(908,929)	(2)	513,871
Total expenses	12,061,794	4,520,385	1,946,652			24,643,398
Net income (loss) before   income taxes	2,898,695	4,551,508	(21,230)			(503,956)
Provision (benefit) for    income taxes	1,182,432	1,462,183	–––	(2,824,016)	(13)	(179,402)
Net income (loss)	1,716,263	3,089,325	(21,230)			(324,554)
Dividends on preferred stock	–––	–––	–––	2,752,000	(14)	2,752,000
Net income (loss) attributable   to common stockholders	$ 1,716,263	$ 3,089,325	$ (21,230)			$ (3,076,554)
Net income (loss) per share
Basic	$ 1.74	$ 0.60	–––			$ (0.66)
Diluted	$ 1.74	$ 0.59	–––	(16)		$ (0.66)
Weighted average common   shares outstanding
Basic	984,042	5,171,423	–––			4,634,483
Diluted	984,042	5,201,430	–––	(16)		4,634,483

SEE ACCOMPANYING NOTES TO CONDENSED UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

NOTES TO CONDENSED UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

Basis of Presentation

            The condensed unaudited pro forma combined financial statements combine the historical balance sheets and statements of income of Ascent Energy (giving effect to the Restructuring using reorganization accounting for entities under common control) and Pontotoc (giving effect to the merger using the purchase method of accounting for business combinations). For accounting purposes, Forman will be treated as the acquirer. The historical financial statements will be those of Forman and will include Ascent Energy and Pontotoc subsequent to the merger. The historical results of Pontotoc include its 45% interest in Pontotoc Holdings, Inc. ("Holdings"), the holding company for Pontotoc Gathering, LLC ("Gathering"), using the equity method of accounting. On March 1, 2001 Pontotoc acquired the remaining 55% of interest in Holdings from a Director of Pontotoc and two directors of Holdings in exchange for 110,000 shares of Pontotoc common stock, making Holdings a consolidated entity for financial reporting purposes. The accompanying condensed unaudited pro forma combined balance sheet is presented as if the merger and acquisition of Gathering was effective as of December 31, 2000.

            The condensed unaudited pro forma combined statements of operations are presented as if the Pontotoc merger was effective as of January 1, 2000. Under the terms of the merger agreement, Ascent Energy will pay $9.00 in cash and one share of Ascent Energy Series B preferred stock having a liquidation preference of $2.50 per share for each outstanding share of Pontotoc common stock and $508,888 to redeem outstanding options. For pro forma purposes, the estimated fair value of the Series B preferred stock is $2.50 per share. The Series B preferred stock will be convertible into 10% of the outstanding common stock of Ascent Energy on a fully–diluted basis at the option of the holder up to two years from the date of issuance, unless previously redeemed. The Series B preferred stock is redeemable at the option of the issuer at any time at a redemption price of $2.50 per share plus accrued, unpaid dividends, and is mandatorily convertible upon two years from the date of issuance.

            In the opinion of management, these pro forma combined financial statements include all adjustments necessary for a fair presentation of the condensed unaudited pro forma combined financial statements. Accounting policies used in the preparation of the pro forma statements are those disclosed in the Forman and Pontotoc historical consolidated financial statements, which are incorporated by reference herein. The condensed unaudited pro forma combined financial statements are not necessarily indicative either of the results that actually would have been achieved if the transactions reflected therein had been effective during the periods presented or of the results that may be obtained in the future. In preparing these pro forma statements, no adjustments have been made to reflect transactions that have occurred since the dates of the pro forma financial statements except with respect to the acquisition of Gathering. The condensed unaudited pro forma combined financial statements should be read in conjunction with the description of the merger elsewhere in this document, the historical financial statements and related notes of Pontotoc, incorporated by reference in this document, and the historical financial statements and related notes of Forman, included elsewhere in this document.

Pro Forma Adjustments

            The condensed unaudited pro forma combined financial statements give effect to the following assumptions and adjustments:

1. Cost of the offer and the merger not funded from the proceeds of the Series A preferred stock and warrants and the new senior debt, including offer and merger related expenses of $2.2 million (substantially all of which are considered to be associated with the acquisition of Pontotoc).
   
   
2. To record the reversal of production in inventory and related costs at the end of the period of $848,462 and $238,672, respectively, and eliminate affiliate sales to Gathering of $979,449 and production taxes of $70,520.
   
   
3. To reclassify deferred tax assets to reflect current deferred taxes on a net basis.
   
   
4. To record the purchase accounting adjustments for the acquisition of Pontotoc and Gathering.
   
   
5. To record the reversal of equity method 45% investment in Gathering and the related equity in income of Gathering.
   
   
6. To record secured borrowing of $30,000,000 to pay a portion of Pontotoc $9.00 per share cash acquisition price, net of pay–down of Pontotoc debt of $7,790,786.
   
   
7. To record the issuance of the 8% Series A Redeemable Preferred Stock.  Because the Series A preferred stock and the warrants will be offered to all existing stockholders of Forman on a pro rata basis, no value has been attributed to the warrants.
   
   
8. To record the issuance of the 8% Series B Convertible Preferred Stock.
   
   
9. To record the recapitalization of entities to Ascent Energy's equity structure.
   
   
10. To eliminate the retained earnings of those entities acquired for accounting purposes.
    
    
11. To adjust the provision for depreciation, depletion and amortization based on the pro forma consolidated full cost pool, using the future gross revenue method.
    
    
12. Increase in interest resulting from increased debt balance, net of additional capitalized interest of $567,857.
    
    
13. To adjust the effective tax rate for the pro forma combined tax provision at the combined rate of 35.6%.
    
    
14. To record dividends on preferred stock.
    
    
15. Eliminate affiliated accounts receivable and accounts payable balances between Pontotoc and Gathering of $111,140.
    
    
16. Warrants to purchase approximately 4.4 million shares of common stock at an exercise price per share to be determined by Ascent Energy's board of directors and 1 million shares of common stock issuable upon conversion of the Series B preferred stock were not included in the computation of diluted earnings per share because the effect of the assumed exercise of these stock warrants and conversion of these preferred shares as of the beginning of the year would have been antidilutive.

     Pontotoc maintains its accounting records and reports financial information on a March 31 fiscal year basis. The condensed unaudited pro forma calendar year results of operations for Pontotoc were derived from its previously filed reports as follows:

		Pontotoc Year ended March 31, 2000	Less: Pontotoc Nine months ended December 31, 1999	Add: Pontotoc Nine months ended December 31, 2000	Pontotoc Year ended December 31, 2000
Revenues:
	Oil and gas sales	$ 4,832,805	$ 3,309,977	$ 7,236,057	$ 8,758,885
	Other income	355,601	283,196	240,603	313,008
	Total revenues	5,188,406	3,593,173	7,476,660	9,071,893
Expenses:
	Lease operating expense	1,533,360	1,141,843	2,318,244	2,709,761
	Depreciation, depletion and amortization	361,552	225,100	655,361	791,813
	General, administration and other	340,522	255,063	448,181	533,640
	Interest	107,146	101,533	479,558	485,171
	Total expenses	2,342,580	1,723,539	3,901,344	4,520,385
Net income before income taxes		2,845,826	1,869,634	3,575,316	4,551,508
	Provision for income taxes	851,066	560,274	1,171,391	1,462,183
Net income		$ 1,994,760	$ 1,309,360	$ 2,403,925	$ 3,089,325

Adjustments to reflect net income per weighted average common share outstanding have been calculated based upon the pro forma weighted average number of shares outstanding during the period presented. To compute the combined pro forma basic and diluted net income per share, Ascent Energy's historical weighted average number of basic and diluted shares outstanding were used.

ASCENT ENERGY'S BUSINESS AND PROPERTIES

            We are an independent oil and gas company engaged in the acquisition, exploitation, exploration, development, and production of natural gas and crude oil. Through our parent company, Forman Petroleum Corporation, we have been active in South Louisiana since 1982. We have established extensive technical and operating experience in this area and plan to expand our scope of operations to include the Gulf coast, mid–continent and Permian basins and offshore in the Gulf of Mexico. We recently have entered into the merger agreement with Pontotoc to expand our business to include Oklahoma. Following the acquisition of Pontotoc we intend to focus on developing and expanding shallow natural gas reserves in and around Pontotoc's existing Oklahoma properties and exploitation activities on our existing Louisiana properties. We plan to commence a drilling and recompletion program on the existing Oklahoma properties. In addition, we plan to add to the gathering system currently leased under a long term contract by Pontotoc by purchasing and/or leasing additional segments. With respect to our Louisiana properties, we plan to continue recompletion and workover activities during 2001. Our management team has extensive engineering, geological, geophysical, technical and operating experience in successfully developing and operating properties in both our current and planned areas of operations.

            As a result of the implementation of fresh start accounting, the 1999 financial statements of Forman after consummation of the bankruptcy plan are not comparable to its financial statements of prior periods. The effect of the plan of reorganization and the implementation of fresh start accounting on Forman's balance sheet as of December 31, 1999 are discussed in detail in the notes to the audited consolidated financial statements of Forman appearing elsewhere in this prospectus.

Significant Properties

            We have summarized our most significant properties in the tables below.

 

			As of 12/31/00 Net Proved Reserves (1)
Producing Properties	Our Working Interest	Our Net Revenue Interest	MMcfe	% Developed	December 2000 Average Daily Net Production (Mcfe)
Lake Enfermer Field	92.85%	64.75%	20,083	48.55%	4,296
Manilla Village Field	68.64%	51.89%	7,302	68.79%	170
Boutte Field	100.00%	81.50%	11,188	100.00%	4,768
Bayou Fer Blanc Field	100.00%	70.00%	3,690	0.00%	0

__________________

            (1)        Estimates of net proved reserves are based on our third party independent reserve report as of 
                        December 31, 2000.

            Lake Enfermer Field. The Lake Enfermer Field is located in a marsh area on a deep, complexly faulted field, salt structure in Lafourche Parish, Louisiana. Since 1992, we have acquired leases on 3,650 acres in this field and operate the field. The field was first discovered in 1955 and through December 2000 has produced more than 33.5 MMBoe (one million barrels of oil equivalent, determined using the ratio of six Mcf (thousand cubic feet) of natural gas to one barrel of oil).

            Manila Village Field. The Manila Village Field is located in a marsh area in Jefferson Parish, Louisiana. We acquired leases on 825 acres in this field in 1991 and operate the field. The field was first discovered in 1949 and through December 2000 had produced 34.1 MMBoe.

            Boutte Field. The Boutte Field is located in a marsh area in St. Charles Parish, Louisiana. We acquired leases on 3,250 acres in 1992 and operate the field. The field was discovered in 1953 and through December 2000 had produced a total of 39.6 MMBoe.

            Bayou Fer Blanc Field. The Bayou Fer Blanc Field is located in Lafourche Parish, Louisiana next to the Lake Enfermer Field. We purchased our interest in the field in 1997 and operate the field. Although classified as two distinct fields, the Lake Enfermer Field and the Bayou Fer Blanc Field have produced from a single geologic structure. The Bayou Fer Blanc Field was discovered in 1959 and through December 2000 had produced 19.2 MMBoe.

Natural Gas and Oil Reserves

            The following table presents estimated proved reserves as of December 31, 2000, and the related present value of estimated future net revenues before income taxes at such date, as estimated by our independent petroleum engineers, Netherland, Sewell & Associates, Inc. The present values, discounted at 10% per annum, of estimated future net cash flows before income taxes shown on the table are not intended to represent the current market value of our estimated natural gas and oil reserves.

            The present value of future net cash flows before income taxes as of December 31, 2000, was determined using the December 31, 2000, prices of $10.04 per Mcf of natural gas and $25.48 per Bbl of oil.

	Producing	Non–Producing	Undeveloped	Total
Natural gas (MMcf)	5,394	7,410	13,456	26,260
Oil and Condensate (MBbls)	717	1,116	834	2,667
Total proved reserves (Mmcfe)	9,694	14,106	18,462	42,263
Present value of estimated future net revenues   before income taxes, discounted at 10% (in   thousands)	$45,774	$44,297	$92,242	$182,313
Standardized measure of discounted future net   cash flows (in thousands)				$113,445

            These estimates of our proved reserves have not been filed with or included in reports to any federal agency.

            The process of estimating natural gas and oil reserves is a complex and subjective process. It requires various assumptions, including assumptions relating to product prices, operating expenses, capital expenditures, taxes and the availability of funds. We must project production rates and timing of development expenditures. We analyze available geological, geophysical, production and other data, and the extent, quality and reliability of this data will vary. As a result, estimates of different engineers may vary. In addition, estimates of reserves are subject to revision based upon future product prices, actual production, results of future development and exploration activities, operating costs and other factors, and the revisions may be material. Accordingly, reserve estimates will generally be different from the quantities of oil and natural gas that are ultimately recovered. The meaningfulness of such estimates highly depends on the accuracy of the assumptions upon which they are based. Accordingly, the reserve data set forth herein represents only estimates.

            In accordance with applicable SEC requirements, the estimates of our proved reserves and future net revenues are made using oil and natural gas sales prices that are in effect as of the date of such reserve estimates and are held constant throughout the life of the properties. You should not assume that the present value of future net revenues from our proved reserves is the current market value of these reserves. Estimated quantities of proved reserves and future net revenues therefrom are affected significantly by oil and natural gas prices, which have fluctuated widely in recent years. Current commodity prices are at historically high levels. At current prices, we believe of future net revenue amounts included in this prospectus or incorporated herein cannot be construed as the current market value of the oil and gas reserves attributable to our properties. The average prices of oil and gas we have actually received for years 2000, 1999 and 1998 were $27.49, $17.34 and $12.09 respectively, per barrel and $4.05, $2.28 and $2.27, respectively, per Mcf. Oil prices have remained relatively stable and natural gas prices have continued to decline almost 50% subsequent to December 31, 2000. Accordingly, the discounted future net cash flows would be decreased if the standardized measure were calculated at a later date. Actual future prices and costs are likely to differ materially from those used in the present value estimate because of changes in commodity prices or hedging transactions.

Title to Properties

            We believe that we have satisfactory title to all of our producing properties in accordance with standards generally accepted in the oil and natural gas industry, subject to such exceptions as, in our view, do not materially detract from the use or value of the properties. As is customary in the oil and gas industry, we perform only a preliminary title investigation before leasing undeveloped properties. A title opinion is typically obtained before the commencement of drilling operations and any material defects are remedied prior to the time the actual drilling of a well is commenced. If the operator or we were unable to remedy or cure any title defect, we could suffer a loss of our entire investment in the property.

            Our properties are subject to customary royalty interests, liens for current taxes, liens of vendors and other customary burdens, which we do not believe materially interfere with the use of or affect the value of our producing properties. We intend to mortgage all of our producing properties to secure our borrowings to be incurred in connection with the offer and the merger. See "Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources."

Acreage

            The table below summarizes our developed and undeveloped leasehold acreage as of December 31, 2000:

	Developed Acreage		Undeveloped Acreage
Field	Gross	Net	Gross	Net
Lake Enfermer	1,939	1,785	420	414
Manila Village	742	530	0	0
Boutte	3,090	3,090	0	0
Bayou Fer Blanc	0	0	320	320
	5,771	5,405	740	734

         Gross acreage is acreage in which a working interest is owned while a net acre is deemed to exist when the sum of the fractional working interests in gross acres equals one. Undeveloped acreage is considered to be those leased acres on which wells have not been drilled or completed to a point that would permit the production of commercial quantities of oil and natural gas, regardless of whether or not such acreage contains proved reserves. As is customary in the industry, we can retain our interests in undeveloped acreage by drilling activity that establishes commercial production or by payment of delay rentals during the remaining primary term. The oil and natural gas leases in which we have an interest are for varying primary terms; however, most of our developed leased acreage is beyond the primary term and is held by producing wells.

Productive Wells

            The following table sets forth the number of producing wells in which we maintain an ownership interest at December 31, 2000:

	Productive Wells
	Gross	Net
Gas	16.00	13.81
Oil	16.00	13.93
Total	32.00	27.74

Productive wells consist of producing wells and wells capable of production. A gross well is a well in which we maintain a working interest while a net well is deemed to exist when the sum of the fractional working interests owned by us equals one. Wells with multiple completions are counted as one well. Of the gross wells reported in the table, one had multiple completions.

Drilling Activity

            The following table sets forth our drilling activity for the last three years:

		Year Ended December 31,
		2000		1999		1998
		Gross	Net	Gross	Net	Gross	Net
Development wells:
	Productive	0.0	0.0	1.0	1.0	0.0	0.0
	Non–productive	0.0	0.0	0.0	0.0	0.0	0.0
	Total	0.0	0.0	1.0	1.0	0.0	0.0
Exploratory wells:
	Productive	0.0	0.0	0.0	0.0	0.0	0.0
	Non–productive	0.0	0.0	1.0	0.5	0.0	0.0
	Total	0.0	0.0	1.0	0.5	0.0	0.0
Total:
	Productive	0.0	0.0	1.0	1.0	0.0	0.0
	Non–productive	0.0	0.0	1.0	0.5	0.0	0.0
	Total	0.0	0.0	2.0	1.5	0.0	0.0

Net Production, Unit Prices and Costs

         The following table presents certain information regarding our production volumes, average sale prices and average production costs for the last three years:

	Year Ended December 31,
	2000	1999	1998
Production:
Natural gas (MMcf)	1,797	3,091	4,944
Oil and condensate (MBbls)	270	343	393
Total (MMcfe)	3,414	5,154	7,302
Average sales price per unit:
Natural gas––
Revenues from production (per Mcf)	$ 4.05	$ 2.28	$ 2.27
Effects of hedging activities (per Mcf)	0	0	0
Average price (per Mcf)	$ 4.05	$ 2.28	$ 2.27
Oil and condensate––
Revenues from production (per Bbl)	$ 27.49	$ 17.34	$ 12.09
Effects of hedging activities (per Bbl)	0	0	0
Average price (per Bbl)	27.49	17.34	12.09
Total revenues from production   (per Mcfe)	$ 4.30	$ 2.52	$ 2.19
Effects of hedging activities (per Mcfe)	0	0	0
Total average price (per Mcfe)	$ 4.30	$ 2.52	$ 2.19
Expenses (per Mcfe):
General and administrative	$ 0.78	$ 0.59	$ 0.38
Lease operating expenses (excluding   Production taxes)	$ 0.98	$ 0.61	$ 0.46
Depreciation, depletion and amortization–   oil and natural gas properties	$ 1.31	$ 1.09	$ 1.43

Capital Expenditures

            The following table presents information regarding our net costs incurred in oil and natural gas property acquisitions, exploration and development activities for the past three years:

 

	Year Ended December 31,
	2000		1999		1998
Property acquisition
Proved	$	574,008	$	81,840	$	0
Unproved	0		0			0
Exploration	1,502,880		3,345,943			2,413,719
Development	46,853		1,745,862			2,118,810
Capitalized general and administrative costs	842,391		0			0
	$	2,966,132	$	5,173,645	$	4,532,529

Oil and Gas Marketing

            We sell our natural gas and oil production under price sensitive or market price contracts. Our revenues, profitability and future growth depend substantially on prevailing prices for natural gas and oil. The price received by us for natural gas and oil production historically has fluctuated widely. Decreases in the price of natural gas and oil could adversely affect the carrying value of our proved reserves and our revenues, profitability and cash flow. From time to time we may enter into transactions hedging the price of oil and natural gas production. See "Management's Discussion and Analysis of Financial Conditions Results of Operations – Quantitative and Qualitative Disclosures About Market Risk."

Competition and Markets

            We operate in a highly competitive environment. We compete with major and independent oil and natural gas companies for the acquisition of desirable oil and natural gas properties, as well as for the equipment and labor required to develop and operate these properties. We also compete with major and independent oil and natural gas companies in the marketing and sale of oil and natural gas to marketers and end–users. Many of our competitors have financial and other resources substantially greater than ours.

            Competitors may be able to pay more for natural gas and oil properties and may be able to define, evaluate, bid for and acquire a greater number of properties than we can. Our ability to acquire and develop additional properties in the future will depend on our ability to conduct operations, evaluate and select suitable properties and close transactions in this highly competitive market environment.

            The marketability of our production depends upon the availability and capacity of gas gathering systems, pipelines and processing facilities, and the unavailability or lack of capacity thereof could result in the shut–in of producing wells or the delay or termination of development plans for properties. In addition, regulatory changes affecting oil and natural gas production and transportation, general economic conditions and changes in supply and demand could adversely affect our ability to produce and market our oil and natural gas on a profitable basis. In addition, larger competitors may be able to absorb the burden of any regulatory changes more easily than we can, which would adversely affect our competitive position.

Regulation

            Our business can be affected by a number of regulatory policies, including the regulation of production, federal and state regulations governing environmental quality and pollution control, state limits of allowable rates of production by a well or proration unit and incentives to promote alternative or competitive fuels. State and federal regulations generally are intended to prevent waste of oil and natural gas, protect rights to produce oil and natural gas between owners in a common reservoir, control the amount of oil and natural gas produced by assigning allowable rates of production and control contamination of the environment. Pipelines are also subject to the jurisdiction of various federal, state and local agencies.

            Federal Regulation of Natural Gas. Federal legislation and regulatory controls in the United States have historically affected the price of natural gas and the manner in which natural gas production is marketed. In the past, the federal government has regulated the price at which natural gas could be sold and could reenact price controls in the future.

            Our sales of natural gas are affected by the availability, terms and cost of pipeline transportation. The price and terms for access to pipeline transportation are subject to extensive federal regulation. Beginning in 1992, the Federal Energy Regulatory Commission issued a series of orders, which required interstate pipelines to provide open–access transportation on a not unduly discriminatory basis for all natural gas shippers. The Federal Energy Regulatory Commission has stated that it intends for these orders and its future restructuring activities to foster increased competition within all phases of the natural gas industry. Although these orders do not directly regulate our production and marketing activities, they do affect how buyers and sellers gain access to the necessary transportation facilities and how we and our competitors sell natural gas.

            The courts have largely affirmed the significant features of the Federal Energy Regulatory Commission's deregulation orders and the numerous related orders pertaining to individual pipelines. However, some appeals remain pending and the Federal Energy Regulatory Commission continues to review and modify its regulations regarding the transportation of natural gas. For example, the Federal Energy Regulatory Commission issued Order No. 637 which:

• lifts the cost–based cap on pipeline transportation rates in the capacity release market until September 30, 2002, for short–term releases of pipeline capacity of less than one year;

• permits pipelines to file for authority to charge different maximum cost–based rates for peak and off–peak periods;

• encourages, but does not mandate, auctions for pipeline capacity;

• requires pipelines to implement imbalance management services;

• restricts the ability of pipelines to impose penalties for imbalances, overruns and non–compliance with operational flow orders; and

• implements a number of new pipeline reporting requirements.

            Order No. 637 also requires the Federal Energy Regulatory Commission's staff to analyze whether the Federal Energy Regulatory Commission should implement additional fundamental policy changes. These include whether to pursue performance–based or other non–cost based ratemaking techniques and whether the Federal Energy Regulatory Commission should mandate greater standardization in terms and conditions of service across the interstate pipeline grid.

            We cannot predict what other actions the Federal Energy Regulatory Commission will take on these matters, nor can we accurately predict whether the Federal Energy Regulatory Commission's actions will achieve the goal of increasing competition in markets in which our natural gas is sold. However, we do not believe that any action taken will affect us in a way that materially differs from the way it affects other natural gas producers, gatherers and marketers.

            Oil Sales and Transportation Rates. Sales prices of crude oil and natural gas liquids by us are not regulated. The price we receive from the sale of these products may be affected by the cost of transporting the products to market. In a number of instances, however, the ability to transport and sell these products depends on pipelines whose rates, terms and conditions of service are subject to Federal Energy Regulatory Commission jurisdiction. In other instances, the ability to transport and sell our products depends on pipelines whose rates, terms and conditions of service are subject to regulation by state regulatory bodies. Certain regulations implemented by the Federal Energy Regulatory Commission in recent years could result in an increase in the cost of transportation service on these pipelines. However, we do not believe that these regulations affect us any differently than any other producer or marketer.

            Environmental Matters. Extensive federal, state and local laws regulating the discharge of materials into the environment or otherwise relating to the protection of the environment affect our oil and natural gas operations. Numerous governmental departments issue rules and regulations to implement and enforce such laws, which are often difficult and costly to comply with and which carry substantial penalties for failure to comply. Some laws, rules and regulations relating to protection of the environment may, in certain circumstances, impose ''strict liability'' for environmental contamination, rendering a person liable for environmental damages and cleanup costs without regard to negligence or fault on the part of such person. Other laws, rules and regulations may restrict the rate of oil and natural gas production below the rate that would otherwise exist or even prohibit exploration and production activities in sensitive areas. In addition, state laws often require various forms of remedial action to prevent pollution, such as closure of inactive pits and plugging of abandoned wells. The regulatory burden on the oil and natural gas industry increases its cost of doing business and consequently affects its profitability. We believe that we are in substantial compliance with current applicable environmental laws and regulations and that continued compliance with existing requirements will not have a material adverse impact on our operations. However, environmental laws and regulations have been subject to frequent changes over the years, and the imposition of more stringent requirements could require us to make significant capital expenditures, increase our operating costs or otherwise adversely affect our competitive position.

            The Comprehensive Environmental Response, Compensation and Liability Act, also known as ''CERCLA,'' imposes liability, without regard to fault or the legality of the original conduct, on certain classes of persons that are considered to be responsible for the release of a ''hazardous substance'' into the environment. These persons include the current or former owner or operator of the disposal site or sites where the release occurred and companies that disposed or arranged for the disposal of hazardous substances. Under CERCLA, such persons may be subject to joint and several liability for the costs of investigating and cleaning up hazardous substances that have been released into the environment, for damages to natural resources and for the costs of certain health studies. In addition, companies that incur CERCLA liability frequently also confront third party claims because it is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damage allegedly caused by hazardous substances or other pollutants released into the environment from a CERCLA site.

            The Federal Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, also known as "RCRA," regulates the generation, transportation, storage, treatment and disposal of hazardous wastes and can require cleanup of hazardous waste disposal sites. RCRA currently excludes drilling fluids, produced waters and other wastes associated with the exploration, development or production of oil and natural gas from regulation as ''hazardous waste.'' However, other wastes handled at exploration and production sites may not fall within this exclusion. Disposal of non–hazardous oil and natural gas exploration, development and production wastes usually is regulated by state law.

            Stricter standards for waste handling and disposal may be imposed on the oil and natural gas industry in the future. From time to time legislation has been proposed in Congress that would revoke or alter the current exclusion of exploration, development and production wastes from the RCRA definition of ''hazardous wastes,'' thereby potentially subjecting such wastes to more stringent handling, disposal and cleanup requirements. If such legislation were enacted, it could have a significant impact on our operating costs, as well as the oil and natural gas industry in general. Furthermore, although petroleum, including crude oil and natural gas, is exempt from CERCLA, at least two courts have ruled that certain wastes associated with the production of crude oil may be classified as ''hazardous substances'' under CERCLA. The impact of future revisions to environmental laws and regulations cannot be predicted.

            The Oil Pollution Act of 1990, also known as ''OPA 90, provides that persons responsible for facilities and vessels (including the owners and operators of onshore facilities) are subject to strict joint and several liability for cleanup costs and certain other public and private damages arising from a spill of oil into waters of the United States. OPA 90 established a liability limit for onshore facilities of $35 million. However, facilities located in coastal waters may be considered ''offshore'' facilities subject to greater liability limits under OPA 90 (all removal costs plus $75 million). In addition, a party cannot take advantage of this liability limit if the spill was caused by gross negligence or willful misconduct or resulted from a violation of a federal safety, construction or operating regulation. If a party fails to report a spill or cooperate in the cleanup, liability limits likewise do not apply. OPA 90 also imposes other requirements on facility owners and operators, such as the preparation of an oil spill response plan. Failure to comply with ongoing requirements or inadequate cooperation in a spill event may subject the responsible party to civil or criminal enforcement actions.

            OPA 90 also imposes financial responsibility requirements on the person or persons statutorily responsible for certain facilities. Under the related regulations, oil production and storage facilities that are located in wetlands adjacent to coastal waters could be required to demonstrate various levels of financial ability to reimburse governmental entities and private parties for costs that they could incur in responding to an oil spill, if the Minerals Management Services determines that spills from those particular facilities could reach coastal waters.

Operating Risks and Insurance

            The oil and natural gas business involves a variety of operating risks, including the risk of fire, explosions, blow–outs, pipe failure, casing collapse, abnormally pressured formations and hazards such as oil spills, natural gas leaks, ruptures and discharges of toxic gases. The occurrence of any of these operating risks could result in substantial losses to us due to injury or loss of life, severe damage to or destruction of property and equipment, pollution or other environmental damage, including damage to natural resources, clean–up responsibilities, penalties and suspension of operations. Such hazards may hinder or delay drilling, development and on–line operations. In accordance with customary industry practice, we maintain insurance against some, but not all, of the risks described above, including insuring the cost of clean–up operations, public liability and physical damage. There can be no assurance that any insurance we obtain will be adequate to cover any losses or liabilities or that such insurance will continue to be available in the future or that such insurance will be available at premium levels that justify its purchase. The occurrence of a significant event not fully insured or indemnified against could have a material adverse effect on our financial condition and operations.

Employees

            On December 31, 2000, we employed 29 people, including 13 that work in our field offices. None of our employees is covered by a collective bargaining agreement, and we believe that our relationships with our employees are satisfactory. From time to time we utilize the services of independent contractors to perform various field and other services.

Legal Proceedings

            From time to time, we may be a party to various legal proceedings. We currently are a party to a lawsuit arising in the ordinary course of business. Management does not expect this matter to have a material adverse effect on our financial position or results of operations.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

            The following discussion is intended to assist in understanding our financial position and results of operations for each year of the three–year period ended December 31, 2000. Our financial statements and notes thereto contain detailed information that should be referred to in conjunction with the following discussion.

General

            We are an independent oil and gas company engaged in the acquisition, exploitation, exploration, development, and production of natural gas and crude oil. Through our parent company, Forman Petroleum Corporation, we have been active in South Louisiana since 1982. We have established extensive technical and operating experience in this area and plan to expand our scope of operations to include the Gulf coast, mid–continent and permian basins and offshore in the Gulf of Mexico. We recently have entered into the merger agreement with Pontotoc to expand our business to include Oklahoma.

            We were organized on January 9, 2001 principally for the acquisition of Pontotoc. Concurrently with the consummation of the offer, Forman will be restructured as a holding company by contributing all of its assets and liabilities to us, a transaction we refer to as the "Restructuring."

            In August 1999, Forman sought protection from its creditors under Chapter 11 of the United States Bankruptcy Code of 1986. By order dated December 29, 1999, a joint plan of reorganization with respect to Forman was confirmed by the United States Bankruptcy Court for the Eastern District of Louisiana and Forman emerged from protection under Chapter 11 of the Bankruptcy Code. Forman has accounted for the bankruptcy reorganization by using the principles of fresh start accounting required by AICPA Statement of Position 90–7, "Financial Reporting by Entities in Reorganization Under the Bankruptcy Code." For accounting purposes, Forman assumed that the plan of reorganization was consummated on December 31, 1999. Under the principles of fresh start accounting, Forman's total assets were recorded at their assumed reorganization value, with the reorganization value allocated to identifiable tangible assets at their estimated fair value. As a result, Forman's:

• oil and gas full cost pool was reduced by approximately $60 million,

• unevaluated oil and gas properties were increased by approximately $3 million,

• other property and equipment was reduced by approximately $1.6 million, and

• accumulated DD&A of $64.1 million was written off.

In addition, Forman's senior notes payable of $70 million, the interest payable of $11.1 million on the senior notes, its preferred stock of $13.5 million and the related deferred financing costs of $4.4 million were all written off.

            As a result of the implementation of fresh start accounting, the financial statements of Forman after consummation of the bankruptcy plan are not comparable to its financial statements of prior periods. The effect of the plan of reorganization and the implementation of fresh start accounting on Forman's balance sheet as of December 31, 1999 are discussed in detail in the notes to the audited consolidated financial statements of Forman appearing elsewhere in this prospectus. 

Operating Environment

            Our revenues, profitability and future growth and the carrying value of our oil and natural gas properties are substantially dependent on prevailing prices of oil and natural gas. Our ability to increase our borrowing capacity and to obtain additional capital on attractive terms is also influenced by oil and natural gas prices. Prices for oil and natural gas are subject to large fluctuation in response to relatively minor changes in the supply of or demand for oil and natural gas, market uncertainty and a variety of additional factors beyond our control. Any substantial and extended decline in the price of oil or natural gas would have an adverse effect on the carrying value of our proved reserves, borrowing capacity, revenues, profitability and cash flows from operations. Price volatility also makes it difficult to budget for and project the return on either acquisitions or development and exploitation projects.

            We use the full cost method of accounting for our investment in oil and natural gas properties. Under the full cost method of accounting, all costs of acquisition, exploration and development of oil and natural gas reserves are capitalized into a ''full cost pool'' as incurred, and properties in the pool are depleted and charged to operations using the future gross revenue method based on the ratio of current gross revenue to total proved future gross revenues, computed based on current prices. To the extent that such capitalized costs (net of accumulated depreciation, depletion and amortization) less deferred taxes exceed the present value (using a 10% discount rate) of estimated future net cash flow from proved oil and natural gas reserves, and the lower of cost and fair value of unproved properties after income tax effects, excess costs are charged to operations. Once incurred, a write–down of oil and natural gas properties is not reversible at a later date even if oil or natural gas prices increase. We were required to write down our asset base at the end of 1997 due to a downward revision of quantity estimates attributable to a single fault block in the Lake Enfermer Field, combined with significant declines in oil and natural gas prices from the end of 1996. During the second quarter of 1998, we were required to write down our asset base, again due primarily to the continuing decline in oil and natural gas prices. We had an additional full cost ceiling writedown of our asset base at the end of 1998. This writedown was the result of a significant revision to the reserves assigned to a single well in the Lake Enfermer Field, combined with further declines in both oil and natural gas prices during the final quarter of 1998. Lastly, we reduced our full cost pool in 1999 in connection with our predecessor's bankruptcy.

Results of Operations

        Year ended December 31, 2000 versus year ended December 31, 1999

            Revenues. Our oil and gas revenues increased approximately $1.7 million, or 13% during 2000 to $14.7 million compared to $13.0 million in 1999. Production levels for 2000 decreased 33.7% to 569 thousand barrels of oil equivalent ("MBOE") from 859 MBOE for 1999. Gas production volumes decreased 41.9%, while oil production volumes decreased 21.4%. Our average sale prices (including hedging activities) for oil and natural gas for 2000 were $27.49 per Bbl and $4.05 per Mcf versus $17.34 per Bbl and $2.28 per Mcf in 1999. Revenues increased $5.9 million due to higher oil and gas prices during 2000, offset by a $4.2 million decrease in revenues due to the aforementioned production decreases.

            Lease Operating Expenses. On a BOE basis, lease operating expenses increased 60.7%, to $5.89 per BOE for 2000 from $3.66 per BOE in 1999. For 2000, actual lease operating expenses were up 6.6%, from $3.1 million in 1999 to $3.4 million in 2000. This increase was due primarily to an increase in workover activity in 2000.

            Severance Taxes. Our effective severance tax rate as a percentage of oil and gas revenues decreased to 4.4% for 2000 from 5.6% for 1999. This relatively low effective rate is attributable to the increased production from wells that have a state severance tax exemption under Louisiana's severance tax abatement program. The decreases in the effective tax rates between 1999 and 2000 are partially offset by the increase in the gas severance tax rate in 2000.

            Depreciation, Depletion and Amortization Expense. For 2000, depreciation, depletion and amortization ("DD&A") expense decreased 19.9% from 1999. The decrease for the year is attributable to our decreased production and related future capital costs in 2000 and the upward revision of reserves. On a BOE basis, which reflects the decreases in production, the DD&A rate for 2000 was $7.87 per BOE compared to $6.52 per BOE for 1999, an increase of 21%. The increase in DD&A per BOE was due primarily to an increase in the full, cost pool and variations in pricing during the year. Reserve additions as of December 31, 2000, affected only the fourth quarter DD&A calculation.

            General and Administrative Expense. For 2000, on a BOE basis, general and administrative ("G&A") expenses increased 32.9%, from $3.51 per BOE in 1999 to $4.67 in 2000. The increase in G&A per BOE in 2000 was due to the decrease in production during 2000 as compared to 1999. Actual G&A expenses decreased 11.8%, from $3.0 million in 1999 to $2.7 million in 2000. The decrease in actual G&A expenses for 2000 was primarily the result of the capitalization of G&A expenses, in the amount of $842,391, into the full cost pool in 2000. No G&A was capitalized into the full cost pool for 1999 due to the bankruptcy and lack of funds to conduct acquisition and exploration activities. Without this capitalization of G&A in 2000, G&A on a BOE basis increased 75%, to $6.14 in 2000. Actual G&A in 2000, without the capitalization in 2000, increased $485,000 primarily due to income and franchise taxes, the addition of directors' fees and increases in contract services related to the appointment of our new president in June 2000. The recapitalization costs incurred in conjunction with the reorganization of Forman of $899,000 were not included in recurring G&A for comparison purposes.

            Proved Reserves. The discounted present value of our reserves increased 500%, from $36.4 million at the end of 1999 to $182 million at the end of 2000, primarily as a result of the significant increases in both oil and gas prices between December 1999 and December 2000, combined with the new reserves attributable to workovers and recompletions of wells in our Boutte and Lake Enfermer Fields. Our realized oil prices increased 58.6% between December 31, 1999 and December 31, 2000, from an average price per barrel of $17.34 for 1999 to an average price of $27.49 for 2000. Our realized gas prices in 2000 increased 77.8% over the realized 1999 price, from an average price per Mcf of $2.28 for 1999 to an average price per Mcf of $4.05 for 2000.

            Interest Expense. Interest expense for 2000 decreased from $6.2 million in 1999 to $0 for 2000. Actual interest expense of $274,000 was incurred in 2000 but was capitalized into the unevaluated property within the full cost pool for reporting purposes. This decrease of $5.9 million in interest expense is due to the cessation of interest payable on our predecessor's senior notes, which were canceled as a result of the reorganization effective January 14, 2000.

            Net Income (Loss) From Operations. Due to the factors described above, our net income from operations before extraordinary items for 2000 was $1.7 million, an increase of $2.1 million from the net loss of $349,405 for 1999.

            Income tax expense. We were required to establish a net deferred tax liability calculated at the applicable Federal and state tax rates resulting primarily from financial reporting and income tax reporting basis differences in oil and gas properties. Accordingly, as a result of fresh start accounting a net deferred tax liability of $9.9 million was recorded at December 31, 1999.

        Year ended December 31, 1999 versus year ended December 31, 1998

            Revenues. Our oil and gas revenues decreased approximately $2.9 million, or 18% during 1999 to $13.0 million compared to $16.0 million in 1998. Production levels for 1999 decreased 29% to 859 MBOE from 1,217 MBOE for 1998. Gas production volumes decreased 37.5%, while oil volumes decreased 12.7%. Our average sale prices (including hedging activities) for oil and natural gas for 1999 were $17.34 per Bbl and $2.28 per Mcf versus $12.09 per Bbl and $2.27 per Mcf in 1998. Revenues decreased $5.2 million due to the aforementioned production decreases, offset by a $2.3 million increase in revenues due to higher oil and gas prices during 1999.

            Lease Operating Expenses. On a BOE basis, lease operating expenses increased 32%, to $3.66 per BOE for 1999 from $2.76 per BOE in 1998. For 1999, actual lease operating expenses were down 8.8%, from $3.4 million in 1998 to $3.1 million in 1999. This decrease was due to a decrease in 1999 in the volumes of oil and gas produced.

            Depreciation, Depletion and Amortization Expense. For 1999, DD&A expense decreased 47% from 1998. The decrease for the year is attributable to our decreased production and related future capital costs in 1999 and the upward revision of reserves. On a BOE basis, which reflects the decreases in production, the DD&A rate for 1999 was $6.52 per BOE compared to $8.58 per BOE for 1998, a decrease of 24%.

            General and Administrative Expense. For 1999, on a BOE basis, G&A expenses increased 53%, from $2.28 per BOE in 1998 to $3.51 in 1999. Actual G&A expenses increased 8.6%, from $2.8 million in 1998 to $3.0 million in 1999. This increase was due primarily to the administrative costs of the reorganization activity during 1999. The recapitalization costs incurred in conjunction with the reorganization of Forman of $899,000 were not included in recurring G&A for comparison purposes.

            Proved Reserves. The discounted present value of our reserves increased 90%, from $19.2 million at the end of 1998 to $36.4 million at the end of 1999, primarily as a result of the new reserves attributable specifically to the Simoneaux 26 well in our Boutte Field, combined with the significant increases in both oil and gas prices between December 1998 and December 1999. Our realized oil prices increased 43% between December 31, 1998 and December 31, 1999, from an average price per barrel of $12.09 on December 31, 1998 to an average price of $17.34 on December 31, 1999. Our realized gas prices on December 31, 1999 increased 0.4% over the December 31, 1998 price, from an average price per Mcf of $2.27 in 1998 to an average price per Mcf of $2.28 in 1999. Our predecessor experienced a $19.6 million writedown of its full cost pool during 1998 due to ceiling test limitations and did not experience any such ceiling test writedown of its full cost pool in 1999.

            Interest Expense. Interest expense for 1999 decreased from $10.1 million in 1998 to $6.2 million for 1999. This decrease of $3.9 million in interest expense is due to the cessation of interest payable on our predecessor's senior notes from August 6, 1999, the date our predecessor filed for protection under the United States Bankruptcy Code.

            Net Income (Loss) From Operations. Due to the factors described above, the net loss from operations before reorganization costs and extraordinary items decreased from $30.5 million for 1998 to a loss of $0.3 million for 1999.

Liquidity and Capital Resources

        Working Capital and Cash Flow

            Following the acquisition of Pontotoc, we plan to use cash flows from operations and our new credit facility to fund our future acquisition, exploration and development activities. Our future cash flow from operations will depend on our ability to maintain and increase production through our exploration, development and exploitation activities, as well as the prices of oil and natural gas.

            At December 31, 2000, we had $4.7 million of working capital compared to $1.7 million at December 31, 1999. During 2000, we completed five recompletion/workover projects on our existing Louisiana properties, of which all five were successful. We did not drill any wells in 2000.

            Provided that the Pontotoc Acquisition is completed, our 2001 capital expenditure budget will focus on developing and expanding shallow natural gas reserves in and around Pontotoc's existing Oklahoma properties and exploitation activities on our existing Louisiana properties. We plan to commence a drilling and recompletion program on the existing Oklahoma properties. In addition, we plan to add to the gathering system currently leased under a long term contract by Pontotoc by purchasing and/or leasing additional segments. With respect to our Louisiana properties, we plan to continue recompletion and workover activities during 2001. We plan to retain controlling interests in our operated properties to retain the ability to control the timing of our capital commitments and the ability to adjust our spending as oil and gas prices fluctuate. Our capital expenditure plans for development and exploitation activities for 2001 are currently estimated to be approximately $2.7 million. Actual levels of capital expenditures may vary significantly due to many factors, including drilling results, oil and natural gas prices, industry conditions, participation by other working interest owners and the prices of drilling rigs and other oilfield goods and services. We believe that our working capital, cash flows from operations and borrowings under our new bank facility will be sufficient to meet our capital expenditure plans for development and exploitation activities through the end of 2001 and our obligations for 2001 under the long term notes issued pursuant to the bankruptcy plan.

            In addition, we will continue to pursue farm–in or joint venture partners for drilling prospects on our existing Louisiana properties. The amount of capital expenditures for these drilling prospects will depend on the participation by other working interest owners, the availability of capital and other industry conditions.

            Part of Ascent Energy's strategy involves the acquisition of additional properties. We plan to explore outside funding opportunities including equity or additional debt financings for use in consummating additional acquisitions. We do not know whether any financing can be accomplished on terms that are acceptable to us.

        Bank Credit Facility

            We have received a commitment letter from Fortis Capital Corp. to enter into a senior secured revolving credit facility with a $40 million aggregate borrowing capacity. The initial borrowing base under the new credit facility is $30 million and is subject to semi–annual redeterminations based upon a review of our reserves. Fortis Capital Corp., will act as the administrative agent and lead arranger. This new credit facility will be used:

∙ to finance a portion of the cash consideration to be paid in the Pontotoc acquisition,

∙ to repay the amount of indebtedness under Pontotoc's existing credit facility;

∙ to finance the future acquisition and development of oil and gas properties; and

∙ for other general corporate purposes.

            The facility will mature on the third anniversary of the closing of the Pontotoc acquisition. Amounts borrowed under this new credit facility will bear interest at a variable rate equal to LIBOR plus a margin ranging from 1.75% to 2.50%. We will pay commitment fees ranging from 0.375% to 0.5% per year on the undrawn portion of the facility. Prior to maturity, no payments of principal will be required so long as the borrowing base exceeds the credit facility balance. Interest will be payable quarterly. The credit facility will restrict us from declaring or paying dividends on our common stock without our lender's consent.

            Substantially all of our producing properties will be mortgaged to secure our new credit facility. The new credit facility will provide for certain covenants, including restrictions or requirements with respect to working capital, net worth, disposition of properties, incurrence of additional debt, change of ownership and reporting responsibilities.

Hedging Activities

            With the objective of achieving more predictable revenues and cash flows and reducing our exposure to fluctuations in oil and natural gas prices, we have entered into hedging transactions of various kinds with respect to both oil and natural gas. While the use of these hedging arrangements limits the downside risk of reverse price movements, it may also limit future revenues from favorable price movements.

            Our new credit facility will require us to secure hedging arrangements with respect to approximately 50% of our future production through December 2002. In addition, we may enter into hedging arrangements beyond that required under our new credit facility. We plan to continuously reevaluate our hedging program in light of market conditions, commodity price forecasts, capital spending and debt service requirements.

New Accounting Standards

            The Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities" in June 1997. This statement establishes accounting and reporting standards for derivative instruments and hedging activities. According to Statement No. 133, we must recognize the fair value of all derivative instruments as either assets or liabilities in our consolidated balance sheet. A derivative instrument meeting certain conditions may be designated as a hedge of a specific exposure. Accounting for changes in a derivative's fair value will depend on the intended use of the derivative and the resulting designation. Any transition adjustments resulting from adopting this statement will be reported in net income or other comprehensive income, as appropriate, as the cumulative effect of a change in accounting principle. As described under the heading "Quantitative and Qualitative Disclosures About Market Risk" below, we will make use of derivative instruments to hedge specific market risks. We are currently evaluating the impact of this statement in light of the hedging requirements under our new credit facility.

Quantitative and Qualitative Disclosures About Market Risk

        Hedging Activity

            Our revenues are derived from the sale of oil and natural gas production. From time to time, we enter into hedging transactions that fix, for specific periods and specific volumes of production, the prices we will receive for our production. These agreements reduce our exposure to decreases in the commodity prices on the hedged volumes, while also limiting the benefit we might otherwise have received from increases in commodity prices of the hedged production. Our new credit facility will require us to secure hedging arrangements with respect to approximately 50% of our future production through December 2002. In addition, we may enter into hedging arrangements beyond that required under our new credit facility. The impact of hedges is recognized in oil and gas sales in the period the related production revenues are accrued.

            Despite the measures we may take to attempt to control price risk, we will remain subject to price fluctuations for oil and natural gas sold in the spot market. Prices received for natural gas sold in the spot market are volatile due primarily to seasonality of demand and other factors beyond our control. Oil and natural gas prices can change dramatically primarily as a result of the balance between supply and demand. The trend since 1998 has been upward, with our average natural gas price received for 2000 of $4.05 per Mcf, up from $2.28 per Mcf in 1999 and $2.27 per Mcf in 1998. Our average oil price received for 2000 was $27.49 per Bbl, up from our average price received of $17.34 in 1999 and $12.09 in 1998. There can be no assurance that prices will not decline from current levels. Declines in domestic oil and natural gas prices could have a material adverse effect on our financial position, results of operations and quantities of reserves recoverable on an economic basis.

            Based on projected annual production volumes for 2001, a 10% decline in the prices we receive for our oil and natural gas production would have an approximate $21.6 million negative impact on our discounted future net revenues.

ASCENT ENERGY'S MANAGEMENT

Directors and Executive Officers

            The following table sets forth, as of the date of this prospectus, certain information with respect to the persons who will serve as our directors and executive officers following the merger.

Name	Age	Positions with Ascent Energy
Nicholas Tell, Jr.	39	Chairman of the Board
Jeffrey Clarke	55	President and Director
Daniel O. Conwill, IV	40	Director
James "Robby" Robson, Jr.	42	Director
Jerry W. Box	62	Director

            Nicholas Tell, Jr. has been Chairman of the Board since our inception. Mr. Tell has served as the Chairman of the Board of Forman since January 2000. Mr. Tell is the Managing Director, Capital Markets and Special Situations, of Trust Company of the West. Mr. Tell joined TCW when TCW acquired Crescent in 1995. Previously, Mr. Tell was Vice President and Counsel of Crescent where he structured and negotiated many of the firm's private investments. Prior to joining Crescent, Mr. Tell was a Senior Associate at Latham & Watkins. From 1987 through 1992, Mr. Tell was involved in a wide variety of corporate transactions, including mergers and acquisitions and corporate financings for below–investment–grade companies. Mr. Tell received his Juris Doctor from the University of Chicago and his B.A. from Carleton College.

            Jeffrey Clarke has been our President and a Director since our inception. Mr. Clarke has served as a Director of Forman since January 2000, and has served as its President from June 2000 to present. From September 1993 to March 2000, Mr. Clark served as Chairman and Chief Executive Officer of Coho Energy, Inc., an independent energy company engaged, through its wholly owned subsidiaries, in the development and production of, and exploration for, crude oil and natural gas principally in Mississippi and Oklahoma. From August 1990 to September 1993, Mr. Clarke served as President and Chief Operating Officer of Coho Energy, Inc. Prior to that time, Mr. Clarke served in various capacities with Coho Resources, Ltd. and Coho Resources, Inc., affiliates of Coho Energy, Inc. Coho Energy, Inc. and certain of its affiliates filed for protection under Chapter 11 of the United States Bankruptcy Code on August 23, 1999. Coho's bankruptcy reorganization plan was approved in March 2000. Mr. Clarke holds a BS in Physics from University of Wales, 1967, and conducted postgraduate work in Physics at the University of East Anglia, 1967–1968.

            Daniel O. Conwill, IV has been a Director since our inception. Mr. Conwill is currently an Executive Vice President and Director of Corporate Finance of Jefferies & Company, Inc. and is a member of the Board of Directors of Jefferies & Co., Inc. Prior to joining Jefferies, Mr. Conwill was a Managing Director in the Corporate Finance Department of Howard, Weil, Labouisse, Friedrichs Incorporated where he had primary responsibility for exploration and production companies. Prior to joining Howard Weil, Mr. Conwill was a Certified Public Accountant with the Tax Department of Arthur Andersen & Co. Mr. Conwill received his Bachelors and Masters Degrees in Accounting from the University of Mississippi and has a law degree from the University of Mississippi School of Law.

            James "Robby" Robson, Jr. is to become a Director and our employee following the merger. Mr. Robson has served as President, Chief Executive Officer and Director of Pontotoc Production, Inc. from December 1997 to present. Mr. Robson also held these same positions with Pontotoc Production Company, Inc., Pontotoc Production, Inc.'s wholly–owned subsidiary, from January 1987 to present. From January 1985 through January 1987, he worked as a consultant for Pontotoc Production Company, Inc. From April 1982 until January 1985, he served as the President of Robco Oil Co. From August 1981 until March 1982 he served as Vice President of Marketing for Daner Oil Co., Inc. From March 1981 until August 1981, he was a free agent running back with the Pittsburgh Steelers. Mr. Robson attended Youngstown State University from 1977 until 1981.

            Jerry W. Box is to become a Director following the merger. Mr. Box has been a Director of Forman since January 2000. He has served as President and Chief Operating Officer of Oryx Energy Company from 1998 until shortly after the merger of Oryx Energy Company with Kerr–McGee Corporation in early 1999. From 1988 through 1998, Mr. Box served in various other capacities with Oryx Energy Company. Mr. Box holds a BS and an MS in Geology from Louisiana Tech University. He is also a graduate of the Program for Management Development at Harvard Business School.

            Our bylaws provide that we have a classified board of directors comprised of three classes, each of which serves for three years, with one class being elected each year. The terms of Messrs. Clarke and Robson will expire in 2002, the terms of Messrs. Conwill and Box in 2003 and the term of Mr. Tell in 2004.

Board Committees

            We do not have any committees of our board of directors.

Director Compensation

            Each director who is not also our employee is paid an annual director's fee of $20,000 and fees of $1,500 for each meeting attended. All directors are reimbursed for reasonable out–of–pocket expenses incurred by them in attending board meetings.

Executive Compensation

            The following table sets forth the compensation paid to our President for services rendered by him as President of Forman from June 2000 to December 31, 2000. No other of our executive officers earned more than $100,000 in fiscal year 2000 or before.

Summary Compensation Table

		Annual Compensation
Name and Principal Position	Year	Salary	Bonus
Jeffrey Clarke, President	2000	$120,000	$      –––

Executive Employment Agreements

            We have not entered any employment agreements with our executive officers.

Stock Incentive Plan

            We have not adopted and our stockholders have not approved a stock incentive plan.

Compensation Committee Interlocks and Insider Participation

            We do not have a compensation committee of our board of directors.

Limitation of Directors' Liability and Indemnification

            Our certificate of incorporation contains provisions eliminating the personal liability of our directors to us and our stockholders for monetary damages for breaches of their fiduciary duties as directors to the fullest extent permitted by the Delaware General Corporation Law. By virtue of these provisions, under current Delaware corporate law a director will not be personally liable for monetary damages for a breach of his or her fiduciary duty except for liability for:

• a breach of his or her duty of loyalty to us or to our stockholders

• acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law,

• dividends or stock repurchases or redemptions that are unlawful under Delaware law, and

• any transaction from which he or she receives an improper personal benefit.

These provisions pertain only to breaches of duty by directors as directors and not in any other corporate capacity, such as officers, and limit liability only for breaches of fiduciary duties under Delaware corporate law and not for violations of other laws such as the federal securities laws.

            As a result of the inclusion of such provisions, stockholders may be unable to recover monetary damages against directors for actions taken by them that constitute negligence or gross negligence or that are in violation of their fiduciary duties, although it may be possible to obtain injunctive or other equitable relief with respect to such actions. If equitable remedies are found not to be available to stockholders in any particular case, stockholders may not have any effective remedy against the challenged conduct. These provisions may have the effect of reducing the likelihood of derivative litigation against directors that might have benefited us.

            We believe that such provisions are necessary to attract and retain qualified individuals to serve as directors. In addition, such provisions will allow directors to perform their duties in good faith without undue concern about personal liability if a court finds their conduct to have been negligent or grossly negligent. On the other hand, the potential remedies available to our stockholders will be limited, and it is possible, although unlikely, that directors protected by these provisions may not demonstrate the same level of diligence or care that they would otherwise demonstrate.

            Our bylaws require us to indemnify our directors and officers against certain expenses and costs, judgments, settlements and fines incurred in the defense of any claim, including any claim brought by us or in our right, to which they were made parties by reason of being or having been directors and officers, subject to certain conditions and limitations.

            In addition, each of our directors has entered into an indemnity agreement with us, pursuant to which we have agreed under certain circumstances to purchase and maintain directors' and officers' liability insurance. The agreements also provide that we will indemnify the directors against any costs and expenses, judgments, settlements and fines incurred in connection with any claim involving a director by reason of his position as a director that are in excess of the coverage provided by such insurance; provided that the director or executive officer meets certain standards of conduct. A form of indemnity agreement containing such standards of conduct is included as an exhibit to the registration statement of which this prospectus forms a part. Under the indemnity agreements, we are required to purchase and maintain directors' and officers' liability insurance unless our board of directors determines in good faith that the premium costs of such insurance are disproportionate to the amount of coverage or the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit.

BENEFICIAL OWNERSHIP OF COMMON STOCK

            The following table sets forth information regarding the beneficial ownership of our common stock by each stockholder known by us to be the beneficial owner of more than 5% of our outstanding common stock, each director and executive officer of the company and all of our directors and executive officers as a group:

• as of March 15, 2001; and

• on a pro forma as adjusted basis to give effect to the offer and sale of the Series A preferred stock and the warrants and the consummation of the offer and the merger.

            Unless otherwise indicated, we believe that the stockholders listed below have sole investment and voting power with respect to their shares based on information furnished to us by such owners.

	Beneficial Ownership
	As of March 15, 2001			Pro Forma As Adjusted
Name of Beneficial Owners	Number of Shares	Percent of Class	Number of Shares(1)		Percent of Class
Forman Petroleum Corporation.   650 Poydras Street, Suite 2200   New Orleans, Louisiana 70130	1,000	100%	4,634,483		46.3%
The TCW Funds   11100 Santa Monica Boulevard   Suite 2000   Los Angeles, California 90025	–––	–––	1,943,528		19.4%
Jefferies & Company, Inc.   11100 Santa Monica Boulevard   12th Floor   Los Angeles, California 90025	–––	–––	1,447,387		14.5%
Nicholas W. Tell, Jr.	–––	–––	–––		–––
Danny O. Conwill, IV	–––	–––	–––		–––
Jeffrey Clarke	–––	–––	–––		–––
Jerry Box	–––	–––	–––		–––
James "Robby" Robson(2)	–––	–––	106,974		1%
Executive Officers and Directors as   group (5 persons)	–––	–––	106,974		1%

______________

(1)            Because the total number of shares issuable upon exercise of the warrants is subject to final
                determination by our board of directors, these numbers may be subject to change.

(2)            Includes 106,974 shares issuable upon conversion of Series B preferred stock within 60 days of
                _______, 2001.

DESCRIPTION OF ASCENT ENERGY CAPITAL STOCK

General

            The description below summarizes material provisions of our capital stock and is qualified in its entirety by reference to our certificate of incorporation, certificates of designations and bylaws, copies of which are included as exhibits to the registration statement of which this prospectus is a part. 

Authorized and Outstanding Capital Stock

            Our authorized capital stock consists of:

• 20,000,000 shares of common stock, $0.001 par value per share

• 10,000,000 shares of preferred stock, $0.001 par value per share

            As of March 15, 2001, 1,000 shares of our common stock were outstanding and there were no shares of our preferred stock outstanding. See "Beneficial Ownership of Common Stock of Ascent Energy."

Preferred Stock

            Under the terms of our certificate of incorporation, our board of directors is authorized, subject to any limitations prescribed by law, without stockholder approval, to issue up to 10,000,000 shares of preferred stock in one or more series with such rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, as the board of directors determines. The rights of the holders of our common stock will be subject to, and may be adversely affected by, the rights of the holders of our preferred stock. The issuance of a new series of our preferred stock could have the effect of delaying, deferring or preventing a change of control of Ascent Energy.

        8% Series A Redeemable Preferred Stock

            General. We have designated 21,100 shares of a new series of 8% redeemable preferred stock, par value $0.001 per share. The Series A preferred stock has a par value of $0.001 per share, with a liquidation preference of $1,000 per share. It is mandatorily redeemable on the fifth anniversary of the date of issuance at a cash price per share equal to the liquidation preference plus accrued and unpaid dividends up to and including the redemption date. The Series A preferred stock ranks on a parity with our Series B preferred stock, senior to or on a parity with all other classes and series of our preferred stock, and senior to our common stock as to the payment of dividends and the distribution of the assets upon our liquidation, dissolution or winding up. There are no shares of Series A preferred stock outstanding as of the date hereof.

            Dividend Rights. Holders of shares of the Series A preferred stock are entitled to receive, when, as and if declared by our board of directors out of funds legally available therefor, cash dividends at the annual rate of 8% or $80 per share. Dividends are payable quarterly and promptly after the tenth business day of each January, April, July and October of each year, commencing on July 10, 2001. Dividends will be payable to holders of record as they appear on our stock transfer books on those record dates as are fixed by our board of directors.

            Dividends will begin to accrue on outstanding shares of Series A preferred stock and to accumulate from the initial date of issuance, whether or not earned or declared. Dividends for any period less than a full quarterly period will be computed on the basis of a 365–day year for the actual number of days elapsed. Dividends will accrue whether or not there will be, at the time any such dividend becomes payable or at any other time, profits, surplus or other funds of legally available for the payment of dividends. Dividends will cease to accrue on the shares of Series A preferred stock on the date of their redemption. Accumulations of dividends on shares of Series A preferred stock will not bear interest.

            No dividend will be declared on any other series or class or classes of stock to which the Series A preferred stock ranks prior or on a parity with as to dividends or liquidation, in respect of any quarterly period, nor will any shares of any such series or class be redeemed, purchased or otherwise acquired for any consideration, or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares, unless there will have been or contemporaneously are declared and paid on all shares of the Series A preferred stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. Dividends will also be payable upon any date of redemption and upon the final distribution date relating to our dissolution, liquidation or winding up.

            Conversion Rights. The Series A preferred stock is not convertible into or exchangeable for any of our other property or securities.

            Liquidation Rights. Upon our voluntary or involuntary liquidation, winding up or dissolution (in connection with our bankruptcy or insolvency or otherwise), the holders of Series A preferred stock will be entitled to receive, out of the assets available for distribution to our stockholders, in preference to any payment or distribution to the holders of our common stock or any other stock ranking junior to the Series A preferred stock, as to dividends, liquidation, dissolution or winding up, $1,000 per share (the "Liquidation Preference") plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid on each share up to and including the date of final distribution to the holders. After the Liquidation Preference and all accrued and unpaid dividends have been paid on the Series A preferred stock, the remaining assets will be paid to the holders of common stock and other junior classes of stock in accordance with their respective priority, if any. In the event our net assets are insufficient to pay the holders of the Series A preferred stock the full amount of their preference set forth above and the holders of any other series of our capital stock ranking on a parity with the Series A preferred stock the liquidating payments to which they are entitled, then our remaining net assets will be divided among and paid to the holders of the shares of Series A preferred stock and any other shares of our capital stock ranking on a parity with the Series A preferred stock ratably per share in proportion to the full per share amounts to which they would be entitled if all amounts payable thereon were paid in full, and the holders of our common stock and other junior classes of stock will receive nothing. Neither a merger or consolidation of Ascent Energy with or into any other corporation or entity nor the sale of all or substantially all of our assets will be deemed to be a liquidation, dissolution or winding up for purposes of determining whether the holders of the Series A preferred stock are entitled to receive the Liquidation Preference as described above.

            Redemption. The Series A preferred stock is redeemable, at our sole option and election, in whole or in part, at any time and from time to time, for cash. In addition, the Series A preferred stock is mandatorily redeemable for cash, from any source of funds legally available therefore, on the fifth anniversary of the date of issuance. The cash redemption price per share will be equal to 100% of the liquidation preference, $1,000 per share, plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid on each share up to and including the date fixed for redemption, in immediately available funds.

            At least 20 but not more than 60 days before the redemption date, notice of redemption will be mailed to each holder of record of the Series A preferred stock to be redeemed, at the address shown on our stock transfer books. If fewer than all the outstanding shares of Series A preferred stock are to be redeemed, we will select those shares to be redeemed pro rata. After the redemption date, dividends will cease to accrue on the shares of Series A preferred stock called for redemption. In addition, all rights of the holders of these shares will terminate except the right to receive the redemption price therefor. There is no mandatory sinking or retirement fund obligation with respect to the Series A preferred stock.

            Change of Control Redemption. Upon the occurrence of a "change of control" of Ascent Energy (as discussed below), each holder of Series A preferred stock will have the right to require us to redeem the Series A preferred stock, in cash at a price per share equal to 101% of the liquidation preference, or $1,010 per share, plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid on each share up to and including the date fixed for redemption. For purposes of the change of control redemption, a "change of control" means the occurrence of any of the following:

• any person or group acquires more than a majority of the voting power of all classes of our voting stock; or

• the direct or indirect sale, lease, exchange or other transfer of all or substantially all of our assets to any person or group, other than our subsidiary or other affiliate; or

• the consummation of any consolidation or merger of Ascent Energy with or into another entity with the effect that our stockholders hold less than 51% of the combined voting power of the outstanding securities of the surviving entity; or

• during any consecutive two–year period, individuals who at the beginning of such period constituted our board of directors (together with any new directors whose election to the board of directors or whose nomination for election by the stockholders of Ascent Energy, was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of our board of directors then in office; or

• we are liquidated or dissolved or adopt a plan of liquidation or dissolution.

            We will give written notice of the occurrence of a change of control of Ascent Energy (addressed to each holder of our Series A preferred stock at its address as it appears on our stock transfer books) not earlier than 60 nor less than 20 days before the date of such occurrence. The notice will specify the date for redemption payments to be made, which will be a date not later than the date of the occurrence of the change of control.

            Voting Rights. Holders of the Series A preferred stock will have no voting rights except as described below or as required by law. In exercising any such vote, each outstanding share of Series A preferred stock will be entitled to one vote. We will not, without the affirmative vote of holders of at least a majority of the outstanding shares of Series A preferred stock, voting together as a single class, amend or waive any of the provisions of our certificate of incorporation or the related certificate of designations, so as to materially and adversely affect any right, preference or privilege of the Series A preferred stock or the holders thereof. Any increase in the amount of authorized preferred stock or the creation or issuance of other series of preferred stock, in each case ranking on a parity with or junior to the Series A preferred stock, will not be deemed to materially and adversely affect such rights, preferences or privileges. However, the authorization or issuance of additional shares of Series A preferred stock or the creation or issuance of other series or classes of preferred stock ranking prior to the Series A preferred stock will be deemed to materially and adversely affect such rights, preferences and privileges.

            Other Provisions. The shares of Series A preferred stock, when issued, will be duly and validly issued, fully paid and nonassessable. The holders of Series A preferred stock have no preemptive rights with respect to any of our securities. The Series A preferred stock has not been approved for listing on any stock exchange.

        8% Series B Convertible Preferred Stock

            General. We have designated 5,500,000 shares of a new series of 8% convertible preferred stock, par value $0.001 per share. We have attached the certificate of designations of our 8% Series B Convertible Preferred Stock as Annex E to this prospectus.

            The Series B preferred stock has a par value of $0.001 per share, with a liquidation preference of $2.50 per share. It is convertible at the option of the holder at any time, unless earlier redeemed, into shares of our common stock at an initial conversion rate of 0.1878395 shares of common stock per share of Series B preferred stock. The Series B preferred stock will automatically convert into common stock at an initial conversion rate of 0.1878395 shares of common stock for each share of Series B preferred stock on the second anniversary date of the initial date of issuance (the "Mandatory Conversion Date").

            The Series B preferred stock ranks on a parity with our Series A preferred stock, senior to or on a parity with all other classes and series of our preferred stock, and senior to our common stock as to the payment of dividends and the distribution of the assets upon our liquidation, dissolution or winding up. There are no shares of Series B preferred stock outstanding as of the date hereof.

            Dividend Rights. Holders of shares of the Series B preferred stock are entitled to receive, when, as and if declared by our board of directors out of funds legally available therefor, cash dividends at the annual rate of 8% or $0.20 per share. Dividends are payable quarterly and promptly after the tenth business day of each January, April, July and October of each year, commencing on July 10, 2001. Dividends will be payable to holders of record as they appear on our stock transfer books on those record dates as are fixed by our board of directors.

            Dividends will begin to accrue on outstanding shares of Series B preferred stock and to accumulate from the initial date of issuance, whether or not earned or declared. Dividends for any period less than a full quarterly period will be computed on the basis of a 365–day year for the actual number of days elapsed. Dividends will accrue whether or not there will be, at the time any such dividend becomes payable or at any other time, profits, surplus or other funds of legally available for the payment of dividends. Dividends will cease to accrue on the shares of Series B preferred stock on the date of their earlier conversion or redemption. Accumulations of dividends on shares of Series B preferred stock will not bear interest.

            No dividend will be declared on any other series or class or classes of stock to which the Series B preferred stock ranks prior or on a parity with as to dividends or liquidation, in respect of any quarterly period, nor will any shares of any such series or class be redeemed, purchased or otherwise acquired for any consideration, or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares, unless there will have been or contemporaneously are declared and paid on all shares of the Series B preferred stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. Dividends will also be payable upon any date of redemption and upon the final distribution date relating to our dissolution, liquidation or winding up.

            Optional Conversion Rights. The Series B preferred stock is convertible at the option of the holder at any time prior to the Mandatory Conversion Date, unless earlier redeemed, into shares of our common stock at an initial conversion rate of 0.1878395 shares of common stock per share of Series B preferred stock. The conversion rate is subject to adjustment upon certain events, including a subdivision, combination, consolidation, reorganization, reclassification, exchange or substitution of our common stock. If shares of Series B preferred stock are earlier called for redemption, the conversion right with respect thereto will terminate at the close of business on the date fixed for redemption. Fractional shares of common stock will not be issued upon conversion of the Series B preferred stock, but the number of shares of common stock to be issued will be rounded up to the nearest whole share.

            Holders of Series B preferred stock at the close of business on a record date for any payment of declared dividends will be entitled to receive the dividends so declared on the corresponding dividend payment date notwithstanding the optional conversion of such shares following such record date and prior to such dividend payment date. Except as provided above, upon any optional conversion of shares of Series B preferred stock, we will make no payment of or allowance for unpaid dividends, whether or not in arrears, on such shares of Series B preferred stock as to which optional conversion has been effected, or previously declared dividends or distributions on the shares of common stock issued upon such optional conversion. As promptly as practicable after the surrender of the Series B preferred stock, we will issue and deliver to such holder certificates for the number of shares of common stock issuable upon the conversion of the Series B preferred stock.

            Fundamental Change Transaction. In case of any transaction (including a merger, consolidation, statutory share exchange, sale of all or substantially all of our assets or the recapitalization of our common stock), in each case as a result of which shares of our common stock (or any other of our securities then issuable upon conversion of the Series B preferred stock) will be converted into the right to receive stock, securities or other property (including cash or any combination thereof) (each of the foregoing transactions being referred to as a "Fundamental Change Transaction"), then, lawful and fair provision will be made whereby the shares of Series B preferred stock will, immediately prior to the consummation of the Fundamental Change Transaction, convert and the holders of Series B preferred stock will have the right to receive, upon the basis and upon the terms and conditions specified in connection with such Fundamental Change Transaction and in lieu of the shares of our common stock receivable upon the conversion of such shares, such shares of stock, securities or other property (including cash or any combination thereof) as may be issued or payable with respect to or in exchange for the number of outstanding shares of such common stock equal to the number of shares of such stock immediately theretofore receivable upon the conversion of shares of Series B preferred stock, had such Fundamental Change Transaction not taken place, plus an amount in cash equal to all accrued and unpaid dividends (whether or not earned or declared) on such shares of Series B preferred stock (other than previously declared dividends payable to a holder of record as of a prior date) to and including the effective date of the Fundamental Change Transaction, whether or not declared, out of funds legally available for the payment of dividends. We will not effect any Fundamental Change Transaction unless prior to the consummation thereof the successor corporation (if other than us) resulting from such consolidation or merger, or the corporation purchasing such assets, will assume by written instrument the obligation to deliver to the holders of Series B preferred stock such shares of stock, securities, or assets as such holder would be entitled to acquire in accordance with the foregoing provisions. If the Series B preferred stock becomes subject to conversion into any securities other than shares of our common stock, thereafter the number of such other securities so issuable upon conversion of the shares of Series B preferred stock will be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the shares of Series B preferred stock described above.

            Notices. At least 20 days prior to:

• declaring or paying any dividend to holders of our common stock;

• effecting any capital reorganization, or reclassification of our common stock, or consolidation or merger with, or sale of all or substantially all of our assets to, another corporation or other entity;

• any voluntarily or involuntarily dissolution, liquidation or winding–up of Ascent Energy;

• any other Fundamental Change Transaction; or

• any other event that would cause an adjustment to the conversion rate of the Series B preferred stock;

we will give written notice to each holder of Series B preferred stock of the date on which our books will close or records will be taken for such dividend or distribution or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction. This notice will also specify, in the case of any such dividend or distribution, the date on which the holders of common stock will be entitled thereto.

            In addition, at least 30 days prior to any reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction known to the Company, we will give written notice of the date (or if not then known, a reasonable approximation thereof) when the same will take place. This notice will also specify the date on which the holders of common stock will be entitled to receive their shares of stock, securities or other property deliverable upon the reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction.

            Mandatory Conversion. Unless previously converted at the option of the holder, the Series B preferred stock will automatically convert into common stock at an initial rate of 0.1878395 shares of common stock for each share of Series B preferred stock on the Mandatory Conversion Date. In addition, the Series B preferred stock will mandatorily convert into shares of common stock at the same rate upon the consummation of an initial public offering by Ascent Energy, as defined in the related certificate of designations. In connection with any mandatory conversion, holders will have the right to receive an amount in cash equal to all accrued and unpaid dividends (whether or not earned or declared) on the shares of Series B preferred stock (other than previously declared dividends payable to a holder of record as of a prior date) to and including the conversion date, whether or not declared, out of funds legally available for the payment of dividends. Dividends on the Series B preferred stock will cease to accrue and the shares will cease to be outstanding on the conversion date.

            Liquidation Rights. Upon our voluntary or involuntary liquidation, winding up or dissolution (in connection with our bankruptcy or insolvency or otherwise), the holders of Series B preferred stock will be entitled to receive, out of the assets available for distribution to our stockholders, in preference to any payment or distribution to the holders of our common stock or any other stock ranking junior to the Series B preferred stock, as to dividends, liquidation, dissolution or winding up, $2.50 per share (the "Liquidation Preference") plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid on each share up to and including the date of final distribution to the holders. After the Liquidation Preference and all accrued and unpaid dividends have been paid on the Series B preferred stock, the remaining assets will be paid to the holders of common stock and other junior classes of stock in accordance with their respective priority, if any. In the event our net assets are insufficient to pay the holders of the Series B preferred stock the full amount of their preference set forth above and the holders of any other series of our capital stock ranking on a parity with the Series B preferred stock the liquidating payments to which they are entitled, then our remaining net assets will be divided among and paid to the holders of the shares of Series B preferred stock and any other shares of our capital stock ranking on a parity with the Series B preferred stock ratably per share in proportion to the full per share amounts to which they would be entitled if all amounts payable thereon were paid in full, and the holders of our common stock and other junior classes of stock will receive nothing. Neither a merger or consolidation of Ascent Energy with or into any other corporation or entity nor the sale of all or substantially all of our assets will be deemed to be a liquidation, dissolution or winding up for purposes of determining whether the holders of the Series B preferred stock are entitled to receive the Liquidation Preference as described above.

            Redemption at the Option of Ascent Energy. The Series B preferred stock is redeemable, at our option, in whole or in part, at any time and from time to time, for cash. The cash redemption price per share will be equal to 100% of the liquidation preference, $2.50 per share, plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid on each share up to and including the date fixed for redemption, in immediately available funds. There is no mandatory sinking or retirement fund obligation with respect to the Series B preferred stock.

            At least 20 but not more than 60 days before the redemption date, notice of redemption will be mailed to each holder of record of the Series B preferred stock to be redeemed, at the address shown on our stock transfer books. If fewer than all the outstanding shares of Series B preferred stock are to be redeemed, we will select those shares to be redeemed pro rata. After the redemption date, dividends will cease to accrue on the shares of Series B preferred stock called for redemption. In addition, all rights of the holders of these shares will terminate except the right to receive the redemption price therefor and the right to convert these shares into shares of our common stock until the close of business on the redemption date.

            Voting Rights. Holders of the Series B preferred stock will have no voting rights except as described below or as required by law. In exercising any such vote, each outstanding share of Series B preferred stock will be entitled to one vote. We will not, without the affirmative vote of holders of at least a majority of the outstanding shares of Series B preferred stock, voting together as a single class, amend or waive any of the provisions of our certificate of incorporation or the related certificate of designations, so as to materially and adversely affect any right, preference or privilege of the Series B preferred stock or the holders thereof. Any increase in the amount of authorized preferred stock or the creation or issuance of other series of preferred stock, in each case ranking on a parity with or junior to the Series B preferred stock, will not be deemed to materially and adversely affect such rights, preferences or privileges. However, the authorization or issuance of additional shares of Series B preferred stock or the creation or issuance of other series or classes of preferred stock ranking prior to the Series B preferred stock will be deemed to materially and adversely affect such rights, preferences and privileges.

            Other Provisions. The shares of Series B preferred stock, when issued, will be duly and validly issued, fully paid and nonassessable. The holders of Series B preferred stock have no preemptive rights with respect to any of our securities. The Series B preferred stock has not been approved for listing on any stock exchange. The registrar, transfer agent, conversion agent and dividend disbursing agent for the Series B preferred stock and the transfer agent and registrar for the common stock issuable upon conversion thereof will be Mellon Investor Services LLC.

Common Stock

            Each holder of our common stock is entitled to one vote for each share of common stock held of record on all matters on which stockholders are entitled to vote. In general, the affirmative vote of a majority of the votes entitled to be cast is sufficient for actions that require the vote or concurrence of stockholders. Stockholders may not cumulate votes for the election of directors.

            Subject to any preferences accorded to the holders of our preferred stock, holders of our common stock are entitled to dividends at such times and in such amounts as the board of directors may determine. We have never paid cash dividends on our common stock and do not intend to pay dividends for the foreseeable future. In addition, our new credit facility will contain provisions that limit our ability to pay dividends on our common stock. Upon our dissolution, liquidation or winding up, after payment of debts, expenses and the liquidation preference plus any accrued and unpaid dividends on any outstanding shares of preferred stock, the holders of common stock will be entitled to receive our remaining assets ratably in proportion to the number of shares held by them.

            Holders of our common stock have no preemptive, subscription, cumulative voting, redemption or conversion rights and are not subject to further calls or assessments, or rights of redemption by Ascent Energy. Our outstanding shares of common stock are, and the shares of common stock issuable upon conversion of the preferred stock and the warrants will be, validly issued, fully paid and nonassessable.

Warrants

         General. Subject to final determination by the board of directors, the warrants will entitle the holders therof to purchase an aggregate of approximately 4.4 million shares of our common stock and will expire on June 1, 2011 (the "Warrant Expiration Date"). The warrants will be exercisable at a price per share to be established by our board of directors in connection with the offering of the warrants.  The holders of the warrants will be entitled to exercise all or a portion of their warrants at any time after the date of issuance, and on or prior to the Warrant Expiration Date, at which time all unexercised warrants will expire. If our common stock is traded on a national securities exchange or quoted on the Nasdaq Stock Market, each holder will have the option, in lieu of exercising their warrants for cash, to receive shares of our common stock with an attributed value per share equal to the average of the difference between the daily last sales price reported on the primary national securities exchange, Nasdaq Stock Market or over–the–counter market on which our common stock has been traded or quoted for the preceding 20 business days and the exercise price for each warrant. This summary does not purport to be a complete description of the warrants and is subject to the detailed provisions of, and qualified in its entirety by reference to, the warrants (including the definitions contained therein).

            Merger or Consolidation of Ascent Energy. In case of any consolidation of Ascent Energy with or merger of Ascent Energy into another corporation or entity, or in the case of any sale or conveyance to another person of the property of Ascent Energy as an entirety or substantially as an entirety, the successor or purchasing entity will execute and deliver to the holders of the warrants an agreement that the holders will have the right thereafter upon payment of the exercise price in effect immediately prior to such action to purchase upon the exercise of each warrant the kind and amount of shares and other securities and property such holders would have owned or would have been entitled to receive after the happening of such consolidation, merger, sale or conveyance had their warrants been exercised immediately prior to such action.

            Adjustments of Stock Unit or Exercise Price. The number of shares of common stock issuable upon exercise of a warrant will be adjusted upon the occurrence of certain events including, without limitation, the payment of a stock dividend on our capital stock, the subdivision of our outstanding shares of common stock, the combination of our outstanding shares of common stock into a smaller number of shares, and the issuance of any shares of our capital stock in a reclassification of our common stock. Adjustments will be made whenever and as often as any specified event requires an adjustment to occur, provided that no adjustment will be required until such time as the adjustment would be more than one percent. Any adjustments not required to be made because such adjustment would be less than one percent will be carried forward and taken into account in any subsequent adjustment. Whenever the number of shares of our common stock issuable upon the exercise of the warrants is adjusted, the exercise price will be adjusted by multiplying the exercise price immediately prior to such adjustment by a fraction, the numerator of which is the number of shares purchasable upon the exercise of the warrants and the denominator of which is the number of shares purchasable immediately after such adjustment.

            Amendment. The terms of the warrants may be amended, and the observance of any term of the warrants may be waived, but only with the written consent of the Company and the holders of the warrants.

Certain Provisions of Our Certificate of Incorporation and Bylaws and Delaware Law

            Certain provisions of our certificate of incorporation and bylaws and certain provisions of the Delaware General Corporation Law (the "DGCL"), which are described below, may have the effect, either alone, in combination with each other, or with the existence of authorized but unissued capital stock, of making more difficult or discouraging an acquisition of Ascent Energy that our board of directors deems undesirable.

            Classified Board of Directors. Our certificate of incorporation divides our directors into three classes serving staggered three–year terms. As a result, stockholders will elect approximately one–third of the board of directors each year. This provision, when coupled with the provision of our certificate of incorporation authorizing only the board of directors to fill vacant or newly created directorships that result from an increase the size of the board and the requirement that our directors may only be removed for cause, may deter a stockholder from gaining control of our board of directors by removing incumbent directors or increasing the number of directorships and simultaneously filling the vacancies or newly created directorships with its own nominees.

            Advance Notice of Stockholder Nominations and Stockholder Business. Our bylaws permit a stockholder to nominate a person for election as a director or bring other matters before a stockholders' meeting only if written notice of such stockholder's intent, including such information regarding the nominee as would be required to be included in our proxy statement, has been given to our secretary, generally no less than 120 days or more than 270 days prior to the date upon which we mailed notice and/or proxy materials in connection with the previous year's annual meeting. Any stockholder nomination or proposal that fails to comply with these requirements may be disqualified. These procedures may operate to limit the ability of stockholders to bring business before a stockholders meeting, including the nomination of directors and the consideration of any transaction that could result in a change in control and that may result in a premium to our stockholders.

            Written Consent of Stockholders. Our certificate of incorporation provides that any action required or permitted to be taken by our stockholders may be taken at a duly called meeting of stockholders or by the written consent of stockholders owning the minimum number of shares required to approve the action.

            Special Meetings of Stockholders. Our bylaws provide that special meetings of the stockholders may only be called by the chairman of the board of directors, by the resolution of a majority of our board of directors, or, as described below, by the Secretary. A special meeting must be called by the Secretary when a written request is delivered to such officer by the holders of at least 10% of the issued and outstanding stock entitled to vote at such meeting.

            Limitation of Liability. Our directors will not be personally liable to our company or our stockholders for monetary damages for breach of fiduciary duty as a director, except, if required by Delaware law, for liability:

• for any breach of his or her duty of loyalty to our company or our stockholders;

• for acts or omissions not in good faith or involving intentional misconduct or a knowing violation of law;

• for unlawful payment of a dividend or unlawful stock purchases or redemptions; or

• for any transaction from which he or she derived an improper personal benefit.

            As a result, neither we nor our stockholders have the right, through stockholders' derivative suits on our behalf, to recover monetary damages against a director for breach of fiduciary duty as a director, including breaches resulting from grossly negligent behavior, except in the situations described above.

            Renouncement of Business Opportunities. Our certificate of incorporation provides that stockholders who are entitled to cast 25% or more of our total voting power may engage or invest in businesses that compete with ours.  Our certificate of incorporation also provides that we renounce any interest in any such business opportunities.

            Moreover, our certificate of incorporation provides that if an opportunity in our line of business is presented to a person who is an officer, director or other affiliate of one of our significant stockholders, including any of those individuals who also serves as a director, officer or employee of our company:

• no such officer, director or other affiliate of our significant stockholder has any obligation to communicate or present the opportunity to us; and

• such entity or individual may pursue the opportunity as that entity or individual sees fit, unless it was presented to such individual solely in that person's capacity as a director , officer or employee of our company.

            Thus, for example, a significant stockholder and its affiliates, including its director nominees, may pursue opportunities in the oil and gas exploration and development industry for its own account or present such opportunities to other persons. Accordingly, significant stockholder will not have any obligation to offer such opportunities to us, even if the failure to provide such opportunity would have a competitive impact on us.

            These provisions of our certificate of incorporation may be amended only by an affirmative vote of holders of at least a majority of our total voting power.

            Delaware Anti–Takeover Statute. We are also subject to Section 203 of the DGCL, which prohibits Delaware corporations from engaging in a wide range of specified transactions with any interested stockholder, defined to include, among others, any person other than such corporation and any of its majority–owned subsidiaries who own 15% or more of any class or series of stock entitled to vote generally in the election of directors, unless, among other exceptions, the transaction is approved by

• the board of directors prior to the time the interested stockholder obtained such status, or

• the holders of two–thirds of the outstanding shares of each class or series of stock entitled to vote generally in the election of directors, not including those shares owned by the interested stockholder.

            The provisions described above may tend to deter any potential unfriendly offers or other efforts to obtain control of Ascent Energy that are not approved by our board of directors and thereby deprive the stockholders of opportunities to sell shares of common stock at prices higher than the prevailing market price. On the other hand, these provisions will tend to assure continuity of management and corporate policies and to induce any person seeking control of us or a business combination with us to negotiate or terms acceptable to our then elected board of directors.

COMPARISON OF STOCKHOLDERS' RIGHTS 

            The rights of Pontotoc stockholders are currently governed by the Nevada General Corporation Law and Chapter 92A of the Nevada Revised Statutes, referred to together as the NGCL, and Pontotoc's articles of incorporation and bylaws. Stockholders of Pontotoc who exchange their shares in the offer, will, upon completion of the offer, become holders of our Series B preferred stock, and their rights as such will be governed by the certificate of designations of our Series B preferred stock in addition to the Delaware General Corporation Law or DGCL and our certificate of incorporation and bylaws. Holders of our Series B preferred stock have an option to convert their shares of preferred stock into shares of our common stock. As a result, this comparison of stockholder rights includes a discussion of our common stock. Moreover, until such time of conversion, holders of our Series B preferred stock will have different rights than holders of our common stock, including different conversion, liquidation, redemption, dividend and voting rights. For a more detailed discussion of these rights of the Series B preferred stock, see the section entitled "Description of Ascent Energy Capital Stock – Preferred Stock –– 8% Series B Convertible Preferred Stock" beginning on page 83.

            The NGCL and the DGCL are similar in many respects. The following is a summary of the material differences between the rights of Pontotoc stockholders and the rights of our stockholders. You may want to look at the NGCL and the DGCL and the governing documents described above for the complete provisions. This summary is qualified in its entirety by reference to the NGCL, the DGCL, Pontotoc's articles of incorporation and bylaws, and our certificate of incorporation and bylaws and the certificate of designations of our Series B preferred stock.

Authorized Capital Stock

        Pontotoc

            100,000,000 shares of common stock, $0.0001 par value per share

            5,000,000 shares of preferred stock, $0.0001 par value per share

        Ascent Energy

            20,000,000 shares of common stock, $0.001 par value per share

10,000,000 shares of preferred stock, $0.001 par value per share

Voting Rights

        Pontotoc

            Pontotoc's articles of incorporation provide that each outstanding share of common stock is entitled to one vote on each matter submitted to a vote of stockholders.

        Ascent Energy

            Common Stock. Our certificate of incorporation provides that the holders of common stock shall exclusively possess all voting power, except to the extent the board grants voting rights to any series of preferred stock in connection with the creation thereof.

            Preferred Stock. The certificate of designations of our Series B preferred stock provide that holders of our Series B preferred stock are not entitled to vote such shares, except in limited circumstances. The affirmative vote of the holders of not less than a majority of the shares of Series B preferred stock outstanding, voting together as separate classes, is required to amend or waive any of the provisions of our certificate of incorporation or the certificate of designations in a way that materially and adversely affects any right, preference or privilege of our Series B preferred stock or the holders thereof. In all cases where the holders of our Series B preferred stock have the right to vote such shares, such holders are entitled to one vote per share.

Classes of Directors

        Pontotoc

            Pontotoc's articles of incorporation do not provide for a classified board.

        Ascent Energy

            Our certificate of incorporation provides for a classified board of directors divided into three classes pursuant to which elections are staggered and each director serves a three–year term.

Removal of Directors

        Pontotoc

            Pontotoc's bylaws provide that any or all of the directors may be removed with or without cause only by the holders of at least two–thirds of the voting power of the outstanding stock of the corporation. Additionally, one or more of the directors may be removed for cause by the board of directors.

        Ascent Energy

            Since we have a classified board of directors and our certificate of incorporation does not provide that a director may be removed without cause, our directors may only be removed for cause by the affirmative vote of holders of not less than a majority of the total number of such votes that are entitled to be cast with respect to this matter, voting together as a single class.

Nomination of Directors for Election and Submission of Stockholder Proposals

        Pontotoc

            Pontotoc's articles of incorporation and bylaws do not specify advance notice procedures for the nominations of directors for election and submission of stockholder proposals by the stockholders.

        Ascent Energy

            Our bylaws require that stockholders provide advance notice of nomination of directors and stockholder proposals. Notice for an annual meeting must be made in writing and received by us not more than 270 days and not later than 120 days in advance of the first anniversary of the date on which we mailed notice and/or proxy materials in connection with the preceding year's annual meeting. If the date of the annual meeting or a special meeting is scheduled to be held either 30 days earlier or later than the preceding year's annual meeting, then notice must be received by us within 15 days of the earlier of the date on which notice of such meeting is first mailed to stockholders or public disclosure of the meeting is made.

Anti–Takeover Provisions

        Pontotoc

            Sections 78.411 to 78.444 of the NGCL restrict the ability of a domestic corporation to engage in any combination with an interested stockholder for three years after the interested stockholder's date of acquiring the shares that cause the stockholder to become an interested stockholder, unless the combination or the purchase of shares by the interested stockholder is approved by the board of directors before that date. If the combination was not previously approved, the interested stockholder may effect the combination after the three–year period only if that stockholder receives approval from a majority of the disinterested shares or the offer meets various fair price criteria. An "interested stockholder" means any person who is:

• the beneficial owner, directly or indirectly, of 10% or more of the voting power of the corporation; or

• an affiliate or associate of the corporation who at any time within three years immediately before the date in question was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the corporation.

            The above provisions do not apply to any combination involving a corporation:

• whose original articles of incorporation expressly elect not to be governed by such provisions;

• which does not, as of the date of acquiring shares, have a class of voting shares registered with the SEC under Section 12 of the Securities Exchange Act of 1934, unless the corporation's articles of incorporation provide otherwise;

• whose articles of incorporation were amended to provide that the corporation is subject to the above provisions and which did not have a class of voting shares registered with the SEC under Section 12 of the Securities Exchange Act on 1934 on the effective date of that amendment, if the combination is with an interested stockholder whose date of acquiring shares is before the effective date of such amendment.

            Pontotoc's articles of incorporation do not "opt out" of these provisions.

            The NGCL also contains an acquisition of controlling interest statute. Under sections 78.378 to 78.3793 of the NGCL, a person that acquires or offers to acquire ownership of "control shares" of a corporation (defined as shares obtained pursuant to a transaction in which the acquiring person reaches the 20%, 33% or majority ownership levels) has the right to vote those shares and shares acquired within the previous 90 days, only to the extent granted by a resolution of the stockholders approved at a special or annual meeting.

            The corporation shall, within 50 days after delivery by the acquiring person of certain disclosures, hold a special meeting to consider a resolution authorizing voting rights for the control shares. Unless the corporation's articles of incorporation provide otherwise, a resolution granting voting rights must be approved by a majority vote.

            The corporation may adopt a provision in its articles of incorporation or bylaws allowing mandatory redemption of the control shares if (1) the acquiring party fails to make certain disclosures within ten days of acquiring the control shares or (2) the control shares are not accorded full voting rights at the meeting at which the issue is considered.

            Unless the articles of incorporation or bylaws otherwise provide, if the acquiring party has (1) acquired a majority (or larger) stake and (2) been accorded full voting rights, any holder that did not vote in favor of granting voting rights is entitled to put his or her shares to the corporation for "fair value" (defined as the highest price paid by the acquiring party for control shares).

            These provisions of the acquisition controlling interest apply to any acquisition of a controlling interest unless the articles of incorporation or bylaws of the corporation in effect on the 10th day following the acquisition of a controlling interest by an acquiring person provide that these provisions do not apply to the corporation. Pontotoc's bylaws have been amended to provide that the acquisition of controlling interest statute does not apply to it.

        Ascent Energy

            The DGCL contains a business combination statute that protects domestic corporations from hostile takeovers, and from actions following such a takeover, by prohibiting some transactions once an acquiror has gained a significant holding in the corporation.

            Section 203 of the DGCL prohibits "business combinations," including mergers, sales and leases of assets, issuances of securities and similar transactions by a corporation or a subsidiary with an "interested stockholder" who beneficially owns 15% or more of a corporation's voting stock, within three years after the person or entity becomes an interested stockholder, unless:

• the transaction that will cause the person to become an interested stockholder is approved by the board of directors of the target prior to the transaction;

• after the completion of the transaction in which the person becomes an interested stockholder, the interested stockholder holds at least 85% of the voting stock of the corporation not including (1) shares held by officers and directors of interested stockholders and (2) shares held by specified employee benefit plans; or

• after the person becomes an interested stockholder, the business combination is approved by the board of directors and holders of at least 66–2/3% of the outstanding voting stock, excluding shares held by the interested stockholder.

            A Delaware corporation may elect not to be governed by Section 203 by a provision contained in its original certificate of incorporation or an amendment thereto or to the bylaws, which amendment must be approved by a majority of the shares entitled to vote. We have not made such an election.

Dividends

        Pontotoc

            Except as otherwise provided in the corporation's articles of incorporation, Nevada law authorizes the corporation to make distributions to its stockholders, unless:

• the corporation would not be able to pay its debts as they become due in the usual course of business, or

• the corporation's total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved at the time of distribution to satisfy the preferential rights upon dissolution of stockholders whose preferential rights are superior to those receiving the distribution.

            Pontotoc's articles of incorporation contain no restrictions on the declaration or payment of dividends.

        Ascent Energy

            Delaware corporations may pay dividends out of surplus or, if there is no surplus, out of net profits for the fiscal year in which declared and for the preceding fiscal year. Section 170 of the DGCL also provides that dividends may not be paid out of net profits if, after the payment of the dividend, capital is less than the capital represented by the outstanding stock of all classes having a preference upon the distribution of assets. Our bylaws provide that dividends may be declared by the board of directors at any regular or special meeting, pursuant to the DGCL.

            Stockholders have the right to receive dividends if and when declared by the board. Dividends may be paid in cash, property or shares of capital stock.

            The certificate of designations of our Series B preferred stock provides that holders of our Series B preferred stock are entitled to receive, in preference to any other series or class of stock to which the Series B preferred stock ranks prior, and contemporaneously with any series or class of stock ranking in a parity with the Series B preferred stock, any dividends declared by our board of directors. The holders of our Series B preferred stock are entitled to receive, out of legally available funds, preferential cumulative dividends from the issuance date of the shares at the annual rate of 8% of the liquidation preference of $2.50 per share.

Inspection of Stockholder Lists

        Pontotoc

            Under Nevada law, any person who has been a stockholder of record of a corporation for at least six months, or any person holding or representing at least five percent of its outstanding shares, upon at least five days' written demand, may inspect its stock ledger and make copies from it. A corporation must allow stockholders of record who own or represent at least fifteen percent of a corporation's shares the right, upon at least five days' written demand, to inspect the books of accounting and financial records of the corporation, to make copies from them and to conduct an audit of those records, except that any corporation listed and traded on any recognized stock exchange or any corporation that furnishes to its stockholders a detailed, annual financial statement is exempt from this requirement.

        Ascent Energy

            Delaware law allows any stockholder to inspect the stock ledger and the other books and records of a corporation for a purpose reasonably related to that person's interest as a stockholder.

Indemnification

        Pontotoc

            The NGCL provides that, subject to certain limitations in the case of "derivative" suits brought by a corporation's stockholders in its name, a corporation may indemnify any person who is made a party to any third–party suit or proceeding on account of being a director, officer, employee or agent of the corporation against expenses, including attorney's fees, judgments, fines and amounts paid in settlement reasonably incurred by him or her in connection with the action, through, among other things, a majority vote of a quorum consisting of directors who were not parties to the suit or proceeding, if the person:

• acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation or, in some circumstances, at least not opposed to its best interests, provided that the termination of any action or suit by judgment, order, settlement, conviction or on a plea of Nolo Contendre does not create a presumption by itself that the person did not act in good faith, and

• in a criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful.

            To the extent a director, officer, employee or agent is successful in the defense of such an action, suit or proceeding, the corporation is required by the NGCL to indemnify such person for reasonable expenses incurred thereby.

            Under the NGCL, the articles of incorporation, bylaws or an agreement made by the corporation may provide that the corporation must pay advancements of expenses in advance of the final disposition of the action, suit or proceeding upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined that he is not entitled to be indemnified by the corporation. Neither Pontotoc's articles of incorporation nor its bylaws require the advancement of expenses.

            Pontotoc's articles of incorporation provide that Pontotoc is authorized to provide indemnification of its directors, officers, employees and agents in excess of the indemnification expressly permitted by the NGCL for breach of duty to Pontotoc and its stockholders, subject only to the applicable limits upon such indemnification as set forth in the NGCL.

            Pontotoc's bylaws are silent on the issue of indemnification.

        Ascent Energy

            The DGCL provides that, subject to certain limitations in the case of "derivative" suits brought by a corporation's stockholders in its name, a corporation may indemnify any person who is made a party to any third–party suit or proceeding on account of being a director, officer, employee or agent of the corporation against expenses, including attorney's fees, judgments, fines and amounts paid in settlement reasonably incurred by him or her in connection with the action, through, among other things, a majority vote of a quorum consisting of directors who were not parties to the suit or proceeding, if the person:

• acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation or, in some circumstances, at least not opposed to its best interests; and

• in a criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful.

            To the extent a director, officer, employee or agent is successful in the defense of such an action, suit or proceeding, the corporation is required by the DGCL to indemnify such person for reasonable expenses incurred thereby.

            The DGCL provides that expenses incurred by a director or officer in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of the action, suit or proceeding upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined that he is not entitled to be indemnified by the corporation. Neither our certificate of incorporation or bylaws require the advancement of expenses.

            Our certificate of incorporation provides that our board of directors may adopt bylaws or resolutions, or cause us to enter into contracts, providing for indemnification of officers and directors and other persons to the fullest extent authorized by the DGCL.

            Our bylaws provide that except with respect to an action or claim commenced by a director or officer against us or by a director or officer as a derivative action by or in our right that has not been authorized by our board of directors. We shall indemnify, defend and hold harmless any director or officer against expenses reasonably incurred or suffered in connection with any claim against a director or officer, if (i) the director or officer is successful on the merits or (ii) the director or officer has been found by a determining body, consisting of either impartial directors, independent legal counsel or the stockholders, to have met the appropriate standard of conduct (as determined in accordance with the procedures set forth in the bylaws). Our bylaws also set forth procedures pursuant to which a director or officer must seek indemnification from us.

            In addition, we have entered into indemnity agreements with each of our directors, which provide for indemnification of directors.

Limitations on Directors' and Officers' Liability

        Pontotoc

            Pontotoc's articles of incorporation provide that, to the fullest extent permitted by the NGCL, a director or officer of Pontotoc shall not be personally liable to Pontotoc or any of its stockholders for damages for breach of fiduciary duty as a director or officer, except for liability arising out of:

• acts or omissions which involve intentional misconduct, fraud or a knowing violation of law; or

• payment of a dividend in violation of Section 78.300 of the NGCL.

        Ascent Energy

            Our certificate of incorporation provides that a director (including an officer who is also a director) shall not be liable personally to us or our stockholders for monetary damages for breach of fiduciary duty as a director, except for liability arising out of:

• any breach of the director's duty of loyalty to us or our stockholders;

• acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

• payment of a dividend or approval of a stock repurchase in violation of Section 174 of the DGCL; or

• any transaction from which the director derived an improper personal benefit.

            This provision protects our directors against personal liability for monetary damages from breaches of their duty of care. It does not eliminate the director's duty of care and has no effect on the availability of equitable remedies, such as an injunction or rescission, based upon a director's breach of his or her duty of care. Unlike Pontotoc's articles of incorporation, our certificate of incorporation only protects officers who are also directors.

Transactions Involving Officers or Directors

        Pontotoc

            Under Nevada law, there is no specific provision concerning loans or guarantees. However, under the NGCL and Pontotoc's articles of incorporation, any contract or transaction between Pontotoc and one or more of its officers and directors or between Pontotoc and any corporation, firm or association in which one or more of its directors or officers are directors or officers or financially interested is not void or voidable solely because of such relationship or interest or solely because such director or officer was present at a meeting or joined in the execution of a written consent or votes in favor of the transaction if:

• the director's or officer's interest is made known to the disinterested directors or the stockholders of the corporation, who thereafter approve the transaction in good faith, or the director's or officer's interest is not known to the director or officer at the time the transaction was approved;

• the director's or officer's interest is not known to the director or officer at the time the transaction was approved; or

• the contract or transaction is fair to the corporation as of the time it is approved or ratified by either the board of directors, a committee thereof, or the stockholders.

        Ascent Energy

            A Delaware corporation may lend money to, or guarantee any obligation incurred by, its officers or directors if, in the judgment of the board of directors, the loan or guarantee may reasonably be expected to benefit the corporation. Any other contract or transaction between the corporation and one or more of its directors or officers is neither void nor voidable solely because the interested director or officer was present, participates or votes at the board or board committee meeting that authorizes the contract or transaction, if either:

• the director's or officer's interest is made known to the disinterested directors or the stockholders of the corporation, who thereafter approve the transaction in good faith, or

• the contract or transaction is fair to the corporation as of the time it is approved or ratified by either the board of directors, a committee thereof, or the stockholders.

LEGAL MATTERS

             The validity of our securities offered hereby will be passed upon for us by Jones, Walker, Waechter, Poitevent, Carrere & Denegre, L.L.P., New Orleans, Louisiana.

 INDEPENDENT ACCOUNTANTS

         The balance sheet of Ascent Energy Inc. included herein as of January 19, 2001 has been audited by Arthur Andersen LLP, independent public accountants, as stated in their report with respect thereto, and is included herein in reliance upon the authority of said firm as experts in accounting and auditing in giving such report.

            The financial statements of Forman Petroleum Corporation as of December 31, 2000 and 1999, and for the three years in the period ended December 31, 2000 included herein have been audited by Arthur Andersen LLP, independent public accountants, as stated in their report with respect thereto, and are included herein in reliance upon the authority of said firm as experts in accounting and auditing in giving such report.

            The financial statements of Pontotoc Production, Inc. as of March 31, 1999 and 2000, and for the two years then ended, have been audited by Grant Thornton LLP, independent public accountants, as stated in their report with respect thereto and are incorporated by reference herein in reliance upon the authority of said firm as experts in accounting and auditing in giving such report.

RESERVE ENGINEERS

         Information relating to Ascent Energy's estimated proved oil and gas reserves and the related statements of future cash flows and present values of future net revenues thereof and other related calculations as of December 31, 2000, have been prepared by Netherland, Sewell & Associates, Inc., and we have included it in this prospectus and in the notes to our financial statements in reliance on the authority of said firm as experts in petroleum engineering.

            Information relating to Pontotoc's estimated proved oil and gas reserves and the related statements of future cash flows and present values of future net revenues thereof and other related calculations as of March 31, 2000, have been prepared by Fletcher Lewis Engineering Inc., and has been included or incorporated in this prospectus and in the notes to Pontotoc's financial statements in reliance on the authority of said firm as experts in petroleum engineering.

INDEX TO FINANCIAL STATEMENTS

Ascent Energy Inc.	Page
Report of Independent Public Accountants	F–2
Balance Sheet as of January 19, 2001	F–3
Notes to Balance Sheet	F–4
Forman Petroleum Corporation
Report of Independent Public Accountants	F–6
Balance Sheet as of the Years Ended December 31, 2000 and 1999	F–7
Statements of Operations for the Three Years in the Period Ended December 31, 2000	F–8
Statements of Stockholders' Equity (Deficit) for the Three Years in the Period Ended    December 31, 2000	F–9
Statements of Cash Flows for the Three Years in the Period Ended December 31, 2000	F–10
Notes to Financial Statements	F–11
Pontotoc Production, Inc.
Report of Independent Certified Public Accountants	*
Balance Sheets as of March 31, 2000 and 1999, and December 31, 2000	*
Statements of Earnings for the Years Ended March 31, 2000 and 1999, and the   Nine Months Ended December 31, 2000 and 1999	*
Statement of Stockholders' Equity for the Years Ended March 31, 2000 and 1999	*
Statements of Cash Flows for the Years Ended March 31, 2000 and 1999, and the   Nine Months Ended December 31, 2000 and 1999	*
Notes to Financial Statements	*

 ________________________

*See Pontotoc's Form 10–KSB and Form 10–QSB attached hereto as Annexes C and D, respectively.

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of
Ascent Energy Inc.:

We have audited the accompanying balance sheet of Ascent Energy Inc. (a Delaware corporation) as of January 19, 2001. This financial statement is the responsibility of the Company's management. Our responsibility is to express an opinion on this financial statement based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the balance sheet is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the balance sheet. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the balance sheet referred to above presents fairly, in all material respects, the financial position of Ascent Energy Inc. as of January 19, 2001, in conformity with accounting principles generally accepted in the United States.

New Orleans, Louisiana
March 12, 2001

F -2

ASCENT ENERGY INC.

BALANCE SHEET

JANUARY 19, 2001

ASSETS

TOTAL ASSETS $ –   

LIABILITIES AND STOCKHOLDERS' INVESTMENT

TOTAL LIABILITIES	$	–
STOCKHOLDERS' INVESTMENT
Common stock	1
Additional paid–in capital	999
Stock subscriptions	(1,000)
TOTAL STOCKHOLDERS' INVESTMENT	–
TOTAL LIABILITIES AND STOCKHOLDERS' INVESTMENT	$	–

The accompanying notes are an integral part of this balance sheet.

F -3

ASCENT ENERGY INC.

NOTES TO BALANCE SHEET

JANUARY 19, 2001

1. ORGANIZATION, RESTRUCTURING AND MERGER

Organization

Ascent Energy Inc., a Delaware corporation (the Company), was organized on January 9, 2001, to acquire, through its wholly–owned subsidiary (Pontotoc Acquisition Corp.), Pontotoc Production, Inc. (Pontotoc). The Company's outstanding common stock is represented by 1,000 subscribed, but unpaid, shares of $0.001 par value stock owned in equal halves by TCW Shared Opportunity Fund III, L.P. (TCW), an affiliate of TCW Asset Management Corporation, and Jefferies & Company, Inc. (Jefferies), who also together own controlling interest, subject to certain restrictions, in Forman Petroleum Corporation. The Company expects to engage in the exploration, development and production of oil and gas in the Gulf Coast and mid–continent regions of the United States.

The Company is authorized to issue an aggregate 30,000,000 shares of stock consisting of 20,000,000 shares of $0.001 par value common stock and 10,000,000 shares of $0.001 par value, preferred stock.

Restructuring and Merger

In January 2001, the Company entered into an agreement to acquire all outstanding common stock (5.3 million shares as of March 2001) of Pontotoc. Under the agreement, the consideration for each share of Pontotoc will be $9 in cash and one share of Ascent 8% Series B Convertible Preferred Stock (the Series B Preferred) with a liquidation value of $2.50 per share. This stock will be redeemable by the Company at any time, convertible to common shares at any time at the option of the holder, and will mandatorily convert to common stock of the Company on the two–year anniversary of its issuance, such that the Series B Preferred holders would hold 10% of the fully diluted common stock as of the consummation of the merger. Upon conversion, the Series B Preferred holders would receive cash for accrued and unpaid dividends. The Company will also pay cash of $500,000 to Pontotoc option holders for the difference between $10.50 and the strike price of their options. This acquisition will be accounted for as a purchase and the total consideration is estimated to be approximately $61 million. Upon closing the acquisition, based on the offer, the Company expects to have outstanding 21,100 shares of Series A Preferred stock with a liquidation preference of $21.1 million, 5.3 million shares of Series B Preferred stock with a liquidation preference of $13.3 million and term debt of approximately $30 million.

In connection with this transaction, Forman will acquire all outstanding shares of common stock of the Company, and the Company will become a wholly owned subsidiary of Forman. The Company plans to offer approximately $21.1 million of Series A Preferred stock and warrants to the existing stockholders of Forman on a pro rata basis to help fund the Pontotoc acquisition. The Series A Preferred will have a liquidation preference of $1,000 per share and bear dividends at 8% per annum. The Series A Preferred will be mandatorily redeemable by the Company five years from the date of issuance at liquidation value plus accrued and unpaid dividends. Subject to final determination by the board of directors, the warrants will entitle the holders thereof to purchase approximately 4.4 million shares of Ascent common stock and will have a term of ten years.  The warrants will be exercisable at a price to be determined by the Company's board of directors

F -4

The Company is obligated under the agreement to pay Pontotoc $2 million within five days of termination of the agreement if the termination is due to failure to obtain financing if all other conditions of the agreement have been met. This obligation is guaranteed by Forman.

The Company is negotiating the terms of a credit agreement with its primary lender which will provide the remainder of the funds that will be required to acquire Pontotoc. The credit agreement will be secured by substantially all of the assets of Forman, which will be contributed to the Company concurrently with the acquisition of Pontotoc.

Fiscal Year

The Company's fiscal year will be December 31.

F -5

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS 

To the Stockholders of Forman Petroleum Corporation:

We have audited the accompanying balance sheets of Forman Petroleum Corporation (a Louisiana corporation) as of December 31, 2000 and 1999, and the related statements of operations, stockholders' equity (deficit) and cash flows for the year ended December 31, 2000 (post–confirmation) and the years ended December 31, 1999 and 1998 (pre–confirmation). These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Forman Petroleum Corporation as of December 31, 2000 and 1999, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2000, in conformity with accounting principles generally accepted in the United States.

As discussed in Note 1, effective December 29, 1999, the Company was reorganized under a plan confirmed by the United States Bankruptcy Court in the United States District Court for the Eastern District of Louisiana and adopted a new basis of accounting whereby all remaining assets and liabilities were adjusted to their estimated fair values. Accordingly, financial statements for periods subsequent to the reorganization are not comparable to the financial statements presented for prior periods.

New Orleans, Louisiana,
March 12, 2001

F -6

FORMAN PETROLEUM CORPORATION

BALANCE SHEETS

	December 31,
	2000	1999
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$ 3,728,332	$ 3,180,925
Accounts receivable	135,473	236,663
Oil and gas revenue receivable	2,594,724	1,359,393
Deferred taxes	371,778	-
Unbilled well costs	198	257
Prepaid expenses and tax overpayment	372,960	43,845
Total current assets	7,203,465	4,821,083
PROPERTY AND EQUIPMENT:
Oil and gas properties, full cost method	28,481,661	25,515,529
Unevaluated oil and gas properties	5,006,197	4,732,139
Other property and equipment	287,524	200,000
	33,775,382	30,447,668
Less- accumulated depreciation, depletion and    amortization	(4,484,364)	-
Net property and equipment	29,291,018	30,447,668
OTHER ASSETS:
Escrowed and restricted funds	487,783	490,044
Total assets	$ 36,982,266	$ 35,758,795
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued liabilities	$ 518,760	$ 1,571,710
Undistributed oil and gas revenues	745,024	895,064
Current portion of notes payable	1,219,214	640,608
Total current liabilities	2,482,998	3,107,382
Notes payable	1,309,790	2,066,173
Deferred tax liability	10,788,208	9,900,580
Total liabilities	14,580,996	15,074,135
STOCKHOLDERS' EQUITY:
Common stock, no par value, 10,000,000 shares authorized,      984,042 and 984,032 shares issued and outstanding at      December 31, 2000 and 1999, respectively	20,685,007	20,684,660
Retained earnings	1,716,263	-
Total stockholders' equity	22,401,270	20,684,660
Total liabilities and stockholders' equity	$ 36,982,266	$ 35,758,795

The accompanying notes are an integral part of these financial statements.

F -7

FORMAN PETROLEUM CORPORATION

STATEMENTS OF OPERATIONS

		Years Ended December 31,
			2000		1999		1998
Revenues:
Oil and gas sales		$ 14,696,688		$ 12,992,714		$ 15,950,329
Interest income		186,284		-		239,581
Overhead reimbursements		41,173		64,980		71,325
Other income		36,344		58,292		14,608
	Total revenues	14,960,489		13,115,986		16,275,843
Costs and expenses:
Production taxes		559,334		731,542		540,837
Lease operating expenses		3,353,441		3,146,581		3,359,200
General and administrative expenses		2,656,765		3,013,809		2,774,498
Interest expense		-		6,243,778		10,122,131
Full cost ceiling writedown		-		-		19,575,047
Recapitalization expense		109,130		-		-
Depreciation, depletion and amortization		4,484,364		5,601,733		10,442,032
	Total expenses	11,163,034		18,737,443		46,813,745
Net income (loss) from operations before reorganization   items, income taxes and extraordinary item		3,797,455		(5,621,457)		(30,537,902)
Reorganization items:
Reorganization costs		(898,760)		(1,184,111)		-
Adjust accounts to fair value (Note 1)		-		6,268,022		-
Net income (loss) before income taxes and extraordinary    item		2,898,695		(537,546)		(30,537,902)
Provision (benefit) for income taxes		1,182,432		(188,141)		-
Net income (loss) before extraordinary item		1,716,263		(349,405)		(30,537,902)
Extraordinary gain on extinguishment of debt, net of    taxes of $10,088,721		-		46,724,052		-
Net income (loss)		1,716,263		46,374,647		(30,537,902)
Preferred stock dividends		-		(1,152,991)		(1,729,068)
Net income (loss) attributable to common shares		$ 1,716,263		$45,221,656		$ (32,266,970)
Per common share amounts:
Net income (loss) per share attributable to common    shares before extraordinary item		$ 1.74		$( 16.69)		$(358.52)
Extraordinary item per share		-		519.15		-
Net income (loss) per share		$ 1.74		$ 502.46		$(358.52)
Weighted average basic and diluted shares outstanding		984,042		90,000		90,000

  The accompanying notes are an integral part of these financial statements.

F -8

FORMAN PETROLEUM CORPORATION

STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

Common
Stock Treasury
Stock Additional
Paid-In
Capital Accumulated
Deficit Total

BALANCE, December 31, 1997		$        1,000		$   (10)		$ -	$(24,174,967)		$(24,173,977)
	Net loss	-		-		-	(30,537,902)		(30,537,902)
ACCRETION OF DISCOUNT    ON MANDATORILY            REDEEMABLE PREFERRED STOCK				-		-	(41,666)		(41,666)
ACCRUE DIVIDENDS ON    MANDATORILY REDEEMABLE    PREFERRED STOCK				-		-	(1,729,068)		(1,729,068)
BALANCE, December 31, 1998		$ 1,000		$ (10)		$ -	$(56,483,603)		$(56,482,613)
	Net income	-	-		-			46,374,647		46,374,647
ACCRETION OF DISCOUNT ON    MANDATORILY REDEEMABLE    PREFERRED STOCK		-	-		-			(27,778)		(27,778)
ACCRUE DIVIDENDS ON    MANDATORILY REDEEMABLE    PREFERRED STOCK		-	-		-			(1,152,991)		(1,152,991)
OLD COMMON STOCK    SURRENDERED		(1,000)	10		-			-		(990)
NEW COMMON STOCK ISSUED   IN REORGANIZATION		20,684,660	-		-			-		20,684,660
DISCHARGE OF PREFERRED    STOCK IN REORGANIZATION		-	-		-			13,555,971		13,555,971
FRESH START ACCOUNTING    ADJUSTMENTS (Note 1)		-	-		-			(2,266,246)		(2,266,246)
BALANCE, December 31, 1999		$20,684,660	$    -		$    -			$          -		$20,684,660
NEW COMMON STOCK ISSUED IN    EXCHANGE FOR WARRANTS		347			-			-		347
NET INCOME		-	-		-			1,716,263		1,716,263
BALANCE, December 31, 2000		$20,685,007	$    -		$    -			$ 1,716,263		$22,401,270

The accompanying notes are an integral part of these financial statements.

F -9

FORMAN PETROLEUM CORPORATION

STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2000		1999	1998
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$ 1,716,263	$ 46,374,647		$ (30,537,902)
Adjustments to reconcile net income (loss) to net cash      provided by operating activities-
Extraordinary item	-	(46,724,052)		-
Depreciation and amortization	4,484,364	5,601,733		30,316,309
Deferred income tax provision (benefit)	515,850	(188,141)		-
Adjust accounts to fair value	-	(6,268,022)		-
Interest on obligations discharged in bankruptcy	-	6,144,915		-
Withdrawal from interest escrow account	-	-		3,978,148
Change in assets and liabilities-
Decrease (Increase) in oil and gas revenue receivable	(1,235,331)	(702,960)		1,750,882
Decrease (Increase) in accounts receivable	101,190	(188,833)		550,161
(Increase) Decrease in unbilled well costs	59	11,067		(3,166)
Decrease (Increase) in prepaid expenses and tax      overpayment	(329,115)	253,309		(297,154)
(Decrease) Increase in accounts payable and accrued      liabilities	(1,052,950)	1,500,435		(4,059,766)
(Decrease) Increase in undistributed oil and gas revenues	(150,040)	(473,127)		(258,274)
Increase in interest payable	-	-		5,512,640
Decrease (Increase) in advance to operator		1,200,000		(1,200,000)
Decrease in capitalized recapitalization costs	-	384,313		-
Net cash provided by operating activities	4,050,290	6,925,284		5,751,878
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to oil and gas properties	(3,240,190)	(5,173,645)		(4,523,589)
Reduction of escrow account	2,261	3,437		21,615
Purchase of other property and equipment	(87,524)	(48,639)		(67,964)
Net cash used in investing activities	(3,325,453)	(5,218,847)		(4,569,938)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of notes payable	(177,777)	-		-
Proceeds from sale of common stock	347	-		-
Deferred financing costs	-	-		(165,321)
Net cash used in financing activities	(177,430)	-		(165,321)
NET INCREASE IN CASH AND CASH EQUIVALENTS	547,407	1,706,437		1,016,619
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD	3,180,925	1,474,488		457,869
CASH AND CASH EQUIVALENTS - END OF PERIOD	$ 3,728,332	$ 3,180,925		$ 1,474,488
SUPPLEMENTAL DISCLOSURES:
Cash paid for-
Interest	$ 274,058	$ 82,451		$ 4,609,491
Income taxes	$ 920,500	$ -		$ -

The accompanying notes are an integral part of these financial statements.

F -10

FORMAN PETROLEUM CORPORATION

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2000 AND 1999

1.    OPERATIONS AND REORGANIZATION:

Forman Petroleum Corporation ("Forman" or the "Company"), a Louisiana corporation, is an independent energy company engaged in the exploration, development, acquisition and production of crude oil and natural gas, with operations primarily in the onshore Gulf Coast area of Louisiana. Forman was incorporated in Louisiana in 1982 and began operations in that year.

Restructuring and Merger

In January, 2001, the Company's majority stockholders organized Acsent Energy Inc., a Delaware corporation (Ascent), to acquire Pontotoc Production, Inc. (Pontotoc). Ascent's outstanding common stock is represented by 1,000 subscribed, but unpaid, shares of $0.001 par value stock owned in equal halves by TCW Shared Opportunity Fund, L.P. (TCW), an affiliate of TCW Asset Management Corporation, and Jefferies & Company, Inc. (Jefferies), who also together own controlling interest, subject to certain restrictions, in the Company. Ascent is authorized to issue an aggregate 30,000,000 shares of stock consisting of 20,000,000 shares of $0.001 par value common stock and 10,000,000 shares of $0.001 par value, preferred stock. Ascent expects to engage in the exploration, development and production of oil and gas in the Gulf Coast and mid-continent regions of the United States.

In January 2001, Ascent entered into an agreement to acquire all outstanding common stock (5.3 million shares as of March 2001) of Pontotoc. Under the agreement, the consideration for each share of Pontotoc will be $9 in cash and one share of Ascent's 8% Series B Convertible Preferred Stock (the Series B Preferred) with a liquidation value of $2.50 per share. This stock will be redeemable by Ascent at any time, convertible to common shares at any time at the option of the holder, and will mandatorily convert to common stock of Ascent on the two-year anniversary of its issuance, such that the Series B Preferred holders would hold 10% of the fully diluted common stock of Ascent as of the consummation of the acquisition. Upon conversion, the Series B Preferred holders would receive cash for accrued and unpaid dividends. Ascent will also pay cash of $500,000 to Pontotoc option holders for the difference between $10.50 and the strike price of their options. This acquisition will be accounted for as a purchase and the total consideration is estimated to be approximately $61 million. Upon the closing of the acquisition, based on the offer, Ascent expects to have outstanding 21,100 shares of Series A Preferred stock with a liquidation preference of $21.1 million, 5.3 million shares of Series B Preferred stock with a liquidation preference of $13.3 million and term debt of approximately $30 million.

In connection with this transaction, the Company will acquire all outstanding shares of common stock of Ascent, and Ascent will become a wholly owned subsidiary of Forman. Ascent plans to offer approximately $21.1 million of its Series A Preferred (the Series A Preferred) stock and warrants to the existing stockholders of Forman on a pro rata basis to help fund the Pontotoc acquisition. The Series A Preferred will have a liquidation preference of $1,000 per share and bear dividends at 8% per annum. The Series A Preferred will be mandatorily redeemable by Ascent five years from the date of issuance at liquidation value plus accrued and unpaid dividends.   Subject to final determination by Ascent's board of directors, the warrants will entitle the holders thereof to purchase approximately 4.4 million shares of Ascent common stock and will have a term of ten years. The warrants will be exercisable at a price to be determined by Ascent's board of directors.

Ascent is negotiating the terms of a credit agreement with its primary lender which will provide the remainder of the funds that will be required to acquire Pontotoc. The credit agreement will be secured by substantially all of the assets of the Company, which will be contributed to Ascent concurrently with the acquisition of Pontotoc.

Ascent is obligated under the Agreement to pay Pontotoc $2 million within five days of termination of the Agreement if the termination is due to failure to obtain financing if all other conditions of the Agreement have been met. This obligation is guaranteed by Forman.

F -11

Reorganization

On August 6, 1999, the Company filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States District Court for the Eastern District of Louisiana (the Bankruptcy Court) (Case No. 99-14319). On November 22, 1999, the Company and certain of its creditors filed a Second Amended Joint Plan of Reorganization, as amended on December 29, 1999 (the Bankruptcy Plan). The Company's reorganization plan was confirmed by the Bankruptcy Court on December 29, 1999 and consummated January 14, 2000.

Pursuant to the Bankruptcy Plan, all of the Company's issued and outstanding securities were canceled and, as of December 31, 2000, the Company issued 984,042 shares of common stock, no par value, and warrants to purchase up to 490,516 shares of common stock to the Company's former security holders.

As of the confirmation date, the Company had total assets of $33.9 million and liabilities of $96.0 million. With the exception of an aggregate of approximately $2.7 million of promissory notes issued pursuant to the Bankruptcy Plan, approximately $300,000 in convenience claims which were paid in full in 2000, undistributed oil and gas revenues of $895,000, and approximately $3 million in additional pre-petition bankruptcy claims that were disputed by the Company and have now been resolved before the Bankruptcy Court, all of the Company's liabilities and preferred stock as of the confirmation date were extinguished pursuant to the Bankruptcy Plan.

As of September 30, 2000, the Company had resolved all pre-petition bankruptcy claims that had previously been disputed by the Company. The Bankruptcy Court overruled the Company's objection to one creditor's proof of claim. Thereafter, in accordance with the Bankruptcy Plan, the Company issued the holder of that claim a promissory note in the approximate amount of $984,000 in July, 2000. In addition, on July 24, 2000, the Company compromised its objection to a creditor's proof of claim by paying approximately $501,000 in cash and agreeing to perform future work worth approximately $122,000. The Company's objection to the Louisiana Department of Revenue and Taxation's proof of claim, in the amount of $223,000, was resolved in favor of the Company. As a result, the Company is obligated to pay $119,000 to the Louisiana Department of Revenue and Taxation over six years, with interest, in accordance with the Bankruptcy Plan. Finally, in September and October, 2000, the Company resolved all other disputed proofs of claims, in the aggregate amount of $632,000, by paying approximately $416,000 in cash to the holders of those claims.

All disputed proofs of claim have been resolved. Accordingly, on November 2, 2000, the Company filed a motion for final decree with the Bankruptcy Court to close the Company's bankruptcy case. At the hearing on November 29, 2000, the final decree was granted by the Bankruptcy Court.

Costs incurred during 1999 directly related to the Company's reorganization, consisting primarily of legal, accounting and financial consulting fees, were recorded to reorganization costs in the accompanying statement of operations. These costs are net of interest income earned on cash and cash equivalents because the maintenance of cash balances during 1999 was directly related to the Company's bankruptcy filing.

The Company ceased accruing interest on its Senior Debt and dividends on its preferred stock on August 6, 1999, when it filed for relief under Chapter 11.

Fresh Start Reporting

The Company has accounted for the reorganization using the principles of fresh start accounting required by AICPA Statement of Position 90-7, "Financial Reporting by Entities in Reorganization Under the Bankruptcy Code" (SOP 90-7). For accounting purposes, the accompanying financial statements reflect the confirmed plan as if it was consummated on December 31, 1999. Under the principles of fresh start accounting, the Company's total assets and liabilities were recorded at their estimated fair market values. Accordingly, the Company's net proved oil and gas properties were increased by approximately $3.0 million, its unevaluated oil and gas properties were increased by approximately $3.1 million and other net property and equipment was increased by approximately $0.2 million. Obligations arising from the Bankruptcy Plan were recorded at the amounts expected to be paid in settlements of such obligations. In addition, the Company's Senior Notes with a net book value of $68.6  million, related interest 

F - 12

payable of $11.1 million, preferred stock of $13.6 million and deferred financing costs related to the Senior Notes and preferred stock of $4.4 million were all written off.  Since the former holders of the Company's Senior Notes (the former noteholders) received 92.5% of the shares of the common stock (Note 5), the gain on discharge of indebtedness was computed using 92.5% of the net assets received by the former noteholders. The remaining 7.5% of the net assets allocable to the former holders of the Company's preferred stock was recorded to equity and is included in fresh start accounting adjustments in the accompanying statement of stockholders' equity. Also included in such amount is the write-off of the remaining deferred costs allocable to the preferred stock.

The effect of the Bankruptcy Plan on the Company's balance sheet as of December 31, 1999, is as follows (in thousands):

		Adjustments to Record Confirmation of Plan
	Preconfirmation	Discharge of Debt andPreferred Stock	Fresh Start	Reorganized Balance Sheet
ASSETS
CURRENT ASSETS	$ 4,821	$ -	$ -	$ 4,821
PROPERTY AND EQUIPMENT:
Oil and gas properties, net	24,158	-	6,090	30,248
Other property and equipment	22	-	178	200
DEFERRED FINANCING COSTS, net	4,398	(4,398)	-
ESCROWED AND RESTRICTED FUNDS	490	-	-	490
	$ 33,889	$ (4,398)	$ 6,268	$ 35,759
LIABILITIES AND STOCKHOLDERS'  EQUITY (DEFICIT)
LIABILITIES NOT SUBJECT TO
COMPROMISE:
Accounts payable and accrued liabilities	$ 2,467	$ -	$ -	$ 2,467
Current portion of promissory notes	26	614	-	640
Other noncurrent liabilities	19	-	-	19
Deferred taxes	(2,382)	10,089	2,194	9,901
	130	10,703	2,194	13,027
LIABILITIES SUBJECT TO COMPROMISE:
Prepetition liabilities	2,521	(2,521)	-	-
Promissory notes	-	2,047	-	2,047
Notes payable - secured (including         interest of $11,155)	79,767	(79,767)	-	-
Mandatorily redeemable preferred stock	13,555	(13,555)	-	-
STOCKHOLDERS' DEFICIT:
Common stock - old	1	(1)	-	-
Common stock - new	-	14,417	6,268	20,685
Accumulated deficit	(62,085)	64,279	(2,194)	-
	33,759	(15,101)	4,074	22,732
	$ 33,889	$ (4,398)	$ 6,268	$ 35,759

F - 13

The fair market value assigned to the Company's proved oil and gas properties was estimated by adjusting the net pre-tax future cash flows discounted at a 10% annual rate (PV10) of the Company's proved reserves ($36.4 million at December 31, 1999) as set forth in the Estimate of Reserves and Future Revenue report on the Company's proved oil and gas properties as of December 31, 1999, prepared by Netherland, Sewell & Associates, independent reservoir engineers. This report was prepared in accordance with SEC guidelines, utilizing constant prices existing as of December 31, 1999. The Company adjusted these prices to reflect the product prices used in valuing producing properties, ($21 per barrel of oil and $2.75 per mcf of gas) then applied risk factors to the various categories of proved reserves as follows:

Proved Category	Risk Factor
Proved Producing	95%
Proved Non-producing	75%
Proved Undeveloped	25%

Applying these risk factors and adjusting the product pricing resulted in an estimated fair market value of the proved properties of $25.5 million. The Company's other assets, including other property and equipment, were valued at $4.9 million.

As a result of the implementation of fresh start accounting, the financial statements as of and for the year ended December 31, 1999 reflecting the fresh start accounting principles discussed above are not comparable to the financial statements of prior periods.

2. SIGNIFICANT ACCOUNTING POLICIES:

Oil and Gas Properties

Forman uses the full-cost method of accounting, which involves capitalizing all exploration and development costs incurred for the purpose of finding oil and gas reserves, including the costs of drilling and equipping productive wells, dry hole costs, lease acquisition costs and delay rentals. The Company also capitalizes certain related employee costs and general and administrative costs which can be directly identified with significant acquisition, exploration and development projects undertaken. Such costs are amortized on the future gross revenue method whereby amortization is computed using the ratio of gross revenues generated during the period to total estimated future gross revenues from proved oil and gas reserves. Additionally, the capitalized costs of oil and gas properties cannot exceed the present value of the estimated net cash flow from its proved reserves, together with the lower of cost or estimated fair value of its undeveloped properties (the full cost ceiling). Transactions involving sales of reserves in place, unless extraordinarily large portions of reserves are involved, are recorded as adjustments to accumulated depreciation, depletion and amortization.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents.

Depreciation of Other Property and Equipment

Depreciation of property and equipment other than oil and gas properties is provided on the straight-line method over the estimated useful lives of the assets.

Deferred Financing Costs

For oil and gas property acquisitions which were burdened by an overriding royalty interest assigned to its lenders, the Company allocated a portion of the purchase price of such acquisitions to deferred financing costs. The amount allocated is proportional to the discounted future net cash flows associated with the interest assigned as compared to 

F -14

the total discounted future net cash flows for the acquisition (before carve-out of the overriding royalty interest) as of the date of the acquisition. These allocated costs, along with other costs of obtaining financing, were deferred and amortized using the effective interest method over the original term of the related debt. All such costs were reduced to zero in the reorganization discussed in Note 1.

Fair Value of Financial Instruments

Cash, cash equivalents, accounts receivable, accounts payable and promissory notes were reflected at their fair market values at December 31, 1999, in accordance with SOP 90-7 as discussed in Note 1. As of December 31, 2000, the fair market value of the financial instruments mentioned above approximated their respective book values.

Income Taxes

The income tax effects of the Company's reorganization had a material impact on the tax basis of the Company's oil and gas interests and its net operating loss carryforwards (Note 4).

Pervasiveness of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Recapitalization Costs - 1998

Costs incurred during 1998, consisting primarily of consulting and financial advisory fees, were capitalized in anticipation of the possible debt restructuring or recapitalization of the Company. These costs were written off in 1999 when the Company filed for bankruptcy.

Derivatives

The Company uses derivative financial instruments such as swap agreements and forward sales contracts for price protection purposes on a limited amount of its future production and does not use them for trading purposes. Such derivatives are accounted for on an accrual basis and amounts paid or received under the agreements are recognized as oil and gas sales in the period in which they accrue. For the years ended December 31, 2000, 1999 and 1998, the Company recorded additions to oil and gas sales of $-0-, $109,800 and $-0-, respectively, under these agreements. The Company entered into a forward sales agreement to sell 200 barrels per day of its oil production in October, 1999 for the twelve months ending November 30, 2000, at a price of $22.05 per barrel. As of December 31, 2000 the Company had open forward gas sales positions for the months of January, February and March, 2001 of 60,000 MBTU per month at prices of $7.09, $7.04 and $7.14, respectively.

Certain Concentrations

During 2000, 100% of the Company's oil and gas production was sold to four customers. Based on the current demand for oil and gas, the Company does not believe the loss of any of these customers would have a significant financially disruptive effect on its business or financial condition.

Per Share Amounts

Net income or loss per share of common stock was calculated by dividing net loss applicable to common stock by the weighted-average number of common shares outstanding during the year. Due to the net loss from continuing operations reported in 1998, all options and warrants outstanding (representing 43,600) were excluded from the 

F - 15

computation because they would have been antidilutive. For 2000 and 1999, warrants and options were excluded because the exercise price of outstanding options and warrants (490,516 in 2000 and 43,600 in 1999) exceeded the fair value of the company's common stock.

Recent Accounting Pronouncements

In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities." The Statement establishes accounting and reporting standards that require every derivative instrument (including certain derivative instruments embedded in other contracts) to be recorded in the balance sheet as either an asset or a liability measured at its fair value and that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. The Company adopted SFAS No. 133 on January 1, 2001. Because of the nature of the Company's hedging activities, the adoption of SFAS No. 133 did not have a material impact on the Company's financial position or results of operations.

Reclassifications

Certain prior year amounts have been reclassified to conform to the presentation of such items in the current year.

3. NOTES PAYABLE AND PREFERRED STOCK:

As discussed in Note 1, all of the Company's debt, including accrued interest, and preferred stock were discharged in the reorganization. The Company has issued to certain general unsecured creditors seven promissory notes aggregating to approximately $3.65 million payable beginning April 1, 2000, in equal monthly installments of principal and interest over three years and bearing interest at the rate of 8% per year. Additionally, the Company has notes outstanding of $20,485 related to purchases of automobiles and trucks. Aggregate minimum principal payments at December 31, 2000, required on these notes for the next five years are as follows (in thousands): 2001 - $1,219; 2002 - $1,310; 2003 - $-0-; 2004 - $0; 2005 - $0.

4. INCOME TAXES:

The Company follows the asset and liability method of accounting for deferred income taxes prescribed by the Financial Accounting Standards Board Statement No. 109 (FAS 109) "Accounting for Income Taxes". Under the applicable income tax rules and regulations, the Company is not required to recognize taxable income, or pay taxes on the gain resulting from discharge of indebtedness (DOI) as a result of the Bankruptcy Plan. Rather, the gain (represented for tax purposes as the face value of the debt and accrued interest discharged in excess of the fair market value of the reorganized company) reduces the Company's net operating loss carryforwards (NOLs). Any remaining gain (after offsetting the Company's NOLs) reduces the Company's tax basis in its net assets. The magnitude of the DOI resulted in the elimination of $20.9 million of NOLs from 1998 and $9.6 million of NOLs generated during 1999. Additionally, it substantially eliminated the tax basis in the net assets of the reorganized Company. The significant excess of book basis over tax basis in the net assets of the Company resulted in the recording of a $9.9 million deferred tax liability in the reorganized balance sheet (See Note 1). Realization of the NOLs used to offset the gain on DOI also resulted in the reversal of the valuation allowance, the impact of which is included in the tax effect of the extraordinary item of $10.1 million in the accompanying statement of operations.

The provision for income taxes for the years ended December 31, 1999 and 2000 consisted of the following (in thousands):

	2000	1999
Current	$ 667	$ -
Deferred	515	(188)
Total provision (benefit)	$ 1,182	$ (188)

F - 16

At December 31, the Company has the following deferred tax assets and liabilities recorded (in thousands): 

	2000	1999
Temporary differences:
Oil and gas properties	$ 10,788	9,901
Other	(372)	-
Net deferred tax liability	$ 10,416	$ 9,901

The provision for income taxes (on net loss before extraordinary item) at the Company's effective tax rate differed from the provision for income taxes at the federal statutory rate as follows (in thousands):

	December 31, 2000	December 31, 1999
Computed provision (benefit) at the expected      federal statutory rate	$ 985	$       (188)
State taxes and other	197	-
Income tax provision (benefit)	$     1,182	$       (188)

5. COMMON STOCK AND WARRANTS:

In connection with the consummation of the Bankruptcy Plan, as of December 31, 2000, the Company has issued approximately 984,042 shares of common stock to the former holders of the Company's senior notes and preferred stock. Pursuant to the Bankruptcy Plan, the Company has issued the new shares of common stock upon the surrender of the certificates representing the senior notes and the preferred stock. The common stock was allocated as follows: (i) 13.2143 shares of common stock were issued for each $1,000 of principal amount of canceled Senior Notes and (ii) 0.3120 shares of common stock were issued for each canceled share of preferred stock. The new common stock is subject to a stockholders agreement which contains restrictions on voting, sale and transfer, among other restrictions, of the common stock. Additionally, controlling stockholders (as defined) are entitled under a registration rights agreement to effect up to four registrations of the common stock to be filed on their behalf by the Company. McLain Forman is also entitled to effect up to two registrations under certain conditions (as defined in the agreement).

The Company has also issued, as of December 31, 2000, warrants to purchase up to approximately 490,516 shares of common stock. These warrants consist of 49,048 Series A Warrants (exercise price $34.74), 147,156 Series B Warrants (exercise price $92.80), 147,156 Series C Warrants (exercise price $117.80), and 147,156 Series D Warrants (exercise price $137.80). Each of these warrants is currently exercisable and will automatically expire on January 14, 2007. Of these warrants, approximately 68% of each series was issued to McLain Forman, the former sole shareholder, with the remaining warrants being issued to the former preferred stock and noteholders as described below. Ten Series A Warrants were exercised in 2000.

In connection with the 1997 offerings of Senior Notes and preferred stock, the Company had issued warrants to purchase 43,600 shares of common stock at an initial exercise price of $1.00 per share, subject to adjustment in certain defined cases. The Company had allocated $666,667 and $333,333 of the proceeds received from the sale of the note units and equity units, respectively, to the warrants issued, which had been recorded as additional paid in capital at December 31, 1997. In addition, the Company had also issued warrants to purchase 4,844 shares of common stock under the same conditions as discussed above. The Company recorded $111,100 of additional paid-in capital for these warrants, which was being amortized as deferred financing costs over the term of the note units.

F - 17

Pursuant to the Bankruptcy Plan, holders of the Company's old common stock warrants that were issued in June 1997 in connection with the Company's offering and sale of the Senior Notes received in the aggregate approximately 10,850 Series A Warrants and approximately 32,550 of each of the Series B, Series C, and Series D Warrants. Each holder of a Senior Note warrant received 0.1637 Series A Warrants and 0.4910 Series B, Series C, and Series D Warrants for each Senior Note warrants canceled pursuant to the Bankruptcy Plan. Holders of the Company's warrants that were issued in June 1997 in connection with the Company's offering and sale of the preferred stock (the Equity Warrants) received in the aggregate approximately 5,450 Series A Warrants and approximately 16,350 of each of the Series B, Series C, and Series D Warrants. Each holder of an Equity Warrant received 0.0273 Series A Warrants and 0.0818 Series B, Series C, and Series D Warrants for each Equity Warrant canceled pursuant to the Bankruptcy Plan. McLain Forman received 33,780 Series A Warrants and 101,100 of each of the Series B, Series C, and Series D Warrants in connection with the consummation of the Bankruptcy Plan and pursuant to his employment agreement.

The issuance of the common stock and the warrants pursuant to the Bankruptcy Plan was exempt from registration under the Securities Act of 1933, as amended, pursuant to Section 1145 of the United States Bankruptcy Code.

The warrants had no measurable value upon issuance based on the calculation of their fair value using the Black -Scholes option pricing model.

6. COMMITMENTS AND CONTINGENCIES:

Employment Agreements

Effective January 14, 2000, the Company entered into employment agreements with certain members of executive management. The agreements provide for employment of certain members of executive management in their current positions through April 30, 2001, subject to earlier termination, at a fixed annual salary and an annual bonus based upon the attainment of certain quantitative goals. The agreements provide for aggregate salaries of $961,000 per calendar year to the executives and a maximum bonus of 30% of base salary to each executive, except for the former sole shareholder for whom the maximum bonus is 90% of base salary. The maximum bonuses of $423,000 attributable to fiscal 2000 were recorded in the accompanying financial statements and are payable by March 31, 2001.

If the Company terminates an executive without cause (as defined in the agreement) or the executive terminates employment for good reason (as defined in the agreement), the Company must (i) pay the executive his accrued base salary as of the date of termination plus his annual base salary for the remainder of his employment term and (ii) provide the executive with continuing group medical, dental, disability and life insurance benefits until the later of 18 months from the date of termination or the original expiration date of the employment term. Should the executive prevail in any cause of action, suit, arbitration or other legal proceeding initiated to enforce the provisions of the agreement, the Company indemnifies the executive for all costs including reasonable attorneys' fees incurred by the executive in connection with such cause of action, suit, arbitration or other legal proceeding. If the executive terminates his employment for reasons other than good reason or the Company terminates the executive for cause, the Company must pay to the executive his accrued base salary as of the date of termination. If the executive is terminated for cause following a change of control (as defined in the agreement), the executive will also be paid his base salary for the remainder of his employment term and will be provided continuing group medical, dental, disability and life insurance benefits until the later of 18 months from the date of termination or the original expiration date of the employment term.

F - 18

Operating Leases

Forman has two noncancellable operating leases for the rental of office space, which expire on September 14, 2004 and January 14, 2005. Future commitments under these leases are as follows:

December 31,	Amount
2001	$ 235,544
2002	$ 251,886
2003	$ 257,333
2004	$ 237,260
2005	$ -0-

Rental expense under operating leases during 2000, 1999 and 1998 was $210,480, $240,980, and $200,841, respectively.

Legal Proceedings

From time to time, the Company may be a party to various legal proceedings.  The Company currently is a party to a lawsuit arising in the ordinary course of business.  Management does not expect this matter to have a material adverse effect on the Company's financial position or results of operations.

7. ESCROWED AND RESTRICTED FUNDS:

Cash restricted for payment of abandonment costs for the Boutte and Bayou Dularge Fields is classified as a long-term asset. Such amounts are invested in short-term interest-bearing investments. The cash is escrowed under an agreement which required Forman to make additional specified monthly contributions through November 1995. As of December 31, 2000, the escrow accounts are fully funded.

8. EMPLOYEE BENEFITS:

As part of the reorganization discussed in Note 1, the 1997 Stock Option Plan was dissolved and all outstanding options were cancelled. There was no other activity with respect to the Plan during 2000.

401(K) Plan

The Company has adopted a defined contribution retirement plan that complies with Section 401(k) of the Code (the 401(k) Plan). Pursuant to the terms of the 401(k) Plan, all employees with at least one year of continuous service are eligible to participate and may contribute up to 15% of their annual compensation (subject to certain limitations imposed under the Code). The 401(k) Plan provides that a discretionary match of employee contributions may be made by the Company in cash. In December 1998, the Company made a matching contribution, in the amount of $58,398, based upon each individual employee's plan contributions for 1998. In December, 1999 the Company made another matching contribution, in the amount of $70,012, based upon each individual employee's plan contributions for 1999. During 2000, the Company made matching contributions on a monthly basis, in the aggregate amount of $76,244, based upon each individual employee's plan contributions for 2000. These matching employer contributions to the 401(k) Plan are fully vested to the individual employees after three years of service. The amounts held under the 401(k) Plan are invested among various investment funds maintained under the 401(k) Plan in accordance with the directions of each participant. Employee contributions under the 401(k) Plan are 100% vested and participants are entitled to payment of vested benefits upon termination of employment.

9. WRITEDOWN OF OIL AND GAS PROPERTIES:

During 1998, the Company wrote down its oil and gas properties by $19,575,047. The amount of the writedown represents the excess capitalized costs over estimated future net revenues attributable to oil and gas reserves discounted at 10%, less estimated future income taxes. The estimated future net revenues used in the calculation were based on year-end reserve volumes (as determined by an independent petroleum engineer), using 1998 year end oil prices of $10.44 per barrel and 1998 year end gas prices of $1.87 per thousand cubic feet, with no provision for future escalation. The Company also wrote down its oil and gas property investments during 1997 by $10,008,121. The estimated future net revenues used in the ceiling test calculation for 1997 were based on year-end reserve volumes (as determined by an independent petroleum engineer), utilizing March, 1998 oil prices of $14.47 

F - 19

per barrel and March, 1998 gas prices of $2.40 per thousand cubic feet, with no provision for future escalation. The utilization of these prices resulted in an increase in the amount charged to operations during 1997 of $8,167,879 over the amount that would have been recorded using year-end prices.

10. OIL AND GAS ACTIVITIES:

The following tables provide information required by SFAS No. 69 "Disclosures About Oil and Gas Producing Activities."

Capitalized Costs

Capitalized costs and accumulated depreciation, depletion and amortization relating to the Company's oil and gas producing activities, all of which are conducted within the continental United States, are summarized below:

Year Ended December 31,
2000	1999	1998

Proved producing oil and gas properties	$ 28,481,661	$ 25,515,529	$ 77,067,569
Unevaluated properties	5,006,197	4,732,139	4,485,359
Accumulated depreciation, depletion and      amortization (Note 1)	(4,435,612)	-	(57,938,060)
Net capitalized costs	$ 29,052,246	$ 30,247,668	$ 23,614,868

Costs Incurred

Costs incurred in oil and gas property acquisition, exploration and development activities are summarized below:

	Year Ended December 31,
	2000	1999	1998
Acquisition costs	$ 574,008	$ 81,840	$ -
Exploration costs	46,853	1,745,862	2,413,719
Development costs	1,502,880	3,345,943	2,118,810
Capitalized G&A costs	842,391	-	-
Costs incurred	$ 2,966,132	$ 5,173,645	$ 4,532,529

Gross cost incurred excludes sales of proved and unproved properties which are accounted for as adjustments of capitalized costs with no gain or loss recognized, unless such adjustments would significantly alter the relationship between capitalized costs and proved reserves. For 2000, G&A costs in the amount of $842,000 were capitalized into the full cost pool. No such capitalization of G&A was made for either 1998 or 1999.

The following table discloses financial data associated with the capitalized unevaluated costs as of December 31, 2000:

			Costs incurred during the Year Ended December 31,
		Balance at December 31, 2000	2000	1999
Acquisition costs	$ 4,732,139		$ -	$ 4,732,139
Capitalized interest	274,058		274,058	-
Costs incurred	$ 5,006,197		$ 274,058	$ 4,732,139

F - 20

Reserves - (Unaudited)

Proved reserves are estimated quantities of oil and natural gas which geological and engineering data demonstrate, with reasonable certainty, to be recoverable in future years from known reservoirs under existing economic and operating conditions. Proved developed reserves are proved reserves that can reasonably be expected to be recovered through existing wells with existing equipment and operating methods.

Proved oil and natural gas reserve quantities and the related discounted future net cash flows before income taxes for the periods presented are based on estimates prepared by Ryder Scott Company for 1998 and by Netherland, Sewell & Associates for 1999 and 2000. Both Ryder Scott and Netherland Sewell are independent petroleum engineers. Such estimates have been prepared in accordance with guidelines established by the Securities and Exchange Commission.

The Company's net ownership interests in estimated quantities of proved oil and natural gas reserves and changes in net proved reserves, all of which are located in the continental United States, are summarized below:

Oil, Condensate and Natural Gas Liquids
(Bbls)
Year Ended December 31,
2000	1999	1998

Proved developed and undeveloped reserves:
Beginning of year	1,612,124	1,530,724	2,259,567
Revisions of previous estimates	169,698	273,709	(335,803)
Purchases of oil and gas properties	405,571	-	-
Extensions and discoveries	749,697	151,085	-
Production	(269,899)	(343,394)	(393,040)
End of year	2,667,191	1,612,124	1,530,724
Proved developed reserves at end of year	1,832,778	1,330,675	1,310,274

Natural Gas (Mcf)
Year Ended December 31,
2000	1999	1998

Proved developed and undeveloped reserves:
Beginning of year	18,995,838	14,558,000	22,105,000
Revisions of previous estimates	934,260	3,405,862	(2,602,860)
Purchases of oil and gas properties	1,256,479	-	-
Extensions and discoveries	6,870,554	4,123,150	-
Production	(1,797,305)	(3,091,174)	(4,944,140)
End of year	26,259,826	18,995,838	14,558,000
Proved developed reserves at end of year	12,804,123	13,599,050	9,865,000

F - 21

Standardized Measure (Unaudited)

The table of the Standardized Measure of Discounted Future Net Cash Flows related to the Company's ownership interests in proved oil and gas reserves as of period end is shown below:

Year Ended December 31,
2000	1999	1998
(In Thousands)

Future cash inflows	$ 331,656	$ 88,182	$ 43,256
Future oil and natural gas operating expenses	(43,647)	(29,045)	(14,598)
Future development costs	(17,666)	(7,371)	(5,821)
Future net cash flows before income taxes	270,343	51,766	22,837
Future income taxes	(100,313)	(17,401)	-
Future net cash flows	170,030	34,365	22,837
10% annual discount for estimating timing of     cash flows	(56,585)	(9,962)	(3,668)
Standardized measure of discounted future net      cash flows	$ 113,445	$ 24,403	$ 19,169

Future cash flows are computed by applying year-end prices of oil and natural gas to year-end quantities of proved oil and natural gas reserves. Future operating expenses and development costs are computed primarily by the Company's petroleum engineers by estimating the expenditures to be incurred in developing and producing the Company's proved oil and natural gas reserves at the end of the year, based on year end costs and assuming the continuation of existing economic conditions. Future income taxes are computed using the Company's tax basis in evaluated oil and gas properties and other related tax carryforwards. In 1998, the present value of future net cash flows before income taxes was exceeded by the Company's tax basis in the oil and gas properties and other tax attributes; therefore, future income taxes have not been reflected in that year. The standardized measure of discounted future net cash flows does not purport, nor should it be interpreted, to present the fair value of the Company's oil and natural gas reserves. An estimate of fair value would also take into account, among other things, the recovery of reserves not presently classified as proved, anticipated future changes in prices and costs, a discount factor more representative of the time value of money and the risks inherent in reserve estimates. The weighted average prices of oil and gas used with the above tables at December 31, 2000, 1999 and 1998 were $25.48, $24.58 and $10.44 respectively, per barrel and $10.04, $2.56 and $2.15, respectively, per Mcf. Oil prices have remained relatively stable and natural gas prices have continued to decline almost 50% subsequent to December 31, 2000. Accordingly, the discounted future net cash flows could be decreased if the standardized measure were calculated at a later date.

F - 22

Changes in Standardized Measure (Unaudited)

Changes in standardized measure of future net cash flows relating to proved oil and gas reserves are summarized below:

Year Ended December 31,
	2000	1999	1998
(In Thousands)

Changes due to current year operations:
Sales of oil and natural gas, net of oil and              natural gas operating expenses	$ (11,048)	$ (9,246)	$ (12,050)
Extensions and discoveries	72,785	8,604	-
Purchases of oil and gas properties	9,289	-	-
Changes due to revisions in standardized         variables:
Prices and operating expenses	80,438	10,747	(24,336)
Revisions of previous quantity estimates	12,931	6,897	(4,675)
Estimated future development costs	(8,684)	3,055	(2,192)
Accretion of discount	3,608	1,917	5,226
Net change in income taxes	(57,191)	(12,037)	4,715
Production rates, timing and other	(13,086)	(4,703)	4,939
Net Change	89,042	5,234	(28,373)
Beginning of year	24,403	19,169	47,542
End of year	$ 113,445	$ 24,403	$ 19,169

F - 23

11.    SUMMARIZED QUARTERLY FINANCIAL INFORMATION - UNAUDITED:

The following table summarizes the quarterly financial information for 1999 and 2000. For 2000, the Company capitalized $842,000 of G&A expenses and $274,000 of interest incurred during 2000 into the full cost pool in the fourth quarter. For presentation purposes, the expenses as reported in the respective quarterly Form 10Qs for the first three quarters of 2000 have been restated below to reflect this capitalization ratably over the four quarterly periods of 2000.

	1999
	First Quarter	Second Quarter	Third Quarter	Fourth Quarter	Total
Revenues	$2,625,787	$2,945,597	$3,806,493	$3,738,109	$13,115,986
Expenses	6,584,445	6,846,622	4,930,491	375,885	18,737,443
Net income (loss) from operations	(3,958,658)	(3,901,025)	(1,123,998)	3,362,224	(5,621,457)
Reorganization items and income taxes	-	-	-	(5,272,052)	(5,272,052)
Net income (loss) before extraordinary items	(3,958,658)	(3,901,025)	(1,123,998)	8,634,276	(349,405)
Extraordinary items	-	-	-	46,724,052	46,724,052
Net income (loss)	(3,958,658)	(3,901,025)	(1,123,998)	55,358,328	46,374,647
Preferred stock dividend	473,539	479,164	200,288	-	1,152,991
Net income (loss) attributable to common shares	$(4,432,197)	$(4,380,189)	$(1,324,286)	$55,358,328	$45,221,656
Basic and diluted earnings (loss) per share:
Net income (loss) per share attributable to common shares before extraordinary item	$(49.25)	$(48.67)	$(14.71)	$ 95.94	$ (16.69)
Extraordinary item per share	-	-	-	519.15	519.15
Net income (loss) per share	$(49.25)	$(48.67)	$(14.71)	$615.09	$502.46
	2000
	First Quarter	Second Quarter	Third Quarter	Fourth Quarter	Total
Revenues	$3,382,051	$3,241,941	$3,762,392	$4,574,105	$14,960,489
Expenses	2,504,620	2,687,521	3,265,193	2,705,700	11,163,034
Net income (loss) from operations	877,431	554,420	497,199	1,868,405	3,797,455
Reorganization items and income taxes	1,196,317	-	76,330	808,545	2,081,192
Net income (loss)	$(318,886)	$554,420	$420,869	$1,059,860	$1,716,263
Basic and diluted earnings (loss) per share:	$(0.32)	$0.56	$0.43	$1.07	$1.74

F - 24

Annex A

AGREEMENT AND PLAN OF MERGER

Among

ASCENT ENERGY INC.

PONTOTOC ACQUISITION CORP.

and

PONTOTOC PRODUCTION, INC

Dated as of January 19, 2001

TABLE OF CONTENTS

 

ARTICLE I.	THE OFFER	1
Section 1.1	The Offer	1
Section 1.2	Company Action	3
Section 1.3	Directors	4
ARTICLE II.	THE MERGER	4
Section 2.1	The Merger	5
Section 2.3	Effect of the Merger	5
Section 2.4	Articles of Incorporation; Bylaws	5
Section 2.5	Directors and Officers	5
Section 2.6	Effect on Capital Stock	6
Section 2.7	Exchange of Certificates	6
Section 2.8	No Further Ownership Rights in Company Common Stock	9
Section 2.9	Stock Options	9
Section 2.10	Taking of Necessary Action; Further Action	9
Section 2.11	Dissenting Shares	9
ARTICLE III.	REPRESENTATIONS AND WARRANTIES OF COMPANY	10
Section 3.1	Organization; Subsidiaries	10
Section 3.2	Company Capitalization	11
Section 3.3	Obligations With Respect to Capital Stock	12
Section 3.4	Authority; Non–Contravention	12
Section 3.5	SEC Filings Company Financial Statements	13
Section 3.6	Undisclosed Liabilities	14
Section 3.7	Absence of Certain Changes or Events	15
Section 3.8	Taxes	15
Section 3.9	Title to Assets	18
Section 3.10	Real Property Other Than Oil and Gas Interests	18
Section 3.11	Title to Oil and Gas Interests	18
Section 3.12	Oil and Gas Interests of Company and its Subsidiaries	19
Section 3.13	Refund	19
Section 3.14	Payout Balances	19
Section 3.15	Operations	20
Section 3.21	Litigation	21
Section 3.22	Employee Benefit Plans	22
Section 3.23	Certain Agreements	25
Section 3.24	Environmental Matters	26
Section 3.25	Brokers' and Finders' Fees	28
Section 3.26	Insurance	28
Section 3.27	Disclosure	29
Section 3.28	Fairness Opinion	29
Section 3.29	Affiliates	29
Section 3.30	Disclosure	29
ARTICLE IV.	REPRESENTATIONS AND WARRANTIES OF PARENT	30
Section 4.1	Organization of Parent and Subsidiaries	30
Section 4.2	Capitalization	30
Section 4.3	Obligations With Respect to Capital Stock	31
Section 4.4	Authority; Non–Contravention	32
Section 4.5	Title to Oil and Gas Interests	32
Section 4.6	Oil and Gas Interests of Parent and Its Subsidiaries	32
Section 4.7	Refund	33
Section 4.9	Operations	34
Section 4.10	Plugging Status	34
Section 4.11	Financial and Commodity Hedging	34
Section 4.12	Governmental Regulation	34
Section 4.13	Compliance with Laws	34
Section 4.15	Brokers' and Finders' Fees	35
Section 4.16	Disclosure Documents	35
Section 4.17	SEC Reports; Forman Financial Statements	35
Section 4.18	Undisclosed Liabilities	36
Section 4.19	Absence of Certain Changes or Events	36
Section 4.20	Reserve Report	37
Section 4.21	Disclosure	37
ARTICLE V.	CONDUCT PRIOR TO THE EFFECTIVE TIME	37
Section 5.1	Conduct of Business by Company	37
ARTICLE VI.	ADDITIONAL AGREEMENTS	39
Section 6.1	Stockholder Approval; Preparation of Registration Statement and Proxy Statement/Prospectus	39
Section 6.2	No Solicitation	41
Section 6.3	Obligations of Merger Sub.	43
Section 6.4	Voting of Shares	43
Section 6.5	Registration Statement	43
Section 6.7	Public Disclosure	44
Section 6.8	Reasonable Best Efforts; Notification	44
Section 6.9	Indemnification	46
Section 6.10	Letters of Accountants	46
Section 6.11	Takeover Statutes	46
Section 6.12	Certain Employee Benefits	46
Section 6.13	Employment Agreement	47
Section 6.4	Transfer Taxes	47
Section 6.15	Forman Restructuring	47
Section 6.16	Pontotoc Gathering Restructuring	47
Section 6.17	Financing	47
Section 6.18	Hedging Program	47
ARTICLE VII.	CONDITIONS TO THE MERGER	48
Section 7.1	Conditions to Obligations of Each Party to Effect the Merger	48
ARTICLE VIII.	TERMINATION, AMENDMENT AND WAIVER	48
Section 8.1	Termination	48
Section 8.2	Notice of Termination; Effect of Termination	49
Section 8.3	Fees and Expenses	50
Section 8.4	Amendment	51
Section 8.5	Extension; Waiver	51
ARTICLE IV.	GENERAL PROVISIONS	51
Section 9.1	Non–Survival of Representations and Warranties	51
Section 9.2	Notices	52
Section 9.3	Interpretation; Certain Defined Terms	52
Section 9.4	Counterparts	53
Section 9.5	Entire Agreement; Third Party Beneficiaries	53
Section 9.6	Severability	53
Section 9.7	Other Remedies; Specific Performance	54
Section 9.8	Governing Law	54
Section 9.9	Rules of Construction	54
Section 9.10	Assignment	54
Section 9.11	Waiver of Jury Trial	54
ANNEX I	CONDITIONS TO THE OFFER	I–1
EXHIBIT A	CERTIFICATE OF DESIGNATIONS	A–1
EXHIBIT B	STOCKHOLDERS' AGREEMENT	B–1

AGREEMENT AND PLAN OF MERGER

         This AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered into as of January 19, 2001, by and among Ascent Energy Inc., a Delaware corporation ("Parent"), Pontotoc Acquisition Corp., a Nevada corporation and a direct wholly–owned subsidiary of Parent ("Merger Sub"), and Pontotoc Production, Inc., a Nevada corporation ("Company").

 R  E  C  I  T  A  L  S

         A.    The respective Boards of Directors of Parent, Merger Sub and Company have determined that it is advisable and in the best interest of each corporation and their respective shareholders to effect a business combination between Parent and Company upon the terms and subject to the conditions set forth herein.

         B.    The respective Boards of Directors of Parent, Merger Sub and Company have approved (i) this Agreement, and declared advisable that Merger Sub make an exchange offer (the "Offer") to purchase all of the issued and outstanding shares of common stock, par value $0.0001 per share ("Company Common Stock"), of Company ("Shares") in exchange for cash and shares of preferred stock, par value $0.01 per share, of Parent, having the rights, preferences and designations set forth in the Certificate of Designations attached hereto as Exhibit A ("Parent Preferred Stock"), and (ii) the merger of Merger Sub with Company (the "Merger") upon the terms and subject to the conditions of this Agreement and in accordance with the General Corporation Law of the State of Nevada ("Nevada Law").

         C.    Concurrently with the execution of this Agreement, and as a condition and inducement to Parent's willingness to enter into this Agreement, certain stockholders of Company are entering into a Stockholders' Agreement with Parent in the form of Exhibit B (the "Stockholders' Agreement").

        NOW THEREFORE, in consideration of the premises and of the mutual covenants, representations, warranties and agreements set forth herein, the parties hereto agree as follows:

ARTICLE I.
THE OFFER

        Section 1.1    The Offer.    (a) Provided that (i) this Agreement shall not have been terminated in accordance with Section 8.1 and (ii) none of the events set forth in Annex I shall have occurred and be continuing, Merger Sub shall, as promptly as reasonably practicable after the date hereof, commence the Offer. Each Share accepted by Merger Sub pursuant to the Offer shall be exchanged for the right to receive from Merger Sub $9.00, net to the holder, in cash, and shares of Parent Preferred Stock having a liquidation preference equal to $2.50. The initial expiration date of the Offer shall be the 20th business day following commencement of the Offer. The Offer shall be subject to the condition that there shall be validly tendered in accordance with the terms of the Offer prior to the expiration date of the Offer and not withdrawn a number of Shares which, together with the Shares then owned by Parent and Merger Sub (if any), represents at least two–thirds of the total number of outstanding shares of Company Common Stock, assuming the exercise of all currently exercisable options, rights and convertible securities (if any) and the issuance of all shares of Company Common Stock that Company is obligated to issue thereunder (such total number of outstanding shares of Company Common Stock being hereinafter referred to as the "Fully Diluted Shares") (the "Minimum Condition"), and to the other conditions set forth in Annex I. Parent and Merger Sub expressly reserve the right to waive any of conditions to the Offer and to make any change in the terms or conditions of the Offer; provided, that, without the prior written consent of Company, no change may be made which (i) decreases the number of Shares to be purchased in the Offer; (ii) changes the form or amount of consideration to be paid; (iii) imposes conditions to the Offer in addition to those set forth in Annex I; (iv) changes or waives the Minimum Condition or any of the other conditions set forth in Annex I; (v) extends the Offer (except as set forth in the following two sentences); or (vi) makes any other change to any of the terms of or conditions to the Offer which is adverse to the holders of Shares. Subject to the terms of the Offer and this Agreement and the satisfaction (or waiver to the extent permitted by this Agreement) of the conditions to the Offer, Merger Sub shall accept for payment all Shares validly tendered and not withdrawn pursuant to the Offer as soon as practicable after the applicable expiration date of the Offer and shall pay for all such Shares promptly after acceptance; provided, that (x) Merger Sub may, in its sole discretion, extend the Offer for successive extension periods not in excess of 10 business days per extension if, at the scheduled expiration date of the Offer or any extension thereof, any of the conditions to the Offer shall not have been satisfied, until such time as such conditions are satisfied or waived, but in no event later than the End Date (as defined in Section 8.1(b)(ii)) and (y) Merger Sub may, in its sole discretion, extend the Offer if and to the extent required by the applicable rules and regulations of the Securities and Exchange Commission (the "SEC"). In addition, Merger Sub may, in its sole discretion, extend the Offer, after the acceptance of Shares thereunder, for a further period of time by means of a subsequent offering period under Rule 14d–11 promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), of not more than 10 business days to meet the objective (which is not a condition to the Offer) that there be validly tendered, in accordance with the terms of the Offer, prior to the expiration date of the Offer (as so extended), and not withdrawn, a number of Shares which, together with Shares then owned by Parent and Merger Sub, represents at least 90% of the Shares. Notwithstanding anything to the contrary set forth herein, no certificates or scrip representing fractional shares of Parent Preferred Stock shall be issued in connection with the exchange of cash and Parent Preferred Stock for Shares upon consummation of the Offer, and the number of shares of Parent Preferred Stock shall be rounded up to the nearest whole number.

        (b)    As soon as reasonably practicable after the date of this Agreement, Parent shall prepare and file with the SEC a registration statement on Form S–4 to register the offer and sale of Parent Preferred Stock pursuant to the Offer (the "Registration Statement"). The Registration Statement will include a preliminary prospectus containing the information required under Rule 14d–4(b) promulgated under the Exchange Act (the "Preliminary Prospectus"). As soon as reasonably practicable on the date of commencement of the Offer, Parent and Merger Sub shall (i) file with the SEC a Tender Offer Statement on Schedule TO with respect to the Offer which will contain or incorporate by reference all or part of the Preliminary Prospectus and form of the related letter of transmittal (together with any supplements or amendments thereto, collectively the "Offer Documents") and (ii) cause the Offer Documents to be disseminated to holders of Shares. Each of Parent, Merger Sub and Company agrees promptly to correct any information provided by it for use in the Registration Statement or the Offer Documents if and to the extent that such information shall have become false or misleading in any material respect. Parent and Merger Sub agree to take all steps necessary to cause the Offer Documents as so corrected to be filed with the SEC and to be disseminated to holders of Shares, in each case as and to the extent required by applicable federal securities laws. Company and its counsel shall be given a reasonable opportunity to review and comment on the Schedule TO, the Registration Statement and the Offer Documents and any material amendments thereto prior to their being filed with the SEC.

        Section 1.2     Company Action.    (a) Company hereby consents to the Offer and represents that its Board of Directors, at a meeting duly called and held, has duly (i) determined that this Agreement and the transactions contemplated hereby, including the Offer and the Merger, are advisable and are fair to and in the best interest of Company and its stockholders, (ii) approved and adopted this Agreement and the transactions contemplated hereby, including the Offer and the Merger, which approval constitutes approval under Sections 92A.120 and 78.438 of Nevada Law such that the Offer, the Merger, this Agreement and the other transactions contemplated hereby are not and shall not be subject to any restriction pursuant to Sections 78.438 of Nevada Law, and (iii) resolved to recommend acceptance of the Offer and approval and adoption of this Agreement and the Merger by Company's stockholders (the recommendations referred to in this clause (iii) are collectively referred to in this Agreement as the "Recommendations"). Company further represents that C.K. Cooper and Company has rendered to Company's Board of Directors its oral opinion, to be followed by a written opinion, that the consideration to be received by Company's stockholders pursuant to this Agreement is fair to such stockholders from a financial point of view. Company has been advised that all of its directors and executive officers currently intend to tender their Shares pursuant to the Offer.

        (b)    As soon as practicable after the Offer is commenced, Company will file with the SEC and disseminate to holders of Shares a Solicitation/Recommendation Statement on Schedule 14D–9 (the "Schedule 14D–9") which shall, subject to Section 6.2(b), reflect the Recommendations. Each of Company, Parent and Merger Sub agrees promptly to correct any information provided by it for use in the Schedule 14D–9 if and to the extent that such information shall have become false or misleading in any material respect. Company agrees to take all steps necessary to cause the Schedule 14D–9, as so corrected, to be filed with the SEC and to be disseminated to holders of Shares, in each case as and to the extent required by applicable federal securities laws. Parent and its counsel shall be given a reasonable opportunity to review and comment on the Schedule 14D–9 and any material amendments thereto prior to their being filed with the SEC.

        (c)    Company will promptly furnish Parent and Merger Sub with a list of its stockholders, mailing labels (to the extent available) and any available listing or computer file containing the names and addresses of all record holders of Shares and lists of securities positions of Shares held in stock depositories, in each case as of the most recent practicable date, and will provide to Parent and Merger Sub such additional information (including updated lists of stockholders, mailing labels and lists of securities positions) and such other assistance as Parent or Merger Sub may reasonably request in connection with the Offer.

        Section 1.3    Directors.    (a) Effective upon the acceptance for payment of, and payment by Merger Sub for, Shares equal to at least a majority of the outstanding shares of Company Common Stock pursuant to the Offer (the "Appointment Time"), Parent shall be entitled to designate the number of directors, rounded up to the next whole number, on Company's Board of Directors that equals the product of (i) the total number of directors on Company's Board of Directors (giving effect to the election of any additional directors pursuant to this Section 1.3) and (ii) the percentage that the number of Shares owned by Parent or Merger Sub (including all Shares purchased pursuant to the Offer) bears to the total number of Shares, and Company shall take all action reasonably necessary to cause Parent's designees to be elected or appointed to Company's Board of Directors, including increasing the number of directors, or seeking and accepting resignations of incumbent directors, or both. At such time, Company will also use its best efforts to cause individuals designated by Parent to constitute the number of members, rounded up to the next whole number, on (i) each committee of the Board and (ii) each Board of Directors of each subsidiary of Company (and each committee thereof) that represents the same percentage as such individuals represent on the Board of Directors of Company. Notwithstanding the provisions of this Section 1.3, the parties hereto shall use their respective best efforts to ensure that at least two of the members of Company's Board of Directors shall, at all times prior to the Effective Time (as defined below), be Directors of Company who were directors of Company prior to consummation of the Offer (each, a "Continuing Director"). If the number of Continuing Directors is reduced to less than two for any reason prior to the Effective Time, the remaining and departing Continuing Directors shall be entitled to designate a person to fill the vacancy. Notwithstanding anything in this Agreement to the contrary, if Parent's designees are elected to Company's Board of Directors prior to the Effective Time, the affirmative vote of the Continuing Directors shall be required for Company to (a) amend or terminate this Agreement or agree or consent to any amendment or termination of this Agreement, (b) waive any of Company's or any Company stockholder's rights, benefits or remedies hereunder, (c) extend the time for performance of Parent's and Merger Sub's respective obligations hereunder, or (d) approve any other action by Company which is reasonably likely to adversely affect the interests of the stockholders of Company (other than Parent, Merger Sub and their affiliates (other than Company and its subsidiaries)), with respect to the transactions contemplated by this Agreement.

        (b)    Company's obligations to appoint designees to its board of directors shall be subject to Section 14(f) of the Exchange Act and Rule 14f–l promulgated thereunder. Company shall promptly take all actions required pursuant to Section 1.3 and Rule 14f–l in order to fulfill its obligations under this Section 1.3 and shall include in the Schedule 14D–9 such information with respect to Company and its officers and directors as is required under said Section 14(f) and Rule 14f–l to fulfill its obligations under this Section 1.3. Parent will supply to Company in writing and be solely responsible for any information with respect to itself and its nominees, officers, directors and affiliates required by said Section 14(f) and Rule 14f–1.

ARTICLE II.
THE MERGER

        Section 2.1     The Merger.    Upon the terms and subject to the conditions of this Agreement and the applicable provisions of Nevada Law, at the Effective Time, Merger Sub shall be merged with and into Company, the separate corporate existence of Merger Sub shall cease, and Company shall continue as the surviving corporation of the Merger; provided, however, if Merger Sub owns at least 90% of the total number of outstanding shares of Company Common Stock, Merger Sub may effectuate the Merger pursuant to Section 92A.180 of Nevada Law, and Company shall be merged with and into Merger Sub, in which case, the separate corporate existence of Company shall cease, and Merger Sub shall continue as the surviving corporation. In either case, the entity surviving the Merger, Company or Merger Sub, as the case may be, shall be referred to hereinafter as the "Surviving Corporation".

        Section 2.2     Effective Time; Closing.    Subject to the provisions of this Agreement, Company and Merger Sub will file articles of merger, in such appropriate form as determined by the parties, with the Secretary of State of the State of Nevada in accordance with the relevant provisions of Nevada Law (the "Articles of Merger"), as soon as practicable on or after the Closing Date (as defined below). The closing of the Merger (the "Closing") shall take place at the offices of Jones, Walker, 201 St. Charles Avenue, New Orleans, Louisiana, at a time and date to be specified by the parties, which shall be no later than the second business day after the satisfaction or waiver of the conditions set forth in Article VII (excluding conditions that, by their nature, cannot be satisfied until the Closing), or at such other time, date and location as the parties hereto agree in writing (the "Closing Date"). The Merger shall become effective at such time as the Articles of Merger are filed with the Secretary of State of the State of Nevada or such other time as is specified in the Articles of Merger (the "Effective Time").

        Section 2.3     Effect of the Merger.    At the Effective Time, the effect of the Merger shall be as provided in this Agreement and the applicable provisions of Nevada Law. Without limiting the generality of the foregoing, at the Effective Time, the Surviving Corporation shall possess all the property, rights, privileges, powers and franchises of Company and Merger Sub, and shall be subject to all debts, liabilities and duties of Company and Merger Sub.

        Section 2.4     Articles of Incorporation; Bylaws.    (a) At the Effective Time, the Articles of Incorporation of Merger Sub, as in effect immediately prior to the Effective Time, shall be the Articles of Incorporation of the Surviving Corporation until thereafter amended as provided by law and such Articles of Incorporation of the Surviving Corporation; provided, however, that at the Effective Time Article I of the Articles of Incorporation of the Surviving Corporation shall be amended to read: "The name of the corporation is "Pontotoc Production, Inc."."

        (b)     At the Effective Time, the Bylaws of Merger Sub, as in effect immediately prior to the Effective Time, shall be the Bylaws of the Surviving Corporation until thereafter amended.

        Section 2.5     Directors and Officers.    The initial directors of the Surviving Corporation shall be the directors of Merger Sub immediately prior to the Effective Time, until their respective successors are duly elected or appointed and qualify, unless they earlier die, resign or are removed. The initial officers of the Surviving Corporation shall be the officers of Merger Sub immediately prior to the Effective Time, until their respective successors are duly elected or appointed and qualify, unless they earlier die, resign or are removed.

        Section 2.6     Effect on Capital Stock.    Subject to the terms and conditions of this Agreement, at the Effective Time, by virtue of the Merger and without any action on the part of Merger Sub, Company or the holders of any of the following securities:

        (a)     Conversion of Company Common Stock.     Each share of Company Common Stock issued and outstanding immediately prior to the Effective Time, other than any shares of Company Common Stock to be canceled pursuant to Section 2.6(b), shall be canceled and extinguished and automatically converted into the right to receive from Merger Sub the same amount of cash, without interest, and the same number of shares of Parent Preferred Stock paid in the Offer upon surrender of the certificate representing such share of Company Common Stock in the manner provided in Section 2.7 (the "Merger Consideration"). No fraction of a share of Parent Preferred Stock will be issued by virtue of the Merger, but, in lieu thereof, the number of shares of Parent Preferred Stock to be issued shall be rounded up to the next whole number.

        (b)     Cancellation of Company–Owned and Parent–Owned Stock.     Each share of Company Common Stock held by Company or owned by Parent or Merger Sub immediately prior to the Effective Time shall be canceled and extinguished without any conversion thereof.

        (c)     Capital Stock of Merger Sub.     Each share of common stock, par value $0.001 per share, of Merger Sub (the "Merger Sub Common Stock"), issued and outstanding immediately prior to the Effective Time shall be converted into one validly issued, fully paid and nonassessable share of common stock, $0.001 par value per share, of the Surviving Corporation. Following the Effective Time, each certificate evidencing ownership of shares of Merger Sub common stock shall evidence ownership of such shares of common stock of the Surviving Corporation.

        (d)     Adjustments to Merger Consideration.     If, during the period between the date of this Agreement and the Effective Time, any change in the outstanding shares of capital stock of Parent or Company shall occur, including by reason of any reclassification, recapitalization, stock split or combination, exchange or readjustment of shares, or any stock dividend thereon with a record date during such period, the Merger Consideration and any other amounts payable pursuant to the Offer, the Merger or otherwise pursuant to this Agreement shall be appropriately adjusted.

        Section 2.7     Exchange of Certificates.    (a) Exchange Agent.     Prior to the Effective Time, Parent shall select an institution reasonably acceptable to Company to act as the exchange agent (the "Exchange Agent") in the Merger.

        (b)     Exchange Fund.     Promptly after the Effective Time, Parent shall deposit with the Exchange Agent, as nominee for the benefit of the holders of Company Common Stock, the aggregate amount of cash and the aggregate number of shares of Parent Preferred Stock to be issued pursuant to Section 2.6(a) (such cash and shares of Parent Preferred Stock, together with any dividends or distributions with respect thereto being hereinafter referred to as the "Exchange Fund"), to be held for the benefit of and distributed to the holders of Company Common Stock in accordance with this Section 2.7. The Exchange Agent shall invest any cash included in the Exchange Fund as directed by the Surviving Corporation on a daily basis in direct obligations of the United States, obligations for which the full faith and credit of the United States is pledged to provide for the payment of principal and interest, commercial paper rated the highest quality by Moody's Investors Services, Inc. or Standard & Poor's Ratings Group, or certificates of deposit, bank repurchase agreements or bankers' acceptances of a commercial bank having at least $100,000,000 in assets, or in money market funds which are invested in the foregoing; provided that no such investment or loss thereon shall affect the amounts payable to the Company's stockholders pursuant to this Article II. Parent and the Surviving Corporation shall replace any monies lost through an investment made pursuant to this Section 2.7(b). Any interest and other income resulting from such investments, over and above amounts necessary to be distributed to the holders of Company Common Stock, shall promptly be paid to the Surviving Corporation.

        (c)     Exchange Procedures.     Promptly after the Effective Time, Parent shall instruct the Exchange Agent to mail to each holder of record of a certificate or certificates ("Certificates") which immediately prior to the Effective Time represented outstanding shares of Company Common Stock whose shares were converted into the right to receive cash and shares of Parent Preferred Stock pursuant to Section 2.6: (i) a letter of transmittal in customary form (that shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates to the Exchange Agent and shall contain such other provisions as Parent may reasonably specify, subject to the approval of Company, which approval shall not be unreasonably withheld) and (ii) instructions for use in effecting the surrender of the Certificates in exchange for the amount of cash and a certificate or certificates representing shares of Parent Preferred Stock. Upon surrender of Certificates for cancellation to the Exchange Agent together with such letter of transmittal, duly completed and validly executed in accordance with the instructions thereto, the holders of such Certificates shall be entitled to receive in exchange therefor the amount of cash and a certificate or certificates representing the number of whole shares of Parent Preferred Stock into which their shares of Company Common Stock represented by such Certificates were converted at the Effective Time, rounded up to the next whole number pursuant to Section 2.7(e) and any dividends or distributions payable pursuant to Section 2.7(d), and the Certificates so surrendered shall forthwith be canceled. Until so surrendered, outstanding Certificates will be deemed from and after the Effective Time, for all corporate purposes, to evidence only the right to receive the amount of cash and the whole number of shares of Parent Preferred Stock into which such shares of Company Common Stock shall have been so converted and the right to receive any dividends or distributions payable pursuant to Section 2.7(d). In no event shall the holder of any Certificate be entitled to receive interest on any funds to be received in the Merger. In the event of a transfer of ownership of shares of Company Common Stock which is not registered in the transfer records of Company, the amount of cash and a certificate or certificates representing that whole number of shares of Parent Preferred Stock into which such shares of Company Common Stock were converted at the Effective Time may be issued to a transferee if the Certificate representing such Company Common Stock is presented to the Exchange Agent accompanied by all documents required to evidence and effect such transfer and by evidence that any applicable stock transfer taxes have been paid.

        (d)     Distributions With Respect to Unexchanged Shares.     No dividends or other distributions declared or made after the date of this Agreement with respect to Parent Preferred Stock with a record date after the Effective Time will be paid to the holders of any unsurrendered Certificates with respect to the shares of Parent Preferred Stock represented thereby until the holders of record of such Certificates shall surrender such Certificates. Subject to applicable law, following surrender of any such Certificates, the Exchange Agent shall deliver to the holders of certificates representing whole shares of Parent Preferred Stock issued in exchange therefor, without interest: (i) promptly, the amount of dividends or other distributions with a record date after the Effective Time theretofore paid with respect to such whole shares of Parent Preferred Stock, and (ii) at the appropriate payment date, the amount of dividends or other distributions with a record date after the Effective Time but prior to surrender and a payment date occurring after surrender, payable with respect to such whole shares of Parent Preferred Stock.

        (e)     Fractional Shares.     No certificate or scrip representing fractional shares of Parent Preferred Stock will be issued in the Offer or the Merger upon the surrender for exchange of Certificates. In lieu of any such fractional shares of Parent Preferred Stock, the number of shares of Parent Preferred Stock to be issued shall be rounded up to the next whole number (after taking into account all Certificates delivered by such holder).

        (f)     Required Withholding.     Each of the Exchange Agent, Parent and the Surviving Corporation shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable pursuant to this Agreement to any holder or former holder of Company Common Stock such amounts as may be required to be deducted or withheld therefrom under the Internal Revenue Code of 1986, as amended (the "Code"), or under any provision of state, local or foreign tax law. To the extent such amounts are so deducted or withheld, such amounts shall be treated for all purposes under this Agreement as having been paid to the person to whom such amounts would otherwise have been paid.

        (g)     Lost, Stolen or Destroyed Certificates.     In the event that any Certificates shall have been lost, stolen or destroyed, the Exchange Agent shall issue in exchange for such lost, stolen or destroyed Certificates, upon the making of an affidavit of that fact by the holder thereof, the cash and certificates representing the whole number of shares of Parent Preferred Stock into which the shares of Company Common Stock represented by such Certificates were converted pursuant to Section 2.6 and any dividends or distributions payable pursuant to Section 2.7(d); provided, however, that Parent may, in its discretion and as a condition precedent to the issuance of such certificates representing shares of Parent Preferred Stock and payment of cash and other distributions, require the owner of such lost, stolen or destroyed Certificates to deliver a bond in such sum as it may reasonably direct as indemnity against any claim that may be made against Parent, the Surviving Corporation or the Exchange Agent with respect to the Certificates alleged to have been lost, stolen or destroyed.

        (h)     No Liability.     Notwithstanding anything to the contrary in this Section 2.7, neither the Exchange Agent, Parent, the Surviving Corporation nor any party hereto shall be liable to a holder of shares of Parent Preferred Stock or Company Common Stock for any amount properly paid to a public official pursuant to any applicable abandoned property, escheat or similar law.

        (i)     Termination of Exchange Fund.     Any portion of the Exchange Fund which remains undistributed to the holders of Company Common Stock for one year after the Effective Time shall be delivered to Parent, upon demand, and any holders of Company Common Stock who have not theretofore complied with the provisions of this Section 2.7 shall thereafter look only to Parent for the payment of cash and shares of Parent Preferred Stock into which the shares of Company Common Stock were converted pursuant to Section 2.6 and any dividends or other distributions with respect to Parent Preferred Stock to which they are entitled pursuant to Section 2.7(d), in each case, without any interest thereon. Any securities or cash amounts remaining unclaimed by holders of Certificates five years after the Effective Time (or such earlier date immediately prior to such time as such amounts would otherwise escheat to or become property of any governmental entity) shall, to the extent permitted by applicable law, become the property of Parent free and clear of any claims or interests of any person previously entitled thereto.

        Section 2.8     No Further Ownership Rights in Company Common Stock.    All shares of Parent Preferred Stock issued and all cash paid upon the surrender for exchange of Certificates in accordance with the terms hereof (including any cash paid in respect thereof pursuant to Section 2.7(d)) shall be deemed to have been issued at the Effective Time in full satisfaction of all rights pertaining to such shares of Company Common Stock, and there shall be no further registration of transfers on the records of the Surviving Corporation of shares of Company Common Stock that were outstanding immediately prior to the Effective Time. If after the Effective Time Certificates are presented to the Surviving Corporation for any reason, they shall be canceled and exchanged as provided in this Article II.

        Section 2.9     Stock Options.    (a) Immediately prior to the Effective Time, all outstanding options to purchase Company Common Stock shall be canceled, and, in lieu thereof, on the Closing Date, the holder of each such option, except as set forth on Schedule 3.2(b) of the Disclosure Letter, shall receive a single lump sum cash payment from the Surviving Corporation equal to the product of: (i) the total number of shares of Company Common Stock previously subject to such option; times (ii) the amount by which $10.50 exceeds the exercise price per share of Company Common Stock subject to such option, as reduced by any required withholding of taxes.

        (b)     Prior to the Effective Time, Company shall use its best efforts to: (i) take all steps necessary to cause the Company's stock option plans to be terminated on or prior to the Effective Time, subject to the provisions set forth in this Section 2.9, and to otherwise make any amendments to the terms of such stock option plans that are necessary to give effect to the transactions contemplated by this Agreement; and (ii) obtain at the earliest practicable date written consents from all holders of options to the cancellation of such holder's options, subject to the provisions set forth in this Section 2.9, to take effect at the Effective Time. Notwithstanding any other provision of this Section 2.9(b), payment may be withheld in respect of any options until necessary or appropriate consents are obtained with respect thereto.

        Section 2.10     Taking of Necessary Action; Further Action.    If, at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Surviving Corporation with full right, title and possession to all assets, property, rights, privileges, powers and franchises of Company and Merger Sub, the officers and directors of Company, Merger Sub and the Surviving Corporation will take all such lawful and necessary action in the name of Company or Merger Sub. Parent shall cause Merger Sub to perform all of its obligations relating to this Agreement and the transactions contemplated hereby.

        Section 2.11     Dissenting Shares.    Notwithstanding Section 2.6, if the Merger is effectuated pursuant Section 92A.180 of Nevada Law, Shares outstanding immediately prior to the Effective Time and held by a holder who has demanded appraisal for such Shares in accordance with Nevada Law shall not be converted into a right to receive the Merger Consideration, unless such holder fails to perfect or withdraws or otherwise loses his or her right to appraisal. If after the Effective Time such holder fails to perfect or withdraws or loses his or her right to appraisal, such Shares shall be treated as if they had been converted as of the Effective Time into a right to receive the Merger Consideration. Company shall give Parent prompt notice of any demands received by Company for appraisal of Shares, and Parent shall have the right to participate in all negotiations and proceedings with respect to such demands. Company shall not, except with the prior written consent of Parent, make any payment with respect to, or settle or offer to settle, any such demands. Any amounts paid to a holder pursuant to a right of appraisal will be paid by Company.

ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF COMPANY

        Except as disclosed in the disclosure letter delivered by Company to Parent dated as of the date hereof and certified by a duly authorized officer of Company (the "Disclosure Letter"), Company represents and warrants to Parent and Merger Sub as follows:

        Section 3.1     Organization; Subsidiaries.    (a) Company and each of its subsidiaries (as defined in Section 9.3(d)) is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to conduct its business in the manner in which its business is currently being conducted and to own, lease and operate the properties and assets used in connection therewith. Company and each of its subsidiaries is duly qualified to do business as a foreign corporation, and is in good standing, in each jurisdiction where the character of its properties owned or held under lease or the nature of its activities makes such qualification necessary, except to the extent that any failure to so qualify or be in good standing would not have a Material Adverse Effect (as defined in Section 9.3(b)) on Company or adversely affect the ability of Company to perform its obligations hereunder or to consummate the Merger.

        (b)     Schedule 3.1 of the Disclosure Letter indicates the jurisdiction of organization of each subsidiary of Company and Company's direct or indirect equity interest therein. Pontotoc Holdings, Inc., an Oklahoma Corporation, will become a wholly–owned subsidiary of Company upon completion of the acquisition described in Section 6.16 hereof.

        (c)    Company has delivered or made available to Parent a true, complete and correct copy of the Articles of Incorporation and Bylaws of Company and similar governing instruments of each of its subsidiaries, each as amended to date (collectively, the "Company Charter Documents"), and each such instrument is in full force and effect. Neither Company nor any of its subsidiaries is in violation of any of the provisions of the Company Charter Documents.

        (d)    Neither Company nor any of its subsidiaries identified in Schedule 3.1 of the Disclosure Letter owns, directly or indirectly, any capital stock of, or any equity interest of any nature in, any corporation, partnership, joint venture arrangement or other business entity (other than Company's subsidiaries). Neither Company nor any of its subsidiaries has agreed or is obligated to make, or is bound by any written, oral or other agreement, contract, subcontract, lease, binding understanding, instrument, note, option, warranty, purchase order, license, sublicense, insurance policy, benefit plan or legally binding commitment or undertaking of any nature, as in effect as of the date hereof or as may hereinafter be in effect, under which it may become obligated to make any future material investment in or material capital contribution to any other entity. Neither Company, nor any of its subsidiaries, is a general partner of any general partnership, limited partnership or other similar entity.

        Section 3.2     Company Capitalization.    (a) The authorized capital stock of Company consists solely of 100,000,000 shares of Company Common Stock, of which there were 5,213,695 shares issued and outstanding as of December 31, 2000, and 5,000,000 shares of preferred stock, par value $0.0001 per share, of which no shares are issued or outstanding. All outstanding shares of Company Common Stock are duly authorized, validly issued, fully paid and nonassessable and are not subject to preemptive rights created by statute, the Articles of Incorporation or Bylaws of Company or any agreement or document to which Company is a party or by which it is bound. There are no shares of Company Common Stock held in treasury by Company.

        (b)     As of the close of business on December 31, 2000, 129,050 shares of Company Common Stock are subject to issuance pursuant to outstanding options to purchase Company Common Stock under Company's stock option plan (collectively, the "Company Options"). Schedule 3.2(b) of the Disclosure Letter sets forth the following information with respect to each Company Option outstanding as of the date of this Agreement: (i) the name of the optionee; (ii) the number of shares of Company Common Stock subject to such Company Option; (iii) the exercise price of such Company Option; (iv) the date on which such Company Option was granted or assumed; (v) the date on which such Company Option vested or will vest; (vi) the date on which such Company Option expires; and (vii) whether the exercisability of such option will be accelerated in any way by the transactions contemplated by this Agreement, and indicates the extent of any such acceleration. Company has made available to Parent an accurate and complete copy of Company's stock option plan and the standard forms of stock option agreements evidencing Company Options. There are no options outstanding to purchase shares of Company Common Stock other than pursuant to the Company Options. All shares of Company Common Stock subject to issuance as aforesaid, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, will be duly authorized, validly issued, fully paid and nonassessable.

        (c)    All outstanding shares of Company Common Stock, all outstanding Company Options and all outstanding shares of capital stock of each subsidiary of Company have been issued and granted in compliance with (i) all applicable securities laws and other applicable Legal Requirements (as defined below) and (ii) all requirements set forth in applicable agreements or instruments.

        (d)    For the purposes of this Agreement, "Legal Requirements" means any federal, state, local, municipal, foreign or other law, statute, constitution, principle of common law, resolution, ordinance, code, edict, decree, rule, regulation, ruling or requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any Governmental Entity (as defined in Section 3.4).

        Section 3.3     Obligations With Respect to Capital Stock.    (a) Except as set forth in Section 3.2 or on Schedule 3.3 of the Disclosure Letter, there are no equity securities, partnership interests or similar ownership interests of any class of Company equity security, or any securities exchangeable or convertible into or exercisable for such equity securities, partnership interests or similar ownership interests, issued, reserved for issuance or outstanding.

        (b)    Company owns all of the securities of its subsidiaries identified on Schedule 3.1 of the Disclosure Letter, free and clear of all claims and Encumbrances (as defined below), and there are no other equity securities, partnership interests or similar ownership interests of any class of equity security of any subsidiary of Company, or any security exchangeable or convertible into or exercisable for such equity securities, partnership interests or similar ownership interests, issued, reserved for issuance or outstanding.

        (c)    For purposes of this Agreement, "Encumbrances" means any lien, pledge, hypothecation, charge, mortgage, security interest, encumbrance, claim, infringement, interference, option, right of first refusal, preemptive right, community property interest or restriction of any nature (including any restriction on the voting of any security, any restriction on the transfer of any security or other asset, any restriction on the receipt of any income derived from any asset, any restriction on the use of any asset and any restriction on the possession, exercise or transfer of any other attribute of ownership of any asset).

        (d)    Except as set forth in Section 3.2, there are no subscriptions, options, warrants, equity securities, partnership interests or similar ownership interests, calls, rights (including preemptive rights), commitments or agreements of any character to which Company or any of its subsidiaries is a party or by which it is bound obligating Company or any of its subsidiaries to issue, deliver or sell, or cause to be issued, delivered or sold, or repurchase, redeem or otherwise acquire, or cause the repurchase, redemption or acquisition of, any shares of capital stock, partnership interests or similar ownership interests of Company or any of its subsidiaries or obligating Company or any of its subsidiaries to grant, extend, accelerate the vesting of or enter into any such subscription, option, warrant, equity security, call, right, commitment or agreement. There are no registration rights with respect to any equity security of any class of Company or with respect to any equity security, partnership interest or similar ownership interest of any class of any of its subsidiaries. There are no shareholder, voting trust, or other agreements or understandings to which Company or any of its subsidiaries is a party or to which any of them are bound relating to the voting of any shares of the capital stock of Company or any of its subsidiaries.

        Section 3.4     Authority; Non–Contravention.    (a) Company has all requisite corporate power and authority to enter into this Agreement and, subject to the Company Stockholder Approvals (as defined below), to consummate the transactions contemplated hereby. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Company, subject only to the approval and adoption of this Agreement and the approval of the Merger by Company's stockholders (the "Company Stockholder Approvals") and the filing of the Articles of Merger pursuant to Nevada Law. The affirmative vote of the holders of a majority of the outstanding shares of Company Common Stock is sufficient for Company's stockholders to approve and adopt this Agreement and approve the Merger, and no other approval of any holder of any securities of Company is required in connection with the consummation of the transactions contemplated hereby. This Agreement has been duly executed and delivered by Company and, assuming the due execution and delivery by Parent and Merger Sub, constitutes the valid and binding obligation of Company, enforceable against Company in accordance with its terms, except as enforceability may be limited by bankruptcy and other similar laws affecting the rights of creditors generally and general principles of equity.

        (b)     The execution and delivery of this Agreement by Company do not, and the performance of this Agreement by Company will not: (i) conflict with or violate the Company Charter Documents, (ii) subject to obtaining Company Stockholder Approvals and compliance with the requirements set forth in Section 3.4(c), conflict with or violate any law, rule, regulation, order, judgment or decree applicable to Company or any of its subsidiaries or by which Company or any of its subsidiaries or any of their respective properties is bound or affected, or (iii) result in any breach of or constitute a default (or an event that, with notice or lapse of time or both, would become a default) under, or impair Company's rights or alter the rights or obligations of any third party under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of an Encumbrance on any of the properties or assets of Company or any of its subsidiaries pursuant to, any note, bond, mortgage, indenture, agreement, lease, license, permit, franchise, concession or other instrument or obligation to which Company or any of its subsidiaries is a party or by which Company or any of its subsidiaries or its or any of their respective assets are bound or affected, except, in the case of clauses (ii) and (iii), for such conflicts, violations, breaches, defaults, impairments or rights which, individually or in the aggregate, would not have a Material Adverse Effect on Company. Schedule 3.4(b) of the Disclosure Letter lists all consents, waivers and approvals under any of Company's or any of its subsidiaries' agreements, contracts, licenses or leases required to be obtained in connection with the consummation of the transactions contemplated hereby, which, if individually or in the aggregate not obtained, would result in a material loss of benefits to Company or the Surviving Corporation as a result of the Merger.

        (c)     No action by or in respect of, or filing with, any court, tribunal, arbitrator, administrative agency or commission or other governmental authority or instrumentality, foreign, domestic or supranational ("Governmental Entity") or other person is required to be obtained or made by Company in connection with the execution and delivery of this Agreement or the consummation by Company of the transactions contemplated hereby, except for (i) the filing of the Articles of Merger with the Secretary of State of the State of Nevada and appropriate documents with the relevant authorities of other states in which Company is qualified to do business, (ii) compliance with any applicable requirements of the Securities Act of 1933, as amended (the "Securities Act"), the Exchange Act, and any other applicable securities law, whether state or foreign, and (iii) such other consents, authorizations, filings, approvals and registrations which if not obtained or made would not have a Material Adverse Effect on Company or the Surviving Corporation or adversely affect the ability of Company to perform its obligations hereunder or to consummate the Merger.

        Section 3.5     SEC Filings; Company Financial Statements.    (a) Company has timely filed all forms, reports, schedules, statements and documents required to be filed by Company with the SEC since December 31, 1998, and has made available to Parent such forms, reports, schedules, statements and documents in the form filed with the SEC. All such required forms, reports, schedules, statements and documents are referred to herein as the "Company SEC Reports." As of their respective dates, the Company SEC Reports (i) were prepared in accordance with the requirements of the Securities Act or the Exchange Act, as the case may be, and the rules and regulations of the SEC thereunder applicable to such Company SEC Reports and (ii) did not at the time they were filed (or, if amended or superseded by a filing prior to the date of this Agreement, then on the date of such filing) contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. None of Company's subsidiaries is required to file any forms, reports or other documents with the SEC.

        (b)     Each of the consolidated financial statements of Company (including, in each case, any related notes thereto) contained in the Company SEC Reports (the "Company Financials"): (i) complies as to form in all material respects with the published rules and regulations of the SEC with respect thereto, (ii) was prepared in accordance with GAAP applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto or, in the case of unaudited interim financial statements, as may be permitted by the SEC under Form 10–Q, 8–K or any successor form under the Exchange Act) and (iii) fairly presents the consolidated financial position of Company and its subsidiaries as at the respective dates thereof and the consolidated results of Company's operations and cash flows for the periods indicated, except that the unaudited interim financial statements may not contain footnotes and were or are subject to normal and recurring year–end adjustments. The balance sheet of Company contained in the Company SEC Reports as of September 30, 2000, is hereinafter referred to as the "Company Balance Sheet."

        (c)     Company has heretofore furnished to Parent a complete and correct copy of any amendments or modifications, which have not yet been filed with the SEC but which are required to be filed by Company with the SEC pursuant to the Securities Act or the Exchange Act.

        (d)     Each of the consolidated, unaudited balance sheet and statement of income of Pontotoc Holdings, Inc. ("Holdings"), as of September 30, 2000, and for the period then ended (including, in each case, any related notes thereto), previously provided to Parent, has been prepared from the books and records of Holdings and its subsidiary, is complete, correct and in accordance with the books of account and records of Holdings and its subsidiary and fairly presents the consolidated financial position of Holdings and its subsidiary as at the date thereof and the consolidated results of Holdings' and its subsidiary's operations for the period indicated. Neither Holdings nor its subsidiary has since the date of the financial statements described in the immediately preceding sentence incurred any liability or obligation (whether accrued, absolute, contingent, unliquidated or otherwise), except (i) liabilities reflected in such financial statements, (ii) current liabilities which have arisen since the date of the financial statements in the ordinary course of business (none of which is a material liability for breach of contract, tort or infringement) and (iii) liabilities arising under executory contracts entered into in the ordinary course of business (none of which is a material liability for breach of contract).

        Section 3.6     Undisclosed Liabilities.    Neither Company nor any of its subsidiaries has any liability (whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due, including any liability for Taxes), except for liabilities set forth on the face of the Company Balance Sheet (or in one or more notes thereto) and liabilities which arose in the ordinary course of business since the date of the Company Balance Sheet. Except as set forth in Schedule 3.6 of the Disclosure Letter, Company does not have any liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due, including any liability for Taxes), based on any of its subsidiaries' operations, ownership of assets, actions or inactions.

        Section 3.7     Absence of Certain Changes or Events.    (a) Since the date of the Company Balance Sheet, the business of Company and its subsidiaries has been conducted in the ordinary course consistent with past practices (other than the transactions contemplated by this Agreement) and there has not been (i) any event, occurrence, development or state of circumstances or facts that has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of Company's or any of its subsidiaries' capital stock, or any purchase, redemption or other acquisition by Company of any of Company's capital stock or any other securities of Company or its subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities, except for repurchases which are not, individually or in the aggregate, material in amount from employees following their termination pursuant to the terms of their pre–existing stock option or purchase agreements, (iii) any material change by Company in its accounting methods, principles or practices, except as required by changes in GAAP, or (iv) any revaluation by Company of any of its material assets, other than in the ordinary course of business.

        (b)     Since the date of the Company Balance Sheet and through the date of this Agreement, neither Company nor any of its subsidiaries has taken any action that, if taken after the date hereof, would constitute a breach of any provision of Section 5.1 hereof.

        Section 3.8     Taxes.    Except as set forth in Schedule 3.8 of the Disclosure Schedule: (a) Company and each of its subsidiaries have timely filed all material federal, state, local and foreign returns, estimates, information statements and reports relating to Taxes (as defined below) required to be filed by or on behalf of Company and each of its subsidiaries with any Tax authority ("Returns"). The Returns are true, correct and complete in all material respects. In particular, and without limiting the foregoing, none of the Returns contains any position which is or would be subject to penalties under Section 6662 of the Code or any corresponding provision of state, local or foreign Tax law. Company and each of its subsidiaries have paid all Taxes due for the periods covered by such Returns, whether or not such Taxes are shown to be due on such Returns.

        (b)     Company and each of its subsidiaries have withheld with respect to its employees all federal and state income Taxes, Taxes pursuant to the Federal Insurance Contribution Act ("FICA"), Taxes pursuant to the Federal Unemployment Tax Act ("FUTA") and all other Taxes required to be withheld.

        (c)     Neither Company nor any of its subsidiaries has been delinquent in the payment of any material Tax, nor is there any material Tax deficiency outstanding, proposed or assessed against Company or any of its subsidiaries. Company and its subsidiaries have not executed any unexpired waiver of any statute of limitations on or extending the period for the assessment or collection of any Tax.

        (d)     No audit or other examination of any Return of Company or any of its subsidiaries by any Tax authority is presently in progress, nor has Company or any of its subsidiaries been notified of any request for such an audit or other examination that is reasonably likely to result in any adjustment that is material to Company and its subsidiaries, taken as a whole.

        (e)     No adjustment relating to any Returns filed by Company or any of its subsidiaries has been proposed in writing formally or informally by any Tax authority to Company or any of its subsidiaries or any representative thereof that is reasonably likely to be material to Company and its subsidiaries, taken as a whole.

        (f)     Neither Company nor any of its subsidiaries has any material liability for unpaid Taxes, whether asserted or unasserted, contingent or otherwise, which have not been accrued for or reserved on the Company Balance Sheet in accordance with GAAP (excluding any reserve for deferred Taxes established to reflect timing differences between book and Tax income), other than any liability for unpaid Taxes that may have accrued since the date of the Company Balance Sheet in connection with the operation of the business of Company and its subsidiaries in the ordinary course of operations.

        (g)     There is no agreement, plan or arrangement to which Company or any of its subsidiaries is a party, including this Agreement and the agreements entered into in connection with this Agreement, covering any employee or former employee of Company or any of its subsidiaries that, individually or collectively, would be reasonably likely to give rise to the payment of any amount that would not be deductible pursuant to Sections 280G, 404 or 162(m) of the Code.

        (h)     Neither Company nor any of its subsidiaries has filed any consent agreement under Section 341(f) of the Code or agreed to have Section 341(f)(2) of the Code apply to any disposition of a subsection (f) asset (as defined in Section 341(f)(4) of the Code) owned by Company.

        (i)     Neither Company nor any of its subsidiaries is party to or has any obligation under any Tax–sharing, Tax indemnity or Tax allocation agreement or arrangement.

        (j)     Company and its subsidiaries have not been and will not be required to include any adjustment in taxable income for any Tax period (or portion thereof) pursuant to Section 481 of the Code or any comparable provision under state or foreign Tax laws as a result of transactions, events or accounting methods employed prior to the Closing.

        (k)    Company has not been distributed in a transaction qualifying under Section 355 of the Code within the last two years, nor has Company distributed the stock in any corporation in a transaction qualifying under Section 355 of the Code within the last two years.

        (l)    There are no liens for Taxes (other than for Taxes not yet due and payable) upon the assets of Company or any of its subsidiaries.

        (m)    Except for the group of which Company and its subsidiaries are currently a member, neither Company nor any of its subsidiaries has ever been a member of an affiliated group of corporations within the meaning of Code section 1504.

        (n)    None of the assets of Company or any of its subsidiaries is property which Company or any of its subsidiaries is required to treat as being owned by any other person pursuant to the "safe–harbor lease" provisions of former section 168(f)(8) of the Code.

        (o)    None of the assets of Company or any of its subsidiaries directly or indirectly secures any debt the interest on which is tax exempt under section 103(a) of the Code.

        (p) None of the assets of Company or any of its subsidiaries is "tax–exempt use property" within the meaning of section 168(h) of the Code.

        (q)    Company and its subsidiaries do not have and have not ever had a permanent establishment in any foreign country, as defined in any applicable Tax treaty or convention between the United States of America and such foreign country.

        (r)    Neither Company nor any of its subsidiaries is a party to any joint venture, partnership, or other arrangement or contract which could be treated as a partnership for federal income tax purposes, except for joint ventures and joint operating agreements in the ordinary course of oil and gas operations.

        (s)    Each asset with respect to which Company or any of its subsidiaries claims depreciation, amortization or similar expense for Tax purposes is owned for Tax purposes by Company.

        (t)    No item of income or gain reported by Company or any of its subsidiaries for financial accounting purposes in any pre–closing period is required to be included in taxable income for a post–closing period.

        (u)    Neither Company nor any of its subsidiaries has made or is bound by any election under section 197 of the Code.

        (v)    There are no outstanding rulings of, or requests for rulings with, any Tax authority addressed to Company or any of its subsidiaries that are, or if issued would be, binding on Company or its subsidiaries.

        (w)    For the purposes of this Agreement, "Tax" or "Taxes" refers to (i) any and all federal, state, local and foreign taxes, assessments and other governmental charges, duties, impositions and liabilities relating to taxes, including taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, and value added, ad valorem, transfer, franchise, withholding, payroll, recapture, employment, excise and property taxes, together with all interest, penalties and additions imposed with respect to such amounts, (ii) any liability for payment of any amounts of the type described in clause (i) as a result of being a member of an affiliated consolidated, combined or unitary group, and (iii) any liability for amounts of the type described in clause (i) or (ii) as a result of any express or implied obligation to indemnify another person or as a result of any obligations under any agreements or arrangements with any other person with respect to such amounts and including any liability for taxes of a predecessor entity.

        Section 3.9    Title to Assets.    Company and its subsidiaries have good and marketable title to, or a valid leasehold interest in, the properties and assets, other than the Oil and Gas Interests (as defined in Section 3.11(c)) of the Company and its subsidiaries, used by them, located on their premises, or shown on the Company Balance Sheet or acquired after the date thereof, free and clear of all Encumbrances, except for properties and assets disposed of in the ordinary course of business since the date of the Company Balance Sheet.

        Section 3.10     Real Property Other Than Oil and Gas Interests.    (a) Each of Company and its subsidiaries does not own, has never owned, does not have, nor has it ever had any interest in any real property, other than Oil and Gas Interests, other than pursuant to a valid lease.

        (b)    Schedule 3.10 of the Disclosure Letter lists and describes briefly all real property leased or subleased to each of Company and its subsidiaries, other than Oil and Gas Interests. Company has delivered to Parent correct and complete copies of the leases and subleases listed in Schedule 3.10 of the Disclosure Letter. With respect to each material lease and sublease listed in Schedule 3.10 of the Disclosure Letter, all such leases and subleases are in full force and effect, are valid and effective in accordance with their respective terms, and there is not, under any of such leases or subleases, any existing default or event of default (or event which with notice or lapse of time, or both, would constitute a default) that would give rise to a material claim against Company.

        Section 3.11     Title to Oil and Gas Interests.    (a) Except as set forth in Schedule 3.11 of the Disclosure Letter, Company and its subsidiaries have Good Title (as defined below) to all Oil and Gas Interests of Company or its subsidiaries.

        (b)     For purposes of this Agreement, "Good Title" shall mean good and defensible title which is (i) evidenced by an instrument or instruments filed of record in accordance with the conveyance and recording laws of the applicable jurisdiction and is sufficient against competing claims of bona fide purchasers for value without notice and (ii) free and clear of all Encumbrances, other than such Encumbrances that a reasonably prudent purchaser of oil and gas properties and a prudent lender that is lending against such Oil and Gas Interests as collateral would accept in light of the value of the property affected, the improbability of assertion of the defect or irregularity or the cost of performing curative work.

        (c)    For purposes of this Agreement, "Oil and Gas Interests" shall mean any and all (i) direct and indirect interests in and rights in respect of oil, gas and other minerals and hydrocarbons and related properties and assets of any kind and nature, direct or indirect, including working interests, royalties, overriding royalties, production payments, operating rights, net profits interests, other non–working interests and non–operating interests, contract rights, debt instruments, and equity interests in joint ventures, partnerships, corporations and other entities, including common and preferred stock, debentures, bonds and other securities of every kind and nature and unrelated assets coincidentally acquired in connection with the acquisition of the foregoing assets; (ii) interests in and rights in respect of oil, gas and other minerals and hydrocarbons or revenues therefrom and all contracts in connection therewith and claims and rights thereto (including all oil and gas leases, operating agreements, unitization and pooling agreements and orders, division orders, transfer orders, mineral deeds, royalty deeds, oil and gas sales, exchange and processing contracts and agreements and interests related to any of the foregoing), surface interests, fee interests, reversionary interests, royalties, overriding royalties, reservations, and concessions; (iii) easements, licenses, rights of way, servitudes, permits, leases, and other interests associated with, appurtenant to, or necessary for the operation of any of the foregoing; and (iv) interests in fixtures, equipment and machinery (including well equipment and machinery and workover, completion and drilling rigs), oil and gas production, gathering, compression, treating, processing, transmission or storage facilities (including tanks, tank batteries, pipelines and gathering systems), pumps, water plants, electric plants, gasoline and gas processing plants, refineries, and other tangible personal property and fixtures associated with, appurtenant to or necessary for the operation of any of the foregoing.

        Section 3.12     Oil and Gas Interests of Company and its Subsidiaries.    Except as set forth in Schedule 3.12 of the Disclosure Letter: (i) there are no preferential purchase rights, first refusal rights or other similar contractual rights granted to any third parties applicable to any of Company's Oil and Gas Interests; (ii) neither Company nor any of its subsidiaries has been advised by any operator, lessor or any other party of any default under any such Oil and Gas Interests which default has not heretofore been cured in all respects; (iii) all proper and timely payments (including royalties, delay rentals and shut–in royalties) due under Company's Oil and Gas Interests have been timely made and paid by the operator(s) of each such lease or well; and (iv) Company and its subsidiaries are entitled to be paid, and are being paid, in all material respects, their percentage of net revenue interests included in Company's Oil and Gas Interests without suspense.

        Section 3.13     Refund.    Except as included or reflected on the Company Balance Sheet or as set forth in Schedule 3.13 of the Disclosure Letter: (i) neither Company nor any of its subsidiaries is obligated by virtue of a prepayment arrangement under any gas contract containing a "take or pay" or similar provision, a production payment or any other arrangement to deliver any material amount of gas or oil attributable to Company's Oil and Gas Interests at some future time without then or thereafter receiving full payment therefor; and (ii) neither Company nor any of its subsidiaries has received any funds or payments from purchasers of production of gas under gas contracts which are subject to a potential material refund.

        Section 3.14     Payout Balances.    Schedule 3.14 of the Disclosure Letter contains a reasonably complete and accurate list of the status, as of December 31, 2000, with respect to Company operated wells, and as of December 31, 2000, with respect to third party operated wells, of: (a) the "payout" balance for each Company Oil and Gas Interest that is subject to a reversion or other adjustment at some level of cost recovery or payout (or passage of time or other event, other than cessation of production); and (b) all gas balancing obligations and rights for each Company Oil and Gas Interest which is subject to a gas balancing overage or underage. As used in this Section 3.14 and in Section 3.15, the term "Company operated wells" shall also include all wells operated by any of Company's subsidiaries.

        Section 3.15     Operations.    Except as set forth in Schedule 3.15 of the Disclosure Letter:

        (a)    All of the Company operated wells included in the Oil and Gas Interests of Company and its subsidiaries and which are described in Schedule 3.15 of the Disclosure Letter have been drilled within the boundaries of such Oil and Gas Interests or within the limits otherwise permitted by contract, pooling or unit agreement, lease instrument, and by law and in accordance with generally prevailing standards of the oil and gas industry.

        (b)    All drilling and completion of the Company operated wells in such Oil and Gas Interests and all development and operations on such Oil and Gas Interests have been conducted in compliance in all material respects with all applicable laws, ordinances, rules, regulations and permits, and judgments, orders, and decrees of any court or governmental body or agency.

        (c)    With respect to Company operated wells, all equipment constituting part of the Oil and Gas Interests of Company and its subsidiaries has been installed, maintained, and operated by Company or its subsidiaries as a prudent operator in accordance with generally prevailing standards of the oil and gas industry, and is currently in a state of repair so as to be adequate for normal operations by Company or its subsidiaries, except where the failure to do so would not, individually or in the aggregate, have a Material Adverse Effect on Company.

        (d)    No Company operated well included in such Oil and Gas Interests is subject to penalties on allowables because of any overproduction (legal or illegal) which would prevent the full legal and regular allowable (including maximum permissible tolerance) as prescribed by any court or federal, state or local governmental body or agency to be assigned to any such well.

        Section 3.16     Plugging Status.    All wells operated by Company or any of its subsidiaries that have been permanently plugged and abandoned have been so plugged and abandoned in accordance in all material respects with all applicable laws, ordinances, rules, regulations and permits, and judgments, orders, and decrees of any court or governmental body or agency.

        Section 3.17    Financial and Commodity Hedging.    Schedule 3.17 of the Disclosure Letter accurately summarizes the outstanding hydrocarbon and financial hedging positions of Company and its subsidiaries (including fixed price controls, collars, swaps, caps, hedges and puts) as of the date reflected on the Disclosure Letter.

        Section 3.18     Governmental Regulation.    Neither Company nor any of its subsidiaries is subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act, the Investment Company Act of 1940 or any state public utilities laws.

        Section 3.19     Intellectual Property.    (a) Except as set forth in Schedule 3.19 of the Disclosure Letter, neither Company nor any of its subsidiaries has any registered copyrights, patents, trademarks, service marks or applications for any of the foregoing. Except as set forth in Schedule 3.19 of the Disclosure Letter, Company and each of its subsidiaries licenses to use or otherwise possesses legally enforceable rights to use, all proprietary technologies, know–how, and all other inventions, discoveries, improvements, processes and formulas (secret or otherwise) and any related documentation thereto used or possessed by or related to Company or to any subsidiary as is necessary for the current conduct of the business of Company or of any subsidiary.

        (b)     Company and its subsidiaries are not, nor will any of them be as a result of the execution and delivery of this Agreement or the performance of the transactions contemplated hereby, in violation of any licenses, sublicenses or other contracts to which it or any of its subsidiaries is a party and pursuant to which it or any subsidiary is authorized to use any patent, copyright, trademark, trade name, service mark or any other form of intellectual property or trade secret owned by a third party.

        (c)     All copyrights, patents, trademarks, service marks and trade names held by Company and its subsidiaries are valid and subsisting, except for any failures so to be valid and subsisting that, individually or in the aggregate, would not have a Material Adverse Effect on Company or the Surviving Corporation.

        Section 3.20     Compliance with Laws.    (a) Neither Company nor any of its subsidiaries is in conflict with, or has violated or is in violation of any Legal Requirement applicable to Company or any of its subsidiaries or by which Company or any of its subsidiaries or any of their respective properties is bound or affected, except for conflicts or violations that, individually or in the aggregate, would not have a Material Adverse Effect on Company or adversely affect the ability of Company to perform its obligations hereunder or to consummate the Merger. No investigation or review by any Governmental Entity is pending or, to Company's knowledge, has been threatened against Company or any of its subsidiaries, nor, to Company's knowledge, has any Governmental Entity indicated an intention to conduct an investigation of Company or any of its subsidiaries. There is no judgment, injunction, order or decree binding upon Company or any of its subsidiaries which has or could reasonably be expected to have the effect of prohibiting or impairing any business practice of Company or any of its subsidiaries, or any acquisition of property by Company or any of its subsidiaries.

        (b)     Company and its subsidiaries hold all permits, licenses, franchises, variances, authorizations, consents, certificates, exemptions, orders and approvals from governmental authorities that are material to or required to own, lease and operate its properties and for the operation of the business of Company as currently conducted (collectively, the "Permits"), and are in compliance with the terms of the Permits. Each of the Permits is in full force and effect and there is no action, investigation or proceeding pending or, to the knowledge of Company, threatened regarding any Permit. Notwithstanding the foregoing, Permits required under Environmental Laws (as defined below) are addressed solely in Section 3.24.

        Section 3.21     Litigation.    There are no claims, suits, actions, investigations or proceedings pending or, to the knowledge of Company, threatened against, relating to or affecting Company, any of its subsidiaries, any officer, director or employee of Company or any of its subsidiaries, or any person for whom Company or any of its subsidiaries may be liable or any of their respective properties, before any Governmental Entity or any arbitrator that seeks to restrain or enjoin the consummation of the transactions contemplated by this Agreement or which would reasonably be expected, either singly or in the aggregate with all such claims, actions or proceedings, to have a Material Adverse Effect or adversely affect the ability of Company to perform its obligations hereunder or to consummate the Merger. As of the date hereof, no director or executive officer of Company has asserted a claim to seek indemnification from Company under Company Charter Documents or any indemnification agreement between Company and such person.

        Section 3.22     Employee Benefit Plans.    (a) Definitions. For purposes of this Agreement, the following terms shall have the meanings set forth below:

        (i)     "COBRA" shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended;

        (ii)     "Company Employee Plan" shall mean any plan, program, policy, practice, contract, agreement or other arrangement providing for compensation, severance, termination pay, performance awards, stock or stock–related awards, fringe benefits or other employee benefits or remuneration of any kind, whether written or unwritten or otherwise, funded or unfunded, including each "employee benefit plan," within the meaning of Section 3(3) of ERISA which is or has been maintained, contributed to, or required to be contributed to, by Company or any Affiliate for the benefit of any Employee;

        (iii)    "DOL" shall mean the Department of Labor;

        (iv)    "Employee" shall mean any current, former, or retired employee, officer, or director of Company or any subsidiary of Company;

        (v)     "Employee Agreement" shall mean each management, employment, severance, consulting, relocation, repatriation, expatriation, visa, work permit or similar agreement or contract between Company or any subsidiary of Company, on the one hand, and any Employee or consultant of Company or any subsidiary of Company, on the other hand;

        (vi)    "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended;

        (vii)   "ERISA Affiliate" shall mean any other person or entity under common control with Company within the meaning of Section 414(b), (c), (m) or (o) of the Code and the regulations issued thereunder;

        (viii)   "FMLA" shall mean the Family Medical Leave Act of 1993, as amended;

        (ix)    "IRS" shall mean the Internal Revenue Service;

        (x)     "Multiemployer Plan" shall mean any "Pension Plan" (as defined below) which is a "multiemployer plan," as defined in Section 3(37) of ERISA;

        (xi)    "PBGC" shall mean the Pension Benefit Guaranty Corporation; and

        (xii)     "Pension Plan" shall mean each Company Employee Plan which is an "employee pension benefit plan," within the meaning of Section 3(2) of ERISA.

        (b)    Schedule.    Schedule 3.22 of the Disclosure Letter contains an accurate and complete list of each Company Employee Plan and each Employee Agreement and, to the knowledge of Company, any other material benefit plan, program, or arrangement in which an Employee is eligible to participate (each plan other than a Company Employee Plan, an "Outsourced Plan"). Company does not have any plan or commitment to establish any new Company Employee Plan, to modify any Company Employee Plan or Employee Agreement (except to the extent required by law or to conform any such Company Employee Plan or Employee Agreement to the requirements of any applicable law), or to enter into any Company Employee Plan or Employee Agreement, nor does it have any intention or commitment to do any of the foregoing.

         (c)     Documents.     Company has made available to Parent: (i) correct and complete copies of all documents embodying each Company Employee Plan and each Employee Agreement, including all amendments thereto and written interpretations thereof; (ii) the most recent annual actuarial valuations, if any, prepared for each Company Employee Plan; (iii) the most recent annual report (Form Series 5500 and all schedules and financial statements attached thereto), if any, required under ERISA or the Code in connection with each Company Employee Plan or related trust; (iv) if Company Employee Plan is funded, the most recent annual and periodic accounting of Company Employee Plan assets; (v) the most recent summary plan description together with the summary of material modifications thereto, if any, required under ERISA with respect to each Company Employee Plan; (vi) the most recent IRS determination or opinion letter, and all rulings relating to Company Employee Plans; (vii) all material written agreements and contracts relating to each Company Employee Plan, including administrative service agreements, group annuity contracts and group insurance contracts; (viii) all communications material to any Employee or Employees relating to any Company Employee Plan and any proposed Company Employee Plans, in each case, relating to any amendments, terminations, establishments, increases or decreases in benefits, acceleration of payments or vesting schedules or other events which would result in any material liability to Company; and (ix) all registration statements and prospectuses prepared in connection with each Company Employee Plan. Additionally, Company has provided information with respect to the Outsourced Plans to the extent reasonably practicable.

         (d)     Employee Plan Compliance.     Except in each case, as would not, individually or in the aggregate, result in a material liability to Company and its subsidiaries, taken as a whole, or as set forth on Schedule 3.22 of the Disclosure Letter: (i) Company has performed in all material respects all obligations required to be performed by it under, is not in default or violation of, and has no knowledge of any default or violation by any other party to, each Company Employee Plan, and each Company Employee Plan has been established and maintained in all material respects in accordance with its terms and in compliance with all applicable laws, statutes, orders, rules and regulations, including ERISA or the Code; (ii) each Company Employee Plan intended to qualify under Section 401(a) of the Code has received an opinion, determination, advisory or notification letter from the IRS that it is so qualified or has remaining a period of time to obtain such a letter from the IRS, and no event has occurred since the date of such determination that could reasonably be expected to result in the revocation of, or materially adversely affect, such qualification; (iii) no "prohibited transaction," within the meaning of Section 4975 of the Code or Sections 406 and 407 of ERISA, and not otherwise exempt under Section 408 of ERISA (or any administrative class exemption issued thereunder), has occurred with respect to any Company Employee Plan; (iv) there are no actions, suits or claims pending, or, to the knowledge of Company, threatened or reasonably anticipated (other than routine claims for benefits) against any Company Employee Plan or against the assets of any Company Employee Plan; (v) each Company Employee Plan (other than currently outstanding stock options) can be amended, terminated or otherwise discontinued after the Effective Time in accordance with its terms, without liability to Parent, Company or any of its Affiliates (other than expenses typically incurred in a termination event); (vi) there are no audits, inquiries or proceedings pending or, to the knowledge of Company, threatened by the IRS or DOL with respect to any Company Employee Plan; (vii) neither Company nor any Affiliate is subject to any penalty or tax with respect to any Company Employee Plan under Section 402(i) of ERISA or Sections 4975 through 4980 of the Code; and (viii) all contributions due from Company or any Affiliate with respect to any of Company Employee Plans have been made as required under ERISA or have been accrued on the Company Balance Sheet.

         (e)     Pension Plans.     Neither Company nor any ERISA Affiliate of Company has now, nor has it ever, maintained, established, sponsored, participated in, or contributed to, any Pension Plan which is subject to Title IV of ERISA or Section 412 of the Code, that would result in material liability to Company and its subsidiaries, taken as a whole.

         (f)     Multiemployer Plans.     At no time has Company or any ERISA Affiliate of Company contributed to or been requested to contribute to any Multiemployer Plan, that would result in material liability to Company and its subsidiaries, taken as a whole.

         (g)     No Post–Employment Obligations.     No Company Employee Plan provides, or has any liability to provide, retiree health benefits to any person for any reason, except as may be required by COBRA or other applicable statute, and Company has never represented, promised or contracted (whether in oral or written form) to any Employee (either individually or to Employees as a group) or any other person that such Employee(s) or other person would be provided with retiree health benefits, except to the extent required by statute.

         (h)     Effect of Transaction.     The execution of this Agreement and the consummation of the transactions contemplated hereby will not (either alone or upon the occurrence of any additional or subsequent events) constitute an event under any Company Employee Plan, Employee Agreement, trust or loan that will or may result in any payment (whether of severance pay or otherwise), acceleration, forgiveness of indebtedness, vesting (other than full vesting as a result of partial or full plan termination of a qualified plan), distribution, increase in benefits or obligation to fund benefits with respect to any Employee. There is no contract, plan or arrangement (written or otherwise) covering any Employee or former Employee of Company that, individually or collectively, could give rise to the payment of any amount that would not be deductible pursuant to the terms of Section 280G or 162(m) of the Code.

         (i)     Employment Matters.     Company and each of its subsidiaries is in compliance in all material respects with all applicable foreign, federal, state and local laws, rules and regulations respecting employment, employment practices, terms and conditions of employment and wages and hours, in each case, with respect to Employees. There are no pending, or, to Company's knowledge, threatened claims or actions against Company under any worker's compensation policy or long–term disability policy. No Employee of Company has violated any employment contract, nondisclosure agreement or noncompetition agreement by which such Employee is bound due to such Employee being employed by Company and disclosing to Company or using trade secrets or proprietary information of any other person or entity.

         (j)     Labor.     Company does not know of any activities or proceedings of any labor union to organize any Employees that would be material to Company. There are no actions, suits, claims, labor disputes or grievances pending, or, to the knowledge of Company, threatened relating to any labor, safety or discrimination matters involving any Employee, including charges of unfair labor practices or discrimination complaints. Neither Company nor any of its subsidiaries has engaged in any unfair labor practices within the meaning of the National Labor Relations Act which would reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect on Company. Company is not presently, nor has it been in the past, a party to, or bound by, any collective bargaining agreement or union contract with respect to Employees and no collective bargaining agreement is being negotiated by Company.

         Section 3.23     Certain Agreements.    Except as disclosed in Schedule 3.23 of the Disclosure Letter, as of the date hereof, neither Company nor any of its subsidiaries is a party to or is bound by:

         (a)     any employment or consulting agreement or commitment with any employee or member of Company's Board of Directors, that, individually or in the aggregate, is material to Company and its subsidiaries, taken as a whole, other than those that are terminable by Company or any of its subsidiaries on no more than 30 days notice without liability or financial obligation, except to the extent general principles of law may limit Company's or any of its subsidiaries' ability to terminate employees at will;

         (b)     any agreement or plan, including any stock option plan, stock appreciation right plan or stock purchase plan, any of the benefits of which will be increased, or the vesting of benefits of which will be accelerated, by the occurrence of any of the transactions contemplated by this Agreement or the value of any of the benefits of which will be calculated on the basis of any of the transactions contemplated by this Agreement;

         (c)     any material guaranty or any instrument evidencing indebtedness for borrowed money by way of direct loan or sale of debt securities;

         (d)     any material agreement, obligation or commitment containing covenants purporting to limit or which effectively limit Company's or any of its subsidiaries' freedom to compete in any line of business or in any geographic area or which would so limit Company or the Surviving Corporation or any of its subsidiaries after the Effective Time;

         (e)     any agreement or commitment currently in force relating to the disposition or acquisition by Company or any of its subsidiaries after the date of this Agreement of a material amount of assets not in the ordinary course of business, or pursuant to which Company has any material ownership or participation interest in any corporation, partnership, joint venture, strategic alliance or other business enterprise other than Company's subsidiaries;

         (f)     any agreement or commitment currently in force providing for capital expenditures by Company or its subsidiaries in excess of $50,000;

         (g)    any agreement, contract or understanding (including any agreement, contract or understanding evidencing any outstanding indebtedness or other similar obligations to Company or its subsidiaries) with any director, officer, affiliate or "associate" (as such term is defined in Rule 12b–2 under the Exchange Act) of Company or its subsidiaries;

        (h)    any Employee Agreement; or

        (i)     any agreement under which the consequences of a default or termination could have a Material Adverse Effect on Company.

        The agreements required to be disclosed in the Disclosure Letter pursuant to clauses (a) through (i) above or that are required to be filed with any Company SEC Report ("Company Contracts"): (i) are legal, valid, binding, enforceable, and in full force and effect in all material respects; and (ii) will continue to be legal, valid, binding, enforceable, and in full force and effect on identical terms following the consummation of the transactions contemplated hereby. With respect to each Company Contract, no party is in breach or default, and no event has occurred which, with notice or lapse of time, would constitute a breach or default, or permit termination, modification, or acceleration under the agreement and, to the knowledge of Company, no party has repudiated any provision of the agreement.

         Section 3.24     Environmental Matters.    (a) Except as disclosed in Schedule 3.24 of the Disclosure Letter:

                    (i)        to Company's knowledge, there are no claims, investigations or inquiries pending or threatened against Company or any of its subsidiaries (or naming Company or any of its subsidiaries as a potentially responsible party) based on noncompliance with any Environmental Law (as defined below) at any of the properties or facilities currently or formerly owned, leased or operated by the Company or any of its subsidiaries;

                     (ii)    all activities of Company and its subsidiaries in the conduct of the business of Company have been conducted in compliance in all material respects with all applicable Environmental Laws;

                     (iii)    neither Company nor any of its subsidiaries nor any other person has, with respect to Company's business, filed any notice under any Environmental Law reporting past or present treatment, storage or disposal of a Hazardous Material (as defined below) or reporting a Release (as defined below) of a Hazardous Material;

                      (iv)   no Encumbrance in favor of any Governmental Entity for (A) any liability under Environmental Laws or (B) damages arising from or costs incurred by such Governmental Entity in response to a Release of a Hazardous Material or other substance into the environment has been filed or is attached to any property or assets of Company or any of its subsidiaries;

                       (v)   neither Company nor any of its subsidiaries has any material contingent liability in connection with (A) the Release or threatened Release into the environment at, beneath or on any property or facility now or previously owned, leased or operated by Company or any of its subsidiaries or (B) the storage or disposal of any Hazardous Material;

                    (vi)     neither Company nor any of its subsidiaries has received any claim, complaint, notice, letter of violation, inquiry or request for information involving any matter which remains unresolved as of the date hereof with respect to any alleged violation of any Environmental Law or regarding potential liability under any Environmental Law relating to operations or conditions of any facility or property (including off–site storage or disposal of any Hazardous Material from such facility or property) currently or formerly owned, leased or operated by Company or any of its subsidiaries;

                    (vii)    no property now or previously owned, leased or operated by Company or any of its subsidiaries is listed on the National Priorities List pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended ("CERCLA"), or on the Comprehensive Environmental Response, Compensation and Liability Information System List ("CERCLIS") or on any other federal or state list as a site requiring investigation or cleanup;

                    (viii)    neither Company nor any of its subsidiaries is transporting, has transported or is arranging for the transportation of any Hazardous Material to any location which is listed on the National Priorities List pursuant to CERCLA, on the CERCLIS, or on any similar federal or state list or which is the subject of federal, state or local enforcement actions or other investigations that would reasonably be expected to lead to material claims against Company for removal or remedial work, contribution for removal or remedial work, damage to natural resources or personal injury, including claims under CERCLA;

                     (ix)    there are no sites, locations or operations at which Company or any of its subsidiaries is currently undertaking, or has completed, any removal, remedial or response action relating to any such disposal or release, as required by Environmental Laws;

                     (x)    Company and each of its subsidiaries has obtained all permits, licenses, franchises, variances, authorizations, consents, certificates, exemptions, orders and approvals from all Governmental Entities ("Environmental Permits") that are required in respect of its business or operations under any applicable Environmental Law, and each of such Environmental Permits is in full force and effect; Company has complied with all such Environmental Permits in all material respects, and there is no action, investigation or proceeding pending or, to the knowledge of Company, threatened regarding any Environmental Permit;

                    (xi)    neither Company nor any of its subsidiaries owns or operates any underground storage tanks, treatment, storage or disposal facilities under the Resource Conservation and Recovery Act, as amended, or any successor statutes or regulations promulgated thereunder, or solid waste disposal facilities; and

                    (xii)    Company and each of its subsidiaries have provided Parent all environmental audits, tests, results of investigations and analyses that have been performed with respect to any property or facility currently or formerly owned, leased or operated by the Company or any of its subsidiaries.

        (b) As used herein:

                     (i)     "Environmental Law" means any Legal Requirement or order, judgment or decree relating to the protection of human health, safety or the environment or to emissions, discharges or Releases of pollutants, contaminants, or chemicals, or industrial, toxic or hazardous substances or wastes, into the environment (including structures, ambient air, soil, surface water, ground water, wetlands, land or subsurface strata), or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of pollutants, contaminants, chemicals or industrial, toxic or hazardous substances or wastes, including petroleum and petroleum products and byproducts.

                     (ii)     "Hazardous Material" means (A) any chemicals or other materials or substances that are defined as or included in the definition of "hazardous substances," "hazardous wastes," "hazardous materials," "extremely hazardous wastes," "restricted hazardous wastes," "toxic substances," "pollutants," "contaminants," or words of similar import under any Environmental Law, including petroleum and petroleum products and byproducts and radioactive materials (including naturally occurring radioactive materials); and (B) any other chemical, material or substance, the presence of or exposure to which is prohibited, limited or regulated by any Governmental or Regulatory Authority under any Environmental Law.

                     (iii)    "Release" means any actual or threatened (as defined under CERCLA) release, spill, effluent, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching or migration into the environment or any structure.

         Section 3.25    Brokers' and Finders' Fees.    Except for fees payable to Alan L. Edgar pursuant to an engagement letter that has been provided to Parent, which shall be borne and paid by Company, Company has not incurred, nor will it incur, directly or indirectly, any liability for brokerage or finders' fees or agents' commissions or any similar charges in connection with this Agreement or any transaction contemplated hereby.

         Section 3.26     Insurance.    Company and each of its subsidiaries have policies of insurance and bonds of the types and in amounts customarily carried by persons conducting business or owning assets similar to those of Company and its subsidiaries. There is no material claim pending under any of such policies or bonds as to which coverage has been questioned, denied or disputed by the underwriters of such policies or bonds. All premiums due and payable under all such policies have been paid and Company and its subsidiaries are otherwise in compliance in all material respects with the terms of such policies and bonds. There has been no threatened termination of, or material premium increase with respect to, any of such material policies.

         Section 3.27     Disclosure.    Neither the Schedule 14D–9, nor any of the information supplied or to be supplied by Company or its subsidiaries or representatives for inclusion or incorporation by reference in the Registration Statement, the Post–Effective Amendment (as defined below) or the Offer Documents will, at the respective times any such documents or any amendments or supplements thereto are filed with the SEC, are first published, sent or given to stockholders or become effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. The Schedule 14D–9 will comply as to form in all material respects with the requirements of all applicable laws, including the Exchange Act and the rules and regulations thereunder. No representation or warranty is made by Company with respect to statements made or incorporated by reference in any such documents based on information supplied by Parent or Merger Sub specifically for inclusion or incorporation by reference therein.

        Section 3.28     Fairness Opinion.    Company's Board of Directors has received an oral opinion from C.K. Cooper and Company, to be followed by a written opinion, to the effect that, as of the date hereof, the consideration to be received by Company's stockholders in the Offer and the Merger is fair to Company's stockholders from a financial point of view.

         Section 3.29     Affiliates.    Except as set forth in Company SEC Reports, since the date of Company's last proxy statement filed with the SEC, to the knowledge of Company, no event has occurred as of the date of this Agreement that would be required to be reported by Company pursuant to Item 404 of Regulation S–K promulgated by the SEC.

         Section 3.30     Disclosure.    (a) The representations, warranties and other statements by Company contained in this Agreement or in the Disclosure Letter do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements and information contained therein not misleading.

         (b)    Company has furnished to Parent an estimate of Company's oil and gas reserves as of the date of the reports described in Schedule 3.30 of the Disclosure Letter (the "Reserve Reports"). To Company's knowledge, the information contained in the Reserve Reports regarding Company's Oil and Gas Interests was reasonable at such date and did not contain materially untrue statements of fact or omit to state material facts which if completely and accurately stated would have had a net effect upon the estimated net recoverable quantities of oil and gas reflected in the Reserve Reports. To Company's knowledge, all lease operating expenses outlined in the Reserve Reports were based upon good faith estimates of such expenses and are not materially inconsistent with Company's currently existing related contractual obligations and currently existing legal requirements.

ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF PARENT

        Except as disclosed in the disclosure letter delivered by Parent to Company dated as of the date hereof and certified by a duly authorized officer of Parent (the "Parent Disclosure Letter"), Parent represents and warrants to Company as follows:

        Section 4.1     Organization of Parent and Subsidiaries.    (a) Each of Parent and each of its subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to conduct its business in the manner in which its business is currently being conducted and to own, lease and operate the properties and assets used in connection therewith. Each of Parent and each of its subsidiaries is duly qualified to do business as a foreign corporation, and is in good standing, in each jurisdiction where the character of its properties owned or held under lease or the nature of its activities makes such qualification necessary, except to the extent that any failure to so qualify or be in good standing would not have a Material Adverse Effect on Parent or adversely affect the ability of Parent or Merger Sub to perform its obligations hereunder or to consummate the Merger. Forman Petroleum Corporation, a Louisiana corporation ("Forman"), will become a subsidiary of Parent upon completion of the Restructuring (as defined in Section 6.15 below). For purposes of this Article IV, Forman shall be considered to be a subsidiary of Parent.

        (b)     Schedule 4.1 of the Parent Disclosure Letter indicates the jurisdiction of organization of each subsidiary of Parent and Parent's direct or indirect equity interest therein.

        (c)     Parent has delivered or made available to Company a true, complete and correct copy of the Articles of Incorporation and Bylaws of Parent and each of its subsidiaries, each as amended to date (collectively, the "Parent Charter Documents"), and each such instrument is in full force and effect. Neither Parent nor any of its subsidiaries is in violation of any of the provisions of the Parent Charter Documents.

        Section 4.2     Capitalization.    (a) The authorized capital stock of Parent consists solely of 20,000,000 shares of Common Stock, $0.001 par value per share ("Parent Common Stock"), of which there are 1,000 shares issued and outstanding, and 10,000,000 shares of Preferred Stock, $0.001 par value per share, of which no shares are issued or outstanding. All outstanding shares of Parent Common Stock are duly authorized, validly issued, fully paid and nonassessable and are not subject to preemptive rights created by statute, the Articles of Incorporation or Bylaws of Parent or any agreement or document to which Parent is a party or by which it is bound. Parent was formed for the purpose of consummating the Merger and the Restructuring and has no material assets or liabilities except as necessary for such purpose.

        (b)     The authorized capital stock of Merger Sub consists of 1,000 shares of common stock, $0.001 par value per share, all of which, as of the date hereof, are issued and outstanding and are held by Parent. All of the outstanding shares of Merger Sub's common stock have been duly authorized and validly issued, and are fully paid and nonassessable. Merger Sub was formed for the purpose of consummating the Merger and has no material assets or liabilities except as necessary for such purpose.

        (c)     The authorized capital stock of Forman consists solely of 10,000,000 shares of common stock, no par value per share, of which there were 984,042 shares issued and outstanding as of December 31, 2000, and 1,000,000 shares of preferred stock, par value $0.01 per share, of which no shares are issued or outstanding. All outstanding shares of common stock of Forman are duly authorized, validly issued, fully paid and nonassessable. There are no shares of common stock of Forman held in treasury by Forman. As of the close of business on December 31, 2000, 490,516 shares of common stock of Forman were subject to issuance pursuant to outstanding warrants to purchase common stock of Forman.

        (d)     All outstanding shares of Parent Common Stock and all outstanding shares of capital stock of each subsidiary of Parent have been issued and granted in compliance with (i) all applicable securities laws and other applicable material Legal Requirements and (ii) all material requirements set forth in applicable agreements or instruments.

        (e)     The Parent Preferred Stock to be issued in the Offer and the Merger is duly authorized and, when issued in accordance with the provisions of this Agreement, will be validly issued, fully paid and nonassessable.

        Section 4.3     Obligations With Respect to Capital Stock.    (a) Except as set forth in Section 4.2, there are no equity securities, partnership interests or similar ownership interests of any class of Parent equity security, or any securities exchangeable or convertible into or exercisable for such equity securities, partnership interests or similar ownership interests, issued, reserved for issuance or outstanding.

        (b)     Except for securities Parent owns free and clear of all claims and Encumbrances, directly or indirectly through one or more subsidiaries, there are no equity securities, partnership interests or similar ownership interests of any class of equity security of any subsidiary of Parent, or any security exchangeable or convertible into or exercisable for such equity securities, partnership interests or similar ownership interests, issued, reserved for issuance or outstanding.

        (c)     Except as set forth in Section 4.2, there are no subscriptions, options, warrants, equity securities, partnership interests or similar ownership interests, calls, rights (including preemptive rights), commitments or agreements of any character to which Parent or any of its subsidiaries is a party or by which it is bound obligating Parent or any of its subsidiaries to issue, deliver or sell, or cause to be issued, delivered or sold, or repurchase, redeem or otherwise acquire, or cause the repurchase, redemption or acquisition of, any shares of capital stock, partnership interests or similar ownership interests of Parent or any of its subsidiaries or obligating Parent or any of its subsidiaries to grant, extend, accelerate the vesting of or enter into any such subscription, option, warrant, equity security, call, right, commitment or agreement.

        Section 4.4     Authority; Non–Contravention.    (a) Each of Parent and Merger Sub has all requisite corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Parent and Merger Sub, subject only to the filing of the Articles of Merger pursuant to Nevada Law. No approval of any holder of any securities of Parent is required in connection with the consummation of the transactions contemplated hereby. This Agreement has been duly executed and delivered by each of Parent and Merger Sub and, assuming the due authorization, execution and delivery by Company, constitutes the valid and binding obligations of Parent and Merger Sub, respectively, enforceable against Parent and Merger Sub in accordance with its terms, except as enforceability may be limited by bankruptcy and other similar laws affecting the rights of creditors generally and general principles of equity.

        (b)     The execution and delivery of this Agreement by each of Parent and Merger Sub do not, and the performance of this Agreement by Parent and Merger Sub will not: (i) conflict with or violate the Parent Charter Documents, (ii) subject to compliance with the requirements set forth in Section 4.4(c), conflict with or violate any law, rule, regulation, order, judgment or decree applicable to Parent or any of its subsidiaries or by which any of their respective properties is bound or affected, or (iii) result in any breach of or constitute a default (or an event that, with notice or lapse of time or both, would become a default) under, or impair Parent's rights or alter the rights or obligations of any third party under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of an Encumbrance on any of the properties or assets of Parent or any of its subsidiaries pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, concession or other instrument or obligation to which Parent or any of its subsidiaries is a party or by which Parent or any of its subsidiaries or any of their respective properties are bound or affected, except, in the case of clauses (ii) and (iii), for such conflicts, violations, breaches, defaults, impairments, or rights which, individually or in the aggregate, would not have a Material Adverse Effect on Parent. Schedule 4.4(b) of the Parent Disclosure Letter lists all consents, waivers and approvals under any of Parent's or any of its subsidiaries' agreements, contracts, licenses or leases required to be obtained in connection with the consummation of the transactions contemplated hereby, which, if individually or in the aggregate not obtained, would result in a material loss of benefits to Parent or the Surviving Corporation as a result of the Merger.

        (c)     No consent, approval, order or authorization of, or registration, declaration or filing with, any Governmental Entity or other person is required to be obtained or made by Parent or any of its subsidiaries in connection with the execution and delivery of this Agreement or the consummation of the Offer or Merger, except for (i) the filing of the Articles of Merger with the Secretary of State of the State of Nevada, (ii) compliance with any applicable requirements of the Securities Act, the Exchange Act, and any other applicable securities law, whether state or foreign, and (iii) such other consents, authorizations, filings, approvals and registrations which if not obtained or made would not be material to Parent or the Surviving Corporation or have a material adverse effect on the ability of the parties hereto to consummate the transactions contemplated hereby.

        Section 4.5    Title to Oil and Gas Interests.    (a) Except as set forth in Schedule 4.5 of the Parent Disclosure Letter, Parent and its subsidiaries have Good Title to all Oil and Gas Interests of Parent or its subsidiaries.

        Section 4.6    Oil and Gas Interests of Parent and its Subsidiaries.    Except as set forth in Schedule 4.6 of the Parent Disclosure Letter: (i) there are no preferential purchase rights, first refusal rights or other similar contractual rights granted to any third parties applicable to any Oil and Gas Interests of Parent or its subsidiaries; (ii) neither Parent nor any of its subsidiaries has been advised by any operator, lessor or any other party of any default under any such Oil and Gas Interests which default has not heretofore been cured in all respects; (iii) all proper and timely payments (including royalties, delay rentals and shut–in royalties) due under the Oil and Gas Interests of Parent or its subsidiaries have been timely made and paid by the operator(s) of each such lease or well; and (iv) Parent and its subsidiaries are entitled to be paid, and are being paid, in all material respects, their percentage of net revenue interests included in such Oil and Gas Interests without suspense.

        Section 4.7     Refund.    Except as included or reflected on the Forman Balance Sheet (as defined in Section 4.17(c) below) or as set forth in Schedule 4.7 of the Parent Disclosure Letter: (i) neither Parent nor any of its subsidiaries is obligated by virtue of a prepayment arrangement under any gas contract containing a "take or pay" or similar provision, a production payment or any other arrangement to deliver any material amount of gas or oil attributable to the Oil and Gas Interests of Parent and its subsidiaries at some future time without then or thereafter receiving full payment therefor; and (ii) neither Parent nor any of its subsidiaries has received any funds or payments from purchasers of production of gas under gas contracts which are subject to a potential material refund.

        Section 4.8     Payout Balances.    Schedule 4.8 of the Parent Disclosure Letter contains a reasonably complete and accurate list of the status, as of December 31, 2000, with respect to Parent operated wells, and as of December 31, 2000, with respect to third party operated wells, of: (a) the "payout" balance for each Oil and Gas Interests of Parent and its subsidiaries that is subject to a reversion or other adjustment at some level of cost recovery or payout (or passage of time or other event, other than cessation of production); and (b) all gas balancing obligations and rights for each such Oil and Gas Interest which is subject to a gas balancing overage or underage. As used in this Section 4.8 and in Section 4.9, the term "Parent operated wells" shall also include all wells operated by any of Parent's subsidiaries.

        Section 4.9     Operations.    Except as set forth in Schedule 4.9 of the Parent Disclosure Letter:

        (a)    All of the Parent operated wells included in the Oil and Gas Interests of Parent and its subsidiaries and which are described in Schedule 4.9 of the Parent Disclosure Letter have been drilled within the boundaries of such Oil and Gas Interests or within the limits otherwise permitted by contract, pooling or unit agreement, lease instrument, and by law and in accordance with generally prevailing standards of the oil and gas industry.

        (b)    All drilling and completion of the Parent operated wells in such Oil and Gas Interests and all development and operations on such Oil and Gas Interests have been conducted in compliance in all material respects with all applicable laws, ordinances, rules, regulations and permits, and judgments, orders, and decrees of any court or governmental body or agency.

        (c)    With respect to Parent operated wells, all equipment constituting part of the Oil and Gas Interests of Parent and its subsidiaries has been installed, maintained, and operated by Parent or its subsidiaries as a prudent operator in accordance with generally prevailing standards of the oil and gas industry, and is currently in a state of repair so as to be adequate for normal operations by Parent or its subsidiaries, except where the failure to do so would not, individually or in the aggregate, have a Material Adverse Effect on Parent.

        (d)    No Parent operated well included in such Oil and Gas Interests is subject to penalties on allowables because of any overproduction (legal or illegal) which would prevent the full legal and regular allowable (including maximum permissible tolerance) as prescribed by any court or federal, state or local governmental body or agency to be assigned to any such well.

        Section 4.10     Plugging Status.    All wells operated by Parent or any of its subsidiaries that have been permanently plugged and abandoned have been so plugged and abandoned in accordance in all material respects with all applicable laws, ordinances, rules, regulations and permits, and judgments, orders, and decrees of any court or governmental body or agency.

        Section 4.11     Financial and Commodity Hedging.    Schedule 4.11 of the Parent Disclosure Letter accurately summarizes the outstanding hydrocarbon and financial hedging positions of Parent and its subsidiaries (including fixed price controls, collars, swaps, caps, hedges and puts) as of the date reflected on the Parent Disclosure Letter.

        Section 4.12     Governmental Regulation.    Neither Parent nor any of its subsidiaries is subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act, the Investment Company Act of 1940 or any state public utilities laws.

        Section 4.13     Compliance with Laws.    (a) Neither Parent nor any of its subsidiaries is in conflict with, or has violated or is in violation of any Legal Requirement applicable to Parent or any of its subsidiaries or by which Parent or any of its subsidiaries or any of their respective properties is bound or affected, except for conflicts or violations that, individually or in the aggregate, would not have a Material Adverse Effect on Parent or adversely affect the ability of Parent or Merger Sub to perform its obligations hereunder or to consummate the Merger. No investigation or review by any Governmental Entity is pending or, to Parent's knowledge, has been threatened against Parent or any of its subsidiaries, nor, to Parent's knowledge, has any Governmental Entity indicated an intention to conduct an investigation of Parent or any of its subsidiaries. There is no judgment, injunction, order or decree binding upon Parent or any of its subsidiaries which has or could reasonably be expected to have the effect of prohibiting or impairing any business practice of Parent or any of its subsidiaries, or any acquisition of property by Parent or any of its subsidiaries.

        (b)     Parent and its subsidiaries hold all permits, licenses, franchises, variances, authorizations, consents, certificates, exemptions, orders and approvals from governmental authorities that are material to or required to own, lease and operate its properties and for the operation of the business of Parent and its subsidiaries as currently conducted (collectively, the "Parent Permits"), and are in compliance with the terms of the Parent Permits. Each of the Parent Permits is in full force and effect and there is no action, investigation or proceeding pending or, to the knowledge of Parent, threatened regarding any Parent Permit.

        Section 4.14     Litigation.    There are no claims, suits, actions, investigations or proceedings pending or, to the knowledge of Parent, threatened against, relating to or affecting Parent, any of its subsidiaries, any officer, director or employee of Parent or any of its subsidiaries, or any person for whom Parent or any of its subsidiaries may be liable or any of their respective properties, before any Governmental Entity or any arbitrator that seeks to restrain or enjoin the consummation of the transactions contemplated by this Agreement or which would reasonably be expected, either singly or in the aggregate with all such claims, actions or proceedings, to have a Material Adverse Effect or adversely affect the ability of Parent or Merger Sub to perform its obligations hereunder or to consummate the Merger. As of the date hereof, no director or executive officer of Parent has asserted a claim to seek indemnification from Parent under Parent Charter Documents or any indemnification agreement between Parent and such person.

        Section 4.15     Brokers' and Finders' Fees.    Except for fees payable to Jefferies & Company, Inc. and Jeffrey Clarke, which shall be borne and paid by Parent, Parent has not incurred, nor will it incur, directly or indirectly, any liability for brokerage or finders' fees or agents' commissions or any similar charges in connection with this Agreement or any transaction contemplated hereby.

        Section 4.16     Disclosure Documents.    Neither the Offer Documents, the Registration Statement, the Post–Effective Amendment, nor any of the information supplied or to be supplied by Parent or its subsidiaries or representatives for inclusion or incorporation by reference in the Schedule 14D–9 or the Company Proxy Statement will, at the respective times any such documents or any amendments or supplements thereto are filed with the SEC, are first published, sent or given to stockholders or become effective under the Securities Act or, in the case of the Company Proxy Statement, at the time of the Company Stockholders Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. The Offer Documents, the Registration Statement and the Post–Effective Amendment will comply as to form in all material respects with the requirements of all applicable laws, including the Securities Act and the Exchange Act, as applicable, and the rules and regulations thereunder. No representation or warranty is made by Parent or Merger Sub with respect to statements made or incorporated by reference therein based on information supplied by Company for inclusion or incorporation by reference therein.

        Section 4.17     SEC Reports; Forman Financial Statements.    (a) Forman has timely filed all forms, reports, schedules, statements and documents required to be filed by Forman with the SEC since December 31, 1999, and Parent has made available to Company such forms, reports, schedules, statements and documents in the form filed with the SEC. All such required forms, reports, schedules, statements and documents are referred to herein as the "Forman SEC Reports."

        (b)    As of their respective dates, the Forman SEC Reports (i) were prepared in accordance with the requirements of the Securities Act or the Exchange Act, as the case may be, and the rules and regulations of the SEC thereunder applicable to such Forman SEC Reports and (ii) did not at the time they were filed (or, if amended or superseded by a filing prior to the date of this Agreement, then on the date of such filing) contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Neither Parent nor any of Parent's subsidiaries, other than Forman, is required to file any forms, reports or other documents with the SEC.

        (c)    Each of the consolidated financial statements of Forman (including, in each case, any related notes thereto) contained in the Forman SEC Reports (the "Forman Financials"): (i) complies as to form in all material respects with the published rules and regulations of the SEC with respect thereto, (ii) was prepared in accordance with GAAP applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto or, in the case of unaudited interim financial statements, as may be permitted by the SEC under Form 10–Q, 8–K or any successor form under the Exchange Act) and (iii) fairly presents the consolidated financial position of Forman as at the respective dates thereof and the consolidated results of Forman's operations and cash flows for the periods indicated, except that the unaudited interim financial statements may not contain footnotes and were or are subject to normal and recurring year–end adjustments. The balance sheet of Forman contained in the Forman SEC Reports as of September 30, 2000, is hereinafter referred to as the "Forman Balance Sheet."

        Section 4.18     Undisclosed Liabilities.    Except as set forth in Schedule 4.18 of the Parent Disclosure Letter, Forman does not have any liability (whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due, including any liability for Taxes), except for liabilities set forth on the face of the Forman Balance Sheet (or in one or more notes thereto) and liabilities which arose in the ordinary course of business since the date of the Forman Balance Sheet.

        Section 4.19     Absence of Certain Changes or Events.    Since the date of the Forman Balance Sheet, the business of Forman has been conducted in the ordinary course consistent with past practices (other than the transactions contemplated by this Agreement) and there has not been (i) any event, occurrence, development or state of circumstances or facts that has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Forman, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, Forman's capital stock, or any purchase, redemption or other acquisition by Forman of any of Forman's capital stock or any other securities of Forman or any options, warrants, calls or rights to acquire any such shares or other securities, except for repurchases which are not, individually or in the aggregate, material in amount from employees following their termination pursuant to the terms of their pre–existing stock option or purchase agreements, (iii) any material change by Forman in its accounting methods, principles or practices, except as required by changes in GAAP, or (iv) any revaluation by Forman of any of its material assets, other than in the ordinary course of business. Since the date of the Forman Balance Sheet and through the date of this Agreement, other than actions taken or to be taken in connection with the proposed Restructuring, Forman has not taken any action that, if taken after the date hereof, would constitute a breach of any provision of Section 5.1 hereof, if such provisions were applied to Forman.

        Section 4.20     Reserve Report.    Parent has furnished to Company an estimate of Forman's oil and gas reserves as of the date of the report described in Schedule 4.20 of the Parent Disclosure Letter (the "Forman Reserve Report"). To Parent's knowledge, the information contained in the Forman Reserve Report regarding the Oil and Gas Interests of Forman was reasonable at such date and did not contain materially untrue statements of fact or omit to state material facts which if completely and accurately stated would have had a net effect upon the estimated net recoverable quantities of oil and gas reflected in the Forman Reserve Report. To Forman's knowledge, all lease operating expenses outlined in the Forman Reserve Report were based upon good faith estimates of such expenses and are not materially inconsistent with Forman's currently existing related contractual obligations and currently existing legal requirements.

        Section 4.21     Disclosure.    The representations, warranties and other statements by Parent contained in this Agreement or in the Parent Disclosure Letter do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements and information contained therein not misleading.

ARTICLE V.
CONDUCT PRIOR TO THE EFFECTIVE TIME

        Section 5.1     Conduct of Business by Company.    During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, Company and each of its subsidiaries shall, except to the extent permitted, required or specifically contemplated by, or otherwise described in this Agreement or otherwise consented to or approved in writing by Parent or provided in Schedule 5.1 of the Disclosure Letter, carry on its business in the ordinary course, consistent with past practice and shall use its best efforts to (i) preserve intact its present business organization; (ii) maintain and effect all material federal, state and local permits that are required for the Company or any of its subsidiaries to carry on its business; (iii) keep available the services of its present officers and employees; and (iv) maintain satisfactory relationships with customers, lenders, suppliers, licensors, licensees, joint venture partners and others with which it has business dealings. In addition, during that period Company will promptly notify Parent of any material event involving its business or operations consistent with the agreements contained herein.

        In addition, except as permitted by the terms of this Agreement, and except as contemplated by this Agreement or provided in Schedule 5.1 of the Disclosure Letter, without the prior written consent of Parent, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, Company shall not do any of the following and, as applicable, shall not permit its subsidiaries to do any of the following:

        (a)    Waive any stock repurchase rights, accelerate, amend or change the period of exercisability of options or restricted stock, reprice options granted under any employee, consultant, director or other stock plans or authorize cash payments in exchange for any options granted under any of such plans;

        (b)    Grant any severance or termination pay to any officer or employee except pursuant to written agreements in effect, or policies existing, on the date hereof (or as required by applicable law), and as previously disclosed in writing to Parent, or adopt any new severance plan;

        (c)    As to Company only, declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any capital stock of Company or split, combine or reclassify any capital stock of Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock of Company;

        (d)    As to Company only, purchase, redeem or otherwise acquire, directly or indirectly, any shares of capital stock of Company, except repurchases of unvested shares at cost in connection with the termination of the employment relationship with any employee pursuant to stock option or purchase agreements in effect on the date hereof;

        (e)    Issue, deliver, sell, authorize, pledge or otherwise encumber any shares of capital stock or any securities convertible into shares of capital stock, or subscriptions, rights, warrants or options to acquire any shares of capital stock or any securities convertible into shares of capital stock, or enter into other agreements or commitments of any character obligating it to issue any such shares or convertible securities, other than the issuance, delivery and/or sale of shares of Company Common Stock pursuant to the exercise of Company Options, consistent with the terms thereof;

        (f)    Cause, permit or propose any amendments to its Articles of Incorporation, Bylaws or other charter documents (or similar governing instruments of any of its subsidiaries);

        (g)    Acquire or agree to acquire by merging or consolidating with, or, except as required by agreements listed in Schedule 5.1 of the Disclosure Letter, by purchasing any equity interest in or a portion of the assets of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise enter into any material joint ventures, strategic relationships or alliances;

        (h)    Sell, lease, license, encumber or otherwise dispose of any properties or assets which are material, individually or in the aggregate, to the business of Company and its subsidiaries, taken as a whole, other than (i) dispositions of oil, gas and other minerals in the ordinary course of business, consistent with past practice, (ii) pledges, mortgages, and encumbrances in the ordinary course of business, consistent with past practice, or (iii) entering into hedging positions consistent with past practice;

        (i)    Incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or options, warrants, calls or other rights to acquire any debt securities of Company, enter into any "keep well" or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing, other than in the ordinary course of business, consistent with past practice;

        (j)    Except as required to comply with any Legal Requirement or as set forth in Schedule 3.22 of the Disclosure Letter, adopt or amend any employee benefit plan or employee stock purchase or employee stock option plan, or enter into any employment contract or collective bargaining agreement, pay any special bonus or special remuneration to any director or employee, or increase the salaries or wage rates or fringe benefits (including rights to severance or indemnification) of its directors, officers, employees or consultants other than with respect to employees and consultants (other than officers) in the ordinary course of business, consistent with past practice, or change in any material respect any management policies or procedures that are material to the business of Company and its subsidiaries, taken as a whole;

        (k)    Make or commit to any capital expenditures, except in accordance with the current Company annual budget and plan (a copy of which has been previously provided to Parent and is included in Schedule 5.1 to the Disclosure Letter);

        (l)    Modify, amend or terminate any Company Contract to which Company or any of its subsidiaries is a party, or waive, release or assign any material rights or claims thereunder, other than in the ordinary course of business consistent with past practice;

        (m)    Enter into any licensing or other agreement with regard to the acquisition, distribution or licensing of any material intellectual property other than licenses, distribution or other similar agreements entered into in the ordinary course of business consistent with past practice;

        (n)    Revalue any of its assets or, except as required by GAAP, make any change in accounting methods, principles or practices;

        (o)    Make any material election with respect to Taxes;

        (p)    Take any action that would materially delay the consummation of the transactions contemplated hereby; or

        (q)    Agree in writing or otherwise to take any of the actions described in Section 5.1 (a) through (p) above.

ARTICLE VI.
ADDITIONAL AGREEMENTS

        Section 6.1    Stockholder Approval; Preparation of Registration Statement and Proxy Statement/Prospectus.    (a) If approval of Company's stockholders is required by applicable law in order to consummate the Merger, following the acceptance for payment of Shares pursuant to the Offer, Parent and Company shall, as soon as practicable thereafter, prepare a definitive proxy statement or information statement (such proxy or information statement and all amendments or supplements thereto, if any (the "Company Proxy Statement"), and Parent and Company shall prepare and Parent shall file with the SEC a post–effective amendment to the Registration Statement (the "Post–Effective Amendment") for the offer and sale of the Parent Preferred Stock pursuant to the Merger and in which the Company Proxy Statement will be included as a prospectus. Each of Company and Parent shall use all reasonable efforts to have the Post–Effective Amendment declared effective under the Securities Act as promptly as practicable after such filing. Company will use all reasonable efforts to cause the Company Proxy Statement to be mailed to Company's stockholders as promptly as practicable after the Post–Effective Amendment is declared effective under the Securities Act. Parent shall also take any action (other than qualifying to do business in any jurisdiction in which it is not now so qualified or to file a general consent to service of process) required to be taken under any applicable state securities laws in connection with the issuance of Parent Preferred Stock in the Offer and the Merger and Company shall furnish all information concerning Company and the holders of capital stock of Company as may be reasonably requested in connection with any such action and the preparation, filing and distribution of the Company Proxy Statement. No filing of, or amendment or supplement to, or correspondence to the SEC or its staff with respect to, the Post–Effective Amendment will be made by Parent, or the Company Proxy Statement will be made by Company, without providing the other party and its counsel a reasonable opportunity to review and comment thereon. Parent will advise Company, promptly after it receives notice thereof, of the time when the Post–Effective Amendment has become effective or any supplement or amendment has been filed, the issuance of any stop order, the suspension of the qualification of the Parent Preferred Stock issuable in connection with the Merger for offering or sale in any jurisdiction, or any request by the SEC for amendment of the Post–Effective Amendment or comments thereon and responses thereto or requests by the SEC for additional information. Company will advise Parent, promptly after it receives notice thereof, of any request by the SEC for the amendment of the Company Proxy Statement or comments thereon and responses thereto or requests by the SEC for additional information. If at any time prior to the Effective Time any information relating to Company or Parent, or any of their respective affiliates, officers or directors, should be discovered by Company or Parent which should be set forth in an amendment or supplement to either of the Post–Effective Amendment or the Company Proxy Statement, so that any of such documents would not include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, the party which discovers such information shall promptly notify the other parties hereto and an appropriate amendment or supplement describing such information shall be promptly filed with the SEC and, to the extent required by law, disseminated to the stockholders of Company.

        (b)     If approval of the Company's stockholders is required by applicable law in order to consummate the Merger, Company shall establish, prior to or as soon as practicable following the date upon which the Post–Effective Amendment becomes effective, a record date (which shall be prior to or as soon as practicable following the date upon which the Post–Effective Amendment becomes effective) for, duly call, give notice of, convene and hold a meeting of its stockholders (the "Company Stockholders Meeting") for the purpose of considering and taking action upon this Agreement and the Merger and (with the consent of Parent, which consent shall not be unreasonably withheld) such other matters as may in the reasonable judgment of Company be appropriate for consideration at the Company Stockholders Meeting. Once the Company Stockholders Meeting has been called and noticed, Company shall not postpone or adjourn the Company Stockholders Meeting (other than for the absence of a quorum) without the consent of Parent, which consent shall not be unreasonably withheld. Subject to Company's right, pursuant to Section 6.2(b), to withdraw or modify the Recommendations, the Board of Directors of Company shall include in the Post–Effective Amendment and the Company Proxy Statement a copy of the Recommendations as such Recommendations pertain to the Merger and this Agreement. Notwithstanding the foregoing, if approval of the Company's stockholders is required by applicable law in order to consummate the Merger, the Board of Directors of Company shall submit this Agreement and the Merger for approval to the Company's stockholders whether or not the Board of Directors of Company determines in accordance with Section 6.2(b) after the date hereof that this Agreement and the Merger are no longer advisable and recommends that the stockholders of Company reject it. Unless the Board of Directors of Company has withdrawn its recommendation of this Agreement and the Merger in compliance with Section 6.2(b), Company shall use its reasonable best efforts to solicit from stockholders of Company proxies in favor of this Agreement and the Merger and shall take all other actions necessary or advisable to secure the vote or consent of stockholders required by Nevada Law to effect the Merger.

        (c)     Notwithstanding the foregoing clauses (a) and (b) above, if Merger Sub shall acquire at least 90% of the outstanding Shares in the Offer, the parties hereto shall take all necessary actions (including actions referred to in clause (a) above, as applicable) to cause the Merger to become effective, as soon as practicable after the expiration of the Offer, without a meeting of stockholders of Company, in accordance with Section 92A.180 of Nevada Law, including the mailing of a copy or summary of the plan of Merger to each Company stockholder who does not waive the mailing requirement in writing.

        Section 6.2     No Solicitation.    (a) From the date hereof until the Effective Time or termination of the Agreement in accordance with Article VIII, whichever is earlier, neither Company nor any of its subsidiaries shall, nor shall Company or any of its subsidiaries authorize or permit any of its or their officers, directors, employees, investment bankers, attorneys, accountants, consultants, affiliates or other agents or advisors to, directly or indirectly: (i) solicit, initiate or knowingly take any action to facilitate or encourage the submission or announcement of any Acquisition Proposal (as defined below), (ii) enter into or participate in any discussions or negotiations with, furnish any nonpublic information relating to Company or any of its subsidiaries or afford access to the business, properties, assets, books or records of Company or any of its subsidiaries to, otherwise cooperate in any way with, or knowingly assist, participate in, facilitate or encourage any effort by any third party that has made an Acquisition Proposal, (iii) approve, endorse or recommend any Acquisition Proposal, or (iv) enter into any letter of intent or similar document or any contract, agreement or commitment contemplating or otherwise relating to any Acquisition Proposal.

        (b)    Notwithstanding the foregoing, the Board of Directors of Company, directly or indirectly through advisors, agents or other intermediaries, may (i) engage in negotiations or discussions with any third party that, subject to Company's compliance with Section 6.2(a), has made (and not withdrawn) a bona fide Acquisition Proposal that the Board of Directors of Company reasonably determines (after consultation with Company's financial advisor) constitutes a Superior Proposal (as defined below), (ii) furnish to such third party nonpublic information relating to Company or any of its subsidiaries pursuant to a confidentiality agreement with terms no less favorable to Company than those contained in the confidentiality agreement between Parent and Company, (iii) take and disclose to its stockholders a position contemplated by Rule 14e–2(a) under the Exchange Act or otherwise make disclosure to them, (iv) following receipt of such an Acquisition Proposal, withdraw, modify in a manner adverse to Parent, or fail to make its Recommendations, and/or (v) take any action ordered to be taken by Company by any court of competent jurisdiction, if, in each case (1) neither Company nor any representative of Company and its subsidiaries shall have violated any of the restrictions set forth in this Section 6.2, (2) the Board of Directors of Company determines in good faith, after consultation with its outside legal counsel, that it is necessary for the Board of Directors to take such action in order to satisfy its fiduciary obligations to Company's stockholders under applicable law, (3) prior to furnishing any such nonpublic information to, or entering into any such discussions with, such person or group, Company gives Parent written notice of the identity of such person or group and all of the material terms and conditions of such Acquisition Proposal and of Company's intention to furnish nonpublic information to, or enter into discussions with, such person or group, and Company receives from such person or group an executed confidentiality agreement containing terms at least as restrictive with regard to Company's confidential information as the confidentiality agreement between Parent and Company, (4) Company gives Parent prompt advance notice of its intent to furnish such nonpublic information or enter into such discussions (which notice shall in no event be given less than one business day prior to furnishing such information or entering into such discussions), and (5) contemporaneously with furnishing any such nonpublic information to such person or group, Company furnishes such nonpublic information to Parent (to the extent such nonpublic information has not been previously furnished by Company to Parent). Company and its subsidiaries will immediately cease any and all existing activities, discussions or negotiations with any parties conducted heretofore with respect to any Acquisition Proposal. Without limiting the foregoing, it is understood that any violation of the restrictions set forth in the preceding two sentences by any officer, director or employee of Company or any of its subsidiaries or any investment banker, attorney or other advisor or representative of Company or any of its subsidiaries shall be deemed to be a breach of this Section 6.2 by Company.

        (c)    In addition to the obligations of Company set forth in paragraph (a) of this Section 6.2, Company, as promptly as reasonably practicable, shall advise Parent orally and in writing of any Acquisition Proposal, or any inquiry with respect to or which Company reasonably should believe would lead to any Acquisition Proposal, the material terms and conditions of such Acquisition Proposal or inquiry, and the identity of the person or group making any such Acquisition Proposal or inquiry. Company will keep Parent informed as promptly as reasonably practicable in all material respects of material amendments of any such Acquisition Proposal or inquiry.

        For purposes of this Agreement, "Superior Proposal" means any bona fide, unsolicited written Acquisition Proposal for at least a majority of the outstanding shares of Company Common Stock on terms that the Board of Directors of Company determines in good faith by a majority vote, after consultation with its financial advisor and taking into account all the terms and conditions of the Acquisition Proposal, are more favorable to the Company's stockholders than as provided hereunder and which is reasonably capable of being consummated.

        For purposes of this Agreement, "Acquisition Proposal" shall mean any offer or proposal by a third party, other than Parent, Merger Sub or any affiliate thereof, relating to: (A) any acquisition or purchase from Company by any person or "group" (as defined under Section 13(d) of the Exchange Act and the rules and regulations thereunder) of more than a 15% interest in the outstanding voting securities of Company or any of its subsidiaries or any tender offer or exchange offer that if consummated would result in any person or "group" (as defined under Section 13(d) of the Exchange Act and the rules and regulations thereunder) beneficially owning 15% or more of the outstanding voting securities of Company or any of its subsidiaries or any merger, consolidation, business combination or similar transaction involving Company pursuant to which the stockholders of Company immediately preceding such transaction would hold less than 85% of the equity interests in the surviving or resulting entity of such transaction; (B) any sale, lease (other than in the ordinary course of business), exchange, transfer, license (other than in the ordinary course of business), acquisition, or disposition of more than 15% of the consolidated assets of Company; or (C) any liquidation or dissolution of Company.

        Section 6.3     Obligations of Merger Sub.    Parent will take all action necessary to cause Merger Sub to perform its obligations under this Agreement and to consummate the Offer and the Merger on the terms and subject to the conditions set forth in this Agreement.

        Section 6.4     Voting of Shares.    Parent and Merger Sub agree to vote all Shares acquired in the Offer or otherwise beneficially owned by them or any of their subsidiaries in favor of approval and adoption of this Agreement and the Merger at the Company Stockholder Meeting, on the terms and subject to the conditions set forth in this Agreement.

        Section 6.5     Registration Statement.    Parent shall promptly prepare and file with the SEC under the Securities Act the Registration Statement and shall use all reasonable efforts to cause the Registration Statement to be declared effective by the SEC as promptly as reasonably practicable. Parent shall promptly take any action required to be taken under foreign or state securities laws in connection with the issuance of Parent Preferred Stock in the Offer and the Merger.

        Section 6.6     Confidentiality; Access to Information.    (a) Prior to the Effective Time and after any termination of this Agreement, each of Parent and Company will hold, and will use its best efforts to cause its officers, directors, employees, accountants, counsel, consultants, advisors, affiliates and agents to hold, in confidence, unless compelled to disclose by judicial or administrative process or by other Legal Requirements, all confidential documents and information concerning the other party furnished to it or its affiliates in connection with the transactions contemplated by this Agreement, except to the extent that such information can be shown to have been (i) previously known on a nonconfidential basis by such party, (ii) in the public domain through no fault of such party or (iii) later lawfully acquired by such party from sources other than the other party; provided, that each of Parent and Company may disclose such information to its officers, directors, employees, accountants, counsel, consultants, advisors, affiliates, lenders and agents in connection with the transactions contemplated by this Agreement so long as such party informs such persons of the confidential nature of such information and directs them to treat it confidentially. Each of Parent and Company shall satisfy its obligation to hold any such information in confidence if it exercises the same care with respect to such information as it would take to preserve the confidentiality of its own similar information. If this Agreement is terminated, each of Parent and Company will, and will use its best efforts to cause its officers, directors, employees, accountants, counsel, consultants, advisors and agents to, destroy or deliver to the other party, upon request, all documents and other materials, and all copies thereof, that it or its affiliates obtained, or that were obtained on their behalf, from the other party in connection with this Agreement and that are subject to such confidence.

        (b)     Each of Company and Parent will afford the other party and the other party's accountants, counsel and other representatives reasonable access during normal business hours to its properties, books, records and personnel, and those of its subsidiaries, during the period prior to the Effective Time to obtain all information concerning its and their business, including the status of exploration, production and development efforts, properties, results of operations, prospects and personnel, as the other party may reasonably request, including copies of working papers of accountants, contracts, and other corporate documents, and access to other parties with whom it has business dealings. No information or knowledge obtained in any investigation pursuant to this Section 6.6 will affect or be deemed to modify any representation or warranty contained herein or the conditions to the obligations of the parties to consummate the Offer and the Merger.

        Section 6.7     Public Disclosure.    Parent and Company will consult with each other and, to the extent practicable, agree, before issuing any press release or otherwise making any public statement with respect to the Offer, the Merger, this Agreement or an Acquisition Proposal, and will not issue any such press release or make any such public statement prior to such consultation, except as may be required by law or any listing agreement with Nasdaq. The parties have agreed to the text of the joint press release announcing the signing of this Agreement.

        Section 6.8     Reasonable Best Efforts; Notification.    (a) Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use all reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Merger and the other transactions contemplated by this Agreement, including using reasonable efforts to accomplish the following: (i) the taking of all reasonable acts necessary to cause the conditions precedent set forth in Annex I and Article VII to be satisfied; (ii) the obtaining of all necessary actions or non–actions, waivers, consents, approvals, orders and authorizations from Governmental Entities and the making of all necessary registrations, declarations and filings (including registrations, declarations and filings with Governmental Entities, if any) and the taking of all reasonable steps as may be necessary to avoid any suit, claim, action, investigation or proceeding by any Governmental Entity; (iii) the obtaining of all necessary consents, approvals or waivers from third parties; (iv) the defending of any suits, claims, actions, investigations or proceedings, whether judicial or administrative, challenging this Agreement or the consummation of the transactions contemplated hereby, including seeking to have any stay or temporary restraining order entered by any court or other Governmental Entity vacated or reversed; and (v) the execution or delivery of any additional instruments necessary to consummate the transactions contemplated by, and to carry out fully the purposes of, this Agreement. Notwithstanding anything in this Agreement to the contrary, neither Parent nor any of its affiliates shall be under any obligation to make proposals, execute or carry out agreements or submit to orders providing for the sale or other disposition or holding separate (through the establishment of a trust or otherwise) of any assets or categories of assets of Parent, any of its affiliates or Company or its subsidiaries or the holding separate of the shares of Company Common Stock (or shares of stock of the Surviving Corporation) or imposing or seeking to impose any limitation on the ability of Parent or any of its subsidiaries or affiliates to conduct their business or own such assets or to acquire, hold or exercise full rights of ownership of the shares of Company Common Stock (or shares of stock of the Surviving Corporation).

        (b)     Each of Company and Parent will give prompt notice to the other of (i) any notice or other communication from any person alleging that the consent of such person is or may be required in connection with the transactions contemplated hereby, (ii) any notice or other communication from any Governmental Entity in connection with the transactions contemplated hereby, and (iii) any litigation relating to, involving or otherwise affecting Company, Parent or their respective subsidiaries that relates to the consummation of the transactions contemplated hereby. Company shall give prompt notice to Parent of any representation or warranty made by it contained in this Agreement becoming untrue or inaccurate, or any failure of Company to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by it under this Agreement, in each case, such that the conditions set forth in Annex I or Article VII would not be satisfied; provided, however, that no such notification shall affect the representations, warranties, covenants or agreements of the parties or the conditions to the obligations of the parties under this Agreement. Parent shall give prompt notice to Company of any representation or warranty made by it or Merger Sub contained in this Agreement becoming untrue or inaccurate, or any failure of Parent or Merger Sub to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by it under this Agreement, in each case, such that the conditions set forth in Annex I or Article VII would not be satisfied; provided, however, that no such notification shall affect the representations, warranties, covenants or agreements of the parties or the conditions to the obligations of the parties under this Agreement.

        Section 6.9     Indemnification.    (a) From and after the Effective Time, Parent shall, and shall cause the Surviving Corporation to, fulfill and honor in all respects the obligations of Company pursuant to any indemnification agreements between Company and its directors and officers as of the Effective Time (the "Indemnified Parties") and any indemnification provisions under Company's or the Surviving Corporation's Articles of Incorporation or Bylaws as in effect on the date hereof or at the Effective Time. The Articles of Incorporation and Bylaws of the Surviving Corporation will contain provisions with respect to exculpation and indemnification that are at least as favorable to the Indemnified Parties as those contained in the Articles of Incorporation and Bylaws of Company as in effect on the date hereof, which provisions will not be amended, repealed or otherwise modified for a period of three years from the Effective Time in any manner that would adversely affect the rights thereunder of individuals who, immediately prior to the Effective Time, were directors, officers, employees or agents of Company, unless such modification is required by law.

        (b)     In the event that Parent or any of its successors or assigns (i) consolidates with or merges into any other person and shall not be the continuing or surviving corporation or entity of such consolidation or merger, or (ii) transfers all or substantially all of its properties and assets to any person in a single transaction or a series of transactions, then, and in each such case, Parent shall make or cause to be made proper provision so that the successors and assigns of Parent assume the indemnification obligations of Parent under this Section 6.9 for the benefit of the Indemnified Parties.

        (c)    For a period of the lesser of either the applicable statute of limitations or five years after the Effective Time, Parent will either (i) cause the Surviving Corporation to maintain in effect, if available, directors' and officers' liability insurance covering those persons who are currently covered by Company's directors' and officers' liability insurance policy on terms comparable to those applicable to the current directors and officers of Company; provided, however, that in no event will Parent or the Surviving Corporation be required to expend in excess of 150% of the annual premium currently paid by Company for such coverage (or such coverage as is available for such 150% of such annual premium), or (ii) if mutually agreed between Company and Parent, purchase directors' and officers' liability insurance on terms comparable to those applicable to the current directors and officers of Company covering all periods prior to the Effective Time.

        (d)    This Section 6.9 shall survive the consummation of the Merger, is intended to benefit Company, the Surviving Corporation and each Indemnified Party, shall be binding on all successors and assigns of the Surviving Corporation and Parent, and shall be enforceable by the Indemnified Parties.

        Section 6.10     Letters of Accountants.    Company and Parent shall use their respective reasonable efforts to cause to be delivered to Parent letters of Company's and Parent's independent accountants, respectively, dated no more than two business days before the date on which the Registration Statement becomes effective (and satisfactory in form and substance to Parent), that is customary in scope and substance for letters delivered by independent public accountants in connection with registration statements similar to the Registration Statement.

        Section 6.11     Takeover Statutes.    If any takeover statute is or may become applicable to the Merger or the other transactions contemplated by this Agreement, each of Parent and Company and their respective Boards of Directors shall grant such approvals and take such lawful actions as are necessary to ensure that such transactions may be consummated as promptly as practicable on the terms contemplated by this Agreement and otherwise act to eliminate or minimize the effects of such statute and any regulations promulgated thereunder on such transactions. Company agrees that on and after the date hereof, it will not adopt any "poison pill" rights plan or any similar anti–takeover plan or take any other action that would impede or prevent completion of the Offer, the Merger or this Agreement.

        Section 6.12     Certain Employee Benefits.    Employees of Company and its subsidiaries will be granted credit for purposes of eligibility, vesting and vacation accrual for all service with Company and its subsidiaries under each employee benefit plan, program or arrangement of Parent or its affiliates in which such Employees are eligible to participate. If Employees become eligible to participate in a welfare plan maintained or contributed to by Parent or its affiliates, Parent will cause such plan to (i) waive any pre–existing condition exclusions and waiting period limitations for conditions covered under the applicable welfare plan under which Company employees participate (but only to the extent corresponding exclusions and limitations were satisfied by such Employees under the applicable welfare plans maintained or contributed to by Company); and (ii) credit any deductible or out–of–pocket expenses or offsets (or similar expenses) incurred by the Employees and their beneficiaries under such plans during the portion of the calendar year prior to such participation.

        Section 6.13     Employment Agreement.    Company agrees to cooperate with Parent in its efforts to negotiate employment or other agreements with key employees identified by Parent between the date hereof and the Effective Time.

        Section 6.14     Transfer Taxes.    Company and Parent shall cooperate in the preparation, execution, and filing of all returns, questionnaires, applications or other documents regarding any real property transfer or gains, sales, use, transfer, value added, stock transfer and stamp taxes, any transfer, recording, registration and other fees and similar taxes which become payable in connection with the transactions contemplated by this Agreement (together with any related interest, penalties or additions to tax, the "Transfer Taxes"). All Transfer Taxes shall be paid by Company and expressly shall not be a liability of any holder of Company Common Stock.

        Section 6.15     Forman Restructuring.    Parent shall use its best efforts to cause its shareholders to contribute or otherwise transfer to the Parent all of the capital stock of Forman they own, beneficially or of record, so that Forman shall become a direct subsidiary of Parent (the "Restructuring"). Parent shall promptly notify Company that the Restructuring has been completed.

        Section 6.16     Pontotoc Gathering Restructuring.    Company shall use its best efforts to acquire the 55% ownership interest in Pontotoc Holdings, Inc. which Company does not already own, for a consideration consisting solely of an aggregate of 110,000 shares of Company Common Stock. Company shall consummate this acquisition prior to the closing of the Offer.

        Section 6.17.     Financing.    Parent shall use its reasonable best efforts to obtain the financing described in Section 4 of Annex I hereto; provided, however, that if Parent or Merger Sub has the right to terminate this Agreement for any reason pursuant to Section 8.1 hereof (other than solely as a result of the condition set forth in Section 4 of Annex I hereto), the obligation of Parent expressed in this Section 6.17 shall be null and void and no remedy shall be available for a breach thereof; and further, provided, that the liquidated damages payable pursuant to Section 4 of Annex I hereto shall not be payable if Company pursues any other remedy with respect to a breach of this Section 6.17.

        Section 6.18.     Hedging Program.    Company shall secure hedging arrangements with respect to up to 50% of Company's oil and gas production for a period of up to two years to the extent approved by Parent at anytime after the date of execution of the Agreement and prior to the consummation of the Offer.

ARTICLE VII.
CONDITIONS TO THE MERGER

        Section 7.1     Conditions to Obligations of Each Party to Effect the Merger.    The obligations of Company, Parent and Merger Sub to consummate the Merger are subject to the satisfaction or waiver of the following conditions:

        (a)     if required by Nevada Law, this Agreement shall have been approved and adopted by the stockholders of Company;

        (b)     the conditions to the Offer shall have been satisfied or waived by Merger Sub and Merger Sub shall have accepted for exchange and exchanged all of the Shares tendered pursuant to the Offer;

        (c)     no provision of any applicable law or regulation and no judgment, injunction, order or decree shall prohibit the consummation of the Merger; and

        (d)     the Registration Statement or the Post–Effective Amendment, as the case may be, shall have been declared effective and no stop order suspending effectiveness shall be in effect and no proceedings for such purpose shall be pending before or threatened by the SEC.

ARTICLE VIII.
TERMINATION, AMENDMENT AND WAIVER

        Section 8.1 Termination.    This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time (notwithstanding any approval of this Agreement by the stockholders of Company):

        (a)    by mutual written agreement of Company and Parent; or

        (b)    by either Company or Parent, if:

        (i) the Offer shall have expired or been terminated in accordance with the terms of this Agreement without Parent or Merger Sub having accepted for exchange any Shares pursuant to the Offer; provided, that Parent and Merger Sub shall not be permitted to terminate this Agreement pursuant to this Section 8.1(b)(i) if the Offer is terminated or expires without Shares having been accepted for exchange as a result of a breach by Parent or Merger Sub of this Agreement; or

        (ii) the Offer has not been consummated on or before May 31, 2001 (the "End Date"); provided, however, that the right to terminate this Agreement under this Section 8.1(b)(ii) shall not be available to any party whose failure to fulfill any obligation under this Agreement has been the principal cause of or resulted in the failure of the Offer to have been consummated on or before such date and such action or failure to act constitutes a material breach of this Agreement; or

         (iii) there shall be any applicable law or regulation that makes consummation of the Merger illegal or otherwise prohibited or any judgment, injunction, order or decree of any court or Governmental Entity having competent jurisdiction enjoining Company or Parent from consummating the Merger is entered and such judgment, injunction, judgment or order shall have become final and nonappealable; or

         (iv)     (A) any representation or warranty of the other party contained in this Agreement shall be or have become inaccurate such that, in the aggregate, such inaccuracies would reasonably be expected to have a Material Adverse Effect on such other party, or (B) the other party fails to perform any material covenant contained in this Agreement; provided, however, that such inaccuracy or failure to perform has not been or is incapable of being cured by such other party within 30 days following receipt by the terminating party of notice of such inaccuracy or failure to perform; or

         (c)     by Parent if a Triggering Event shall have occurred.

        For purposes of this Agreement, a "Triggering Event" shall be deemed to have occurred if, prior to the Effective Time: (i) the Board of Directors of Company or any committee thereof shall have approved or recommended to Company stockholders any Acquisition Proposal; (ii) the Board of Directors of Company or any committee thereof shall for any reason have withdrawn or shall have amended or modified, or proposed or resolved to do so, its Recommendations in a manner adverse to Parent; (iii) Company shall have failed to include in the Offer Documents, the Schedule 14D–9 or the Post–Effective Amendment the Recommendations; or (iv) a tender or exchange offer relating to 30% or more of the Shares shall have been commenced by a person unaffiliated with Parent, and Company shall not have sent to its security holders pursuant to Rule 14e–2 promulgated under the Securities Act, within 10 business days after such tender or exchange offer is first published sent or given, a statement disclosing that Company recommends rejection of such tender or exchange offer.

         The party desiring to terminate this Agreement pursuant to this Section 8.1 (other than pursuant to Section 8.1(a)) shall give notice of such termination to the other party.

         Section 8.2     Notice of Termination; Effect of Termination.    Any proper termination of this Agreement under Section 8.1 will be effective immediately upon the delivery of written notice of the terminating party to the other parties hereto. In the event of the termination of this Agreement under Section 8.1, this Agreement shall be of no further force or effect without liability of any party (or any stockholder, director, officer, employee, agent, consultant or representative of such party) to the other parties hereto, except (i) as set forth in Section 6.6, this Section 8.2, Section 8.3, Article IX, and Section 4 of Annex I hereto, each of which shall survive the termination of this Agreement, and (ii) that nothing herein shall relieve any party from liability for any willful breach of this Agreement. In the event that Company gives Parent notice of an inaccuracy or failure to perform such that this Agreement would be subject to termination pursuant to Section 8.1(b)(iv), Parent shall cause Merger Sub to not consummate the Offer until such inaccuracy or failure to perform is cured.

         Section 8.3 Fees and Expenses.    (a) General. Except as set forth in this Section 8.3, all fees and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses whether or not the Merger is consummated; provided, however, that Parent shall bear and pay all fees and expenses, other than attorneys' and accountants fees and expenses, incurred in relation to the printing and filing with the SEC of the Registration Statement (including financial statements and exhibits) and any amendments or supplements thereto.

         (b)     Company Payments.     If this Agreement is terminated prior to the closing of the Offer: (i) by Parent pursuant to Section 8.1(b)(iv) based upon a material willful breach by Company of this Agreement, or (ii) by Parent or Company, as applicable, prior to the Effective Time pursuant to Section 8.1(b)(i) or (ii) or Section 8.1(c) (in the case of a termination pursuant to Section 8.1(b)(i) or (ii), other than (A) a termination by Company as a result of a breach by Parent or Merger Sub of any of its representations, warranties or obligations under this Agreement; (B) a termination by Company as a result of the failure of Parent or Merger Sub to fulfill any obligation under this Agreement, which obligation is primarily within Parent's or Merger Sub's control, and such failure is the principal cause of or results in the failure of the Offer to be consummated; or (C) a termination by either Company or Parent as a result of the occurrence of any of the matters set forth in Section 3(a) or 3(b) of Annex I, unless such matter occurs as a result of an action, suit or proceeding in which a third party that has made an Acquisition Proposal is a participant or which involves issues arising out of an Acquisition Proposal), Company shall promptly, but in any event no later than two days after the date of such termination, pay Parent a fee equal to $3.2 million in immediately available funds (the "Termination Fee"); provided, that, in the case of a termination under Section 8.1(b)(i) or (ii), as qualified above, prior to which no Triggering Event has occurred: (i) such payment shall be made only if (A) following the date of this Agreement and prior to the termination of this Agreement, any Acquisition Proposal shall have been publicly announced or shall have become publicly known and not withdrawn prior to the scheduled expiration date of the Offer, and (B) within 12 months following the termination of this Agreement, a Company Acquisition (as defined below) is consummated, and (ii) such payment shall be made promptly, but in any event no later than two days after the consummation of such Company Acquisition. Company acknowledges that the agreements contained in this Section 8.3(b) are an integral part of the transactions contemplated by this Agreement, and that, without these agreements, Parent would not enter into this Agreement. Accordingly, if Company fails to pay in a timely manner the amount due pursuant to this Section 8.3(b), and, in order to obtain such payment, Parent makes a claim that results in a judgment against Company, Company shall pay to Parent its reasonable costs and expenses (including reasonable attorneys' fees and expenses) in connection with such suit, together with interest on the amount set forth in this Section 8.3(b) at the prime rate of The Chase Manhattan Bank in effect on the date such payment was required to be made. Payment of the amount described in this Section 8.3(b) shall not be in lieu of damages incurred in the event of breach of this Agreement by Company, except for a payment under Section 8.3(b)(i), with respect to which such payment shall be in lieu of damages incurred in the event of breach of this Agreement by Company.

         For the purposes of this Agreement, "Company Acquisition" shall mean any of the following transactions (other than the transactions contemplated by this Agreement): (i) a sale or other disposition by Company of a business or assets representing 40% or more of the consolidated net revenues, net income or assets of Company immediately prior to such sale; (ii) the acquisition by any person or group (including by way of a tender offer or an exchange offer or issuance by Company), directly or indirectly, of beneficial ownership or a right to acquire beneficial ownership of shares representing 40% or more of any class of equity securities of Company; or (iii) a merger, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction involving Company (other than a transaction in which Company is the acquiror and in which the current Company stockholders retain more than 70%, directly or indirectly, of the surviving or successor corporation); it being understood that a widely distributed offering of Company Common Stock shall not constitute a Company Acquisition.

         Section 8.4     Amendment.    Subject to applicable law, this Agreement may be amended by the parties hereto at any time by execution of an instrument in writing signed on behalf of each of Parent and Company.

         Section 8.5     Extension; Waiver.    At any time prior to the Effective Time any party hereto may, to the extent legally allowed: (i) extend the time for the performance of any of the obligations or other acts of the other parties hereto, (ii) waive any inaccuracies in the representations and warranties made to such party contained herein or in any document delivered pursuant hereto and (iii) waive compliance with any of the agreements or conditions for the benefit of such party contained herein. Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. Delay in exercising any right under this Agreement shall not constitute a waiver of such right.

ARTICLE IX.
GENERAL PROVISIONS 

        Section 9.1     Non–Survival of Representations and Warranties.    The representations and warranties of Company, Parent and Merger Sub contained in this Agreement shall terminate at the Effective Time, and only the covenants that by their terms survive the Effective Time shall survive the Effective Time.

         Section 9.2     Notices.    All notices, requests, demands, claims and other communications required or permitted to be given hereunder shall be in writing and shall be given by (i) personal delivery (effective upon delivery), (ii) recognized overnight delivery service (effective on the next day after delivery to the service), (iii) facsimile (effective on the next day after transmission), or (iv) registered or certified mail, return receipt requested, and postage prepaid (effective on the third day after being so mailed), in each case addressed to the intended recipient as set forth below (or at such other address or facsimile numbers for a party as shall be specified by like notice):

         (a)       if to Parent or Merger Sub, to:

Ascent Energy Inc.
c/o Jones, Walker, Waechter, Poitevent, Carrere & Denegre, L.L.P.
201 St. Charles Avenue
Suite 5100
New Orleans, Louisiana 70170–5100
Attention: William B. Masters
Facsimile No.: (504) 582–8380

        (b)       if to Company, to:

Pontotoc Production, Inc.
808 East Main
Ada, Oklahoma 74820
Attention: Robby Robson
Facsimile No.: (580) 332–6486

 with a copy to:

Conner & Winters
3700 First Place Tower
15 East 5^th Street
Tulsa, Oklahoma 74103–4344
Attention: Robert A. Curry
Facsimile No.: (918) 586–8548

        Section 9.3     Interpretation; Certain Defined Terms.    (a) When a reference is made in this Agreement to an Annex or an Exhibit, such reference shall be to an Annex or an Exhibit to this Agreement unless otherwise indicated. When a reference is made in this Agreement to Sections, such reference shall be to a Section of this Agreement unless otherwise indicated. The words "include," "includes" and "including" when used herein shall be deemed in each case to be followed by the words "without limitation." The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. When reference is made herein to "the business of" an entity, such reference shall be deemed to include the business of all direct and indirect subsidiaries of such entity. Reference to the subsidiaries of an entity shall be deemed to include all direct and indirect subsidiaries of such entity.

        (b)    For purposes of this Agreement, the term "Material Adverse Effect" when used in connection with an entity means any change, event, circumstance or effect that is or is reasonably likely to be materially adverse to the business, assets (including intangible assets), capitalization, financial condition, operations, results of operations or prospects of such entity taken as a whole with its subsidiaries, including any such change or effect that prevents Parent or Merger Sub from obtaining their contemplated financing for the Offer and the Merger, except to the extent that any such change, event, circumstance or effect results from (i) changes in general economic conditions, (ii) changes affecting the industry generally in which such entity operates (provided that such changes do not affect such entity in a substantially disproportionate manner) and (iii) changes that are attributable to the announcement or pendency of or compliance with this Agreement or the transactions contemplated hereby or to actions taken by Company that are jointly agreed between Company and Parent.

         (c)    For purposes of this Agreement, the term "person" shall mean any individual, corporation (including any non–profit corporation), general partnership, limited partnership, limited liability partnership, joint venture, estate, trust, company (including any limited liability company or joint stock company), firm or other enterprise, association, organization, entity or Governmental Entity.

        (d)    For purposes of this Agreement, "subsidiary" of a specified entity will be any corporation, partnership, limited liability company, joint venture or other legal entity of which the specified entity (either alone or through or together with any other subsidiary) owns, directly or indirectly, 45% or more of the stock or other equity or partnership interests the holders of which are generally entitled to vote for the election of the Board of Directors or other governing body of such corporation or other legal entity.

        (e)    For purposes of this Agreement, the term "affiliate" means a person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the first mentioned person.

        Section 9.4     Counterparts.    This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party, it being understood that all parties need not sign the same counterpart. Signatures of a party to this Agreement or other documents executed in connection herewith which are sent to the other parties by facsimile transmission shall be binding as evidence of acceptance of the terms hereof and thereof by such signatory party, with originals to be circulated to the other parties in due course.

        Section 9.5     Entire Agreement; Third Party Beneficiaries.    This Agreement, its Annexes and Exhibits and the documents and instruments and other agreements among the parties hereto as contemplated by or referred to herein, including the Disclosure Letter, the Parent Disclosure Letter and that certain confidentiality agreement dated August 21, 2000, between Parent and Company, as amended: (a) constitute the entire agreement among the parties with respect to the subject matter hereof and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof, and (b) are not intended to confer upon any other person any rights or remedies hereunder, other than the Continuing Directors, except as specifically provided in Section 6.9.

        Section 9.6    Severability.    In the event that any provision of this Agreement or the application thereof, becomes or is declared by a court of competent jurisdiction to be illegal, void or unenforceable, the remainder of this Agreement will continue in full force and effect and the application of such provision to other persons or circumstances will be interpreted so as reasonably to effect the intent of the parties hereto. The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such void or unenforceable provision.

        Section 9.7     Other Remedies; Specific Performance.    Except as otherwise provided herein, any and all remedies herein expressly conferred upon a party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by law or equity upon such party, and the exercise by a party of any one remedy will not preclude the exercise of any other remedy. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to seek an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any court of the United States or any state having jurisdiction, this being in addition to any other remedy to which they are entitled at law or in equity.

        Section 9.8     Governing Law.    Except to the extent the subject matter of this Agreement is subject to the statutory law of the State of Nevada which requires that such laws shall govern, this Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, regardless of the laws that might otherwise govern under applicable principles of conflicts of law thereof.

         Section 9.9     Rules of Construction.    The parties hereto agree that they have been represented by counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.

        Section 9.10     Assignment.    No party may assign either this Agreement or any of its rights, interests, or obligations hereunder, by operation of law or otherwise, without the prior written consent of the other parties hereto. Subject to the preceding sentence, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. Any purported assignment in violation of this Section 9.10 shall be void.

        Section 9.11     Waiver of Jury Trial.    EACH OF PARENT, COMPANY AND MERGER SUB HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF PARENT, COMPANY OR MERGER SUB IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.

* * * * *

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement and Plan of Merger to be executed by their duly authorized respective officers as of the date first written above.

ASCENT ENERGY INC.

By:                      /s/ Jeffrey Clarke                     

Jeff Clarke
President

PONTOTOC ACQUISITION CORP.

By:                       /s/ Jeffrey Clarke                    

Jeff Clarke
President

PONTOTOC PRODUCTION, INC.

By:                     /s/ James Robson, Jr.               

James Robson, Jr.
President

ANNEX I

CONDITIONS TO THE OFFER

        The capitalized terms used but not defined in this Annex I shall have the meanings set forth in the Agreement to which this Annex I is annexed (the "Agreement").

        Notwithstanding any other provision of the Offer and subject to the terms of this Agreement, Merger Sub shall not be required to accept for payment or pay for (subject to any applicable rules and regulations of the SEC, including Rule 14e–1(c) under the Exchange Act (relating to Merger Sub's obligation to pay for or return tendered Shares after the termination or withdrawal of the Offer)) any Shares tendered, and may terminate or amend the Offer in accordance with the Agreement, if by the expiration of the Offer (as it may be extended in accordance with the requirements of Section 1.1 of the Agreement):

(1)	the Minimum Condition shall not have been satisfied;
(2)	the Registration Statement shall not have become effective, a stop order suspending the effectiveness of the Registration Statement shall have been issued by the SEC or if proceedings for that purpose shall have been initiated by the SEC and not concluded or withdrawn or all state securities or Blue Sky authorizations necessary to consummate the Offer shall not have been obtained;
(3)	at any time on or after the date of the Agreement and at or before the time of payment for any such Shares (whether or not any Shares have theretofore been accepted for payment or paid for pursuant to the Offer) any of the following shall occur:

(a)	there shall be instituted or pending any action or proceeding by any government or governmental authority or agency, domestic, foreign or supranational, before any court or governmental authority or agency, domestic, foreign or supranational challenging or seeking to make illegal, to delay materially or otherwise directly or indirectly to restrain or prohibit the making of the Offer, the acceptance for payment of or payment for some or all of the Shares by Parent or Merger Sub or the consummation of the Merger; or
(b)	a judgment, order, decree, statute, law, ordinance, rule or regulation, entered, enacted, promulgated, enforced or issued by any court, government or governmental authority or agency, domestic, foreign or supranational or any other legal restraint or prohibition preventing the consummation of the Offer or making the Offer illegal shall be in effect; or
(c)	Company shall have failed to perform in any material respect any of its covenants, obligations or agreements under this Agreement such that the aggregate of all such breaches would reasonably be expected to have a Material Adverse Effect on Company; or
(d)	the representations and warranties of Company contained in the Agreement, disregarding all qualifications and exceptions contained therein relating to materiality or Material Adverse Effect or any similar standard or qualification, shall be true at and as of the expiration of the Offer as if made at and as of such time (other than representations or warranties that address matters only as of a certain date, which shall be true and correct as of such date), with such exceptions as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Company; or
(e)	the Merger Agreement shall have been terminated in accordance with its terms; or

(4)	Parent shall not have obtained the financing contemplated by the commitment letter between Parent and its lender dated as of January 10, 2001; provided, however, that Parent hereby agrees to pay to Company within five days after the termination of this Agreement, as liquidated damages and not as a penalty, the aggregate amount of $2,000,000, in immediately available funds, if the reason for such termination is the failure of the condition set forth in this Section 4 to be satisfied and all other conditions to the Offer have been satisfied; or
(5)	Company's total proved reserves are less than 11.8 MMBoe (million barrels of oil equivalent, with 6 Mcf (thousand cubic feet) of gas being deemed to be a barrel of oil), Company's total proved reserves behind pipe are less than 2.2 MMBoe or Company's total proved developed producing reserves are less than 4.8 MMBoe, in each case as reflected in the reserve report as of March 1, 2001, to be prepared by Netherland, Sewell & Associates, Inc. prior to the consummation of the Offer on behalf of (and at the sole cost of) Parent regarding the Oil and Gas Interests of Company and its subsidiaries in accordance with SEC guidelines; or
(6)	The amount of debt outstanding under the Company's credit facility (net of cash, cash equivalents and amounts used to satisfy margin requirements) immediately prior to the consummation of the Offer is greater than $6.8 million.

        The foregoing conditions are for the sole benefit of Parent and Merger Sub and may, subject to the terms of the Merger Agreement, be waived by Parent and Merger Sub in their sole discretion in whole at any time or in part from time to time. The failure by Parent or Merger Sub at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time.

EXHIBIT A

CERTIFICATE OF DESIGNATIONS 

of

 8% SERIES B CONVERTIBLE PREFERRED STOCK

of

ASCENT ENERGY INC.

(Pursuant to Section 151(g) of the
Delaware General Corporation Law)

         Ascent Energy Inc., a corporation organized and existing under the laws of the State of Delaware (the "Company"), hereby certifies that the following resolution was duly adopted at a meeting of the board of directors of the Company (the "Board of Directors") held on _______, 2001, pursuant to Section 151(g) of the Delaware General Corporation Law:

         RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors in accordance with the provisions of the Certificate of Incorporation of the Company, the Board of Directors hereby creates a series of Preferred Stock, par value $0.001 per share, of the Company and hereby states the designation and number of shares, and fixes the relative rights, preferences and limitations thereof as follows:

        Section 1.    Designation and Amount.     The shares of this series of Preferred Stock shall be designated as "8% Series B Convertible Preferred Stock" (the "Series B Convertible Preferred Stock") and the number of shares constituting the Series B Convertible Preferred Stock shall be ____________. Such number of shares may be increased or decreased at any time by resolution of the Board of Directors; provided, however, no decrease shall reduce the number of shares of Series B Convertible Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights, or warrants for, or upon the conversion or exchange of, any outstanding securities issued by the Company convertible or exchangeable into, Series B Convertible Preferred Stock.

         Section 2.     Ranking.    The Series B Convertible Preferred Stock shall rank, as to the payment of dividends and the distribution of the assets upon liquidation, dissolution or winding up of the Company: (a) on a parity with the Company's Series A Preferred Stock, par value $0.001 per share (the "Series A Preferred Stock") and the Company's Series C Convertible Preferred Stock, par value $0.001 per share (the "Series C Convertible Preferred Stock"), (b) senior to or on a parity with all other classes and series of the Company's preferred stock, and (c) senior to the Company's common stock, par value $0.001 per share ("Common Stock").

         Section 3.     Liquidation.    Upon the voluntary or involuntary liquidation, winding up or dissolution of the Company (in connection with the bankruptcy or insolvency of the Company or otherwise), out of the assets available for distribution to shareholders, the holders of Series B Convertible Preferred Stock shall be entitled to receive, in preference to any payment or distribution to the holders of Common Stock or any other stock of the Company ranking junior to the Series B Convertible Preferred Stock, as to dividends, liquidation, dissolution or winding up, $2.50 per share (the "Preferred Liquidation Value") plus an amount equal to all Preferred Dividends (as defined in Section 4 below) (whether or not earned or declared) accrued and unpaid on each such share up to and including the date of final distribution to such holders. After the Preferred Liquidation Value and all accrued and unpaid Preferred Dividends have been paid on the Series B Convertible Preferred Stock, the remaining assets shall be paid to the holders of Common Stock and other junior classes of stock in accordance with their respective priority, if any. In the event the net assets of the Company are insufficient to pay the holders of the Series B Convertible Preferred Stock the full amount of their preference set forth above and the holders of any other series of capital stock of the Company ranking on a parity with the Series B Convertible Preferred Stock the liquidating payments to which they are entitled, then the remaining net assets of the Company shall be divided among and paid to the holders of the shares of Series B Convertible Preferred Stock and any such other capital stock of the Company ranking on a parity with the Series B Convertible Preferred Stock ratably per share in proportion to the full per share amounts to which they would be entitled if all amounts payable thereon were paid in full, and the holders of Common Stock and other junior classes of stock will receive nothing. Neither a merger or consolidation of the Company with or into any other corporation or entity nor the sale of all or substantially all of the assets of the Company shall be deemed to be a liquidation, dissolution or winding up within the meaning of this provision.

         Section 4.     Dividends.     The Series B Convertible Preferred Stock is entitled to receive, out of legally available funds, preferential cumulative dividends from the issuance date thereof at the annual rate of eight percent (8%) of the Preferred Liquidation Value per share ("Preferred Dividends"). All Preferred Dividends, if declared by the Board of Directors, shall be payable quarterly and promptly after the first business day of each _______, ________, ________ and _________ of each year (each, a "Dividend Payment Date"), commencing on ________, 2001, to holders of record on the record date, which the Board of Directors shall fix not more than sixty (60) days or less than ten (10) days preceding a Dividend Payment Date. Preferred Dividends shall cease to accrue on shares of Series B Convertible Preferred Stock on the Mandatory Conversion Date (as defined in Section 5 below) or on the date of their earlier conversion. No dividend shall be declared on any other series or class or classes of stock to which the Series B Convertible Preferred Stock ranks prior as to dividends or liquidation, in respect of any period, nor shall any shares of any such series or class be redeemed, purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series B Convertible Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. No dividend shall be declared on any other series or class or classes of stock ranking on a parity with the Series B Convertible Preferred Stock, as to dividends, in respect of any quarterly period, nor shall any shares of any such series or class be redeemed or purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series B Convertible Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. Preferred Dividends shall also be payable upon any Redemption Date (as defined in Section 7(a) below) and upon the final distribution date relating to the dissolution, liquidation or winding up of the Company. Preferred Dividends shall begin to accrue on outstanding shares of Series B Convertible Preferred Stock and to accumulate from the issuance date of such shares whether or not earned or declared, but Preferred Dividends for any period less than a full quarterly period between Dividend Payment Dates shall be computed on the basis of a 365–day year for the actual number of days elapsed. Preferred Dividends shall accrue whether or not there shall be (at the time any such dividend becomes payable or at any other time) profits, surplus or other funds of the Company legally available for the payment of dividends. Accumulations of dividends on shares of Series B Convertible Preferred Stock shall not bear interest.

         Section 5.     Conversion Rights.

                    (a)    Unless previously converted at the option of the holder into Common Stock in accordance with the provisions of Section 5(c) below, on ___________, 2003 (the "Mandatory Conversion Date"), each outstanding share of Class B Convertible Preferred Stock will convert automatically (the "Mandatory Conversion") into a number of shares of Common Stock at the Conversion Rate (as defined below) in effect on the Mandatory Conversion Date and the holder thereof shall have the right to receive an amount in cash equal to all accrued and unpaid Preferred Dividends (whether or not earned or declared) on such share of Series B Convertible Preferred Stock (other than previously declared Preferred Dividends payable to a holder of record as of a prior date) to and including the Mandatory Conversion Date, whether or not declared, out of funds legally available for the payment of Preferred Dividends. The "Conversion Rate" is initially equal to ________ shares of Common Stock per share of Series B Convertible Preferred Stock. [N.B.: This rate will be set at a rate that will result in the issuance of an aggregate number of shares of Common Stock equal to 10% of Ascent's outstanding shares of Common Stock on the date of issuance of the Series B Convertible Preferred Stock, on a fully diluted basis (including the assumed (i) conversion of all shares of the Series C Convertible Preferred Stock, if any such shares are outstanding, and (ii) exercise of all warrants to purchase Common Stock, if any such warrants are outstanding).] The Conversion Rate is subject to adjustment as set forth in Section 5(e).

                    (b)    Preferred Dividends on the shares of Series B Convertible Preferred Stock shall cease to accrue and such shares of Series B Convertible Preferred Stock shall cease to be outstanding on the Mandatory Conversion Date. The Company shall make such arrangements as it deems appropriate for the issuance of certificates representing shares of Common Stock and for the payment of cash in respect of accrued and unpaid Preferred Dividends on the Series B Convertible Preferred Stock, if any, in exchange for and contingent upon surrender of certificates representing the shares of Series B Convertible Preferred Stock, and the Company may defer the payment of dividends on such shares of Common Stock until, and make such payment contingent upon, the surrender of certificates representing the shares of Series B Convertible Preferred Stock; provided, that the Company shall give the holders of the shares of Series B Convertible Preferred Stock such notice of any such actions as the Company deems appropriate and upon such surrender such holders shall be entitled to receive such dividends declared and paid, if any, without interest, on such shares of Common Stock subsequent to the Mandatory Conversion Date.

                    (c)    Each share of Series B Convertible Preferred Stock is convertible, in whole or in part, at the option of the holder thereof ("Optional Conversion"), at any time prior to the Mandatory Conversion Date, into duly authorized, validly issued, fully paid and nonassessable shares of Common Stock at the Conversion Rate in effect on the date of conversion. Optional Conversion of shares of Series B Convertible Preferred Stock may be effected by delivering certificates evidencing such shares, together with written notice of conversion and proper assignment of such certificates to the Company or in blank to the office of any transfer agent for the shares of Series B Convertible Preferred Stock or to any other office or agency maintained by the Company for that purpose (the "Transfer Agent") and otherwise in accordance with reasonable Optional Conversion procedures established by the Company.

                 (d)    Holders of shares of Series B Convertible Preferred Stock at the close of business on a record date for any payment of declared Preferred Dividends shall be entitled to receive the Preferred Dividends so declared on such shares of Series B Convertible Preferred Stock on the corresponding Dividend Payment Date notwithstanding the Optional Conversion of such shares of Series B Convertible Preferred Stock following such record date and prior to such Dividend Payment Date. Except as provided above, upon any Optional Conversion of shares of Series B Convertible Preferred Stock, the Company shall make no payment of or allowance for unpaid Preferred Dividends, whether or not in arrears, on such shares of Series B Convertible Preferred Stock as to which Optional Conversion has been effected or previously declared dividends or distributions on the shares of Common Stock issued upon such Optional Conversion. As promptly as practicable after the surrender of the Series B Convertible Preferred Stock, the Company shall issue and deliver to such holder certificates for the number of shares of Common Stock issuable upon the conversion of such shares in accordance with the provisions hereof.

                 (e)     Adjustments to Conversion Rate.     The Conversion Rate in effect from time to time for the Series B Convertible Preferred Stock shall be subject to adjustment in certain cases as follows:

            (i)     Adjustments for Subdivisions, Combinations or Consolidation of Common Stock.     In the event the outstanding shares of Common Stock shall be subdivided, by stock dividend, stock split or otherwise, into a greater number of shares of Common Stock, the Conversion Rate applicable to the Series B Convertible Preferred Stock then in effect shall, concurrently with the effectiveness of such subdivision, be proportionately increased. In the event the outstanding shares of Common Stock shall be combined or consolidated, by reclassification or otherwise, into a lesser number of shares of Common Stock, the Conversion Rate applicable to the Series B Convertible Preferred Stock then in effect shall, concurrently with the effectiveness of such combination or consolidation, be proportionately decreased.

        (ii)     Adjustments for Reclassification, Exchange and Substitution.     If the Common Stock issuable upon conversion of the Series B Convertible Preferred Stock shall be changed into the same or a different number of shares of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision, combination or consolidation of shares provided for in Section 5(e)(i) above), the Conversion Rate then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted such that the Series B Convertible Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders would otherwise have been entitled to receive, a number of shares of such other class or classes of stock equivalent to the number of shares of Common Stock that would have been subject to receipt by the holders upon conversion of the Series B Convertible Preferred Stock immediately before that change, subject to further adjustment as provided in this Section 5.

         (iii)     Before taking any action that would cause an adjustment reducing the Conversion Rate below the then par value of the shares of Common Stock deliverable upon conversion of the shares of Series B Convertible Preferred Stock, the Company will take any corporate action which may be necessary in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock at such adjusted Conversion Rate.

                 (f)     Certificate as to Adjustments.     Upon the occurrence of each adjustment or readjustment of the Conversion Rate pursuant to this Section 5, the Company, at its expense, shall promptly compute such adjustment or readjustment in accordance with the terms hereof and deliver to the Transfer Agent a certificate setting forth such adjustment or readjustment and setting forth a brief statement of the facts requiring such adjustment or readjustment. Promptly after delivery of such certificate, the Company shall prepare and mail a notice to each holder of Series B Convertible Preferred Stock at such holder's last address as it appears on the transfer books of the Company, which notice shall set forth the new Conversion Rate and a brief statement of the facts requiring the adjustment or readjustment, including the computation of the new Conversion Rate.

                 (g)     Fractional Shares.     No fractional shares of Common Stock shall be issued upon conversion of the Series B Convertible Preferred Stock, and the number of shares of Common Stock to be issued shall be rounded up to the nearest whole share. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series B Convertible Preferred Stock by a holder thereof shall be aggregated for purposes of determining whether the conversion would result in the issuance of any fractional share.

                 (h)     No Impairment.     The Company will not, by amendment of its Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company but will at all times in good faith assist in the carrying out of all the provisions of this Section 5 and take all such action as may be necessary or appropriate in order to protect the conversion rights of the holders of the Series B Convertible Preferred Stock against impairment.

                 (i)     Reservation of Common Stock Issuable upon Conversion.     The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock solely for issuance upon the conversion of shares of Series B Convertible Preferred Stock as herein provided, such number of shares of Common Stock as, from time to time, shall be issuable upon the conversion of all the shares of the Series B Convertible Preferred Stock at the time outstanding. All shares of Common Stock issuable upon the conversion of shares of the Series B Convertible Preferred Stock shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable.

                 (j)     Fundamental Change Transaction.     In case at any time after the original issuance of shares of Series B Convertible Preferred Stock, the Company shall be a party to any transaction (including a merger, consolidation, statutory share exchange, sale of all or substantially all of the Company's assets or recapitalization of the Common Stock), in each case as a result of which shares of Common Stock (or any other securities of the Company then issuable upon conversion of the Series B Convertible Preferred Stock) shall be converted into the right to receive stock, securities or other property (including cash or any combination thereof) (each of the foregoing transactions being referred to as a "Fundamental Change Transaction"), then, lawful and fair provision shall be made whereby the shares of Series B Convertible Preferred Stock shall, immediately prior to the consummation of the Fundamental Change Transaction, convert and the holders of such shares of Series B Convertible Preferred Stock shall have the right to receive, upon the basis and upon the terms and conditions specified in connection with such Fundamental Change Transaction and in lieu of the shares of Common Stock receivable upon the conversion of such shares, such shares of stock, securities or other property (including cash or any combination thereof) as may be issued or payable with respect to or in exchange for the number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore receivable upon the conversion of shares of Series B Convertible Preferred Stock, had such Fundamental Change Transaction not taken place, plus the cash payment described in Section 5(a) hereof. The Company shall not effect any Fundamental Change Transaction unless prior to the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation or merger, or the corporation purchasing such assets, shall assume by written instrument the obligation to deliver to the holders of Series B Convertible Preferred Stock such shares of stock, securities, or assets as such holder would be entitled to acquire in accordance with the foregoing provisions. In the event that, at any time, as a result of an adjustment made pursuant to other provisions of this Section 5, the Series B Convertible Preferred Stock shall become subject to conversion into any securities other than shares of Common Stock, thereafter the number of such other securities so issuable upon conversion of the shares of Series B Convertible Preferred Stock shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the shares of Series B Convertible Preferred Stock contained in this Section 5(j).

                 (k)     Notices.     In case at any time:

                (i)     the Company shall declare or pay to all holders of Common Stock any dividend (whether payable in Common Stock, cash, securities or other property);

                (ii)     there shall be any capital reorganization, or reclassification of the Common Stock of the Company, or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation or other entity;

              (iii)      there shall be a voluntary or involuntary dissolution, liquidation or winding–up of the Company;

               (iv)     there shall be any other Fundamental Change Transaction; or

                (v)     there shall occur any other event that would cause an adjustment to the Conversion Rate of the Series B Convertible Preferred Stock;

then, in any one or more of such cases, the Company shall give to each holder of shares of Series B Convertible Preferred Stock: (A) at least twenty (20) days prior to any such event, written notice of the date on which the books of the Company shall close or records shall be taken for such dividend or distribution or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction; and (B) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction known to the Company, at least thirty (30) days prior written notice of the date (or if not then known, a reasonable approximation thereof by the Company) when the same shall take place. Such notice in accordance with the foregoing clause (A) shall also specify, in the case of any such dividend or distribution, the date on which such holders of Common Stock shall be entitled thereto. Such notice in accordance with the foregoing clause (B) shall also specify the date on which such holders of Common Stock shall be entitled to receive their shares of stock, securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction, as the case may be.

                 (l)    Initial Public Offering.     In case at any time after the original issuance of shares of Series B Convertible Preferred Stock, the Company shall consummate an Initial Public Offering (as defined below), the shares of Series B Convertible Preferred Stock shall immediately prior to the consummation of the Initial Public Offering convert in accordance with the terms set forth in Sections 5(a) and (b) hereof. The Company shall provide each holder of shares of Series B Convertible Preferred Stock with reasonable notice of such Initial Public Offering and the arrangements made pursuant to Section 5(b) hereof. For purposes hereof, an "Initial Public Offering" shall mean a firm commitment, underwritten public offering of Common Stock of the Company registered under the Securities Act of 1933, as amended (the "Securities Act"), other than a registration relating solely to a transaction under Rule 145 promulgated under the Securities Act or to an employee benefit plan of the Company, that results in such Common Stock being listed on the New York Stock Exchange, the American Stock Exchange or quoted for trading on the Nasdaq National Market tier of the Nasdaq Stock Market or any of their respective successors.

         Section 6.     Voting Rights.

                 (a)     Except as set forth below or as otherwise provided by Delaware law, holders of shares of Series B Convertible Preferred Stock shall not be entitled to vote such shares; provided, that in all cases where the holders of shares of Series B Convertible Preferred Stock have the right to vote such shares, such holders shall be entitled to one vote for each such share held by them.

                  (b)     Without the affirmative vote of the holders of not less than a majority of the shares of Series B Convertible Preferred Stock outstanding, voting together as a single class, the Company shall not amend or waive any of the provisions of the Certificate of Incorporation or this Certificate of Designations, which would materially and adversely affect any right, preference or privilege of the Series B Convertible Preferred Stock or of the holders thereof; provided, however, that any increase in the amount of authorized Preferred Stock or the creation and/or issuance of other series of Preferred Stock, in each case ranking on a parity with or junior to the Series B Convertible Preferred Stock, shall not be deemed to materially and adversely affect such rights, preferences or privileges and shall not require the consent of the holders of the then outstanding Series B Convertible Preferred Stock; and provided further, that the authorization and/or issuance of additional shares of Series B Convertible Preferred Stock and/or the creation and/or issuance of other series or classes of preferred stock ranking prior to the Series B Convertible Preferred Stock shall be deemed to materially and adversely affect such rights, preferences and privileges.

         Section 7.     Redemption.

                 (a)     The Company shall have the right, at any time and from time to time, on and after the date of issuance, and at its sole option and election, to redeem the shares of Series B Convertible Preferred Stock, in whole or in part, on such date as may be specified in a notice of redemption given as provided in Section 7(b) below (any such date a "Redemption Date") at a cash price per share (the "Redemption Price") equal to 100% of the Preferred Liquidation Value plus an amount equal to all Preferred Dividends (whether or not earned or declared) accrued and unpaid on each such share up to and including the date fixed for redemption, in immediately available funds. The Company shall not be required to establish any sinking or retirement fund with respect to the shares of Series B Convertible Preferred Stock.

                 (b)    Notice of any redemption of shares of Series B Convertible Preferred Stock pursuant to Section 7(a) above shall be mailed at least twenty (20) but not more than sixty (60) days prior to the applicable Redemption Date to the Transfer Agent for the shares of Series B Convertible Preferred Stock and each holder of the shares of Series B Convertible Preferred Stock to be redeemed, at such holder's last address as it appears on the transfer books of the Company. Failure to mail such notice, or any defect therein or in the mailing thereof, to any particular holder shall not affect the validity of the proceeding for the redemption of any shares so to be redeemed from any other holder. In order to facilitate the redemption of shares of Series B Convertible Preferred Stock, the Board of Directors may fix a record date for the determination of shares of Series B Convertible Preferred Stock to be redeemed, or may cause the transfer books of the Company for the Series B Convertible Preferred Stock to be closed, not more than sixty (60) days or less than twenty (20) days prior to the applicable Redemption Date.

                  (c)     If less than all the outstanding shares of Series B Convertible Preferred Stock are to be redeemed, the number of shares of Series B Convertible Preferred Stock to be redeemed shall be as determined by the Board of Directors. Any such partial redemption shall be effected on a pro rata basis.

                     (d)    Notice of redemption having been given as provided in Section 7(b) above, notwithstanding that any certificates for such shares shall not have been surrendered for cancellation, from and after the Redemption Date designated in the notice of redemption (i) the shares represented thereby shall no longer be deemed outstanding, (ii) the rights to receive dividends thereon shall cease to accrue and (iii) all rights of the holders of shares of Series B Convertible Preferred Stock to be redeemed shall cease and terminate, excepting only the right to receive the Redemption Price therefor and the right to convert such shares into shares of Common Stock until the close of business on such Redemption Date, in accordance with Section 5 hereof.

                 (e)     Notwithstanding the foregoing, if notice of redemption has been given pursuant to Section 7(b) above and any holder of the Series B Convertible Preferred Stock shall, before the close of business on the business day preceding the Redemption Date, give notice to the Company pursuant to Section 5(c) above of the conversion of any or all of the shares to be redeemed which are held by that holder, then (i) the Company shall not have the right to redeem those shares for which the conversion notice has been given, (ii) the holder shall not be entitled to payment of the Redemption Price with respect to those shares, (iii) the conversion of those shares shall become effective as provided in Section 5 above, and (iv) any funds that have been deposited for the payment of the Redemption Price of those shares shall be returned to the Company immediately after such conversion.

        Section 8.     Reacquired Shares.     Any shares of Series B Convertible Preferred Stock converted, exchanged, redeemed, purchased or otherwise acquired by the Company in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock without designation as to series and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors as permitted by the Certificate of Incorporation or as otherwise permitted under Delaware law.

        Section 9.     Preemptive Rights.     Except as provided herein, the Series B Convertible Preferred Stock is not entitled to any preemptive rights in respect of any securities of the Company.

        Section 10.    Severability of Provisions.     Whenever possible, each provision hereof shall be interpreted in a manner as to be effective and valid under applicable law, but if any provision hereof is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining provisions hereof. If a court of competent jurisdiction should determine that a provision hereof would be valid or enforceable if a period of time were extended or shortened or a particular percentage were increased or decreased, then such court may make such change as shall be necessary to render the provision in question effective and valid under applicable law.

        Section 11.     Replacement.     Upon receipt of evidence satisfactory to the Company (an affidavit of the registered holder shall be satisfactory) of the ownership and the loss, theft, destruction or mutilation of any certificate evidencing shares of Series B Convertible Preferred Stock, and, in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company (provided, that, if the holder is a financial institution or other institutional investor, its own agreement shall be satisfactory), or, in the case of any such mutilation, upon surrender of such certificate, the Company shall execute and deliver in lieu of such certificate a new certificate of like kind representing the number of shares of Series B Convertible Preferred Stock of such class represented by such lost, stolen, destroyed or mutilated certificate and dated the date of the lost, stolen, destroyed or mutilated certificate, and dividends shall accrue on the Series B Convertible Preferred Stock represented by such new certificate from the date to which dividends have been fully paid on the Series B Convertible Preferred Stock represented by the lost, stolen, destroyed or mutilated certificate.

        Section 12.     Successors and Transferees.     The provisions applicable to shares of Series B Convertible Preferred Stock shall bind and inure to the benefit of and be enforceable by the Company, the respective successors to the Company, and by any record holder of shares of Series B Convertible Preferred Stock.

         IN WITNESS WHEREOF, Ascent Energy Inc. has caused this Certificate of Designations to be signed by the undersigned on this __ day of __________, 2001.

ASCENT ENERGY INC.

By: ______________________________
Name:
Title

EXHIBIT B

STOCKHOLDERS' AGREEMENT

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

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

        NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE 1
VOTING AGREEMENT; AGREEMENT TO TENDER

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

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

ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER

         Each Stockholder, severally and not jointly, represents and warrants to Buyer that:

         Section 2.1.     Authorization.     The execution, delivery and performance by such Stockholder of this Agreement and the consummation by such Stockholder of the transactions contemplated hereby are within the powers of such Stockholder and have been duly authorized by all necessary action. This Agreement constitutes a valid and binding Agreement of such Stockholder.

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

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

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER

         Buyer represents and warrants to each Stockholder:

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

ARTICLE 4
COVENANTS OF STOCKHOLDER

        Each Stockholder hereby covenants and agrees that:

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

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

ARTICLE 5
MISCELLANEOUS

        Section 5.1.     Further Assurances.     Buyer and each Stockholder will each execute and deliver, or cause to be executed and delivered, all further documents and instruments and use all reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations, to consummate and make effective the transactions contemplated by this Agreement.

        Section 5.2.     Amendments; Termination.     Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed, in the case of an amendment, by each party to this Agreement or in the case of a waiver, by the party against whom the waiver is to be effective. This Agreement shall terminate upon the termination of the Merger Agreement in accordance with its terms.

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

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

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

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

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

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

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

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

BUYER:

ASCENT ENERGY INC.

By: __________________________
Name:
Title:

STOCKHOLDERS:	Shares of common stock of the Company owned by the Stockholder:
James "Robby" Robson, Jr.	569,497
Todd Robson	570,051
James Robson, Sr.	441,313
Lyle P. Phillips	299,000
Brian K. Gourley	58,671
Timothy A. Jurck	25,000

Annex B

C. K. COOPER & COMPANY LETTERHEAD

January 19, 2001

Pontotoc Production, INC.
808 E. Main Street
Ada, OK 74820

Attention: Board of Directors:

Dear Sirs:

     You have requested our opinion as to the fairness, from a financial point of view, to the existing holders, as a group, collectively, referred to herein as "Shareholders", of common stock, par value $0.0001 per share ("Common Stock"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"), of the aggregate consideration to be received as set forth in the Agreement and Plan of Merger, dated January 19, 2001 (the "Merger Agreement"), by and among Ascent Energy Inc., a Delaware corporation ("Parent"), Pontotoc Acquisition Corp., a Nevada corporation and a direct wholly–owned subsidiary of Parent ("Merger Sub"), and Pontotoc. Pursuant to the Merger Agreement, the Merger Sub has agreed to commence an exchange offer (the "Offer") to acquire all of the outstanding shares of Pontotoc's Common Stock at a price per share of $9.00 cash, and one share of 8% Series B Convertible Preferred Stock, par value $0.001 per share ("Parent Preferred Stock"), of Parent with a liquidation preference equal to $2.50 per share. The price payable in the Offer for shares of Pontotoc Common Stock is herein referred to as the "Offer Price." The Merger Agreement also provides for the subsequent merger (the "Merger") of the Merger Sub into Pontotoc, pursuant to which each share of Pontotoc Common Stock outstanding at the effective time of the Merger will be converted into the right to receive cash and Parent Preferred Stock equal to the Offer Price. The Offer and the Merger are collectively referred to as the "Transaction." The terms and conditions of the Transaction are set forth more fully in the Merger Agreement.

     In connection with our review of the Transaction, and in arriving at our opinion described below, we have reviewed business and financial information relating to Pontotoc. We have, among other things:

1. reviewed the Merger Agreement and related documents;
   

2. reviewed the Certificate of Designations of the Parent Preferred Stock;
   

3. reviewed the Annual Report on Form 10–KSB for the year ended March 31, 2000 and the Quarterly Reports on Form 10–QSB and related unaudited financial information for certain interim periods, including six months ended September 30, 2000, of Pontotoc;
   

4. reviewed the most recent filed Proxy Statement of Pontotoc;
   

5. reviewed Pontotoc's proved oil and gas reserves and the standardized measure of discounted future net cash flows relating to proved oil and gas reserves as of March 31, 2000, estimated by Fletcher Lewis Engineering, Inc., independent petroleum engineers, and adjusted by Pontotoc management to December 31, 2000;
   

6. discussed with certain members of Pontotoc's senior management regarding their operations, historical financial statements and future prospects;
   

7. reviewed certain operating and financial information of Pontotoc, including projections and operating assumptions, relating to their business and prospects, which was provided to us by Pontotoc;
   

8. reviewed historical market prices and trading volumes for Pontotoc's Common Stock;
   

9. reviewed publicly available financial data and stock market performance data of publicly held companies that we deemed generally comparable to Pontotoc;
   

10. reviewed the financial terms of certain business combinations of comparable exploration and production companies; and
    

11. have conducted other analyses and investigations as we deemed appropriate under the circumstances.

     In connection with our review, we have not independently verified any of the foregoing information, and we have relied upon such information being complete and accurate in all material respects. We have assumed, with your consent, that the financial forecasts provided to us and discussed with us have been reasonably prepared on a basis reflecting the best currently available estimates and judgments of the senior management and key personnel of Pontotoc. In addition, we have not conducted a physical inspection or made an independent evaluation or appraisal of assets of Pontotoc, nor have we been furnished with any such evaluation or appraisal. Our opinion relates to Pontotoc as a going concern and, accordingly, we express no opinion based on its liquidation value. In rendering our opinion, we have assumed that in the course of obtaining any necessary regulatory and governmental approvals for the proposed Transaction, no restriction will be imposed that will have a material adverse effect on the contemplated benefits of the proposed Transaction. Our opinion is based on circumstances as they exist and can be evaluated on, and the information made available to us at, the date hereof and is without regard to any market, economic, financial, legal or other circumstances or event of any kind of nature that may exist or occur after such date. We have not undertaken to reaffirm or revise this opinion or otherwise comment upon any events occurring after the date hereof and do not have any obligation to update, revise or reaffirm this opinion.

     C. K. Cooper & Company, Inc. as part of its investment banking business, is regularly engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, corporate restructurings, negotiated underwriting, secondary distributions of listed and unlisted securities, private placements and valuations for corporate and other purposes. We will receive a fee for our services in connection with rendering our opinion. In the ordinary course of our business, we may actively trade the securities of Pontotoc for our own account and for the accounts of customers and, accordingly, may at any time hold a long or short position in such securities.

     It is understood that this letter is for the information of the Board of Directors of Pontotoc in connection with their consideration of the Transaction and is not to be quoted or referred to, in whole or in part, in any registration statement, prospectus or proxy statement, or in any other document used in connection with the offering or sale of securities, nor shall this letter be used for any other purpose, without C. K. Cooper & Company, Inc.'s prior written consent, which consent will not be unreasonably withheld. However, notwithstanding the foregoing, we consent to the inclusion of the opinion in the Registration Statement on Form S–4, including the prospectus constituting a part hereof, the Schedule TO, Schedule 14D–9 and proxy or information statement (if any) or relating to the Transaction.

     Our opinion does not address the merits of the underlying decision by Pontotoc to engage in the Transaction or the relative merits of the Transaction compared to any alternative business strategy or transaction in which Pontotoc might engage. We were not authorized to solicit, and did not solicit, other potential parties with respect to a business combination with Pontotoc. This opinion is not intended to be and does not constitute a recommendation to any Shareholder regarding whether to tender shares of Pontotoc Common Stock in the Offer or as to how such holder should vote on the approval and adoption of the Merger Agreement or any matter related thereto. We are not expressing any opinion herein as to the prices at which Pontotoc Stock has traded or will trade following the announcement of the Transaction.

     Our opinion addresses solely the fairness of the aggregate transaction consideration payable in the Transaction to holders of Pontotoc Common Stock as a group and not the allocation thereof among the holders of any class or series of Pontotoc Common Stock. Our opinion addresses solely the aggregate Transaction consideration and does not address any other terms or agreements relating to the Transaction.

     Based upon our experience as an investment banker and subject to the foregoing, including the various assumptions and limitations set forth herein, it is our opinion that as of the date hereof the aggregate consideration to be received by the Shareholders of Pontotoc as a group in the Transaction pursuant to the Merger Agreement is fair, from a financial point of view.

Very truly yours,

C. K. COOPER & COMPANY, INC.
By: /s/ Alexander G. Montano
Managing Director

                                                        Annex C

                   U.S. SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                 FORM 10-KSB

             ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

                    For the fiscal year ended: March 31, 2000

                      Commission file number: 0-21313


                            PONTOTOC PRODUCTION, INC.
                ---------------------------------------------
                (Name of small business issuer in its Charter)


           Nevada                                          84-1349552
- -------------------------------                        ------------------
(State or other jurisdiction of                        (I.R.S. Employer
incorporation or organization)                         Identification No.)

                       808 East Main, Ada, Oklahoma 74820
         -----------------------------------------------------------
         (Address of principal executive offices, including zip code)

                                (580) 436-6100
                          --------------------------
                          (Issuer's telephone number)

Securities Registered Pursuant to Section 12(b) of the Act:  None.

Securities Registered Pursuant to Section 12(g) of the Act:

                        Common Stock, $.0001 Par Value

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.

                                Yes [X]   No [ ]

Check if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-B is not contained in this form, and no disclosure will be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ ]

The Issuer's revenues for its most recent fiscal year were $4,962,070.

As of June 9, 2000, 5,176,445 shares of the Registrant's common stock were
outstanding, and the aggregate market value of the shares held by non-
affiliates was approximately $26,786,922.

DOCUMENTS INCORPORATED BY REFERENCE: None.

Transitional Small Business Disclosure Format (check one): Yes __   No X


                                    PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

BACKGROUND

     Pontotoc Production, Inc. (the "Company") was incorporated under the laws
of the State of Nevada on July 1, 1996, under the name Mahogany Capital, Inc.
for the purpose of completing a merger or acquisition with a private entity.

     In September 1996, the Company filed a registration statement with the
Securities and Exchange Commission on Form 10-SB, wherein it registered its
common stock under Section 12(g) of the Securities Exchange Act of 1934, as
amended (the "34 Act").  As a result, the Company became a fully reporting
company under the 34 Act.

     On December 10, 1997, the Company completed a reverse acquisition of 100%
of the outstanding common stock of Pontotoc Production Company, Inc., a Texas
corporation ("PPCI") in exchange for 3,165,000 shares of the Company's Common
Stock which resulted in the shareholders of PPCI acquiring approximately 84.4%
of the shares outstanding in the Company.  In connection with the closing of
this transaction, several shareholders submitted for cancellation a total of
665,000 shares of common stock.  As a result, after the acquisition of PPCI
there were a total of 3,750,000 shares outstanding.

     On December 12, 1997, the Company's shareholders approved a proposal to
change the Company's name to Pontotoc Production, Inc.

     On July 1, 1998, the Company closed on the acquisition of certain oil and
gas properties from Bill G. Cantrell and his affiliated company.  The purchase
price was $2,750,000 in cash and 402,360 restricted shares of the Company's
Common Stock.  Included in the purchase were interests in approximately 82 oil
and gas leases located in the following counties in Oklahoma:  Pontotoc, Coal,
Garvin, and Seminole.  The purchase also included two workover rigs, one
drilling rig, and miscellaneous oil field equipment which relates to the
ongoing production of the oil and gas properties.  The purchase was funded
with $2,050,000 of bank borrowings and $700,000 from the proceeds of a private
offering of common stock and warrants which was partially closed on July 1,
1998.

     On June 1, 2000, the Company closed on the acquisition of Oklahoma Basic
Economy Corporation ("OBEC") and the working interests of OBEC's partners for
$9,900,000 in cash.  The purchase was funded by advances under the Company's
bank credit agreement.  The properties acquired currently produce
approximately 400 net equivalent barrels of oil per day.  Proven reserves on
the properties are estimated to be approximately 7.6 million barrels of oil
equivalent.

     Unless the context otherwise requires, the term "Company" as used herein
refers to the Company and its wholly-owned subsidiary PPCI.

                                      2



DESCRIPTION OF BUSINESS

     GENERAL

     The Company is engaged in the exploration for and the acquisition,
development and production of oil and natural gas.  The Company focuses on
lower risk, shallow oil and gas properties in the State of Oklahoma.  For the
last several years, the Company has been the most active operator in south-
central Oklahoma.  Since its inception in 1985, the Company's subsidiary has
drilled in excess of 93 wells.  Through drilling, acquisition and
recompletions, the Company's estimated proved reserves have reached 4,558,871
barrels of oil and 14,880,375 mcf of gas with an estimated future net revenue
discounted at 10% of $62,984,012 as of March 31, 2000.

OIL AND GAS OPERATIONS

     The Company's operations are conducted in the State of Oklahoma where the
Company owns producing and non-producing property interests in twenty
counties.  The Company's staff oversees the operations of existing properties,
evaluates property acquisition opportunities and drilling prospects, and
oversees drilling and completion of new wells.  Operations are concentrated on
shallow to medium depth properties generally ranging from 1,500 to 5,000 feet.
The funds necessary for acquisition, exploration and development of properties
are generated through cash flow and bank debt.

     The Company acts as "operator" of 260 wells pursuant to standard industry
Operating Agreements.

MARKETS AND CUSTOMERS

     Marketing of the Company's oil and gas production is influenced by many
factors which are beyond the Company's control and the exact effect of which
cannot be accurately predicted.  These factors include changes in supply and
demand, changes in market prices, regulatory changes, and actions of major
foreign producers.

     The Company sells its oil production to Sun Oil Co. (Sunoco) at the
monthly New York Mercantile Exchange average price per barrel less $.35, and
the majority of its gas to Pontotoc Gathering L.L.C. pursuant to a contract
where the Company receives 80% of the spot price less the cost of
transportation.  Crude oil and condensate production are readily marketable.
Crude oil is cost efficiently transportable from production centers to demand
centers and is, therefore, subject to world-wide supply and demand.  Oil
prices are primarily dependent upon available oil supplies which can vary
significantly depending on production and pricing policies of OPEC and other
major producing countries and on significant events in major producing regions
such as the Persian Gulf War in 1991.

     Deregulation of natural gas pricing and transportation have resulted in
far-reaching and fundamental changes in the producing, transportation and
marketing segments of the natural gas industry.  Gas price decontrol and the
advent of an active spot market for natural gas have resulted in prices
received by the Company being subject to significant fluctuations.  Prices
tend to rise in peak demand periods such as fall and winter and to decline
during lower demand periods.  The Company presently sells most of its gas
through short-term contracts with terms of one year or less which are designed
to obtain the best available prices and deliverabilities.  Virtually all of
the Company's gas contracts provide for prices based on monthly spot prices

                                      3


for the applicable market area.  These prices are reduced ("netted") by the
costs of gathering and transporting the gas.

     The Company periodically hedges the price of a portion of its crude oil
production by forward selling in the futures markets.

COMPETITION AND REGULATION

     The oil and gas industry is intensely competitive.  The Company competes
with larger more well established oil and gas companies including, on
occasion, major companies.  The significant areas of competition are in
acquiring oil and gas reserves, acquiring leases for drilling or development,
and selling natural gas.  The primary competitive factors for acquisitions are
the price the Company is willing to pay and the financial resources readily
available to the Company to fund acquisitions.  The primary factors which
affect the Company's ability to sell its natural gas include proximity to
markets, proximity to and capacity of natural gas pipelines and transportation
and processing facilities, and quantities of gas which can be aggregated for
sale.  Although both oil and gas are generally readily saleable at market
prices, they compete for market share with each other and with other energy
sources such as coal and nuclear power.

     Oil and gas drilling and production operations are regulated by various
Federal, state and local agencies.  These agencies issue binding rules and
regulations which increase the Company's cost of doing business and which
carry penalties, often substantial, for failure to comply.  It is anticipated
that the aggregate burden on the Company of Federal, state and local
regulation will continue to increase particularly in the area of rapidly
changing environmental laws and regulations.  The Company believes that its
present operations substantially comply with applicable regulations.  To date,
such regulations have not had a material effect on the Company's operations,
or the costs thereof.  There are no known environmental or other regulatory
matters related to the Company's operations which are reasonably expected to
result in material liability to the Company.  The Company does not believe
that capital expenditures related to environmental control facilities or other
regulatory matters will be material in fiscal 2000.

     No prediction can be made as to what legislation or regulations may be
enacted or what additional legislation or regulations may be proposed.

     EMPLOYEES

     The Company currently has 22 full-time and 8 part-time employees.  The
Company is not subject to any collective bargaining agreement and believes
that its relationship with its employees are good.

     RISK FACTORS

     Shareholders and investors in shares of the Company's Common Stock should
consider the following Risk Factors, in addition to other information in this
Report.

     1.  SUCCESS DEPENDENT ON MANAGEMENT. Success of the Company depends on
the active participation of James "Robby" Robson, Jr., the Company's
President.  The Company does not have an employment agreement with Mr. Robson
and the Company  has no "key man" life insurance on Mr. Robson.  The loss of
the services of Mr. Robson would adversely affect the Company's business.

                                      4




     2.  COMPETITION.  The Company is in an industry characterized by intense
competition. As a result of the Company's small size, the Company is not a
significant factor in the oil and gas exploration and drilling industry.  Many
of the Company's competitors are well established, have been in existence for
significantly longer periods of time than  the Company, have financial,
marketing, and other personnel as well as other resources substantially
greater than the Company.  (See "COMPETITION AND REGULATION.")

     3.  DECLINE IN PRICE OF OIL.  The price of crude oil has historically
been subject to wide fluctuations.  Although crude oil prices were at a
relatively high level during the past fiscal year, there can be no assurance
that such prices will remain at these levels.

     4.  TITLE TO FUTURE ACQUIRED PROPERTIES.   Any interests which the
Company may acquire in undeveloped and non-producing acreage may be in the
form of direct interests in leases, options, or permits with respect to such
acreage.  While the Company will attempt to acquire satisfactory title to such
oil and gas properties, title opinions may not be obtained prior to the time
of acquisition, with the attendant risk that some titles may be defective.
Under such circumstances, future expenditures may be incurred by the Company
for title work or some leasehold properties may be abandoned. In addition,
such leasehold interests may be subject to customary royalty interests, liens
incident to operating agreements, liens for current taxes and other burdens,
minor encumbrances, easements and restrictions, any of which may subject the
Company to future undetermined expenses.

     5.  SPECULATIVE NATURE OF OIL AND GAS EXPLORATION.  Oil and gas
exploration is highly speculative in nature, involves many risks, and
frequently results in unproductive properties.  These risks are significantly
higher for exploratory wells. Therefore, there can be no assurance that the
oil and gas exploration and/or development activities of the Company will be
successful, or that any future production will be profitable.

     6.  OPERATING HAZARDS AND UNINSURED RISKS.  Operations will be subject to
all of the risks normally incident to exploration for and production of oil
and gas, including blowouts, explosions and fires, seepage, and pollution,
each of which could result in damage to or destruction of oil and gas wells or
producing facilities, damage to life and property, environmental damage and
possible legal liability for any or all of such damages.

     7.  COMPETITION FOR SUITABLE PROPERTIES.  There exists substantial
competition in the market for properties suitable for oil and gas exploration.
Established companies may have an advantage over the Company because of
substantially greater resources in terms of number of personnel, finances and
access to technical data to devote to the acquisition of properties.  There
can be no assurance that properties can be obtained or that exploratory work
on any properties acquired in the future will result in commercially produc-
ible reserves, or that any additional properties can be acquired economically.

     8.  GOVERNMENTAL REGULATION AND ENVIRONMENTAL CONTROLS.  Activities of
the Company are subject to extensive federal, state and local laws and
regulations controlling not only the exploration for oil and gas, but also the
possible effects of such activities upon the environment.  Existing as well as
future legislation and regulations could cause additional expense, capital
expenditures, restrictions and delays in the development of properties, the
extent of which cannot be predicted.

                                      5



     9.  CONTROL BY MANAGEMENT AND PRINCIPAL SHAREHOLDERS.  Management
beneficially owns over 40% of the outstanding Common Stock.  (See Item 11.)

     10.  GENERIC PREFERRED STOCK AUTHORIZED.  The Company's Articles of
Incorporation authorize the issuance of up to 5,000,000 shares of Preferred
Stock, the terms, preferences, rights and restrictions of which may be
established by its Board of Directors.  Other companies on occasion have
issued series of such preferred stock with terms, rights, preferences and
restrictions that could be considered to discourage other persons from
attempting to acquire control of such companies and thereby insulate incumbent
management.  It is possible the Company could issue shares of its Preferred
Stock for such a purpose.  In certain circumstances, the existence of
corporate devices which would inhibit or discourage takeover attempts could
have a depressant effect on the market value of the stock of  a company.  The
Board of Directors has no current plans to issue any shares of Preferred
Stock.

     11.  NO DIVIDENDS.  The Company has paid no dividends on its Common Stock
since  incorporation.  The Company does not anticipate paying dividends on its
Common Stock in the foreseeable future and intends to devote any earnings to
the development of the Company's business.

     12.  COMMON STOCK ELIGIBLE FOR RESALE.  Of the 5,176,445 shares of Common
Stock presently outstanding, approximately 2,897,154 shares are "restricted
securities" and under certain circumstances may be sold in compliance with
Rule 144 adopted under the Securities Act of 1933, as amended.  A majority of
these shares are currently eligible for resale under Rule 144.  Future sales
of such shares will in all likelihood depress the market price of the
Company's Common Stock.

ITEM 2.  DESCRIPTION OF PROPERTY.

     GENERAL

     During the year ended March 31, 2000, the Company drilled six wells and
recompleted 22 wells owning an average of 90% interest in each.  Twenty-six
wells have been successfully completed.  One well was turned into a disposal
well and one well was declared a dry hole.  The Company also purchased seven
additional producing leaseholds located in Pontotoc County, Oklahoma.  Also,
the Company sold its leasehold acreage in Okmulgee County, Oklahoma.  Capital
expenditures for oil and gas activities totaled $1,632,982 in the year ended
March 31, 2000.

     During the year ended March 31, 1999, the Company drilled and/or
completed 12 wells owning an average of 92% interest in each.  Eleven wells
have been successfully completed.  The Company also expanded its producing
properties by purchasing interests in an additional 129 leases located in
Blaine, Caddo, Carter, Custer, Dewey, Gradym, Coal, McClain, Logan, Oklahoma,
Latimer, LeFlore, Pittsburg and Pontotoc Counties, Oklahoma.  Capital
expenditures for oil and gas activities totaled $4,262,264 in the year ended
March 31, 1999.

     During the year ended March 31, 1998, the Company drilled seven wells
owning an average of 95% interest in each.  Seven wells have been successfully
completed.  In addition, the Company installed a waterflood in south central
Oklahoma.  The Company also expanded its  producing property by purchasing
100% interest in 20 wells located in Okmulgee and Creek County, Oklahoma.
Capital expenditures for oil and gas activities totaled $694,903 in the year
ended March 31, 1998.
                                      6


     ESTIMATED PROVED OIL AND GAS RESERVES AND FUTURE NET REVENUES

     In March 2000, Fletcher Lewis Engineering, an independent petroleum
engineering firm, estimated proved reserves for the Company's properties which
represented 95% of the estimated future value of the estimated reserves.
Remaining were estimated to represent 5%.  At March 31, 2000, oil represented
65% and natural gas represented 35% of the total reserves denominated in
equivalent barrels using a six Mcf of gas to one barrel of oil conversion
ratio.

     The following table sets forth, as of March 31, 2000, information
regarding the Company's proved reserves.  The average price used to calculate
estimated future net revenues was $24.00 per barrel held constant for oil and
$2.28 per Mcf of gas as of March 31, 2000.  Amounts do not include estimates
of future federal and state income taxes.

                                                             Estimated Future
                         Net Oil    Net Gas      Future      Net Revenues
                         (Bbls)       Mcf        Revenues    Discounted at 10%
                       ---------   ---------   -----------   -----------------
Proved Developed       1,784,802   3,199,614   $ 32,192,127     $20,133,478
Producing
Proved Developed          59,789     232,412   $  1,026,811     $   654,165
Non-Producing
Behind-Pipe              946,081   7,042,958   $ 31,851,563     $17,723,428
Proved Undeveloped     1,768,199   4,405,391   $ 43,139,382     $24,472,941
                       ---------  ----------   ------------     -----------
    Total              4,558,871  14,880,375   $108,209,883     $62,984,012


     PRODUCTION, AVERAGE SALES PRICES AND AVERAGE PRODUCTION COSTS

     The Company's net production quantities and average sales price per unit
for the indicated years are set forth below.

                   YEAR ENDED        YEAR ENDED        YEAR ENDED
                 MARCH 31, 2000    MARCH 31, 1999    MARCH 31, 1998
                ----------------   ---------------   ----------------
PRODUCT         VOLUME    PRICE    VOLUME    PRICE   VOLUME    PRICE
- -------         -------   ------   -------   ------  ------    ------
Gas (Mcf)       637,387   $ 1.76    87,942   $ 1.58  47,077    $ 1.74
Oil (bbls)      159,113   $22.63   137,436   $13.37  84,870    $19.45


     Average production costs, including production taxes, per unit of
production (using a six to one conversion ratio of Mcfs to barrels) were
$5.78, $6.97 and $5.49 per barrel in the years ended March 31, 2000, 1999 and
1998, respectively.



                                      7




     PRODUCTIVE WELLS AND DEVELOPED ACREAGE

     Developed acreage at March 31, 2000, totaled 8,652 net and 14,210 gross
acres.  At March 31, 2000, the Company owned working interests in 187 net (224
gross) oil wells and 30 net (36 gross) gas wells.  In addition, the Company
owned royalty and production payment interests in approximately 48 oil and gas
wells.

     UNDEVELOPED ACREAGE

     As of March 31, 2000, the Company had 2,847 undeveloped acres.

     DRILLING AND NEW ZONE RECOMPLETIONS

     The following tables set forth the number of gross and net oil and gas
wells in which the Company has participated in drilling or new zone
recompletions and the results thereof for the periods indicated.

                                GROSS WELLS

                                  EXPLORATORY           DEVELOPMENT
YEAR ENDED     TOTAL GROSS    -------------------    -----------------
 MARCH 31,       WELLS        OIL     GAS     DRY    OIL    GAS    DRY
- -----------    -----------    ---     ---     ---    ---    ---    ---
  2000            28           3       2       1       5    17       0
  1999            12           0       1       0       6     4       1
  1998             7           0       0       0       7     0       0
  1997            14           0       0       0      12     0       2
  1996            18           0       0       0      16     2       0
1985-1995         50           3       1       6      30     5       5
                 ---           -       -       -      --    --       -
                 129           6       4       7      76    28       8

                                 NET WELLS

                                  EXPLORATORY            DEVELOPMENT
YEAR ENDED     TOTAL NET      -------------------     -----------------
 MARCH 31,       WELLS        OIL     GAS     DRY     OIL    GAS     DRY
- -----------    ----------     ---     ---     ---     ---   ------   ---
  2000           24.00        2.5     2.00    1      5.00   13.5     0
  1999            8.70        0       0.65    0      4.20    3.1     0.75
  1998            5.80        0       0       0      5.80    0       0
  1997           11.60        0       0       0      9.96    0       1.66
  1996           14.94        0       0       0      13.28   1.66    0
1985-1995        41.50        2.49    0.83    3.32   26.56   4.15    4.15
                 -----        ----    ----    ----   -----   ----    ----
                106.54        4.99    3.48    4.32   64.80   22.41   6.56

PRESENT ACTIVITIES

     On June 1, 2000, the Company closed on the acquisition of Oklahoma Basic
Economy Corporation ("OBEC") and the working interests of OBEC's partners for
$9,900,000 in cash.  The purchase was funded by advances under the Company's
bank credit agreement.  The properties acquired currently produce
approximately 400 net equivalent barrels of oil per day.  Proven reserves on
the properties are estimated to be approximately 7.6 million barrels of oil
equivalent.

                                      8



OFFICE LEASE

     The Company currently leases approximately 4,500 square feet of office
space for its offices at 808 East Main, Ada, Oklahoma 74820.  The space is
based on a month-to-month basis at a cost of $1,500 per month from an entity
which is partially owned by the families of Todd Robson and James Robson, Sr.
The Company believes that these offices are suitable and adequate to meet its
present and anticipated needs.

ITEM 3.  LEGAL PROCEEDINGS.

     There are no pending legal proceedings in which the Company is a party,
and the Company is not aware of any threatened legal proceedings involving the
Company.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year ended March 31, 2000.


                                      9



                                   PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     (a)  MARKET INFORMATION.  The Company's Common Stock began trading on the
Nasdaq Small-Cap Market on December 13, 1999, under the symbol "PNTU."  Prior
to that time, the Company's Common Stock was traded on the over-the-counter
market and was quoted on the NASD's OTC Bulletin Board.  The following table
sets forth the high and low sale prices for the Company's securities as
reported by the Nasdaq Stock Market since December 13, 1999, and the high and
low bid prices for the prior periods.

             QUARTER ENDED                 HIGH BID     LOW BID
             -------------                 --------     -------

     June 30, 1998                          $4.50       $2.1875
     September 30, 1998                     $4.50       $3.625
     December 31, 1998                      $3.78125    $1.625
     March 31, 1999                         $5.375      $3.50

     June 30, 1999                          $7.19       $5.00
     September 30, 1999                     $8.50       $6.25
     December 31, 1999                      $8.06       $6.25
     March 31, 2000                         $7.50       $6.00

     (b)  HOLDERS.  As of June 9, 2000, the Company had 135 shareholders of
record.  This does not include shareholders who hold stock in their accounts
at broker/dealers.

     (c)  DIVIDENDS.  The Company has never paid a cash dividend on its common
stock and does not expect to pay a cash dividend in the foreseeable future.

     (d)  RECENT SALES OF UNREGISTERED SECURITIES. During the three months
ended March 31, 2000, the Company issued 330,932 shares of its common stock to
51 persons who exercised warrants which were sold in a private offering of
units during October of 1998.  With respect to these transactions, the Company
relied on Section 4(2) of the Act.  Each person was provided with information
on the Company and each person executed a Subscription Agreement in which he
represented that he was purchasing the shares for investment only and not for
the purpose of resale or distribution.  The appropriate restrictive legend was
placed on the certificates and stop transfer orders were issued to the
transfer agent.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

     RESULTS OF OPERATIONS

     This Report contains forward-looking statements that involve a number of
risks and uncertainties.  While these statements represent the Company's
current judgment in the future direction of the business, such risks and
uncertainties could cause actual results to differ materially from any future
performance suggested herein.  The Company undertakes no obligation to
publicly release the result of any revisions to these forward-looking
statements which may be made to reflect events of circumstances after the date
hereof or to reflect the occurrence of unanticipated events.  Certain factors
that could cause results to differ materially from those projected in the
forward-looking statements are set forth under "RISK FACTORS" in Item 1.

                                      10



YEAR ENDED MARCH 31, 2000 COMPARED TO THE YEAR ENDED MARCH 31, 1999

     Operating revenues for the year ended March 31, 2000, increased
$2,842,640 (134%) from the prior year due to a 549,445 mcf (624%) increase in
gas production and a 21,677 bbls. (16%) increase in oil production which was
achieved by the drilling and successful recompletion of 27 wells through the
year. Also, oil prices received increased 69% ($9.26 per bbl.) and gas prices
received increased 11% (0.18 per mcf).

     Production costs for the year ended March 31, 2000, increased
$472,549(45%) due to the addition of 7 oil and gas properties and the costs
associated with those properties, along with higher production taxes
associated with the increase in oil and gas production.

     Depreciation, depletion and amortization costs of the year ended March
31, 2000, rose $140,094 (63%) as compared to the prior year mainly due to the
addition of oil and gas properties ($1,632,982) and additional property and
equipment ($268,611). General and administrative expenses increased $20,641
(6%) due to the addition of administrative employees.

     YEAR ENDED MARCH 31, 1999 COMPARED TO THE YEAR ENDED MARCH 31, 1998

     Operating revenues for the year ended March 31, 1999, increased $279,947
(15%) from the prior year due primarily to the acquisition of oil and gas
properties.

     Production costs for the year ended March 31, 1999, increased $276,736
(35%) due to the additional oil and gas properties.

     Depreciation, depletion and amortization costs for the year ended March
31, 1999, rose $66,372 (43%) as compared to the prior year due to the addition
of equipment and oil and gas properties.  General and administrative costs
decreased $42,857 (12%) due mainly to a reduction in executive salaries.

     CAPITAL RESOURCES AND LIQUIDITY

     The Company's working capital was $1,883,549 at March 31, 2000, compared
to a (deficit) of ($1,961,142) at March 31, 1999. The increase in working
capital is due to the Company paying off it's long-term debt from proceeds of
warrants exercised and cash provided by operating activities.

     During the year ended March 31, 2000, cash generated by operating
activities was $2,661,997 compared to cash generated of $528,774 for the year
ended March 31, 1999. The increase in the amount of cash generated was
primarily due to the Company's continued recompletion program which increased
gas production by 624% and oil production by 16% together with a 69% increase
in the price of oil.  These factors were the primary contributors to a 603%
increase in net earnings.

     Cash used in investing activities during the year ended March 31, 2000,
was $650,647 compared $3,679,481 for the prior year. The Company paid
$1,534,070 toward the purchase of oil and gas properties and sold $1,088,754
of oil and gas properties which accounts for the decrease.



                                      11



     Cash used in financing activities during the year ended March 31, 2000,
was ($508,723) compared to $3,302,545 provided by financing activities during
the prior year. The Company repaid $2,646,704 and borrowed $281,986 during the
year. Also the Company had net proceeds of $1,855,995 from the sale of common
stock (warrants exercised associated with the private placement completed
during the prior year).

     The Company has approved a budget of approximately $1,500,000 to drill
approximately 10 new wells and to recomplete 25 to 30 existing wells to
continue its shallow gas program started in the prior year.  Effective June 1,
2000, the Company has a $14,500,000 line of credit with an in-state bank.
Interest on the line of credit is Libor plus 1.75% and is secured by certain
oil and gas properties of the Company.

ITEM 7.  FINANCIAL STATEMENTS.

     The financial statements are set forth on pages F-1 through F-20 hereto.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

     No response required.

                                      12


                                   PART III


ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.

     The directors and executive officers of the Company and its wholly-owned
subsidiary, their ages and positions held in the Company are as follows:

          NAME               AGE           POSITIONS HELD AND TENURE
          ----               ---           -------------------------
James "Robby" Robson, Jr.    41     President, Chief Executive Officer and
                                    Director

Todd Robson                  37     Vice President, Secretary, Treasurer
                                    and Director

James Robson, Sr.            61     Vice President and Director

Brian K. Gourley             38     Director

Timothy A. Jurek             49     Director

Lyle P. Phillips             62     Director

     There is no family relationship between any Director or Executive Officer
of the Company except that James Robby Robson, Jr. and Todd Robson are
brothers and their father is James Robson, Sr.

     The Company has an audit committee which consists of Brian K. Gourley,
Lyle P. Phillips and Todd Robson.  The audit committee reviews the annual
financial statements, any significant accounting issues, and the scope of the
audit with the independent auditors and discusses with the auditors any other
audit-related matters that may arise.

     Set forth below are the names of all Directors and Executive Officers of
the Company, all positions and offices with the Company held by each such
person, the period during which he has served as such, and the principal
occupations and employment of such persons during at least the last five
years:

     JAMES "ROBBY" ROBSON, JR. - President, Chief Executive Officer and
Director.  Mr. Robson has served as the President, Chief Executive Officer and
a Director of the Company since December 1997, and has held these same
positions with Pontotoc  Production Company, Inc., the Company's wholly-owned
subsidiary, since January 1987.  From January 1985 through January 1987, he
worked as a consultant for Pontotoc Production Company, Inc.  From April 1982
until January 1985, he served as the President of Robco Oil Co.  From August
1981 until March 1982 he served as Vice President of Marketing for Daner Oil
Co., Inc.  From March 1981 until August 1981, he was a free agent running back
with the Pittsburgh Steelers.  Mr. Robson attended Youngstown State University
from 1977 until 1981.



                                      13



     TODD ROBSON - Vice President, Secretary, Treasurer and Director.  Mr.
Robson has served as Vice President, Secretary and a Director of the Company
since December 1997, and has held these same positions with Pontotoc
Production Company, Inc., the Company's wholly-owned subsidiary, since January
1987.  From January 1985 until January 1987, he served as President and a
Director of Pontotoc Production Company, Inc.  From January 1983 until January
1985, he was Vice President of Marketing for Robco Oil Co., Inc.

     JAMES ROBSON, SR. - Vice President and Director.  Mr Robson has served as
Vice President and Director of the Company since December 1997, and has held
these same positions with Pontotoc Production Company, Inc., the Company's
wholly-owned subsidiary, since January 1985.   From April 1982 until January
1985, he served as Vice President of Operations for Robco Oil Co., Inc.

     BRIAN K. GOURLEY - Director.  Mr. Gourley has served as a Director of the
Company since January 1998.  He has served as Chief Operating Officer and a
Partner of  BetterBody Company, Ada, Oklahoma, a company engaged in orthopedic
manufacturing, since January 1998.  From April 1989 until January 1997, he
served as Vice President of Operations and a Partner of Look, Inc., a company
engaged in manufacturing medical eye implant devices.  From April 1986 until
April 1989, he was the Production Engineering Manager and Chief Engineer of
Electrovert USA Corp.

     TIMOTHY A. JUREK - Director.  Mr. Jurek has served as a Director of the
Company since September 1999.  He has served as the President of Pontotoc
Gathering LLC since March 1999.  He worked as a project engineer for Conoco
from 1978 until 1981.  In 1981, he formed Western States Gas, the first of
five natural gas gathering and marketing companies which Mr. Jurek founded and
operated between 1981 and 1999.  He has provided independent consulting
services to the gas industry, been involved with acquisitions and mergers,
served as an officer and director and has been a member of gas industry
associations.

     LYLE P. PHILLIPS - Director.  Mr. Phillips has served as a Director of
the Company since September 1999.  Mr. Phillips has been a private investor
since August 1993.  From September 1989 to August 1993, he served as Vice
Chairman and as a director of First Continental Bank & Trust Co.  From March
1991 until December 1992, he also served as the President and CEO of First
Continental Bank & Trust.  From September 1981 to June 1988, Mr. Phillips
served as Vice Chairman, President and CEO of Kustom Electronics.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

     Based solely on a review of Forms 3 and 4 and amendments thereto
furnished to the Company during its most recent fiscal year, and Forms 5 and
amendments thereto furnished to the Company with respect to its most recent
fiscal year and certain written representations, no persons who were either a
Director, Officer or beneficial owner of more than 10% of the Company's Common
Stock, failed to file on a timely basis reports required by Section  16(a) of
the Exchange Act during the most recent fiscal year.

ITEM 10.  EXECUTIVE COMPENSATION.

     The following table sets forth information regarding the executive
compensation for the Company's President and each other executive officer
whose total annual salary and bonus exceeded $100,000 for the year ended March
31, 2000, 1999 and 1998:

                                      14



                                  SUMMARY COMPENSATION TABLE

                                                           LONG-TERM COMPENSATION
                                                   -----------------------------------
                           ANNUAL COMPENSATION         AWARDS        PAYOUTS
                          -----------------------  ----------------- --------
                                                            SECURI-
                                                             TIES
                                                            UNDERLY-
                                           OTHER     RE-      ING               ALL
                                           ANNUAL  STRICTED OPTIONS/           OTHER
NAME AND PRINCIPAL                         COMPEN-  STOCK     SARs     LTIP    COMPEN-
     POSITION       YEAR  SALARY   BONUS   SATION  AWARD(S) (NUMBER)  PAYOUTS  SATION
- ------------------  ----  -------  -----   ------  -------- --------  -------  ------
James "Robby"       2000  $50,160    --    $6,561     --       --        --      --
 Robson, Jr.,       1999  $36,500    --    $3,504     --       --        --      --
 President                                    FN1
                    1998  $84,000    --    $4,806     --       --        --      --
                                              FN1
_______________

  Represents dues paid to Oak Hill Country Club.

STOCK OPTION PLAN

     During November 1997, the Board of Directors adopted a Stock Option Plan
(the "Plan"), and on November 12, 1997, the Corporation's shareholders
approved the Plan.  The Plan authorizes the issuance of options to purchase up
to 500,000 shares of the Company's Common Stock.

     The Plan allows the Board to grant stock options from time to time to
employees, officers, directors and consultants of the Company.  The Board has
the power to determine at the time that the option is granted whether the
option will  be an Incentive Stock Option (an option which qualifies under
Section 422 of the Internal Revenue Code of 1986) or an option which is not an
Incentive Stock Option.  Vesting provisions are determined by the Board at the
time options are granted.  The option price for any option will be no less
than the fair market value of the Common Stock on the date the option is
granted.

     Since all options granted under the Plan must have an exercise price no
less than the fair market value on the date of grant, the Company will not
record any expense upon the grant of options, regardless of whether or not
they are incentive stock options for stock options granted to employees.  In
accordance with FASB Interpretation No. 44 of APB25, Accounting for Stock
Issued to Employees, stock options granted to non-employees subsequent to
December 15, 1998 are measured at the fair value of the options.  The
Interpretation requires accounting recognition attributable to the service
period remaining subsequent to July 1, 2000.  Generally, there will be no
federal income tax consequences to the Company in connection with Incentive
Stock Options granted under the Plan.  With regard to options that are not
Incentive Stock Options, the Company will ordinarily be entitled to deductions
for income tax purposes of the amount that option holders report as ordinary
income upon the exercise of such options, in the year such income is reported.

                                      15

     As of March 31, 2000, 92,500 options were outstanding.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The following table sets forth, as of May 31, 2000, the stock ownership
of each person known by the Company to be the beneficial owner of five percent
or more of the Company's Common Stock, each director individually, and all
officers and directors as a group.  Each person has sole voting and investment
power over the shares except as noted.

                                     AMOUNT AND
  NAME AND ADDRESS                 NATURE OF BENE-          PERCENT
OF BENEFICIAL OWNERS               FICIAL OWNERSHIP         OF CLASS
- -------------------------          ----------------         --------
James "Robby" Robson, Jr.                572,797              11.1%
1500 East 17th Street
Ada, Oklahoma 74820

Todd Robson                              570,161              11.0%
701 South Shumard
Ada, Oklahoma 74820

James Robson, Sr.                        580,851              11.2%
Route 4, Box 437
Ada, Oklahoma 74820

Brian K. Gourley                          58,671               1.1%
305 North Lake Drive
Ada, Oklahoma 74820

Lyle P. Phillips                         299,000 (1)           5.8%
11420 High Drive
Leawood, Kansas  66211

Timothy A. Jurek                          25,000                .5%
1345 East 29th Street
Tulsa, Oklahoma  74114

All Directors and Executive            2,106,480              40.7%
Officers as a Group (6 Persons)
______________

(1)  Includes 256,000 shares held by a revocable trust of Mr. Phillips; 25,000
shares held by a revocable trust of Mr. Phillips' wife; and 18,000 shares held
by a trust of which Mr. Phillips' wife serves as trustee.

     The Company knows of no arrangement or understanding, the operation of
which may at a subsequent date result in a change of control of the Company.


                                      16



ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     During March 1999, the Company and Timothy A. Jurek (who has
approximately 20 years experience in building and operating natural gas
gathering and marketing companies) formed Pontotoc Gathering LLC for the
purpose of building a gas line which could be used to transport and market gas
from the Company's existing and future wells in Pontotoc County.  The Company
and Mr. Jurek are each 45% owners of this LLC and two employees of the LLC own
the other 10%.  During September 1999 Mr. Jurek was added to the Company's
Board of Directors.

     During the year ended March 31, 2000, the Company recognized
approximately $113,000 in income from Pontotoc Gathering LLC.  During 1999,
the Company loaned $70,000 to this LLC under a note agreement which requires
monthly payments of interest at 10% and matures on April 30, 2001.  During the
year ended March 31, 2000, the Company received principal payments of $63,700
on this note, leaving an outstanding balance at March 31, 2000 of $6,300.

     The Company sells its natural gas to the LLC on an 80/20 contract which
means that the Company receives 80% of the spot price less the cost of
transportation.   Prior to setting up this LLC the Company received
approximately 55% of the spot price less the cost of transportation.

     Management believes that the terms of the transactions with Pontotoc
Gathering LLC are at least as favorable as those which could be obtained from
nonaffiliated parties.

                                    17



                                   PART IV

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K.

     (a)  3.  EXHIBITS.

EXHIBIT
NUMBER      DESCRIPTION                   LOCATION

 3.1        Articles of Incorporation,    Incorporated by reference to
            as Amended                    Exhibit 2.1 to the Registrant's
                                          Form 10-SB Registration State-
                                          filed on September 5, 1996

 3.2        Bylaws                        Incorporated by reference to
                                          Exhibit 2 to the Registrant's
                                          Form 10-SB Registration State-
                                          ment filed on September 5, 1996

10.1        Share Exchange Agreement      Incorporated by reference to
            with Pontotoc Production      the Registrant's Form 8-K dated
            Company, Inc. dated           December 10, 1997, and filed
            December 10, 1997             December 23, 1997

21          Subsidiaries of the           Filed herewith electronically
            Registrant

27          Financial Data Schedule       Filed herewith electronically


     (b) REPORTS ON FORM 8-K.  No Reports on Form 8-K were filed for the last
quarter of the fiscal year covered by this Report.

                                      18



                        INDEX TO FINANCIAL STATEMENTS


                                                              PAGE(S)

Report of Independent Certified Public Accountants . . . . .   F-2

Financial Statements:

     Balance Sheets, March 31, 2000 and 1999 . . . . . . . .   F-3

     Statements of Earnings for the years
     ended March 31, 2000 and 1999. . . . . . . . . . . . . .  F-4

     Statement of Stockholders' Equity
     for the years ended March 31, 2000 and 1999. . . . . . .  F-5

     Statements of Cash Flows for the years
     ended March 31, 2000 and 1999. . . . . . . . . . . . . .  F-6

     Notes to Financial Statements. . . . . . . . . . . . . .  F-8 - F-20


                                     F-1





                 Report of Independent Certified Public Accountants


Board of Directors
Pontotoc Production, Inc.

We have audited the accompanying balance sheets of Pontotoc Production, Inc.,
as of March 31, 2000 and 1999, and the related statements of earnings,
stockholders' equity, and cash flows for the years then ended.  These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.  An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.  We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Pontotoc Production, Inc., as
of March 31, 2000 and 1999, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted
accounting principles.




/s/ Grant Thornton LLP

GRANT THORNTON LLP

Oklahoma City, Oklahoma
May 12, 2000



                                      F-2



                           PONTOTOC PRODUCTION, INC.

                                BALANCE SHEETS

                                   March 31,

     ASSETS                                         2000           1999
                                                 ----------     ----------
CURRENT ASSETS
  Cash and cash equivalents (note A1)            $1,773,797     $  271,170
  Trading securities (note A2)                        4,723          2,188
  Accounts receivable, net of allowance
   for doubtful accounts of $1,361 in
   2000 and 1999 (note A8)                          700,376        295,542
  Other current assets (note A3)                     17,915         29,567
                                                 ----------     ----------
     Total current assets                         2,496,811        598,467

PROPERTY AND EQUIPMENT - AT COST, net
 (notes A4 and B)                                   397,587        175,248
OIL AND GAS PROPERTIES - AT COST, net,
 using the full cost method (notes A5,
 C, D, and E)                                     5,816,147      5,587,199
NOTE RECEIVABLE - AFFILIATE (note J)                  7,800         70,000
OTHER (note J)                                      170,461          9,400
                                                 ----------     ----------
                                                 $8,888,806     $6,440,314
                                                 ==========     ==========

     LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
 Accounts payable                                $   91,960     $   59,181
 Accrued and other current liabilities               24,239         51,408
    Income taxes payable (note F)                   230,917          9,809
    Deferred income taxes (note F)                  266,146         74,493
    Current portion of long-term debt (note E)            -      2,364,718
                                                 ----------     ----------
          Total current liabilities                 613,262      2,559,609

DEFERRED INCOME TAXES (note F)                      882,219        443,914

COMMITMENTS AND CONTINGENCIES (note G)                    -              -

STOCKHOLDERS' EQUITY (note K)
 Common stock - $.0001 par value; authorized,
  100,000,000 shares; issued and outstanding,
  5,176,445 shares in 2000 and 4,654,513
  shares in 1999                                        517            465
 Preferred stock - $.0001 par value;
  authorized, 5,000,000 shares; issued and
  outstanding, none                                       -              -
 Additional paid-in capital                       3,980,550      2,018,828
 Retained earnings                                3,412,258      1,417,498
                                                 ----------     ----------
                                                  7,393,325      3,436,791
                                                 ----------     ----------
                                                 $8,888,806     $6,440,314
                                                 ==========     ==========

The accompanying notes are an integral part of these statements.

                                      F-3


                           PONTOTOC PRODUCTION, INC.

                            STATEMENTS OF EARNINGS

                              Year ended March 31,

                                                    2000          1999
                                                 ----------     ----------
Operating revenues
 Oil and gas sales (note A8)                     $4,832,805     $2,034,087
 Well supervision fees and overhead
  reimbursements                                    129,265         85,343
                                                 ----------     ----------
                                                  4,962,070      2,119,430

Operating costs and expenses
 Production                                       1,533,360      1,060,811
 Depreciation, depletion, and amortization          361,552        221,458
 General, administrative, and other                 340,522        319,881
                                                 ----------     ----------
                                                  2,235,434      1,602,150
                                                 ----------     ----------
     Earnings from operations                     2,726,636        517,280

Other income                                        226,336         14,453
Interest expense                                   (107,146)      (148,449)
                                                 ----------     ----------
     Earnings before income taxes                 2,845,826        383,284

Provision for income taxes (note F)                 851,066         99,723
                                                 ----------     ----------
     NET EARNINGS                                $1,994,760     $  283,561
                                                 ==========     ==========

Earnings per share - basic (note A9)             $      .41     $      .06
                                                 ==========     ==========

Earnings per share - diluted (note A9)           $      .40     $      .06
                                                 ==========     ==========

Weighted average number of common
 shares outstanding:
  Basic                                           4,823,521      4,420,761
                                                 ==========     ==========
  Diluted                                         5,009,576      4,471,346
                                                 ==========     ==========

The accompanying notes are an integral part of these statements.

                                      F-4


                            PONTOTOC PRODUCTION, INC.

                        STATEMENT OF STOCKHOLDERS' EQUITY

                       Years ended March 31, 2000 and 1999

                                                    Additional
                                   Common stock      paid-in      Retained
                                Shares     Amount    capital      earnings     Total
                               ---------   -------  ----------   ----------  ----------
Balance at April 1, 1998       3,750,000   $  375   $  108,924   $1,133,937  $1,243,236

Issuance of common stock,
net of offering costs of
approximately $103,000           904,513       90    1,909,904            -   1,909,994

Net earnings                           -        -            -      283,561     283,561
                               ---------   -------  ----------   ----------  ----------

Balance at March 31, 1999      4,654,513       465   2,018,828    1,417,498   3,436,791

Issuance of common stock         521,932        52   1,961,722            -   1,961,774

Net earnings                           -         -           -    1,994,760   1,994,760
                               ---------   -------  ----------   ----------  ----------

Balance at March 31, 2000      5,176,445   $   517  $3,980,550   $3,412,258  $7,393,325
                               =========   =======  ==========   ==========  ==========

The accompanying notes are an integral part of this statement.

                                      F-5




                            PONTOTOC PRODUCTION, INC.

                            STATEMENTS OF CASH FLOWS

                              Year ended March 31,

                                                    2000           1999
                                                 -----------    -----------
Increase (Decrease) in Cash and Cash
 Equivalents

Cash flows from operating activities
 Net earnings                                    $ 1,994,760    $   283,561
 Adjustments to reconcile net earnings
  to net cash provided by operating
  activities
   Depreciation, depletion, and amortization         361,552        221,458
   Deferred income taxes                             629,958         97,364
   Net earnings in excess of distributions
    from investees                                  (113,451)
   Amortization of consulting agreement               14,316              -
   Change in assets and liabilities
    (Increase) decrease in
     Trading securities                               (2,535)         3,062
     Accounts receivable, net                       (404,834)       (45,308)
     Other assets                                       (154)       (29,567)
    Increase (decrease) in
     Accounts payable                                (11,554)       (14,726)
     Accrued and other current liabilities           (27,169)        19,544
     Income taxes payable                            221,108         (6,614)
                                                 -----------    -----------
      Net cash provided by operating activities    2,661,997        528,774

Cash flows from investing activities
 Proceeds from note receivable - affiliate            63,700              -
 Issuance of note receivable - affiliate              (1,500)       (70,000)
 Purchase of property and equipment                 (267,531)       (40,095)
 Proceeds on sales of property and equipment       1,088,754        195,433
 Oil and gas property additions                   (1,534,070)    (3,760,319)
 Other                                                     -         (4,500)
                                                 -----------    -----------
      Net cash used in investing activities         (650,647)    (3,679,481)

Cash flows from financing activities
 Borrowings                                          281,986      2,715,250
 Repayment of borrowings                          (2,646,704)      (820,754)
 Issuance of common stock, net of offering costs   1,855,995      1,408,049
                                                 -----------    -----------
      Net cash provided by (used in) financing
       activities                                   (508,723)     3,302,545

      NET INCREASE IN CASH AND CASH EQUIVALENTS    1,502,627        151,838

Cash and cash equivalents at beginning of year       271,170        119,332
                                                 -----------    -----------
Cash and cash equivalents at end of year         $ 1,773,797    $   271,170
                                                 ===========    ===========


                                      F-6




                             P0NTOTOC PRODUCTION, INC.

                        STATEMENTS OF CASH FLOWS - CONTINUED

                                Year ended March 31,

                                                    2000           1999
                                                 -----------    -----------

Supplemental Cash Flow Information

Cash paid during the year for:

    Interest                                     $   107,146    $   148,449
    Income taxes                                           -          8,973

Noncash investing and financing activities:

During 2000, a consulting agreement was financed through the issuance of
14,000 shares of common stock with a fair value of $50,120.  Under this
agreement, consulting services are provided for 42 months which resulted in an
expense in the current year of $14,316.

During 2000 and 1999, property and equipment and oil and gas property
additions of $55,659 and $501,945 were financed through the issuance of 13,000
and 439,513 shares of common stock, respectively.

During 2000 and 1999, depreciation expense on oil field service equipment of
$14,382 and $23,686, respectively, was capitalized to oil and gas properties.
During 2000, property and equipment and oil and gas property additions of
$44,333 were financed through accounts payable.

The accompanying notes are an integral part of these statements.

                                      F-7

                            PONTOTOC PRODUCTION, INC.

                        NOTES TO FINANCIAL STATEMENTS

                           March 31, 2000 and 1999

NOTE A - NATURE OF OPERATIONS AND SUMMARY OF ACCOUNTING POLICIES

On December 10, 1997, Pontotoc Production Company, Inc. ("Pontotoc"), an
existing oil and gas exploration company, was acquired by Mahogany Capital,
Inc. ("Mahogany"), a nonoperating public shell corporation, through exchange
of 100% of the issued and outstanding shares of Pontotoc's common stock for
approximately 84% of the outstanding shares of Mahogany's common stock.
Mahogany's legal name was changed to Pontotoc Production, Inc. (the
"Company").  The acquisition was considered to be a capital transaction, in
substance equivalent to the issuance of stock by Pontotoc for the net monetary
assets of Mahogany, accompanied by a recapitalization of Pontotoc.  Common
stock and additional paid-in capital were restated to reflect this
recapitalization.

The major operations of the Company consist of exploration, production, and
sale of crude oil and natural gas in the United States with an area of
concentration in shallow reserves in the vicinity of Pontotoc County,
Oklahoma.  Other business segments are not a significant factor in the
Company's operation.

A summary of the significant accounting policies consistently applied in the
preparation of the accompanying financial statements follows.

1.    Cash and Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less and money market funds to be cash
equivalents.

The Company maintains its cash in bank deposit accounts and money market funds
which may not be federally insured.  The Company has not experienced any
losses in such accounts and believes it is not exposed to any significant
credit risk on such accounts.

At March 31, 2000, the Company had cash and cash equivalents of approximately
$1,684,000 at one financial institution.

2.    Investments

Trading securities are carried at fair value with unrealized gains and losses
included in earnings.

Investments in affiliated companies and joint ventures owned 20% to 50% or
which the Company is able to exercise significant influence over operations
are accounted for on the equity method.  Accordingly, the consolidated
statements of earnings include the Company's share of the affiliated entities'
net earnings.



                                      F-8




                            PONTOTOC PRODUCTION, INC.

                   NOTES TO FINANCIAL STATEMENTS - CONTINUED

                            March 31, 2000 and 1999

NOTE A - NATURE OF OPERATIONS AND SUMMARY OF ACCOUNTING POLICIES - CONTINUED

3.    Futures Contracts

The Company contracts to sell crude oil at future dates at prices based on
then-current market prices.  Due to wide fluctuations in the market prices for
crude oil, the Company frequently enters into futures contracts to hedge the
price risk associated with anticipated sales.  Gains and losses on these
contracts are deferred and recognized concurrently with the revenues from the
associated exposures.  At March 31, 2000, the Company has entered into futures
contracts settling at various dates through July 2000.

The losses on these futures contracts at March 31, 2000 and 1999 of
approximately $6,300 and $29,600, respectively, have been deferred and are
reflected in other current assets.

4.    Property and Equipment

Depreciation and amortization are provided in amounts sufficient to relate the
cost of depreciable assets to operations over their estimated service lives
using an accelerated method.  Estimated useful lives are as follows:

         Furniture, fixtures, and office equipment    5-7 years
         Automobiles and trucks                         5 years
         Leasehold improvements                         7 years
         Oil field service equipment                  5-7 years

Impairment losses are recorded on property and equipment when indicators of
impairment are present and the undiscounted cash flows estimated to be
generated by those assets are less than the assets' carrying amount.

5.    Oil and Gas Properties

The full cost method of accounting is used to account for oil and gas
properties.  Under this method of accounting, all costs incident to the
acquisition, exploration, and development of properties (both developed and
undeveloped), including costs of abandoned leaseholds, lease rentals,
unproductive wells, and well drilling and equipment costs, are capitalized.
These costs as well as estimated future development costs on proved
undeveloped properties are amortized using the units-of-production method.
The units-of-production method is based primarily on estimates of reserve
quantities.  Due to uncertainties inherent in this estimation process, it is
at least reasonably possible that reserve quantities will be revised
significantly in the near term.  If the Company's unamortized costs exceed the
cost center ceiling (defined as the sum of the present value, discounted at
10%, of estimated future net revenues from proved reserves, less related
income tax effects), the excess is charged to expense in the year in which the
excess occurs.  Generally, no gains or losses are recognized on the sale or
disposition of oil and gas properties.  Income in connection with contractual
services performed on wells in which the Company has an economic interest is
credited to oil and gas properties as a component of the full cost pool.




                                     F-9




                            PONTOTOC PRODUCTION, INC.

                   NOTES TO FINANCIAL STATEMENTS - CONTINUED

                            March 31, 2000 and 1999

NOTE A - NATURE OF OPERATIONS AND SUMMARY OF ACCOUNTING POLICIES - CONTINUED

6.    Revenue Recognition

Oil and gas sales are recognized when the product is transported from the well
site.  Well supervision fees and overhead reimbursements from producing
properties are recognized when the services are performed.

7.    Income Taxes

Deferred income taxes are provided for significant carryforwards and temporary
differences between the tax basis of an asset or liability and its reported
amount in the financial statements that will result in taxable or deductible
amounts in future years.  Deferred income tax assets or liabilities are
determined by applying the presently enacted tax rates and laws.

A valuation allowance for deferred tax assets is required when it is more
likely than not that some portion or all of the deferred tax assets will not
be realized.  Management believes a valuation allowance is not required for
deferred tax assets at March 31, 1999.

8.    Concentrations of Credit Risk and Major Customers

The Company extends credit to purchasers of oil and natural gas which are
primarily large energy companies.  The Company had two purchasers whose
purchases were approximately 72% and 19% of total revenues for the year ended
March 31, 2000.  Additionally, the Company had two purchasers whose purchases
were approximately 56% and 29% of accounts receivable at March 31, 2000.  The
Company had one purchaser whose purchases were 87% of total revenues, and were
approximately 65% of accounts receivable at March 31, 1999.

9.    Earnings Per Share

Basic earnings per common share are based upon the weighted average number of
common shares outstanding.  Diluted earnings per common share are based on the
assumption that all of the common stock options and purchase warrants are
converted into common shares using the treasury stock method.  There are no
differences in net earnings for purposes of computing basic and diluted
earnings per share as conversion of the common stock options and purchase
warrants would have no effect on net earnings.

The following table sets forth the computation of weighted average shares
outstanding, basic and diluted, for the years ended March 31:

                                               2000        1999
                                            ---------    ---------
   Weighted average shares outstanding      4,823,521    4,420,761
   Effect of dilutive securities -
    common stock purchase warrants            159,685       50,585
   Effect of dilutive securities -
    stock options                              26,370            -
                                            ---------    ---------
   Weighted average shares outstanding -
    assuming dilution                       5,009,576    4,471,346
                                            =========    =========
                                   F-10


                            PONTOTOC PRODUCTION, INC.

                   NOTES TO FINANCIAL STATEMENTS - CONTINUED

                            March 31, 2000 and 1999

NOTE A - NATURE OF OPERATIONS AND SUMMARY OF ACCOUNTING POLICIES - CONTINUED

Options to purchase 50,000 shares of common stock at $8.50 per share were
outstanding during a portion of fiscal year 2000 but were not included in the
computation of diluted earnings per share because the exercise price was
greater than the average market price of the common shares and, therefore, the
effect would be anti-dilutive.

10.    Use of Estimates

In preparing financial statements in conformity with generally accepted
accounting principles, management makes estimates based on management's
knowledge and experience.  Actual results could differ from those estimates.

11.    Recently Issued Accounting Pronouncement

In June 1998, the Financial Accounting Standards Board issued Statement No.
133, Accounting for Derivative Instruments and Hedging Activities, which
requires an entity to recognize derivates as assets or liabilities in the
balance sheet and measure them at fair value.  The Company will adopt
Statement No. 133 in the first quarter of fiscal 2001; however, the effect of
adoption has not been determined.

NOTE B - PROPERTY AND EQUIPMENT

Major classes of property and equipment consisted of the following at March
31:

                                                      2000        1999
                                                    --------    --------

   Furniture, fixtures, and office equipment        $ 80,015    $ 45,789
   Automobiles and trucks                            243,498     155,114
   Leasehold improvements                              7,261       7,261
   Oil field service equipment                       300,935     300,935
                                                    --------    --------
                                                     631,709     509,099
     Less accumulated depreciation and
      amortization                                   419,622     373,351
                                                    --------    --------
                                                     212,087     135,748
   Land                                              185,500      39,500
                                                    --------    --------
                                                    $397,587    $175,248
                                                    ========    ========


                                     F-11


                            PONTOTOC PRODUCTION, INC.

                   NOTES TO FINANCIAL STATEMENTS - CONTINUED

                            March 31, 2000 and 1999

NOTE C - OIL AND GAS INFORMATION

Costs related to the oil and gas activities of the Company were incurred as
follows:

                                                    Year ended March 31,
                                                 -------------------------
                                                    2000           1999
                                                 ----------     ----------
     Property acquisition costs                  $  557,572     $3,761,791
     Development costs                            1,075,410        282,828

The Company had the following aggregate capitalized costs relating to the
Company's oil and gas activities at March 31:

                                                    2000           1999
                                                 ----------     ----------
     Proved oil and gas properties               $6,567,544     $6,008,933
     Less accumulated depreciation,
      depletion, and amortization                   751,397        421,734
                                                 ----------     ----------
                                                 $5,816,147     $5,587,199
                                                 ==========     ==========

Depreciation, depletion, and amortization expense of oil and gas properties
amounted to $1.24 and $1.32 per equivalent barrel of production for the years
ended March 31, 2000 and 1999, respectively.

NOTE D - OIL AND GAS RESERVE DATA (UNAUDITED)

The following estimates of proved reserve quantities and related standardized
measure of discounted net cash flows are estimates only, and do not purport to
reflect realizable values or fair market values of the Company's reserves.
The Company emphasizes that reserve estimates are inherently imprecise and
that estimates of new discoveries are more imprecise than those of producing
oil and gas properties. Accordingly, these estimates are expected to change as
future information becomes available.  All of the Company's reserves are
located in the United States.

Proved reserves are estimated reserves of crude oil (including condensate and
natural gas liquids) and natural gas that geological and engineering data
demonstrate with reasonable certainty to be recoverable in future years from
known reservoirs under existing economic and operating conditions.  Proved
developed reserves are those expected to be recovered through existing wells,
equipment, and operating methods.

The standardized measure of discounted future net cash flows is computed by
applying year-end prices of oil and gas (with consideration of price changes
only to the extent provided by contractual arrangements) to the estimated
future production of proved oil and gas reserves, less estimated future
expenditures (based on year-end costs) to be incurred in developing and
producing the proved reserves, less estimated future income tax expenses
(based on year-end statutory tax rates, with consideration of future tax rates
already legislated) to be incurred on pretax net cash flows less tax basis of
the properties and available credits, and assuming continuation of existing

                                      F-12



                            PONTOTOC PRODUCTION, INC.

                   NOTES TO FINANCIAL STATEMENTS - CONTINUED

                            March 31, 2000 and 1999

NOTE D - OIL AND GAS RESERVE DATA (UNAUDITED) (CONTINUED)

economic conditions.  The estimated future net cash flows are then discounted
using a rate of 10% a year to reflect the estimated timing of the future cash
flows.

The following summaries of changes in reserves and standardized measure of
discounted future net cash flows were prepared from estimates of proved
reserves developed by an independent petroleum engineer.

                      Summary of Changes in Proved Reserves

                                            Year ended March 31,
                                  ------------------------------------------
                                           2000                  1999
                                  ---------------------  -------------------
                                     Bbls        Mcf       Bbls        Mcf
                                  ---------   ---------  ---------  --------
Proved developed and undeveloped
 reserves
  Beginning of year              4,287,264   9,483,050   1,526,072    478,371
  Extensions and discoveries       169,786   1,006,052     375,108  1,570,848
  Purchase of minerals in place    361,231   2,298,029   2,554,298  7,628,178
  Sale of minerals in place       (389,816) (1,664,883)    (28,335)  (136,632)
  Production                      (159,113)   (637,387)   (137,436)   (87,942)
  Revisions of estimates           289,519   4,395,514      (2,443)    30,227
                                 ---------  ----------   ---------  ---------
     End of year                 4,558,871  14,880,375   4,287,264  9,483,050
                                 =========  ==========   =========  =========

Proved developed reserves
 Beginning of year               2,811,300   8,226,484     966,134    478,371
 End of year                     2,790,672  10,474,984   2,811,300  8,226,484

             Standardized Measure of Discounted Future Net Cash Flows
                     Relating to Proved Oil and Gas Reserves

                                                          March 31,
                                                ---------------------------
                                                    2000           1999
                                                ------------   ------------
Future oil and gas revenues                     $142,992,581   $ 82,804,402
Future production and development costs          (34,782,698)   (24,230,176)
                                                ------------   ------------
Future net cash flows before income taxes        108,209,883     58,574,226
Future income taxes                              (35,883,801)   (18,341,880)
                                                ------------   ------------
Future net cash flows after income taxes          72,326,082     40,232,346
Discounted at 10% for estimated timing of
 cash flows                                      (29,560,394)   (17,098,747)
                                                ------------   ------------
Standardized measure of discounted future
 net cash flows                                 $ 42,765,688   $ 23,133,599
                                                ============   ============

                                     F-13


                            PONTOTOC PRODUCTION, INC.

                   NOTES TO FINANCIAL STATEMENTS - CONTINUED

                            March 31, 2000 and 1999

NOTE D - OIL AND GAS RESERVE DATA (UNAUDITED) - CONTINUED

      Changes in Standardized Measure of Discounted Future Net Cash Flows
                      Related to Proved Oil and Gas Reserves

                                                    Year ended March 31,
                                                ---------------------------
                                                    2000           1999
                                                ------------   ------------
Sales and transfers of oil and gas
 produced, net of production costs              $ (3,299,445)  $   (973,276)
Development costs incurred during year
 which were previously estimated                   1,075,410         18,303
Extensions and discoveries, net of related
 development costs                                 2,802,453      2,348,716
Net change in income taxes                       (10,372,362)    (6,980,359)
Accretion of discount                              3,664,728      1,075,627
Purchase of minerals in place                      6,586,269     16,974,683
Sale of minerals in place                         (3,856,612)      (196,437)
Net changes in production rates and other          1,422,425      4,110,318
Revisions in quantity estimates                    9,290,864          8,121
Net change in sales and transfer prices,
 net of related production costs                  12,318,359       (442,145)
                                                ------------   ------------
     Net increase                                 19,632,089     15,943,551

  Balance at beginning of year                    23,133,599      7,190,048
                                                ------------   ------------
  Balance at end of year                        $ 42,765,688   $ 23,133,599
                                                ============   ============

NOTE E - LONG-TERM DEBT

Long-term debt consisted of the following at March 31:

                                                    2000           1999
                                                ------------   ------------

Note payable to BancOne, Oklahoma,
 N.A. ("BancOne") bearing interest at bank
 prime (7.75% at March 31, 1999); paid
 off in fiscal 2000; collateralized by
 oil and gas properties                         $          -   $  2,364,718
  Less current maturities                                  -      2,364,718
                                                ------------   ------------
                                                $          -   $          -
                                                ============   ============

The note payable to BancOne is subject to the provisions of a credit
agreement, covenants of which provide for, among other things, current ratio,
debt service ratios, and tangible net worth requirements, as defined.

                                      F-14



                            PONTOTOC PRODUCTION, INC.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                             March 31, 2000 and 1999

NOTE F - INCOME TAXES

The components of income tax expense were as follows:

                                                    Year ended March 31,
                                                 -------------------------
                                                    2000           1999
                                                 ----------     ----------
     Current
      Federal                                    $  172,678     $    2,359
      State                                          48,430              -
                                                 ----------     ----------
                                                    221,108          2,359
     Deferred                                       629,958         97,364
                                                 ----------     ----------
                                                 $  851,066     $   99,723
                                                 ==========     ==========

Deferred tax assets and liabilities consisted of the following at March 31:

                                                    2000           1999
                                                 ----------     ----------

     Assets
      Investments                                $        -     $   21,397
      Other                                               -          1,366
                                                 ----------     ----------
                                                 $        -     $   22,763
                                                 ==========     ==========

     Liabilities
      Conversion from accrual to cash basis      $  233,126     $   73,217
      Investment                                     33,019              -
      Property and equipment                          6,254          6,254
      Oil and gas properties                        875,966        461,699
                                                 ----------     ----------
                                                 $1,148,365     $  541,170
                                                 ==========     ==========

The effective tax rate on earnings before income taxes differs from the
federal statutory tax rate.  The following summary reconciles taxes at the
federal statutory tax rate with actual taxes for the years ended March 31:

                                                    2000           1999
                                                 ----------     ----------
     Computed federal tax provision              $  967,581     $  130,317
     Increase (decrease) in tax from
      Allowable percentage depletion in
       excess of tax basis                         (136,437)       (29,597)
      Nondeductible expenses                          2,287          3,672
      Effect of graduated rates, tax credits,
       and other                                     17,635         (4,669)
                                                 ----------     ----------
         Provision for income taxes              $  851,066     $   99,723
                                                 ==========     ==========

                                    F-15


                           PONTOTOC PRODUCTION, INC.

                  NOTES TO FINANCIAL STATEMENTS - CONTINUED

                            March 31, 2000 and 1999

NOTE G - COMMITMENTS AND CONTINGENCIES

1.    Leases

The Company conducts its operations from facilities which are leased from an
affiliate under an operating lease.  The lease provides for monthly rentals of
$1,500 effective April 1, 2000 and is on a month-to-month basis.

Rent expense for the years ended March 31, 2000 and 1999 was $11,000 and
$12,918, respectively.

2.    Other

The Company is involved in various legal actions relating to its operations.
Management believes that losses, if any, arising from such actions will not be
material to the Company's financial position or results of operations.

NOTE H - FAIR VALUE OF FINANCIAL INSTRUMENTS

The following methods and assumptions were used to estimate the fair value of
each class of financial instruments as of March 31, 2000 and 1999.  Such
information, which pertains to the Company's financial instruments, does not
purport to represent the aggregate net fair value of the Company.  The
carrying amounts in the table are the amounts at which the financial
instruments are reported in the financial statements.

All of the Company's financial instruments are held for purposes other than
trading except for trading securities.  The carrying amounts of cash and cash
equivalents approximate fair values of such assets. The carrying amounts of
trading securities approximate fair values of such assets as carrying values
are adjusted to quoted market prices.  The fair value of note receivable -
affiliate is estimated by using the current rates at which similar loans would
be made to borrowers with similar credit ratings and for the same remaining
maturities.  The carrying amount of variable rate debt approximates fair value
because interest rates adjust to market rates.

                                      2000                      1999
                             -----------------------  -----------------------
                              Carrying    Estimated    Carrying    Estimated
                               amount     fair value    amount     fair value
                             ----------   ----------  ----------   ----------
Financial assets
 Cash and cash equivalents   $1,773,797   $1,773,797  $  271,170   $  271,170
 Trading securities               4,723        4,723       2,188        2,188
 Note receivable - affiliates     7,800        7,800      70,000       70,000

Financial liabilities
 Variable rate long-term debt         -            -  (2,364,718)  (2,364,718)



                                     F-16




                            PONTOTOC PRODUCTION, INC.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                             March 31, 2000 and 1999

NOTE I - PROPERTY ACQUISITIONS

Effective July 1, 1998, the Company acquired oil and gas properties and
equipment from an Oklahoma oil and gas operator for approximately $2,750,000
and 402,000 shares of common stock.  The acquisition has been accounted for
using the purchase method, and the operations of the acquired properties are
included subsequent to July 1, 1998.  The purchase price of approximately
$3,168,500 was allocated to the assets, primarily oil and gas properties,
acquired on the basis of their estimated fair value.

The following summarized pro forma, unaudited, information for the year ended
March 31, 1999 assumes the acquisition had occurred on April 1, 1998:

             Revenues                              $2,395,787
             Net earnings                             360,122
             Basic and diluted earnings per share         .08

NOTE J - RELATED PARTY TRANSACTION

During 1999, the Company acquired a 45% ownership interest in a natural gas
gathering company for $4,500 which is reflected in other assets.  During 2000,
the Company recognized approximately $113,000 in income from the investment in
the gas gathering company which is reflected in other income.

During 1999, the Company loaned $70,000 to the gas gathering company under a
note agreement which requires monthly payments of interest at 10% and matures
on April 30, 2001.  During 2000, the Company received principal payments of
$63,700 on this note, leaving an outstanding balance at March 31, 2000 of
$6,300.

During 2000, the Company advanced an employee $1,500.  The loan matures on
July 1, 2001, earns interest at 8%, and requires monthly payment of $105
beginning on May 1, 2000.

NOTE K - STOCKHOLDERS' EQUITY

During 2000, common stock purchase warrants relating to 494,932 common shares
were exercised at $3.75 per share, for a total of $1,855,995.

In June 1999, the Company issued 8,000 shares of common stock having an
estimated fair value of $4.72 per share in conjunction with the acquisition of
certain oil and gas properties.

In April 1999, the Company issued 5,000 shares of common stock having an
estimated fair value of $3.58 per share in conjunction with the acquisition of
certain oil and gas properties.



                                    F-17


                           PONTOTOC PRODUCTION, INC.

                  NOTES TO FINANCIAL STATEMENTS - CONTINUED

                           March 31, 2000 and 1999

NOTE K - STOCKHOLDERS' EQUITY - CONTINUED

In April 1999, the Company issued 14,000 shares of common stock having an
estimated fair value of $3.58 per share in conjunction with a consulting
agreement.  The award is amortized over the service period of the agreement
(42 months) and resulted in approximately $14,000 of consulting expense in
2000.

During May 1998, the Company issued 37,153 shares of common stock in exchange
for oil and gas properties.  The common stock was valued at $2.25 per share
based on the estimated fair value of the oil and gas properties acquired.

In July 1998, the Company issued 402,360 shares of common stock having an
estimated fair value of $1.04 per share in conjunction with the acquisition of
certain oil and gas properties (see Note I).  The fair value was estimated
based on the fair value of common stock and common stock purchase warrants
being sold through a private placement occurring at approximately the same
time.

The Company completed a private placement in October 1998 of 465,000 shares of
common stock and 465,000 common stock purchase warrants, for $1,408,049, which
is net of offering costs of approximately $103,000.  The warrants are
exercisable at $3.75 per share at any time through February 1, 2000.

The Board of Directors is authorized to issue the Company's preferred stock in
series and is further authorized to establish the relative rights and
preferences for each series, including voting rights and common stock
conversion rights.

NOTE L - STOCK OPTIONS

In April 1999, the Company approved a stock option plan for issuance of up to
500,000 shares of stock to key employees and directors of the Company.  The
stock options vest immediately.

The Company uses the intrinsic value method to account for its stock option
plan in which compensation is recognized only when the fair value of each
option exceeds its exercise price at the date of grant.  Accordingly, no
compensation cost has been recognized for the options issued.  Had
compensation costs been determined based on fair value of the options at the
grant dates, the Company's net income and income per share would have been
decreased to the pro forma amounts for the year ended March 31, 2000.

     Net income
      As reported                               $1,994,760
      Pro forma                                 $1,743,160

     Income per share
      As reported, basic and diluted            $      .41
      Pro forma - basic                         $      .36
      Pro forma - diluted                       $      .35


                                     F-18



                            PONTOTOC PRODUCTION, INC.

                   NOTES TO FINANCIAL STATEMENTS - CONTINUED

                              March 31, 2000 and 1999

NOTE L - STOCK OPTIONS - CONTINUED

The fair value of each grant is estimated on the date of grant using the
Black-Scholes options-pricing model with the following weighted-average
assumptions used for grants in 2000:  no expected dividends; expected
volatility of 57.1%; risk-free interest rate of 5.2%; and expected lives of
five years.  The exercise price of all options equaled or exceeded market
price of the stock at the date of grant.

The Black-Scholes option valuation model was developed for use in estimating
the fair value of traded options which have no vesting restrictions and are
fully transferable.  In addition, option valuation models require the input of
highly subjective assumptions, including the expected stock price volatility.
Because the Company's employee stock options have characteristics
significantly different from those of traded options, and because changes in
the subjective input assumptions can materially affect the fair value
estimate, in management's opinion, the existing models do not necessarily
provide a reliable single measure of the fair value of its employee stock
options.

A summary of the status of the Company's stock options as of March 31, 2000
and changes during the year then ending is presented below.

                                                       Weighted
                                                       average
                                                       exercise
                                            Shares      price
                                            -------    --------

     Outstanding at beginning of year             -      $   -
     Granted                                101,000       5.00
     Exercised                                    -          -
     Forfeited                                8,500       5.00
                                            -------      -----
     Outstanding at end of year              92,500      $5.00
                                            =======      =====

     Options exercisable at year end         92,500      $5.00
                                            =======      =====

     Weighted average fair value of
      options granted during the year                    $2.72

The following table summarizes information about stock options outstanding at
March 31, 2000:

                                                     Weighted-
                                                     average      Weighted-
                                                     remaining    average
                                        Number      contractual   exercise
                                      outstanding      life        price
                                      -----------   -----------   --------

                                         92,500      4.00 years     $5.00

                                      F-19



                             PONTOTOC PRODUCTION, INC.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                              March 31, 2000 and 1999

NOTE M - SUBSEQUENT EVENT

In May 2000, the Company signed a letter of intent to acquire Oklahoma Basic
Economy Corp. ("OBEC"), whose sole assets were oil and gas properties, in a
business combination accounted for as a purchase effective June 1, 2000.  The
purchase price was approximately $9,900,000 and is to be funded by advances
under the bank credit agreement.  The results of the operations of OBEC will
be included with the results of the Company from June 1, 2000.


                                    F-20




                                SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed
on its behalf by the undersigned, thereunto duly authorized.

Date: June 13, 2000                  PONTOTOC PRODUCTION, INC.


                                     By:/s/ James Robby Robson, Jr.
                                        James "Robby" Robson, Jr., President

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

        SIGNATURE                       TITLE                     DATE



/s/ James Robby Robson, Jr.     President (Chief Executive     June 13, 2000
James "Robby" Robson, Jr.       Officer) and Director



/s/ Todd Robson                 Vice President, Secretary,     June 13, 2000
Todd Robson                     Treasurer (Chief Finan-
                                ancial and Accounting
                                Officer) and Director


/s/ James Robson, Sr.           Vice President and Director    June 13, 2000
James Robson, Sr.



/s/ Brian K. Gourley            Director                       June 13, 2000
Brian K. Gourley



/s/ Timothy A. Jurek            Director                       June 13, 2000
Timothy A. Jurek



/s/ Lyle P. Phillips            Director                       June 13, 2000
Lyle P. Phillips



                                                                Exhibit 21


                        SUBSIDIARIES OF THE REGISTRANT

            NAME OF SUBSIDIARY              STATE OF INCORPORATION
            ------------------              ----------------------

    Pontotoc Production Company, Inc.              Texas



								Exhibit 27



This schedule contains summary financial information extracted from the
balance sheets and statements of earnings found on pages F-3 and F-4 of the
Company's Form 10-KSB for the fiscal year ended March 31, 2000, and is
qualified in its entirety by reference to such financial statements.




PERIOD-TYPE                    YEAR
FISCAL-YEAR-END                          MAR-31-2000
PERIOD-END                               MAR-31-2000
CASH                                       1,773,797
SECURITIES                                     4,723
RECEIVABLES                                  701,737
ALLOWANCES                                     1,361
INVENTORY                                          0
CURRENT-ASSETS                             2,496,811
PP&E                                         397,587
DEPRECIATION                                       0
TOTAL-ASSETS                               8,888,806
CURRENT-LIABILITIES                          613,262
BONDS                                              0
PREFERRED-MANDATORY                                0
PREFERRED                                          0
COMMON                                           517
OTHER-SE                                   7,392,808
TOTAL-LIABILITY-AND-EQUITY                 8,888,806
SALES                                      4,832,805
TOTAL-REVENUES                             4,962,070
CGS                                                0
TOTAL-COSTS                                        0
OTHER-EXPENSES                             2,235,434
LOSS-PROVISION                                     0
INTEREST-EXPENSE                             107,146
INCOME-PRETAX                              2,845,826
INCOME-TAX                                   851,066
INCOME-CONTINUING                          1,994,760
DISCONTINUED                                       0
EXTRAORDINARY                                      0
CHANGES                                            0
NET-INCOME                                 1,994,760
EPS-BASIC                                        .41
EPS-DILUTED                                      .40

                                                        Annex D

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                   FORM 10-QSB


              QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                          SECURITIES EXCHANGE ACT OF 1934



                For the quarterly period ended December 31, 2000


                         Commission File Number:  0-21313


                             PONTOTOC PRODUCTION, INC.
       -----------------------------------------------------------------
       (Exact name of small business issuer as specified in its charter)


          Nevada                                       84-1349552
- -------------------------------            ---------------------------------
(State of other jurisdiction of            (IRS Employer Identification No.)
 incorporation or organization)


                       808 East Main, Ada, Oklahoma 74820
          ----------------------------------------------------------
          (Address of principal executive offices including zip code)


                              (580) 436-6100
                        ---------------------------
                        (Issuer's telephone number)






Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the preceding 12 months (or for such
shorter period that the Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

                            Yes X             No___

As of January 30, 2001, 5,213,695 shares of common stock, $.0001 par value per
share, were outstanding.

Transitional Small Business Disclosure Format (check one): Yes___     No_X_







                                     INDEX

                                                                   PAGE
                                                                  NUMBER
Part I.  Financial Information

     Item 1.  Financial Statements

              Balance Sheets as of December 31, 2000
              (Unaudited) and March 31, 2000 (Audited)              3

              Statement of Earnings - Nine Months Ended
              December 31, 2000 and 1999 (Unaudited)                4

              Statement of Earnings - Three Months Ended
              December 31, 2000 and 1999 (Unaudited)                5

              Statements of Cash Flows - Nine Months Ended
              December 31, 2000 and 1999                            6

              Notes to Financial Statements                         8

     Item 2.  Management's Discussion and Analysis of
              Financial Conditions and Results of Operations        12

Part II.  Other Information                                         14

Signature Page                                                      15



                                       2


                            PONTOTOC PRODUCTION, INC.
                                BALANCE SHEETS
                         DECEMBER 31, 2000 (UNAUDITED)
                         AND MARCH 31, 2000 (AUDITED)

               ASSETS                         DECEMBER 31,   MARCH 31,
                                                 2000          2000
                                              (UNAUDITED)    (AUDITED)
                                              ------------  ----------
CURRENT ASSETS
  Cash and cash equivalents                   $  703,767   $1,773,797
  Trading securities                               1,125        4,723
  Accounts receivable, net                     1,452,385      700,376
  Other current assets                           235,734       17,915
                                              ----------   ----------
     Total current assets                      2,393,011    2,496,811

PROPERTY AND EQUIPMENT-AT COST, net              740,871      397,587

OIL AND GAS PROPERTIES-AT COST, net,
  using the full cost method                  21,772,081    5,816,147

NOTE RECEIVABLE-AFFILIATE                          -            7,800

OTHER                                            166,518      170,461
                                              ----------   ----------
                                             $25,072,481   $8,888,806
                                             ===========   ==========
     LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable                           $   233,395   $   91,960
  Accrued and other current liabilities          328,561       24,239
  Income taxes payable                            77,031      230,917
  Deferred income taxes                          760,190      266,146
                                              ----------   ----------
     Total current liabilities                 1,399,177      613,262

LONG-TERM DEBT, less current maturities        7,790,786         -

DEFERRED INCOME TAXES                          5,896,317      882,219

COMMITMENTS AND CONTINGENCIES                       -            -

STOCKHOLDERS' EQUITY
  Common stock - $.0001 par value;
   authorized 100,000,000 shares;
   issued and outstanding, 5,213,695
   and 5,176,445 shares                              521          517
  Additional paid-in capital                   4,169,496    3,980,550
  Retained earnings                            5,816,184    3,412,258
                                             -----------   ----------
                                               9,986,201    7,393,325
                                             -----------   ----------
                                             $25,072,481   $8,888,806
                                             ===========   ==========

The accompanying notes are an integral part of these statements.

                                       3


                           PONTOTOC PRODUCTION, INC.
                        STATEMENT OF EARNINGS-UNAUDITED
              FOR THE NINE MONTHS ENDED DECEMBER 31, 2000 AND 1999


                                                2000          1999
                                              ----------   ----------
Operating revenues
  Oil and gas sales                           $7,236,057   $3,309,977
  Well supervision fees and overhead
   reimbursements                                199,528       87,497
                                              ----------   ----------
                                               7,435,585    3,397,474
                                              ----------   ----------

Operating costs and expenses
  Production                                   2,318,244    1,141,843
  Depreciation, depletion and
   amortization                                  655,361      225,100
  General, administration and other              448,181      255,063
                                              ----------   ----------
                                               3,421,786    1,622,006
                                              ----------   ----------
     Earnings from operations                  4,013,799    1,775,468

Other income (loss)                               41,075      195,699
Interest expense                                (479,558)    (101,533)
                                              ----------   ----------
     Earnings before income taxes              3,575,316    1,869,634

Provision for income taxes                     1,171,391      560,274
                                              ----------   ----------
                                              $2,403,925   $1,309,360
                                              ==========   ==========

Net Earnings Per Share

  Basic                                       $      .46   $      .28
                                              ==========   ==========
  Diluted                                     $      .46   $      .27
                                              ==========   ==========

Weighted average common shares outstanding

  Basic                                        5,195,651    4,734,204
                                              ==========   ==========
  Diluted                                      5,233,844    4,933,527
                                              ==========   ==========

The accompanying notes are an integral part of these statements.

                                      4



                           PONTOTOC PRODUCTION, INC.
                        STATEMENT OF EARNINGS-UNAUDITED
             FOR THE THREE MONTHS ENDED DECEMBER 31, 2000 AND 1999


                                                 2000          1999
                                              ----------   ----------
Operating revenues
  Oil and gas sales                           $2,355,463   $1,316,078
  Well supervision fees and
   overhead reimbursements                        58,347       37,583
                                              ----------   ----------
                                               2,413,810    1,353,661
                                              ----------   ----------

Operating costs and expenses
  Production                                     915,896      376,764
  Depreciation, depletion and
   amortization                                  238,904       75,030
  General, administration and other              162,986       85,531
                                              ----------   ----------
                                               1,317,786      537,325
                                              ----------   ----------
     Earnings from operations                  1,096,024      816,336

Other income (loss)                               23,816       35,333
Interest expense                                (211,070)     (19,455)
                                              ----------   ----------
     Earnings before income taxes                908,770      832,214

Provision for income taxes                       309,001      250,176
                                              ----------   ----------
                                              $  599,769   $  582,038
                                              ==========   ==========

Net Earnings Per Share

  Basic                                       $      .12   $      .12
                                              ==========   ==========
  Diluted                                     $      .11   $      .12
                                              ==========   ==========

Weighted average common shares outstanding

  Basic                                        5,213,695    4,814,230
                                              ==========   ==========
  Diluted                                      5,255,941    4,996,364
                                              ==========   ==========


The accompanying notes are an integral part of these statements.

                                      5


                          PONTOTOC PRODUCTION, INC.
                       STATEMENTS OF CASH FLOWS-UNAUDITED
            FOR THE NINE MONTHS ENDED DECEMBER 30, 2000 AND 1999

                                                       2000         1999
                                                    ----------   ----------
Increase (Decrease) in Cash and Cash Equivalents

Cash flows from operating activities
  Net earnings                                       $2,403,925  $1,309,360
  Adjustments to reconcile net earnings to
  net cash provided by operating activities
   Depreciation, depletion and amortization             655,361     225,100
   Deferred income taxes                                 897,017        -

   Net (earnings) loss from investee                     34,064    (100,185)
   Non cash compensation                                 15,013        -
   Gain on sale of assets                                (2,485)       -
Change in assets and liabilities
  (Increase) decrease in:
   Accounts receivable, net                            (630,134)   (281,389)
   Other current assets                                  15,264      27,275
   Increase (decrease) in:
   Accounts payable                                      24,103      49,841
   Accrued and other current liabilities                193,911     (25,135)
   Income taxes payable                                (153,886)    560,274
                                                      ---------  ----------
     Net cash provided by operating activities        3,452,153   1,765,141

 Cash flows from investing activities
  Payment of note receivable affiliate                    7,800      55,500
  Purchase of property and equipment                   (363,348)   (318,945)
  Proceeds from sales of property and equipment          11,413        -
  Oil and gas property additions                     (2,130,105) (1,154,608)
  Oil and gas property dispositions                      15,000   1,052,050
  Purchase of business net of cash acquired          (9,999,980)       -
  Other                                                    -        (41,933)
                                                     ----------  ----------
     Net cash provided by (used in)
      investing activities                          (12,459,220)   (407,936)

Cash flows from financing activities
  Borrowing                                          12,788,713     277,076
  Repayment of borrowings                            (4,997,926) (1,875,288)
  Proceeds from exercise of stock options               146,250        -
  Sale of common stock, net of offering
   costs                                                   -        615,000
                                                     ----------   ---------
     Net cash provided by (used in)
      financing activities                            7,937,037    (983,212)

NET INCREASE (DECREASE)IN CASH AND CASH EQUIVALENTS  (1,070,030)    373,993

Cash and cash equivalents at beginning of period      1,773,797     271,170
                                                     ----------   ---------
Cash and cash equivalents at end of period            $ 703,767    $645,163
                                                     ==========   =========

      The accompanying notes are an integral part of these statements.
                                      6

Supplemental Cash Flow Information
Cash paid during the period for:
  Interest                                                $  476,942  $101,533
  Income taxes                                               428,261      -

Non-cash Investing Activities:

On June 1, 2000 the Company purchased all of the capital stock of Oklahoma
Basic Economy Corporation and the working interest of Oklahoma Basic Economy
Corporation's partner's for $10,000,000 in cash.

      Fair Market Value of assets acquired      $l4,611,105
      Less Liabilities assumed                   (4,611,125)
                                                 ----------
      Cash paid net of cash acquired            $ 9,999,980
                                                 ==========


The accompanying notes are an integral part of these statements.

                                      7



                           PONTOTOC PRODUCTION, INC.
                    NOTES TO FINANCIAL STATEMENTS - UNAUDITED
                               DECEMBER 31, 2000

NOTE A - NATURE OF OPERATIONS AND BASIS OF PRESENTATION

The major operations of Pontotoc Production, Inc. (the "Company") consist of
exploration, production, and sale of crude oil and natural gas in the United
States with an area of concentration in shallow reserves in the vicinity of
Pontotoc County, Oklahoma.  Other business segments are not a significant
factor in the Company's operation.

The interim financial statements included herein have been prepared by the
Company without audit. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted; however, the
Company believes that the disclosures are adequate to make the information
presented not misleading.  In the opinion of the Company, all adjustments
necessary to present fairly the financial position of Pontotoc Production,
Inc. as of December 31, 2000 and March 31, 2000, and the results of operations
and cash flows for the nine months ended December 31, 2000 and December 31,
1999, and results of operations for the three months ended December 31, 2000
and December 31, 1999, have been included and are of a normal, recurring
nature.  The results of operations for such interim periods are not
necessarily indicative of the results for the full year.  It is suggested that
these interim financial statements be read in conjunction with the Company's
March 31, 2000 audited financial statements.


                                      8


NOTE B- COMMON SHARES OUTSTANDING AND EARNINGS PER COMMON SHARE

The following reconciles earnings (numerator) and shares (denominator) used in
the computation of basic and diluted earnings per share:

                                              Nine Months Ended December 30
                                                 2000              1999
                                            ---------------  ----------------

Numerator
   Net Earnings                               $2,403,925        $1,309,360

Denominator
   Weighted average shares outstanding,
   basic                                       5,195,651         4,734,204

   Effect of dilutive securities
    Stock Options                                 38,193           199,323
                                              ----------         ---------
Denominator for earnings per share
assuming dilution                              5,233,844         4,933,527
                                              ----------         ---------
Earnings per share, basic                          $0.46             $0.28
                                              ----------         ---------

Earnings per share, assuming dilution              $0.46             $0.27
                                              ==========         =========

                                            Three Months Ended December 30
                                                 2000              1999
                                           ----------------  ----------------

Numerator
   Net Earnings                                 $599,769          $582,038

Denominator
   Weighted average shares outstanding,
   basic                                       5,213,695         4,814,230

   Effect of dilutive securities
    Stock Options                                 42,246           182,134
                                              ----------        ----------
Denominator for earnings per share
assuming dilution                              5,255,941         4,996,364
                                              ----------        ----------
Earnings per share, basic                          $0.12             $0.12
                                              ----------        ----------

Earnings per share, assuming dilution              $0.11             $0.12
                                              ==========        ==========


                                      9


NOTE C - ACQUISITIONS

On June 1, 2000, the Company closed on the acquisition of Oklahoma Basic
Economy Corporation ("OBEC") and the working interest of OBEC's partners for
$10,000,000.  Included in the purchase were interests in approximately 49 oil
and gas leases located in the following counties:  Pontotoc, Pottawatomie, and
Seminole.  The purchase also included two workover rigs, and miscellaneous
oilfield equipment that relates to the ongoing production of the oil and gas
properties.

The following presents unaudited pro forma results of operations for the nine
and three months ended December 31, 2000 and 1999 as if the acquisition had
been consummated immediately prior to April 1, 2000 and 1999.  These pro forma
results are not necessarily indicative of future results.

                                                    Pro Forma (Unaudited)
                                                  ------------------------
                                                      Nine Months Ended
                                                         December 30,
                                                      2000          1999
                                                   ----------    ----------

      Revenues                                     $8,109,794    $5,497,884
                                                   ==========    ==========
      Net Income                                   $2,588,653    $1,925,441
                                                   ==========    ==========
      Earnings per common share
       Basic                                       $      .50    $      .41
                                                   ==========    ==========
       Diluted                                     $      .49    $      .39
                                                   ==========    ==========


                                                      Three Months Ended
                                                          December 30,
                                                   -------------------------
                                                      2000          1999
                                                                  Pro Forma
                                                                 (Unaudited)
                                                   ----------    ----------

      Revenues                                     $2,413,810    $2,137,446
                                                   ==========    ==========
      Net Income                                   $  599,769    $  709,960
                                                   ==========    ==========
      Earnings per common share
       Basic                                       $      .12    $      .15
                                                   ==========    ==========
       Diluted                                     $      .11    $      .14
                                                   ==========    ==========



                                      10


NOTE D - SUBSEQUENT EVENTS

     On January 19, 2001,the Company entered into a definitive agreement and
plan of merger to be acquired by privately held Ascent Energy, Inc. through an
exchange offer.  Under the terms of the agreement, Ascent Energy will pay
consideration of $11.50 per share, consisting of $9.00 net in cash and Ascent
Energy convertible preferred stock having a liquidation value of $2.50 per
share.  The Ascent Energy stock will be convertible into 10% of the
outstanding common stock of Ascent Energy on a fully-diluted basis.  This
transaction is expected to be completed by the end of April, 2001.

     On January 30,2001 the Company announced that it has entered into a
binding letter of intent to acquire the remaining 55% interest in Pontotoc
Holdings, Inc.(PHI),the holding company for Pontotoc Gathering, LLC,from a
Director of the Company and two employees of PHI for 110,000 shares of the
Company's common stock.  This transaction is expected to close on or about
February 15, 2001, at which time PHI will become a wholly owned subsidiary of
the Company.

                                      11


                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                 OF THE CONSOLIDATED STATEMENTS OF OPERATIONS

RESULTS OF OPERATIONS - THREE MONTHS ENDED DECEMBER 31, 2000, COMPARED TO THE
THREE MONTHS ENDED DECEMBER 31, 1999

     Operating revenue for the three months ended December 31, 2000, increased
$1,060,149 (78%) from the comparable period of 1999 due to higher oil and gas
production and higher oil and gas prices.  On June 1, 2000, the Company closed
on the acquisition of OBEC and the working interests of OBEC's partners.
Included in the purchase were interests in approximately 49 oil and gas
leases. On October 2, 2000 the Company acquired interests in six oil and gas
properties from R.H.S. and C&L Drilling Co., Inc.

     Other income decreased $11,517 from the comparable period in 1999
primarily due to a decrease in the Company's share of revenue from their
investment in Pontotoc Gathering, LLC of $(55,727) offset by a gain from
speculative future hedging of $44,284.

     Production costs for the three months ended December 31, 2000, increased
$539,132 (143%) from the comparable period of 1999 due primarily to additional
oil and gas properties from OBEC, R.H.S. and C&L Drilling Co, Inc.

     Depreciation, depletion and amortization increased $163,874 (218%) as
compared to the same period in the prior year, due to additional oil and gas
properties and equipment acquired in the OBEC, R.H.S. and C&L Drilling Co.,
Inc. acquisitions.

     General and administrative costs increased $77,455 (91%) due to an
increase in salaries, investor relations, contract expenses and attorneys
fees.

     In late December due to subzero temperatures and an historic ice storm,
the Company was forced to curtail some or all of its oil and natural gas
production for approximately 12 days in December and 12 days in January. As of
February 2, 2001 the Company's production has been restored.  The loss in
production and the associated revenues for the months of December and January
will have a one time negative impact on our fiscal third and fourth quarter
numbers. However, these unusual circumstances have in no way effected our
ongoing acquisition and development programs.

RESULTS OF OPERATIONS - NINE MONTHS ENDED DECEMBER 31, 2000, COMPARED TO NINE
MONTHS ENDED DECEMBER 31, 1999

     Operating revenue for the nine months ended December 31, 2000, increased
$4,038,111 (119%) from the comparable period of 1999 due to higher oil and gas
production and an increase in oil prices.  On June 1, 2000 the Company closed
on the acquisition of OBEC and the working interests of OBEC's partners.
Included n the purchase were interests in approximately 49 oil and gas wells.
On October 2, 2000 the Company acquired interest in six oil and gas properties
from R.H.S. and C&L Drilling, Co., Inc.


                                       12


     Other income decreased $154,624 from the comparable period in 1999 due to
a decrease in the Company's share of revenue from their investment in Pontotoc
Gathering LLC of $(133,513)and a one time recognition of other income of
$(75,000) in 1999, offset by a gain from speculative futures hedging of
$44,284.

     Production costs for the nine months ended December 31, 2000, increased
$1,176,401(103%) due primarily to the additional oil and gas properties from
the OBEC, R.H.S. and C&L Drilling Co., Inc. acquisitions.

     Depreciation, depletion and amortization increased $430,261 (191%) as
compared to the same period in the prior year, due to increased oil and gas
production from the OBEC, R.H.S. and C&L Drilling Co. Inc. acquisitions.

     General and administrative costs for the nine months ended December 31,
2000, increased $193,118 (76%) due primarily to an increase in salaries,
investor relations, contract expenses and attorneys fees.

LIQUIDITY AND CAPITAL RESOURCES

     The Company's working capital was $993,834 at December 31, 2000, as
compared to $1,883,549 at March 31, 2000.  The decrease in working capital is
due to a decrease in cash that was used to reduce debt and an increase in
current liabilities.

     During the nine months ended December 31, 2000, cash generated by
operating activities was $3,452,153 compared to cash generated of $1,765,141
for the nine months ended December 31, 1999.  This increase in the amount of
cash generated was primarily due to the $1,094,565 increase in net earnings.

     Cash flows used in investing activities during the nine months ended
December 31, 2000, were $(12,459,220) compared to $(407,936) for the
comparable period of 1999.  During the first nine months of 2000, the Company
spent $2,130,105 on the purchase of additional oil and gas properties and
recompletions and $10,000,000 on the purchase of all of the outstanding stock
of OBEC and the working interest of OBEC's partners.  Also, the Company
purchased $363,348 of property and equipment.

     Cash flows from financing activities during the nine months ended
December 31, 2000 were $7,937,037 compared to $(983,212) used in financing
activities during the comparable period of 1999.  The Company borrowed
$12,788,713 and repaid $4,997,926 during the nine months ended September 30,
2000.  The borrowings were used to finance the acquisition of oil and gas
properties and other property and equipment.  The cash provided by operating
activities and $1,000,000 of cash on hand at March 31, 2000 was used for the
repayment of borrowings.


                                      13



                         PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

     None.

ITEM 2.  CHANGES IN SECURITIES.

     None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.

ITEM 5.  OTHER INFORMATION

     On January 19, 2001,the Company entered into a definitive agreement and
plan of merger to be acquired by privately held Ascent Energy, Inc. through an
exchange offer.  Under the terms of the agreement, Ascent Energy will pay
consideration of $11.50 per share, consisting of $9.00 net in cash and Ascent
Energy convertible preferred stock having a liquidation value of $2.50 per
share.  The Ascent Energy stock will be convertible into 10% of the
outstanding common stock of Ascent Energy on a fully-diluted basis.  This
transaction is expected to be completed by the end of April, 2001.

     On January 30,2001 the Company announced that it has entered into a
binding letter of intent to acquire the remaining 55% interest in Pontotoc
Holdings, Inc.(PHI),the holding company for Pontotoc Gathering, LLC,from a
Director of Pontotoc Productions Inc. and two employees of PHI for 110,000
shares of the Company's common stock.  This transaction is expected to close
on or about February 15, 2001, at which time PHI will become a wholly owned
subsidiary of the Company.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits.  None

     (b)  Reports on Form 8-K.  None



                                     14


                                  SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                    PONTOTOC PRODUCTION, INC.


Date:  February 13, 2000            By:/s/ James Robby Robson
                                       James Robby Robson, Jr.
                                        President



Date:  February 13, 2000            By:/s/ Todd Robson
                                       Todd Robson, Treasurer (Chief
                                       Financial and Accounting Officer)


                                       15

Annex E

CERTIFICATE OF DESIGNATIONS

of

8% SERIES B CONVERTIBLE PREFERRED STOCK

of

ASCENT ENERGY INC.

(Pursuant to Section 151(g) of the
Delaware General Corporation Law)

        Ascent Energy Inc., a corporation organized and existing under the laws of the State of Delaware (the "Company"), hereby certifies that the following resolution was duly adopted by the board of directors of the Company (the "Board of Directors") by unanimous written consent dated March 13, 2001, pursuant to Section 151(g) of the Delaware General Corporation Law:

        RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors in accordance with the provisions of the Certificate of Incorporation of the Company, the Board of Directors hereby creates a series of Preferred Stock, par value $0.001 per share, of the Company and hereby states the designation and number of shares, and fixes the relative rights, preferences and limitations thereof as follows:

        Section 1.         Designation and Amount. The shares of this series of Preferred Stock shall be designated as "8% Series B Convertible Preferred Stock" (the "Series B Convertible Preferred Stock") and the number of shares constituting the Series B Convertible Preferred Stock shall be 5,500,000. Such number of shares may be increased or decreased at any time by resolution of the Board of Directors; provided, however, no decrease shall reduce the number of shares of Series B Convertible Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights, or warrants for, or upon the conversion or exchange of, any outstanding securities issued by the Company convertible or exchangeable into, Series B Convertible Preferred Stock.

        Section 2.         Ranking. The Series B Convertible Preferred Stock shall rank, as to the payment of dividends and the distribution of the assets upon liquidation, dissolution or winding up of the Company: (a) on a parity with the Company's Series A Preferred Stock, par value $0.001 per share (the "Series A Preferred Stock") and the Company's Series C Convertible Preferred Stock, par value $0.001 per share (the "Series C Convertible Preferred Stock"), (b) senior to or on a parity with all other classes and series of the Company's preferred stock, and (c) senior to the Company's common stock, par value $0.001 per share ("Common Stock").

        Section 3.         Liquidation. Upon the voluntary or involuntary liquidation, winding up or dissolution of the Company (in connection with the bankruptcy or insolvency of the Company or otherwise), out of the assets available for distribution to shareholders, the holders of Series B Convertible Preferred Stock shall be entitled to receive, in preference to any payment or distribution to the holders of Common Stock or any other stock of the Company ranking junior to the Series B Convertible Preferred Stock, as to dividends, liquidation, dissolution or winding up, $2.50 per share (the "Preferred Liquidation Value") plus an amount equal to all Preferred Dividends (as defined in Section 4 below) (whether or not earned or declared) accrued and unpaid on each such share up to and including the date of final distribution to such holders. After the Preferred Liquidation Value and all accrued and unpaid Preferred Dividends have been paid on the Series B Convertible Preferred Stock, the remaining assets shall be paid to the holders of Common Stock and other junior classes of stock in accordance with their respective priority, if any. In the event the net assets of the Company are insufficient to pay the holders of the Series B Convertible Preferred Stock the full amount of their preference set forth above and the holders of any other series of capital stock of the Company ranking on a parity with the Series B Convertible Preferred Stock the liquidating payments to which they are entitled, then the remaining net assets of the Company shall be divided among and paid to the holders of the shares of Series B Convertible Preferred Stock and any such other capital stock of the Company ranking on a parity with the Series B Convertible Preferred Stock ratably per share in proportion to the full per share amounts to which they would be entitled if all amounts payable thereon were paid in full, and the holders of Common Stock and other junior classes of stock will receive nothing. Neither a merger or consolidation of the Company with or into any other corporation or entity nor the sale of all or substantially all of the assets of the Company shall be deemed to be a liquidation, dissolution or winding up within the meaning of this provision.

        Section 4.         Dividends. The Series B Convertible Preferred Stock is entitled to receive, out of legally available funds, preferential cumulative dividends from the issuance date thereof at the annual rate of eight percent (8%) of the Preferred Liquidation Value per share ("Preferred Dividends"). All Preferred Dividends, if declared by the Board of Directors, shall be payable quarterly and promptly after the tenth business day of each January, April, July and October of each year (each, a "Dividend Payment Date"), commencing on July 10, 2001, to holders of record on the record date, which the Board of Directors shall fix not more than sixty (60) days or less than ten (10) days preceding a Dividend Payment Date. Preferred Dividends shall cease to accrue on shares of Series B Convertible Preferred Stock on the Mandatory Conversion Date (as defined in Section 5 below) or on the date of their earlier conversion. No dividend shall be declared on any other series or class or classes of stock to which the Series B Convertible Preferred Stock ranks prior as to dividends or liquidation, in respect of any period, nor shall any shares of any such series or class be redeemed, purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series B Convertible Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. No dividend shall be declared on any other series or class or classes of stock ranking on a parity with the Series B Convertible Preferred Stock, as to dividends, in respect of any quarterly period, nor shall any shares of any such series or class be redeemed or purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series B Convertible Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. Preferred Dividends shall also be payable upon any Redemption Date (as defined in Section 7(a) below) and upon the final distribution date relating to the dissolution, liquidation or winding up of the Company. Preferred Dividends shall begin to accrue on outstanding shares of Series B Convertible Preferred Stock and to accumulate from the issuance date of such shares whether or not earned or declared, but Preferred Dividends for any period less than a full quarterly period between Dividend Payment Dates shall be computed on the basis of a 365–day year for the actual number of days elapsed. Preferred Dividends shall accrue whether or not there shall be (at the time any such dividend becomes payable or at any other time) profits, surplus or other funds of the Company legally available for the payment of dividends. Accumulations of dividends on shares of Series B Convertible Preferred Stock shall not bear interest.

        Section 5.         Conversion Rights.

                    (a)        Unless previously converted at the option of the holder into Common Stock in accordance with the provisions of Section 5(c) below, on the second anniversary of the date of issuance (the "Mandatory Conversion Date"), each outstanding share of Class B Convertible Preferred Stock will convert automatically (the "Mandatory Conversion") into a number of shares of Common Stock at the Conversion Rate (as defined below) in effect on the Mandatory Conversion Date and the holder thereof shall have the right to receive an amount in cash equal to all accrued and unpaid Preferred Dividends (whether or not earned or declared) on such share of Series B Convertible Preferred Stock (other than previously declared Preferred Dividends payable to a holder of record as of a prior date) to and including the Mandatory Conversion Date, whether or not declared, out of funds legally available for the payment of Preferred Dividends. The "Conversion Rate" is initially equal to 0.1878395 shares of Common Stock per share of Series B Convertible Preferred Stock. The Conversion Rate is subject to adjustment as set forth in Section 5(e).

                    (b)        Preferred Dividends on the shares of Series B Convertible Preferred Stock shall cease to accrue and such shares of Series B Convertible Preferred Stock shall cease to be outstanding on the Mandatory Conversion Date. The Company shall make such arrangements as it deems appropriate for the issuance of certificates representing shares of Common Stock and for the payment of cash in respect of accrued and unpaid Preferred Dividends on the Series B Convertible Preferred Stock, if any, in exchange for and contingent upon surrender of certificates representing the shares of Series B Convertible Preferred Stock, and the Company may defer the payment of dividends on such shares of Common Stock until, and make such payment contingent upon, the surrender of certificates representing the shares of Series B Convertible Preferred Stock; provided, that the Company shall give the holders of the shares of Series B Convertible Preferred Stock such notice of any such actions as the Company deems appropriate and upon such surrender such holders shall be entitled to receive such dividends declared and paid, if any, without interest, on such shares of Common Stock subsequent to the Mandatory Conversion Date.

                    (c)        Each share of Series B Convertible Preferred Stock is convertible, in whole or in part, at the option of the holder thereof ("Optional Conversion"), at any time prior to the Mandatory Conversion Date, into duly authorized, validly issued, fully paid and nonassessable shares of Common Stock at the Conversion Rate in effect on the date of conversion. Optional Conversion of shares of Series B Convertible Preferred Stock may be effected by delivering certificates evidencing such shares, together with written notice of conversion and proper assignment of such certificates to the Company or in blank to the office of any transfer agent for the shares of Series B Convertible Preferred Stock or to any other office or agency maintained by the Company for that purpose (the "Transfer Agent") and otherwise in accordance with reasonable Optional Conversion procedures established by the Company.

                    (d)        Holders of shares of Series B Convertible Preferred Stock at the close of business on a record date for any payment of declared Preferred Dividends shall be entitled to receive the Preferred Dividends so declared on such shares of Series B Convertible Preferred Stock on the corresponding Dividend Payment Date notwithstanding the Optional Conversion of such shares of Series B Convertible Preferred Stock following such record date and prior to such Dividend Payment Date. Except as provided above, upon any Optional Conversion of shares of Series B Convertible Preferred Stock, the Company shall make no payment of or allowance for unpaid Preferred Dividends, whether or not in arrears, on such shares of Series B Convertible Preferred Stock as to which Optional Conversion has been effected or previously declared dividends or distributions on the shares of Common Stock issued upon such Optional Conversion. As promptly as practicable after the surrender of the Series B Convertible Preferred Stock, the Company shall issue and deliver to such holder certificates for the number of shares of Common Stock issuable upon the conversion of such shares in accordance with the provisions hereof.

                    (e)         Adjustments to Conversion Rate. The Conversion Rate in effect from time to time for the Series B Convertible Preferred Stock shall be subject to adjustment in certain cases as follows:

                                (i)         Adjustments for Subdivisions, Combinations or Consolidation of Common Stock. In the event the outstanding shares of Common Stock shall be subdivided, by stock dividend, stock split or otherwise, into a greater number of shares of Common Stock, the Conversion Rate applicable to the Series B Convertible Preferred Stock then in effect shall, concurrently with the effectiveness of such subdivision, be proportionately increased. In the event the outstanding shares of Common Stock shall be combined or consolidated, by reclassification or otherwise, into a lesser number of shares of Common Stock, the Conversion Rate applicable to the Series B Convertible Preferred Stock then in effect shall, concurrently with the effectiveness of such combination or consolidation, be proportionately decreased.

                                (ii)         Adjustments for Reclassification, Exchange and Substitution. If the Common Stock issuable upon conversion of the Series B Convertible Preferred Stock shall be changed into the same or a different number of shares of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision, combination or consolidation of shares provided for in Section 5(e)(i) above), the Conversion Rate then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted such that the Series B Convertible Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders would otherwise have been entitled to receive, a number of shares of such other class or classes of stock equivalent to the number of shares of Common Stock that would have been subject to receipt by the holders upon conversion of the Series B Convertible Preferred Stock immediately before that change, subject to further adjustment as provided in this Section 5.

                                (iii)         Before taking any action that would cause an adjustment reducing the Conversion Rate below the then par value of the shares of Common Stock deliverable upon conversion of the shares of Series B Convertible Preferred Stock, the Company will take any corporate action which may be necessary in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock at such adjusted Conversion Rate.

                    (f)         Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Rate pursuant to this Section 5, the Company, at its expense, shall promptly compute such adjustment or readjustment in accordance with the terms hereof and deliver to the Transfer Agent a certificate setting forth such adjustment or readjustment and setting forth a brief statement of the facts requiring such adjustment or readjustment. Promptly after delivery of such certificate, the Company shall prepare and mail a notice to each holder of Series B Convertible Preferred Stock at such holder's last address as it appears on the transfer books of the Company, which notice shall set forth the new Conversion Rate and a brief statement of the facts requiring the adjustment or readjustment, including the computation of the new Conversion Rate.

                    (g)         Fractional Shares. No fractional shares of Common Stock shall be issued upon conversion of the Series B Convertible Preferred Stock, and the number of shares of Common Stock to be issued shall be rounded up to the nearest whole share. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series B Convertible Preferred Stock by a holder thereof shall be aggregated for purposes of determining whether the conversion would result in the issuance of any fractional share.

                    (h)         No Impairment. The Company will not, by amendment of its Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company but will at all times in good faith assist in the carrying out of all the provisions of this Section 5 and take all such action as may be necessary or appropriate in order to protect the conversion rights of the holders of the Series B Convertible Preferred Stock against impairment.

                    (i)         Reservation of Common Stock Issuable upon Conversion. The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock solely for issuance upon the conversion of shares of Series B Convertible Preferred Stock as herein provided, such number of shares of Common Stock as, from time to time, shall be issuable upon the conversion of all the shares of the Series B Convertible Preferred Stock at the time outstanding. All shares of Common Stock issuable upon the conversion of shares of the Series B Convertible Preferred Stock shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable.

                    (j)         Fundamental Change Transaction. In case at any time after the original issuance of shares of Series B Convertible Preferred Stock, the Company shall be a party to any transaction (including a merger, consolidation, statutory share exchange, sale of all or substantially all of the Company's assets or recapitalization of the Common Stock), in each case as a result of which shares of Common Stock (or any other securities of the Company then issuable upon conversion of the Series B Convertible Preferred Stock) shall be converted into the right to receive stock, securities or other property (including cash or any combination thereof) (each of the foregoing transactions being referred to as a "Fundamental Change Transaction"), then, lawful and fair provision shall be made whereby the shares of Series B Convertible Preferred Stock shall, immediately prior to the consummation of the Fundamental Change Transaction, convert and the holders of such shares of Series B Convertible Preferred Stock shall have the right to receive, upon the basis and upon the terms and conditions specified in connection with such Fundamental Change Transaction and in lieu of the shares of Common Stock receivable upon the conversion of such shares, such shares of stock, securities or other property (including cash or any combination thereof) as may be issued or payable with respect to or in exchange for the number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore receivable upon the conversion of shares of Series B Convertible Preferred Stock, had such Fundamental Change Transaction not taken place, plus the cash payment described in Section 5(a) hereof. The Company shall not effect any Fundamental Change Transaction unless prior to the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation or merger, or the corporation purchasing such assets, shall assume by written instrument the obligation to deliver to the holders of Series B Convertible Preferred Stock such shares of stock, securities, or assets as such holder would be entitled to acquire in accordance with the foregoing provisions. In the event that, at any time, as a result of an adjustment made pursuant to other provisions of this Section 5, the Series B Convertible Preferred Stock shall become subject to conversion into any securities other than shares of Common Stock, thereafter the number of such other securities so issuable upon conversion of the shares of Series B Convertible Preferred Stock shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the shares of Series B Convertible Preferred Stock contained in this Section 5(j).

                    (k)         Notices. In case at any time:

                                (i)         the Company shall declare or pay to all holders of Common Stock any dividend (whether payable in Common Stock, cash, securities or other property);

                                (ii)         there shall be any capital reorganization, or reclassification of the Common Stock of the Company, or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation or other entity;

                                (iii)         there shall be a voluntary or involuntary dissolution, liquidation or winding–up of the Company;

                                (iv)         there shall be any other Fundamental Change Transaction; or

                                (v)         there shall occur any other event that would cause an adjustment to the Conversion Rate of the Series B Convertible Preferred Stock;

then, in any one or more of such cases, the Company shall give to each holder of shares of Series B Convertible Preferred Stock: (A) at least twenty (20) days prior to any such event, written notice of the date on which the books of the Company shall close or records shall be taken for such dividend or distribution or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction; and (B) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction known to the Company, at least thirty (30) days prior written notice of the date (or if not then known, a reasonable approximation thereof by the Company) when the same shall take place. Such notice in accordance with the foregoing clause (A) shall also specify, in the case of any such dividend or distribution, the date on which such holders of Common Stock shall be entitled thereto. Such notice in accordance with the foregoing clause (B) shall also specify the date on which such holders of Common Stock shall be entitled to receive their shares of stock, securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation, winding–up or Fundamental Change Transaction, as the case may be.

                    (l)         Initial Public Offering. In case at any time after the original issuance of shares of Series B Convertible Preferred Stock, the Company shall consummate an Initial Public Offering (as defined below), the shares of Series B Convertible Preferred Stock shall immediately prior to the consummation of the Initial Public Offering convert in accordance with the terms set forth in Sections 5(a) and (b) hereof. The Company shall provide each holder of shares of Series B Convertible Preferred Stock with reasonable notice of such Initial Public Offering and the arrangements made pursuant to Section 5(b) hereof. For purposes hereof, an "Initial Public Offering" shall mean a firm commitment, underwritten public offering of Common Stock of the Company registered under the Securities Act of 1933, as amended (the "Securities Act"), other than a registration relating solely to a transaction under Rule 145 promulgated under the Securities Act or to an employee benefit plan of the Company, that results in such Common Stock being listed on the New York Stock Exchange, the American Stock Exchange or quoted for trading on the Nasdaq National Market tier of the Nasdaq Stock Market or any of their respective successors.

        Section 6.         Voting Rights.

                    (a)         Except as set forth below or as otherwise provided by Delaware law, holders of shares of Series B Convertible Preferred Stock shall not be entitled to vote such shares; provided, that in all cases where the holders of shares of Series B Convertible Preferred Stock have the right to vote such shares, such holders shall be entitled to one vote for each such share held by them.

                    (b)         Without the affirmative vote of the holders of not less than a majority of the shares of Series B Convertible Preferred Stock outstanding, voting together as a single class, the Company shall not amend or waive any of the provisions of the Certificate of Incorporation or this Certificate of Designations, which would materially and adversely affect any right, preference or privilege of the Series B Convertible Preferred Stock or of the holders thereof; provided, however, that any increase in the amount of authorized Preferred Stock or the creation and/or issuance of other series of Preferred Stock, in each case ranking on a parity with or junior to the Series B Convertible Preferred Stock, shall not be deemed to materially and adversely affect such rights, preferences or privileges and shall not require the consent of the holders of the then outstanding Series B Convertible Preferred Stock; and provided further, that the authorization and/or issuance of additional shares of Series B Convertible Preferred Stock and/or the creation and/or issuance of other series or classes of preferred stock ranking prior to the Series B Convertible Preferred Stock shall be deemed to materially and adversely affect such rights, preferences and privileges.

        Section 7.         Redemption.

                    (a)        The Company shall have the right, at any time and from time to time, on and after the date of issuance, and at its sole option and election, to redeem the shares of Series B Convertible Preferred Stock, in whole or in part, on such date as may be specified in a notice of redemption given as provided in Section 7(b) below (any such date a "Redemption Date") at a cash price per share (the "Redemption Price") equal to 100% of the Preferred Liquidation Value plus an amount equal to all Preferred Dividends (whether or not earned or declared) accrued and unpaid on each such share up to and including the date fixed for redemption, in immediately available funds. The Company shall not be required to establish any sinking or retirement fund with respect to the shares of Series B Convertible Preferred Stock.

                    (b)        Notice of any redemption of shares of Series B Convertible Preferred Stock pursuant to Section 7(a) above shall be mailed at least twenty (20) but not more than sixty (60) days prior to the applicable Redemption Date to the Transfer Agent for the shares of Series B Convertible Preferred Stock and each holder of the shares of Series B Convertible Preferred Stock to be redeemed, at such holder's last address as it appears on the transfer books of the Company. Failure to mail such notice, or any defect therein or in the mailing thereof, to any particular holder shall not affect the validity of the proceeding for the redemption of any shares so to be redeemed from any other holder. In order to facilitate the redemption of shares of Series B Convertible Preferred Stock, the Board of Directors may fix a record date for the determination of shares of Series B Convertible Preferred Stock to be redeemed, or may cause the transfer books of the Company for the Series B Convertible Preferred Stock to be closed, not more than sixty (60) days or less than twenty (20) days prior to the applicable Redemption Date.

                    (c)         If less than all the outstanding shares of Series B Convertible Preferred Stock are to be redeemed, the number of shares of Series B Convertible Preferred Stock to be redeemed shall be as determined by the Board of Directors. Any such partial redemption shall be effected on a pro rata basis.

                    (d)        Notice of redemption having been given as provided in Section 7(b) above, notwithstanding that any certificates for such shares shall not have been surrendered for cancellation, from and after the Redemption Date designated in the notice of redemption (i) the shares represented thereby shall no longer be deemed outstanding, (ii) the rights to receive dividends thereon shall cease to accrue and (iii) all rights of the holders of shares of Series B Convertible Preferred Stock to be redeemed shall cease and terminate, excepting only the right to receive the Redemption Price therefor and the right to convert such shares into shares of Common Stock until the close of business on such Redemption Date, in accordance with Section 5 hereof.

                    (e)         Notwithstanding the foregoing, if notice of redemption has been given pursuant to Section 7(b) above and any holder of the Series B Convertible Preferred Stock shall, before the close of business on the business day preceding the Redemption Date, give notice to the Company pursuant to Section 5(c) above of the conversion of any or all of the shares to be redeemed which are held by that holder, then (i) the Company shall not have the right to redeem those shares for which the conversion notice has been given, (ii) the holder shall not be entitled to payment of the Redemption Price with respect to those shares, (iii) the conversion of those shares shall become effective as provided in Section 5 above, and (iv) any funds that have been deposited for the payment of the Redemption Price of those shares shall be returned to the Company immediately after such conversion.

        Section 8.         Reacquired Shares. Any shares of Series B Convertible Preferred Stock converted, exchanged, redeemed, purchased or otherwise acquired by the Company in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock without designation as to series and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors as permitted by the Certificate of Incorporation or as otherwise permitted under Delaware law.

        Section 9.         Preemptive Rights. Except as provided herein, the Series B Convertible Preferred Stock is not entitled to any preemptive rights in respect of any securities of the Company.

        Section 10.       Severability of Provisions. Whenever possible, each provision hereof shall be interpreted in a manner as to be effective and valid under applicable law, but if any provision hereof is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining provisions hereof. If a court of competent jurisdiction should determine that a provision hereof would be valid or enforceable if a period of time were extended or shortened or a particular percentage were increased or decreased, then such court may make such change as shall be necessary to render the provision in question effective and valid under applicable law.

        Section 11.       Replacement. Upon receipt of evidence satisfactory to the Company (an affidavit of the registered holder shall be satisfactory) of the ownership and the loss, theft, destruction or mutilation of any certificate evidencing shares of Series B Convertible Preferred Stock, and, in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company (provided, that, if the holder is a financial institution or other institutional investor, its own agreement shall be satisfactory), or, in the case of any such mutilation, upon surrender of such certificate, the Company shall execute and deliver in lieu of such certificate a new certificate of like kind representing the number of shares of Series B Convertible Preferred Stock of such class represented by such lost, stolen, destroyed or mutilated certificate and dated the date of the lost, stolen, destroyed or mutilated certificate, and dividends shall accrue on the Series B Convertible Preferred Stock represented by such new certificate from the date to which dividends have been fully paid on the Series B Convertible Preferred Stock represented by the lost, stolen, destroyed or mutilated certificate.

        Section 12.        Successors and Transferees. The provisions applicable to shares of Series B Convertible Preferred Stock shall bind and inure to the benefit of and be enforceable by the Company, the respective successors to the Company, and by any record holder of shares of Series B Convertible Preferred Stock.

        IN WITNESS WHEREOF, Ascent Energy Inc. has caused this Certificate of Designations to be signed by the undersigned on this 13th day of March, 2001.

                                                                                              ASCENT ENERGY INC.

                                                                                              By:         /s/ Jeffrey Clarke             
                                                                                                             Jeffrey Clarke
                                                                                                              President

Annex F

NEVADA REVISED STATUTES

Section 92A.300. Definitions

        As used in NRS 92A.300 to 92A.500, inclusive, unless the context otherwise requires, the words and terms defined in NRS 92A.305 to 92A.335, inclusive, have the meanings ascribed to them in those sections.

Section 92A.305. "Beneficial stockholder" defined

        "Beneficial stockholder" means a person who is a beneficial owner of shares held in a voting trust or by a nominee as the stockholder of record.

Section 92A.310. "Corporate action" defined

        "Corporate action" means the action of a domestic corporation.

Section 92A.315. "Dissenter" defined

        "Dissenter" means a stockholder who is entitled to dissent from a domestic corporation's action under NRS 92A.380 and who exercises that right when and in the manner required by NRS 92A.400 to 92A.480, inclusive.

Section 92A.320. "Fair value" defined

        "Fair value," with respect to a dissenter's shares, means the value of the shares immediately before the effectuation of the corporate action to which he objects, excluding any appreciation or depreciation in anticipation of the corporate action unless exclusion would be inequitable.

Section 92A.325. "Stockholder" defined

        "Stockholder" means a stockholder of record or a beneficial stockholder of a domestic corporation.

Section 92A.330. "Stockholder of record" defined

        "Stockholder of record" means the person in whose name shares are registered in the records of a domestic corporation or the beneficial owner of shares to the extent of the rights granted by a nominee's certificate on file with the domestic corporation.

Section 92A.335. "Subject corporation" defined

        "Subject corporation" means the domestic corporation which is the issuer of the shares held by a dissenter before the corporate action creating the dissenter's rights becomes effective or the surviving or acquiring entity of that issuer after the corporate action becomes effective.

Section 92A.340. Computation of interest

        Interest payable pursuant to NRS 92A.300 to 92A.500, inclusive, must be computed from the effective date of the action until the date of payment, at the average rate currently paid by the entity on its principal bank loans or, if it has no bank loans, at a rate that is fair and equitable under all of the circumstances.

Section 92A.350. Rights of dissenting partner of domestic limited partnership

        A partnership agreement of a domestic limited partnership or, unless otherwise provided in the partnership agreement, an agreement of merger or exchange, may provide that contractual rights with respect to the partnership interest of a dissenting general or limited partner of a domestic limited partnership are available for any class or group of partnership interests in connection with any merger or exchange in which the domestic limited partnership is a constituent entity.

Section 92A.360. Rights of dissenting member of domestic limited liability company

        The articles or organization or operating agreement of a domestic limited liability company or, unless otherwise provided in the articles of organization or operating agreement, an agreement of merger or exchange, may provide that contractual rights with respect to the interest of a dissenting member are available in connection with any merger or exchange in which the domestic limited liability company is a constituent entity.

Section 92A.370. Rights of dissenting member of domestic nonprofit corporation

        1.   Except as otherwise provided in subsection 2 and unless otherwise provided in the articles or bylaws, any member of any constituent domestic nonprofit corporation who voted against the merger may, without prior notice, but within 30 days after the effective date of the merger, resign from membership and is thereby excused from all contractual obligations to the constituent or surviving corporations which did not occur before his resignation and is thereby entitled to those rights, if any, which would have existed if there had been no merger and the membership had been terminated or the member had been expelled.

        2.   Unless otherwise provided in its articles of incorporation or bylaws, no member of a domestic nonprofit corporation, including, but not limited to, a cooperative corporation, which supplies services described in chapter 704 of NRS to its members only, and no person who is a member of a domestic nonprofit corporation as a condition of or by reason of the ownership of an interest in real property, may resign and dissent pursuant to subsection 1.

Section 92A.380. Right of stockholder to dissent from certain corporate actions and to obtain payment for shares

        1.   Except as otherwise provided in NRS 92A.370 to 92A.390, a stockholder is entitled to dissent from, and obtain payment of the fair value of this shares in the event of any of the following corporate actions:

(a) Consummation of a plan of merger to which the domestic corporation is a party:

 

(1)	If approval by the stockholders is required for the merger by NRS 92A.120 to 92A.160, inclusive, or the articles of incorporation and he is entitled to vote on the merger; or
(2)	If the domestic corporation is a subsidiary and is merged with its parent under NRS 92A.180.

 

(b)	Consummation of a plan of exchange to which the domestic corporation is a party as the corporation whose subject owner's interests will be acquired, if he is entitled to vote on the plan.
(c)	Any corporate action taken pursuant to a vote of the stockholders to the event that the articles of incorporation, bylaws or a resolution of the board of directors provides that voting or nonvoting stockholders are entitled to dissent and obtain payment for their shares.

            2.  A stockholder who is entitled to dissent and obtain payment under NRS 92A.300 to 92A.500, inclusive, may not challenge the corporate action creating his entitlement unless the action is unlawful or fraudulent with respect to him or the domestic corporation.

Section 92A.390. Limitations on right of dissent: Stockholders of certain classes or series; action of stockholders not required for plan of merger

        1.     There is no right of dissent with respect to a plan of merger or exchange in favor of stockholders of any class or series which, at the record date fixed to determine the stockholders entitled to receive notice of and to vote at the meeting at which the plan of merger or exchange is to be acted on, were either listed on a national securities exchange, included in the national market system by the National Association  of Securities Dealers, Inc., or held by at least 2,000 stockholders of records, unless:

(a)	The articles of incorporation of the corporation issuing the shares provide otherwise; or
(b)	the holders of the class or series are required under the plan of merger or exchange to accept for the shares anything except:

(1) Cash, owner's interests or owner's interests and cash in lieu of fractional owner's interests of:

(I)	The surviving or acquiring entity; or
(II)	any other entity which, at the effective date of the plan of merger or exchange, were either listed on a national securities exchange, included in the national market system by the National Association of Securities Dealers, Inc., or held of record by at least 2,000 holders of owner's interests of record; or

(2) A combination of cash and owner's interests of the kind described in sub–subparagraphs (I) and (II) of subparagraph (1) of paragraph (b).

        2.     There is no right of dissent for any holders of stock of the surviving domestic corporation if the plan of merger does not require action of the stockholders of the surviving domestic corporation under NRS 92A.130.

Section 92A.400. Limitations on right of dissent: Assertion as to portions only to shares registered to stockholder; assertion by beneficial stockholder

        1.     A stockholder of record may assert dissenter's rights as to fewer than all of the shares registered in his name only if he dissents with respect to all shares beneficially owned by any one person and notifies the subject corporation in writing of the name and address of each person on whose behalf he asserts dissenter's rights. The rights of a partial dissenter under this subsection are determined as if the shares as to which he dissents and his other shares were registered in the names of different stockholders.

        2.     A beneficial stockholder may assert dissenter's rights as to shares held on his behalf only if:

(a)	He submits to the subject corporation the written consent of the stockholder of record to the dissent not later than the time the beneficial stockholder asserts dissenter's rights; and
(b)	He does so with respect to all shares of which he is the beneficial stockholder or over which he has power to direct the vote.

Section 92A.410. Notification of stockholders regarding right of dissent

        1.     If a proposed corporate action creating dissenters' rights is submitted to a vote at a stockholders' meeting, the notice of the meeting must state that stockholders are or may be entitled to assert dissenters' rights under NRS 92A.300 to 92A.500, inclusive, and be accompanied by a copy of those sections.

        2.     If the corporate action creating dissenters' rights is taken by written consent of the stockholders or without a vote of the stockholders, the domestic corporation shall notify in writing all stockholders entitled to assert dissenters' rights that the action was taken and send them the dissenter's notice described in NRS 92A.430.

Section 92A.420. Prerequisites to demand for payment for shares

        1.     If a proposed corporate action creating dissenters' rights is submitted to a vote at a stockholders' meeting, a stockholder who wishes to assert dissenter's rights:

(a)	Must deliver to the subject corporation, before the vote is taken, written notice of his intent to demand payment for his shares if the proposed action is effectuated; and
(b)	Must not vote his shares in favor of the proposed action.

        2.     A stockholder who does not satisfy the requirements of subsection 1 and NRS 92A.400 is not entitled to payment for his shares under this chapter.

Section 92A.430. Dissenter's notice: Delivery to stockholders entitled to assert rights; contents

        1.    If a proposed corporate action creating dissenters' rights is authorized at a stockholders' meeting, the subject corporation shall deliver a written dissenter's notice to all stockholders who satisfied the requirements to assert those rights.

        2.    The dissenter's notice must be sent no later than 10 days after the effectuation of the corporate action, and must:

(a)	State where the demand for payment must be sent and where and when certificates, if any, for shares must be deposited;
(b)	Inform the holders of shares not represented by certificates to what extent the transfer of the shares will be restricted after the demand for payment is received;
(c)	Supply a form for demanding payment that includes the date of the first announcement to the news media or to the stockholders of the terms of the proposed action and requires that the person asserting dissenter's rights certify whether or not he acquired beneficial ownership of the shares before that date;
(d)	Set a date by which the subject corporation must receive the demand for payment, which may not be less than 30 nor more than 60 days after the date the notice is delivered; and
(e)	Be accompanied by a copy of NRS 92A.300 to 92A.500, inclusive.

Section 92A.440. Demand for payment and deposit of certificates; retention of rights of stockholder

1. A stockholder to whom a dissenter's notice is sent must:

(a)	Demand payment;
(b)	Certify whether he acquired beneficial ownership of the shares before the date required to be set forth in the dissenter's notice for this certification; and
(c)	Deposit his certificates, if any, in accordance with the terms of the notice.

        2.    The stockholder who demands payment and deposits his certificates, if any, before the proposed corporate action is taken retains all other rights of a stockholder until those rights are canceled or modified by the taking of the proposed corporate action.

        3.    The stockholder who does not demand payment or deposit his certificates where required, each by the date set forth in the dissenter's notice, is not entitled to payment for his shares under this chapter.

Section 92A.450. Uncertificated shares: Authority to restrict transfer after demand for payment; retention of rights of stockholder

        1.     The subject corporation may restrict the transfer of shares not represented by a certificate from the date the demand for their payment is received.

        2.     The person for whom dissenter's rights are asserted as to shares not represented by a certificate retains all other rights of a stockholder until those rights are canceled or modified by the taking of the proposed corporate action.

Section 92A.460. Payment for shares: General requirements

        1.     Except as otherwise provided in NRS 92A.470, within 30 days after receipt of a demand for payment, the subject corporation shall pay each dissenter who complied with NRS 92A.440 the amount the subject corporation estimates to be the fair value of his shares, plus accrued interest. The obligation of the subject corporation under this subsection may be enforced by the district court:

(a)	Of the county where the corporation's registered office is located; or
(b)	At the election of any dissenter residing or having its registered office in this state, of the county where the dissenter resides or has its registered office. the court shall dispose of the complaint promptly.

        2.    The payment must be accompanied by:

(a)	the subject corporation's balance sheet as of the end of a fiscal year ending not more than 16 months before the date of payment, a statement of income for that year, a statement of changes in the stockholders' equity for that year and the latest available interim financial statements, if any;
(b)	A statement of the subject corporation's estimate of the fair value of the shares;
(c)	An explanation of how the interest was calculated;
(d)	A statement of the dissenter's rights to demand payment under NRS 92A.480; and
(e)	copy of NRS 92A.300 to 92A.500, inclusive.

Section 92A.470. Payment for shares: Shares acquired on or after date of dissenter's notice

        1.     A subject corporation may elect to withhold payment from a dissenter unless he was the beneficial owner of the shares before the date set forth in the dissenter's notice as the date of the first announcement to the news media or to the stockholders of the terms of the proposed action.

        2.     To the extent the subject corporation elects to withhold payment, after taking the proposed action, it shall estimate the fair value of the shares, plus accrued interest, and shall offer to pay this amount to each dissenter who agrees to accept it in full satisfaction of his demand. The subject corporation shall send with its offer a statement of its estimate of the fair value of the shares, an explanation of how the interest was calculated, and a statement of the dissenters' right to demand payment pursuant to NRS 92A.480.

Section 92A.480. Dissenter's estimate of fair value: Notification of subject corporation; demand for payment of estimate

        1.     A dissenter may notify the subject corporation in writing of his own estimate of the fair value of his shares and the amount of interest due, and demand payment of his estimate, less any payment pursuant to NRS 92A.460, or reject the offer pursuant to NRS 92A.470 and demand payment of the fair value of his shares and interest due, if he believes that the amount paid pursuant to NRS 92A.460 or offered pursuant to NRS 92A.470 is less than the fair value of his shares or that the interest due is incorrectly calculated.

        2.     A dissenter waives his right to demand payment pursuant to this section unless he notifies the subject corporation of his demand in writing within 30 days after the subject corporation made or offered payment for his shares.

Section 92A.490. Legal proceeding to determine fair value: Duties of subject corporation; powers of court; rights of dissenter

        1.     If a demand for payment remains unsettled, the subject corporation shall commence a proceeding within 60 days after receiving the demand and petition the court to determine the fair value of the shares and accrued interest. If the subject corporation does not commence the proceeding within the 60–day period, it shall pay each dissenter whose demand remains unsettled the amount demanded.

        2.     A subject corporation shall commence the proceeding in the district court of the county where it is registered office is located. If the subject corporation is a foreign entity without a resident agent in the state, it shall commence the proceeding in the county where the registered office of the domestic corporation merged with or whose shares were acquired by the foreign entity was located.

        3.     The subject corporation shall make all dissenters, whether or not residents of Nevada, whose demands remain unsettled, parties to the proceeding as in an action against their shares. All parties must be served with a copy of the petition. Nonresidents may be served by registered or certified mail or by publication as provided by law.

        4.     The jurisdiction of the court in which the proceeding is commenced under subsection 2 is plenary and exclusive. The court may appoint one or more persons as appraisers to receive evidence and recommend a decision on the question of fair value. The appraisers have the powers described in the order appointing them, or any amendment thereto. The dissenters are entitled to the same discovery rights as parties in other civil proceedings.

        5.     Each dissenter who is made a party to the proceeding is entitled to a judgment:

(a)	For the amount, if any, by which the court finds the fair value of his shares, plus interest, exceeds the amount paid by the subject corporation; or
(b)	For the fair value, plus accrued interest, of his after–acquired shares for which the subject corporation elected to withhold payment pursuant to NRS 92A.470.

Section 92A.500. Legal proceeding to determine fair value: Assessment of costs and fees

        1.    The court in a proceeding to determine fair value shall determine all of the costs of the proceeding, including the reasonable compensation and expenses of any appraisers appointed by the court. The court shall assess the costs against the subject corporation, except that the court may assess costs against all or some of the dissenters, in amounts the court finds equitable, to the extent the court finds the dissenters acted arbitrarily, vexatiously or not in good faith in demanding payment.

        2.     The court may also assess the fees and expenses of the counsel and experts for the respective parties, in amounts the court finds equitable:

(a)	Against the subject corporation and in favor of all dissenters if the court finds the subject corporation did not substantially comply with the requirements of NRS 92A.300 to 92A.500, inclusive; or
(b)	Against either the subject corporation or a dissenter in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously or not in good faith with respect to the rights provided by NRS 92A.300 to 92A.500, inclusive.

        3.     If the court finds that the services of counsel for any dissenter were of substantial benefit to other dissenters similarly situated, and that the fees for those services should not be assessed against the subject corporation, the court may award to those counsel reasonable fees to be paid out of the amounts awarded to the dissenters who were benefited.

        4.     In a proceeding commenced pursuant to NRS 92A.460, the court may assess the costs against the subject corporation, except that the court may assess costs against all or some of the dissenters who are parties to the proceeding, in amounts the court finds equitable, to the extent the court finds that such parties did not act in good faith in instituting the proceeding.

        5.     This section does not preclude any party in a proceeding commenced pursuant to NRS 92A.460 to 92A.490 from applying the provisions of N.R.C.P. 68 or NRS 17.115.

PART II

 INFORMATION NOT REQUIRED IN PROSPECTUS

 Item 20. 

Indemnification of Directors and Officers.

         Exculpation. Section 102(b)(7) of the Delaware General Corporation Law (the "DGCL") permits a corporation to include in its certificate of incorporation a provision eliminating or limiting the personal liability of a director to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, provided that such provision may not eliminate or limit the liability of a director for any breach of the director's duty of loyalty to the corporation or its stockholders, for acts or omissions that are not in good faith or that involve intentional misconduct or a knowing violation of law, for the payment of unlawful dividends, or for any transaction from which the director derived an improper personal benefit. Our certificate of incorporation limits the personal liability of a director to us and our stockholders for monetary damages for a breach of fiduciary duty as a director to the fullest extent permitted by law.

         Indemnification. Section 145 of the DGCL permits a corporation to indemnify any of its directors, officers, employees or agents who was or is a party, or is threatened to be made a party to any third party proceeding by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or firm, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, if such person acted in good faith and in a manner such person reasonably believed to be in and not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reason to believe that such person's conduct was unlawful. In a derivative action, i.e., one by or in the right of a corporation, the corporation is permitted to indemnify any of its directors, officers, employees or agents against expenses (including attorneys' fees) actually and reasonably incurred by the person in connection with the defense or settlement of an action or suit if the person acted in good faith and in a manner that he or she reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made if such person shall have been adjudged liable to the corporation, unless and only to the extent that the court in which the action or suit was brought shall determine upon application that such person is fairly and reasonably entitled to indemnity for such expenses despite the adjudication of liability. Our bylaws provide for indemnification of directors, officers, employees or agents for any liability incurred in their official capacity to the fullest extent permissible under DGCL.

            Insurance. We maintain liability policies to indemnify our officers and directors against loss arising from claims by reason of their legal liability for acts as officers and directors, subject to limitations and conditions set forth in the policies.

            Indemnity Agreements. Our certificate of incorporation provides that our board of directors may cause us to enter contracts, providing for indemnification of our directors and officers to the fullest extent permitted by law. We have entered into indemnity agreements, a form of which is filed as Exhibit 10.3, with each of our directors, which provide for indemnification of our directors.

         Merger Agreement. Under the merger agreement, we have agreed to fulfill and honor the obligations of Pontotoc pursuant to indemnification agreements between Pontotoc and its directors and officers as of the effective time of the merger and any indemnification provisions under Pontotoc's articles of incorporation and bylaws as in effect on the date of the merger agreement or at the effective time of the merger. The merger agreement also provides that the articles of incorporation and bylaws of the surviving corporation in the merger will contain provisions with respect to exculpation and indemnification that are at least as favorable to the indemnified parties as those contained in the articles of incorporation and bylaws of Pontotoc as in effect on the date of merger agreement, which provisions will not be amended, repealed or otherwise modified for a period of three years from the effective time of the merger in any manner that would adversely affect the rights thereunder of individuals who, immediately prior to the effective time of the merger, were directors, officers, employees or agents of Pontotoc, unless such modification is required by law.

         In addition, for a period of the lesser of five years from the effective time of the merger or the applicable statute of limitations, we have agreed to either (a) cause the surviving corporation in the merger to maintain directors' and officers' liability insurance for each person covered by Pontotoc's directors' and officers' liability insurance policy on the date of the merger agreement on terms comparable to those applicable to the directors and officers of Pontotoc as of the date of the merger agreement, except that we will be obligated to pay premiums for such insurance only up to 150% of the annual premiums paid by Pontotoc for such coverage as of the date of the merger agreement, or (b) if mutually agreed between Pontotoc and us, purchase directors' and officers' liability insurance on terms comparable to those applicable to the directors and officers of Pontotoc covering all periods prior to the effective time of the merger.

 Item 21. Exhibits and Financial Statement Schedules.

(a)    List of Exhibits.

Exhibit Number	Description
2	Agreement and Plan of Merger dated as of January 19, 2001 among Ascent Energy, Pontotoc Acquisition and Pontotoc*
3.1	Certificate of Incorporation of Ascent Energy
3.2	Bylaws of Ascent Energy
4.1	Form of Certificate of Designations of 8% Series A Redeemable Preferred Stock of Ascent Energy
4.2	Specimen 8% Series A Redeemable Preferred Stock Certificate
4.3	Certificate of Designations of 8% Series B Convertible Preferred Stock of Ascent Energy**
4.4	Specimen 8% Series B Convertible Preferred Stock Certificate
4.5	Form of Warrant
5	Opinion of Jones, Walker, Waechter, Poitevent, Carrere & Denegre regarding the validity of the securities being registered
10.1	Stockholders' Agreement dated as of January 19, 2001 among Ascent Energy and Pontotoc stockholders listed on the signature page thereof
10.2	Lease Agreement by and between Pontotoc Gathering, L.L.C. and Enerfin Resources I Limited Partnership dated July 1, 2000
10.3	Form of Indemnity Agreement
10.4	Form of Registration Rights Agreement
23.1	Consent of Arthur Andersen LLP
23.2	Consent of Grant Thornton LLP
23.3	Consent of Jones, Walker, Waechter, Poitevent, Carrere & Denegre, L.L.P. (included in Exhibit 5)
23.4	Consent of James "Robby" Robson, Jr. to serve as a director should the proposed merger with Pontotoc Production, Inc. become effective
23.5	Consent of Jerry Box to serve as a director should the proposed merger with Pontotoc Production, Inc. become effective
23.6	Consent of Netherland Sewell & Associates, Inc.
23.7	Consent of Fletcher Lewis Engineering Inc.
23.8	Consent of C.K. Cooper and Company
24	Power of Attorney (included on the signature page of the Registration Statement)
99.1	Form of Letter of Transmittal
99.2	Form of Notice of Guaranteed Delivery
99.3	Form of Letter to Brokers, Dealers, etc.
99.4	Form of Letter to Clients
99.5	Guidelines for Certification of Taxpayer Identification Number on Substitute Form W–9
99.6	Commitment Letter from Fortis Capital Corp.

_________________

*     Filed herewith as Annex A to the prospectus.
**   Filed herewith as Annex E to the prospectus.

Item 22. Undertakings.

(a) The undersigned Registrant hereby undertakes:

            (1) To respond to requests for information that is incorporated by reference into the prospectus pursuant to Item 4, 10(b), 11 or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

            (2) To supply by means of a post–effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

(b) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New Orleans, State of Louisiana, on March 27, 2001.

ASCENT ENERGY INC.

By:                   /s/ Jeffrey Clarke      
                        Jeffrey Clarke
                          President

POWER OF ATTORNEY

             KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jeffrey Clarke his true and lawful attorney–in–fact and agent, with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post–effective amendments) to this registration statement, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney–in–fact and agent full power and authority to do and perform each and every act and thing requisite and ratifying and confirming all that said attorney–in–fact and agent or his substitute or substitutes may lawfully do or cause to be done by virtue hereof. 

            Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates listed:

Signature	Title	Date
/s/ Nicholas W. Tell, Jr.      Nicholas W. Tell, Jr.	Chairman of the Board	March 27, 2001
/s/ Jeffrey Clarke        Jeffrey Clarke	President and Director (Principal Executive Officer and Principal Accounting Officer)	March 27, 2001
/s/ Daniel O. Conwill, IV    Daniel O. Conwill, IV	Director	March 27, 2001

EX-3.1 2 exhibit31.htm

Exhibit 3.1

CERTIFICATE OF INCORPORATION
OF
ASCENT ENERGY INC.

ARTICLE I
Name

        The name of this corporation is Ascent Energy Inc. (the "Corporation").

ARTICLE II
Registered Office and Registered Agent

        The address of the Corporations registered office in the State of Delaware and its registered agent at such address is:

The Corporation Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
County of New Castle

ARTICLE III
Purpose

        The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the Delaware General Corporation Law (the"DGCL").

ARTICLE IV
Capital

        1.     Authorized Stock.     The Corporation shall be authorized to issue an aggregate of 30,000,000 shares of capital stock, of which 20,000,000 shares shall be Common Stock, $0.001 par value per share (the "Common Stock"), and 10,000,000 shares shall be Preferred Stock, $0.001 par value per share (the "Preferred Stock").

        2.   Preferred Stock.     Preferred Stock may be issued from time to time in one or more series. All shares of any one series of Preferred Stock shall be identical except as to the dates of issue and the dates from which dividends on shares of the series issued on different dates will cumulate if cumulative.

         (a)     Authority is hereby expressly granted to the Board of Directors to authorize the issue of one or more series of Preferred Stock, and to fix by resolution or resolutions providing for the issue of each such series the voting powers, designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof, of such series, to the full extent now or hereafter permitted by law, including, without limitation, the following:

         (1)     the number of shares of such series, which may subsequently be increased, except as otherwise provided by the resolution or resolutions of the Board of Directors providing for the issue of such series, or decreased, to a number not less than the number of shares then outstanding, by resolution or resolutions of the Board of Directors, and the distinctive designation thereof;

         (2)     the dividend rights of such series, the preferences, if any, over any other class or series of stock, or of any other class or series of stock over such series, as to dividends, the extent, if any, to which shares of such series will be entitled to participate in dividends with shares of any other series or class of stock, whether dividends on shares of such series will be fully, partially or conditionally cumulative, or a combination thereof, and any limitations, restrictions or conditions on the payment of such dividends;

         (3)     the rights of such series, and the preferences, if any, over any other class or series of stock, or of any other class or series of stock over such series, in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation and the extent, if any, to which shares of any such series will be entitled to participate in such event with any other series or class of stock;

         (4)     the time or times during which, the price or prices at which, and the terms and conditions on which the shares of such series may be redeemed;

         (5)     the terms of any purchase, retirement or sinking funds which may be provided for the shares of such series; and

         (6)     the terms and conditions, if any, upon which the shares of such series will be convertible into or exchangeable for shares of any other series, class or classes, or any other securities.

         (b)     The shares of Preferred Stock shall have no voting power or voting rights with respect to any matter whatsoever, except as may be otherwise required by law or may be provided in the resolution or resolutions of the Board of Directors creating the series of which such shares are a part.

        (c)     No holders of any series of Preferred Stock will be entitled to receive any dividends thereon other than those specifically provided for by this Certificate of Incorporation or the resolution or resolutions of the Board of Directors providing for the issue of such series of Preferred Stock, nor will any accumulated dividends on Preferred Stock bear any interest, unless specifically provided for by the resolution or resolutions of the Board of Directors providing for the issue of such series of Preferred Stock.

         (d)     In the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, the holders of Preferred Stock of each series will be entitled to receive only such amount or amounts as will have been fixed by this Certificate of Incorporation or by the resolution or resolutions of the Board of Directors providing for the issue of such series.

          3.     Common Stock.     All shares of the Common Stock of the Corporation shall be identical and except as otherwise required by law or as otherwise provided in the resolution or resolutions of the Board of Directors creating any series of Preferred Stock, if any, the holders of the Common Stock shall exclusively possess all voting power, and each share of Common Stock shall have one vote.

ARTICLE V
Business Opportunities

    1.     Definitions.     As used in this Article V, the following terms shall have the following meanings:

         (a)    "Affiliate"    shall mean, with respect to any specified person, (i) any Subsidiary (as defined below) of such person; (ii) any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person; (iii) any other person that owns, directly or indirectly, 10% or more of such specified person's capital stock; (iv) any officer or director of (A) any such specified person, (B) any subsidiary of such specified person, or (C) any person described in clause (ii) or (iii) above; or (v) any heir or legatee or other person having a relationship with any natural person by blood, marriage or adoption not more remote than first cousin or any person directly or indirectly controlling or controlled by or under common control with such other person described in this clause (v). For purposes of this definition, (x) "control," with respect to any specified person, means the possession of the power, whether or not exercised, to direct or cause the direction of the management or policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and the terms "controlling" and "controlled" have meanings correlative to the foregoing and (y) none of the Significant Stockholders shall be deemed to be an Affiliate of the Corporation, or vice versa.

         (b)    "Corporate Opportunity"     shall mean an investment or business opportunity or prospective economic advantage (i) that the Corporation is financially able, contractually permitted and legally able to undertake, (ii) that is, from its nature, the same as or similar to the Corporation's business or the business of any Subsidiary of the Corporation, and (iii) in which the Corporation could, but for the provisions of this Article V, have an interest or expectancy.

         (c)    "Significant Stockholder"    shall mean any holder of Capital Stock of the Corporation that, together with its Affiliates, is entitled to cast at least 25% of the Total Voting Power.

         (d)    "Subsidiary"     shall mean any corporation, partnership, joint venture or other legal entity of which such person (either directly or through or together with any other Subsidiary of such person), owns, directly or indirectly, 50% or more of the stock or other equity interests the holders of which are generally entitled to vote for the election of the board of directors or similar governing body of such corporation, partnership, joint venture or other legal entity.

        2.     Competing Activities.     Except as otherwise expressly provided in an agreement between the Corporation and any Significant Stockholder or among the Corporation and any two or more Significant Stockholders, (i) the Significant Stockholders of the Corporation, including, without limitation, their respective officers directors, agents, stockholders, members, partners and Affiliates, may engage or invest in, independently or with others, any business activity of any type or description, including without limitation those that might be the same as or similar to the Corporation's business or the business of any Subsidiary of the Corporation; (ii) neither the Corporation, any Subsidiary of the Corporation nor any stockholder of the Corporation shall have any right in or to such business activities or ventures or to receive or share in any income or proceeds derived therefrom; and (iii) to the extent required by applicable law in order to effectuate the purpose of this provision, the Corporation shall have no interest or expectancy, and specifically renounces any interest or expectancy, in any such business activities or ventures.

         3.    Corporate Opportunities.

       (a)     If any Significant Stockholder (or, as set forth below, any of its officers, directors, agents, stockholders, members, partners, employees or Affiliates) acquires knowledge of a potential transaction or matter which may be a Corporate Opportunity or otherwise is then exploiting any Corporate Opportunity, the Corporation shall have no interest in such Corporate Opportunity and no expectancy that such Corporate Opportunity be offered to the Corporation, any such interest or expectancy being hereby renounced, so that, as a result of such renunciation, and for the avoidance of doubt, such person (i) shall have no duty to communicate or present such Corporate Opportunity to the Corporation, (ii) shall have the right to hold any such Corporate Opportunity for its (and/or its officers', directors', agents', stockholders', members', partners', employees' or Affiliates') own account or to recommend, sell, assign or transfer such Corporate Opportunity to persons other than the Corporation or any Subsidiary of the Corporation, and (iii) shall not breach any fiduciary duty to the Corporation, in such person's capacity as a stockholder of the Corporation or otherwise, by reason of the fact that such person pursues or acquires such Corporate Opportunity for itself, directs, sells, assigns or transfers such Corporate Opportunity to another person, or does not communicate information regarding such Corporate Opportunity to the Corporation.

        (b)     In the event that a director, officer or employee of the Corporation who is also a director, officer, agent, stockholder, member, partner, employee or Affiliate of a Significant Stockholder acquires knowledge of a potential transaction or matter which may be a Corporate Opportunity for the Corporation or any of its Subsidiaries and such Significant Stockholder or any of its Affiliates, such director, officer or employee of the Corporation shall have fully satisfied and fulfilled the fiduciary duty of such director, officer or employee to the Corporation and its stockholders with respect to such Corporate Opportunity, if such director, officer or employee acts in a manner consistent with the following policy:

        (1) A Corporate Opportunity offered to any person who is a director, officer or employee of the Corporation, and who is also a director, officer, agent, stockholder, member, partner, employee or Affiliate of a Significant Stockholder, shall belong to the Corporation if such opportunity is expressly offered to such person in writing solely in his or her capacity as a director, officer or employee of the Corporation.

         (2) Otherwise, such Corporate Opportunity shall belong to such Significant Stockholder.

        4.     Notice to Holders.     Any person purchasing or otherwise acquiring any interest in shares of the Capital Stock of the Corporation shall be deemed to have notice of and to have consented to the provisions of this Article V.

        5.     Amendments.     Neither the alteration, amendment or repeal of this Article V nor the adoption of any provision of this Certificate of Incorporation inconsistent with this Article V shall eliminate or reduce the effect of this Article V in respect of any matter occurring, or any cause of action, suit or claim that, but for this Article V, would accrue or arise prior to such alteration, amendment, repeal or adoption.

ARTICLE VI
Board of Directors

         1.     Powers.     All of the powers of the Corporation are hereby conferred upon the Board of Directors of the Corporation, insofar as such powers may be lawfully vested by this Certificate of Incorporation in the Board of Directors. In furtherance and not in limitation of those powers, the Board of Directors shall have the power to make, adopt, alter, amend and repeal from time to time the Corporation's Bylaws, subject to the provisions of Article VIII, section 2.

        2.     Number of Directors.     Subject to the restriction that the number of directors shall not be less than the number required by the DGCL, the number of directors may be fixed from time to time pursuant to the Corporation's Bylaws; provided, however, that the number of directors shall not be reduced so as to shorten the term of any director at the time in office.

        3.    Classification.     The members of the Board of Directors, other than those who may be elected by the holders of any one or more series of Preferred Stock voting separately, shall be classified, with respect to the time during which they shall hold office, into three classes, designated Class I, II and III, as nearly equal in number as possible. Any increase or decrease in the number of directors shall be apportioned by the Board of Directors so that all classes of directors shall be as nearly equal in number as possible. At each annual meeting of stockholders, directors chosen to succeed those whose terms then expire shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election and until their successors are duly elected and qualified. The initial term for directors in Class I shall expire at the annual meeting of stockholders to be held in 2001; the initial term for directors in Class II shall expire at the annual meeting of stockholders to be held in 2002; and the initial term for directors in Class III shall expire at the annual meeting of stockholders to be held in 2003.

        4.    Vacancies.     Subject to any requirements of law and the rights of any class or series of Capital Stock having a preference over the Common Stock as to dividends or upon liquidation, and except as provided in section 6 of this Article VI, any vacancy on the Board of Directors (including any vacancy resulting from an increase in the authorized number of directors or from a failure of the stockholders to elect the full number of authorized directors) may, notwithstanding any resulting absence of a quorum of directors, be filled only by the Board of Directors, acting by a vote of a majority of all the directors remaining in office, and any director so appointed shall serve until the next stockholders' meeting held for the election of directors of the class to which such director shall have been appointed and until his successor is duly elected and qualified.

        5.    Removal.     Subject to section 6 of this Article VI, and notwithstanding any other provisions of this Certificate of Incorporation or the Corporation's Bylaws, any director or the entire Board of Directors may be removed at any time at a stockholders' meeting called for such purpose by the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class. At the same meeting in which the stockholders remove one or more directors, the stockholders may elect a successor or successors for the unexpired term of the director or directors removed. Except as set forth in this Article VI, section 5, directors shall not be subject to removal.

        6.    Directors Elected by Preferred Stockholders. Notwithstanding anything in this Certificate of Incorporation to the contrary, whenever the holders of any one or more series of Preferred Stock shall have the right, voting separately as a class, to elect one or more directors of the Corporation, the provisions of this Certificate of Incorporation (as amended from time to time) fixing the rights and preferences of such Preferred Stock shall govern with respect to the nomination, election, term, removal, vacancies or other related matters with respect to such directors.

ARTICLE VII
Limitation of Liability and Indemnification

        1.     Limitation of Liability.     No director shall be personally liable to the Corporation or its stockholders for monetary damages for any breach of fiduciary duty as a director, except (a) for breach of the director's duty of loyalty to the Corporation or its stockholders, (b) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, (c) pursuant to Section 174 of the DGCL, or (d) for any transaction from which such director derived an improper personal benefit.

         2.     Authorization of Further Actions.     The Board of Directors may (a) cause the Corporation to enter into contracts with directors providing for the limitation of liability set forth in this Article VII to the fullest extent permitted by law, (b) adopt Bylaws or resolutions, or cause the Corporation to enter into contracts, providing for indemnification of directors and officers of the Corporation and other persons (including without limitation directors and officers of the Corporation's direct and indirect subsidiaries) to the fullest extent permitted by law, and (c) cause the Corporation to exercise the powers set forth in Section 145(g) of the DGCL, notwithstanding that some or all of the members of the Board of Directors acting with respect to the foregoing may be parties to such contracts or beneficiaries thereof.

        3.     Subsidiaries.     The Board of Directors may cause the Corporation to approve for its direct and indirect subsidiaries limitation of liability and indemnification provisions comparable to the foregoing.

        4.     Amendments.     Any amendment or repeal of this Article VII shall not adversely affect any elimination or limitation of liability of a director of the Corporation under this Article VII with respect to any action or inaction occurring prior to the time of such amendment or repeal. No amendment or repeal of any Bylaw or resolution relating to indemnification shall adversely affect any person's entitlement to indemnification whose claim thereto results from conduct occurring prior to the date of such amendment or repeal.

ARTICLE VIII
Amendments; Definitions

        1.     Amendments to Certificate of Incorporation.     Articles V, VI, VII and VIII of this Certificate of Incorporation shall not be amended in any manner (whether by modification or repeal of an existing Article or Articles or by addition of a new Article or Articles), except upon resolutions adopted by the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class.

        2.    Amendments to Bylaws.     The Corporation's Bylaws may be altered, amended, or repealed or new Bylaws may be adopted by:

(a)     the stockholders, but only upon the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class; or

 (b)     the Board of Directors, but only upon the affirmative vote of a majority of the entire Board of Directors (unless a higher vote is specified in the Corporation's Bylaws).

        3.     Definitions.     For purposes of this Certificate of Incorporation:

        (a)     "Capital Stock" means any Common Stock, Preferred Stock or other shares of capital stock of the Corporation.

         (b)    "Total Voting Power" means the total number of votes that holders of Capital Stock are entitled to cast with respect to the election of directors or, if such term is used in reference to any other particular matter properly brought before the stockholders for their consideration and vote, means the total number of such votes that are entitled to be cast with respect to such matter.

ARTICLE IX
Incorporator

         The name and address of the incorporator of the Corporation is:

James D. Canafax
201 St. Charles Ave., 51st Floor
New Orleans, Louisiana 70170 

ARTICLE X
Initial Directors

 The following persons shall serve as the initial directors of the Corporation, each to serve in such capacity until the first annual meeting of stockholders or until their successors are duly elected and qualified:

Name	Class
Jeff Clarke Daniel O. Conwill, IV Nicholas W. Tell	Class I Director Class II Director Class III Director

ARTICLE XI
Books and Records

         The books of the Corporation may be kept (subject to any requirement of the DGCL) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the Corporation's Bylaws.

        IN WITNESS WHEREOF, the undersigned, being the named Incorporator of the Corporation, for the purpose of forming a corporation pursuant to the Delaware General Corporation Law, does make this Certificate of Incorporation, hereby declaring and certifying that this is his act and deed and the facts herein stated are true, and accordingly the undersigned has hereunto set his hand this 9th day of January, 2001.

                /s/ James D. Canafax               
James D. Canafax
Incorporator

EX-3.2 3 exhibit32.htm

Exhibit 3.2

BYLAWS
OF
ASCENT ENERGY INC.

SECTION 1
Offices

        1.1     Registered Office.     The registered office of Ascent Energy Inc. (the "Corporation") shall be in the City of Wilmington, County of New Castle, State of Delaware.

        1.2     Other Offices.     The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.

SECTION 2
Meetings of Stockholders 

        2.1     Annual Meetings.     Unless directors are elected by written consent in lieu of an annual meeting, an annual meeting of stockholders shall be held for the election of directors at such date, time and place, if any, either within or without the State of Delaware, as shall be designated by the Board of Directors and stated in the notice of the meeting. If no designation is made, the place of meeting shall be the principal office of the Corporation. Notwithstanding the foregoing, the Board of Directors may, in its sole discretion, determine that any such annual meeting shall not be held at any designated place, but may instead be held solely by means of remote communication.

        2.2     Special Meetings.     (a) Special meetings of the stockholders for any purpose or purposes may be called by the Chairman of the Board or upon a majority vote of the Board of Directors, at such date, time and place, if any, either within or without the State of Delaware as shall be designated by the Board of Directors as set forth in Section 2.1 and stated in the notice of the meeting.

                 (b)     Except as otherwise provided in the Certificate of Incorporation or required by applicable law, the Secretary shall call a special meeting of the stockholders, to be held on such date as the Secretary shall determine, not less than 15 nor more than 60 days after the actual receipt of a request in writing of any Beneficial Owner or Owners of at least 10% of the Total Voting Power. Such request shall set forth:

                (i)     a complete and accurate description of the matter not to exceed 500 words, of the action proposed to be taken at such meeting, the reasons for the action and any material interest of the stockholder in the matter;

                 (ii)     the name, business address and residential address of each Beneficial Owner composing the group making the request, the Total Voting Power held by each such person and the dates on which each such person acquired his or her Capital Stock;

                (iii)     a representation that at least one such Beneficial Owner or a representative thereof intends to appear in person at the meeting to propose the action specified in the request; and

                (iv)     if any proposed action consists of or includes a proposal to amend either the Certificate of Incorporation or the Bylaws, the language of the proposed amendment.

The Secretary may require any person or persons submitting a request to call a special meeting of stockholders to furnish such documentary information as may be reasonably required by the Corporation to determine that such person or persons as a group Beneficially Owns at least 10% of the Total Voting Power. The Secretary may refuse to call a special meeting unless the request is made in compliance with the foregoing procedure.

        2.3     Notice of Stockholder Nominations and Stockholder Business.     (a) At any meeting of stockholders, only such business shall be conducted as shall have been properly brought before the meeting. Except as otherwise provided in the Certificate of Incorporation or required by applicable law, nominations for the election of directors at a meeting at which directors are to be elected or other matters to be properly brought before any meeting of stockholders (other than any special meeting of stockholders called pursuant to Section 2.2(b)) must be (i) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (ii) otherwise properly brought before the meeting by or at the direction of the Board of Directors, or (iii) otherwise properly brought before the meeting by any person who (A) has been for at least one year the Beneficial Owner of at least 1% of the Total Voting Power and (B) complies with the procedures set forth below.

                (b)     A notice of the intent of a stockholder to make a nomination or to bring any other matter before the meeting shall be made in writing and received by the Secretary not more than 270 days and not less than 120 days in advance of the first anniversary of the date on which the Corporation mailed notice and/or proxy materials in connection with the preceding year's annual meeting of stockholders or, if a special meeting or an annual meeting of stockholders is scheduled to be held either 30 days earlier or later than the preceding year's annual meeting, such notice shall be received by the Secretary within 15 days of the earlier of the date on which notice of such meeting is first mailed to stockholders or public disclosure of the meeting date is made.

                (c)     Every such notice by a stockholder shall set forth:

                (i)     the name, age, business address and residential address of the stockholder who intends to make a nomination or bring up any other matter, and any person acting in concert with such stockholder;

                (ii)     the number of shares of Capital Stock of which the stockholder is the Beneficial Owner, the dates on which such person acquired his or her Capital Stock and the Total Voting Power held by such person;

                (iii)     a representation that the stockholder intends to appear in person at the meeting to make the nomination or bring up the matter specified in the notice;

                (iv)     with respect to notice of an intent to make a nomination, a description of all agreements, arrangements or understandings among the stockholder, any person acting in concert with the stockholder, each proposed nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder;

                (v)     with respect to notice of an intent to make a nomination, (A) the name, age, business address and residential address of each person proposed for nomination, (B) the principal occupation or employment of such person, (C) the class and number of shares of Capital Stock of the Corporation of which such person is the Beneficial Owner, and (D) any other information relating to such person that would be required to be disclosed in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission had such nominee been nominated by the board of directors of a public company; and

                (vi)     with respect to notice of an intent to bring up any other matter, a complete and accurate description of the matter not to exceed 500 words, the reasons for conducting such business at the meeting, and any material interest of the stockholder in the matter.

                (d)     The Secretary may require any stockholder submitting a notice of an intent to make a nomination or bring up other business to furnish such documentary information as may be reasonably required by the Corporation to determine that such stockholder has been for at least one year the Beneficial Owner of at least 1% of the Total Voting Power entitled to vote on the proposed business.

                (e)     Notice of an intent to make a nomination shall be accompanied by the written consent of each nominee to serve as a director of the Corporation if so elected and an affidavit of each such nominee certifying that he or she meets the qualifications necessary to serve as a director. The Corporation may require any proposed nominee to furnish such other information as may be reasonably required by the Corporation to determine the eligibility and qualifications of such person to serve as a director.

                (f)     With respect to any proposal by a stockholder to bring before a meeting any matter other than the nomination of directors, the following shall govern:

                (i)     If the Secretary has received sufficient notice of a proposal that may properly be brought before the meeting, a proposal sufficient notice of which is subsequently received by the Secretary and that is substantially duplicative of the first proposal shall not be properly brought before the meeting. If in the judgment of the Board of Directors a proposal deals with substantially the same subject matter as a prior proposal submitted to stockholders at a meeting held within the preceding five years, it shall not be properly brought before any meeting held within three years after the latest such previous submission if (A) the proposal was submitted at only one meeting during such preceding period and it received affirmative votes representing less than 3% of the total number of votes cast in regard thereto, (B) the proposal was submitted at only two meetings during such preceding period and it received at the time of its second submission affirmative votes representing less than 6% of the total number of votes cast in regard thereto, or (C) the proposal was submitted at three or more meetings during such preceding period and it received at the time of its latest submission affirmative votes representing less than 10% of the total number of votes cast in regard thereto.

                (ii)     Notwithstanding compliance with all of the procedures set forth above in this Section, no proposal shall be deemed to be properly brought before a meeting of stockholders if, in the judgment of the Board of Directors, it is not a proper subject for action by stockholders under Delaware Law.

                (g)     At the meeting of stockholders, the chairman shall declare out of order and disregard any nomination or other matter that is not presented in accordance with the foregoing procedures or that is otherwise contrary to the foregoing terms and conditions.

        2.4     Notice of Meeting.     Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, if any, date and time of the meeting, the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and permitted to vote at such meeting, and the purpose or purposes for which the meeting is called. Unless otherwise provided by law, the written notice of any meeting shall be given to each stockholder entitled to vote at such meeting not less than 10 nor more than 60 days before the date of the meeting.

        2.5     Stockholder List.     The Secretary shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting.

        2.6     Quorum.     Except as otherwise provided by law, the Certificate of Incorporation or these Bylaws, with respect to each matter considered and voted upon at any stockholders' meeting, the holders of a majority of the outstanding shares of each class of Capital Stock, or series thereof, entitled to vote thereon, present in person or represented by proxy, shall constitute a quorum, provided that two or more classes or series shall be considered a single class if the holders thereof are entitled to vote together as a single class with respect to such matter. The Board of Directors may, in its sole discretion, adopt guidelines and procedures so that stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication, be deemed present in person at a meeting of stockholders, whether such meeting is to be held at a designated place or solely by means of remote communication. If, however, a quorum shall not be present or represented at any meeting of the stockholders (or with respect to any matter to be considered and voted upon thereat), the holders of any class of Capital Stock or series thereof entitled to vote thereat (or with respect to any such matter), present in person or represented by proxy, shall have the power to adjourn the meeting (or the vote upon such matter, without prejudice to the right of the stockholders to vote upon any matter as to which a quorum does exist) from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented any business may be transacted that might have been transacted at the meeting as originally notified. If the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting (or with respect to such matter).

        2.7     Vote Required.     When a quorum is present with respect to any matter considered at any meeting of stockholders, the vote of the holders of a majority of the Total Voting Power shall decide such matter, unless the matter is one upon which by express provision of law, the Certificate of Incorporation or these Bylaws, a different vote is required, in which case such express provision shall govern and control the decision of such matter.

        2.8     Voting Rights of Stockholders.     Unless otherwise provided in the Certificate of Incorporation, each stockholder shall at every meeting of the stockholders be entitled to one vote in person or by proxy for each share of Capital Stock held of record by such holder.

        2.9     Proxies and Electronic Voting.     (a) Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period.

                (b)     Execution of a proxy may be accomplished by a stockholder or his or her authorized officer, director, employee or agent signing such writing or causing his or her signature to be affixed to such writing by any reasonable means including, without limitation, by facsimile signature. A stockholder may authorize another person or persons to act for him as proxy by transmitting or authorizing the transmission of a telegram, cablegram, or other means of electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telegram, cablegram or other means of electronic transmission must either set forth or be submitted with information from which it can be determined that the telegram, cablegram or other electronic transmission was authorized by the stockholder. If it is determined that such telegrams, cablegrams or other electronic transmissions are valid, the inspectors shall specify the information upon which they relied.

                (c)     Any copy, facsimile telecommunication or other reliable reproduction of the writing or transmission may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission.

                (d)     A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy that is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or another duly executed proxy bearing a later date with the Secretary.

                (e)     The Board of Directors may, in its sole discretion, adopt guidelines and procedures so that stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication, participate in a meeting of stockholders, whether such meeting is to be held at a designated place or solely by means of remote communication, provided that (i) the Corporation shall implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder, (ii) the Corporation shall implement reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings, and (iii) if any stockholder or proxyholder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the Corporation.

                2.10     Consent in Lieu of Meeting.     Unless otherwise provided in the Certificate of Incorporation, any action required to be taken at any annual or special meeting of stockholders, or any action that may be taken at any annual or special meeting of such stockholders, including the election of directors, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of Capital Stock having not less than the minimum number of votes that would be necessary to authorize or take such action at an annual or special meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and who would have been entitled to notice of the meeting, had a meeting been held.

                2.11     Treasury Stock.     Shares of Capital Stock held in the treasury of the Corporation shall not be deemed to be outstanding shares for the purpose of voting or determining the presence of a quorum or the total number of shares entitled to vote on any matter.

                2.12     Presiding Officer.     All meetings of stockholders shall be presided over by the Chairman of the Board or, in his absence, by a chairman designated by the Board of Directors. The Secretary or, in the absence of the Secretary, an Assistant Secretary, shall act as secretary of the meeting, and in their absence, the chairman of the meeting may appoint any person to act as secretary of the meeting.

                2.13     Inspectors.     Prior to a meeting of stockholders, the Board of Directors shall appoint one or more inspectors to act at the meeting and make a written report thereof. Each inspector shall take and sign an oath faithfully to execute the duties of with strict impartiality and according to the best of his or her ability. The inspectors shall (i) ascertain the number of shares outstanding and the voting power of each, (ii) determine the shares represented at a meeting and the validity of the proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, (v) certify their determination of the number of shares represented at the meeting, and their count of all votes and ballots, and (vi) perform such other functions as the presiding officer of the meeting shall determine. The inspectors may appoint or retain other persons or entities to assist them in the performance of their duties.

                2.14     Adjournments.     Any annual or special meeting of stockholders may be adjourned by the presiding officer from time to time to reconvene at the same or some other place, if any, and notice need not be given of any such adjourned meeting if the time and place, if any, thereof and the means of remote communication, if any, by which stockholders and proxyholders may be deemed present and permitted to vote at such adjourned meeting, are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

SECTION 3
Directors

        3.1     Powers.     The business and affairs of the Corporation shall be managed under the direction of a Board of Directors, except as otherwise provided by Delaware Law or by the Certificate of Incorporation.

        3.2     Number.     Subject to the restriction that the number of directors shall not be less than the number required by Delaware Law, and subject further to the creation or lapse of directorships upon the occurrence of events specified in the Certificate of Incorporation, the number of directors shall be fixed, from time to time, by a resolution adopted by a majority of the directors then in office. Until otherwise fixed by the directors, the number of directors constituting the entire Board of Directors shall be no less than two and no more than seven. The Secretary shall have the power to certify at any time as to the number of directors authorized and as to the class to which each director has been elected or assigned.

        3.3     Classification.     The members of the Board of Directors, other than those who may be elected by the holders of any one or more series of Preferred Stock voting separately, shall be classified, with respect to the time during which they shall hold office, into three classes, designated Class I, II and III, as nearly equal in number as possible. Any increase or decrease in the number of directors shall be apportioned by the Board of Directors so that all classes of directors shall be as nearly equal in number as possible. At each annual meeting of stockholders, directors chosen to succeed those whose terms then expire shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election and until their successors are duly elected and qualified.

        3.4     Resignation.     Any director may resign at any time upon notice given in writing or by electronic transmission to the President or Secretary. Such resignation shall take effect at the time specified therein, and unless otherwise specified therein no acceptance of such resignation shall be necessary to make it effective.

        3.5     Nominations.     If an annual meeting of stockholders is held for the purpose of electing directors, any person nominated by a stockholder must be nominated in accordance with the procedures set forth in Section 2.3 to be eligible for election. Notwithstanding any provision of these Bylaws to the contrary, the provisions of Section 2.3 shall not apply to the election of any directors which the holders of any class or series of Preferred Stock, voting separately as a class, may be entitled to elect.

        3.6     Election of Directors.     Unless otherwise provided in the Certificate of Incorporation, at each meeting of the stockholders for the election of directors at which a quorum is present, directors shall be elected by a plurality of the Total Voting Power present in person or represented by proxy at the meeting.

        3.7     Compensation.     Unless otherwise restricted by the Certificate of Incorporation or of these Bylaws, the Board of Directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors. The directors may be paid a stated salary as director or a fixed sum for attendance at each meeting of the Board of Directors or committee. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor.

SECTION 4
Meetings of the Board of Directors

        4.1     Meetings.     The Board of Directors may hold meetings, both regular and special, either within or without the State of Delaware.

        4.2     Regular Meetings.     Regular meetings of the Board of Directors may be held without notice at such time and at such place as shall from time to time be determined by the Board of Directors.

        4.3     Special Meetings.     Special meetings of the Board of Directors may be called by the Chairman of the Board on at least 24 hours notice to each director, either personally or by mail, telephone, overnight courier service, facsimile transmission or other electronic transmission. Special meetings shall be called by the Chairman of the Board or the President in like manner and on like notice on the written request of any director. Any notice to call a special meeting pursuant to this section may be executed by the Secretary acting on behalf of the person calling the meeting.

        4.4     Quorum.     At all meetings of the Board of Directors a majority of the directors shall constitute a quorum for the transaction of business and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by law or by the Certificate of Incorporation. If a quorum shall not be present at any meeting of the Board of Directors, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

        4.5     Action at Meeting.     If a quorum is present when any meeting of the Board of Directors is convened, the directors may continue to do business, taking action by vote of a majority of a quorum as fixed in Section 4.4, until adjournment, notwithstanding the withdrawal of enough directors to leave less than a quorum or the refusal of any director present to vote.

        4.6     Action by Consent.     Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board of Directors or committee, as the case may be, consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board of Directors or committee.

        4.7     Meetings by Telephone.     Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, members of the Board of Directors or any committee designated by the Board of Directors may participate in a meeting of the Board of Directors or any committee, by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

        4.8     Presiding Officer.     The Chairman of the Board shall preside at all meetings of the Board of Directors or, in his absence, a chairman appointed by the Board of Directors. The Secretary or in the absence of the Secretary, an Assistant Secretary, shall act as secretary of each meeting, but in the absence of the Secretary and an Assistant Secretary, the chairman of the meeting may appoint any person to act as secretary of the meeting.

SECTION 5
Committees of the Board of Directors 

        5.1     Designation of Committees.     The Board of Directors may, by resolution passed by a majority of the directors then in office, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member.

        5.2     Authority of Committees.     Any such committee shall have those powers of the Board of Directors in the management of the business and affairs of the Corporation provided in the resolution of the Board of Directors designating such committee, provided that no such committee shall have the power or authority to propose amendments to the Certificate of Incorporation, adopt an agreement of merger or consolidation, recommend to the stockholders the sale, lease or exchange of all or substantially all of the Corporation's property or assets, recommend to the stockholders a dissolution of the Corporation or a revocation of a dissolution, or amend these Bylaws.

        5.3     Minutes.      Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required.

SECTION 6
Notices

        6.1     Form of Notice.     Whenever, under any provision of Delaware Law, the Certificate of Incorporation or these Bylaws, notice is required to be given to any director or stockholder and no provision is made as to how such notice shall be given, it shall not be construed to mean solely personal notice, but such notice may be given in writing (i) by mail, postage prepaid, addressed to such director or stockholder, at his address as it appears on the books or, in the case of a stockholder, the stock transfer records of the Corporation, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail, (ii) by overnight courier service, and such notice shall be deemed to be given the day following the day it is delivered to such service with all charges prepaid, (iii) by facsimile, telecopy or similar means, and such notice shall be deemed to be given the day it is transmitted with all charges prepaid, or (iv) by any other method permitted by law, such notice to be deemed to be given when received by the director or stockholder.

        6.2     Waiver.     Whenever any notice is required to be given to any stockholder or director under the provisions of Delaware Law, the Certificate of Incorporation or these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to receive such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of notice to such person or persons. Attendance of a stockholder or director at a meeting shall constitute a waiver of notice of such meeting, except when the person attends for the express purpose of objecting at the beginning of the meeting to the transaction of any business on the ground that the meeting is not lawfully called or convened.

SECTION 7
Officers

        7.1     General.     The officers of the Corporation shall be chosen by the Board of Directors at its first meeting after each annual meeting of stockholders and shall be a President, a Secretary and a Treasurer. The Board of Directors may also choose one or more Vice Presidents and one or more Assistant Secretaries and Assistant Treasurers. Any number of offices may be held by the same person, unless the Certificate of Incorporation or the Bylaws otherwise provide.

        7.2     Other Officers.     The Board of Directors may appoint such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors.

        7.3     Compensation.     The salaries of all officers and agents of the Corporation shall be fixed by the Board of Directors.

        7.4     Term.     The officers of the Corporation shall hold office until their successors are chosen and qualify. Subject to such obligations of the Corporation as may exist under any contract of employment, any officer elected or appointed by the Board of Directors may be removed at any time by the affirmative vote of a majority of the directors then in office. Any vacancy occurring in any office of the Corporation shall be filled by the Board of Directors.

        7.5     Chairman of the Board.     The Board of Directors may appoint a Chairman who shall preside at meetings of the Board of Directors and the stockholders and perform such other duties as may be designated by the Board of Directors or these Bylaws. The Chairman shall not, solely by virtue of such position, be an officer of the Corporation.

        7.6     President.     The President shall have the general powers, duties and responsibilities of supervision and management inherent in such office as well as such additional powers and duties as the Board of Directors may from time to time prescribe. The President shall be the chief executive officer and chief operating officer of the Corporation. The President shall control and direct the Corporation's business and, except as the Board of Directors may otherwise direct, shall supervise, direct and control the management and daily operations of the business of the Corporation and have general charge of the Corporation's property and supervision over the Corporation's officers, employees and agents. At the request of the Chairman of the Board, or in his absence or during his disability, the President shall perform the duties and exercise the functions of the Chairman of the Board. Except as the Board of Directors may otherwise authorize, the President shall execute bonds, mortgages and any other contracts of any nature on behalf of the Corporation. The President and any person performing the duties of the President in his absence or in the event of his inability or refusal to act shall be a United States citizen.

        7.7     Vice Presidents.     In the absence of the President or in the event of his inability or refusal to act, the Vice President (or in the event there be more than one Vice President, the Vice Presidents in the order designated by the Board of Directors, or in the absence of any designation, then in the order of their election) shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President. The Vice Presidents shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

        7.8     Secretary.     The Secretary shall attend all meetings of the Board of Directors and all meetings of the stockholders and record all the proceedings of the meetings of the Corporation and of the Board of Directors in a book to be kept for that purpose and shall perform like duties for the standing committees when required. He shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors or President, under whose supervision he shall be. He shall have custody of the corporate seal of the Corporation and he, or an Assistant Secretary, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by his signature or by the signature of such Assistant Secretary. The Board of Directors may give general authority to any other officer to affix the seal of the Corporation and to attest the affixing by his signature.

        7.9     Assistant Secretary.     The Assistant Secretary, or if there be more than one, the Assistant Secretaries in the order determined by the Board of Directors (or if there be no such determination, then in the order of their election) shall, in the absence of the Secretary or in the event of his inability or refusal to act, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

        7.10     Treasurer.     The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the President and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all his transactions as treasurer and of the financial condition of the Corporation. If required by the Board of Directors, he shall give the Corporation a bond (which shall be renewed every six years) in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of his office and for the restoration to the Corporation, in case of his death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the Corporation.

        7.11     Assistant Treasurer.     The Assistant Treasurer, or if there shall be more than one, the Assistant Treasurers in the order determined by the Board of Directors (or if there be no such determination, then in the order of their election) shall, in the absence of the Treasurer or in the event of his inability or refusal to act, perform the duties and exercise the powers of the Treasurer and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

SECTION 8
Stock

        8.1     Certificated or Uncertificated.     The shares of the Corporation shall be uncertificated or shall be represented by certificates signed in the name of the Corporation by the Chairman of the Board or the President or a Vice President and by the Secretary or an Assistant Secretary. Upon the face or back of each stock certificate issued to represent any partly paid shares, or upon the books and records of the Corporation in the case of uncertificated partly paid shares, shall be set forth the total amount of the consideration to be paid therefor and the amount paid thereon shall be stated.

        8.2     Summary of Rights.     The powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series of each class of stock, and of each series of any class, and the qualifications, limitations or restrictions of such preferences and rights shall be set forth in full or summarized on the face or back of the certificate that the Corporation shall issue to represent such class or series of stock; provided that, except as otherwise provided in Section 202 of Delaware Law, or in any act amending, supplementing or substituted for such section, in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate which the Corporation shall issue to represent such class or series of stock, a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and rights.

        8.3     Notice to Holders of Uncertificated Stock.     Within a reasonable time after the issuance or transfer of uncertificated stock, the Corporation shall send to the registered owner thereof a written notice containing the information required to be set forth or stated on certificates pursuant to Sections 151, 156, 202(a) or 218(a) of Delaware Law or a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and rights.

        8.4     Facsimile Signatures.     Any of or all the signatures on a certificate may be facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent or registrar at the date of issue.

        8.5     Lost Certificates.     The Board of Directors may direct a new certificate or certificates or uncertificated shares to be issued in place of any certificate or certificates theretofore issued by the Corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates or uncertificated shares, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the certificate alleged to have been lost, stolen or destroyed.

        8.6     Transfer of Stock.     Upon surrender to the Corporation or the transfer agent of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, it shall be the duty of the Corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Upon receipt of proper transfer instructions from the registered owner of uncertificated shares such uncertificated shares shall be cancelled and issuance of new equivalent uncertificated shares or certificated shares shall be made to the person entitled thereto and the transaction shall be recorded upon the books of the Corporation.

        8.7     Registered Stockholders.     Except as otherwise provided by law, the Corporation, and its directors, officers and agents, may recognize and treat a person registered on its records as the owner of shares, as the owner in fact thereof for all purposes, and as the person exclusively entitled to have and to exercise all rights and privileges incident to the ownership of such shares, and rights under this Section 8.7 shall not be affected by any actual or constructive notice that the Corporation, or any of its directors, officers or agents, may have to the contrary.

SECTION 9
Indemnification

        9.1     Indemnity.     (a) Except with respect to an action or Claim (other than as authorized in Section 9.2) commenced by an Indemnitee against the Corporation or by an Indemnitee as a derivative action by or in the right of the Corporation that has not been authorized by the Board of Directors, the Corporation shall indemnify, defend and hold harmless any Indemnitee against Expenses reasonably incurred or suffered in connection with any Claim against Indemnitee, whether the basis of such Claim is alleged action or inaction in an official or other capacity while serving as a director or officer of the Corporation or while serving at the request of the Corporation as a director, officer or fiduciary of another corporation, partnership, joint venture, trust or other enterprise or an employee benefit plan of the Corporation (including appearances as a witness or in connection with giving testimony or evidence), if:

        (i) the Indemnitee is successful in his defense of the Claim on the merits or otherwise, or

        (ii) the Indemnitee has been found by the Determining Body to have met the Standard of Conduct (as determined in accordance with the procedures set forth in this Section 9.1), provided that no indemnification shall be made in respect of any Claim by or in the right of the Corporation as to which Indemnitee shall have been adjudicated in a final judgment to be liable to the Corporation, unless, and only to the extent that the court in which such Claim was brought shall determine upon application that, despite such adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for such Expenses which the court shall deem proper.

                (b)     For purposes of this Section 9, the "Standard of Conduct" is met when conduct by an Indemnitee with respect to which a Claim is asserted was conduct performed in good faith which he reasonably believed to be in, or not opposed to, the best interest of the Corporation, and, in the case of a Claim which is a criminal action or proceeding, conduct that the Indemnitee had no reasonable cause to believe was unlawful. The termination of any Claim by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not meet the Standard of Conduct.

                (c)     Promptly upon becoming aware of the existence of any Claim as to which Indemnitee may be indemnified hereunder, Indemnitee shall notify the Chairman of the Board, but the failure to promptly notify the Chairman of the Board shall not relieve the Corporation from any obligation under this Section 9. Upon receipt of such request, the Chairman of the Board shall promptly advise the members of the Board of Directors of the request and that the establishment of a Determining Body with respect to Indemnitee's request for indemnification as to the Claim will be presented at the next regularly scheduled meeting of the Board of Directors. If a meeting of the Board of Directors is not regularly scheduled within 90 calendar days of the date the Chairman of the Board receives notice of the Claim, the Chairman of the Board shall cause a special meeting of the Board of Directors to be called within such period in accordance with the provisions of these Bylaws. After the Determining Body has been established, the Determining Body shall inform the Indemnitee of the constitution of the Determining Body and Indemnitee shall provide the Determining Body with all facts relevant to the Claim known to such Indemnitee, and deliver to the Determining Body all documents relevant to the Claim in Indemnitee's possession. Before the 60th day after its receipt from the Indemnitee of such information (the "Determination Date"), together with such additional information as the Determining Body may reasonably request of Indemnitee prior to such date (the receipt of which shall not begin a new 60-day period) the Determining Body shall determine whether or not Indemnitee has met the Standard of Conduct and shall advise Indemnitee of its determination. If Indemnitee shall have supplied the Determining Body with all relevant information, including all additional information reasonably requested by the Determining Body, any failure of the Determining Body to make a determination by or on the Determination Date as to whether the Standard of Conduct was met shall be deemed to be a determination that the Standard of Conduct was met by Indemnitee.

                (d)     If at any time during the 60-day period ending on the Determination Date, Indemnitee becomes aware of any relevant facts not theretofore provided by him to the Determining Body, Indemnitee shall inform the Determining Body of such facts, unless the Determining Body has obtained such facts from another source. The provision of such facts to the Determining Body shall not begin a new 60 day period.

                (e)     The Determining Body shall have no power to revoke a determination that Indemnitee met the Standard of Conduct unless Indemnitee (i) submits to the Determining Body at any time during the 60 days prior to the Determination Date fraudulent information, (ii) fails to comply with the provisions of Section 9.1(d), or (iii) intentionally fails to submit information or documents relevant to the Claim reasonably requested by the Determining Body prior to the Determination Date.

                (f)     In the case of any Claim not involving any threatened or pending criminal proceeding:

            (i)     if prior to the Determination Date the Determining Body has affirmatively made a determination that Indemnitee met the Standard of Conduct (not including a determination deemed to have been made by inaction), the Corporation may, in its sole discretion, after notice to Indemnitee, assume all responsibility for the defense of the Claim with counsel satisfactory to Indemnitee (who shall not, except with the written consent of Indemnitee, be counsel to the Corporation), and, in any event, the Corporation and the Indemnitee each shall keep the other informed as to the progress of the defense of the Claim, including prompt disclosure of any proposals for settlement; provided that if the Corporation is a party to the Claim and Indemnitee reasonably determines that there is any conflict between the positions of the Corporation and Indemnitee, with respect to the Claim or otherwise, then Indemnitee shall be entitled to conduct his defense with counsel of his choice at the Corporation's expense in accordance with the terms and conditions of this Section 9; and provided further that Indemnitee shall in any event be entitled at his expense to employ counsel chosen by him to participate in the defense of the Claim; and

        (ii)     The Corporation shall not be obligated to indemnify Indemnitee for any amount paid in a settlement that the Corporation has not approved. The Corporation shall fairly consider any proposals by Indemnitee for settlement of the Claim. If the Corporation proposes a settlement of the Claim and such settlement is acceptable to the person asserting the Claim, or the Corporation believes a settlement proposed by the person asserting the Claim should be accepted, it shall inform Indemnitee of the terms of such proposed settlement and shall fix a reasonable date by which Indemnitee shall respond. If Indemnitee agrees to such terms, he shall execute such documents as shall be necessary to make final the settlement. If Indemnitee does not agree with such terms, Indemnitee may proceed with the defense of the Claim in any manner he chooses, provided that if Indemnitee is not successful on the merits or otherwise, the Corporation's obligation to indemnify such Indemnitee as to any Expenses incurred following his disagreement shall be limited to the lesser of (A) the total Expenses incurred by Indemnitee following his decision not to agree to such proposed settlement or (B) the amount that the Corporation would have paid pursuant to the terms of the proposed settlement.

                (g)     In the case of any Claim involving a proposed, threatened or pending criminal proceeding, Indemnitee shall be entitled to conduct the defense of the Claim with counsel of his choice and to make all decisions with respect thereto; provided, that the Corporation shall not be obliged to indemnify Indemnitee for any amount paid in settlement of such a Claim unless the Corporation has approved such settlement.

                (h)     After notifying the Corporation of the existence of a Claim in accordance with Section 9.1(c), Indemnitee may from time to time request the Corporation to pay the Expenses (other than judgments, fines, penalties or amounts paid in settlement) that he incurs in pursuing a defense of the Claim prior to the time that the Determining Body determines whether the Standard of Conduct has been met. The Disbursing Officer shall pay to Indemnitee the amount requested (regardless of Indemnitee's apparent ability to repay such amount) upon receipt of an undertaking by or on behalf of Indemnitee to repay such amount along with any other amounts advanced or paid after the Determination Date in accordance with the provisions of this Section 9.1, if (i) the Determining Body determines prior to the Determination Date that Indemnitee did not meet the Standard of Conduct or (ii) Indemnitee is prohibited from being indemnified by the Corporation by virtue of the provisions of Delaware Law.

                (i)     After it has been determined that the Standard of Conduct has been met, for so long as and to the extent that the Corporation is required to indemnify Indemnitee under this Section 9, the provisions of Section 9.1(h) shall continue to apply with respect to Expenses incurred after such time except that (i) no undertaking shall be required of Indemnitee and (ii) the Disbursing Officer shall pay to Indemnitee the amount of any fines, penalties or judgments against him that have become final and for which he is entitled to indemnification hereunder, and any amount of indemnification ordered to be paid to him by a court.

                (j)     Any determination by the Corporation with respect to settlement of a Claim shall be made by the Determining Body.

                (k)     All determinations and judgments made by the Determining Body hereunder shall be made in good faith.

                (l)     The Corporation and Indemnitee shall keep confidential to the extent permitted by law and their fiduciary obligations all facts and determinations provided pursuant to or arising out of the operation of this Section 9 and the Corporation and Indemnitee shall instruct its or his agents and employees to do likewise.

        9.2     Enforcement.     The rights provided by this Section 9 shall be enforceable by Indemnitee in any court of competent jurisdiction. If Indemnitee seeks a judicial adjudication of his rights under this Section 9 Indemnitee shall be entitled to recover from the Corporation, and shall be indemnified by the Corporation against, any and all Expenses actually and reasonably incurred by him in connection with such proceeding but only if he prevails therein. If it shall be determined that Indemnitee is entitled to receive part but not all of the relief sought, then the Indemnitee shall be entitled to be reimbursed for all Expenses incurred by him in connection with such judicial adjudication if the amount to which he is determined to be entitled exceeds 50% of the amount of his claim. Otherwise, the Expenses incurred by Indemnitee in connection with such judicial adjudication shall be appropriately prorated.

        9.3     Reformation.     If any provision of this Section 9 is determined by a court having jurisdiction over the matter to violate or conflict with applicable law, the court shall be empowered to modify or reform such provision so that, as modified or reformed, such provision provides the maximum indemnification permitted by Delaware Law, and such provision, as so modified or reformed, and the balance of this Section 9 shall be applied in accordance with their terms. Without limiting the generality of the foregoing, if any portion of this Section 9 shall be invalidated on any ground, the Corporation shall nevertheless indemnify an Indemnitee to the full extent permitted by any applicable portion of this Section 9 that shall not have been invalidated and to the full extent permitted by law with respect to that portion that has been invalidated.

        9.4     Successors and Assigns.     This Section 9 shall be binding upon the Corporation, its successors and assigns, and shall inure to the benefit of the Indemnitee's heirs, administrators, executors, personal representatives and assigns and to the benefit of the Corporation, its successors and assigns.

        9.5     Amendments.      No amendment to or modification of this Section 9 or any portion hereof shall limit any Indemnitee's entitlement to indemnification in accordance with the provisions hereof with respect to any acts or omissions of Indemnitee which occur or accrue prior to such amendment or modification.

        9.6     Contribution.     If the indemnity provided for in this Section 9 is for any reason unavailable or insufficient to hold harmless an Indemnitee with respect to any Expenses, the Corporation shall make a contribution to the Indemnitee for such liabilities to which the Indemnitee may be subject in such proportion as is appropriate to reflect the intent of this Section 9.

        9.7     Reliance.     Each person who is serving as an Indemnitee shall be deemed to be doing so in reliance upon the indemnification provided for in this Section 9. The rights of an Indemnitee hereunder shall be contract rights and shall vest in the Indemnitee upon the occurrence of the event, or the first event in a chain of events, giving rise to such Claim; provided that the adoption of the Bylaws shall not affect any right or obligation of the Corporation or of any Indemnitee which existed prior to such adoption.

        9.8     Nonexclusivity.     (a)  The rights conferred herein on any person shall (i) be severable, (ii) not be exclusive of any other rights which such person may have or hereafter acquire under any statute, certificate of incorporation, contract or other agreement, authorization of stockholders or disinterested directors or otherwise, and (iii) continue as to an Indemnitee who has ceased to serve on behalf of the Corporation in respect of all claims arising out of action (or inaction) occurring prior to such time.

                (b)     It is the intent of the Corporation to indemnify and hold harmless Indemnitee to the fullest extent permitted by Delaware Law, as such law exists or may be amended after the date the Bylaws are adopted, but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than Delaware Law permitted prior to the amendment, notwithstanding any provision in Section 9 to the contrary.

        9.9     Insurance.     The Corporation may procure or maintain insurance or other similar arrangement on behalf of any Indemnitee or any person who is or was an employee or agent of the Corporation, or is serving at the request of the Corporation as an employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against or incurred by him in his capacity as such, or arising out of his status as such, whether or not the Corporation would have the power to indemnify him against such liability under the provisions of Delaware Law. Without limiting the power of the Corporation to procure or maintain any other kind of insurance or similar arrangement, the Corporation may create a trust fund or other form of self-insurance arrangement for the benefit of any Indemnitee or such other person to the fullest extent authorized by Delaware Law.

SECTION 10
General Provisions

        10.1     Fixing Record Date.     In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect to any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix in advance a record date which shall not be more than 60 nor less than ten days before the date of such meeting, nor more than 60 days prior to any other action. Except as otherwise provided in the Bylaws, a determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting, provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

        10.2     Dividends.     Dividends upon the Capital Stock of the Corporation, subject to the provisions of the Certificate of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the Certificate of Incorporation. Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for such other purpose as the directors shall think conducive to the interest of the Corporation, and the directors may modify or abolish any such reserve in the manner in which it was created.

        10.3     Checks.     All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

        10.4     Fiscal Year.     The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

        10.5     Seal.     The corporate seal shall have inscribed thereon the name of the Corporation and shall be in such form as may be approved from time to time by the incorporator, or, after the appointment of directors, the Board of Directors. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

SECTION 11
Definitions

        The following terms, for all purposes of the Bylaws, shall have the following meaning:

        "Affiliate" or "Associate" shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations promulgated under the Securities Exchange Act of 1934, as amended (the term "registrant" in such Rule 12b-2 meaning in this case the Corporation).

         A person shall be deemed to be the "Beneficial Owner" of any shares of Capital Stock (regardless whether owned of record):

        (1)     Which that person or any of its Affiliates or Associates, directly or indirectly, owns beneficially;

        (2)     Which such person or any of its Affiliates or Associates has (A) the right to acquire (whether exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (B) the right to vote pursuant to any agreement, arrangement or understanding; or

        (3)     Which are beneficially owned, directly or indirectly, by any other person with which such person or any of its Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of voting capital stock of the Corporation or any Subsidiaries.

        "Capital Stock" means any Common Stock, Preferred Stock or other shares of capital stock of the Corporation.

        "Certificate of Incorporation" shall mean the certificate of incorporation of the Corporation, as it may be amended from time to time, including by means of one or more certificates of designation.

        "Claim" shall mean any threatened, pending or completed claim, action, suit or proceeding, including appeals, whether civil, criminal, administrative or investigative and whether made judicially or extra-judicially, including any action by or in the right of the Corporation, or any separate issue or matter therein, as the context requires.

        "Common Stock" shall mean the common stock of the Corporation, as provided for in the Certificate of Incorporation.

        "Delaware Law" shall mean the General Corporation Law of the State of Delaware.

         "Determining Body" shall mean (i) those members of the Board of Directors who do not have a direct or indirect interest the Claim for which indemnification is being sought ("Impartial Directors"), if there are at least two Impartial Directors, (ii) a committee of at least two Impartial Directors appointed by the Board of Directors or a duly authorized committee thereof (regardless of whether the directors voting on such appointment are Impartial Directors) and composed of Impartial Directors, (iii) if there are fewer than two Impartial Directors or if the Board of Directors or a duly authorized committee thereof so directs (regardless whether the members thereof are Impartial Directors), independent legal counsel, which may be the regular outside counsel of the Corporation, as determined by the Impartial Directors or, if no such directors exist, the full Board of Directors or (iv) the stockholders.

        "Disbursing Officer" shall mean the Treasurer of the Corporation or, if the Treasurer has a direct or indirect interest in the Claim for which indemnification is being sought, any officer who does not have such an interest and who is designated by the Chairman of the Board to be the Disbursing Officer with respect to indemnification requests related to the Claim, which designation shall be made promptly after receipt of the initial request for indemnification with respect to such Claim.

        "Expenses" shall mean any expenses or costs, including, without limitation, attorney's fees, judgments, punitive or exemplary damages, fines, excise taxes or amounts paid in settlement.

        "Indemnitee" shall mean any person who is or was a director or officer of the Corporation or is or was serving at the request of the Corporation as a director, officer or fiduciary of another corporation, partnership, joint venture, trust or other enterprise (including, without limitation, employee benefit plans of the Corporation).

        "Preferred Stock" shall mean the preferred stock of the Corporation, as provided for in the Certificate of Incorporation.

        "Total Voting Power" shall mean the total number of votes that the holders of Capital Stock are entitled to cast with respect to the election of directors or, if such term is used in reference to any other particular matter properly brought before the stockholders for their consideration and vote, means the total number of such votes that are entitled to be cast with respect to such matter.

SECTION 12
Amendments

        The Corporation's Bylaws may be altered, amended, or repealed or new Bylaws may be adopted by:

                (a)     the stockholders, but only upon the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class; or

                (b) the Board of Directors, but only upon the affirmative vote of a majority of the entire Board of Directors.

EX-4.1 4 exhibit41.htm

Exhibit 4.1

CERTIFICATE OF DESIGNATIONS

of

8% SERIES A REDEEMABLE PREFERRED STOCK

of

ASCENT ENERGY INC.

(Pursuant to Section 151(g) of the
Delaware General Corporation Law)

        Ascent Energy Inc., a corporation organized and existing under the laws of the State of Delaware (the "Company"), hereby certifies that the following resolution was duly adopted by the board of directors of the Company (the "Board of Directors") by unanimous written consent dated _______, 2001, pursuant to Section 151(g) of the Delaware General Corporation Law:

        RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors in accordance with the provisions of the Certificate of Incorporation of the Company, the Board of Directors hereby creates a series of Preferred Stock, par value $0.001 per share, of the Company and hereby states the designation and number of shares, and fixes the relative rights, preferences and limitations thereof as follows:

        Section 1.     Designation and Amount.     The shares of this series of Preferred Stock shall be designated as "8% Series A Redeemable Preferred Stock" (the "Series A Redeemable Preferred Stock") and the number of shares constituting the Series A Redeemable Preferred Stock shall be 21,100. Such number of shares may be increased or decreased at any time by resolution of the Board of Directors; provided, however, no decrease shall reduce the number of shares of Series A Redeemable Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights, or warrants for, or upon the conversion or exchange of, any outstanding securities issued by the Company convertible or exchangeable into, Series A Redeemable Preferred Stock.

        Section 2.     Ranking.     The Series A Redeemable Preferred Stock shall rank, as to the payment of dividends and the distribution of the assets upon liquidation, dissolution or winding up of the Company: (a) on a parity with the Company's Series B Convertible Preferred Stock, par value $0.001 per share (the "Series B Convertible Preferred Stock"), (b) senior to or on a parity with all other classes and series of the Company's preferred stock, and (c) senior to the Company's common stock, par value $0.001 per share ("Common Stock").

        Section 3.     Liquidation.     Upon the voluntary or involuntary liquidation, winding up or dissolution of the Company (in connection with the bankruptcy or insolvency of the Company or otherwise), out of the assets available for distribution to shareholders, the holders of Series A Redeemable Preferred Stock shall be entitled to receive, in preference to any payment or distribution to the holders of Common Stock or any other stock of the Company ranking junior to the Series A Redeemable Preferred Stock, as to dividends, liquidation, dissolution or winding up, $1,000 per share (the "Preferred Liquidation Value") plus an amount equal to all Preferred Dividends (as defined in Section 4 below) (whether or not earned or declared) accrued and unpaid on each such share up to and including the date of final distribution to such holders. After the Preferred Liquidation Value and all accrued and unpaid Preferred Dividends have been paid on the Series A Redeemable Preferred Stock, the remaining assets shall be paid to the holders of Common Stock and other junior classes of stock in accordance with their respective priority, if any. In the event the net assets of the Company are insufficient to pay the holders of the Series A Redeemable Preferred Stock the full amount of their preference set forth above and the holders of any other series of capital stock of the Company ranking on a parity with the Series A Redeemable Preferred Stock the liquidating payments to which they are entitled, then the remaining net assets of the Company shall be divided among and paid to the holders of the shares of Series A Redeemable Preferred Stock and any such other capital stock of the Company ranking on a parity with the Series A Redeemable Preferred Stock ratably per share in proportion to the full per share amounts to which they would be entitled if all amounts payable thereon were paid in full, and the holders of Common Stock and other junior classes of stock will receive nothing. Neither a merger or consolidation of the Company with or into any other corporation or entity nor the sale of all or substantially all of the assets of the Company shall be deemed to be a liquidation, dissolution or winding up within the meaning of this provision.

        Section 4.     Dividends.     The Series A Redeemable Preferred Stock is entitled to receive, out of legally available funds, preferential cumulative dividends from the issuance date thereof at the annual rate of eight percent (8%) of the Preferred Liquidation Value per share ("Preferred Dividends"). All Preferred Dividends, if declared by the Board of Directors, shall be payable quarterly and promptly after the tenth business day of each January, April, July and October of each year (each, a "Dividend Payment Date"), commencing on July 10, 2001, to holders of record on the record date, which the Board of Directors shall fix not more than sixty (60) days or less than ten (10) days preceding a Dividend Payment Date. As provided below in Section 7(d), Preferred Dividends shall cease to accrue on shares of Series A Redeemable Preferred Stock on the date of their redemption. No dividend shall be declared on any other series or class or classes of stock to which the Series A Redeemable Preferred Stock ranks prior as to dividends or liquidation, in respect of any period, nor shall any shares of any such series or class be redeemed, purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series A Redeemable Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. No dividend shall be declared on any other series or class or classes of stock ranking on a parity with the Series A Redeemable Preferred Stock, as to dividends, in respect of any quarterly period, nor shall any shares of any such series or class be redeemed or purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series A Redeemable Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. Preferred Dividends shall also be payable upon any Redemption Date (as defined in Section 7(c) below) and upon the final distribution date relating to the dissolution, liquidation or winding up of the Company. Preferred Dividends shall begin to accrue on outstanding shares of Series A Redeemable Preferred Stock and to accumulate from the issuance date of such shares whether or not earned or declared, but Preferred Dividends for any period less than a full quarterly period between Dividend Payment Dates shall be computed on the basis of a 365-day year for the actual number of days elapsed. Preferred Dividends shall accrue whether or not there shall be (at the time any such dividend becomes payable or at any other time) profits, surplus or other funds of the Company legally available for the payment of dividends. Accumulations of dividends on shares of Series A Redeemable Preferred Stock shall not bear interest.

        Section 5.     Conversion Rights.     The Series A Redeemable Preferred Stock is not convertible into or exchangeable for any securities or other property of the Company.

        Section 6.     Voting Rights.

                    (a)     Except as set forth below or as otherwise provided by Delaware law, holders of shares of Series A Redeemable Preferred Stock shall not be entitled to vote such shares; provided, that in all cases where the holders of shares of Series A Redeemable Preferred Stock have the right to vote such shares, such holders shall be entitled to one vote for each such share held by them.

                    (b)     Without the affirmative vote of the holders of not less than a majority of the shares of Series A Redeemable Preferred Stock outstanding, voting together as a single class, the Company shall not amend or waive any of the provisions of the Certificate of Incorporation or this Certificate of Designations, which would materially and adversely affect any right, preference or privilege of the Series A Redeemable Preferred Stock or of the holders thereof; provided, however, that any increase in the amount of authorized Preferred Stock or the creation and/or issuance of other series of Preferred Stock, in each case ranking on a parity with or junior to the Series A Redeemable Preferred Stock, shall not be deemed to materially and adversely affect such rights, preferences or privileges and shall not require the consent of the holders of the then outstanding Series A Redeemable Preferred Stock; and provided further, that the authorization and/or issuance of additional shares of Series A Redeemable Preferred Stock and/or the creation and/or issuance of other series or classes of preferred stock ranking prior to the Series A Redeemable Preferred Stock shall be deemed to materially and adversely affect such rights, preferences and privileges.

        Section 7.     Redemption.

                    (a)     On the fifth anniversary of the date that the Series A Redeemable Preferred Stock was issued (the "Mandatory Redemption Date"), the Company shall redeem from any source of funds legally available therefore, in the manner provided herein, all of the shares of Series A Redeemable Preferred Stock then outstanding, at a cash price per share equal to 100% of the Preferred Liquidation Value plus an amount equal to all Preferred Dividends (whether or not earned or declared) accrued and unpaid on each such share up to and including the date fixed for redemption (the "Redemption Price"), in immediately available funds. Any such redemption shall be conducted in accordance with Section 7(c) below.

                    (b)     The Company shall have the right, at any time and from time to time, on and after the date of issuance, and at its sole option and election, to redeem the shares of Series A Redeemable Preferred Stock, in whole or in part, at the Redemption Price. Any such redemption shall be conducted in accordance with Section 7(c). If less than all the outstanding shares of Series A Redeemable Preferred Stock are to be redeemed, the number of shares of Series A Redeemable Preferred Stock to be redeemed shall be as determined by the Board of Directors. Any such partial redemption shall be effected on a pro rata basis.

                    (c)     The Company shall provide each holder of Series A Redeemable Preferred Stock with a written notice of redemption (addressed to the holder at its address as it appears on the stock transfer books of the Company), not earlier than sixty (60) nor later than twenty (20) days before the date fixed for redemption. The notice of redemption shall specify (i) the date fixed for redemption (the "Redemption Date"); (ii) whether all or less than all of the outstanding shares of Series A Redeemable Preferred Stock are to be redeemed and the total number of shares of the Series A Redeemable Preferred Stock to be redeemed; (iii) the amount of the Redemption Price; (iv) whether the redemption is an optional redemption or a mandatory redemption; and (v) that the holder's are to surrender to the Company, at the place or places the holders of Series A Redeemable Preferred Stock may obtain payment of the Redemption Price, their certificates in the manner designated. If funds are available on the date fixed for redemption, then whether or not shares are surrendered for payment of the Redemption Price, the shares of Series A Redeemable Preferred Stock shall no longer be outstanding and the holders thereof shall cease to be Series A Redeemable Preferred Stock holders of the Company with respect to the shares redeemed on and after the date fixed for redemption and shall be entitled to receive the Redemption Price, without interest, upon the surrender of the share certificate. On or before the applicable Redemption Date, each holder of shares of Series A Redeemable Preferred Stock to be redeemed on such Redemption Date shall surrender the certificate or certificates representing such shares to the Company, duly endorsed, in the manner and at the place designated in the Redemption Notice and there upon the Redemption Price for such shares shall be payable in cash to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered certificate shall be cancelled and retired. In the event less than all of the shares of Series A Redeemable Preferred Stock represented by a certificate are redeemed, a new certificate representing the unredeemed shares of Series A Redeemable Preferred Stock shall be issued forthwith. Failure to mail the notice described in the first sentence of this Section 7(c), or any defect therein or in the mailing thereof, to any particular holder shall not affect the validity of the proceeding for the redemption of any shares so to be redeemed from any other holder. In order to facilitate the redemption of shares of Series A Redeemable Preferred Stock, the Board of Directors may fix a record date for the determination of shares of Series A Redeemable Preferred Stock to be redeemed, or may cause the transfer books of the Company for the Series A Redeemable Preferred Stock to be closed, not more than sixty (60) days or less than twenty (20) days prior to the applicable Redemption Date.

                    (d)     Notice of redemption having been given as provided in Section 7(c) above, notwithstanding that any certificates for such shares shall not have been surrendered for cancellation, unless the Company defaults in the payment in full of the applicable redemption price, from and after the Redemption Date designated in the notice of redemption (i) the shares represented thereby shall no longer be deemed outstanding, (ii) the rights to receive dividends thereon shall cease to accrue and (iii) all rights of the holders of shares of Series A Redeemable Preferred Stock to be redeemed shall cease and terminate, excepting only the right to receive the Redemption Price therefor.

                    (e)     The Company shall not be required to establish any sinking or retirement fund with respect to the shares of Series A Redeemable Preferred Stock.

        Section 8.     Change of Control Redemption.

                    (a)     Upon the occurrence of a Change of Control (as defined below) each holder of Series A Redeemable Preferred Stock shall have the right to require the Company to redeem such Series A Redeemable Preferred Stock, in cash at a price per share equal to 101% of the Preferred Liquidation Value plus an amount equal to all Preferred Dividends (whether or not earned or declared) accrued and unpaid on each such share up to and including the date fixed for redemption. Any such redemption shall be conducted in accordance with Section 7(c). For purposes of this Section 8, "Change of Control" means the occurrence of any of the following events:

        (i)     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 any stockholder that owns individually, or with its affiliates, in excess of 25% of the voting power of all classes of voting stock of the Company on the initial date of issuance of the Series A Preferred Stock, becomes the "beneficial owner" (as defined in Rules 13d-3 under the Exchange Act, except that a person or entity shall be deemed to have "beneficial ownership" of all securities that such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than a majority of the voting power of all classes of voting stock of the Company;

        (ii)     the direct or indirect sale, lease, exchange or other transfer of all or substantially all of the assets of the Company to any "person" or "group" (within the meaning of Section 13(d) or 14(d) of the Exchange Act), other than a subsidiary or other affiliate of the Company;

        (iii)     the consummation of any consolidation or merger of the Company with or into another entity with the effect that the stockholders of the Company as of the date of issuance of the Series A Redeemable Preferred Stock hold less than 51% of the combined voting power of the outstanding voting securities of the surviving entity of such merger or the entity resulting from such consolidation ordinarily having the right to vote in the election of directors immediately after such merger or consolidation;

        (iv)     during any consecutive two-year period, individuals who at the beginning of such period constituted the Board of Directors of the Company (together with any new directors whose election to such Board of Directors, or whose nomination for election by the stockholders of the Company, was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of the Company then in office; or

        (v)     the Company is liquidated or dissolved or adopts a plan of liquidation or dissolution.     

                    (b)     The Company shall provide each holder of Series A Redeemable Preferred Stock with a written notice of the occurrence of a Change of Control (addressed to the holder at its address as it appears on the stock transfer books of the Company), not earlier than sixty (60) nor later than twenty (20) days before the date of such occurrence. Such notice shall specify the date for redemption payments to be made, which shall be a date not later than the date of the occurrence of the Change of Control.

        Section 9.     Failure to Redeem.     If the Company is unable or shall fail to discharge its obligation to redeem all outstanding shares of Series A Redeemable Preferred Stock pursuant to Section 7(a) or 8(a) (each, a "Mandatory Redemption Obligation"), such Mandatory Redemption Obligation shall be discharged as soon as the Company is able to discharge such Mandatory Redemption Obligation. The shares of Series A Redeemable Preferred Stock not redeemed shall remain outstanding and entitled to all the rights and preferences provided herein. If and so long as any Mandatory Redemption Obligation with respect to the Series A Redeemable Preferred Stock shall not be fully discharged, the Company shall not declare or make any dividend or other distribution or, directly or indirectly, redeem, purchase, or otherwise acquire for any consideration any other series or class or classes of stock to which the Series A Redeemable Preferred Stock ranks equal or prior as to dividends or liquidation or discharge any mandatory or optional redemption, sinking fund or other similar obligation in respect of any such securities (except in connection with a redemption, sinking fund or other similar obligation to be satisfied pro rata with the Series A Redeemable Preferred Stock).

        Section 10.     Reacquired Shares.     Any shares of Series A Redeemable Preferred Stock converted, exchanged, redeemed, purchased or otherwise acquired by the Company in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock without designation as to series and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors as permitted by the Certificate of Incorporation or as otherwise permitted under Delaware law.

        Section 11.     Preemptive Rights.     The Series A Redeemable Preferred Stock is not entitled to any preemptive rights in respect of any securities of the Company.

        Section 12.     Severability of Provisions.     Whenever possible, each provision hereof shall be interpreted in a manner as to be effective and valid under applicable law, but if any provision hereof is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining provisions hereof. If a court of competent jurisdiction should determine that a provision hereof would be valid or enforceable if a period of time were extended or shortened or a particular percentage were increased or decreased, then such court may make such change as shall be necessary to render the provision in question effective and valid under applicable law.

        Section 13.     Replacement.     Upon receipt of evidence satisfactory to the Company (an affidavit of the registered holder shall be satisfactory) of the ownership and the loss, theft, destruction or mutilation of any certificate evidencing shares of Series A Redeemable Preferred Stock, and, in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company (provided, that, if the holder is a financial institution or other institutional investor, its own agreement shall be satisfactory), or, in the case of any such mutilation, upon surrender of such certificate, the Company shall execute and deliver in lieu of such certificate a new certificate of like kind representing the number of shares of Series A Redeemable Preferred Stock of such class represented by such lost, stolen, destroyed or mutilated certificate and dated the date of the lost, stolen, destroyed or mutilated certificate, and dividends shall accrue on the Series A Redeemable Preferred Stock represented by such new certificate from the date to which dividends have been fully paid on the Series A Redeemable Preferred Stock represented by the lost, stolen, destroyed or mutilated certificate.

        Section 14.     Successors and Transferees.     The provisions applicable to shares of Series A Redeemable Preferred Stock shall bind and inure to the benefit of and be enforceable by the Company, the respective successors to the Company, and by any record holder of shares of Series A Redeemable Preferred Stock.

        IN WITNESS WHEREOF, Ascent Energy Inc. has caused this Certificate of Designations to be signed by the undersigned on this __ day of __________, 2001.

ASCENT ENERGY INC.

By:___________________________
                     Jeffrey Clarke
                         President

EX-4.2 5 exhibit42.htm

Exhibit 4.2

Number
- -  Shares
 - -

ASCENT ENERGY INC.
ORGANIZED UNDER THE LAWS OF THE STATE OF DELAWARE
8% SERIES A REDEEMABLE PREFERRED STOCK

This Certifies That _________________________ is the registered holder of________________ shares of 8% Series A Redeemable Preferred Stock, $0.001 par value, of the above Corporation, which are fully paid and non-assessable and transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this Certificate properly endorsed.

In Witness Whereof, the said Corporation has caused this Certificate to be signed by its duly authorized officers and its Seal to be hereunto affixed this ____ day of __________, ______.

                                     _______________________         _______________________
                                                       President                                            Secretary

PREFERRED

$0.001
par value

STOCK CERTIFICATE

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED.

ANY STOCKHOLDER MAY OBTAIN WITHOUT CHARGE, BY REQUEST TO THE OFFICE OF THE SECRETARY OF THE COMPANY, A COPY OF A STATEMENT OF THE RIGHTS, PREFERENCES, PRIVILEGES AND RESTRICTIONS GRANTED TO OR IMPOSED UPON THE SHARES OF SERIES A PREFERRED STOCK REPRESENTED HEREBY AND OF EACH OTHER CLASS OR SERIES OF SHARES AUTHORIZED TO BE ISSUED BY THE COMPANY AND UPON THE HOLDERS THEREOF.

No. - -

Ascent Energy Inc.

CERTIFICATE
FOR

- -

SHARES

OF

Series A Redeemable
Preferred Stock

ISSUED TO

_____________________

DATED

__________, _____

        For value received, ______________________ hereby sells, assigns and transfers unto _______________________________ Shares of the Preferred Stock represented by the within Certificate, and do hereby irrevocably constitute and appoint ______________________ Attorney to transfer the said Stock on the books of and within named Corporation with full power of substitution in the premises.

Dated: ________________________

In presence of: __________________

NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.

EX-4.4 6 exhibit44.htm

Exhibit 4.4

Number
- - Shares
- -

ASCENT ENERGY INC.
ORGANIZED UNDER THE LAWS OF THE STATE OF DELAWARE
8% SERIES B CONVERTIBLE PREFERRED STOCK

This Certifies That _________________________ is the registered holder of________________ shares of 8% Series B Convertible Preferred Stock, $0.001 par value, of the above Corporation, which are fully paid and non-assessable and transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this Certificate properly endorsed.

In Witness Whereof, the said Corporation has caused this Certificate to be signed by its duly authorized officers and its Seal to be hereunto affixed this ____ day of __________, _____.

                                     _______________________         _______________________
                                                       President                                            Secretary

PREFERRED

$0.001
par value

STOCK CERTIFICATE

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED.

ANY STOCKHOLDER MAY OBTAIN WITHOUT CHARGE, BY REQUEST TO THE OFFICE OF THE SECRETARY OF THE COMPANY, A COPY OF A STATEMENT OF THE RIGHTS, PREFERENCES, PRIVILEGES AND RESTRICTIONS GRANTED TO OR IMPOSED UPON THE SHARES OF SERIES B PREFERRED STOCK REPRESENTED HEREBY AND OF EACH OTHER CLASS OR SERIES OF SHARES AUTHORIZED TO BE ISSUED BY THE COMPANY AND UPON THE HOLDERS THEREOF.

No. - -

Ascent Energy Inc.

CERTIFICATE
FOR

- -

SHARES

OF

Series B Convertible
Preferred Stock

ISSUED TO

_____________________

DATED

________, ____

        For value received, ______________________ hereby sells, assigns and transfers unto _______________________________ Shares of the Preferred Stock represented by the within Certificate, and do hereby irrevocably constitute and appoint ______________________ Attorney to transfer the said Stock on the books of and within named Corporation with full power of substitution in the premises.

Dated: ________________________

In presence of: __________________

NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.

EX-4.5 7 exhibit45.htm

Exhibit 4.5

Warrant No. _____                                                                                                          Warrants to Purchase

______________
shares of Common Stock

                       THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED.

WARRANT

To Purchase Common Stock of

ASCENT ENERGY INC.

THIS WARRANT CERTIFICATE certifies that _______________ (the "Holder"), or registered assigns, is entitled to purchase from Ascent Energy Inc., a Delaware corporation (the "Company"), at any time during the period commencing on the date hereof, but not later than 5:00 p.m., Central time, on June 1, 2011 (the "Expiration Date"), that number of fully paid and non–assessable shares of Common Stock (each, a "Warrant Share"), $0.001 par value per share (the "Common Stock"), as set forth above at an exercise price of $__________ (the "Exercise Price") per Warrant Share, all on the terms and conditions hereinbelow provided. The number of Warrant Shares issuable upon exercise of the Warrant and the Exercise Price are subject to adjustment on the occurrence of certain events set forth below.

            Section 1.      Exercise of Warrant.

                        (a)     The holder of this Warrant may, at any time on and after the date hereof, but not later than the Expiration Date, exercise this Warrant in whole at any time or in part from time to time for the number of Warrant Shares which the Holder is then entitled to purchase hereunder. The Holder may exercise this Warrant, in whole or in part, by either of the following methods:

                                 (i)     The Holder may deliver to the Company (A) a written notice of the Holder's election to exercise this Warrant, which notice shall specify the number of Warrant Shares to be purchased, (B) this Warrant and (C) a sum equal to the aggregate Exercise Price for the number of Warrant Shares being purchased in immediately available funds; or

                                (ii)      If the Common Stock is then traded on a national securities exchange or quoted on the Nasdaq Stock Market or any other over–the–counter securities market, the Holder may also exercise this Warrant, in whole or in part, in a "cashless" or "net–issue" exercise by delivering to the Company (A) a written notice of the Holder's election to exercise this Warrant, which notice shall specify the number of Warrant Shares to be purchased and the number of Warrant Shares with respect to which this Warrant is being surrendered in payment of the aggregate Exercise Price for the Warrant Shares to be purchased by the Holder, and (B) this Warrant. For purposes of this Section 1(a)(ii), each Warrant Share as to which this Warrant is surrendered will be attributed a value equal to the average of the difference between the daily last sales price reported on the primary national securities exchange, Nasdaq Stock Market or over–the–counter market on which the Common Stock is then previously traded or quoted for 20 Business Days preceding and the Exercise Price for each such Warrant.

                        (c)      Any notice required under this Section 1 may be given by delivering this Warrant together with an executed copy of the Subscription Form set out at the end of this Warrant. Upon delivery thereof, the Company shall as promptly as practicable and in any event within ten calendar days thereafter, cause to be executed and delivered to the Holder a certificate or certificates representing the aggregate number of fully–paid and nonassessable shares of Common Stock issuable upon such exercise. The stock certificate or certificates for Warrant Shares so delivered shall be in such denominations as may be specified in said notice and shall be registered in the name of the Holder or, subject to Section 1(b), such other name or names as shall be designated in said notice. If this Warrant shall have been exercised only in part, the Company shall, at the time of delivery of said certificate or certificates, deliver to the Holder a new Warrant dated the date it is issued, evidencing the rights of the Holder to purchase the remaining Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical to this Warrant, or, at the request of the Holder, appropriate notation may be made on this Warrant and the Warrant shall be returned to the Holder.

                        (d)      The Company shall pay all expenses, taxes and other charges payable in connection with the preparation, issue and delivery of stock certificates under this Section 1.

                        (e)      All shares of Common Stock issuable upon the exercise of this Warrant shall be validly issued, fully paid and nonassessable, and free from all liens created by the Company and other encumbrances thereon.

                        (f)      Except as may otherwise be required by law, the Company will not close its books against the transfer of this Warrant in any manner which interferes with the timely exercise of this Warrant.

            Section 2.     Transfer, Division and Combination.

                        (a)      Subject to Section 6, this Warrant and all rights hereunder are transferable, in whole or in part, on the books of the Company to be maintained for such purpose, upon surrender of this Warrant, together with a written assignment in the form set out at the end of this Warrant duly executed by the Holder or its agent or attorney and payment of funds sufficient to pay any stock transfer taxes payable upon the making of such transfer. Upon such surrender and payment the Company shall, subject to Section 6, execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denominations specified in such instrument of assignment, and this Warrant shall promptly be canceled.

                        (b)      The Company shall pay all expenses, taxes and other charges incurred by the Company in the performance of its obligations in connection with the preparation, issue and delivery of Warrants under this Section 2.

            Section 3.     Adjustment of Stock Unit or Exercise Price. The Exercise Price and the number of Warrant Shares purchasable upon the exercise of this Warrant are subject to adjustment from time to time upon the occurrence of the events specified in this Section 3.

                        (a)      If the Company shall (i) pay a stock dividend on its capital stock, (ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into smaller number of shares of Common Stock or (iv) issue any shares of its capital stock in a reclassification of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), the number of Warrant Shares purchasable upon exercise of this Warrant immediately prior thereto shall be adjusted so that the Holder shall be entitled to receive the kind and number of Warrant Shares or other securities of the Company which the Holder would have owned or have been entitled to receive after the happening of any of the events described above, had such Warrant been exercised immediately prior to the happening of such event or any record date with respect thereto.

                        (b)      In the event of any capital reorganization or any reclassification of the Common Stock (except as provided in Section 3(a) above or (g)) the Holder upon exercise thereof shall be entitled to receive, in lieu of the Common Stock to which he would have become entitled upon exercise immediately prior such reorganization or reclassification, the shares (of any class or classes) or other securities or property of the Company that he would have been entitled to receive at the same aggregate Exercise Price upon such reorganization or reclassification if this Warrant had been exercised immediately prior thereto; and in any such case, appropriate provision (as determined in good faith by the Board of Directors of the Company, whose determination shall be conclusive) shall be made for the application of this Section 3 with respect to the rights and interests thereafter of the Holder (including the allocation of the adjusted Exercise Price between or among shares of classes of capital stock), to the end that this Section 3 (including the adjustments of the number of shares of Common Stock or other securities purchasable and the Exercise Price thereof) shall thereafter be reflected, as nearly as reasonably practicable, in all subsequent exercises of this Warrant for any shares or securities or other property thereafter deliverable upon the exercise of this Warrant.

                        (c)      Except for adjustments required by Section 3, no adjustment in the number of Warrant Shares purchasable hereunder shall be required unless such adjustment would require an increase or decrease of at least one percent (1%) in the number of Warrant Shares purchasable upon the exercise of this Warrant; provided, however, that any adjustments which by reason of this Section 3(c) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations shall be made to the nearest cent and to the nearest one–hundredth of a Warrant Share, as the case may be.

                        (d)      Whenever the number of Warrant Shares purchasable upon the exercise of this Warrant is adjusted as herein provided (whether or not the Company then or thereafter elects to issue additional Warrants in substitution for an adjustment in the number of Shares as provided in Section 3(g)), the Exercise Price payable upon exercise of this Warrant shall be adjusted by multiplying the Exercise Price immediately prior to such adjustment by a fraction, of which the numerator shall be the number of Warrant Shares purchasable upon the exercise of this Warrant immediately prior to such adjustment, and of which the denominator shall be the number of Warrant Shares so purchasable immediately thereafter.

                        (e)      For the purpose of this Section 3, the term "shares of stock" shall mean (i) the class of stock designated as the Common Stock of the Company at the date of this Agreement, or (ii) any other class of stock resulting from successive changes or reclassification of such shares consisting solely of changes in par value, or from par value to no par value, or from no par value to par value. If at any time, as a result of an adjustment made pursuant to Section 3(a) or (b), the Holder shall become entitled to purchase any shares of the Company other than Warrant Shares, thereafter the number of such other shares so purchasable upon exercise of this Warrant and the Exercise Price of such shares so purchasable upon exercise of this Warrant shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions contained in Sections 3(a) through (d), which provisions shall apply on like terms to any such other shares.

                        (f)      Except as provided in this Section 3, no adjustment in respect of any dividends shall be made during the term of a Warrant or upon the exercise of a Warrant.

                        (g)      In case of any consolidation of the Company with or merger of the Company into another corporation or other entity or in case of any sale or conveyance to another person of the property of the Company as an entirety or substantially as an entirety, the Company or such successor or purchasing corporation or other entity, as the case may be, shall execute and deliver to the Holder an agreement that the Holder shall have the right thereafter upon payment of the Exercise Price in effect immediately prior to such action to purchase upon exercise of the each Warrant the kind and amount of shares and other securities and property which he would have owned or have been entitled to receive after the happening of such consolidation, merger, sale or conveyance had the Warrant been exercised immediately prior to such action. The Company shall promptly provide to Holder notice of the execution of any such agreement. Such agreement shall provide for adjustments, which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 3. The provisions of this Section 3(g) shall similarly apply to successive consolidations, mergers, sales or conveyances.

            Section 4.     Notices.

                        (a)      Upon any adjustment of the number of shares purchasable upon exercise of this Warrant or the Exercise Price, the Company within 20 calendar days thereafter shall cause to be mailed to the Holder a certificate setting forth the Exercise Price and either the number of Warrant Shares purchasable upon exercise of each Warrant or the replacement warrant to be issued for this Warrant, as the case may be, after such adjustment and setting forth in reasonable detail the method of calculation and the facts upon which such adjustment was made, which certificate shall be conclusive evidence of the correctness of the matters set forth therein.

                        (b) If:

                                 (i)     the Company shall declare any dividend payable in any securities upon its Common Stock or make any distribution (other than a cash dividend) to the holders of its shares of Common Stock, or

                                 (ii)     the Company shall offer to the holders of its shares of Common Stock any additional shares of Common Stock or securities convertible into shares of Common Stock or any right to subscribe thereto, or

                                 (iii)     there shall be a dissolution, liquidation or winding up of the Company (other than in connection with a consolidation, merger or sale of all or substantially all of its property, assets and business as an entirety),

the Company shall cause written notice of such event to be given to the Holder at least ten calendar days (or 20 calendar days in any case specified in Section 4(b)(iii)) prior to the date fixed as a record date for the date of closing the transfer books for the determination of the stockholders entitled to such dividend, distribution or subscription rights, or for the determination of stockholders entitled to vote on such proposed dissolution, liquidation or winding up. Such notice shall specify such record date or the date of closing the transfer books, as the case may be. The failure to give the notice required by this Section 4 or any defect therein shall not affect the legality or validity of any distribution, right, warrant, dissolution, liquidation or winding up or the vote upon or any other action taken in connection therewith.

            Section 5.     Restrictions on Transfer.

                        (a)      The Holder by its acceptance of this Warrant understands and agrees that this Warrant and the Warrant Shares have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities saws, and that accordingly, they will not be fully transferable except as permitted under various exemptions contained in the Securities Act and applicable state securities laws, or upon satisfaction of the registration and prospectus delivery requirements of the Securities Act and applicable state and securities laws. The Holder acknowledges that it must bear the economic risk of its investment in the Warrant and Warrant Shares for an indefinite period of time since they have not been registered under the Securities Act and applicable state securities laws and therefore cannot be sold unless they are subsequently registered or an exemption from registration is available.

                        (b)      The Holder agrees that without the prior written consent of the Company, which may be withheld by the Company in its sole discretion, it shall not transfer the Warrant or any interest therein to anyone other than a member of its Group. For purposes of this Section 5, a "Group" shall mean:

                                 (i)     if the Holder is an individual, the Holder, the spouse, lineal descendants and adopted children of the Holder and any trust for the benefit of any of the foregoing; and

                                 (ii)     if the Holder is a corporation, limited liability company or partnership, (A) such corporation, limited liability company or partnership, (B) any corporation or other business organization to which such corporation, limited liability company or partnership shall sell, license or transfer all or substantially all of its assets or with which it shall be merged, (C) with respect to any limited liability company or partnership, any partner (general or limited) or member thereof and (D) any affiliate of such corporation, limited liability company or partnership.

        The Company shall from time to time, subject to the limitations of this Section 5, register the permitted transfer of this Warrant upon the records to be maintained by it for that purpose, upon surrender thereof duly endorsed or accompanied (if so required by it) by a written instrument or instruments of transfer in form satisfactory to the Company, duly executed by the registered holder or holders thereof or by the duly appointed legal representative thereof or by a duly authorized attorney. Upon any such registration of transfer, a replacement warrant shall be issued to the transferee(s) and the surrendered Warrant shall be cancelled by the Company.

        The Holder agrees that prior to any proposed transfer of the Warrant the Holder will deliver to the Company:

                                 (i)    an agreement by such transferee to the impression of the restrictive legend set forth in Section 5(d) on the Warrant; and 

                                 (ii)    an agreement by such transferee be bound by the provisions of this Warrant.

                        (d)      The Holder agrees that the Warrant will bear a legend in substantially the following form:

                        "THE SECURITIS EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS TH SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED."

                        (e)      Subject to the terms of this Warrant, this Warrant may be exchanged at the option of the Holder, when surrendered to the Company at its principal office, which is currently located at the address listed in Section 9, for another Warrant of like tenor and representing in the aggregate a like number of Warrant Shares. If the Holder desires to exchange this Warrant it shall deliver a written request to the Company, and shall surrender, duly endorsed or accompanied (if so required by the Company) by a written instrument or instruments of transfer form satisfactory to the Company, the Warrant Certificate or Certificates to be so exchanged.

            Section 6.     Limitation of Liability. No provision hereof, in the absence of affirmative action by the Holder to purchase shares of Common Stock, and no mere enumeration herein of the rights or privileges of the holder hereof, shall give rise to any liability of the Holder for the purchase price of the Warrant Shares or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

            Section 7.     Loss or Destruction of Warrant. Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon receipt of indemnity or security satisfactory to the Company or, in the case of any such mutilation, upon surrender and cancellation of this Warrant, the Company will make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the right to purchase the same aggregate number of shares of Common Stock.

            Section 8.     Amendments. The terms of this Warrant may be amended, and the observance of any term therein may be waived, but only with the written consent of the Company and the Holder.

            Section 9.     Notices Generally. All communications (including all required or permitted notices) pursuant to the provisions hereof shall be in writing and shall be sent,

                        (a)      if to the Holder at its address for notices specified beneath its name on the signature page hereof or at such other address as it may have furnished in writing to the Company.

    (b)     if to the Company:

                                Ascent Energy Inc.
                                650 Poydras Street, Suite 2200
                                New Orleans, Louisiana 70130
                                Attn: President

                                or at such other address as it may have furnished in writing to the Holder.

        Any notice or demand authorized by this Warrant to be given or made by the Holder of or on the Company or by the Company to the Holder shall be sufficiently given or made when and if deposited in the mail, first class or registered, postage prepaid, addressed (until another address is provided in writing) as provided in this Section 9.

                        Section 10. GOVERNING LAW. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.

                        IN WITNESS WHEREOF, the Company has caused this Warrant to be signed in its name by its President or a Vice President and its corporate seal to be impressed hereon and attested by its Secretary or an Assistant Secretary.

Dated: _______________, 2001

                                                                                 ASCENT ENERGY INC. 

                                                                                 By:                                                                 
                                                                                    Name:
                                                                                    Title:

ATTEST:

                                                              
Name:
Title:

Address for Notices 

__________________________

__________________________

__________________________

SUBSCRIPTION FORM 

(to be executed only upon exercise of Warrant) 

                                The undersigned registered owner of this Warrant irrevocably exercises this Warrant for and purchases Warrant Shares of Ascent Energy Inc., a Delaware corporation, purchasable with this Warrant, and herewith makes payment therefor (by check in the amount of $_____), or hereby tenders _____ Warrant Shares as payment therefor, all at the price and on the terms and conditions specified in this Warrant and requests that certificates for the shares of Common Stock hereby purchased (and any securities or other property issuable upon such exercise) be issued in the name of and delivered to ______________ whose address is _____________ and, if such Warrant Shares shall not include all of the Warrant Shares issuable as provided in this Warrant that a new Warrant of like tenor and date for the balance of the Warrant Shares issuable thereunder be delivered to the undersigned.

Dated:

_________________________________
(Signature of Registered Owner)

__________________________________
(Street Address)

__________________________________
(City)         (State) (Zip Code)

ASSIGNMENT FORM

                        FOR VALUE RECEIVED the undersigned registered owner of this Warrant hereby sells, assigns and transfers unto the Assignee named below all of the rights of the undersigned under this Warrant, with respect to the number of Warrant Shares set forth below:

No. of Warrant Shares                                                  Name and Address of Assignee

and does hereby irrevocably constitute and appoint _____ Attorney to make sure transfer on the books of Ascent Energy Inc., a Delaware corporation, maintained for the purpose, with full power of substitution in the premises.

Dated:

______________________________
Signature

______________________________
Witness

NOTICE:	The signature to the assignment must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatever.
	The signature must be guaranteed by an institution which is a member of one of the following recognized signature guarantee programs:
	(1)     The Securities Transfer Agents Medallion Program (STAMP);
	(2)     The New York Stock Exchange Medallion Stamp Program (MSP);
	(3)     The Stock Exchange Medallion Program (SEMP).

EX-5 8 exhibit5.htm

Exhibit 5

March 27, 2001

Ascent Energy Inc.
650 Poydras St.
Suite 2200
New Orleans, Louisiana 70130

        Re:     Ascent Energy Inc.
                  Registration Statement on Form S–4

Gentlemen:

        We have acted as counsel to Ascent Energy Inc. (the "Company") in connection with the preparation of the registration statement on Form S–4 (the "Registration Statement") filed by the Company with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"). All terms used without other definitions are intended to have the meanings given to them in the Registration Statement.

        Pursuant to the Agreement and Plan of Merger (the "Merger Agreement"), dated as of January 19, 2001, among the Company, Pontotoc Acquisition Corp., a wholly owned subsidiary of the Company (the "Merger Sub"), and Pontotoc Production, Inc. ("Pontotoc"), the Company, through the Merger Sub, has offered to exchange (the "Exchange Offer") its shares of 8% Series B Convertible Preferred Stock, par value $0.001 per share (the "Preferred Stock"), and cash for each outstanding share of Pontotoc common stock tendered in the Exchange Offer. Following consummation of the Exchange Offer, the Company intends to cause the Merger Sub to merge with Pontotoc. Each share of Pontotoc common stock that is not exchanged or accepted in the Exchange Offer will be converted in the merger into the right to receive the same per share consideration as is being paid in the Exchange Offer. The Registration Statement relates to the registration of the Preferred Stock and an indeterminable number of shares of common stock that may be issued upon the conversion of the Preferred Stock (the "Common Stock" and, together, with the Preferred Stock, the "Shares").

        In rendering the opinions expressed below, we have examined originals, or photostatic or certified copies, of such records and documents of the Company, certificates of officers of the Company and of public officials, and such other documents as we have deemed necessary or advisable for purposes of rendering this opinion. In such examination, we have assumed the genuineness of all signatures, the legal capacity of all individuals who have executed any documents reviewed by us, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified or photostatic copies and the authenticity of the originals of such documents.

        Based upon the foregoing, and subject to the qualifications stated herein, we are of the opinion that:

1.     The Preferred Stock will be validly issued, fully paid and non–assessable when issued upon consummation of the Exchange Offer and the subsequent merger in accordance with the terms of the Merger Agreement.

2.     The issuance of shares of Common Stock, into which the shares of Preferred Stock may be converted, are duly authorized and, when issued in accordance with the Company's certificate of incorporation and certificate of designations, will be validly issued and outstanding, fully paid and non–assessable.

        In connection with our opinions expressed above, we have assumed that, at or prior to the time of the delivery of any such Shares: (i) the Registration Statement shall have been declared effective and such effectiveness shall not have been terminated or rescinded; and (ii) there will not have occurred any change in law affecting the validity of such Shares.

        The foregoing opinion is limited in all respects to the laws of the States of Delaware and Louisiana and federal laws, and we are expressing no opinion as to the effect of the laws of any other jurisdiction, domestic or foreign.

        We consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to us in the prospectus included therein under the caption "Legal Matters." In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Act, or the general rules and regulations of the Commission promulgated thereunder.

                                                                              Very truly yours,

                                                                             /s/ Jones, Walker, Waechter, Poitevent,
                                                                                 Carrere & Denegre, L.L.P.

                                                                             JONES, WALKER, WAECHTER, POITEVENT,
                                                                             CARRÈRE & DENÈGRE, L.L.P.

EX-10.1 9 exhibit101.htm

Exhibit 10.1

STOCKHOLDERS' AGREEMENT 

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

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

          NOW, THEREFORE, the parties hereto agree as follows: 

ARTICLE 1
VOTING AGREEMENT; AGREEMENT TO TENDER 

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

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

ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER

          Each Stockholder, severally and not jointly, represents and warrants to Buyer that:        

          Section 2.1.     Authorization. The execution, delivery and performance by such Stockholder of this Agreement and the consummation by such Stockholder of the transactions contemplated hereby are within the powers of such Stockholder and have been duly authorized by all necessary action. This Agreement constitutes a valid and binding Agreement of such Stockholder.

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

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

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER 

          Buyer represents and warrants to each Stockholder:

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

ARTICLE 4
COVENANTS OF STOCKHOLDER

          Each Stockholder hereby covenants and agrees that:

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

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

ARTICLE 5
MISCELLANEOUS

          Section 5.1.     Further Assurances. Buyer and each Stockholder will each execute and deliver, or cause to be executed and delivered, all further documents and instruments and use all reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations, to consummate and make effective the transactions contemplated by this Agreement.

           Section 5.2.     Amendments; Termination. Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed, in the case of an amendment, by each party to this Agreement or in the case of a waiver, by the party against whom the waiver is to be effective. This Agreement shall terminate upon the termination of the Merger Agreement in accordance with its terms.

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

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

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

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

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

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

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

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

BUYER:

ASCENT ENERGY INC.

By:             /s/ Jeffrey Clarke                    
                    Jeff Clarke
                    President

STOCKHOLDERS:                                                                                           Shares of common
                                                                                                                              stock of the Company
                                                                                                                              owned by Stockholder:

                /s/ James Robson, Jr.                                                                                         569,497
James "Robby" Robson, Jr.

               /s/ Todd Robson                                                                                                 570,051
Todd Robson

            /s/ James Robson, Sr.                                                                                             441,313
James Robson, Sr.

          /s/ Lyle P. Phillips                                                                                                     299,000
Lyle P. Phillips

          /s/ Brian K. Gourley                                                                                                   58,671
Brian K. Gourley

         /s/ Timothy A. Jurek                                                                                                   25,000
Timothy A. Jurek

EX-10.2 10 exhibit102.htm

Exhibit 10.2

LEASE AGREEMENT

By and Between

PONTOTOC GATHERING, L.L.C.

"Lessee"

AND

ENERFIN RESOURCES I LIMITED PARTNERSHIP

"Lessor"

DATED: July 1, 2000

LEASE AGREEMENT

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

SECTION 1. RECITALS

1.1	PGL is in partnership with Pontotoc Production Company, ("PPC") and PPC plans to   develop natural gas from shallow reservoirs in northern Pontotoc, southern Seminole and southeastern Potawatomie Counties, Oklahoma; and,
1.2	Enerfin owns and operates a natural gas pipeline gathering system, the ("Byng") System which is more fully described in Exhibit "A" attached hereto and made a part hereof; and,
1.3	The Byng System is located in the vicinity in which PPC plans to develop natural gas production; and,
1.4	PGL, as Lessee, and Enerfin, as Lessor, desire to enter into a Lease Agreement under the terms and conditions provided herein.

SECTION 2. SCOPE AND USAGE

2.1

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

2.2

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

SECTION 3. OPERATIONS

3.1	Lessee shall assume on the effective date of this Agreement, at its sole risk and expense, the operations of the Byng System in a manner consistent with prudent operating procedures and in accordance with generally accepted industry standards, laws and regulations. Lessee shall operate the Byng System in Low Pressure natural gas service. For purposes of this Agreement, Low Pressure is defined as that pressure at which a pipeline may be operated at under safe operating conditions, but which pressure in no event will exceed the maximum allowable operating pressure ("MAOP") of such pipeline. Notwithstanding the foregoing, Lessee will not allow the operating pressure of any of the pipelines of the Byng System to exceed 250 psig.
3.2	Lessee will perform, at its sole risk and expense, all necessary or appropriate activities concerning the operation, inspection, maintenance, corrosion prevention (including maintaining rectifiers for cathodic protection) and repairs of the Byng System. All such repairs, maintenance, upgrades or improvements performed on the Byng System by Lessee shall remain the property of Lessor.
3.3	Lessee shall comply, at its sole risk and expense, with all of the terms and conditions of the Easements covering the Byng System. Lessor shall provide Lessee with a copy of the Easements of the Byng System and Lessee shall maintain files relative to these Easements during the term of this Agreement including amendments, correspondence and related information and documents. These Easement files shall remain the property of Lessor and upon termination of this Agreement, Lessee shall turn such files and documents over to Lessor.
3.4	Lessee shall be responsible, at its sole risk and expense, for line locates and for complying with the requirements of the "Okie 1–Call" system (or other similar applicable programs) with respect to the Byng System during the term of this Agreement. Prior to commencing operation of any pipeline segment(s) of the Byng System for natural gas service as contemplated herein, Lessee shall install appropriate line markers in Lessee's name upon such pipeline segment(s) that Lessee places in natural gas service.
3.5	Lessee will be responsible, at its sole risk and expense, for procuring any necessary governmental operating or right–of–way permits, documents, approvals, or authorities relating to the use, operation, maintenance, or shutdown of the Byng System.
3.6	Lessee understands that the property leased pursuant to this Agreement does not include compressors, pumps, meters, and/or other equipment which may be necessary in the course of Lessee's operation and use of such property. Lessee will furnish and install, at its sole risk and expense, any equipment or facilities required in the conduct of Lessee's permitted operations of the property. Any equipment or facilities so installed shall meet the operating requirements previously outlined in this Agreement and shall remain the property of Lessee.

SECTION 4.

ALTERATIONS, CONSTRUCTION AND SURRENDER OF THE BYNG SYSTEM

4.1

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

4.2

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

SECTION 5. LEASE RENTAL FEES

5.1	Lessee agrees to pay to Lessor each month as rental for the Byng System, a monthly Lease Rental Fee that shall be the greater of: (i.) Four Percent (4%) of the Gross Sales Revenue for the sale of natural gas received by Lessee (or PPC or the working interest owners of the gas connected to the Byng System); or (ii.) Five Hundred Dollars ($500.00). The Gross Sales Revenue shall be the gross dollar amount (before any deductions) received by Lessee (or PPC or the working interest owners of the gas) for the sale of the gas which is connected to the Byng System by Lessee, except for any gas which may be sold by Lessee on the behalf of Lessor. The Gross Sales Revenue shall be calculated as the value received FOB the custody transfer point between the Byng System and any other third party pipeline system (such as Noram pipeline) and shall not be reduced for any fees, costs or expenses, including but not limited to, marketing fees, incurred to deliver such gas to a third party market. The Gross Sales Revenue amount shall be calculated using methods that are reasonably acceptable to the Parties and that are in accordance with any applicable industry standards, and shall be evidenced by documentation reasonably acceptable to Lessor.
5.2	Each month, Lessee shall provide Lessor with a statement showing the total gas volume in Mcfs and MMBtus connected to the Byng System and the total volume in MMBtus and gross sales price per MMBtu received by Lessee (PPC or the working interest owners of the gas) for the sale of such gas to its market(s). Lessor (and/or its duly authorized representatives) shall have the right, at any reasonable time and from time to time, to audit the records of Lessee and its affiliates that are reasonably needed in order to calculate and/or confirm the amounts that are due and owing under this Agreement. Lessee agrees to cooperate in furnishing to Lessor applicable records, documents, and other data in connection with such audits.
5.3	Lessee agrees to pay the Lease Rental Fee for each month within thirty (30) days after the end of such month. If any such payment is not paid within fifteen (15) days of the due date, then the amount due shall bear interest from such due date until payment is received, calculated at an annual rate equivalent to the lesser of (i.) 16%; or (ii.) the maximum interest rate which may be lawfully charged under applicable law.

SECTION 6. GAS PROCESSING

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

SECTION 7. TERM

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

SECTION 8. INSPECTION, NO REPRESENTATIONS

8.1

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

8.2

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

SECTION 9. DAMAGES AND LINE CHANGES OR RELOCATIONS

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

SECTION 10. INDEMNIFICATION

10.1

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

10.2

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

SECTION 11. INSURANCE

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

a.	Worker's Compensation and Employer's Liability Insurance, as prescribed by applicable law, with such, insurance containing a waiver of subrogation against Lessor.
b.	Commercial General Liability Insurance, covering the property and any related facilities or equipment, with combined single limits for bodily injury and property damage of $1,000,000 per occurrence and in the aggregate. The insurance shall include contractual liability coverage specifically insuring the indemnity agreement of Lessee contained herein, and shall cover the entire property leased herein. The insurance also shall include the following endorsement: Additional Insured Designated Person or Organization (CG 20 26 11 85) naming Lessor as an additional insured with respect to liability arising out of Lessee's actions or activities under this Agreement.
c.	Automobile Liability Insurance covering all owned, non–owned, and hired vehicles with a combined single limit for bodily injury and property damage of $1,000,000 per accident. This insurance shall include contractual liability coverage specifically insuring the indemnity agreement of Lessee contained herein.

11.2

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

11.3

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

SECTION 12. COMPLIANCE WITH LAWS AND TAXES

12.1

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

12.2

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

SECTION 13. OPTION TO PARTICIPATE IN WELLS/PROSPECTS

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

SECTION 14. MISCELLANEOUS

14.1	Lessor shall have the right to enter upon the property of the Byng System to inspect such property or related equipment or to enforce or carry out any provision of this Agreement.
14.2	This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns. Lessee shall not assign this Agreement in whole or in part nor sublet all or any part of the Byng System nor permit the use of any part of the property or pipelines by any other person or entity without the prior written consent of Lessor.
14.3	All notices required under this Agreement shall be deemed made when made in writing and personally delivered, received by overnight mail, received by telecopy, or received by certified or registered mail, return receipt requested, to the following addresses:

To Lessee:
Pontotoc Gathering, L.L.C.
1345 E. 29th Street
Tulsa, OK 74114
Phone #: 918.742.5835
Fax #: 918.743.2645
Attention: Mr. Tim Jurek

To Lessor:
Enerfin Resources I Limited Partnership
Three Riverway Suite 1200
Houston, TX 77056
Phone #: 713.888.8600
Fax #: 713.888.8629
Attention: Contract Administration

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

14.4	The occurrence of one or more of the following events constitutes a default under this Agreement, with the non–defaulting party having in such situation the right to immediately terminate this Agreement upon written notice to the defaulting party, with termination to be effective as of the date specified in the notice: (a) Failure to observe or perform any covenant, agreement, condition or provision of this Agreement if such failure shall continue for thirty (30) days after written notice to the defaulting party of such failure, except that if, because of the nature of the default, such default cannot be cured within such thirty (30) day period, such period shall be extended provided that the defaulting party commences to cure such default within such thirty (30) day period and proceeds diligently thereafter to effectuate such cure; or (b) Either party has a petition in bankruptcy filed by or against it, has a receiver appointed for it, becomes insolvent, or makes a general assignment for the benefit of creditors. In the event of default by Lessee, Lessor shall have the right, in addition to its other rights under this Agreement, to immediately re–enter the property.
14.5	This Agreement shall be construed in accordance with the laws of the state of Oklahoma.
14.6	This Agreement contains the entire agreement of the parties with respect to the subject matter thereof, and supersedes all prior and contemporaneous agreements, whether written or oral, between the parties with respect to the lease of the property. This Agreement may not be modified except by an instrument signed by both parties.

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

PONTOTOC GATHERING, L.L.C.

By:                 /s/ Timothy A. Jurek       

Name:              Timothy A. Jurek          

Title:                    President                  

ENERFIN RESOURCES I LIMITED PARTNERSHIP
    By:     Enerfin I Corporation
                 Managing General Partner

By:                 /s/ Dave C. Cremer    

Name:              Dave C. Cremer       

Title:               Vice President          

EX-10.3 11 exhibit103.htm

Exhibit 10.3

INDEMNITY AGREEMENT

THIS INDEMNITY AGREEMENT (this "Agreement") is made and effective as of this ___ day of ________, 2001, by and between Ascent Energy Inc., a Delaware corporation (the "Company"), and ________________________ ("Indemnitee"). 

WITNESSETH: 

            WHEREAS, the Company seeks to attract and retain competent and experienced persons to serve as directors and desires to protect such individuals by providing comprehensive liability insurance and indemnification due to exposure to litigation costs and risks resulting from their service to the Company; 

            WHEREAS, the Board of Directors of the Company has concluded that to retain and attract talented and experienced individuals to serve as directors of the Company, and to encourage such individuals to take the business risks necessary for the success of the Company, it is necessary for the Company to contractually indemnify its directors and to assume for itself maximum liability for expenses and damages in connection with claims against its directors in connection with their service to the Company; 

            WHEREAS, the General Corporation Law of the State of Delaware (the "DGCL"), under which the Company is organized, empowers the Company to indemnify by agreement its directors and expressly provides that the indemnification provided in the DGCL is not exclusive; and 

            WHEREAS, the Company desires and has requested the Indemnitee to continue to serve as a director of the Company free from undue concern for claims for damages arising out of or related to such service to the Company. 

            NOW, THEREFORE, in consideration of the Indemnitee's agreement to continue to serve as a director of the Company, the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto stipulate and agree as follows: 

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

                        (a)     "agent" of the Company means any person who is or was a director of the Company or a subsidiary of the Company; or is or was serving at the request of, for the convenience of, or to represent the interest of the Company or a subsidiary of the Company as a director or officer of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise or an affiliate of the Company. The term "enterprise" includes any employee benefit plan of the Company, its subsidiaries or affiliates. 

                        (b)     "expenses" includes all direct and indirect costs of any type or nature whatsoever (including, without limitation, all attorneys' fees and related disbursements and other out–of–pocket costs) actually and reasonably incurred by the Indemnitee in connection with the investigation, defense or appeal of a proceeding or establishing or enforcing a right to indemnification or advancement of expenses under this Agreement, the Company's Certificate of Incorporation, Bylaws, the DGCL or otherwise. 

                        (c)     "proceeding" means any threatened, pending or completed action, suit or other proceeding, whether civil, criminal, administrative, arbitral, investigative or any other type whatsoever. 

                        (d)     "subsidiary" means any corporation or other business entity of which more than 50% of the outstanding voting securities is owned, directly or indirectly, by the Company, by the Company and one or more of its subsidiaries or by one or more of the Company's subsidiaries. 

            2.         Agreement to Serve. The Indemnitee agrees to continue to serve as a director and agent of the Company in the capacities Indemnitee currently serves or as he may hereafter agree to serve so long as he is duly appointed or elected and qualified in accordance with the applicable provisions of the Certificate of Incorporation or Bylaws of the Company, or until such time as he tenders his resignation in writing. 

            3.         Maintenance of Liability Insurance. 

                        (a)     The Company agrees that, as long as the Indemnitee shall continue to serve as a director of the Company and/or as an agent in any other capacity and thereafter for the period of five years following the termination of service, the Company shall maintain in full force and effect directors' and officers' liability insurance (the "D&O Insurance") in a minimum aggregate amount of $20 million for each policy year from established and reputable insurers on such terms as are approved from time to time by the Board of Directors. The Indemnitee shall be named as an insured in all D&O Insurance in such a manner as to provide the Indemnitee with the maximum rights and benefits available under the D&O Insurance. 

                        (b)    Notwithstanding anything in this Section 3 to the contrary, the Company shall have no obligation to maintain D&O Insurance if the Board of Directors determines in good faith that the premium costs for such insurance are disproportionate to the amount of coverage provided or the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit. 

            4.         Indemnification. To the fullest extent allowed by law, the Indemnitee shall be indemnified and held harmless by the Company against all expense incurred by Indemnitee in connection with any proceeding to which the Indemnitee is a party, participant or is threatened to be made a party or participant, based upon, arising from, relating to or by reason of the fact that the Indemnitee is, was, shall be or shall have been an agent. 

            5.         Mandatory Advancement of Expenses. The Company shall advance all expenses incurred by the Indemnitee in connection with the investigation, defense, settlement or appeal of any proceeding to which the Indemnitee is a party or is threatened to be made a party by reason of the fact that the Indemnitee is or was an agent or by reason of anything done or not done by him in any such capacity. The Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that the Indemnitee is not entitled to be indemnified by the Company under the provisions of this Agreement, the Certificate of Incorporation or Bylaws of the Company or the DGCL. The advances to be made hereunder shall be paid by the Company to the Indemnitee within 20 days following the delivery of a written request therefor by the Indemnitee to the Company. 

            6.         Notice and other Procedures. 

                        (a)     Promptly after receipt by the Indemnitee of notice of the commencement of or the threat of commencement of any proceeding, the Indemnitee shall, if the Indemnitee believes that indemnification with respect thereto may be sought from the Company under this Agreement, notify the Company of the commencement or threat of commencement thereof. 

                        (b)     If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 6(a), the Company has D&O Insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the D&O Insurance. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of the D&O Insurance. 

                        (c)     If the Company is obligated to advance the expenses for any proceeding, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by the Indemnitee (which approval shall not be unreasonably withheld), upon the delivery to the Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not be liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that: (i) the Indemnitee shall have the right to employ his own counsel in any such proceeding at the Indemnitee's expense; (ii) the Indemnitee shall have the right to employ his own counsel in connection with any such proceeding, at the expense of the Company, if such counsel serves in a review, observer, advice and counseling capacity and does not otherwise materially control or participate in the defense of such proceeding; and (iii) if (A) the employment of counsel by the Indemnitee has been previously authorized by the Company, (B) the Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and the Indemnitee in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of the Indemnitee's counsel shall be at the expense of the Company. 

            7.         Determination of Right to Indemnification. 

                        (a)     To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in Section 4 or in the defense of any claim, issue or matter described therein, the Indemnitee shall be entitled to indemnification from the Company and the Company shall indemnify the Indemnitee against expenses actually and reasonably incurred by him in connection with the investigation, defense or appeal of such proceeding. 

                        (b)     In the event that Section 7(a) is inapplicable, the Company shall also indemnify the Indemnitee unless, and only to the extent that, the Company shall prove by clear and convincing evidence to a forum listed in Subsection 7(c) that the Indemnitee's acts were committed in bad faith, or were the result of active and deliberate dishonesty, and were material to the cause of action so adjudicated and that the Indemnitee in fact personally gained a financial profit or other advantage to which he was not legally entitled. Neither the failure of the Company to have made a determination prior to the commencement of a proceeding that indemnification of the Indemnitee is proper under the circumstances because the Indemnitee has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Company that the Indemnitee has not met the applicable standard of conduct, shall be a defense to the action or create a presumption that the Indemnitee has not met the applicable standard of conduct. 

                        (c)     The Indemnitee shall be entitled to select the forum in which the validity of the Company's claim under Section 7(b) hereof that the Indemnitee is not entitled to indemnification will be heard from among the following: 

                                (i)     A quorum of the Board of Directors consisting of directors who are not parties to the proceeding for which indemnification is being sought or by a committee of such directors designated by a majority vote of such directors, even though less than a quorum; 

                                (ii)     The stockholders of the Company entitled to vote in the election of directors; provided that the common stock of the Company is not listed or traded on a national securities market or Nasdaq; 

                                (iii)     Legal counsel selected by the Indemnitee, and reasonably approved by the Board of Directors, which counsel shall make such determination in a written opinion; or 

                                (iv)     A panel of three arbitrators, one of whom is selected by the Company, another of whom is selected by the Indemnitee and the last of whom is selected by the first two arbitrators so selected. 

                        (d)     As soon as practicable, and in no event later than 30 days after written notice of the Indemnitee's choice of forum pursuant to Section 7(c), the Company shall, at its own expense, submit to the selected forum in such manner as the Indemnitee or the Indemnitee's counsel may reasonably request, its claim that the Indemnitee is not entitled to indemnification; and the Company shall act in the utmost good faith to assure the Indemnitee a complete opportunity to defend against such claim. 

                        (e)     After the final decision of the forum selected pursuant to Section 7(c) is rendered, the Indemnitee and Company shall each have the right to apply to the Court of Chancery of Delaware, the court in which that proceeding is or was pending or any other court of competent jurisdiction, for the purpose of appealing the decision of such forum; provided that such right is exercised within 60 days after the final decision of such forum is rendered. 

                        (f)     Notwithstanding any other provision in this Agreement to the contrary, the Company shall indemnify the Indemnitee against all expenses incurred by the Indemnitee in connection with any proceeding under this Section 7 involving the Indemnitee and against all expenses incurred by the Indemnitee in connection with any other proceeding between the Company and the Indemnitee involving the interpretation or enforcement of the rights of the Indemnitee under this Agreement unless a court of competent jurisdiction finds that each of the claims and/or defenses of the Indemnitee in any such proceeding was frivolous or made in bad faith. 

            8.         Exceptions. Notwithstanding any other provision of this Agreement, the Company shall not be obligated pursuant to the terms of this Agreement: 

                        (a)     To indemnify or advance expenses to the Indemnitee with respect to proceedings or claims initiated or brought voluntarily by the Indemnitee and not by way of defense, except with respect to proceedings specifically authorized by the Board of Directors or brought to establish or enforce a right to indemnification and/or advancement of expenses arising under this Agreement, the Certificate of Incorporation or Bylaws of the Company or any subsidiary or any statute or law or otherwise, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors finds it to be appropriate; 

                        (b)     To indemnify the Indemnitee hereunder for any amounts paid in settlement of a proceeding unless the Company consents in advance in writing to such settlement, which consent shall not be unreasonably withheld; or 

                        (c)     To indemnify the Indemnitee on account of any suit in which judgment is rendered against the Indemnitee for an accounting of profits made from the purchase or sale by the Indemnitee of securities of the Company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local statutory law. 

            9.         Successors; Binding Agreement. This Agreement shall be binding on, and shall inure to the benefit of and be enforceable by, each of the Indemnitee's personal or legal representatives, executives, administrators, successors, heirs, distributees, devisees and by each of the Company's successors and assigns. The Company shall require any successor or assignee (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by written agreement in form and substance reasonably satisfactory to the Company and to the Indemnitee, expressly to assume and agree to perform this Agreement in the same manner that the Company would be required to perform if no such succession or assignment had taken place. 

            10.         Credit for Insurance; Other Indemnities. Notwithstanding any other provision of this Agreement, the amount of indemnification payable by the Company with respect to any proceeding shall be subject to a credit for amounts actually paid to Indemnitee under or pursuant to (a) D&O Insurance and (b) provisions providing indemnification in the Certificate of Incorporation, Bylaws, resolutions, agreements or other instruments of the Company or any subsidiary. 

            11.         Deposit of Funds in Trust. If the Company voluntarily decides to dissolve or to file a petition for relief under any applicable bankruptcy, moratorium or similar laws, then not later than 10 days prior to such dissolution or filing, the Company shall deposit in trust for the sole and exclusive benefit of Indemnitee a cash amount equal to all amounts previously authorized to be paid to Indemnitee hereunder, such amounts to be used to discharge the Company's obligations to Indemnitee hereunder. Any amounts in such trust not required for such purpose shall be returned to the Company. This Section 11 shall not apply to the dissolution of the Company in connection with a transaction as to which Section 9 applies. 

            12.         Enforcement. 

                        (a)     The Company has entered into this Agreement and assumed the obligations imposed on the Company or hereby in order to induce the Indemnitee to continue to act as an agent of the Company and acknowledges that the Indemnitee is relying upon this Agreement in continuing in such capacity. 

                        (b)     All expenses incurred by the Indemnitee in connection with the preparation and submission of the Indemnitee's request for indemnification hereunder shall be borne by the Company. If the Indemnitee has requested payment of any amount under this Agreement and has not received payment thereof within 20 days of such request, the Indemnitee may bring any action to enforce rights or collect moneys due under this Agreement, and, if the Indemnitee is successful in such action, the Company shall reimburse the Indemnitee for all of the Indemnitee's fees and expenses in bringing and pursuing such action. If it is determined that the Indemnitee is entitled to indemnification for part (but not all) of the indemnification so requested, expenses incurred in seeking enforcement of such partial indemnification shall be reasonably prorated among the claims, issues or matters for which the Indemnitee is entitled to indemnification for claims, issues or matter for which the Indemnitee is not so entitled. The Indemnitee shall be entitled to the advancement of such amounts to the full extent contemplated by Section 5 hereof in connection with such proceeding. 

                        (c)     The Company shall be precluded from asserting in any judicial proceeding commenced under this Agreement that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court that the Company is bound by all the provisions of this Agreement. 

            13.         Savings Clause. If any provision of this Agreement is determined by a court having jurisdiction over the matter to violate or conflict with applicable law, the court shall be empowered to modify or reform such provision so that, as modified or reformed, such provision provides the maximum indemnification permitted by law and such provision, as so modified or reformed, and the balance of this Agreement, shall be applied in accordance with their terms. Without limiting the generality of the foregoing, if any portion of this Agreement shall be invalidated on any ground, the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated and to the full extent permitted by law with respect to that portion that has been invalidated. 

            14.         Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some claims, issues or matters related to a proceeding, but not as to other claims, issues or matters, or for some or a portion of the expenses in the investigation, defense, appeal or settlement of any proceeding, but not for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such claims, issues or matters or expenses to which Indemnitee is entitled. 

            15.         Non–Exclusivity. 

                        (a)     The right to indemnification provided by or granted pursuant to this Agreement shall not be deemed exclusive of any other rights to which Indemnitee is or may become entitled under any statute, provision of the Company's Certificate of Incorporation, Bylaws, agreement, resolution or otherwise. 

                        (b)     It is the intent of the Company by this Agreement to indemnify and hold harmless Indemnitee to the fullest extent permitted by law, so that if applicable law would permit the Company to provide broader indemnification rights than are currently permitted, the Company shall indemnify and hold harmless Indemnitee to the fullest extent permitted by applicable law notwithstanding that the other terms of this Agreement would provide for lesser indemnification. 

            16.         Confidentiality. The Company and Indemnitee shall keep confidential to the extent permitted by law and their fiduciary obligations all information and determinations provided pursuant to or arising out of the operations of this Agreement and the Company and Indemnitee shall instruct their agents and employees to do likewise. 

            17.         Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute an original but all of which taken together shall be deemed to constitute a single instrument. 

            18.         Applicable Law. This Agreement shall be governed by and construed in accordance with the substantive laws of the State of Delaware. 

            19.         Amendment. No amendment, modification, termination or cancellation of this Agreement shall be effective unless made in writing signed by the Company and Indemnitee. Notwithstanding any amendment, modification, termination or cancellation of this Agreement or any portion hereof, Indemnitee shall be entitled to indemnification in accordance with the provisions hereof with respect to any acts or omissions of Indemnitee which occur prior to such amendment, modification, termination or cancellation. 

            20.         Gender. All pronouns and variations thereof used in this Agreement shall be deemed to refer to the masculine, feminine or neuter gender, singular or plural, as the identity of the person, persons, entity or entities referred to may require. 

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

                                                                                  ASCENT ENERGY INC.

                                                                                  By: ____________________________________
                                                                                                                  Jeffrey Clark
                                                                                                                    President

                                                                                  INDEMNITEE: 

                                                                                  ____________________________________

EX-10.4 12 exhibit104.htm

Exhibit 10.4

REGISTRATION RIGHTS AGREEMENT

            This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered into as of ____________, 2001, by and among Ascent Energy Inc., a Delaware corporation ("Ascent"), and those Persons whose names appear on the signature pages hereof.

            This Agreement is made in connection with the offering by Ascent of rights to subscribe for 
units consisting of one share of 8% Series A Redeemable Preferred Stock and one warrant to purchase 
_____ shares of common stock of Ascent (the "Rights Offering").

            The parties hereby agree as follows:    

            Section 1.    Definitions. As used in this Agreement, the following terms shall have the following meanings:

            "Agreement" shall have the meaning assigned to such term in the recitals hereto, as constituted on the date hereof and as amended from time to time.

            "Commission" means the Securities and Exchange Commission, or any other federal agency then administering the Securities Act.

            "Common Stock" means the common stock of Ascent, par value $0.001 per share, as constituted on the date hereof, and any shares into which such Common Stock shall have been changed or any shares resulting from any reclassification of such Common Stock.

            "Controlling Person" shall have the meaning given to such term in Section 7(a).

            "Demand Registration" shall have the meaning given to such term in Section 3(a).

            "Exchange Act" means the Securities Exchange Act of 1934, as amended, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect from time to time.

            "Holder" means each Person listed on the signature pages attached hereto or otherwise party to this Agreement who as of such date owns outstanding shares of Registrable Securities.

            "Indemnified Party" shall have the meaning given to such term in Section 7(c).

            "Indemnifying Party" shall have the meaning given to such term in Section 7(c).

            "Losses" means all losses, claims, damages or liabilities (other than consequential damages or incidental lost profits) and all costs and expenses related thereto, including, without limitation, the reasonable fees and disbursements of counsel.

            "Maximum Contribution Amount" shall have the meaning given to such term in Section 7(d).

            "NASD" means the National Association of Securities Dealers, Inc.

            "Person" shall mean any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust, unincorporated organization or government or agency or political subdivision thereof.

            "Piggyback Registration" shall have the meaning given to such term in a Section 4(a).

            "Proceeding" means any claim, suit, action or proceeding, including any governmental investigation or inquiry.

            "Qualified Holders" means any Holder or Holders holding at any time not less than 51% of all Registrable Securities.

            "Registrable Securities" means (a) the Common Stock held by any Holder on the date hereof or any Common Stock issuable pursuant to the conversion of the Series A Preferred Stock or upon exercise of the Warrants, (b) any shares of Common Stock acquired by any Holder after the date hereof or issuable upon the conversion or exercise of any other security issued by Ascent to any Holder and (c) any additional shares of Common Stock or other securities issued or distributed by Ascent after the date hereof to any Holder with respect to Common Stock, Series A Preferred Stock or Warrants by means of exchange, reclassification, dividend, distribution, split–up, combination, subdivision, recapitalization, merger, spin–off, reorganization or otherwise. As to any particular Registrable Securities, once issued such securities shall cease to be Registrable Securities when (i) a registration statement with respect to the sale of such securities has become effective under the Securities Act and such securities have been disposed of in accordance with such registration statement, (ii) they shall have been sold pursuant to Rule 144 under the Securities Act or (iii) they shall cease to be outstanding.

            "Rights Offering " shall have the meaning assigned to such term in the recitals hereto.

            "Securities Act" means the Securities Act of 1933, as amended, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect from time to time.

            "Series A Preferred Stock" means the 8% Series A Redeemable Preferred Stock of Ascent issued pursuant to the Rights Offering, as constituted on the date hereof, any shares into which such Series A Preferred Stock shall have been changed or any shares resulting from any reclassification of such Series A Preferred Stock.

            "Special Counsel" means counsel chosen by the holders of a majority of the Registrable Securities being sold pursuant to a registration covered by this Agreement.

            "Warrants" means the warrants to purchase Common Stock issued pursuant to the Rights Offering, a warrant issued in respect thereof or any Common Stock acquired upon the exercise of or in respect of any such warrant.

            Section 2.    Acknowledgement of Rights. Ascent will, upon request of any Holder, acknowledge in writing its obligations in respect of the rights to which such Holder shall be entitled under this Agreement; provided that the failure of such Holder to make any such request shall not affect the continuing obligations of Ascent to such Holder in respect of such rights.

            Section 3.    Demand Registration.

            (a)    At any time after [December 31, 2001 or 185 days after the date that the Common Stock is registered under Sections 12(b) or 12(g) of the Exchange Act], the Qualifying Holders may at any time and from time to time make a written request for registration under the Securities Act of an amount of Registrable Securities equal to not less than 5% of the then outstanding Common Stock (a "Demand Registration"); provided that Ascent shall not be obligated to affect more than two Demand Registrations in any 12 month period or more than an aggregate of four Demand Registrations pursuant to this Section 3(a). A registration will not count as a Demand Registration until the registration statement filed pursuant to such Demand Registration has been declared effective by the Commission and remains effective for the period specified in Section 5(b).

            (b)    If the Qualified Holders so elect, the offering of such Registrable Securities pursuant to a Demand Registration shall be in the form of an underwritten offering. The Qualified Holders shall select the managing underwriters and any additional investment bankers and managers to be used in connection with the offering; provided that such managing underwriters must be reasonably satisfactory to Ascent.

            (c)    Neither Ascent nor any of its security holders (other than the Holders in such capacity) shall be entitled to include any of Ascent's securities in a registration statement initiated as a Demand Registration under this Section 3(a) without the consent of the Qualified Holders.

             Section 4.    Piggyback Registration.

            (a)    If Ascent proposes to register Common Stock under the Securities Act (other than on registration statements with respect to corporate reorganizations or other transactions under Rule 145 under the Securities Act or registration statements on Form S–8), (i) for its own account or (ii) for the account of other holders of Common Stock (other than a Demand Registration pursuant to Section 3(a)), then Ascent shall give written notice of such proposed filing to the Holders as soon as practicable (but in no event later than 20 days before the filing date) and such notice shall offer the Holders the opportunity to register such number of shares of Registrable Securities as the Holders may request within 20 days after receipt by the holders of Ascent's notice on the same terms and conditions as Ascent or such holders of Common Stock (a "Piggyback Registration") The Holders will be permitted to withdraw all or any part of their Registrable Securities from a Piggyback Registration any time prior to the date the registration statement filed pursuant to such Piggyback Registration becomes effective with the Commission.

            (b)    Notwithstanding anything contained herein, if the Piggyback Registration is an underwritten offering and the lead managing underwriter of such offering delivers a written opinion to Ascent that the size of the offering Ascent, the Holders and any other Persons who securities are proposed to be included in such offering propose to make would materially and adversely affect the offering or offering price, Ascent will include in such Piggyback Registration all of the Common Stock it proposes to offer and the Common Stock proposed to be sold by the Holders and any other Persons in the following order of priority: (i) first, all of the Registrable Securities requested by the Holders, on a pro rata basis based on the amount of securities sought to be so registered and (ii) second, securities proposed to be registered by any other Persons.

            Section 5.    Registration Procedures. If and whenever Ascent is required by the provisions of this Agreement to use commercially reasonable efforts to effect the registration of any of the Registrable Securities under the Securities Act, Ascent will (except as otherwise provided in this Agreement):

            (a)    (i) cooperate with any underwriters for, and the selling Holders, and, in the event of any underwritten public offering, will enter into usual and customary underwriting agreements with respect thereto and take all such other reasonable actions as are necessary or advisable to permit, expedite and facilitate the disposition of such Registrable Securities in the manner contemplated by the related registration statement, and in each case to the same extent as if all the securities then being offered were for the account of Ascent, and (ii) provide to any selling Holder, any underwriter participating in any distribution thereof pursuant to a registration statement, and any attorney, accountant or other agent retained by any selling Holder or any underwriter reasonable access to appropriate Ascent officers and employees to answer questions and to supply information reasonably requested by such selling Holder, or by any such underwriter, attorney, accountant or agent in connection with such registration statement;

            (b)    prepare and file with the Commission a registration statement with respect to such securities and use commercially reasonable efforts to cause such registration statement to become and remain effective until the earlier to occur of the passage of 90 days from the date of effectiveness and the sale of all of the Registrable Securities registered under such registration statement; and prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective for the time period required pursuant to this Agreement and to comply with the provisions of the Securities Act with respect to the sale or other disposition of all securities covered by such registration statement whenever the selling Holders shall desire to sell or otherwise dispose of the same;

            (c)    furnish to such selling Holders, who so request, (i) upon Ascent's receipt, a copy of the order of the Commission declaring such registration statement and any post–effective amendment thereto effective, (ii) such reasonable number of copies of such registration statement and of each amendment and supplement thereto (in each case including any documents incorporated therein by reference and all exhibits), (iii) such reasonable number of copies of the prospectus included in such registration statement (including each preliminary prospectus), (iv) such reasonable number of copies of the final prospectus as filed by Ascent pursuant to Rule 424(b) under the Securities Act, in conformity with the requirements of the Securities Act, and (v) such other documents, as any such Person may reasonably request. Ascent hereby consents to the use of the prospectus by each of the selling Holders and the underwriters or agents, if any, and dealers (if any), in connection with the offering and sale of the Registrable Securities pursuant to, such prospectus and any amendment thereto;

            (d)    use commercially reasonable efforts to (i) register or qualify the securities covered by such registration statement under such other securities or blue sky laws of such jurisdictions as each selling Holder shall reasonably request, (ii) keep such registrations or qualifications in effect and comply with such laws so as to permit the continuance of offers, sales and dealings therein in such jurisdictions for so long as may be necessary to enable such Holder, or any such agent or underwriter to complete its distribution of the securities pursuant to such registration statement but in no event longer than two years and (iii) cooperate with such Holders and each underwriter, if any, in connection with any filings required to be made with the NASD and do any and all other acts and things which may be reasonably necessary or advisable to enable such Holder to consummate the disposition in each such jurisdiction of such Registrable Securities owned by such Holder; provided, however, that Ascent shall not be required to (A) qualify to do business as a foreign corporation or as a dealer in securities in any jurisdiction where it would not otherwise be required to qualify but for this Section 5(d) or (B) file any general consent to service of process;

            (e)    notify each selling Holder and counsel for such selling Holders identified to Ascent and, if requested by such Persons, confirm such advice in writing, (i) when the registration statement has become effective and when any post–effective amendment thereto has been filed and becomes effective, (ii) of any request by the Commission or any state securities authority for amendments and supplements to the registration statement and prospectus or for additional information after the registration statement has become effective, (iii) of the issuance by the Commission or any state securities authority of any stop order suspending the effectiveness of the registration statement or the initiation of any Proceedings for that purpose, (iv) if Ascent receives any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation of any Proceeding for such purpose, (v) of the happening of any event during the period a registration statement is effective which makes any statement made in such registration statement or the related prospectus untrue in any material respect or which requires the making of any changes in such registration statement or any document incorporated by reference therein in order to make the statements therein not misleading or which requires the making of any changes in the prospectus or documents incorporated by reference therein in order to make the statements therein, in light of the circumstances under which they were made, not misleading and (vi) of any determination by Ascent that a post–effective amendment to the registration statement would be appropriate;

            (f)    use its best efforts to prevent the issuance of any order suspending the effectiveness of a registration statement or of any order preventing or suspending the use of a prospectus or suspending the qualification (or exemption from qualification) of any of the securities for sale in any jurisdiction, and, if any such order is issued, to use commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of a registration statement at the earliest possible time and provide prompt notice to each selling Holder of the withdrawal of any such order;

            (g)    comply with all applicable rules and regulations of the Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months, beginning with the first fiscal quarter beginning after the effective date of the registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act);

            (h)    list such securities on any securities exchange or market on which any stock of Ascent is then listed, if the listing of such securities is then permitted under the rules of such exchange;

            (i)     if requested by the managing underwriters, if any, or the Holders of a majority of the Registrable Securities being registered, (i) promptly incorporate in a prospectus supplement or post–effective amendment such information as the managing underwriters, if any, and such Holders reasonably agree should be included therein to the extent required by applicable law and (ii) make all required filings of such prospectus supplement or such post–effective amendment as soon as practicable after Ascent has received notification of the matters to be incorporated in such prospectus supplement or post–effective amendment; provided, however, that Ascent will not be required to take any actions under this Section 5(i) that are not, in the opinion of counsel for Ascent, required by applicable law; and

            (j)     enter into such agreements (including, in the event of an underwritten offering, an underwriting agreement in form, scope and substance as is customary in underwritten offerings) and take all such other commercially reasonable actions in connection therewith (including those reasonably required by the Holders of a majority of the Registrable Securities being sold or, in the event of an underwritten offering those requested by the managing underwriters) in order to permit the disposition of such Registrable Securities and in such connection, if the registration is an underwritten registration, (i) make such representations and warranties to the Holders of such Registrable Securities and underwriters, if any, with respect to the business of Ascent and its subsidiaries, the registration statement, the prospectus and documents incorporated by reference or deemed incorporated by reference in the registration statement, if any, in each case, in form, substance and scope if and when requested; (ii) obtain opinions of counsel to Ascent and updates thereof (which counsel and opinions (in form, scope and substance) shall be reasonably satisfactory to the managing underwriters, if any, and the Holders of a majority of the Registrable Securities being sold) addressed to such selling Holders of Registrable Securities and each of the, underwriters, if any, covering the matters customarily covered in opinions requested in underwritten offerings and such other matters as may be reasonably requested by such Holders and underwriters, including without limitation the matters referred to in clause (i) above; (iii) use its reasonable commercial efforts to obtain "comfort" letters and updates thereof from the independent certified public accountants of Ascent (and, if necessary, any other certified public accountants of any subsidiary of Ascent or of any business acquired by Ascent for which financial statements and financial data is, or is required to be, included in the Registration Statement), addressed to each of the underwriters, if any, such letters to be in customary form and covering matters the type customarily covered in "comfort" letters in connection with underwritten offerings; and (iv) deliver such documents and certificates as may reasonably be requested by the Holders of a majority of the Registrable Securities being sold, the Special Counsel and the managing underwriters, if any, to evidence the continued validity of the representations and warranties of Ascent and its subsidiaries made pursuant to clause (i) above and to evidence compliance with any customary conditions contained in the underwriting, agreement or similar agreement entered into by Ascent. The foregoing actions will be taken in connection with each closing under such underwriting or similar agreement as and to the extent required thereunder.

            From time to time after a transfer of Registrable Securities pursuant to a registration statement Ascent will file all reports required to be filed by it under the Securities Act and the Exchange Act. Ascent may require each such Holder to agree to keep confidential any non–public information relating to Ascent received by such Holder and not disclose such information (other than to an Affiliate or prospective purchaser who agrees to respect the confidentiality provisions of this Section 5) until such information has been made generally available to the public unless the release of such information is required by law or necessary to respond to inquiries of regulatory authorities.

            Section 6.    Registration Expenses; Hold–Backs.

            (a)    In connection with any Demand Registration or any Piggyback Registration, Ascent shall pay the following expenses incurred in connection with such registration: (i) filing fees with the Commission; (ii) fees and expenses of compliance with securities or blue sky laws (including reasonable fees and disbursements of counsel in connection with blue sky qualifications of the Registrable Securities); (iii) printing expenses; (iv) fees and expenses incurred in connection with the listing of the Registrable Securities; (v) fees and expenses of counsel and independent certified public accountants for Ascent and (vi) the reasonable fees and expenses of any additional experts retained by Ascent in connection with such registration. In connection with the preparation and filing of a Registration Statement pursuant to Section 3(a), Ascent will also pay the reasonable fees and expenses of a single legal counsel chosen by the Qualified Holders. The Holders shall pay any underwriting fees, discounts or commissions attributable to the sale of Registrable Securities and any other expenses of the Holders.

            (b)    No person may participate in any underwritten registered offering contemplated hereunder unless such Person (i) agrees to sell its securities on the basis provided in any underwriting agreements approved by the Persons entitled hereunder to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements and this Agreement.

            (c)    The Holders agree not to effect any public sale (including a sale pursuant to Rule 144 of the Securities Act) of any Registrable Securities, or any securities convertible into or exchangeable or exercisable for such securities, during the 14 days prior to, and during the 90–day (180 days in the case of an initial public offering of Common Stock) period beginning on, the effective date of any underwritten Demand Registration or any underwritten Piggyback Registration (other than the Registrable Securities to be sold pursuant to such registration statement).

            Section 7.    Indemnification.

            (a)    In the event of any registration of any of its securities under the Securities Act pursuant to this Agreement, to the extent permitted by law, Ascent shall indemnify and hold harmless the Holders, the Holders' directors, officers, partners, employees, representatives and agents, and each other person, if any, who controls any Holder within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act (a "Controlling Person"), to the fullest extent possible against any Losses, as incurred, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue or alleged untrue statement of a material fact contained in any registration statement, prospectus or form of prospectus, or in any amendment or supplement thereto, or in any preliminary prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except insofar as such Losses are based upon information relating to such Holder and furnished in writing to Ascent by such Holder expressly for use therein; provided, however, that Ascent shall not be liable to any Indemnified Party to the extent that any such Losses arise solely out of an untrue statement or alleged untrue statement or omission or alleged omission made in any preliminary prospectus if (i) such Indemnified Party or related Holder failed to send or deliver a copy of the prospectus with or prior to the delivery of written confirmation of the sale by such Indemnified Party or the related Holder to the Person asserting the claim from which such Losses arise; (ii) the prospectus would have corrected such untrue statement or alleged untrue statement or omission or alleged omission; and (iii) Ascent has complied with its obligations under Section 5(e). Ascent shall also, jointly and severally, indemnify underwriters, selling brokers, dealer managers and similar securities industry professionals participating in the distribution and their Controlling Persons to the same extent as provided above with respect to the indemnification of the Holders.

            (b)    In connection with any registration statement, prospectus or form of prospectus, any amendment or supplement thereto, or any preliminary prospectus in which a Holder is participating, such Holder shall furnish to Ascent in writing such information as Ascent reasonably requests for use in connection with any registration statement, prospectus or form of prospectus, any amendment or supplement thereto, or any preliminary prospectus and shall, without limitation as to time, indemnify and hold harmless Ascent, its Controlling Persons, and the officers, directors, partners, employees, representatives and agents of such Controlling Persons, to the fullest extent lawful, from and against all Losses arising out of or based upon any untrue or alleged untrue statement of a material fact contained in any registration statement, prospectus or form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading to the extent, but only to the extent, that such untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact is contained in any information so furnished in writing by such Holder to Ascent expressly for use therein. In no event shall the liability of any selling Holder be greater in amount than the dollar amount of the proceeds (net of payment of all expenses) received by such Holder upon the sale of the Registrable Securities giving rise to such indemnification obligation.

            (c)    If any Proceeding shall be brought or asserted against any Person entitled to indemnity hereunder (an "Indemnified Party"), such Indemnified Party shall promptly notify the party or parties from which such indemnity is sought (individually, an "Indemnifying Party" and, collectively, the "Indemnifying Parties") in writing; provided, that the failure to so notify the Indemnifying Parties shall not relieve the Indemnifying Parties from any obligation or liability except to the extent that it shall be finally determined by a court of competent jurisdiction (which determination is not subject to appeal) that the Indemnifying Parties have been prejudiced materially by such failure. The Indemnifying Party shall have the right, exercisable by giving written notice to an Indemnified Party, within twenty days after receipt of written notice from such Indemnified Party of such Proceeding, to assume, at its expense, the defense of any such Proceeding; provided, that an Indemnified Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but, subject to Section 6, the fees and expenses of such counsel shall be at the expense of such Indemnified Party unless: (1) the Indemnifying Party has agreed to pay such fees and expenses; or (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding or shall have failed to employ counsel reasonably satisfactory to such Indemnified Party; or (3) the named parties to any such Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying Party or any of its affiliates or Controlling Persons, and such Indemnified Party shall have been advised by counsel that there may be one or more defenses available to such Indemnified Party that are in addition to, or in conflict with, those defenses available to the Indemnifying Party or such affiliate or Controlling Person (in which case, if such Indemnified Party notifies the Indemnifying Parties in writing that it elects to employ separate counsel at the expense of the Indemnifying Parties, the Indemnifying Parties shall not have the right to assume the defense thereof and the reasonable fees and expenses of such counsel shall be at the expense of the Indemnifying Party; it being understood, however, that, the Indemnifying Party shall not, in connection with any one such Proceeding or separate but substantially similar or related Proceedings in the same jurisdiction, arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (together with appropriate local counsel) at any time for such Indemnified Party).

            No Indemnifying Party shall be liable for any settlement of any such Proceeding effected without its written consent, but if settled with its written consent, or if there be a final judgment for the plaintiff in any such Proceeding, each Indemnifying Party jointly and severally agrees, subject to the exceptions and limitations set forth above, to indemnify and hold harmless each Indemnified Party from and against any and all Losses by reason of such settlement or judgment. The Indemnifying Party shall not consent to the entry of any judgment against an Indemnified Party or enter into any settlement that imposes any obligation on any Indemnified Party that does not include as a term thereof the giving by the claimant or plaintiff to each Indemnified Party of a release, in form and substance reasonably satisfactory to the Indemnified Party, from all liability in respect of such Proceeding for which such Indemnified Party would be entitled to indemnification hereunder (regardless of whether any Indemnified Party is a party thereto).

            (d)    If the indemnification provided for in this Section 7 is unavailable to an Indemnified Party or is insufficient to hold such Indemnified Party harmless for any Losses in respect of which this Section 7 would otherwise apply by its terms (other than by reason of exceptions provided in this Section 7), then each applicable Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall have a joint and several obligation to contribute to the amount paid or payable by such Indemnified Party as a result of such Losses, in such proportion as is appropriate to reflect the relative fault of each Indemnifying Party, on the one hand, and such Indemnified Party, on the other hand, in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of each Indemnifying Party, on the one hand, and Indemnified Party, on the other hand, shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such Indemnifying Party or Indemnified Party, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent any such statement or omission. The amount paid or payable by an Indemnified Party as a result of any Losses shall be deemed to include any legal or other fees or expenses incurred by such party in connection with any Proceeding, to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in Section 7(a) or 7(b) was available to such party.

            The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 7, an Indemnifying Party that is a selling Holder shall not be required to contribute, in the aggregate, any amount in excess of such Holder's Maximum Contribution Amount. A selling Holder's "Maximum Contribution Amount" shall equal the excess of (i) the aggregate proceeds received by such Holder pursuant to the sale of such Registrable Securities over (ii) the aggregate amount of damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

            The indemnity and contribution agreements contained in this Section 7 are in addition to any liability that the Indemnifying Parties may have to the Indemnified Parties.

            Section 8.    Rule 144. Ascent covenants that it will file any reports required to be filed by it under the Securities Act and the Exchange Act and that it will take such further action as any Holder may request to the extent required from time to time to enable the Holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 under the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission. Upon the request of a Holder, Ascent will deliver to the Holder a written statement as to whether it has complied with such reporting requirements.

            Section 9.    Assignment of Registration Rights. A Holder may assign its rights hereunder to a transferee or assignee at any time such Holder transfers or assigns Registrable Securities representing not less than 0.5% of all Registrable Securities subject to this Agreement on the date hereof to such transferee or assignee; provided, that (a) Ascent is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned; (b) such transferee or assignee agrees in writing to be bound by and subject to the terms and conditions of this Agreement by executing a counterpart signature page hereto; (c) such assignment of Registrable Securities is made in compliance with the Securities Act; and (d) such assignment shall be effective only if immediately following such transfer the further disposition of such securities by the transferee or assignee is restricted under the Securities Act. This Agreement may not be assigned by Ascent without the prior written consent of the Qualified Holders.

            Section 10.    Miscellaneous.

            (a)    Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand–delivery, certified first–class mail, return receipt requested, next–day air courier or facsimile:

                    (i)         if to a Holder, at the address of such Holder set forth on Ascent's stock records. 

                    (ii)        if to Ascent, at: 

                                Ascent Energy, Inc.
                                650 Poydras Street, Suite 2200
                                New Orleans, LA 70130
                                Facsimile Number: (504) 522–1796
                                Attention: President

and thereafter at such other address, notice of which is given in accordance with the provisions of this Section 9(a). All such notices and communications shall be deemed to have been duly given: when delivered by hand, if personally delivered; five days after being deposited in the mail, postage prepaid, if mailed; one day after being timely delivered to a next–day air courier; and when receipt is acknowledged by the addressee, if sent by facsimile.

            (b)    Amendment and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless Ascent has obtained the written consent of Holders of at least a majority of the then outstanding aggregate principal amount of Registrable Securities; provided, that Section 7 shall not be amended, modified or supplemented, and waivers or consents to departures from this proviso may not be given, unless Ascent has obtained the written consent of each Holder affected thereby. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders whose securities are being sold pursuant to a registration statement and that does not directly or indirectly affect the rights of other Holders may be given by Holders of at least a majority in aggregate principal amount of the Registrable Securities being sold by such Holders pursuant to such registration statement; provided that the provisions of this sentence may not be amended, modified or supplemented except in accordance with the provisions of the immediately preceding sentence.

            (c)    Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by facsimile transmission shall be effective as delivery of a manually executed counterpart of this Agreement.

            (d)    Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York without regard to rules of conflicts of laws.

            (e)    Filing. A copy of this Agreement and of all amendments hereto shall be filed at the principal office of Ascent.

            (f)    Headings and Internal References. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. References in this Agreement to "clauses" and "Sections" shall be understood to refer to clauses and sections of this Agreement unless otherwise specified.

            (g)    Remedies. In the event of a breach by Ascent of any of its obligations under this Agreement, each Holder, in addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. Ascent agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of any of the provisions of this Agreement and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall waive the defense that a remedy at law would be adequate.

            (h)    No Inconsistent Agreements. Ascent has not entered into, as of the date hereof, and shall not enter into, after the date of this Agreement, any agreement with respect to any of its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof.

            (i)    Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties.

            (j)    Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement, and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein, with respect to the registration rights granted by Ascent in respect of the Registrable Securities. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

            (k)    Attorneys' Fees. In any Proceeding brought to enforce any provision of this Agreement, or where any provision hereof is validly asserted as a defense, the prevailing party, as determined by the courts, shall be entitled to recover reasonable attorneys' fees in addition to its costs and expenses and any other available remedy.

            (l)    Third Party Beneficiary. Ascent hereby expressly agrees and acknowledges that the Holders are intended to be express third party beneficiaries of this Agreement and that each Holder shall be entitled to exercise any and all rights and remedies afforded to them under this Agreement and the laws of the relevant jurisdiction applicable to third party beneficiaries.

[signature pages follow]

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

                                                                                ASCENT ENERGY INC., a Delaware corporation


                                                                                 By:                                                                 
                                                                                          Jeffrey Clarke
                                                                                          President

                                                                                 HOLDERS:

                                                                                 [To Come]

ASCENT ENERGY INC.
REGISTRATION RIGHTS AGREEMENT

            This signature page is for the Registration Rights Agreement dated as of __________, 2001 (the "Agreement"), by and among Ascent and the Holders, and by execution below the undersigned agrees that it shall be attached as a signature page to such Agreement.

By:                                                                                      
        Name:                                                                        
        Title:                                                                            
                Tax I.D. No.:                                                      
                Address:                                                             
                                                                                            
                                                                                            
                Attention:                                                             
                Fax Number:                                                        
                Phone Number:                                                   

EX-23.1 13 ex231s4.htm

EXHIBIT 23.1

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our reports included in this registration statement and to all references to our Firm included in this registration statement.

         /s/ Arthur Andersen LLP
Arthur Andersen LLP

March 22, 2001
New Orleans, Louisiana

EX-23.2 14 exhibit232.htm

EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

We hereby consent to the incorporation by reference of our report dated May 12, 2000 relating to the financial statements of Pontotoc Production, Inc. ("Pontotoc") as of March 31, 1999 and 2000, and for the two years then ended, and to all references to our firm included in this registration statement on Form S–4 filed by Ascent Energy Inc.

GRANT THORNTON LLP

Oklahoma City, Oklahoma
March 23, 2001

EX-23.4 15 exhibit234.htm

EXHIBIT 23.4

CONSENT OF PERSON ABOUT TO BECOME A DIRECTOR

         In accordance with Rule 438 promulgated under the Securities Act of 1933, as amended, the undersigned hereby consents to his being named as a person about to become a director of Ascent Energy Inc. in this registration statement on form S–4 filed by Ascent Energy Inc.

                                                                                                                                  /s/ James Robson, Jr.                 
                                                                                                                            James "Robby" Robson, Jr.

Date: March 14, 2001

EX-23.5 16 exhibit235.htm

EXHIBIT 23.5

CONSENT OF PERSON ABOUT TO BECOME A DIRECTOR

            In accordance with Rule 438 promulgated under the Securities Act of 1933, as amended, the undersigned hereby consents to his being named as a person about to become a director of Ascent Energy Inc. in this registration statement on form S–4 filed by Ascent Energy Inc.

                                                                                                                               /s/ Jerry W. Box                              
                                                                                                                                    Jerry W. Box

Date: March 13, 2001

EX-23.6 17 exhibit236.htm

EXHIBIT 23.6

CONSENT OF NETHERLAND SEWELL & ASSOCIATES, INC.

                    As independent oil and gas consultants, Netherland Sewell & Associates, Inc., hereby consents to the use of our reserve report for Forman Petroleum Corporation dated as of December 31, 2000 and to all references to our firm included in or made a part of  this registration statement on Form S–4 filed by Ascent Energy Inc.

                                                                                                              NETHERLAND SEWELL & ASSOCIATES, INC.

                                                                                                              By:            /s/ Danny D. Simmons                            
                                                                                                                       Danny D. Simmons
                                                                                                                       Senior Vice President

March 16, 2001
Houston, Texas

EX-23.7 18 exhibit237.htm

EXHIBIT 23.7

CONSENT OF FLETCHER LEWIS ENGINEERING, INC.

            As independent oil and gas consultants, Fletcher Lewis Engineering, Inc., hereby consents to the use of our reserve report for Pontotoc Production, Inc. dated as of March 31, 2000 and to all references to our firm included in or made a part of this registration statement on Form S–4 filed by Ascent Energy Inc.

                                                                FLETCHER LEWIS ENGINEERING, INC.

                                                                                                  By:                                 /s/ Fletcher Lewis                     

                                                                                                  Name:                            Fletcher Lewis                           

                                                                                                  Title:                              President                                    

March 14,  2001

EX-23.8 19 exhibit238.htm

EXHIBIT 23.8

CONSENT OF C. K. COOPER & COMPANY, INC.

         We hereby consent to the inclusion and use of our fairness opinion letter, dated January 18, 2001, to the Board of Directors of Pontotoc Production, Inc. ("Pontotoc") with forms part of the registration statement on Form S–4 of Ascent Energy Inc. ("Ascent") relating to the proposed business combination involving Pontotoc, Ascent and Pontotoc Acquisition Corp., and the disclosures relating to such fairness opinion.

                In giving such consent, we do not represent that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended (the "Securities Act"), or the rules or regulations of the Securities and Exchange Commission thereunder, nor do we represent that we are experts with respect to any part of such registration statement within the meaning of the term "experts" as used in the Securities Act or the rules and regulations of the Securities and Exchange Commission thereunder.

     /s/ Annagene E. Montano                             
C. K. COOPER & COMPANY, INC.

Irvine, California
March 14, 2001

EX-99 20 exhibit991.htm

Exhibit 99.1

LETTER OF TRANSMITTAL

To Exchange Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.
pursuant to the Prospectus dated ___________, 2001

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK TIME ON _________, 2001
UNLESS THE OFFER IS EXTENDED

The Exchange Agent for the Offer is:

MELLON INVESTOR SERVICES LLC

Facsimile (for eligible institutions only):

(201) 296–4293

By Mail: Reorganization Department
P.O. Box 3301
South Hackensack, NJ 07606 By Hand: Reorganization Department
120 Broadway
13^th Floor
New York, NY 10271 By Overnight: Reorganization Department
85 Challenger Road
Mail Drop – Reorg
Ridgefield Park, NJ 07660

DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR TRANSMISSIONS OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF TRANSMITTAL IN THE APPROPRIATE SPACE PROVIDED THEREFOR AND COMPLETE THE SUBSTITUTE FORM W–9 SET FORTH BELOW.

THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.

        This Letter of Transmittal is to be completed by stockholders of Pontotoc Production, Inc. ("Pontotoc") if certificates for the Pontotoc Shares (as such term is defined below) are to be forwarded herewith or, unless an Agent's Message (as defined in the Prospectus, dated ________, 2001 (the "Prospectus")) is utilized, if delivery of the Pontotoc Shares is to be made by book–entry transfer into an account maintained by the Exchange Agent at The Depository TrustCompany (the "Book–Entry Transfer Facility")pursuant to the procedures set forth under "The Offer – Procedure for Tendering" in the Prospectus. Stockholders who tender Pontotoc Shares by book–entry transfer are referred to herein as "Book–Entry Stockholders" and other stockholders who deliver Pontotoc Shares are referred to herein as "Certificate Stockholders"

        Holders of the Pontotoc Shares whose certificates for such shares are not immediately available or who cannot deliver either the certificates for, or a book–entry confirmation (as defined in "The Offer – Procedure for Tendering" of the Prospectus) with respect to, their Pontotoc Shares and all other required documents to the Exchange Agent prior to the Expiration Date, must tender their Pontotoc Shares according to the guaranteed delivery procedure set under "The Offer – Guaranteed Delivery" in the Prospectus. See Instruction 2 below. DELIVERY OF DOCUMENTS TO A BOOK–ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.

DESCRIPTION OF SHARES TENDERED
Names(s) & Address(es) of Registered Holder(s)                 (Please fill in, if blank, exactly as                                            name(s) appear(s) on certificate(s))	Share Certificate(s) and Shares Tendered   (Attach additional signed list if necessary)

Share Certificate (s)*	Total Number of Shares Represented by Certificate(s)*	Number of Shares Tendered**
Total Shares ................................................

*     Need not be completed by Book–Entry Stockholders.
**   Unless otherwise indicated, all Pontotoc Shares represented by certificates delivered to the
               Exchange Agent will be deemed to have been tendered.
               See Instruction 4. 

G CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING PONTOTOC SHARES THAT YOU OWN HAVE BEEN LOST OR DESTROYED AND SEE INSTRUCTION 11.

Number of shares represented by the lost or destroyed certificate(s): _______  

G	CHECK HERE IF PONTOTOC SHARES ARE BEING TENDERED BY BOOK–ENTRY TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH A BOOK–ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK–ENTRY TRANSFER FACILITY MAY DELIVER PONTOTOC SHARES BY BOOK–ENTRY TRANSFER):
	Name of Tendering Institution:
	Account Number: Transaction Code Number:
G	CHECK HERE IF PONTOTOC SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT, ENCLOSE A PHOTOCOPY OF SUCH NOTICE AND COMPLETE THE FOLLOWING:
	Name(s) of Registered Owner(s):
	Window Ticket Number (if any):
	Date of Execution of Notice of Guaranteed Delivery:
	Name of Institution that Guaranteed Delivery:
	Account Number: Transaction Code Number:

NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

Ladies and Gentlemen:

     The undersigned hereby tenders to Pontotoc Acquisition Corp. ("Purchaser"), a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation ("Ascent Energy"), the above–described shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"). The above–described Pontotoc Shares are being tendered pursuant to Purchaser's offer to exchange $9.00 in cash, without interest, and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.01 per share, having a liquidation preference equal to $2.50 (the "Ascent Energy Preferred Shares"), for each Pontotoc Share, upon the terms and subject to the conditions set forth in the Prospectus and in this Letter of Transmittal (which, together with any amendments or supplements hereto or thereto collectively constitute the "Offer"). The undersigned understands that Purchaser reserves the right to transfer or assign, in whole or from time to time in part, to one or more corporations directly or indirectly owned by Ascent Energy, the right to purchase all or any portion of the Pontotoc Shares tendered pursuant to the Offer, receipt of which is hereby acknowledged.

        Subject to, and effective upon, acceptance for payment for the Pontotoc Shares tendered herewith in accordance with the terms and subject to the conditions of the Offer (and if the Offer is extended or amended, the terms of any such extension or amendment), the undersigned hereby sells, assigns and transfers to, or upon the order of, Purchaser all right, title and interest in and to all of the Pontotoc Shares that are being tendered hereby and any and all dividends, distributions (including additional Pontotoc Shares) or rights declared, paid or issued with respect to the tendered Pontotoc Shares on or after the date hereof and payable or distributable to the undersigned on a date prior to the transfer to the name of Purchaser or nominee or transferee of Purchaser on Pontotoc's stock transfer records of the Pontotoc Shares tendered herewith (collectively, a "Distribution"), and appoints the Exchange Agent the true and lawful agent and attorney–in–fact of the undersigned with respect to such Pontotoc Shares (and any and all Distributions) with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest) to (a) deliver certificates for the Pontotoc Shares (and any and all Distributions) or transfer ownership of such Pontotoc Shares (and any and all Distributions) on the account books maintained by a Book–Entry Transfer Facility, together, in either case, with appropriate evidences of transfer, to the Exchange Agent for the account of Purchaser, (b) present such Pontotoc Shares (and any and all Distributions) for transfer on the books of Pontotoc and (c) receive all benefits and otherwise exercise all rights of beneficial ownership of such Pontotoc Shares (and any and all Distributions), all in accordance with the terms and subject to the conditions of the Offer.

        The undersigned irrevocably appoints designees of Purchaser as such stockholder's attorney–in–fact and proxy, with full power of substitution, to the full extent of such stockholder's rights with respect to the Pontotoc Shares tendered by such stockholder and accepted for payment by Purchaser and with respect to any and all other shares or other securities issued or issuable in respect of such Pontotoc Shares on or after the date hereof. Such appointment will be effective when, and only to the extent that, Purchaser accepts such Pontotoc Shares for payment. Upon such acceptance for payment, all prior proxies given by such stockholder with respect to such Pontotoc Shares (and such other shares and securities) will be revoked without further action, and no subsequent proxies may be given nor any subsequent written consents executed (and, if given or executed, will not be deemed effective). The designees of Purchaser will be empowered to exercise all voting and other rights of such stockholder as they in their sole discretion may deem proper at any annual or special meeting of Pontotoc's stockholders or any adjournment or postponement thereof, by written consent in lieu of any such meeting or otherwise. Purchaser reserves the right to require that, in order for the Pontotoc Shares to be deemed validly tendered, immediately upon Purchaser's payment for such Pontotoc Shares Purchaser must be able to exercise full voting rights with respect to such Pontotoc Shares.

        The undersigned hereby represents and warrants that (a) the undersigned has full power and authority to tender, sell, assign and transfer the Pontotoc Shares (and any and all Distributions) tendered hereby and (b) that the undersigned owns the Pontotoc Shares tendered hereby and that when the Pontotoc Shares are accepted for exchange by Purchaser, Purchaser will acquire good, marketable and unencumbered title to the Pontotoc Shares (and any and all Distributions), free and clear of all liens, restrictions, charges and encumbrances, and the same will not be subject to any adverse claim. The undersigned, upon request, will execute and deliver any additional documents deemed by the Exchange Agent or Purchaser to be necessary or desirable to complete the sale, assignment and transfer of the Pontotoc Shares tendered hereby (and any and all Distributions). In addition, the undersigned shall promptly remit and transfer to the Exchange Agent for the account of Purchaser any and all Distributions in respect to the Pontotoc Shares tendered hereby, accompanied by appropriate documentation of transfer; and pending such remittance or appropriate assurance thereof, Purchaser will be, subject to applicable law, entitled to all rights and privileges as the owner of any such Distribution and may withhold the entire purchase price or deduct from the purchase price the amount or value thereof, as determined by Purchaser in its sole discretion.

        The undersigned understands that no public trading market exists for the Ascent Energy Preferred Shares nor the common stock of Ascent Energy into which such shares are convertible. The undersigned reasonably believes that any Ascent Energy Preferred Shares acquired through the exchange of his Pontotoc Shares will be acquired for investment purposes only, for his own account or for the account of the person for whom or the entity for which he acts as a fiduciary, and not with a view to the sale or resale, distribution or transfer thereof.

        All authority herein conferred or agreed to be conferred shall not be affected by and shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Except as stated in the Prospectus, this tender is irrevocable.

        The undersigned understands that tenders of the Pontotoc Shares pursuant to any of the procedures described in "The Offer – Procedure for Tendering" of the Prospectus and in the instructions hereto will constitute a binding agreement between the undersigned and Purchaser upon the terms and subject to the conditions set forth in the Offer, including the undersigned's representation that the undersigned owns the Pontotoc Shares being tendered. Without limiting the foregoing, if the price to be paid in the Offer is amended, the price to be paid to the undersigned will be the amended price notwithstanding the fact that a different price is stated in this Letter of Transmittal. The undersigned recognizes that under certain circumstances set forth in the Prospectus, Purchaser may not be required to accept for payment any of the Pontotoc Shares tendered hereby.

        Unless otherwise indicated herein under "Special Issuance Instructions," the Ascent Energy Preferred Shares and a check for cash and/or any certificates for Pontotoc Shares not tendered or not accepted for exchange will be issued or returned in the name(s) of the registered holder(s) appearing under "Description of Shares Tendered." Similarly, unless otherwise indicated herein under "Special Delivery Instructions," the Ascent Energy Preferred Shares and a check for cash and/or any certificates for Pontotoc Shares not tendered or not accepted for exchange (and any accompanying documents, as appropriate) will be mailed to the address(es) of the registered holder(s) appearing above under "Description of Shares Tendered." In the event that both the "Special Delivery Instructions" and the "Special Issuance Instructions" are completed, the Ascent Energy Preferred Shares and a check for cash and/or certificate(s) for Pontotoc Shares not so tendered or accepted will be returned in the name of, and delivered to, the person or persons so indicated. Unless otherwise indicated herein under "Special Issuance Instructions," any Pontotoc Shares tendered herewith by book–entry transfer that are not accepted for exchange will be credited to the account at the Book–Entry Transfer Facility (as defined herein) designated above. The undersigned recognizes that Purchaser has no obligation, pursuant to the "Special Issuance Instructions," to transfer any Pontotoc Shares from the name(s) of the registered holder(s) thereof if Purchaser does not accept for exchange any or all of the Pontotoc Shares so tendered.

SPECIAL ISSUANCE INSTRUCTIONS
(See Instructions 1, 5, 6 and 7) To be completed ONLY if certificate(s) for the Pontotoc Shares not tendered or not accepted for payment and/or the Ascent Energy Preferred Shares and the check for the purchase price of the Pontotoc Shares accepted for exchange are to be issued in the name of someone other than the undersigned or if the Pontotoc Shares tendered by book–entry transfer which are not accepted for payment are to be returned by credit to an account maintained at a Book–Entry Transfer Facility. Issue:      G check      G certificates to: Name:_______________________________
                                   (Please Print) Address:_____________________________ ____________________________________
                       (Include Zip Code)
____________________________________
             (Tax Id. or Social Security No.)
               (See Substitute Form W–9) G Credit the Pontotoc Shares tendered by book–entry transfer that are not accepted for payment 
to _________.
_________________________________________
(________________ Account No.) SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 1, 5, 6 and 7) To be completed ONLY if certificate(s) for the Pontotoc Shares not tendered or not accepted for payment and/or the Ascent Energy Preferred Shares and the check for the purchase price of the Pontotoc Shares accepted for exchange are to be sent to someone other than the undersigned or to the undersigned at an address other than that shown above.


Mail:      G check      G certificates to: Name:_______________________________
                                   (Please Print) Address:_____________________________ ____________________________________
                       (Include Zip Code)
____________________________________
             (Tax Id. or Social Security No.)
               (See Substitute Form W–9)

SIGN HERE
AND COMPLETE SUBSTITUTE FORM W–9

SIGN HERE __________________________________________________________________________________

SIGN HERE __________________________________________________________________________________

Dated:__________________________________________________________________________________ , 2001
(Must be signed by registered holder(s) exactly as name(s) appear(s) on certificate for the Pontotoc Shares or on a security position listing or by person(s) authorized to become registered holder(s) by certificates and documents transmitted herewith. If signature is by trustees, executors, administrators, guardians, attorneys–in–fact, officers of corporations or others acting in a fiduciary or representative capacity, please provide the following information and see Instruction 5.)

Name(s):____________________________________________________________________________________
                                                                          (Please Print)

Capacity (full title):_____________________________________________________________________________

Address:_____________________________________________________________________________________

____________________________________________________________________________________________
                                                                       (Include Zip Code)

Area Code and Telephone Number:_________________________________________________________________

Tax Identification or Social Security Number:__________________________________________________________

GUARANTEE OF SIGNATURE(S)
(See Instructions 1 and 5)

Authorized Signature:___________________________________________________________________________

Name:_______________________________________________________________________________________

Name of Firm:__________________________________________________________________________________
                                                                           (Please Print)

Address:_____________________________________________________________________________________
                                                                       (Include Zip Code)

Area Code and Telephone Number:_________________________________________________________________

Dated:_______________________ , 2001

INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer

     1.         Guarantee of Signatures. No signature guarantee is required on this Letter of Transmittal (a) if this Letter of Transmittal is signed by the registered holder(s) (which term, for purposes of this document, shall include any participant in a Book–Entry Transfer Facility whose name appears on a security position listing as the owner of the Pontotoc Shares) of the Pontotoc Shares tendered herewith, unless such holder(s) has completed either the box entitled "Special Issuance Instructions" or the box entitled "Special Delivery Instructions" above, or (b) if such Pontotoc Shares are tendered for the account of a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program (each of the foregoing being referred to as an "Eligible Institution"). In all other cases, all signatures on this Letter of Transmittal must be guaranteed by an Eligible Institution. See Instruction 5 of this Letter of Transmittal.

     2.         Delivery of Letter of Transmittal and Pontotoc Shares; Guaranteed Delivery Procedures. This Letter of Transmittal is to be completed by stockholders of Pontotoc either if Share certificates are to be forwarded herewith or, unless an Agent=s Message is utilized, if delivery of the Pontotoc Shares is to be made by book–entry transfer pursuant to the procedures set forth herein and in "The Offer – Procedure for Tendering" of the Prospectus. For a stockholder to validly tender Pontotoc Shares pursuant to the Offer, either (a) a properly completed and duly executed Letter of Transmittal (or a properly completed and manually signed facsimile thereof), together with any required signature guarantees or an Agent's Message (in connection with book–entry transfer) and any other required documents, must be received by the Exchange Agent at one of its addresses set forth herein prior to the Expiration Date and either (i) certificates for tendered Pontotoc Shares must be received by the Exchange Agent at one of such addresses prior to the Expiration Date or (ii) Pontotoc Shares must be delivered pursuant to the procedures for book–entry transfer set forth herein and in "The Offer – Procedure for Tendering" of the Prospectus and a Book–Entry Confirmation must be received by the Exchange Agent prior to the Expiration Date or (b) the tendering stockholder must comply with the guaranteed delivery procedures set forth herein and in "The Offer – Guaranteed Delivery" of the Prospectus.

        Stockholders whose certificates for Pontotoc Shares are not immediately available or who cannot deliver their certificates for the Pontotoc Shares and all other required documents to the Exchange Agent prior to the Expiration Date or who cannot comply with the book–entry transfer procedures on a timely basis may tender their Pontotoc Shares by properly completing and duly executing the Notice of Guaranteed Delivery pursuant to the guaranteed delivery procedure set forth herein and "The Offer – Guaranteed Delivery" of the Prospectus.

        Pursuant to such guaranteed delivery procedures, (i) such tender must be made by or through an Eligible Institution, (ii) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form provided by Purchaser, must be received by the Exchange Agent prior to the Expiration Date and (iii) the certificates for all tendered Pontotoc Shares, in proper form for transfer (or a Book–Entry Confirmation with respect to all tendered Pontotoc Shares), together with a properly completed and duly executed Letter of Transmittal (or a properly completed and manually signed facsimile thereof), with any required signature guarantees, or, in the case of a book–entry transfer, an Agent's Message, and any other required documents must be received by the Exchange Agent within three Nasdaq trading days after the date of execution of such Notice of Guaranteed Delivery. A "trading day" is any day on which the Nasdaq is open for business.

        The term "Agent's Message" means a message, transmitted by the Book–Entry Transfer Facility to, and received by, the Exchange Agent and forming a part of a Book–Entry Confirmation, which states that such Book–Entry Transfer Facility has received an express acknowledgment from the participant in such Book–Entry Transfer Facility tendering the Pontotoc Shares, that such participant has received and agrees to be bound by the terms of the Letter of Transmittal and that Purchaser may enforce such agreement against the participant.

        The signatures on this Letter of Transmittal cover the Pontotoc Shares tendered hereby.

        THE METHOD OF DELIVERY OF PONTOTOC SHARES, THIS LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK–ENTRY TRANSFER FACILITY, IS AT THE ELECTION AND RISK OF THE TENDERING STOCKHOLDER. PONTOTOC SHARES WILL BE DEEMED DELIVERED ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT (INCLUDING, IN THE CASE OF A BOOK–ENTRY TRANSFER, BY BOOK–ENTRY CONFIRMATION). IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.

     No alternative, conditional or contingent tenders will be accepted, and no fractional Pontotoc Shares will be purchased. All tendering stockholders, by executing this Letter of Transmittal (or facsimile thereof) waive any right to receive any notice of acceptance of their Pontotoc Shares for payment.

     3.         Inadequate Space. If the space provided herein is inadequate, the certificate numbers and/or the number of Pontotoc Shares and any other required information should be listed on a separate signed schedule attached hereto.

        4.        Partial Tenders. (Not Applicable to Book–Entry Stockholders.) If fewer than all the Pontotoc Shares evidenced by any share certificate submitted are to be tendered, fill in the number of Pontotoc Shares which are to be tendered in the box entitled "Number of Shares Tendered" under "Description of Shares Tendered." In such cases, new certificates for the remainder of Pontotoc Shares that were evidenced by your old certificates, but were not tendered by you, will be sent to you, unless otherwise provided in the appropriate box on this Letter of Transmittal, as soon as practicable after the Expiration Date or the termination of the Offer. All shares represented by share certificates delivered to the Exchange Agent will be deemed to have been tendered unless otherwise indicated.

        5.         Signatures on Letter of Transmittal, Stock Powers and Endorsements. If this Letter of Transmittal is signed by the registered holder(s) of the Pontotoc Shares tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the certificate(s) without alteration, enlargement or any change whatsoever.

           If any of the Pontotoc Shares tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal.

           If any of the tendered Pontotoc Shares are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of certificates.

          If this Letter of Transmittal or any Share certificate or stock power is signed by a trustee, executor, administrator, guardian, attorney–in–fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence satisfactory to Purchaser of the authority of such person so to act must be submitted.

          If this Letter of Transmittal is signed by the registered holder(s) of the Pontotoc Shares listed and transmitted hereby, no endorsements of certificates or separate stock powers are required unless payment is to be made to or certificates for Pontotoc Shares not tendered or not purchased are to be issued in the name of a person other than the registered holder(s). Signatures on such certificates or stock powers must be guaranteed by an Eligible Institution.

          If this Letter of Transmittal is signed by a person other than the registered holder(s) of the certificates(s) listed, the certificate(s) must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered holder(s) appear on the certificate(s). Signatures on such certificates or stock powers must be guaranteed by an Eligible Institution.

     6.         Stock Transfer Taxes. Except as otherwise provided in this Instruction 6, Purchaser will pay any stock transfer taxes with respect to the transfer and sale of Pontotoc Shares to it or its order pursuant to the Offer. If, however, payment of the purchase price is to be made to, or if certificate(s) for Pontotoc Shares not tendered or accepted for payment are to be registered in the name of, any person other than the registered holder(s), or if tendered certificate(s) are registered in the name of any person other than the person(s) signing this Letter of Transmittal, the amount of any stock transfer taxes (whether imposed on the registered holder(s) or such person) payable on account of the transfer to such person will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes or an exemption therefrom, is submitted.

        EXCEPT AS OTHERWISE PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATE(S) LISTED IN THIS LETTER OF TRANSMITTAL.

     7.        Special Issuance and Delivery Instructions. If Ascent Energy Preferred Shares and a check is to be issued in the name of, and/or certificates for Pontotoc Shares not tendered or not accepted for exchange are to be issued or returned to, a person other than the signer of this Letter of Transmittal or if a check and/or such certificates are to be returned to a person other than the person(s) signing this Letter of Transmittal or to an address other than that shown in this Letter of Transmittal, the appropriate boxes on this Letter of Transmittal must be completed. A Book–Entry Stockholder may request that Pontotoc Shares not accepted for payment be credited to such account maintained at a Book–Entry Transfer Facility as such Book–Entry Stockholder may designate under "Special Issuance Instructions." If no such instructions are given, such Pontotoc Shares not accepted for payment will be returned by crediting the account at the Book–Entry Transfer Facility designated above.

        8.       Waiver of Conditions. Subject to the terms and conditions of the Merger Agreement (as defined in the Prospectus) Purchaser reserves the right to waive, at any time or from time to time, any of the specified conditions of the Offer (other than the minimum tender condition and the conditions relating to the absence of an injunction and the effectiveness of the registration statement for the Ascent Energy Preferred Shares to be issued in the Offer) in whole or in part in the case of any Pontotoc Shares tendered.

         9.        31% Backup Withholding; Substitute Form W–9. Under U.S. Federal income tax law, a stockholder whose tendered Pontotoc Shares are accepted for payment is required to provide the Exchange Agent with such stockholder=s correct taxpayer identification number ("TIN") on Substitute Form W–9 below. If the Exchange Agent is not provided with the correct TIN, the Internal Revenue Service may subject the stockholder or other payee to a $50 penalty. In addition, payments that are made to such stockholder or other payee with respect to the Pontotoc Shares purchased pursuant to the Offer may be subject to 31% backup withholding.

        Certain stockholders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. In order for a foreign individual to qualify as an exempt recipient, the stockholder must submit a Form W–8, signed under penalties of perjury, attesting to that individual=s exempt status. A Form W–8 can be obtained from the Exchange Agent. See the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W–9" for more instructions.

        If backup withholding applies, the Exchange Agent is required to withhold 31% of any such payments made to the stockholder or other payee. Backup withholding is not an additional tax. Rather, the tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service.

        The box in Part 3 of the Substitute Form W–9 may be checked if the tendering stockholder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 3 is checked, the stockholder or other payee must also complete the "Certificate of Awaiting Taxpayer Identification Number" below in order to avoid backup withholding. Notwithstanding that the box in Part 3 is checked and the "Certificate of Awaiting Taxpayer Identification Number" is completed, the Exchange Agent will withhold 31% of all payments made prior to the time a properly certified TIN is provided to the Exchange Agent.

        The stockholder is required to give the Exchange Agent the TIN (e.g., social security number or employer identification number) of the record owner of the Pontotoc Shares or of the last transferee appearing on the transfers attached to, or endorsed on, the Pontotoc Shares. If the Pontotoc Shares are in more than one name or are not in the name of the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute form W–9" for additional guidance on which number to report.

     10.         Requests for Assistance or Additional Copies. Questions or requests for assistance may be directed to the Information Agent at its address and telephone number set forth below. Additional copies of the Prospectus, this Letter of Transmittal and the Notice of Guaranteed Delivery may also be obtained from the Information Agent or from brokers, dealers, commercial banks or trust companies.

         11.         Lost, Destroyed or Stolen Certificates. If any certificate representing Pontotoc Shares has been lost, destroyed or stolen, the stockholder should promptly notify Pontotoc's transfer agent, Corporate Stock Transfer, at (303) 282–4800. The stockholder will then be instructed as to the steps that must be taken in order to replace the certificate. This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost or destroyed certificates have been followed.

        Important: This Letter of Transmittal (or a facsimile hereof), together with certificates or confirmation of Book–Entry Transfer or the Notice of Guaranteed Delivery, and all other required documents, must be received by the Exchange Agent prior to the Expiration Date.

PAYER=S NAME:      Mellon Investor Services LLC
Substitute Form W–9 Department of the Treasury Internal Revenue Service. Payee=s Request for Taxpayer Identification Number (ATIN@) Sign Here	Part 1 - PLEASE PROVIDE YOUR TIN IN THE BOX AT RIGHT AND CERTIFY BY SIGNING AND DATING BELOW:	Social Security Number or Employer Identification Number _____________________________
	Part 2 - Certification –– Under the penalties of perjury, I certify that: (1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me), and (2) I am not subject to backup withholding because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (the AIRS@) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding. CERTIFICATION INSTRUCTIONS –– You must cross out item (2) above if you have been notified by the IRS that you are currently subject to backup withholding because of under–reporting interest or dividends on your tax return. However, if after being notified by the IRS that you were subject to backup withholding you received another notification from the IRS that you were not subject to backup withholding, do not cross out such item (2).
	Signature____________________________ Date ________________________, 2001	Part 3 –– Awaiting TIN G

NOTE:    FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W–9 FOR ADDITIONAL DETAILS.

YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX
IN PART 3 OF THE SUBSTITUTE FORM W–9.

         CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER      

              I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office, or (2) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number by the time of payment, 31% of all reportable payments made to me will be withheld.

Signature ___________________________________                        Date _________________________________ , 2001

The Information Agent for the Offer is:

Innisfree M&A Incorporated

501 Madison Avenue, 20^th Floor
New York, New York 10022
Banks and Brokers Call Collect: (212) 750–5833
All Others Call Toll–free (888) 750–5834

EX-99 21 exhibit992.htm

Exhibit 99.2

NOTICE OF GUARANTEED DELIVERY
to
Tender Shares of Common Stock
of
Pontotoc Production, Inc.
to
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.
(Not to be used for Signature Guarantees)

        As set forth in "The Offer – Guaranteed Delivery" of the Prospectus described below, this instrument or one substantially equivalent hereto must be used to accept the Offer (as defined below) if certificates representing shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"), are not immediately available or if the procedure for delivery by book–entry transfer cannot be completed on a timely basis, or if time will not permit all required documents to reach the Exchange Agent on a timely basis. This instrument may be delivered by hand or transmitted by facsimile transmission or mailed to the Exchange Agent.

The Exchange Agent for the Offer is:

MELLON INVESTOR SERVICES LLC

Facsimile (for eligible institutions only):

(201) 296–4293

Confirm facsimile by telephone ONLY:

(201) 296–4860

By Mail: Reorganization Department 
P.O. Box 3301 
South Hackensack, NJ 07606 By Hand:  Reorganization Department 
120 Broadway
13^th Floor
New York, NY 10271 By Overnight: Reorganization Department
85 Challenger Road
Mail Drop – Reorg
Ridgefield Park, NJ 07660

        DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.

     This form is not to be used to guarantee signatures. If a signature on a Letter of Transmittal is required to be guaranteed by an Eligible Institution under the instructions thereto, such signature guarantee must appear in the applicable space provided in the signature box in the Letter of Transmittal.

        The Eligible Institution that completes this form must communicate the guarantee to the Exchange Agent and must deliver the Letter of Transmittal and certificates for Pontotoc Shares to the Exchange Agent within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution.

Ladies and Gentlemen:

        The undersigned hereby tender(s) to Pontotoc Acquisition Corp., a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation, upon the terms and subject to the conditions set forth in the Prospectus dated ________, 2001 (the "Prospectus"), and in the related Letter of Transmittal (which, together with the Prospectus, and as amended from time to time, constitute the "Offer"), receipt of which is hereby acknowledged, the number of shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation, pursuant to the guaranteed delivery procedure set forth in "The Offer – Guaranteed Delivery" in the Prospectus.

Signature(s):	Address(es):
Name(s) of Record Holders:   ____________________________________                                           Please Type or Print	Zip Code: ________________________________
	Area Code and Tel No(s):
Number of Shares:
Certificate Nos. (If Available) ______________________________________ ______________________________________	Check box if Shares will be       tendered by book–entry transfer G
	Account Number:

Dated:                                                     , 2001

GUARANTEE
(Not to be used for signature guarantee)

     The undersigned, a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program (an "Eligible Institution" as defined in Rule 17Ad–15 under the Securities Exchange Act of 1934, as amended), guarantees to deliver to the Exchange Agent either certificates representing all tendered Pontotoc Shares, in proper form for transfer, or confirmation of book–entry transfer of such Pontotoc Shares into the Exchange Agent's account at The Depository Trust Company, in either case with delivery of the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees or an Agent's Message (as defined in the Prospectus) and any other required documents, all within three Nasdaq Stock Market trading days after the date hereof.

        The Eligible Institution that completes this form must communicate the guarantee to the Exchange Agent and must deliver the Letter of Transmittal and certificates for Pontotoc Shares to the Exchange Agent within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution.

______________________________________                     __________________________________________
                              Name of Firm                                                                                           Authorized Signature

______________________________________                     Name:                                                                                          
                          Address                                                                                               Please Type or Print

______________________________________                    Title:                                                                                              
                          Zip Code

______________________________________                     Dated:                                                                              , 2001
               Area Code and Tel. No.

NOTE:    DO NOT SEND CERTIFICATES FOR PONTOTOC SHARES OR WITH THIS NOTICE. CERTIFICATES FOR PONTOTOC SHARES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.

EX-99 22 exhibit993.htm

Exhibit 99.3

OFFER TO EXCHANGE

Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON _______, 2001
UNLESS THE OFFER IS EXTENDED

To Brokers, Dealers, Commercial Banks,                                                                                                  ____________, 2001
     Trust Companies and Other Nominees:

        We have been appointed by Pontotoc Acquisition Corp. ("Purchaser"), a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation ("Ascent Energy"), to act as Exchange Agent in connection with Purchaser's offer to acquire all the outstanding shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"). Purchaser has offered to exchange $9.00 in cash and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.001 per share, having a liquidation value of $2.50 per share (the "Ascent Energy Preferred Shares"), for each outstanding Pontotoc Share, upon the terms and subject to the conditions set forth in the Prospectus dated ___________, 2001 (the "Prospectus") and in the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") enclosed herewith. The Offer is being made in connection with the Agreement and Plan of Merger, dated as January 19, 2001 (the "Merger Agreement"), among Ascent Energy, Purchaser and Pontotoc. The Merger Agreement provides, among other things, that following the completion of the Offer and the satisfaction or waiver, if permissible, of all conditions set forth in the Merger Agreement and in accordance with the General Corporation Law of the State of Nevada, Purchaser will be merged with Pontotoc (the "Merger"). Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Pontotoc Shares registered in your name or in the name of your nominee.

        The Offer is subject to several conditions set forth in the Prospectus, which you should review in detail.

        Enclosed herewith for your information and forwarding to your clients are copies of the following documents:

        1.         Prospectus, dated ________, 2001.

     2.         The Letter of Transmittal to tender Pontotoc Shares for your use and for the information of your clients. Facsimile copies of the Letter of Transmittal may be used to tender the Pontotoc Shares.

     3.         The Notice of Guaranteed Delivery for Pontotoc Shares to be used to accept the Offer if certificates for Pontotoc Shares are not immediately available or if such certificates and all other required documents cannot be delivered to Mellon Investor Services LLC (the "Exchange Agent") by the Expiration Date or if the procedure for book–entry transfer cannot be completed by the Expiration Date.

        4.         Pontotoc's Solicitation/Recommendation Statement on Schedule 14D–9, which includes the recommendation of Pontotoc's Board of Directors that stockholders accept the Offer and tender their Pontotoc Shares to Purchaser pursuant to the Offer.

        5.         A printed form of letter which may be sent to your clients for whose accounts you hold Pontotoc Shares registered in your name or in the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Offer.

     6.       Guidelines for Certification of Taxpayer Identification Number on Substitute Form W–9. Stockholders who fail to complete and sign the Substitute Form W–9 may be subject to a required federal backup withholding tax of 31% of the gross proceeds payable to such stockholder or other payee pursuant to the Offer.

    YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON _____________, 2001, UNLESS THE OFFER IS EXTENDED.

     Pontotoc's Board of Directors has approved by unanimous vote the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger. Pontotoc's board of directors has also determined that the terms of the Offer and the Merger are fair to, and in the best interest of, the holders of the Pontotoc Shares and recommends that the holders of the Pontotoc Shares accept the Offer and tender to Purchaser pursuant to the Offer.

     Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment), Purchaser will accept for exchange Pontotoc Shares which are validly tendered and not withdrawn when, as and if Purchaser gives oral or written notice to the Exchange Agent of Purchaser's acceptance of such Pontotoc Shares for exchange pursuant to the Offer. Payment of cash and issuance of Ascent Energy Preferred Shares for Pontotoc Shares exchanged pursuant to the Offer will in all cases be made only after timely receipt by the Exchange Agent of (i) certificates for such Pontotoc Shares, or timely confirmation of a book–entry transfer of such Pontotoc Shares into the Exchange Agent's account at The Depository Trust Company, pursuant tot the procedures described in "The Offer – Procedure for Tendering" of the Prospectus, (ii) a properly completed and duly executed Letter of Transmittal (or a properly completed and manually signed facsimile thereof) or an Agent's Message (as defined in the Prospectus) in connection with a book–entry transfer and (iii) all other documents required by the Letter of Transmittal.

     In order to take advantage of the Offer, (i) a duly executed and properly completed Letter of Transmittal and any required signature guarantees, or an Agent=s Message (as defined in the Prospectus) in connection with a book–entry delivery of Pontotoc Shares, and other required documents should be sent to the Exchange Agent, and (ii) either certificates representing the tendered Pontotoc Shares should be delivered to the Exchange Agent, or such Pontotoc Shares should be tendered by book–entry transfer into the Exchange Agent's account maintained at one of the Book–Entry Transfer Facilities (as described in the Prospectus), all in accordance with the instructions set forth in the Letter of Transmittal and the Prospectus.

     If holders of Pontotoc Shares wish to tender, but it is impracticable for them to forward their certificates or other required documents on or prior to the expiration of the Offer or to comply with the book–entry transfer procedures on a timely basis, a tender may be effected by following the guaranteed delivery procedures specified in "The Offer – Guaranteed Delivery" of the Prospectus.

     Purchaser will not pay any commissions or fees to any broker, dealer or other person (other than the Exchange Agent and Innisfree M&A Incorporated (the "Information Agent") (as described in the Prospectus)) for soliciting tenders of Pontotoc Shares pursuant to the Offer. Purchaser will, however, upon request, reimburse you for customary clerical and mailing expenses incurred by you in forwarding any of the enclosed materials to your clients. Purchaser will pay or cause to be paid any stock transfer taxes payable on the transfer of Pontotoc Shares to it, except as otherwise provided in Instruction 6 of the Letter of Transmittal.

     Inquiries you may have with respect to the Offer should be addressed to the Information Agent or the undersigned, at the respective addresses and telephone numbers set forth on the back cover of the Prospectus. Additional copies of the enclosed materials may be obtained from the Information Agent.

Very truly yours,

                                                                       ______________________________

NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF ASCENT ENERGY, PURCHASER, PONTOTOC, THE EXCHANGE AGENT OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.

EX-99 23 exhibit994.htm

Exhibit 99.4

OFFER TO EXCHANGE

Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON _______, 2001,
UNLESS THE OFFER IS EXTENDED.

To Our Clients:

     Enclosed for your consideration are the Prospectus dated ________, 2001 (the "Prospectus") and the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") in connection with the offer by Pontotoc Acquisition Corp. ("Purchaser"), a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation ("Ascent Energy"), to exchange $9.00 in cash and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.001 per share, having a liquidation value of $2.50 (the "Ascent Energy Preferred Shares"), for each outstanding share of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"). The Offer is being made in connection with the Agreement and Plan of Merger, dated as of January 19, 2001 (the "Merger Agreement"), among Ascent Energy, Purchaser and Pontotoc. The Merger Agreement provides, among other things, that following the completion of the Offer and the satisfaction or waiver, if permissible, of all conditions set forth in the Merger Agreement and in accordance with the General Corporation Law of the State of Nevada, Purchaser will be merged with Pontotoc (the "Merger"). Holders of Pontotoc Shares whose certificates for such Pontotoc Shares are not immediately available or who cannot deliver their certificates for Pontotoc Shares and all other required documents to the Exchange Agent (as defined below) prior to the Expiration Date (as defined in the Prospectus), or who cannot complete the procedures for book–entry transfer on a timely basis, must tender their Pontotoc Shares according to the guaranteed delivery procedures set forth in "The Offer – Guaranteed Delivery" of the Prospectus.

     We are the holder of record (directly or indirectly) of Pontotoc Shares held by us for your account. A tender of such Pontotoc Shares can be made only by us as the holder of record and pursuant to your instructions. The enclosed Letter of Transmittal is furnished to you for your information only and cannot be used by you to tender Pontotoc Shares held by us for your account.

     We request instructions as to whether you wish to have us tender on your behalf any or all of the Pontotoc Shares held by us for your account, pursuant to the terms and subject to the conditions set forth in the Prospectus.

     Your attention is directed to the following:

     1.         The consideration per Pontotoc Share is $9.00 in cash, without interest, and one Ascent Energy Preferred Share having a liquidation value of $2.50.

     2.         The Offer is made for all of the outstanding Pontotoc Shares.

     3.         Pontotoc's board of directors has approved the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger. Pontotoc's board of directors has also determined that the terms of the Offer and the Merger are fair to, and in the best interests of, the holders of the Pontotoc Shares and recommends that holders of the Pontotoc Shares accept the Offer and tender their Pontotoc Shares to Purchaser pursuant to the Offer.

     4.         The Offer is being made pursuant to the Merger Agreement, which provides, among other things, that, subject to the terms and conditions of the Merger Agreement, subsequent to the consummation of the Offer, Purchaser will merge with Pontotoc.

     5.         The Offer and withdrawal rights will expire at 5:00 p.m., New York City time, on _______, 2001, unless the Offer is extended.

     6.         The Offer is conditioned upon, among other things, there being validly tendered and not properly withdrawn prior to the expiration of the Offer that number of Pontotoc Shares which represent not less than two–thirds of the total issued and outstanding Pontotoc Shares on a fully diluted basis. The Offer is subject to various other conditions set forth in the Prospectus, which you should review in detail.

        7.         No public trading market exists for the Ascent Energy Preferred Shares nor the common stock of Ascent Energy into which such shares are convertible. By signing below, you represent that to your reasonable belief, any Ascent Energy Preferred Shares acquired through the exchange of your Pontotoc Shares will be acquired for investment purposes only, for your own account or for the account of the person for whom or the entity for which you acts as a fiduciary, and not with a view to the sale or resale, distribution or transfer thereof.

        8.         Tendering stockholders will not be obligated to pay brokerage fees or commission or, except as set forth in Instruction 6 of the Letter of Transmittal, stock transfer taxes on the purchase of shares pursuant to the Offer.

   Except as disclosed in the Prospectus, Purchaser is not aware of any state in which the making of the Offer is prohibited by administrative or judicial action pursuant to any valid state statute. In any jurisdiction in which the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer will be deemed to be made on behalf of Purchaser by one or more registered brokers or dealers licensed under the laws of such jurisdiction.

     IF YOU WISH TO HAVE US TENDER ANY OR ALL OF THE PONTOTOC SHARES HELD BY US FOR YOUR ACCOUNT, PLEASE INSTRUCT US BY COMPLETING, EXECUTING AND RETURNING TO US THE INSTRUCTION FORM CONTAINED IN THIS LETTER. IF YOU AUTHORIZE A TENDER OF YOUR PONTOTOC SHARES, ALL SUCH PONTOTOC SHARES WILL BE TENDERED UNLESS OTHERWISE SPECIFIED IN SUCH INSTRUCTION FORM. YOUR INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER.

Instructions with Respect to
the Offer to Exchange
Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by Pontotoc Acquisition Corp.

     The undersigned acknowledge(s) receipt of your letter enclosing the Prospectus dated ________, 2001 (the "Prospectus") and the related Letter of Transmittal in connection with the offer by Pontotoc Acquisition Corp., a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation, to exchange $9.00 in cash and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.001 per share, having a liquidation value of $2.50, for each outstanding share of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation, upon the terms and subject to the conditions set forth in the Prospectus and the related Letter of Transmittal.

     This will instruct you to tender the number of Pontotoc Shares indicated below (or, if no number is indicated below, all Pontotoc Shares which are held by you for the account of the undersigned), upon the terms and subject to the conditions set forth in the Prospectus and in the related Letter of Transmittal furnished to the undersigned.

Number of Pontotoc Shares                                                                                                    SIGN HERE
          to be Tendered*
___________________Shares                                                                                                                                                              

Dated __________ , 2001                                                                                                                                                         
                                                                                                                                                       Signature(s)

                                                                                                                                                                                                          
                                                                                                                                              Please Print Name(s)

                                                                                                                                                                                                          
                                                                                                                                                         Address

                                                                                                                                                                                                          
                                                                                                                                   Area Code and Telephone Number

                                                                                                                        ___________________________________
                                                                                                                                                 Tax Identification or
                                                                                                                                               Social Security Number

_________________

*    Unless otherwise indicated, it will be assumed that all of your Pontotoc Shares held by us for your account are to be     tendered.

PLEASE RETURN THIS FORM TO THE BROKERAGE FIRM MANAGING YOUR ACCOUNT.

EX-99 24 exhibit995.htm

Exhibit 99.5

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W–9

Guidelines for Determining the Proper Identification Number to Give the Payer B Social Security numbers have nine digits separated by two hyphens: i.e., 000–00–0000. Employer identification numbers have nine digits separated by only one hyphen: i.e., 00–0000000. The table below will help determine the number to give the payer.

For this type of account:		Give the SOCIAL SECURITY number of B		For this type of account:	Give the EMPLOYER IDENTIFICATION number of B
1.	An individual=s account	The individual	9.	A valid trust, estate or pension trust	The legal entity (Do not furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title.)5
2.	Two or more individuals (joint account)	The actual owner of the account or, if combined funds, the first individual on the account1	10.	Corporate account	The corporation
3.	Husband and wife (joint account)	The actual owner of the account, or, if joint funds, either person1	11.	Religious, charitable, or educational organization account	The organization
4.	Custodian account of a minor (Uniform Gift to Minors Act)	The minor2	12.	Partnership account held in the name of the partnership	The partnership
5.	Adult and minor (joint account)	The adult or, if the minor is the only contributor, the minor1	13.	Association, club, or other tax–exempt organization	The organization
6.	Account in the name of guardian or committee for a designated ward, minor or incompetent person	The ward, minor, or incompetent person3	14.	A broker or registered nominee	The broker or nominee
7.	a.   The usual revocable savings trust account (grantor is also trustee) b.   So–called trust account that is not a legal or valid trust under State law	The grantor–trustee1 The actual owner1	15.	Account with the Department of Agriculture in the name of a public entity (such as a State or local government, school district, or prison) that receives agricultural program payments	The public entity
8.	Sole proprietorship account	The owner4

_______________________________________________________             ___________________________________

1     List first and circle the name of the person whose number you furnish.

2     Circle the minor=s name and furnish the minor=s social security number.

3     Circle the ward=s, minor=s or incompetent person=s name and furnish such person=s social security number.

4     Show your individual name. You may also enter your business name. You may use either your Social Security Number or your Employer Identification Number.

5     List first and circle the name of the legal trust, estate, or pension trust.

NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed.

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W–9
PAGE 2

Obtaining a Number

If you do not have a taxpayer identification number or you don=t know your number, obtain Form SS–5, Application for a Social Security Number Card (for individuals), or Form SS–4, Application for Employer Identification Number (for businesses and all other entities), at the local office of the Social Security Administration or the Internal Revenue Service (the AIRS@) and apply for a number.

Payees Exempt from Backup Withholding Payees specifically exempted from backup withholding on ALL payments include the following:
$ A corporation.
$ A financial institution.
$ An organization exempt from tax under Section 501(a) of the Internal Revenue Code of 1986, as amended (the ACode@), or an individual retirement plan.
$ The United States or any agency or instrumentalities.
$ A State, the District of Columbia, a possession of the United States, or any subdivision or instrumentality.
$ A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof.
$ An international organization or any agency or instrumentality thereof.
$ A registered dealer in securities or commodities registered in the U.S. or a possession of the U.S.
$ A real estate investment trust.
$ A common trust fund operated by a bank under Section 584(a) of the Code.
$ An exempt charitable remainder trust, or non–exempt trust described in Section 4947(a)(1) of the Code.
$ An entity registered at all times under the Investment Company Act of 1940.
$ A foreign central bank of issue. Payments of dividends and patronage dividends not generally subject to backup withholding include the following:
  $ Payments to nonresident aliens subject to withholding under Section 1441 of the Code.
  $ Payments to partnerships not engaged in a trade or business in the U.S. and which have at least one nonresident partner.
  $ Payments of patronage dividends where the amount
received is not paid in money.
  $ Payments made by certain foreign organizations.
  $ Payments made to a certain nominee. Payments of interest not generally subject to backup withholding include the following:
  $ Payments of interest on obligations issued by individuals.
    Note:     You may be subject to backup withholding if this  interest is $600 or more and is paid in the course of the payer=s trade or business and you have   not provided your correct taxpayer identification number to the payer.
  $ Payments of tax–exempt interest (including exempt–interest dividends under Section 852 of the Code).
  $ Payments described in Section 6049(b)(5) of the Code to nonresident aliens.
  $ Payments on tax–free covenant bonds under Section 1451 of the Code.
  $ Payments made by certain foreign organizations.
  $ Payments made to a nominee.

Exempt payees described above should file a Form W–9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE AEXEMPT@ ON THE FACE OF THE FORM, SIGN AND DATE THE FORM AND RETURN IT TO THE PAYER. IF YOU ARE A NONRESIDENT ALIEN OR A FOREIGN ENTITY NOT SUBJECT TO BACKUP WITHHOLDING, FILE WITH PAYER A COMPLETED INTERNAL REVENUE FORM W–8 (CERTIFICATE OF FOREIGN STATUS).          Certain payments other than interest, dividends and patronage dividends, that are not subject to information reporting are also not subject to backup withholding. For details, see Sections 6041, 6041A(a), 6045, 6050A and 6050N of the Code and the regulations promulgated therein.

Privacy Act Notice B Section 6109 requires most recipients of dividend, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to the IRS. The IRS uses the numbers for identification purposes. Payers must be given the numbers whether or not recipients are required to file tax returns. Payers must generally withhold 31% of taxable interest, dividends and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply.
Penalties
(1) Penalty for Failure to Furnish Taxpayer Identification Number B If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect.
(2) Civil Penalty for False Information with Respect to Withholding B If you make a false statement with no reasonable basis that results in no imposition of backup withholding, you are subject to a penalty of $500.
(3) Criminal Penalty for Falsifying Information B Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION, CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE.

EX-99 25 exhibit996.htm

Exhibit 99.6

January 10, 2001

Mr. Jeffrey Clark
Ascent Energy Inc.
c/o 201 St. Charles Ave.
Suite 5100
New Orleans, Louisiana 70170–5100

Dear Jeff:

Pursuant your request and our ongoing discussions regarding the provision of a new Senior Revolving Credit Facility for Ascent Energy Inc., we are pleased to commit USD 40 million with an initial Borrowing Base of USD 30 million for the purposes of providing a portion of the capital necessary to acquire the outstanding shares of Forman Petroleum Corp. and Pontotoc Production, Inc. ("Pontotoc") and for ongoing oil and gas development support.

A definitive Credit Agreement governing the subject Credit Facility, the basis of which is outlined in the Summary of Terms and Conditions attached to this letter as Addendum I, shall be completed between Fortis, you and other relevant parties associated with the subject transaction over the coming weeks.

We emphasize that our commitment represents a commitment from our institution and does not in any way include a commitment or other arrangements from any other non–affiliated institution.

Once again Jeff, it is our pleasure to provide the subject Senior Revolving Credit Facility. If you are in agreement with the attached Summary of Terms and Conditions, please indicate your acknowledgment and acceptance by executing this letter via signature in the space provided below. As always, please do not hesitate to contact me with any questions or comments you may have.

Very truly yours,

/s/ Darrell W. Holley
Darrell W. Holley
Managing Director
Fortis Capital Corp /s/ Deirdre M. Sanborn
Deirdre M. Sanborn
Vice President
Fortis Capital Corp.

AGREED AND ACCEPTED:                         /s/ Jeffrey Clarke                         DATE: _____________

By:                         Jeffrey Clark                                           
Title:                     President                                                

ASCENT ENERGY INC.
USD 40,000,000 SENIOR SECURED CREDIT FACILITY

Summary of Terms and Conditions

BORROWER:	Ascent Energy Inc.
ARRANGER / ADMINISTRATIVE AGENT	Fortis Capital Corp. ("Fortis")
LENDERS:	A syndicate of financial institutions (including Fortis) arranged by Fortis. These institutions shall be acceptable to Borrower and Administrative Agent .

FACILITY:	A senior secured revolving credit facility (the "Credit Facility") under which availability shall be limited to the lesser of (a) USD 40,000,000, or (b) the Borrowing Base in effect from time to time.
PURPOSE:	The proceeds of the Credit Facility shall be used (a) to provide a portion of the funds necessary to acquire the stock and associated assets of Pontotoc Production Inc., (b) to finance the future acquisition and development of oil and gas properties (c) to refinance existing debt of Pontotoc Production Inc., and (d) for ongoing liquidity needs.
MATURITY:	The Credit Facility shall terminate and all amounts outstanding shall be due and payable (3) years from the date of Closing (the "Maturity Date").
AVAILABILITY:	USD 30 million will be available at Closing based on the Initial Borrowing Base threshold. Borrower may borrow, repay and re–borrow on a revolving basis until the Maturity Date.
BORROWING BASE	The initial Borrowing Base will be USD 30 million.
	The Borrowing Base will be redetermined semi–annually by Lenders in their sole reasonable discretion throughout the duration of the Credit Facility, based on annual third party and semi–annual in house engineering provided by Borrower – all of which shall be acceptable to Administrative Agent. Any change in the Borrowing Base and or the amortization resulting from a redetermination (including any unscheduled redetermination referenced in the next succeeding paragraph) shall be approved by all Lenders. Any reduction in availability under the Borrowing Base shall be due within 90 days
	Lenders and Borrower shall each have the right to request one unscheduled redetermination of the Borrowing Base during each period of twelve consecutive months, provided that any such redetermination made by Lenders shall utilize Lender's standard methodology and criteria for transactions of this nature.
	A borrowing base deficiency will exist if the amount outstanding under the Credit Facility exceeds the Borrowing Base in effect at any time. Any deficiency must be eliminated, at Borrower's option, in either (a) a single lump sum, or (b) three equal monthly installments.
AMORTIZATION:	Interest payable quarterly in arrears, principal due at maturity.
SECURITY:	The Credit Facility shall be secured by all of the common shares of Forman Petroleum Corp. and Pontotoc Production Inc. owned (to be owned) by the Borrower and a first priority mortgage lien on existing and future acquired oil and gas properties and other rights/assets owned by Borrower and evaluated for purposes of the Borrowing Base. These mortgages shall cover such portion of the Borrower's Oil and Gas Properties which, in the aggregate, have a value (present value discounted at 10%) equal to a minimum of 85% of the total value of the Oil and Gas Properties included in the effective Borrowing Base, at all times.
	Borrower shall agree to deliver to Administrative Agent on behalf of Lenders deeds of trust, mortgages, chattel mortgages, security agreements, financing statements and other Security Documents in form and substance satisfactory to Administrative Agent for the purposes of granting, confirming and perfecting first and prior liens or security interests in any real property now owned or hereafter acquired by the Borrower or any current or future Subsidiary. Furthermore, Borrower agrees to deliver favorable title opinions from legal counsel acceptable to Administrative Agent with respect to Borrowers oil and gas properties and interests, based upon abstract or record examinations to dates acceptable to Administrative Agent and (i) stating that Borrower has good and defensible title to such properties and interests, free and clear of all Liens other than Permitted Liens (as shall be defined in the Credit Agreement governing this Facility); and (ii) confirming that such properties and interests are subject to Security Documents securing the Obligations that constitute and create legal, valid and duly perfected first deed of trust or mortgage liens in such properties and interests and first priority assignments of and security interests in the oil and gas attributable to such properties and interests and the proceeds thereof.
	Borrower shall have 60 days from closing to complete title work on oil and gas properties and other assets owned by Borrower, as utilized and considered in the determination of the effective Borrowing Base. Upon satisfactory completion of all required title work and the filing of all required mortgage documentation, in the Lender's sole discretion, Administrative Agent, on behalf of Lenders shall release the common shares of Forman Petroleum Corp. and Pontotoc Production Inc. owned (to be owned) by the Borrower as security for the subject Facility.
	The foregoing collateral shall ratably secure the Credit Facility and any commodity swap, interest rate swap or similar agreements with a Lender under the Credit Facility.
OPTIONAL PREPAYMENTS AND COMMITMENT REDUCTIONS:	Borrower may prepay the Credit Facility in whole or in part at any time without penalty, subject to reimbursement of the Lenders' breakage and redeployment costs in the case of prepayment of LIBOR borrowings.
CONDITIONS PRECEDENT TO CLOSING:	The initial funding of the Credit Facility will be subject to satisfaction of the conditions precedent deemed appropriate by Administrative Agent and the Lenders including, but not limited to, the following:
	Administrative Agent shall have received a fully executed copy of the Agreement and Plan of Merger governing the acquisition of Pontotoc Production Inc. and all relevant documentation relating to the acquisition and consolidation of Forman Petroleum Corp. by Borrower, along with all amendments thereto. Additionally, Administrative Agent shall have received all other material documents outside of the Agreement and Plan of Merger executed and/or delivered by Borrower and/or Forman Petroleum Corp. and Pontotoc Production Inc. in connection with any of the foregoing and the closing of the Forman Petroleum Corp. and Pontotoc Production Inc. acquisitions.
	Administrative Agent shall have confirmed completion of all material terms and conditions outlined in the Agreement and Plan of Merger governing the acquisition of Pontotoc Production Inc. and all relevant documentation relating to the acquisition and consolidation of Forman Petroleum Corp. by Borrower. The material Terms and Conditions of the Agreement and Plan of Merger governing the acquisition of Pontotoc Production Inc. and all relevant documentation relating to the acquisition and consolidation of Forman Petroleum Corp. by Borrower shall be satisfactory to Administrative Agent and Lenders in their sole discretion.
	The negotiation, execution and delivery of definitive documentation with respect to the Credit Facility shall have occurred and shall be satisfactory to Administrative Agent and the Lenders.
	Administrative Agent shall have received (a) satisfactory opinions of counsel to Borrower (which shall cover, among other things, authority, legality, validity, binding effect and enforceability of the documents for the Credit Facility) and such corporate resolutions, certificates and other documents as Administrative Agent shall reasonably require and (b) satisfactory evidence that Administrative Agent (on behalf of the Lenders) holds a perfected, first priority lien in all collateral for the Credit Facility under the conditions outlined herein, subject to no other liens except for permitted liens, to be determined.
	Administrative Agent and its counsel shall have reviewed and approved Borrower's and its subsidiaries articles or certificates of incorporation, bylaws, partnership agreements and other organizational documents and such certificates of officers of Borrower and its subsidiaries and of governmental authorities as Administrative Agent shall require to evidence the valid incorporation, organization and existence of Borrower.
	There shall not have occurred a material adverse change since September 30, 2000 in the business, assets, operations, condition (financial or otherwise) or prospects of Borrower or its subsidiaries or in the facts and information regarding such entities as represented to date. Fortis acknowledges that Borrower contemplates the issuance of certain Subordinated Indebtedness and Convertible Preferred Stock in connection with its acquisition of Pontotoc Production Inc. and Forman Petroleum Corp. The Terms of Subordination of such issuance and the documentation governing such issuance shall be subject to the approval of Lenders in their sole discretion.
	Administrative Agent shall have completed and approved within 60 days following the Closing Date, a review of title of Borrower's oil and gas properties as outlined herein, and the results of such review shall be acceptable to Administrative Agent in its sole discretion. Prior to Closing, the status of the environmental condition of the oil and gas properties and associated assets and operations shall have been identified, evaluated and disclosed to Administrative Agent. These findings shall be acceptable to Administrative Agent in its sole discretion.
	No action, suit, investigation or proceeding pending or threatened in any court or before any arbitrator or governmental authority that purports to affect Borrower or any transaction contemplated hereby, or that could have a material adverse effect on Borrower shall exist.
	Fortis acknowledges that the transaction contemplated may involve the exercise of certain dissenter's rights by shareholders of Forman Petroleum Corp. and/or Pontotoc Production Inc.
	Borrower and its subsidiaries shall be in compliance with all existing financial obligations.
	Administrative Agent shall have received and reviewed, with results satisfactory to Administrative Agent and its counsel, any material information regarding litigation, tax, accounting, labor, insurance, pension liabilities (actual or contingent), real estate leases, material contracts, debt agreements, property ownership, and contingent liabilities of Borrower and its subsidiaries.
	New equity proceeds equal to or in excess of USD 21.1 shall have been injected, and all other items necessary to perfect the Acquisition, consistent with the Proposed Sources and Uses Statement dated September 2000 (excluding the subject Facility) shall have been satisfied.
	Borrower shall be required to secure certain hedging arrangements involving approximately 50% of future production through December 2002. This percentage is based on the production estimates utilized by Administrative Agent in their determination of the Initial Borrowing Base. The specific terms and conditions surrounding such arrangements shall be outlined in the Credit Agreement governing the subject Facility.
REPRESENTATIONS AND WARRANTIES:	Usual and customary for transactions of this type, to include without limitation: (i) corporate status; (ii) corporate power and authority/enforceability; (iii) no violation of law or contracts or organizational documents; (iv) no material litigation; (v) correctness of specified financial statements and no material adverse change; (vi) no required governmental or third party approvals; (vii) use of proceeds/compliance with margin regulations; (viii) status under Investment Company Act; (ix) ERISA; (x) material environmental matters; (xi) perfected liens and security interests; (xii) payment of taxes; and (xiii) disclosure of material agreements, including all agreements pertaining to the Pontotoc Production Inc. Acquisition.
COVENANTS:	Usual and customary for transactions of this type, to include without limitation: (i) delivery of financial statements and other reports; (ii) delivery of compliance certificates; (iii) delivery of annual third party reserve reports and semi–annual internally prepared reserve reports and other information Administrative Agent or Lenders may reasonably request; (iv) notices of default, material litigation and material governmental and environmental proceedings; (v) compliance with laws; (vi) payment of taxes; (vii) maintenance of insurance; (viii) limitation on liens; (ix) limitations on mergers, consolidations and sales of assets; (x) limitations on incurrence of debt, excluding certain Subordinated Debt discussed herein; (xi) approval from Lenders on changes in senior management; (xii) limitations on dividends and stock redemptions and the redemption and/or prepayment of other debt; (xiii) limitations on investments; (xiv) ERISA; and (xv) limitation on transactions with affiliates. While the payment of certain dividends on preferred stock is contemplated, the terms under which payment of such dividends in cash can be made will be outlined in the final Credit Agreement.
	Financial covenants to include maintenance of (i) a Minimum Current Ratio of 1.0 to 1.0 (Current Ratio shall be defined as Current Assets divided by Current Liabilities); (ii) Maximum Total Debt to EBITDA of not more than 3.0 to 1.0; (iii) Minimum EBITDA to Cash Interest Expense of 3.5 to 1.0; and (iv) minimum Consolidated Tangible Net Worth of USD 40 million. EBITDA, for the purposes of calculating applicable ratios, shall be determined utilizing standard methodology under Generally Accepted Accounting Principals (GAAP). Consolidated Tangible Net Worth shall be defined as the remainder of all Consolidated Assets of Borrower, other than intangible assets (including as intangible assets such assets as patents, copyrights, licenses, franchise, goodwill, trade names, trade secrets and leases other than oil and gas or mineral leases or leases required to be capitalized under GAAP), minus Borrower's Consolidated liabilities. All financial ratios shall be calculated on a rolling four–quarter basis following the first anniversary of the Closing Date. Prior to this date, the period from the Closing Date to the relevant Quarterly Reporting Period shall be considered.
EVENTS OF DEFAULT:	Usual and customary in transactions of this nature, to include, without limitation, (i) nonpayment of principal, interest, fees or other amounts; (ii) violation of covenants; (iii) material inaccuracy of representations and warranties; (iv) cross–default to other material agreements and indebtedness; (v) bankruptcy; (vi) material judgments; (vii) ERISA; (viii) actual or asserted invalidity of any loan documents or security interests; and (ix) Change in Control of Borrower.
WAIVERS &  AMENDMENTS:	Amendments and waivers of the provisions of the Loan Agreement and other definitive documentation will require the approval of Required Lenders, including (i) increases in commitment amounts, (ii) reductions of principal, interest, or fees, (iii) extensions of scheduled maturities or times for payment, (iv) releases of all or substantially all collateral, (v) releases of guarantors, and (vi) increases in the Borrowing Base.
REQUIRED LENDERS:	Lenders holding 100% of the Loans and Commitment. At such time as there shall exist three or more Lenders that are party to the subject Facility and related Credit Agreement governing such Facility, Lenders shall consider the adoption of a "majority bank" concept as it relates to certain future approvals, waivers, amendments, etc. This potential amendment to the proposed initial Credit Agreement would involve an adjustment to the Required Lenders definition.
INDEMNIFICATION:	Borrower shall indemnify the Lenders from and against all losses, liabilities, claims, damages or expenses relating to their loans, Borrower's use of loan proceeds or the commitments, including but not limited to reasonable attorneys' fees and settlements costs. This indemnification shall survive and continue for the benefit of the Lenders at all times after Borrower's acceptance of the Lenders' commitment for the Credit Facility, notwithstanding any failure of the Credit Facility to close.
CLOSING:	On or before April 30, 2001.
GOVERNING LAW:	Texas
FEES/EXPENSES:	As outlined in ADDENDUM I
OTHER:	This term sheet is intended as an outline only and does not purport to summarize or finalize all the conditions, covenants, representations, warranties and other provisions, which would be contained in definitive legal documentation for the Credit Facility contemplated hereby. Borrower shall waive its right to a trial by jury.
COUNSEL FOR ADMINISTRATIVE AGENT:	Patton Boggs LLP

ADDENDUM I
FEES AND EXPENSES

ARRANGEMENT FEE:	1.00% of the initial Borrowing Base amount, payable at Closing. Upfront Fees paid to Lenders will be paid out of this amount at the sole discretion of Fortis Capital Corp.
ANNUAL AGENCY FEE:	USD 25,000, payable on the first anniversary of Closing and on each anniversary thereafter.
COMMITMENT FEE:	A commitment fee equal to the basis points set forth in the table below (calculated on a per annum basis based on the actual number of days elapsed in a year of 360 days) shall be payable on the unused portion of the Borrowing Base. The commitment fee shall be paid quarterly in arrears following the Closing.
INTEREST RATES:	The Credit Facility shall bear interest at a rate equal to LIBOR plus the Applicable LIBOR Margin; provided, that if during the 180 day period following the Closing, any breakage costs, charges or fees are incurred with respect to LIBOR loans on account of the syndication of the Credit Facility, Borrower shall immediately reimburse Administrative Agent for any such costs, charges or fees. Such right of reimbursement to be in addition to and not in limitation of customary cost and yield protection.
	Borrower may select interest periods of 1, 2, 3 or 6 months for LIBOR Loans, subject to availability (limit of 3 LIBOR Loans outstanding at any one time).
	A penalty rate shall apply on all loans in the event of default at a rate per annum of 3.00% above the applicable interest rate.
	The Applicable Margin, Commitment Fee in effect on any day shall be determined based on the ratio of usage of the Credit Facility to the Borrowing Base in effect on such date in accordance with the table below.

Level	Utilization of Borrowing Base	Applicable LIBOR margin	Commitment Fee
First 6 months after Closing	N/A	250 bps	50.0 bps
I	> or = 75%	250 bps	50.0 bps
II	74% – 50%	225 bps	50.0 bps
III	49–25%	200 bps	37.5 bps
IV	< or = 24%	175 bps	37.5 bps

COST AND YIELD PROTECTION:	The usual for transactions and facilities of this type, including, without limitation, in respect of prepayments, changes in capital adequacy and capital requirements or their interpretation, illegality, withholding taxes, unavailability, reserves without proration or offset.
EXPENSES:	Borrower will pay all reasonable costs and expenses associated with the preparation, due diligence, administration, syndication and enforcement of all documents executed in connection with the Credit Facility, including without limitation, the legal fees of Administrative Agent's counsel regardless of whether or not the Credit Facility is closed.

The aforementioned Summary of Terms and Conditions does not represent or convey a final commitment to lend or deliver under the Terms and Conditions outlined herein. Any such commitment is subject to the execution by Fortis Capital Corp., Lenders, and Ascent Energy Inc. of a definitive Credit Agreement and various other related documentation, satisfactory to all parties.

-----END PRIVACY-ENHANCED MESSAGE-----

EX-3.1

Exhibit 3.1

CERTIFICATE OF INCORPORATION
OF
ASCENT ENERGY INC.

ARTICLE I
Name

        The name of this corporation is Ascent Energy Inc. (the "Corporation").

ARTICLE II
Registered Office and Registered Agent

        The address of the Corporations registered office in the State of Delaware and its registered agent at such address is:

The Corporation Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
County of New Castle

ARTICLE III
Purpose

        The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the Delaware General Corporation Law (the"DGCL").

ARTICLE IV
Capital

        1.     Authorized Stock.     The Corporation shall be authorized to issue an aggregate of 30,000,000 shares of capital stock, of which 20,000,000 shares shall be Common Stock, $0.001 par value per share (the "Common Stock"), and 10,000,000 shares shall be Preferred Stock, $0.001 par value per share (the "Preferred Stock").

        2.   Preferred Stock.     Preferred Stock may be issued from time to time in one or more series. All shares of any one series of Preferred Stock shall be identical except as to the dates of issue and the dates from which dividends on shares of the series issued on different dates will cumulate if cumulative.

         (a)     Authority is hereby expressly granted to the Board of Directors to authorize the issue of one or more series of Preferred Stock, and to fix by resolution or resolutions providing for the issue of each such series the voting powers, designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof, of such series, to the full extent now or hereafter permitted by law, including, without limitation, the following:

         (1)     the number of shares of such series, which may subsequently be increased, except as otherwise provided by the resolution or resolutions of the Board of Directors providing for the issue of such series, or decreased, to a number not less than the number of shares then outstanding, by resolution or resolutions of the Board of Directors, and the distinctive designation thereof;

         (2)     the dividend rights of such series, the preferences, if any, over any other class or series of stock, or of any other class or series of stock over such series, as to dividends, the extent, if any, to which shares of such series will be entitled to participate in dividends with shares of any other series or class of stock, whether dividends on shares of such series will be fully, partially or conditionally cumulative, or a combination thereof, and any limitations, restrictions or conditions on the payment of such dividends;

         (3)     the rights of such series, and the preferences, if any, over any other class or series of stock, or of any other class or series of stock over such series, in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation and the extent, if any, to which shares of any such series will be entitled to participate in such event with any other series or class of stock;

         (4)     the time or times during which, the price or prices at which, and the terms and conditions on which the shares of such series may be redeemed;

         (5)     the terms of any purchase, retirement or sinking funds which may be provided for the shares of such series; and

         (6)     the terms and conditions, if any, upon which the shares of such series will be convertible into or exchangeable for shares of any other series, class or classes, or any other securities.

         (b)     The shares of Preferred Stock shall have no voting power or voting rights with respect to any matter whatsoever, except as may be otherwise required by law or may be provided in the resolution or resolutions of the Board of Directors creating the series of which such shares are a part.

        (c)     No holders of any series of Preferred Stock will be entitled to receive any dividends thereon other than those specifically provided for by this Certificate of Incorporation or the resolution or resolutions of the Board of Directors providing for the issue of such series of Preferred Stock, nor will any accumulated dividends on Preferred Stock bear any interest, unless specifically provided for by the resolution or resolutions of the Board of Directors providing for the issue of such series of Preferred Stock.

         (d)     In the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, the holders of Preferred Stock of each series will be entitled to receive only such amount or amounts as will have been fixed by this Certificate of Incorporation or by the resolution or resolutions of the Board of Directors providing for the issue of such series.

          3.     Common Stock.     All shares of the Common Stock of the Corporation shall be identical and except as otherwise required by law or as otherwise provided in the resolution or resolutions of the Board of Directors creating any series of Preferred Stock, if any, the holders of the Common Stock shall exclusively possess all voting power, and each share of Common Stock shall have one vote.

ARTICLE V
Business Opportunities

    1.     Definitions.     As used in this Article V, the following terms shall have the following meanings:

         (a)    "Affiliate"    shall mean, with respect to any specified person, (i) any Subsidiary (as defined below) of such person; (ii) any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person; (iii) any other person that owns, directly or indirectly, 10% or more of such specified person's capital stock; (iv) any officer or director of (A) any such specified person, (B) any subsidiary of such specified person, or (C) any person described in clause (ii) or (iii) above; or (v) any heir or legatee or other person having a relationship with any natural person by blood, marriage or adoption not more remote than first cousin or any person directly or indirectly controlling or controlled by or under common control with such other person described in this clause (v). For purposes of this definition, (x) "control," with respect to any specified person, means the possession of the power, whether or not exercised, to direct or cause the direction of the management or policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and the terms "controlling" and "controlled" have meanings correlative to the foregoing and (y) none of the Significant Stockholders shall be deemed to be an Affiliate of the Corporation, or vice versa.

         (b)    "Corporate Opportunity"     shall mean an investment or business opportunity or prospective economic advantage (i) that the Corporation is financially able, contractually permitted and legally able to undertake, (ii) that is, from its nature, the same as or similar to the Corporation's business or the business of any Subsidiary of the Corporation, and (iii) in which the Corporation could, but for the provisions of this Article V, have an interest or expectancy.

         (c)    "Significant Stockholder"    shall mean any holder of Capital Stock of the Corporation that, together with its Affiliates, is entitled to cast at least 25% of the Total Voting Power.

         (d)    "Subsidiary"     shall mean any corporation, partnership, joint venture or other legal entity of which such person (either directly or through or together with any other Subsidiary of such person), owns, directly or indirectly, 50% or more of the stock or other equity interests the holders of which are generally entitled to vote for the election of the board of directors or similar governing body of such corporation, partnership, joint venture or other legal entity.

        2.     Competing Activities.     Except as otherwise expressly provided in an agreement between the Corporation and any Significant Stockholder or among the Corporation and any two or more Significant Stockholders, (i) the Significant Stockholders of the Corporation, including, without limitation, their respective officers directors, agents, stockholders, members, partners and Affiliates, may engage or invest in, independently or with others, any business activity of any type or description, including without limitation those that might be the same as or similar to the Corporation's business or the business of any Subsidiary of the Corporation; (ii) neither the Corporation, any Subsidiary of the Corporation nor any stockholder of the Corporation shall have any right in or to such business activities or ventures or to receive or share in any income or proceeds derived therefrom; and (iii) to the extent required by applicable law in order to effectuate the purpose of this provision, the Corporation shall have no interest or expectancy, and specifically renounces any interest or expectancy, in any such business activities or ventures.

         3.    Corporate Opportunities.

       (a)     If any Significant Stockholder (or, as set forth below, any of its officers, directors, agents, stockholders, members, partners, employees or Affiliates) acquires knowledge of a potential transaction or matter which may be a Corporate Opportunity or otherwise is then exploiting any Corporate Opportunity, the Corporation shall have no interest in such Corporate Opportunity and no expectancy that such Corporate Opportunity be offered to the Corporation, any such interest or expectancy being hereby renounced, so that, as a result of such renunciation, and for the avoidance of doubt, such person (i) shall have no duty to communicate or present such Corporate Opportunity to the Corporation, (ii) shall have the right to hold any such Corporate Opportunity for its (and/or its officers', directors', agents', stockholders', members', partners', employees' or Affiliates') own account or to recommend, sell, assign or transfer such Corporate Opportunity to persons other than the Corporation or any Subsidiary of the Corporation, and (iii) shall not breach any fiduciary duty to the Corporation, in such person's capacity as a stockholder of the Corporation or otherwise, by reason of the fact that such person pursues or acquires such Corporate Opportunity for itself, directs, sells, assigns or transfers such Corporate Opportunity to another person, or does not communicate information regarding such Corporate Opportunity to the Corporation.

        (b)     In the event that a director, officer or employee of the Corporation who is also a director, officer, agent, stockholder, member, partner, employee or Affiliate of a Significant Stockholder acquires knowledge of a potential transaction or matter which may be a Corporate Opportunity for the Corporation or any of its Subsidiaries and such Significant Stockholder or any of its Affiliates, such director, officer or employee of the Corporation shall have fully satisfied and fulfilled the fiduciary duty of such director, officer or employee to the Corporation and its stockholders with respect to such Corporate Opportunity, if such director, officer or employee acts in a manner consistent with the following policy:

        (1) A Corporate Opportunity offered to any person who is a director, officer or employee of the Corporation, and who is also a director, officer, agent, stockholder, member, partner, employee or Affiliate of a Significant Stockholder, shall belong to the Corporation if such opportunity is expressly offered to such person in writing solely in his or her capacity as a director, officer or employee of the Corporation.

         (2) Otherwise, such Corporate Opportunity shall belong to such Significant Stockholder.

        4.     Notice to Holders.     Any person purchasing or otherwise acquiring any interest in shares of the Capital Stock of the Corporation shall be deemed to have notice of and to have consented to the provisions of this Article V.

        5.     Amendments.     Neither the alteration, amendment or repeal of this Article V nor the adoption of any provision of this Certificate of Incorporation inconsistent with this Article V shall eliminate or reduce the effect of this Article V in respect of any matter occurring, or any cause of action, suit or claim that, but for this Article V, would accrue or arise prior to such alteration, amendment, repeal or adoption.

ARTICLE VI
Board of Directors

         1.     Powers.     All of the powers of the Corporation are hereby conferred upon the Board of Directors of the Corporation, insofar as such powers may be lawfully vested by this Certificate of Incorporation in the Board of Directors. In furtherance and not in limitation of those powers, the Board of Directors shall have the power to make, adopt, alter, amend and repeal from time to time the Corporation's Bylaws, subject to the provisions of Article VIII, section 2.

        2.     Number of Directors.     Subject to the restriction that the number of directors shall not be less than the number required by the DGCL, the number of directors may be fixed from time to time pursuant to the Corporation's Bylaws; provided, however, that the number of directors shall not be reduced so as to shorten the term of any director at the time in office.

        3.    Classification.     The members of the Board of Directors, other than those who may be elected by the holders of any one or more series of Preferred Stock voting separately, shall be classified, with respect to the time during which they shall hold office, into three classes, designated Class I, II and III, as nearly equal in number as possible. Any increase or decrease in the number of directors shall be apportioned by the Board of Directors so that all classes of directors shall be as nearly equal in number as possible. At each annual meeting of stockholders, directors chosen to succeed those whose terms then expire shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election and until their successors are duly elected and qualified. The initial term for directors in Class I shall expire at the annual meeting of stockholders to be held in 2001; the initial term for directors in Class II shall expire at the annual meeting of stockholders to be held in 2002; and the initial term for directors in Class III shall expire at the annual meeting of stockholders to be held in 2003.

        4.    Vacancies.     Subject to any requirements of law and the rights of any class or series of Capital Stock having a preference over the Common Stock as to dividends or upon liquidation, and except as provided in section 6 of this Article VI, any vacancy on the Board of Directors (including any vacancy resulting from an increase in the authorized number of directors or from a failure of the stockholders to elect the full number of authorized directors) may, notwithstanding any resulting absence of a quorum of directors, be filled only by the Board of Directors, acting by a vote of a majority of all the directors remaining in office, and any director so appointed shall serve until the next stockholders' meeting held for the election of directors of the class to which such director shall have been appointed and until his successor is duly elected and qualified.

        5.    Removal.     Subject to section 6 of this Article VI, and notwithstanding any other provisions of this Certificate of Incorporation or the Corporation's Bylaws, any director or the entire Board of Directors may be removed at any time at a stockholders' meeting called for such purpose by the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class. At the same meeting in which the stockholders remove one or more directors, the stockholders may elect a successor or successors for the unexpired term of the director or directors removed. Except as set forth in this Article VI, section 5, directors shall not be subject to removal.

        6.    Directors Elected by Preferred Stockholders. Notwithstanding anything in this Certificate of Incorporation to the contrary, whenever the holders of any one or more series of Preferred Stock shall have the right, voting separately as a class, to elect one or more directors of the Corporation, the provisions of this Certificate of Incorporation (as amended from time to time) fixing the rights and preferences of such Preferred Stock shall govern with respect to the nomination, election, term, removal, vacancies or other related matters with respect to such directors.

ARTICLE VII
Limitation of Liability and Indemnification

        1.     Limitation of Liability.     No director shall be personally liable to the Corporation or its stockholders for monetary damages for any breach of fiduciary duty as a director, except (a) for breach of the director's duty of loyalty to the Corporation or its stockholders, (b) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, (c) pursuant to Section 174 of the DGCL, or (d) for any transaction from which such director derived an improper personal benefit.

         2.     Authorization of Further Actions.     The Board of Directors may (a) cause the Corporation to enter into contracts with directors providing for the limitation of liability set forth in this Article VII to the fullest extent permitted by law, (b) adopt Bylaws or resolutions, or cause the Corporation to enter into contracts, providing for indemnification of directors and officers of the Corporation and other persons (including without limitation directors and officers of the Corporation's direct and indirect subsidiaries) to the fullest extent permitted by law, and (c) cause the Corporation to exercise the powers set forth in Section 145(g) of the DGCL, notwithstanding that some or all of the members of the Board of Directors acting with respect to the foregoing may be parties to such contracts or beneficiaries thereof.

        3.     Subsidiaries.     The Board of Directors may cause the Corporation to approve for its direct and indirect subsidiaries limitation of liability and indemnification provisions comparable to the foregoing.

        4.     Amendments.     Any amendment or repeal of this Article VII shall not adversely affect any elimination or limitation of liability of a director of the Corporation under this Article VII with respect to any action or inaction occurring prior to the time of such amendment or repeal. No amendment or repeal of any Bylaw or resolution relating to indemnification shall adversely affect any person's entitlement to indemnification whose claim thereto results from conduct occurring prior to the date of such amendment or repeal.

ARTICLE VIII
Amendments; Definitions

        1.     Amendments to Certificate of Incorporation.     Articles V, VI, VII and VIII of this Certificate of Incorporation shall not be amended in any manner (whether by modification or repeal of an existing Article or Articles or by addition of a new Article or Articles), except upon resolutions adopted by the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class.

        2.    Amendments to Bylaws.     The Corporation's Bylaws may be altered, amended, or repealed or new Bylaws may be adopted by:

(a)     the stockholders, but only upon the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class; or

 (b)     the Board of Directors, but only upon the affirmative vote of a majority of the entire Board of Directors (unless a higher vote is specified in the Corporation's Bylaws).

        3.     Definitions.     For purposes of this Certificate of Incorporation:

        (a)     "Capital Stock" means any Common Stock, Preferred Stock or other shares of capital stock of the Corporation.

         (b)    "Total Voting Power" means the total number of votes that holders of Capital Stock are entitled to cast with respect to the election of directors or, if such term is used in reference to any other particular matter properly brought before the stockholders for their consideration and vote, means the total number of such votes that are entitled to be cast with respect to such matter.

ARTICLE IX
Incorporator

         The name and address of the incorporator of the Corporation is:

James D. Canafax
201 St. Charles Ave., 51st Floor
New Orleans, Louisiana 70170 

ARTICLE X
Initial Directors

 The following persons shall serve as the initial directors of the Corporation, each to serve in such capacity until the first annual meeting of stockholders or until their successors are duly elected and qualified:

Name	Class
Jeff Clarke Daniel O. Conwill, IV Nicholas W. Tell	Class I Director Class II Director Class III Director

ARTICLE XI
Books and Records

         The books of the Corporation may be kept (subject to any requirement of the DGCL) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the Corporation's Bylaws.

        IN WITNESS WHEREOF, the undersigned, being the named Incorporator of the Corporation, for the purpose of forming a corporation pursuant to the Delaware General Corporation Law, does make this Certificate of Incorporation, hereby declaring and certifying that this is his act and deed and the facts herein stated are true, and accordingly the undersigned has hereunto set his hand this 9th day of January, 2001.

                /s/ James D. Canafax               
James D. Canafax
Incorporator

EX-3.2

Exhibit 3.2

BYLAWS
OF
ASCENT ENERGY INC.

SECTION 1
Offices

        1.1     Registered Office.     The registered office of Ascent Energy Inc. (the "Corporation") shall be in the City of Wilmington, County of New Castle, State of Delaware.

        1.2     Other Offices.     The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.

SECTION 2
Meetings of Stockholders 

        2.1     Annual Meetings.     Unless directors are elected by written consent in lieu of an annual meeting, an annual meeting of stockholders shall be held for the election of directors at such date, time and place, if any, either within or without the State of Delaware, as shall be designated by the Board of Directors and stated in the notice of the meeting. If no designation is made, the place of meeting shall be the principal office of the Corporation. Notwithstanding the foregoing, the Board of Directors may, in its sole discretion, determine that any such annual meeting shall not be held at any designated place, but may instead be held solely by means of remote communication.

        2.2     Special Meetings.     (a) Special meetings of the stockholders for any purpose or purposes may be called by the Chairman of the Board or upon a majority vote of the Board of Directors, at such date, time and place, if any, either within or without the State of Delaware as shall be designated by the Board of Directors as set forth in Section 2.1 and stated in the notice of the meeting.

                 (b)     Except as otherwise provided in the Certificate of Incorporation or required by applicable law, the Secretary shall call a special meeting of the stockholders, to be held on such date as the Secretary shall determine, not less than 15 nor more than 60 days after the actual receipt of a request in writing of any Beneficial Owner or Owners of at least 10% of the Total Voting Power. Such request shall set forth:

                (i)     a complete and accurate description of the matter not to exceed 500 words, of the action proposed to be taken at such meeting, the reasons for the action and any material interest of the stockholder in the matter;

                 (ii)     the name, business address and residential address of each Beneficial Owner composing the group making the request, the Total Voting Power held by each such person and the dates on which each such person acquired his or her Capital Stock;

                (iii)     a representation that at least one such Beneficial Owner or a representative thereof intends to appear in person at the meeting to propose the action specified in the request; and

                (iv)     if any proposed action consists of or includes a proposal to amend either the Certificate of Incorporation or the Bylaws, the language of the proposed amendment.

The Secretary may require any person or persons submitting a request to call a special meeting of stockholders to furnish such documentary information as may be reasonably required by the Corporation to determine that such person or persons as a group Beneficially Owns at least 10% of the Total Voting Power. The Secretary may refuse to call a special meeting unless the request is made in compliance with the foregoing procedure.

        2.3     Notice of Stockholder Nominations and Stockholder Business.     (a) At any meeting of stockholders, only such business shall be conducted as shall have been properly brought before the meeting. Except as otherwise provided in the Certificate of Incorporation or required by applicable law, nominations for the election of directors at a meeting at which directors are to be elected or other matters to be properly brought before any meeting of stockholders (other than any special meeting of stockholders called pursuant to Section 2.2(b)) must be (i) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (ii) otherwise properly brought before the meeting by or at the direction of the Board of Directors, or (iii) otherwise properly brought before the meeting by any person who (A) has been for at least one year the Beneficial Owner of at least 1% of the Total Voting Power and (B) complies with the procedures set forth below.

                (b)     A notice of the intent of a stockholder to make a nomination or to bring any other matter before the meeting shall be made in writing and received by the Secretary not more than 270 days and not less than 120 days in advance of the first anniversary of the date on which the Corporation mailed notice and/or proxy materials in connection with the preceding year's annual meeting of stockholders or, if a special meeting or an annual meeting of stockholders is scheduled to be held either 30 days earlier or later than the preceding year's annual meeting, such notice shall be received by the Secretary within 15 days of the earlier of the date on which notice of such meeting is first mailed to stockholders or public disclosure of the meeting date is made.

                (c)     Every such notice by a stockholder shall set forth:

                (i)     the name, age, business address and residential address of the stockholder who intends to make a nomination or bring up any other matter, and any person acting in concert with such stockholder;

                (ii)     the number of shares of Capital Stock of which the stockholder is the Beneficial Owner, the dates on which such person acquired his or her Capital Stock and the Total Voting Power held by such person;

                (iii)     a representation that the stockholder intends to appear in person at the meeting to make the nomination or bring up the matter specified in the notice;

                (iv)     with respect to notice of an intent to make a nomination, a description of all agreements, arrangements or understandings among the stockholder, any person acting in concert with the stockholder, each proposed nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder;

                (v)     with respect to notice of an intent to make a nomination, (A) the name, age, business address and residential address of each person proposed for nomination, (B) the principal occupation or employment of such person, (C) the class and number of shares of Capital Stock of the Corporation of which such person is the Beneficial Owner, and (D) any other information relating to such person that would be required to be disclosed in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission had such nominee been nominated by the board of directors of a public company; and

                (vi)     with respect to notice of an intent to bring up any other matter, a complete and accurate description of the matter not to exceed 500 words, the reasons for conducting such business at the meeting, and any material interest of the stockholder in the matter.

                (d)     The Secretary may require any stockholder submitting a notice of an intent to make a nomination or bring up other business to furnish such documentary information as may be reasonably required by the Corporation to determine that such stockholder has been for at least one year the Beneficial Owner of at least 1% of the Total Voting Power entitled to vote on the proposed business.

                (e)     Notice of an intent to make a nomination shall be accompanied by the written consent of each nominee to serve as a director of the Corporation if so elected and an affidavit of each such nominee certifying that he or she meets the qualifications necessary to serve as a director. The Corporation may require any proposed nominee to furnish such other information as may be reasonably required by the Corporation to determine the eligibility and qualifications of such person to serve as a director.

                (f)     With respect to any proposal by a stockholder to bring before a meeting any matter other than the nomination of directors, the following shall govern:

                (i)     If the Secretary has received sufficient notice of a proposal that may properly be brought before the meeting, a proposal sufficient notice of which is subsequently received by the Secretary and that is substantially duplicative of the first proposal shall not be properly brought before the meeting. If in the judgment of the Board of Directors a proposal deals with substantially the same subject matter as a prior proposal submitted to stockholders at a meeting held within the preceding five years, it shall not be properly brought before any meeting held within three years after the latest such previous submission if (A) the proposal was submitted at only one meeting during such preceding period and it received affirmative votes representing less than 3% of the total number of votes cast in regard thereto, (B) the proposal was submitted at only two meetings during such preceding period and it received at the time of its second submission affirmative votes representing less than 6% of the total number of votes cast in regard thereto, or (C) the proposal was submitted at three or more meetings during such preceding period and it received at the time of its latest submission affirmative votes representing less than 10% of the total number of votes cast in regard thereto.

                (ii)     Notwithstanding compliance with all of the procedures set forth above in this Section, no proposal shall be deemed to be properly brought before a meeting of stockholders if, in the judgment of the Board of Directors, it is not a proper subject for action by stockholders under Delaware Law.

                (g)     At the meeting of stockholders, the chairman shall declare out of order and disregard any nomination or other matter that is not presented in accordance with the foregoing procedures or that is otherwise contrary to the foregoing terms and conditions.

        2.4     Notice of Meeting.     Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, if any, date and time of the meeting, the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and permitted to vote at such meeting, and the purpose or purposes for which the meeting is called. Unless otherwise provided by law, the written notice of any meeting shall be given to each stockholder entitled to vote at such meeting not less than 10 nor more than 60 days before the date of the meeting.

        2.5     Stockholder List.     The Secretary shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting.

        2.6     Quorum.     Except as otherwise provided by law, the Certificate of Incorporation or these Bylaws, with respect to each matter considered and voted upon at any stockholders' meeting, the holders of a majority of the outstanding shares of each class of Capital Stock, or series thereof, entitled to vote thereon, present in person or represented by proxy, shall constitute a quorum, provided that two or more classes or series shall be considered a single class if the holders thereof are entitled to vote together as a single class with respect to such matter. The Board of Directors may, in its sole discretion, adopt guidelines and procedures so that stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication, be deemed present in person at a meeting of stockholders, whether such meeting is to be held at a designated place or solely by means of remote communication. If, however, a quorum shall not be present or represented at any meeting of the stockholders (or with respect to any matter to be considered and voted upon thereat), the holders of any class of Capital Stock or series thereof entitled to vote thereat (or with respect to any such matter), present in person or represented by proxy, shall have the power to adjourn the meeting (or the vote upon such matter, without prejudice to the right of the stockholders to vote upon any matter as to which a quorum does exist) from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented any business may be transacted that might have been transacted at the meeting as originally notified. If the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting (or with respect to such matter).

        2.7     Vote Required.     When a quorum is present with respect to any matter considered at any meeting of stockholders, the vote of the holders of a majority of the Total Voting Power shall decide such matter, unless the matter is one upon which by express provision of law, the Certificate of Incorporation or these Bylaws, a different vote is required, in which case such express provision shall govern and control the decision of such matter.

        2.8     Voting Rights of Stockholders.     Unless otherwise provided in the Certificate of Incorporation, each stockholder shall at every meeting of the stockholders be entitled to one vote in person or by proxy for each share of Capital Stock held of record by such holder.

        2.9     Proxies and Electronic Voting.     (a) Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period.

                (b)     Execution of a proxy may be accomplished by a stockholder or his or her authorized officer, director, employee or agent signing such writing or causing his or her signature to be affixed to such writing by any reasonable means including, without limitation, by facsimile signature. A stockholder may authorize another person or persons to act for him as proxy by transmitting or authorizing the transmission of a telegram, cablegram, or other means of electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telegram, cablegram or other means of electronic transmission must either set forth or be submitted with information from which it can be determined that the telegram, cablegram or other electronic transmission was authorized by the stockholder. If it is determined that such telegrams, cablegrams or other electronic transmissions are valid, the inspectors shall specify the information upon which they relied.

                (c)     Any copy, facsimile telecommunication or other reliable reproduction of the writing or transmission may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission.

                (d)     A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy that is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or another duly executed proxy bearing a later date with the Secretary.

                (e)     The Board of Directors may, in its sole discretion, adopt guidelines and procedures so that stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication, participate in a meeting of stockholders, whether such meeting is to be held at a designated place or solely by means of remote communication, provided that (i) the Corporation shall implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder, (ii) the Corporation shall implement reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings, and (iii) if any stockholder or proxyholder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the Corporation.

                2.10     Consent in Lieu of Meeting.     Unless otherwise provided in the Certificate of Incorporation, any action required to be taken at any annual or special meeting of stockholders, or any action that may be taken at any annual or special meeting of such stockholders, including the election of directors, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of Capital Stock having not less than the minimum number of votes that would be necessary to authorize or take such action at an annual or special meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and who would have been entitled to notice of the meeting, had a meeting been held.

                2.11     Treasury Stock.     Shares of Capital Stock held in the treasury of the Corporation shall not be deemed to be outstanding shares for the purpose of voting or determining the presence of a quorum or the total number of shares entitled to vote on any matter.

                2.12     Presiding Officer.     All meetings of stockholders shall be presided over by the Chairman of the Board or, in his absence, by a chairman designated by the Board of Directors. The Secretary or, in the absence of the Secretary, an Assistant Secretary, shall act as secretary of the meeting, and in their absence, the chairman of the meeting may appoint any person to act as secretary of the meeting.

                2.13     Inspectors.     Prior to a meeting of stockholders, the Board of Directors shall appoint one or more inspectors to act at the meeting and make a written report thereof. Each inspector shall take and sign an oath faithfully to execute the duties of with strict impartiality and according to the best of his or her ability. The inspectors shall (i) ascertain the number of shares outstanding and the voting power of each, (ii) determine the shares represented at a meeting and the validity of the proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, (v) certify their determination of the number of shares represented at the meeting, and their count of all votes and ballots, and (vi) perform such other functions as the presiding officer of the meeting shall determine. The inspectors may appoint or retain other persons or entities to assist them in the performance of their duties.

                2.14     Adjournments.     Any annual or special meeting of stockholders may be adjourned by the presiding officer from time to time to reconvene at the same or some other place, if any, and notice need not be given of any such adjourned meeting if the time and place, if any, thereof and the means of remote communication, if any, by which stockholders and proxyholders may be deemed present and permitted to vote at such adjourned meeting, are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

SECTION 3
Directors

        3.1     Powers.     The business and affairs of the Corporation shall be managed under the direction of a Board of Directors, except as otherwise provided by Delaware Law or by the Certificate of Incorporation.

        3.2     Number.     Subject to the restriction that the number of directors shall not be less than the number required by Delaware Law, and subject further to the creation or lapse of directorships upon the occurrence of events specified in the Certificate of Incorporation, the number of directors shall be fixed, from time to time, by a resolution adopted by a majority of the directors then in office. Until otherwise fixed by the directors, the number of directors constituting the entire Board of Directors shall be no less than two and no more than seven. The Secretary shall have the power to certify at any time as to the number of directors authorized and as to the class to which each director has been elected or assigned.

        3.3     Classification.     The members of the Board of Directors, other than those who may be elected by the holders of any one or more series of Preferred Stock voting separately, shall be classified, with respect to the time during which they shall hold office, into three classes, designated Class I, II and III, as nearly equal in number as possible. Any increase or decrease in the number of directors shall be apportioned by the Board of Directors so that all classes of directors shall be as nearly equal in number as possible. At each annual meeting of stockholders, directors chosen to succeed those whose terms then expire shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election and until their successors are duly elected and qualified.

        3.4     Resignation.     Any director may resign at any time upon notice given in writing or by electronic transmission to the President or Secretary. Such resignation shall take effect at the time specified therein, and unless otherwise specified therein no acceptance of such resignation shall be necessary to make it effective.

        3.5     Nominations.     If an annual meeting of stockholders is held for the purpose of electing directors, any person nominated by a stockholder must be nominated in accordance with the procedures set forth in Section 2.3 to be eligible for election. Notwithstanding any provision of these Bylaws to the contrary, the provisions of Section 2.3 shall not apply to the election of any directors which the holders of any class or series of Preferred Stock, voting separately as a class, may be entitled to elect.

        3.6     Election of Directors.     Unless otherwise provided in the Certificate of Incorporation, at each meeting of the stockholders for the election of directors at which a quorum is present, directors shall be elected by a plurality of the Total Voting Power present in person or represented by proxy at the meeting.

        3.7     Compensation.     Unless otherwise restricted by the Certificate of Incorporation or of these Bylaws, the Board of Directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors. The directors may be paid a stated salary as director or a fixed sum for attendance at each meeting of the Board of Directors or committee. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor.

SECTION 4
Meetings of the Board of Directors

        4.1     Meetings.     The Board of Directors may hold meetings, both regular and special, either within or without the State of Delaware.

        4.2     Regular Meetings.     Regular meetings of the Board of Directors may be held without notice at such time and at such place as shall from time to time be determined by the Board of Directors.

        4.3     Special Meetings.     Special meetings of the Board of Directors may be called by the Chairman of the Board on at least 24 hours notice to each director, either personally or by mail, telephone, overnight courier service, facsimile transmission or other electronic transmission. Special meetings shall be called by the Chairman of the Board or the President in like manner and on like notice on the written request of any director. Any notice to call a special meeting pursuant to this section may be executed by the Secretary acting on behalf of the person calling the meeting.

        4.4     Quorum.     At all meetings of the Board of Directors a majority of the directors shall constitute a quorum for the transaction of business and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by law or by the Certificate of Incorporation. If a quorum shall not be present at any meeting of the Board of Directors, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

        4.5     Action at Meeting.     If a quorum is present when any meeting of the Board of Directors is convened, the directors may continue to do business, taking action by vote of a majority of a quorum as fixed in Section 4.4, until adjournment, notwithstanding the withdrawal of enough directors to leave less than a quorum or the refusal of any director present to vote.

        4.6     Action by Consent.     Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board of Directors or committee, as the case may be, consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board of Directors or committee.

        4.7     Meetings by Telephone.     Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, members of the Board of Directors or any committee designated by the Board of Directors may participate in a meeting of the Board of Directors or any committee, by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

        4.8     Presiding Officer.     The Chairman of the Board shall preside at all meetings of the Board of Directors or, in his absence, a chairman appointed by the Board of Directors. The Secretary or in the absence of the Secretary, an Assistant Secretary, shall act as secretary of each meeting, but in the absence of the Secretary and an Assistant Secretary, the chairman of the meeting may appoint any person to act as secretary of the meeting.

SECTION 5
Committees of the Board of Directors 

        5.1     Designation of Committees.     The Board of Directors may, by resolution passed by a majority of the directors then in office, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member.

        5.2     Authority of Committees.     Any such committee shall have those powers of the Board of Directors in the management of the business and affairs of the Corporation provided in the resolution of the Board of Directors designating such committee, provided that no such committee shall have the power or authority to propose amendments to the Certificate of Incorporation, adopt an agreement of merger or consolidation, recommend to the stockholders the sale, lease or exchange of all or substantially all of the Corporation's property or assets, recommend to the stockholders a dissolution of the Corporation or a revocation of a dissolution, or amend these Bylaws.

        5.3     Minutes.      Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required.

SECTION 6
Notices

        6.1     Form of Notice.     Whenever, under any provision of Delaware Law, the Certificate of Incorporation or these Bylaws, notice is required to be given to any director or stockholder and no provision is made as to how such notice shall be given, it shall not be construed to mean solely personal notice, but such notice may be given in writing (i) by mail, postage prepaid, addressed to such director or stockholder, at his address as it appears on the books or, in the case of a stockholder, the stock transfer records of the Corporation, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail, (ii) by overnight courier service, and such notice shall be deemed to be given the day following the day it is delivered to such service with all charges prepaid, (iii) by facsimile, telecopy or similar means, and such notice shall be deemed to be given the day it is transmitted with all charges prepaid, or (iv) by any other method permitted by law, such notice to be deemed to be given when received by the director or stockholder.

        6.2     Waiver.     Whenever any notice is required to be given to any stockholder or director under the provisions of Delaware Law, the Certificate of Incorporation or these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to receive such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of notice to such person or persons. Attendance of a stockholder or director at a meeting shall constitute a waiver of notice of such meeting, except when the person attends for the express purpose of objecting at the beginning of the meeting to the transaction of any business on the ground that the meeting is not lawfully called or convened.

SECTION 7
Officers

        7.1     General.     The officers of the Corporation shall be chosen by the Board of Directors at its first meeting after each annual meeting of stockholders and shall be a President, a Secretary and a Treasurer. The Board of Directors may also choose one or more Vice Presidents and one or more Assistant Secretaries and Assistant Treasurers. Any number of offices may be held by the same person, unless the Certificate of Incorporation or the Bylaws otherwise provide.

        7.2     Other Officers.     The Board of Directors may appoint such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors.

        7.3     Compensation.     The salaries of all officers and agents of the Corporation shall be fixed by the Board of Directors.

        7.4     Term.     The officers of the Corporation shall hold office until their successors are chosen and qualify. Subject to such obligations of the Corporation as may exist under any contract of employment, any officer elected or appointed by the Board of Directors may be removed at any time by the affirmative vote of a majority of the directors then in office. Any vacancy occurring in any office of the Corporation shall be filled by the Board of Directors.

        7.5     Chairman of the Board.     The Board of Directors may appoint a Chairman who shall preside at meetings of the Board of Directors and the stockholders and perform such other duties as may be designated by the Board of Directors or these Bylaws. The Chairman shall not, solely by virtue of such position, be an officer of the Corporation.

        7.6     President.     The President shall have the general powers, duties and responsibilities of supervision and management inherent in such office as well as such additional powers and duties as the Board of Directors may from time to time prescribe. The President shall be the chief executive officer and chief operating officer of the Corporation. The President shall control and direct the Corporation's business and, except as the Board of Directors may otherwise direct, shall supervise, direct and control the management and daily operations of the business of the Corporation and have general charge of the Corporation's property and supervision over the Corporation's officers, employees and agents. At the request of the Chairman of the Board, or in his absence or during his disability, the President shall perform the duties and exercise the functions of the Chairman of the Board. Except as the Board of Directors may otherwise authorize, the President shall execute bonds, mortgages and any other contracts of any nature on behalf of the Corporation. The President and any person performing the duties of the President in his absence or in the event of his inability or refusal to act shall be a United States citizen.

        7.7     Vice Presidents.     In the absence of the President or in the event of his inability or refusal to act, the Vice President (or in the event there be more than one Vice President, the Vice Presidents in the order designated by the Board of Directors, or in the absence of any designation, then in the order of their election) shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President. The Vice Presidents shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

        7.8     Secretary.     The Secretary shall attend all meetings of the Board of Directors and all meetings of the stockholders and record all the proceedings of the meetings of the Corporation and of the Board of Directors in a book to be kept for that purpose and shall perform like duties for the standing committees when required. He shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors or President, under whose supervision he shall be. He shall have custody of the corporate seal of the Corporation and he, or an Assistant Secretary, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by his signature or by the signature of such Assistant Secretary. The Board of Directors may give general authority to any other officer to affix the seal of the Corporation and to attest the affixing by his signature.

        7.9     Assistant Secretary.     The Assistant Secretary, or if there be more than one, the Assistant Secretaries in the order determined by the Board of Directors (or if there be no such determination, then in the order of their election) shall, in the absence of the Secretary or in the event of his inability or refusal to act, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

        7.10     Treasurer.     The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the President and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all his transactions as treasurer and of the financial condition of the Corporation. If required by the Board of Directors, he shall give the Corporation a bond (which shall be renewed every six years) in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of his office and for the restoration to the Corporation, in case of his death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the Corporation.

        7.11     Assistant Treasurer.     The Assistant Treasurer, or if there shall be more than one, the Assistant Treasurers in the order determined by the Board of Directors (or if there be no such determination, then in the order of their election) shall, in the absence of the Treasurer or in the event of his inability or refusal to act, perform the duties and exercise the powers of the Treasurer and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

SECTION 8
Stock

        8.1     Certificated or Uncertificated.     The shares of the Corporation shall be uncertificated or shall be represented by certificates signed in the name of the Corporation by the Chairman of the Board or the President or a Vice President and by the Secretary or an Assistant Secretary. Upon the face or back of each stock certificate issued to represent any partly paid shares, or upon the books and records of the Corporation in the case of uncertificated partly paid shares, shall be set forth the total amount of the consideration to be paid therefor and the amount paid thereon shall be stated.

        8.2     Summary of Rights.     The powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series of each class of stock, and of each series of any class, and the qualifications, limitations or restrictions of such preferences and rights shall be set forth in full or summarized on the face or back of the certificate that the Corporation shall issue to represent such class or series of stock; provided that, except as otherwise provided in Section 202 of Delaware Law, or in any act amending, supplementing or substituted for such section, in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate which the Corporation shall issue to represent such class or series of stock, a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and rights.

        8.3     Notice to Holders of Uncertificated Stock.     Within a reasonable time after the issuance or transfer of uncertificated stock, the Corporation shall send to the registered owner thereof a written notice containing the information required to be set forth or stated on certificates pursuant to Sections 151, 156, 202(a) or 218(a) of Delaware Law or a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and rights.

        8.4     Facsimile Signatures.     Any of or all the signatures on a certificate may be facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent or registrar at the date of issue.

        8.5     Lost Certificates.     The Board of Directors may direct a new certificate or certificates or uncertificated shares to be issued in place of any certificate or certificates theretofore issued by the Corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates or uncertificated shares, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the certificate alleged to have been lost, stolen or destroyed.

        8.6     Transfer of Stock.     Upon surrender to the Corporation or the transfer agent of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, it shall be the duty of the Corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Upon receipt of proper transfer instructions from the registered owner of uncertificated shares such uncertificated shares shall be cancelled and issuance of new equivalent uncertificated shares or certificated shares shall be made to the person entitled thereto and the transaction shall be recorded upon the books of the Corporation.

        8.7     Registered Stockholders.     Except as otherwise provided by law, the Corporation, and its directors, officers and agents, may recognize and treat a person registered on its records as the owner of shares, as the owner in fact thereof for all purposes, and as the person exclusively entitled to have and to exercise all rights and privileges incident to the ownership of such shares, and rights under this Section 8.7 shall not be affected by any actual or constructive notice that the Corporation, or any of its directors, officers or agents, may have to the contrary.

SECTION 9
Indemnification

        9.1     Indemnity.     (a) Except with respect to an action or Claim (other than as authorized in Section 9.2) commenced by an Indemnitee against the Corporation or by an Indemnitee as a derivative action by or in the right of the Corporation that has not been authorized by the Board of Directors, the Corporation shall indemnify, defend and hold harmless any Indemnitee against Expenses reasonably incurred or suffered in connection with any Claim against Indemnitee, whether the basis of such Claim is alleged action or inaction in an official or other capacity while serving as a director or officer of the Corporation or while serving at the request of the Corporation as a director, officer or fiduciary of another corporation, partnership, joint venture, trust or other enterprise or an employee benefit plan of the Corporation (including appearances as a witness or in connection with giving testimony or evidence), if:

        (i) the Indemnitee is successful in his defense of the Claim on the merits or otherwise, or

        (ii) the Indemnitee has been found by the Determining Body to have met the Standard of Conduct (as determined in accordance with the procedures set forth in this Section 9.1), provided that no indemnification shall be made in respect of any Claim by or in the right of the Corporation as to which Indemnitee shall have been adjudicated in a final judgment to be liable to the Corporation, unless, and only to the extent that the court in which such Claim was brought shall determine upon application that, despite such adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for such Expenses which the court shall deem proper.

                (b)     For purposes of this Section 9, the "Standard of Conduct" is met when conduct by an Indemnitee with respect to which a Claim is asserted was conduct performed in good faith which he reasonably believed to be in, or not opposed to, the best interest of the Corporation, and, in the case of a Claim which is a criminal action or proceeding, conduct that the Indemnitee had no reasonable cause to believe was unlawful. The termination of any Claim by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not meet the Standard of Conduct.

                (c)     Promptly upon becoming aware of the existence of any Claim as to which Indemnitee may be indemnified hereunder, Indemnitee shall notify the Chairman of the Board, but the failure to promptly notify the Chairman of the Board shall not relieve the Corporation from any obligation under this Section 9. Upon receipt of such request, the Chairman of the Board shall promptly advise the members of the Board of Directors of the request and that the establishment of a Determining Body with respect to Indemnitee's request for indemnification as to the Claim will be presented at the next regularly scheduled meeting of the Board of Directors. If a meeting of the Board of Directors is not regularly scheduled within 90 calendar days of the date the Chairman of the Board receives notice of the Claim, the Chairman of the Board shall cause a special meeting of the Board of Directors to be called within such period in accordance with the provisions of these Bylaws. After the Determining Body has been established, the Determining Body shall inform the Indemnitee of the constitution of the Determining Body and Indemnitee shall provide the Determining Body with all facts relevant to the Claim known to such Indemnitee, and deliver to the Determining Body all documents relevant to the Claim in Indemnitee's possession. Before the 60th day after its receipt from the Indemnitee of such information (the "Determination Date"), together with such additional information as the Determining Body may reasonably request of Indemnitee prior to such date (the receipt of which shall not begin a new 60-day period) the Determining Body shall determine whether or not Indemnitee has met the Standard of Conduct and shall advise Indemnitee of its determination. If Indemnitee shall have supplied the Determining Body with all relevant information, including all additional information reasonably requested by the Determining Body, any failure of the Determining Body to make a determination by or on the Determination Date as to whether the Standard of Conduct was met shall be deemed to be a determination that the Standard of Conduct was met by Indemnitee.

                (d)     If at any time during the 60-day period ending on the Determination Date, Indemnitee becomes aware of any relevant facts not theretofore provided by him to the Determining Body, Indemnitee shall inform the Determining Body of such facts, unless the Determining Body has obtained such facts from another source. The provision of such facts to the Determining Body shall not begin a new 60 day period.

                (e)     The Determining Body shall have no power to revoke a determination that Indemnitee met the Standard of Conduct unless Indemnitee (i) submits to the Determining Body at any time during the 60 days prior to the Determination Date fraudulent information, (ii) fails to comply with the provisions of Section 9.1(d), or (iii) intentionally fails to submit information or documents relevant to the Claim reasonably requested by the Determining Body prior to the Determination Date.

                (f)     In the case of any Claim not involving any threatened or pending criminal proceeding:

            (i)     if prior to the Determination Date the Determining Body has affirmatively made a determination that Indemnitee met the Standard of Conduct (not including a determination deemed to have been made by inaction), the Corporation may, in its sole discretion, after notice to Indemnitee, assume all responsibility for the defense of the Claim with counsel satisfactory to Indemnitee (who shall not, except with the written consent of Indemnitee, be counsel to the Corporation), and, in any event, the Corporation and the Indemnitee each shall keep the other informed as to the progress of the defense of the Claim, including prompt disclosure of any proposals for settlement; provided that if the Corporation is a party to the Claim and Indemnitee reasonably determines that there is any conflict between the positions of the Corporation and Indemnitee, with respect to the Claim or otherwise, then Indemnitee shall be entitled to conduct his defense with counsel of his choice at the Corporation's expense in accordance with the terms and conditions of this Section 9; and provided further that Indemnitee shall in any event be entitled at his expense to employ counsel chosen by him to participate in the defense of the Claim; and

        (ii)     The Corporation shall not be obligated to indemnify Indemnitee for any amount paid in a settlement that the Corporation has not approved. The Corporation shall fairly consider any proposals by Indemnitee for settlement of the Claim. If the Corporation proposes a settlement of the Claim and such settlement is acceptable to the person asserting the Claim, or the Corporation believes a settlement proposed by the person asserting the Claim should be accepted, it shall inform Indemnitee of the terms of such proposed settlement and shall fix a reasonable date by which Indemnitee shall respond. If Indemnitee agrees to such terms, he shall execute such documents as shall be necessary to make final the settlement. If Indemnitee does not agree with such terms, Indemnitee may proceed with the defense of the Claim in any manner he chooses, provided that if Indemnitee is not successful on the merits or otherwise, the Corporation's obligation to indemnify such Indemnitee as to any Expenses incurred following his disagreement shall be limited to the lesser of (A) the total Expenses incurred by Indemnitee following his decision not to agree to such proposed settlement or (B) the amount that the Corporation would have paid pursuant to the terms of the proposed settlement.

                (g)     In the case of any Claim involving a proposed, threatened or pending criminal proceeding, Indemnitee shall be entitled to conduct the defense of the Claim with counsel of his choice and to make all decisions with respect thereto; provided, that the Corporation shall not be obliged to indemnify Indemnitee for any amount paid in settlement of such a Claim unless the Corporation has approved such settlement.

                (h)     After notifying the Corporation of the existence of a Claim in accordance with Section 9.1(c), Indemnitee may from time to time request the Corporation to pay the Expenses (other than judgments, fines, penalties or amounts paid in settlement) that he incurs in pursuing a defense of the Claim prior to the time that the Determining Body determines whether the Standard of Conduct has been met. The Disbursing Officer shall pay to Indemnitee the amount requested (regardless of Indemnitee's apparent ability to repay such amount) upon receipt of an undertaking by or on behalf of Indemnitee to repay such amount along with any other amounts advanced or paid after the Determination Date in accordance with the provisions of this Section 9.1, if (i) the Determining Body determines prior to the Determination Date that Indemnitee did not meet the Standard of Conduct or (ii) Indemnitee is prohibited from being indemnified by the Corporation by virtue of the provisions of Delaware Law.

                (i)     After it has been determined that the Standard of Conduct has been met, for so long as and to the extent that the Corporation is required to indemnify Indemnitee under this Section 9, the provisions of Section 9.1(h) shall continue to apply with respect to Expenses incurred after such time except that (i) no undertaking shall be required of Indemnitee and (ii) the Disbursing Officer shall pay to Indemnitee the amount of any fines, penalties or judgments against him that have become final and for which he is entitled to indemnification hereunder, and any amount of indemnification ordered to be paid to him by a court.

                (j)     Any determination by the Corporation with respect to settlement of a Claim shall be made by the Determining Body.

                (k)     All determinations and judgments made by the Determining Body hereunder shall be made in good faith.

                (l)     The Corporation and Indemnitee shall keep confidential to the extent permitted by law and their fiduciary obligations all facts and determinations provided pursuant to or arising out of the operation of this Section 9 and the Corporation and Indemnitee shall instruct its or his agents and employees to do likewise.

        9.2     Enforcement.     The rights provided by this Section 9 shall be enforceable by Indemnitee in any court of competent jurisdiction. If Indemnitee seeks a judicial adjudication of his rights under this Section 9 Indemnitee shall be entitled to recover from the Corporation, and shall be indemnified by the Corporation against, any and all Expenses actually and reasonably incurred by him in connection with such proceeding but only if he prevails therein. If it shall be determined that Indemnitee is entitled to receive part but not all of the relief sought, then the Indemnitee shall be entitled to be reimbursed for all Expenses incurred by him in connection with such judicial adjudication if the amount to which he is determined to be entitled exceeds 50% of the amount of his claim. Otherwise, the Expenses incurred by Indemnitee in connection with such judicial adjudication shall be appropriately prorated.

        9.3     Reformation.     If any provision of this Section 9 is determined by a court having jurisdiction over the matter to violate or conflict with applicable law, the court shall be empowered to modify or reform such provision so that, as modified or reformed, such provision provides the maximum indemnification permitted by Delaware Law, and such provision, as so modified or reformed, and the balance of this Section 9 shall be applied in accordance with their terms. Without limiting the generality of the foregoing, if any portion of this Section 9 shall be invalidated on any ground, the Corporation shall nevertheless indemnify an Indemnitee to the full extent permitted by any applicable portion of this Section 9 that shall not have been invalidated and to the full extent permitted by law with respect to that portion that has been invalidated.

        9.4     Successors and Assigns.     This Section 9 shall be binding upon the Corporation, its successors and assigns, and shall inure to the benefit of the Indemnitee's heirs, administrators, executors, personal representatives and assigns and to the benefit of the Corporation, its successors and assigns.

        9.5     Amendments.      No amendment to or modification of this Section 9 or any portion hereof shall limit any Indemnitee's entitlement to indemnification in accordance with the provisions hereof with respect to any acts or omissions of Indemnitee which occur or accrue prior to such amendment or modification.

        9.6     Contribution.     If the indemnity provided for in this Section 9 is for any reason unavailable or insufficient to hold harmless an Indemnitee with respect to any Expenses, the Corporation shall make a contribution to the Indemnitee for such liabilities to which the Indemnitee may be subject in such proportion as is appropriate to reflect the intent of this Section 9.

        9.7     Reliance.     Each person who is serving as an Indemnitee shall be deemed to be doing so in reliance upon the indemnification provided for in this Section 9. The rights of an Indemnitee hereunder shall be contract rights and shall vest in the Indemnitee upon the occurrence of the event, or the first event in a chain of events, giving rise to such Claim; provided that the adoption of the Bylaws shall not affect any right or obligation of the Corporation or of any Indemnitee which existed prior to such adoption.

        9.8     Nonexclusivity.     (a)  The rights conferred herein on any person shall (i) be severable, (ii) not be exclusive of any other rights which such person may have or hereafter acquire under any statute, certificate of incorporation, contract or other agreement, authorization of stockholders or disinterested directors or otherwise, and (iii) continue as to an Indemnitee who has ceased to serve on behalf of the Corporation in respect of all claims arising out of action (or inaction) occurring prior to such time.

                (b)     It is the intent of the Corporation to indemnify and hold harmless Indemnitee to the fullest extent permitted by Delaware Law, as such law exists or may be amended after the date the Bylaws are adopted, but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than Delaware Law permitted prior to the amendment, notwithstanding any provision in Section 9 to the contrary.

        9.9     Insurance.     The Corporation may procure or maintain insurance or other similar arrangement on behalf of any Indemnitee or any person who is or was an employee or agent of the Corporation, or is serving at the request of the Corporation as an employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against or incurred by him in his capacity as such, or arising out of his status as such, whether or not the Corporation would have the power to indemnify him against such liability under the provisions of Delaware Law. Without limiting the power of the Corporation to procure or maintain any other kind of insurance or similar arrangement, the Corporation may create a trust fund or other form of self-insurance arrangement for the benefit of any Indemnitee or such other person to the fullest extent authorized by Delaware Law.

SECTION 10
General Provisions

        10.1     Fixing Record Date.     In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect to any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix in advance a record date which shall not be more than 60 nor less than ten days before the date of such meeting, nor more than 60 days prior to any other action. Except as otherwise provided in the Bylaws, a determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting, provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

        10.2     Dividends.     Dividends upon the Capital Stock of the Corporation, subject to the provisions of the Certificate of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the Certificate of Incorporation. Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for such other purpose as the directors shall think conducive to the interest of the Corporation, and the directors may modify or abolish any such reserve in the manner in which it was created.

        10.3     Checks.     All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

        10.4     Fiscal Year.     The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

        10.5     Seal.     The corporate seal shall have inscribed thereon the name of the Corporation and shall be in such form as may be approved from time to time by the incorporator, or, after the appointment of directors, the Board of Directors. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

SECTION 11
Definitions

        The following terms, for all purposes of the Bylaws, shall have the following meaning:

        "Affiliate" or "Associate" shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations promulgated under the Securities Exchange Act of 1934, as amended (the term "registrant" in such Rule 12b-2 meaning in this case the Corporation).

         A person shall be deemed to be the "Beneficial Owner" of any shares of Capital Stock (regardless whether owned of record):

        (1)     Which that person or any of its Affiliates or Associates, directly or indirectly, owns beneficially;

        (2)     Which such person or any of its Affiliates or Associates has (A) the right to acquire (whether exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (B) the right to vote pursuant to any agreement, arrangement or understanding; or

        (3)     Which are beneficially owned, directly or indirectly, by any other person with which such person or any of its Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of voting capital stock of the Corporation or any Subsidiaries.

        "Capital Stock" means any Common Stock, Preferred Stock or other shares of capital stock of the Corporation.

        "Certificate of Incorporation" shall mean the certificate of incorporation of the Corporation, as it may be amended from time to time, including by means of one or more certificates of designation.

        "Claim" shall mean any threatened, pending or completed claim, action, suit or proceeding, including appeals, whether civil, criminal, administrative or investigative and whether made judicially or extra-judicially, including any action by or in the right of the Corporation, or any separate issue or matter therein, as the context requires.

        "Common Stock" shall mean the common stock of the Corporation, as provided for in the Certificate of Incorporation.

        "Delaware Law" shall mean the General Corporation Law of the State of Delaware.

         "Determining Body" shall mean (i) those members of the Board of Directors who do not have a direct or indirect interest the Claim for which indemnification is being sought ("Impartial Directors"), if there are at least two Impartial Directors, (ii) a committee of at least two Impartial Directors appointed by the Board of Directors or a duly authorized committee thereof (regardless of whether the directors voting on such appointment are Impartial Directors) and composed of Impartial Directors, (iii) if there are fewer than two Impartial Directors or if the Board of Directors or a duly authorized committee thereof so directs (regardless whether the members thereof are Impartial Directors), independent legal counsel, which may be the regular outside counsel of the Corporation, as determined by the Impartial Directors or, if no such directors exist, the full Board of Directors or (iv) the stockholders.

        "Disbursing Officer" shall mean the Treasurer of the Corporation or, if the Treasurer has a direct or indirect interest in the Claim for which indemnification is being sought, any officer who does not have such an interest and who is designated by the Chairman of the Board to be the Disbursing Officer with respect to indemnification requests related to the Claim, which designation shall be made promptly after receipt of the initial request for indemnification with respect to such Claim.

        "Expenses" shall mean any expenses or costs, including, without limitation, attorney's fees, judgments, punitive or exemplary damages, fines, excise taxes or amounts paid in settlement.

        "Indemnitee" shall mean any person who is or was a director or officer of the Corporation or is or was serving at the request of the Corporation as a director, officer or fiduciary of another corporation, partnership, joint venture, trust or other enterprise (including, without limitation, employee benefit plans of the Corporation).

        "Preferred Stock" shall mean the preferred stock of the Corporation, as provided for in the Certificate of Incorporation.

        "Total Voting Power" shall mean the total number of votes that the holders of Capital Stock are entitled to cast with respect to the election of directors or, if such term is used in reference to any other particular matter properly brought before the stockholders for their consideration and vote, means the total number of such votes that are entitled to be cast with respect to such matter.

SECTION 12
Amendments

        The Corporation's Bylaws may be altered, amended, or repealed or new Bylaws may be adopted by:

                (a)     the stockholders, but only upon the affirmative vote of holders of not less than a majority of the Total Voting Power, voting together as a single class; or

                (b) the Board of Directors, but only upon the affirmative vote of a majority of the entire Board of Directors.

EX-4.1

Exhibit 4.1

CERTIFICATE OF DESIGNATIONS

of

8% SERIES A REDEEMABLE PREFERRED STOCK

of

ASCENT ENERGY INC.

(Pursuant to Section 151(g) of the
Delaware General Corporation Law)

        Ascent Energy Inc., a corporation organized and existing under the laws of the State of Delaware (the "Company"), hereby certifies that the following resolution was duly adopted by the board of directors of the Company (the "Board of Directors") by unanimous written consent dated _______, 2001, pursuant to Section 151(g) of the Delaware General Corporation Law:

        RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors in accordance with the provisions of the Certificate of Incorporation of the Company, the Board of Directors hereby creates a series of Preferred Stock, par value $0.001 per share, of the Company and hereby states the designation and number of shares, and fixes the relative rights, preferences and limitations thereof as follows:

        Section 1.     Designation and Amount.     The shares of this series of Preferred Stock shall be designated as "8% Series A Redeemable Preferred Stock" (the "Series A Redeemable Preferred Stock") and the number of shares constituting the Series A Redeemable Preferred Stock shall be 21,100. Such number of shares may be increased or decreased at any time by resolution of the Board of Directors; provided, however, no decrease shall reduce the number of shares of Series A Redeemable Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights, or warrants for, or upon the conversion or exchange of, any outstanding securities issued by the Company convertible or exchangeable into, Series A Redeemable Preferred Stock.

        Section 2.     Ranking.     The Series A Redeemable Preferred Stock shall rank, as to the payment of dividends and the distribution of the assets upon liquidation, dissolution or winding up of the Company: (a) on a parity with the Company's Series B Convertible Preferred Stock, par value $0.001 per share (the "Series B Convertible Preferred Stock"), (b) senior to or on a parity with all other classes and series of the Company's preferred stock, and (c) senior to the Company's common stock, par value $0.001 per share ("Common Stock").

        Section 3.     Liquidation.     Upon the voluntary or involuntary liquidation, winding up or dissolution of the Company (in connection with the bankruptcy or insolvency of the Company or otherwise), out of the assets available for distribution to shareholders, the holders of Series A Redeemable Preferred Stock shall be entitled to receive, in preference to any payment or distribution to the holders of Common Stock or any other stock of the Company ranking junior to the Series A Redeemable Preferred Stock, as to dividends, liquidation, dissolution or winding up, $1,000 per share (the "Preferred Liquidation Value") plus an amount equal to all Preferred Dividends (as defined in Section 4 below) (whether or not earned or declared) accrued and unpaid on each such share up to and including the date of final distribution to such holders. After the Preferred Liquidation Value and all accrued and unpaid Preferred Dividends have been paid on the Series A Redeemable Preferred Stock, the remaining assets shall be paid to the holders of Common Stock and other junior classes of stock in accordance with their respective priority, if any. In the event the net assets of the Company are insufficient to pay the holders of the Series A Redeemable Preferred Stock the full amount of their preference set forth above and the holders of any other series of capital stock of the Company ranking on a parity with the Series A Redeemable Preferred Stock the liquidating payments to which they are entitled, then the remaining net assets of the Company shall be divided among and paid to the holders of the shares of Series A Redeemable Preferred Stock and any such other capital stock of the Company ranking on a parity with the Series A Redeemable Preferred Stock ratably per share in proportion to the full per share amounts to which they would be entitled if all amounts payable thereon were paid in full, and the holders of Common Stock and other junior classes of stock will receive nothing. Neither a merger or consolidation of the Company with or into any other corporation or entity nor the sale of all or substantially all of the assets of the Company shall be deemed to be a liquidation, dissolution or winding up within the meaning of this provision.

        Section 4.     Dividends.     The Series A Redeemable Preferred Stock is entitled to receive, out of legally available funds, preferential cumulative dividends from the issuance date thereof at the annual rate of eight percent (8%) of the Preferred Liquidation Value per share ("Preferred Dividends"). All Preferred Dividends, if declared by the Board of Directors, shall be payable quarterly and promptly after the tenth business day of each January, April, July and October of each year (each, a "Dividend Payment Date"), commencing on July 10, 2001, to holders of record on the record date, which the Board of Directors shall fix not more than sixty (60) days or less than ten (10) days preceding a Dividend Payment Date. As provided below in Section 7(d), Preferred Dividends shall cease to accrue on shares of Series A Redeemable Preferred Stock on the date of their redemption. No dividend shall be declared on any other series or class or classes of stock to which the Series A Redeemable Preferred Stock ranks prior as to dividends or liquidation, in respect of any period, nor shall any shares of any such series or class be redeemed, purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series A Redeemable Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. No dividend shall be declared on any other series or class or classes of stock ranking on a parity with the Series A Redeemable Preferred Stock, as to dividends, in respect of any quarterly period, nor shall any shares of any such series or class be redeemed or purchased or otherwise acquired for any consideration (or any money be paid into any sinking fund or otherwise set apart for the purchase of any such shares), unless there shall have been or contemporaneously are declared and paid on all shares of the Series A Redeemable Preferred Stock at the time outstanding dividends for all quarterly periods coinciding with or ending before such quarterly period, ratably in proportion to the respective annual dividend rates per annum fixed therefor. Preferred Dividends shall also be payable upon any Redemption Date (as defined in Section 7(c) below) and upon the final distribution date relating to the dissolution, liquidation or winding up of the Company. Preferred Dividends shall begin to accrue on outstanding shares of Series A Redeemable Preferred Stock and to accumulate from the issuance date of such shares whether or not earned or declared, but Preferred Dividends for any period less than a full quarterly period between Dividend Payment Dates shall be computed on the basis of a 365-day year for the actual number of days elapsed. Preferred Dividends shall accrue whether or not there shall be (at the time any such dividend becomes payable or at any other time) profits, surplus or other funds of the Company legally available for the payment of dividends. Accumulations of dividends on shares of Series A Redeemable Preferred Stock shall not bear interest.

        Section 5.     Conversion Rights.     The Series A Redeemable Preferred Stock is not convertible into or exchangeable for any securities or other property of the Company.

        Section 6.     Voting Rights.

                    (a)     Except as set forth below or as otherwise provided by Delaware law, holders of shares of Series A Redeemable Preferred Stock shall not be entitled to vote such shares; provided, that in all cases where the holders of shares of Series A Redeemable Preferred Stock have the right to vote such shares, such holders shall be entitled to one vote for each such share held by them.

                    (b)     Without the affirmative vote of the holders of not less than a majority of the shares of Series A Redeemable Preferred Stock outstanding, voting together as a single class, the Company shall not amend or waive any of the provisions of the Certificate of Incorporation or this Certificate of Designations, which would materially and adversely affect any right, preference or privilege of the Series A Redeemable Preferred Stock or of the holders thereof; provided, however, that any increase in the amount of authorized Preferred Stock or the creation and/or issuance of other series of Preferred Stock, in each case ranking on a parity with or junior to the Series A Redeemable Preferred Stock, shall not be deemed to materially and adversely affect such rights, preferences or privileges and shall not require the consent of the holders of the then outstanding Series A Redeemable Preferred Stock; and provided further, that the authorization and/or issuance of additional shares of Series A Redeemable Preferred Stock and/or the creation and/or issuance of other series or classes of preferred stock ranking prior to the Series A Redeemable Preferred Stock shall be deemed to materially and adversely affect such rights, preferences and privileges.

        Section 7.     Redemption.

                    (a)     On the fifth anniversary of the date that the Series A Redeemable Preferred Stock was issued (the "Mandatory Redemption Date"), the Company shall redeem from any source of funds legally available therefore, in the manner provided herein, all of the shares of Series A Redeemable Preferred Stock then outstanding, at a cash price per share equal to 100% of the Preferred Liquidation Value plus an amount equal to all Preferred Dividends (whether or not earned or declared) accrued and unpaid on each such share up to and including the date fixed for redemption (the "Redemption Price"), in immediately available funds. Any such redemption shall be conducted in accordance with Section 7(c) below.

                    (b)     The Company shall have the right, at any time and from time to time, on and after the date of issuance, and at its sole option and election, to redeem the shares of Series A Redeemable Preferred Stock, in whole or in part, at the Redemption Price. Any such redemption shall be conducted in accordance with Section 7(c). If less than all the outstanding shares of Series A Redeemable Preferred Stock are to be redeemed, the number of shares of Series A Redeemable Preferred Stock to be redeemed shall be as determined by the Board of Directors. Any such partial redemption shall be effected on a pro rata basis.

                    (c)     The Company shall provide each holder of Series A Redeemable Preferred Stock with a written notice of redemption (addressed to the holder at its address as it appears on the stock transfer books of the Company), not earlier than sixty (60) nor later than twenty (20) days before the date fixed for redemption. The notice of redemption shall specify (i) the date fixed for redemption (the "Redemption Date"); (ii) whether all or less than all of the outstanding shares of Series A Redeemable Preferred Stock are to be redeemed and the total number of shares of the Series A Redeemable Preferred Stock to be redeemed; (iii) the amount of the Redemption Price; (iv) whether the redemption is an optional redemption or a mandatory redemption; and (v) that the holder's are to surrender to the Company, at the place or places the holders of Series A Redeemable Preferred Stock may obtain payment of the Redemption Price, their certificates in the manner designated. If funds are available on the date fixed for redemption, then whether or not shares are surrendered for payment of the Redemption Price, the shares of Series A Redeemable Preferred Stock shall no longer be outstanding and the holders thereof shall cease to be Series A Redeemable Preferred Stock holders of the Company with respect to the shares redeemed on and after the date fixed for redemption and shall be entitled to receive the Redemption Price, without interest, upon the surrender of the share certificate. On or before the applicable Redemption Date, each holder of shares of Series A Redeemable Preferred Stock to be redeemed on such Redemption Date shall surrender the certificate or certificates representing such shares to the Company, duly endorsed, in the manner and at the place designated in the Redemption Notice and there upon the Redemption Price for such shares shall be payable in cash to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered certificate shall be cancelled and retired. In the event less than all of the shares of Series A Redeemable Preferred Stock represented by a certificate are redeemed, a new certificate representing the unredeemed shares of Series A Redeemable Preferred Stock shall be issued forthwith. Failure to mail the notice described in the first sentence of this Section 7(c), or any defect therein or in the mailing thereof, to any particular holder shall not affect the validity of the proceeding for the redemption of any shares so to be redeemed from any other holder. In order to facilitate the redemption of shares of Series A Redeemable Preferred Stock, the Board of Directors may fix a record date for the determination of shares of Series A Redeemable Preferred Stock to be redeemed, or may cause the transfer books of the Company for the Series A Redeemable Preferred Stock to be closed, not more than sixty (60) days or less than twenty (20) days prior to the applicable Redemption Date.

                    (d)     Notice of redemption having been given as provided in Section 7(c) above, notwithstanding that any certificates for such shares shall not have been surrendered for cancellation, unless the Company defaults in the payment in full of the applicable redemption price, from and after the Redemption Date designated in the notice of redemption (i) the shares represented thereby shall no longer be deemed outstanding, (ii) the rights to receive dividends thereon shall cease to accrue and (iii) all rights of the holders of shares of Series A Redeemable Preferred Stock to be redeemed shall cease and terminate, excepting only the right to receive the Redemption Price therefor.

                    (e)     The Company shall not be required to establish any sinking or retirement fund with respect to the shares of Series A Redeemable Preferred Stock.

        Section 8.     Change of Control Redemption.

                    (a)     Upon the occurrence of a Change of Control (as defined below) each holder of Series A Redeemable Preferred Stock shall have the right to require the Company to redeem such Series A Redeemable Preferred Stock, in cash at a price per share equal to 101% of the Preferred Liquidation Value plus an amount equal to all Preferred Dividends (whether or not earned or declared) accrued and unpaid on each such share up to and including the date fixed for redemption. Any such redemption shall be conducted in accordance with Section 7(c). For purposes of this Section 8, "Change of Control" means the occurrence of any of the following events:

        (i)     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 any stockholder that owns individually, or with its affiliates, in excess of 25% of the voting power of all classes of voting stock of the Company on the initial date of issuance of the Series A Preferred Stock, becomes the "beneficial owner" (as defined in Rules 13d-3 under the Exchange Act, except that a person or entity shall be deemed to have "beneficial ownership" of all securities that such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than a majority of the voting power of all classes of voting stock of the Company;

        (ii)     the direct or indirect sale, lease, exchange or other transfer of all or substantially all of the assets of the Company to any "person" or "group" (within the meaning of Section 13(d) or 14(d) of the Exchange Act), other than a subsidiary or other affiliate of the Company;

        (iii)     the consummation of any consolidation or merger of the Company with or into another entity with the effect that the stockholders of the Company as of the date of issuance of the Series A Redeemable Preferred Stock hold less than 51% of the combined voting power of the outstanding voting securities of the surviving entity of such merger or the entity resulting from such consolidation ordinarily having the right to vote in the election of directors immediately after such merger or consolidation;

        (iv)     during any consecutive two-year period, individuals who at the beginning of such period constituted the Board of Directors of the Company (together with any new directors whose election to such Board of Directors, or whose nomination for election by the stockholders of the Company, was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of the Company then in office; or

        (v)     the Company is liquidated or dissolved or adopts a plan of liquidation or dissolution.     

                    (b)     The Company shall provide each holder of Series A Redeemable Preferred Stock with a written notice of the occurrence of a Change of Control (addressed to the holder at its address as it appears on the stock transfer books of the Company), not earlier than sixty (60) nor later than twenty (20) days before the date of such occurrence. Such notice shall specify the date for redemption payments to be made, which shall be a date not later than the date of the occurrence of the Change of Control.

        Section 9.     Failure to Redeem.     If the Company is unable or shall fail to discharge its obligation to redeem all outstanding shares of Series A Redeemable Preferred Stock pursuant to Section 7(a) or 8(a) (each, a "Mandatory Redemption Obligation"), such Mandatory Redemption Obligation shall be discharged as soon as the Company is able to discharge such Mandatory Redemption Obligation. The shares of Series A Redeemable Preferred Stock not redeemed shall remain outstanding and entitled to all the rights and preferences provided herein. If and so long as any Mandatory Redemption Obligation with respect to the Series A Redeemable Preferred Stock shall not be fully discharged, the Company shall not declare or make any dividend or other distribution or, directly or indirectly, redeem, purchase, or otherwise acquire for any consideration any other series or class or classes of stock to which the Series A Redeemable Preferred Stock ranks equal or prior as to dividends or liquidation or discharge any mandatory or optional redemption, sinking fund or other similar obligation in respect of any such securities (except in connection with a redemption, sinking fund or other similar obligation to be satisfied pro rata with the Series A Redeemable Preferred Stock).

        Section 10.     Reacquired Shares.     Any shares of Series A Redeemable Preferred Stock converted, exchanged, redeemed, purchased or otherwise acquired by the Company in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock without designation as to series and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors as permitted by the Certificate of Incorporation or as otherwise permitted under Delaware law.

        Section 11.     Preemptive Rights.     The Series A Redeemable Preferred Stock is not entitled to any preemptive rights in respect of any securities of the Company.

        Section 12.     Severability of Provisions.     Whenever possible, each provision hereof shall be interpreted in a manner as to be effective and valid under applicable law, but if any provision hereof is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining provisions hereof. If a court of competent jurisdiction should determine that a provision hereof would be valid or enforceable if a period of time were extended or shortened or a particular percentage were increased or decreased, then such court may make such change as shall be necessary to render the provision in question effective and valid under applicable law.

        Section 13.     Replacement.     Upon receipt of evidence satisfactory to the Company (an affidavit of the registered holder shall be satisfactory) of the ownership and the loss, theft, destruction or mutilation of any certificate evidencing shares of Series A Redeemable Preferred Stock, and, in the case of any such loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to the Company (provided, that, if the holder is a financial institution or other institutional investor, its own agreement shall be satisfactory), or, in the case of any such mutilation, upon surrender of such certificate, the Company shall execute and deliver in lieu of such certificate a new certificate of like kind representing the number of shares of Series A Redeemable Preferred Stock of such class represented by such lost, stolen, destroyed or mutilated certificate and dated the date of the lost, stolen, destroyed or mutilated certificate, and dividends shall accrue on the Series A Redeemable Preferred Stock represented by such new certificate from the date to which dividends have been fully paid on the Series A Redeemable Preferred Stock represented by the lost, stolen, destroyed or mutilated certificate.

        Section 14.     Successors and Transferees.     The provisions applicable to shares of Series A Redeemable Preferred Stock shall bind and inure to the benefit of and be enforceable by the Company, the respective successors to the Company, and by any record holder of shares of Series A Redeemable Preferred Stock.

        IN WITNESS WHEREOF, Ascent Energy Inc. has caused this Certificate of Designations to be signed by the undersigned on this __ day of __________, 2001.

ASCENT ENERGY INC.

By:___________________________
                     Jeffrey Clarke
                         President

EX-4.2

Exhibit 4.2

Number
- -  Shares
 - -

ASCENT ENERGY INC.
ORGANIZED UNDER THE LAWS OF THE STATE OF DELAWARE
8% SERIES A REDEEMABLE PREFERRED STOCK

This Certifies That _________________________ is the registered holder of________________ shares of 8% Series A Redeemable Preferred Stock, $0.001 par value, of the above Corporation, which are fully paid and non-assessable and transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this Certificate properly endorsed.

In Witness Whereof, the said Corporation has caused this Certificate to be signed by its duly authorized officers and its Seal to be hereunto affixed this ____ day of __________, ______.

                                     _______________________         _______________________
                                                       President                                            Secretary

PREFERRED

$0.001
par value

STOCK CERTIFICATE

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED.

ANY STOCKHOLDER MAY OBTAIN WITHOUT CHARGE, BY REQUEST TO THE OFFICE OF THE SECRETARY OF THE COMPANY, A COPY OF A STATEMENT OF THE RIGHTS, PREFERENCES, PRIVILEGES AND RESTRICTIONS GRANTED TO OR IMPOSED UPON THE SHARES OF SERIES A PREFERRED STOCK REPRESENTED HEREBY AND OF EACH OTHER CLASS OR SERIES OF SHARES AUTHORIZED TO BE ISSUED BY THE COMPANY AND UPON THE HOLDERS THEREOF.

No. - -

Ascent Energy Inc.

CERTIFICATE
FOR

- -

SHARES

OF

Series A Redeemable
Preferred Stock

ISSUED TO

_____________________

DATED

__________, _____

        For value received, ______________________ hereby sells, assigns and transfers unto _______________________________ Shares of the Preferred Stock represented by the within Certificate, and do hereby irrevocably constitute and appoint ______________________ Attorney to transfer the said Stock on the books of and within named Corporation with full power of substitution in the premises.

Dated: ________________________

In presence of: __________________

NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.

EX-4.4

Exhibit 4.4

Number
- - Shares
- -

ASCENT ENERGY INC.
ORGANIZED UNDER THE LAWS OF THE STATE OF DELAWARE
8% SERIES B CONVERTIBLE PREFERRED STOCK

This Certifies That _________________________ is the registered holder of________________ shares of 8% Series B Convertible Preferred Stock, $0.001 par value, of the above Corporation, which are fully paid and non-assessable and transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this Certificate properly endorsed.

In Witness Whereof, the said Corporation has caused this Certificate to be signed by its duly authorized officers and its Seal to be hereunto affixed this ____ day of __________, _____.

                                     _______________________         _______________________
                                                       President                                            Secretary

PREFERRED

$0.001
par value

STOCK CERTIFICATE

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED.

ANY STOCKHOLDER MAY OBTAIN WITHOUT CHARGE, BY REQUEST TO THE OFFICE OF THE SECRETARY OF THE COMPANY, A COPY OF A STATEMENT OF THE RIGHTS, PREFERENCES, PRIVILEGES AND RESTRICTIONS GRANTED TO OR IMPOSED UPON THE SHARES OF SERIES B PREFERRED STOCK REPRESENTED HEREBY AND OF EACH OTHER CLASS OR SERIES OF SHARES AUTHORIZED TO BE ISSUED BY THE COMPANY AND UPON THE HOLDERS THEREOF.

No. - -

Ascent Energy Inc.

CERTIFICATE
FOR

- -

SHARES

OF

Series B Convertible
Preferred Stock

ISSUED TO

_____________________

DATED

________, ____

        For value received, ______________________ hereby sells, assigns and transfers unto _______________________________ Shares of the Preferred Stock represented by the within Certificate, and do hereby irrevocably constitute and appoint ______________________ Attorney to transfer the said Stock on the books of and within named Corporation with full power of substitution in the premises.

Dated: ________________________

In presence of: __________________

NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.

EX-4.5

Exhibit 4.5

Warrant No. _____                                                                                                          Warrants to Purchase

______________
shares of Common Stock

                       THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THE SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED.

WARRANT

To Purchase Common Stock of

ASCENT ENERGY INC.

THIS WARRANT CERTIFICATE certifies that _______________ (the "Holder"), or registered assigns, is entitled to purchase from Ascent Energy Inc., a Delaware corporation (the "Company"), at any time during the period commencing on the date hereof, but not later than 5:00 p.m., Central time, on June 1, 2011 (the "Expiration Date"), that number of fully paid and non–assessable shares of Common Stock (each, a "Warrant Share"), $0.001 par value per share (the "Common Stock"), as set forth above at an exercise price of $__________ (the "Exercise Price") per Warrant Share, all on the terms and conditions hereinbelow provided. The number of Warrant Shares issuable upon exercise of the Warrant and the Exercise Price are subject to adjustment on the occurrence of certain events set forth below.

            Section 1.      Exercise of Warrant.

                        (a)     The holder of this Warrant may, at any time on and after the date hereof, but not later than the Expiration Date, exercise this Warrant in whole at any time or in part from time to time for the number of Warrant Shares which the Holder is then entitled to purchase hereunder. The Holder may exercise this Warrant, in whole or in part, by either of the following methods:

                                 (i)     The Holder may deliver to the Company (A) a written notice of the Holder's election to exercise this Warrant, which notice shall specify the number of Warrant Shares to be purchased, (B) this Warrant and (C) a sum equal to the aggregate Exercise Price for the number of Warrant Shares being purchased in immediately available funds; or

                                (ii)      If the Common Stock is then traded on a national securities exchange or quoted on the Nasdaq Stock Market or any other over–the–counter securities market, the Holder may also exercise this Warrant, in whole or in part, in a "cashless" or "net–issue" exercise by delivering to the Company (A) a written notice of the Holder's election to exercise this Warrant, which notice shall specify the number of Warrant Shares to be purchased and the number of Warrant Shares with respect to which this Warrant is being surrendered in payment of the aggregate Exercise Price for the Warrant Shares to be purchased by the Holder, and (B) this Warrant. For purposes of this Section 1(a)(ii), each Warrant Share as to which this Warrant is surrendered will be attributed a value equal to the average of the difference between the daily last sales price reported on the primary national securities exchange, Nasdaq Stock Market or over–the–counter market on which the Common Stock is then previously traded or quoted for 20 Business Days preceding and the Exercise Price for each such Warrant.

                        (c)      Any notice required under this Section 1 may be given by delivering this Warrant together with an executed copy of the Subscription Form set out at the end of this Warrant. Upon delivery thereof, the Company shall as promptly as practicable and in any event within ten calendar days thereafter, cause to be executed and delivered to the Holder a certificate or certificates representing the aggregate number of fully–paid and nonassessable shares of Common Stock issuable upon such exercise. The stock certificate or certificates for Warrant Shares so delivered shall be in such denominations as may be specified in said notice and shall be registered in the name of the Holder or, subject to Section 1(b), such other name or names as shall be designated in said notice. If this Warrant shall have been exercised only in part, the Company shall, at the time of delivery of said certificate or certificates, deliver to the Holder a new Warrant dated the date it is issued, evidencing the rights of the Holder to purchase the remaining Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical to this Warrant, or, at the request of the Holder, appropriate notation may be made on this Warrant and the Warrant shall be returned to the Holder.

                        (d)      The Company shall pay all expenses, taxes and other charges payable in connection with the preparation, issue and delivery of stock certificates under this Section 1.

                        (e)      All shares of Common Stock issuable upon the exercise of this Warrant shall be validly issued, fully paid and nonassessable, and free from all liens created by the Company and other encumbrances thereon.

                        (f)      Except as may otherwise be required by law, the Company will not close its books against the transfer of this Warrant in any manner which interferes with the timely exercise of this Warrant.

            Section 2.     Transfer, Division and Combination.

                        (a)      Subject to Section 6, this Warrant and all rights hereunder are transferable, in whole or in part, on the books of the Company to be maintained for such purpose, upon surrender of this Warrant, together with a written assignment in the form set out at the end of this Warrant duly executed by the Holder or its agent or attorney and payment of funds sufficient to pay any stock transfer taxes payable upon the making of such transfer. Upon such surrender and payment the Company shall, subject to Section 6, execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denominations specified in such instrument of assignment, and this Warrant shall promptly be canceled.

                        (b)      The Company shall pay all expenses, taxes and other charges incurred by the Company in the performance of its obligations in connection with the preparation, issue and delivery of Warrants under this Section 2.

            Section 3.     Adjustment of Stock Unit or Exercise Price. The Exercise Price and the number of Warrant Shares purchasable upon the exercise of this Warrant are subject to adjustment from time to time upon the occurrence of the events specified in this Section 3.

                        (a)      If the Company shall (i) pay a stock dividend on its capital stock, (ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into smaller number of shares of Common Stock or (iv) issue any shares of its capital stock in a reclassification of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), the number of Warrant Shares purchasable upon exercise of this Warrant immediately prior thereto shall be adjusted so that the Holder shall be entitled to receive the kind and number of Warrant Shares or other securities of the Company which the Holder would have owned or have been entitled to receive after the happening of any of the events described above, had such Warrant been exercised immediately prior to the happening of such event or any record date with respect thereto.

                        (b)      In the event of any capital reorganization or any reclassification of the Common Stock (except as provided in Section 3(a) above or (g)) the Holder upon exercise thereof shall be entitled to receive, in lieu of the Common Stock to which he would have become entitled upon exercise immediately prior such reorganization or reclassification, the shares (of any class or classes) or other securities or property of the Company that he would have been entitled to receive at the same aggregate Exercise Price upon such reorganization or reclassification if this Warrant had been exercised immediately prior thereto; and in any such case, appropriate provision (as determined in good faith by the Board of Directors of the Company, whose determination shall be conclusive) shall be made for the application of this Section 3 with respect to the rights and interests thereafter of the Holder (including the allocation of the adjusted Exercise Price between or among shares of classes of capital stock), to the end that this Section 3 (including the adjustments of the number of shares of Common Stock or other securities purchasable and the Exercise Price thereof) shall thereafter be reflected, as nearly as reasonably practicable, in all subsequent exercises of this Warrant for any shares or securities or other property thereafter deliverable upon the exercise of this Warrant.

                        (c)      Except for adjustments required by Section 3, no adjustment in the number of Warrant Shares purchasable hereunder shall be required unless such adjustment would require an increase or decrease of at least one percent (1%) in the number of Warrant Shares purchasable upon the exercise of this Warrant; provided, however, that any adjustments which by reason of this Section 3(c) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations shall be made to the nearest cent and to the nearest one–hundredth of a Warrant Share, as the case may be.

                        (d)      Whenever the number of Warrant Shares purchasable upon the exercise of this Warrant is adjusted as herein provided (whether or not the Company then or thereafter elects to issue additional Warrants in substitution for an adjustment in the number of Shares as provided in Section 3(g)), the Exercise Price payable upon exercise of this Warrant shall be adjusted by multiplying the Exercise Price immediately prior to such adjustment by a fraction, of which the numerator shall be the number of Warrant Shares purchasable upon the exercise of this Warrant immediately prior to such adjustment, and of which the denominator shall be the number of Warrant Shares so purchasable immediately thereafter.

                        (e)      For the purpose of this Section 3, the term "shares of stock" shall mean (i) the class of stock designated as the Common Stock of the Company at the date of this Agreement, or (ii) any other class of stock resulting from successive changes or reclassification of such shares consisting solely of changes in par value, or from par value to no par value, or from no par value to par value. If at any time, as a result of an adjustment made pursuant to Section 3(a) or (b), the Holder shall become entitled to purchase any shares of the Company other than Warrant Shares, thereafter the number of such other shares so purchasable upon exercise of this Warrant and the Exercise Price of such shares so purchasable upon exercise of this Warrant shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions contained in Sections 3(a) through (d), which provisions shall apply on like terms to any such other shares.

                        (f)      Except as provided in this Section 3, no adjustment in respect of any dividends shall be made during the term of a Warrant or upon the exercise of a Warrant.

                        (g)      In case of any consolidation of the Company with or merger of the Company into another corporation or other entity or in case of any sale or conveyance to another person of the property of the Company as an entirety or substantially as an entirety, the Company or such successor or purchasing corporation or other entity, as the case may be, shall execute and deliver to the Holder an agreement that the Holder shall have the right thereafter upon payment of the Exercise Price in effect immediately prior to such action to purchase upon exercise of the each Warrant the kind and amount of shares and other securities and property which he would have owned or have been entitled to receive after the happening of such consolidation, merger, sale or conveyance had the Warrant been exercised immediately prior to such action. The Company shall promptly provide to Holder notice of the execution of any such agreement. Such agreement shall provide for adjustments, which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 3. The provisions of this Section 3(g) shall similarly apply to successive consolidations, mergers, sales or conveyances.

            Section 4.     Notices.

                        (a)      Upon any adjustment of the number of shares purchasable upon exercise of this Warrant or the Exercise Price, the Company within 20 calendar days thereafter shall cause to be mailed to the Holder a certificate setting forth the Exercise Price and either the number of Warrant Shares purchasable upon exercise of each Warrant or the replacement warrant to be issued for this Warrant, as the case may be, after such adjustment and setting forth in reasonable detail the method of calculation and the facts upon which such adjustment was made, which certificate shall be conclusive evidence of the correctness of the matters set forth therein.

                        (b) If:

                                 (i)     the Company shall declare any dividend payable in any securities upon its Common Stock or make any distribution (other than a cash dividend) to the holders of its shares of Common Stock, or

                                 (ii)     the Company shall offer to the holders of its shares of Common Stock any additional shares of Common Stock or securities convertible into shares of Common Stock or any right to subscribe thereto, or

                                 (iii)     there shall be a dissolution, liquidation or winding up of the Company (other than in connection with a consolidation, merger or sale of all or substantially all of its property, assets and business as an entirety),

the Company shall cause written notice of such event to be given to the Holder at least ten calendar days (or 20 calendar days in any case specified in Section 4(b)(iii)) prior to the date fixed as a record date for the date of closing the transfer books for the determination of the stockholders entitled to such dividend, distribution or subscription rights, or for the determination of stockholders entitled to vote on such proposed dissolution, liquidation or winding up. Such notice shall specify such record date or the date of closing the transfer books, as the case may be. The failure to give the notice required by this Section 4 or any defect therein shall not affect the legality or validity of any distribution, right, warrant, dissolution, liquidation or winding up or the vote upon or any other action taken in connection therewith.

            Section 5.     Restrictions on Transfer.

                        (a)      The Holder by its acceptance of this Warrant understands and agrees that this Warrant and the Warrant Shares have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities saws, and that accordingly, they will not be fully transferable except as permitted under various exemptions contained in the Securities Act and applicable state securities laws, or upon satisfaction of the registration and prospectus delivery requirements of the Securities Act and applicable state and securities laws. The Holder acknowledges that it must bear the economic risk of its investment in the Warrant and Warrant Shares for an indefinite period of time since they have not been registered under the Securities Act and applicable state securities laws and therefore cannot be sold unless they are subsequently registered or an exemption from registration is available.

                        (b)      The Holder agrees that without the prior written consent of the Company, which may be withheld by the Company in its sole discretion, it shall not transfer the Warrant or any interest therein to anyone other than a member of its Group. For purposes of this Section 5, a "Group" shall mean:

                                 (i)     if the Holder is an individual, the Holder, the spouse, lineal descendants and adopted children of the Holder and any trust for the benefit of any of the foregoing; and

                                 (ii)     if the Holder is a corporation, limited liability company or partnership, (A) such corporation, limited liability company or partnership, (B) any corporation or other business organization to which such corporation, limited liability company or partnership shall sell, license or transfer all or substantially all of its assets or with which it shall be merged, (C) with respect to any limited liability company or partnership, any partner (general or limited) or member thereof and (D) any affiliate of such corporation, limited liability company or partnership.

        The Company shall from time to time, subject to the limitations of this Section 5, register the permitted transfer of this Warrant upon the records to be maintained by it for that purpose, upon surrender thereof duly endorsed or accompanied (if so required by it) by a written instrument or instruments of transfer in form satisfactory to the Company, duly executed by the registered holder or holders thereof or by the duly appointed legal representative thereof or by a duly authorized attorney. Upon any such registration of transfer, a replacement warrant shall be issued to the transferee(s) and the surrendered Warrant shall be cancelled by the Company.

        The Holder agrees that prior to any proposed transfer of the Warrant the Holder will deliver to the Company:

                                 (i)    an agreement by such transferee to the impression of the restrictive legend set forth in Section 5(d) on the Warrant; and 

                                 (ii)    an agreement by such transferee be bound by the provisions of this Warrant.

                        (d)      The Holder agrees that the Warrant will bear a legend in substantially the following form:

                        "THE SECURITIS EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS TH SAME ARE REGISTERED AND QUALIFIED IN ACCORDANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY SUCH REGISTRATION AND QUALIFICATION ARE NOT SO REQUIRED."

                        (e)      Subject to the terms of this Warrant, this Warrant may be exchanged at the option of the Holder, when surrendered to the Company at its principal office, which is currently located at the address listed in Section 9, for another Warrant of like tenor and representing in the aggregate a like number of Warrant Shares. If the Holder desires to exchange this Warrant it shall deliver a written request to the Company, and shall surrender, duly endorsed or accompanied (if so required by the Company) by a written instrument or instruments of transfer form satisfactory to the Company, the Warrant Certificate or Certificates to be so exchanged.

            Section 6.     Limitation of Liability. No provision hereof, in the absence of affirmative action by the Holder to purchase shares of Common Stock, and no mere enumeration herein of the rights or privileges of the holder hereof, shall give rise to any liability of the Holder for the purchase price of the Warrant Shares or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

            Section 7.     Loss or Destruction of Warrant. Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon receipt of indemnity or security satisfactory to the Company or, in the case of any such mutilation, upon surrender and cancellation of this Warrant, the Company will make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the right to purchase the same aggregate number of shares of Common Stock.

            Section 8.     Amendments. The terms of this Warrant may be amended, and the observance of any term therein may be waived, but only with the written consent of the Company and the Holder.

            Section 9.     Notices Generally. All communications (including all required or permitted notices) pursuant to the provisions hereof shall be in writing and shall be sent,

                        (a)      if to the Holder at its address for notices specified beneath its name on the signature page hereof or at such other address as it may have furnished in writing to the Company.

    (b)     if to the Company:

                                Ascent Energy Inc.
                                650 Poydras Street, Suite 2200
                                New Orleans, Louisiana 70130
                                Attn: President

                                or at such other address as it may have furnished in writing to the Holder.

        Any notice or demand authorized by this Warrant to be given or made by the Holder of or on the Company or by the Company to the Holder shall be sufficiently given or made when and if deposited in the mail, first class or registered, postage prepaid, addressed (until another address is provided in writing) as provided in this Section 9.

                        Section 10. GOVERNING LAW. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.

                        IN WITNESS WHEREOF, the Company has caused this Warrant to be signed in its name by its President or a Vice President and its corporate seal to be impressed hereon and attested by its Secretary or an Assistant Secretary.

Dated: _______________, 2001

                                                                                 ASCENT ENERGY INC. 

                                                                                 By:                                                                 
                                                                                    Name:
                                                                                    Title:

ATTEST:

                                                              
Name:
Title:

Address for Notices 

__________________________

__________________________

__________________________

SUBSCRIPTION FORM 

(to be executed only upon exercise of Warrant) 

                                The undersigned registered owner of this Warrant irrevocably exercises this Warrant for and purchases Warrant Shares of Ascent Energy Inc., a Delaware corporation, purchasable with this Warrant, and herewith makes payment therefor (by check in the amount of $_____), or hereby tenders _____ Warrant Shares as payment therefor, all at the price and on the terms and conditions specified in this Warrant and requests that certificates for the shares of Common Stock hereby purchased (and any securities or other property issuable upon such exercise) be issued in the name of and delivered to ______________ whose address is _____________ and, if such Warrant Shares shall not include all of the Warrant Shares issuable as provided in this Warrant that a new Warrant of like tenor and date for the balance of the Warrant Shares issuable thereunder be delivered to the undersigned.

Dated:

_________________________________
(Signature of Registered Owner)

__________________________________
(Street Address)

__________________________________
(City)         (State) (Zip Code)

ASSIGNMENT FORM

                        FOR VALUE RECEIVED the undersigned registered owner of this Warrant hereby sells, assigns and transfers unto the Assignee named below all of the rights of the undersigned under this Warrant, with respect to the number of Warrant Shares set forth below:

No. of Warrant Shares                                                  Name and Address of Assignee

and does hereby irrevocably constitute and appoint _____ Attorney to make sure transfer on the books of Ascent Energy Inc., a Delaware corporation, maintained for the purpose, with full power of substitution in the premises.

Dated:

______________________________
Signature

______________________________
Witness

NOTICE:	The signature to the assignment must correspond with the name as written upon the face of the within Warrant in every particular, without alteration or enlargement or any change whatever.
	The signature must be guaranteed by an institution which is a member of one of the following recognized signature guarantee programs:
	(1)     The Securities Transfer Agents Medallion Program (STAMP);
	(2)     The New York Stock Exchange Medallion Stamp Program (MSP);
	(3)     The Stock Exchange Medallion Program (SEMP).

EX-5

Exhibit 5

March 27, 2001

Ascent Energy Inc.
650 Poydras St.
Suite 2200
New Orleans, Louisiana 70130

        Re:     Ascent Energy Inc.
                  Registration Statement on Form S–4

Gentlemen:

        We have acted as counsel to Ascent Energy Inc. (the "Company") in connection with the preparation of the registration statement on Form S–4 (the "Registration Statement") filed by the Company with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"). All terms used without other definitions are intended to have the meanings given to them in the Registration Statement.

        Pursuant to the Agreement and Plan of Merger (the "Merger Agreement"), dated as of January 19, 2001, among the Company, Pontotoc Acquisition Corp., a wholly owned subsidiary of the Company (the "Merger Sub"), and Pontotoc Production, Inc. ("Pontotoc"), the Company, through the Merger Sub, has offered to exchange (the "Exchange Offer") its shares of 8% Series B Convertible Preferred Stock, par value $0.001 per share (the "Preferred Stock"), and cash for each outstanding share of Pontotoc common stock tendered in the Exchange Offer. Following consummation of the Exchange Offer, the Company intends to cause the Merger Sub to merge with Pontotoc. Each share of Pontotoc common stock that is not exchanged or accepted in the Exchange Offer will be converted in the merger into the right to receive the same per share consideration as is being paid in the Exchange Offer. The Registration Statement relates to the registration of the Preferred Stock and an indeterminable number of shares of common stock that may be issued upon the conversion of the Preferred Stock (the "Common Stock" and, together, with the Preferred Stock, the "Shares").

        In rendering the opinions expressed below, we have examined originals, or photostatic or certified copies, of such records and documents of the Company, certificates of officers of the Company and of public officials, and such other documents as we have deemed necessary or advisable for purposes of rendering this opinion. In such examination, we have assumed the genuineness of all signatures, the legal capacity of all individuals who have executed any documents reviewed by us, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified or photostatic copies and the authenticity of the originals of such documents.

        Based upon the foregoing, and subject to the qualifications stated herein, we are of the opinion that:

1.     The Preferred Stock will be validly issued, fully paid and non–assessable when issued upon consummation of the Exchange Offer and the subsequent merger in accordance with the terms of the Merger Agreement.

2.     The issuance of shares of Common Stock, into which the shares of Preferred Stock may be converted, are duly authorized and, when issued in accordance with the Company's certificate of incorporation and certificate of designations, will be validly issued and outstanding, fully paid and non–assessable.

        In connection with our opinions expressed above, we have assumed that, at or prior to the time of the delivery of any such Shares: (i) the Registration Statement shall have been declared effective and such effectiveness shall not have been terminated or rescinded; and (ii) there will not have occurred any change in law affecting the validity of such Shares.

        The foregoing opinion is limited in all respects to the laws of the States of Delaware and Louisiana and federal laws, and we are expressing no opinion as to the effect of the laws of any other jurisdiction, domestic or foreign.

        We consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to us in the prospectus included therein under the caption "Legal Matters." In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Act, or the general rules and regulations of the Commission promulgated thereunder.

                                                                              Very truly yours,

                                                                             /s/ Jones, Walker, Waechter, Poitevent,
                                                                                 Carrere & Denegre, L.L.P.

                                                                             JONES, WALKER, WAECHTER, POITEVENT,
                                                                             CARRÈRE & DENÈGRE, L.L.P.

EX-10.1

Exhibit 10.1

STOCKHOLDERS' AGREEMENT 

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

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

          NOW, THEREFORE, the parties hereto agree as follows: 

ARTICLE 1
VOTING AGREEMENT; AGREEMENT TO TENDER 

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

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

ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER

          Each Stockholder, severally and not jointly, represents and warrants to Buyer that:        

          Section 2.1.     Authorization. The execution, delivery and performance by such Stockholder of this Agreement and the consummation by such Stockholder of the transactions contemplated hereby are within the powers of such Stockholder and have been duly authorized by all necessary action. This Agreement constitutes a valid and binding Agreement of such Stockholder.

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

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

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER 

          Buyer represents and warrants to each Stockholder:

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

ARTICLE 4
COVENANTS OF STOCKHOLDER

          Each Stockholder hereby covenants and agrees that:

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

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

ARTICLE 5
MISCELLANEOUS

          Section 5.1.     Further Assurances. Buyer and each Stockholder will each execute and deliver, or cause to be executed and delivered, all further documents and instruments and use all reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations, to consummate and make effective the transactions contemplated by this Agreement.

           Section 5.2.     Amendments; Termination. Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed, in the case of an amendment, by each party to this Agreement or in the case of a waiver, by the party against whom the waiver is to be effective. This Agreement shall terminate upon the termination of the Merger Agreement in accordance with its terms.

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

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

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

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

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

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

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

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

BUYER:

ASCENT ENERGY INC.

By:             /s/ Jeffrey Clarke                    
                    Jeff Clarke
                    President

STOCKHOLDERS:                                                                                           Shares of common
                                                                                                                              stock of the Company
                                                                                                                              owned by Stockholder:

                /s/ James Robson, Jr.                                                                                         569,497
James "Robby" Robson, Jr.

               /s/ Todd Robson                                                                                                 570,051
Todd Robson

            /s/ James Robson, Sr.                                                                                             441,313
James Robson, Sr.

          /s/ Lyle P. Phillips                                                                                                     299,000
Lyle P. Phillips

          /s/ Brian K. Gourley                                                                                                   58,671
Brian K. Gourley

         /s/ Timothy A. Jurek                                                                                                   25,000
Timothy A. Jurek

EX-10.2

Exhibit 10.2

LEASE AGREEMENT

By and Between

PONTOTOC GATHERING, L.L.C.

"Lessee"

AND

ENERFIN RESOURCES I LIMITED PARTNERSHIP

"Lessor"

DATED: July 1, 2000

LEASE AGREEMENT

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

SECTION 1. RECITALS

1.1	PGL is in partnership with Pontotoc Production Company, ("PPC") and PPC plans to   develop natural gas from shallow reservoirs in northern Pontotoc, southern Seminole and southeastern Potawatomie Counties, Oklahoma; and,
1.2	Enerfin owns and operates a natural gas pipeline gathering system, the ("Byng") System which is more fully described in Exhibit "A" attached hereto and made a part hereof; and,
1.3	The Byng System is located in the vicinity in which PPC plans to develop natural gas production; and,
1.4	PGL, as Lessee, and Enerfin, as Lessor, desire to enter into a Lease Agreement under the terms and conditions provided herein.

SECTION 2. SCOPE AND USAGE

2.1

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

2.2

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

SECTION 3. OPERATIONS

3.1	Lessee shall assume on the effective date of this Agreement, at its sole risk and expense, the operations of the Byng System in a manner consistent with prudent operating procedures and in accordance with generally accepted industry standards, laws and regulations. Lessee shall operate the Byng System in Low Pressure natural gas service. For purposes of this Agreement, Low Pressure is defined as that pressure at which a pipeline may be operated at under safe operating conditions, but which pressure in no event will exceed the maximum allowable operating pressure ("MAOP") of such pipeline. Notwithstanding the foregoing, Lessee will not allow the operating pressure of any of the pipelines of the Byng System to exceed 250 psig.
3.2	Lessee will perform, at its sole risk and expense, all necessary or appropriate activities concerning the operation, inspection, maintenance, corrosion prevention (including maintaining rectifiers for cathodic protection) and repairs of the Byng System. All such repairs, maintenance, upgrades or improvements performed on the Byng System by Lessee shall remain the property of Lessor.
3.3	Lessee shall comply, at its sole risk and expense, with all of the terms and conditions of the Easements covering the Byng System. Lessor shall provide Lessee with a copy of the Easements of the Byng System and Lessee shall maintain files relative to these Easements during the term of this Agreement including amendments, correspondence and related information and documents. These Easement files shall remain the property of Lessor and upon termination of this Agreement, Lessee shall turn such files and documents over to Lessor.
3.4	Lessee shall be responsible, at its sole risk and expense, for line locates and for complying with the requirements of the "Okie 1–Call" system (or other similar applicable programs) with respect to the Byng System during the term of this Agreement. Prior to commencing operation of any pipeline segment(s) of the Byng System for natural gas service as contemplated herein, Lessee shall install appropriate line markers in Lessee's name upon such pipeline segment(s) that Lessee places in natural gas service.
3.5	Lessee will be responsible, at its sole risk and expense, for procuring any necessary governmental operating or right–of–way permits, documents, approvals, or authorities relating to the use, operation, maintenance, or shutdown of the Byng System.
3.6	Lessee understands that the property leased pursuant to this Agreement does not include compressors, pumps, meters, and/or other equipment which may be necessary in the course of Lessee's operation and use of such property. Lessee will furnish and install, at its sole risk and expense, any equipment or facilities required in the conduct of Lessee's permitted operations of the property. Any equipment or facilities so installed shall meet the operating requirements previously outlined in this Agreement and shall remain the property of Lessee.

SECTION 4.

ALTERATIONS, CONSTRUCTION AND SURRENDER OF THE BYNG SYSTEM

4.1

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

4.2

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

SECTION 5. LEASE RENTAL FEES

5.1	Lessee agrees to pay to Lessor each month as rental for the Byng System, a monthly Lease Rental Fee that shall be the greater of: (i.) Four Percent (4%) of the Gross Sales Revenue for the sale of natural gas received by Lessee (or PPC or the working interest owners of the gas connected to the Byng System); or (ii.) Five Hundred Dollars ($500.00). The Gross Sales Revenue shall be the gross dollar amount (before any deductions) received by Lessee (or PPC or the working interest owners of the gas) for the sale of the gas which is connected to the Byng System by Lessee, except for any gas which may be sold by Lessee on the behalf of Lessor. The Gross Sales Revenue shall be calculated as the value received FOB the custody transfer point between the Byng System and any other third party pipeline system (such as Noram pipeline) and shall not be reduced for any fees, costs or expenses, including but not limited to, marketing fees, incurred to deliver such gas to a third party market. The Gross Sales Revenue amount shall be calculated using methods that are reasonably acceptable to the Parties and that are in accordance with any applicable industry standards, and shall be evidenced by documentation reasonably acceptable to Lessor.
5.2	Each month, Lessee shall provide Lessor with a statement showing the total gas volume in Mcfs and MMBtus connected to the Byng System and the total volume in MMBtus and gross sales price per MMBtu received by Lessee (PPC or the working interest owners of the gas) for the sale of such gas to its market(s). Lessor (and/or its duly authorized representatives) shall have the right, at any reasonable time and from time to time, to audit the records of Lessee and its affiliates that are reasonably needed in order to calculate and/or confirm the amounts that are due and owing under this Agreement. Lessee agrees to cooperate in furnishing to Lessor applicable records, documents, and other data in connection with such audits.
5.3	Lessee agrees to pay the Lease Rental Fee for each month within thirty (30) days after the end of such month. If any such payment is not paid within fifteen (15) days of the due date, then the amount due shall bear interest from such due date until payment is received, calculated at an annual rate equivalent to the lesser of (i.) 16%; or (ii.) the maximum interest rate which may be lawfully charged under applicable law.

SECTION 6. GAS PROCESSING

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

SECTION 7. TERM

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

SECTION 8. INSPECTION, NO REPRESENTATIONS

8.1

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

8.2

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

SECTION 9. DAMAGES AND LINE CHANGES OR RELOCATIONS

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

SECTION 10. INDEMNIFICATION

10.1

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

10.2

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

SECTION 11. INSURANCE

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

a.	Worker's Compensation and Employer's Liability Insurance, as prescribed by applicable law, with such, insurance containing a waiver of subrogation against Lessor.
b.	Commercial General Liability Insurance, covering the property and any related facilities or equipment, with combined single limits for bodily injury and property damage of $1,000,000 per occurrence and in the aggregate. The insurance shall include contractual liability coverage specifically insuring the indemnity agreement of Lessee contained herein, and shall cover the entire property leased herein. The insurance also shall include the following endorsement: Additional Insured Designated Person or Organization (CG 20 26 11 85) naming Lessor as an additional insured with respect to liability arising out of Lessee's actions or activities under this Agreement.
c.	Automobile Liability Insurance covering all owned, non–owned, and hired vehicles with a combined single limit for bodily injury and property damage of $1,000,000 per accident. This insurance shall include contractual liability coverage specifically insuring the indemnity agreement of Lessee contained herein.

11.2

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

11.3

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

SECTION 12. COMPLIANCE WITH LAWS AND TAXES

12.1

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

12.2

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

SECTION 13. OPTION TO PARTICIPATE IN WELLS/PROSPECTS

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

SECTION 14. MISCELLANEOUS

14.1	Lessor shall have the right to enter upon the property of the Byng System to inspect such property or related equipment or to enforce or carry out any provision of this Agreement.
14.2	This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns. Lessee shall not assign this Agreement in whole or in part nor sublet all or any part of the Byng System nor permit the use of any part of the property or pipelines by any other person or entity without the prior written consent of Lessor.
14.3	All notices required under this Agreement shall be deemed made when made in writing and personally delivered, received by overnight mail, received by telecopy, or received by certified or registered mail, return receipt requested, to the following addresses:

To Lessee:
Pontotoc Gathering, L.L.C.
1345 E. 29th Street
Tulsa, OK 74114
Phone #: 918.742.5835
Fax #: 918.743.2645
Attention: Mr. Tim Jurek

To Lessor:
Enerfin Resources I Limited Partnership
Three Riverway Suite 1200
Houston, TX 77056
Phone #: 713.888.8600
Fax #: 713.888.8629
Attention: Contract Administration

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

14.4	The occurrence of one or more of the following events constitutes a default under this Agreement, with the non–defaulting party having in such situation the right to immediately terminate this Agreement upon written notice to the defaulting party, with termination to be effective as of the date specified in the notice: (a) Failure to observe or perform any covenant, agreement, condition or provision of this Agreement if such failure shall continue for thirty (30) days after written notice to the defaulting party of such failure, except that if, because of the nature of the default, such default cannot be cured within such thirty (30) day period, such period shall be extended provided that the defaulting party commences to cure such default within such thirty (30) day period and proceeds diligently thereafter to effectuate such cure; or (b) Either party has a petition in bankruptcy filed by or against it, has a receiver appointed for it, becomes insolvent, or makes a general assignment for the benefit of creditors. In the event of default by Lessee, Lessor shall have the right, in addition to its other rights under this Agreement, to immediately re–enter the property.
14.5	This Agreement shall be construed in accordance with the laws of the state of Oklahoma.
14.6	This Agreement contains the entire agreement of the parties with respect to the subject matter thereof, and supersedes all prior and contemporaneous agreements, whether written or oral, between the parties with respect to the lease of the property. This Agreement may not be modified except by an instrument signed by both parties.

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

PONTOTOC GATHERING, L.L.C.

By:                 /s/ Timothy A. Jurek       

Name:              Timothy A. Jurek          

Title:                    President                  

ENERFIN RESOURCES I LIMITED PARTNERSHIP
    By:     Enerfin I Corporation
                 Managing General Partner

By:                 /s/ Dave C. Cremer    

Name:              Dave C. Cremer       

Title:               Vice President          

EX-10.3

Exhibit 10.3

INDEMNITY AGREEMENT

THIS INDEMNITY AGREEMENT (this "Agreement") is made and effective as of this ___ day of ________, 2001, by and between Ascent Energy Inc., a Delaware corporation (the "Company"), and ________________________ ("Indemnitee"). 

WITNESSETH: 

            WHEREAS, the Company seeks to attract and retain competent and experienced persons to serve as directors and desires to protect such individuals by providing comprehensive liability insurance and indemnification due to exposure to litigation costs and risks resulting from their service to the Company; 

            WHEREAS, the Board of Directors of the Company has concluded that to retain and attract talented and experienced individuals to serve as directors of the Company, and to encourage such individuals to take the business risks necessary for the success of the Company, it is necessary for the Company to contractually indemnify its directors and to assume for itself maximum liability for expenses and damages in connection with claims against its directors in connection with their service to the Company; 

            WHEREAS, the General Corporation Law of the State of Delaware (the "DGCL"), under which the Company is organized, empowers the Company to indemnify by agreement its directors and expressly provides that the indemnification provided in the DGCL is not exclusive; and 

            WHEREAS, the Company desires and has requested the Indemnitee to continue to serve as a director of the Company free from undue concern for claims for damages arising out of or related to such service to the Company. 

            NOW, THEREFORE, in consideration of the Indemnitee's agreement to continue to serve as a director of the Company, the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto stipulate and agree as follows: 

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

                        (a)     "agent" of the Company means any person who is or was a director of the Company or a subsidiary of the Company; or is or was serving at the request of, for the convenience of, or to represent the interest of the Company or a subsidiary of the Company as a director or officer of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise or an affiliate of the Company. The term "enterprise" includes any employee benefit plan of the Company, its subsidiaries or affiliates. 

                        (b)     "expenses" includes all direct and indirect costs of any type or nature whatsoever (including, without limitation, all attorneys' fees and related disbursements and other out–of–pocket costs) actually and reasonably incurred by the Indemnitee in connection with the investigation, defense or appeal of a proceeding or establishing or enforcing a right to indemnification or advancement of expenses under this Agreement, the Company's Certificate of Incorporation, Bylaws, the DGCL or otherwise. 

                        (c)     "proceeding" means any threatened, pending or completed action, suit or other proceeding, whether civil, criminal, administrative, arbitral, investigative or any other type whatsoever. 

                        (d)     "subsidiary" means any corporation or other business entity of which more than 50% of the outstanding voting securities is owned, directly or indirectly, by the Company, by the Company and one or more of its subsidiaries or by one or more of the Company's subsidiaries. 

            2.         Agreement to Serve. The Indemnitee agrees to continue to serve as a director and agent of the Company in the capacities Indemnitee currently serves or as he may hereafter agree to serve so long as he is duly appointed or elected and qualified in accordance with the applicable provisions of the Certificate of Incorporation or Bylaws of the Company, or until such time as he tenders his resignation in writing. 

            3.         Maintenance of Liability Insurance. 

                        (a)     The Company agrees that, as long as the Indemnitee shall continue to serve as a director of the Company and/or as an agent in any other capacity and thereafter for the period of five years following the termination of service, the Company shall maintain in full force and effect directors' and officers' liability insurance (the "D&O Insurance") in a minimum aggregate amount of $20 million for each policy year from established and reputable insurers on such terms as are approved from time to time by the Board of Directors. The Indemnitee shall be named as an insured in all D&O Insurance in such a manner as to provide the Indemnitee with the maximum rights and benefits available under the D&O Insurance. 

                        (b)    Notwithstanding anything in this Section 3 to the contrary, the Company shall have no obligation to maintain D&O Insurance if the Board of Directors determines in good faith that the premium costs for such insurance are disproportionate to the amount of coverage provided or the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit. 

            4.         Indemnification. To the fullest extent allowed by law, the Indemnitee shall be indemnified and held harmless by the Company against all expense incurred by Indemnitee in connection with any proceeding to which the Indemnitee is a party, participant or is threatened to be made a party or participant, based upon, arising from, relating to or by reason of the fact that the Indemnitee is, was, shall be or shall have been an agent. 

            5.         Mandatory Advancement of Expenses. The Company shall advance all expenses incurred by the Indemnitee in connection with the investigation, defense, settlement or appeal of any proceeding to which the Indemnitee is a party or is threatened to be made a party by reason of the fact that the Indemnitee is or was an agent or by reason of anything done or not done by him in any such capacity. The Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that the Indemnitee is not entitled to be indemnified by the Company under the provisions of this Agreement, the Certificate of Incorporation or Bylaws of the Company or the DGCL. The advances to be made hereunder shall be paid by the Company to the Indemnitee within 20 days following the delivery of a written request therefor by the Indemnitee to the Company. 

            6.         Notice and other Procedures. 

                        (a)     Promptly after receipt by the Indemnitee of notice of the commencement of or the threat of commencement of any proceeding, the Indemnitee shall, if the Indemnitee believes that indemnification with respect thereto may be sought from the Company under this Agreement, notify the Company of the commencement or threat of commencement thereof. 

                        (b)     If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 6(a), the Company has D&O Insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the D&O Insurance. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of the D&O Insurance. 

                        (c)     If the Company is obligated to advance the expenses for any proceeding, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by the Indemnitee (which approval shall not be unreasonably withheld), upon the delivery to the Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not be liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that: (i) the Indemnitee shall have the right to employ his own counsel in any such proceeding at the Indemnitee's expense; (ii) the Indemnitee shall have the right to employ his own counsel in connection with any such proceeding, at the expense of the Company, if such counsel serves in a review, observer, advice and counseling capacity and does not otherwise materially control or participate in the defense of such proceeding; and (iii) if (A) the employment of counsel by the Indemnitee has been previously authorized by the Company, (B) the Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and the Indemnitee in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of the Indemnitee's counsel shall be at the expense of the Company. 

            7.         Determination of Right to Indemnification. 

                        (a)     To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in Section 4 or in the defense of any claim, issue or matter described therein, the Indemnitee shall be entitled to indemnification from the Company and the Company shall indemnify the Indemnitee against expenses actually and reasonably incurred by him in connection with the investigation, defense or appeal of such proceeding. 

                        (b)     In the event that Section 7(a) is inapplicable, the Company shall also indemnify the Indemnitee unless, and only to the extent that, the Company shall prove by clear and convincing evidence to a forum listed in Subsection 7(c) that the Indemnitee's acts were committed in bad faith, or were the result of active and deliberate dishonesty, and were material to the cause of action so adjudicated and that the Indemnitee in fact personally gained a financial profit or other advantage to which he was not legally entitled. Neither the failure of the Company to have made a determination prior to the commencement of a proceeding that indemnification of the Indemnitee is proper under the circumstances because the Indemnitee has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Company that the Indemnitee has not met the applicable standard of conduct, shall be a defense to the action or create a presumption that the Indemnitee has not met the applicable standard of conduct. 

                        (c)     The Indemnitee shall be entitled to select the forum in which the validity of the Company's claim under Section 7(b) hereof that the Indemnitee is not entitled to indemnification will be heard from among the following: 

                                (i)     A quorum of the Board of Directors consisting of directors who are not parties to the proceeding for which indemnification is being sought or by a committee of such directors designated by a majority vote of such directors, even though less than a quorum; 

                                (ii)     The stockholders of the Company entitled to vote in the election of directors; provided that the common stock of the Company is not listed or traded on a national securities market or Nasdaq; 

                                (iii)     Legal counsel selected by the Indemnitee, and reasonably approved by the Board of Directors, which counsel shall make such determination in a written opinion; or 

                                (iv)     A panel of three arbitrators, one of whom is selected by the Company, another of whom is selected by the Indemnitee and the last of whom is selected by the first two arbitrators so selected. 

                        (d)     As soon as practicable, and in no event later than 30 days after written notice of the Indemnitee's choice of forum pursuant to Section 7(c), the Company shall, at its own expense, submit to the selected forum in such manner as the Indemnitee or the Indemnitee's counsel may reasonably request, its claim that the Indemnitee is not entitled to indemnification; and the Company shall act in the utmost good faith to assure the Indemnitee a complete opportunity to defend against such claim. 

                        (e)     After the final decision of the forum selected pursuant to Section 7(c) is rendered, the Indemnitee and Company shall each have the right to apply to the Court of Chancery of Delaware, the court in which that proceeding is or was pending or any other court of competent jurisdiction, for the purpose of appealing the decision of such forum; provided that such right is exercised within 60 days after the final decision of such forum is rendered. 

                        (f)     Notwithstanding any other provision in this Agreement to the contrary, the Company shall indemnify the Indemnitee against all expenses incurred by the Indemnitee in connection with any proceeding under this Section 7 involving the Indemnitee and against all expenses incurred by the Indemnitee in connection with any other proceeding between the Company and the Indemnitee involving the interpretation or enforcement of the rights of the Indemnitee under this Agreement unless a court of competent jurisdiction finds that each of the claims and/or defenses of the Indemnitee in any such proceeding was frivolous or made in bad faith. 

            8.         Exceptions. Notwithstanding any other provision of this Agreement, the Company shall not be obligated pursuant to the terms of this Agreement: 

                        (a)     To indemnify or advance expenses to the Indemnitee with respect to proceedings or claims initiated or brought voluntarily by the Indemnitee and not by way of defense, except with respect to proceedings specifically authorized by the Board of Directors or brought to establish or enforce a right to indemnification and/or advancement of expenses arising under this Agreement, the Certificate of Incorporation or Bylaws of the Company or any subsidiary or any statute or law or otherwise, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors finds it to be appropriate; 

                        (b)     To indemnify the Indemnitee hereunder for any amounts paid in settlement of a proceeding unless the Company consents in advance in writing to such settlement, which consent shall not be unreasonably withheld; or 

                        (c)     To indemnify the Indemnitee on account of any suit in which judgment is rendered against the Indemnitee for an accounting of profits made from the purchase or sale by the Indemnitee of securities of the Company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local statutory law. 

            9.         Successors; Binding Agreement. This Agreement shall be binding on, and shall inure to the benefit of and be enforceable by, each of the Indemnitee's personal or legal representatives, executives, administrators, successors, heirs, distributees, devisees and by each of the Company's successors and assigns. The Company shall require any successor or assignee (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by written agreement in form and substance reasonably satisfactory to the Company and to the Indemnitee, expressly to assume and agree to perform this Agreement in the same manner that the Company would be required to perform if no such succession or assignment had taken place. 

            10.         Credit for Insurance; Other Indemnities. Notwithstanding any other provision of this Agreement, the amount of indemnification payable by the Company with respect to any proceeding shall be subject to a credit for amounts actually paid to Indemnitee under or pursuant to (a) D&O Insurance and (b) provisions providing indemnification in the Certificate of Incorporation, Bylaws, resolutions, agreements or other instruments of the Company or any subsidiary. 

            11.         Deposit of Funds in Trust. If the Company voluntarily decides to dissolve or to file a petition for relief under any applicable bankruptcy, moratorium or similar laws, then not later than 10 days prior to such dissolution or filing, the Company shall deposit in trust for the sole and exclusive benefit of Indemnitee a cash amount equal to all amounts previously authorized to be paid to Indemnitee hereunder, such amounts to be used to discharge the Company's obligations to Indemnitee hereunder. Any amounts in such trust not required for such purpose shall be returned to the Company. This Section 11 shall not apply to the dissolution of the Company in connection with a transaction as to which Section 9 applies. 

            12.         Enforcement. 

                        (a)     The Company has entered into this Agreement and assumed the obligations imposed on the Company or hereby in order to induce the Indemnitee to continue to act as an agent of the Company and acknowledges that the Indemnitee is relying upon this Agreement in continuing in such capacity. 

                        (b)     All expenses incurred by the Indemnitee in connection with the preparation and submission of the Indemnitee's request for indemnification hereunder shall be borne by the Company. If the Indemnitee has requested payment of any amount under this Agreement and has not received payment thereof within 20 days of such request, the Indemnitee may bring any action to enforce rights or collect moneys due under this Agreement, and, if the Indemnitee is successful in such action, the Company shall reimburse the Indemnitee for all of the Indemnitee's fees and expenses in bringing and pursuing such action. If it is determined that the Indemnitee is entitled to indemnification for part (but not all) of the indemnification so requested, expenses incurred in seeking enforcement of such partial indemnification shall be reasonably prorated among the claims, issues or matters for which the Indemnitee is entitled to indemnification for claims, issues or matter for which the Indemnitee is not so entitled. The Indemnitee shall be entitled to the advancement of such amounts to the full extent contemplated by Section 5 hereof in connection with such proceeding. 

                        (c)     The Company shall be precluded from asserting in any judicial proceeding commenced under this Agreement that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court that the Company is bound by all the provisions of this Agreement. 

            13.         Savings Clause. If any provision of this Agreement is determined by a court having jurisdiction over the matter to violate or conflict with applicable law, the court shall be empowered to modify or reform such provision so that, as modified or reformed, such provision provides the maximum indemnification permitted by law and such provision, as so modified or reformed, and the balance of this Agreement, shall be applied in accordance with their terms. Without limiting the generality of the foregoing, if any portion of this Agreement shall be invalidated on any ground, the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated and to the full extent permitted by law with respect to that portion that has been invalidated. 

            14.         Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some claims, issues or matters related to a proceeding, but not as to other claims, issues or matters, or for some or a portion of the expenses in the investigation, defense, appeal or settlement of any proceeding, but not for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such claims, issues or matters or expenses to which Indemnitee is entitled. 

            15.         Non–Exclusivity. 

                        (a)     The right to indemnification provided by or granted pursuant to this Agreement shall not be deemed exclusive of any other rights to which Indemnitee is or may become entitled under any statute, provision of the Company's Certificate of Incorporation, Bylaws, agreement, resolution or otherwise. 

                        (b)     It is the intent of the Company by this Agreement to indemnify and hold harmless Indemnitee to the fullest extent permitted by law, so that if applicable law would permit the Company to provide broader indemnification rights than are currently permitted, the Company shall indemnify and hold harmless Indemnitee to the fullest extent permitted by applicable law notwithstanding that the other terms of this Agreement would provide for lesser indemnification. 

            16.         Confidentiality. The Company and Indemnitee shall keep confidential to the extent permitted by law and their fiduciary obligations all information and determinations provided pursuant to or arising out of the operations of this Agreement and the Company and Indemnitee shall instruct their agents and employees to do likewise. 

            17.         Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute an original but all of which taken together shall be deemed to constitute a single instrument. 

            18.         Applicable Law. This Agreement shall be governed by and construed in accordance with the substantive laws of the State of Delaware. 

            19.         Amendment. No amendment, modification, termination or cancellation of this Agreement shall be effective unless made in writing signed by the Company and Indemnitee. Notwithstanding any amendment, modification, termination or cancellation of this Agreement or any portion hereof, Indemnitee shall be entitled to indemnification in accordance with the provisions hereof with respect to any acts or omissions of Indemnitee which occur prior to such amendment, modification, termination or cancellation. 

            20.         Gender. All pronouns and variations thereof used in this Agreement shall be deemed to refer to the masculine, feminine or neuter gender, singular or plural, as the identity of the person, persons, entity or entities referred to may require. 

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

                                                                                  ASCENT ENERGY INC.

                                                                                  By: ____________________________________
                                                                                                                  Jeffrey Clark
                                                                                                                    President

                                                                                  INDEMNITEE: 

                                                                                  ____________________________________

EX-10.4

Exhibit 10.4

REGISTRATION RIGHTS AGREEMENT

            This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered into as of ____________, 2001, by and among Ascent Energy Inc., a Delaware corporation ("Ascent"), and those Persons whose names appear on the signature pages hereof.

            This Agreement is made in connection with the offering by Ascent of rights to subscribe for 
units consisting of one share of 8% Series A Redeemable Preferred Stock and one warrant to purchase 
_____ shares of common stock of Ascent (the "Rights Offering").

            The parties hereby agree as follows:    

            Section 1.    Definitions. As used in this Agreement, the following terms shall have the following meanings:

            "Agreement" shall have the meaning assigned to such term in the recitals hereto, as constituted on the date hereof and as amended from time to time.

            "Commission" means the Securities and Exchange Commission, or any other federal agency then administering the Securities Act.

            "Common Stock" means the common stock of Ascent, par value $0.001 per share, as constituted on the date hereof, and any shares into which such Common Stock shall have been changed or any shares resulting from any reclassification of such Common Stock.

            "Controlling Person" shall have the meaning given to such term in Section 7(a).

            "Demand Registration" shall have the meaning given to such term in Section 3(a).

            "Exchange Act" means the Securities Exchange Act of 1934, as amended, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect from time to time.

            "Holder" means each Person listed on the signature pages attached hereto or otherwise party to this Agreement who as of such date owns outstanding shares of Registrable Securities.

            "Indemnified Party" shall have the meaning given to such term in Section 7(c).

            "Indemnifying Party" shall have the meaning given to such term in Section 7(c).

            "Losses" means all losses, claims, damages or liabilities (other than consequential damages or incidental lost profits) and all costs and expenses related thereto, including, without limitation, the reasonable fees and disbursements of counsel.

            "Maximum Contribution Amount" shall have the meaning given to such term in Section 7(d).

            "NASD" means the National Association of Securities Dealers, Inc.

            "Person" shall mean any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust, unincorporated organization or government or agency or political subdivision thereof.

            "Piggyback Registration" shall have the meaning given to such term in a Section 4(a).

            "Proceeding" means any claim, suit, action or proceeding, including any governmental investigation or inquiry.

            "Qualified Holders" means any Holder or Holders holding at any time not less than 51% of all Registrable Securities.

            "Registrable Securities" means (a) the Common Stock held by any Holder on the date hereof or any Common Stock issuable pursuant to the conversion of the Series A Preferred Stock or upon exercise of the Warrants, (b) any shares of Common Stock acquired by any Holder after the date hereof or issuable upon the conversion or exercise of any other security issued by Ascent to any Holder and (c) any additional shares of Common Stock or other securities issued or distributed by Ascent after the date hereof to any Holder with respect to Common Stock, Series A Preferred Stock or Warrants by means of exchange, reclassification, dividend, distribution, split–up, combination, subdivision, recapitalization, merger, spin–off, reorganization or otherwise. As to any particular Registrable Securities, once issued such securities shall cease to be Registrable Securities when (i) a registration statement with respect to the sale of such securities has become effective under the Securities Act and such securities have been disposed of in accordance with such registration statement, (ii) they shall have been sold pursuant to Rule 144 under the Securities Act or (iii) they shall cease to be outstanding.

            "Rights Offering " shall have the meaning assigned to such term in the recitals hereto.

            "Securities Act" means the Securities Act of 1933, as amended, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect from time to time.

            "Series A Preferred Stock" means the 8% Series A Redeemable Preferred Stock of Ascent issued pursuant to the Rights Offering, as constituted on the date hereof, any shares into which such Series A Preferred Stock shall have been changed or any shares resulting from any reclassification of such Series A Preferred Stock.

            "Special Counsel" means counsel chosen by the holders of a majority of the Registrable Securities being sold pursuant to a registration covered by this Agreement.

            "Warrants" means the warrants to purchase Common Stock issued pursuant to the Rights Offering, a warrant issued in respect thereof or any Common Stock acquired upon the exercise of or in respect of any such warrant.

            Section 2.    Acknowledgement of Rights. Ascent will, upon request of any Holder, acknowledge in writing its obligations in respect of the rights to which such Holder shall be entitled under this Agreement; provided that the failure of such Holder to make any such request shall not affect the continuing obligations of Ascent to such Holder in respect of such rights.

            Section 3.    Demand Registration.

            (a)    At any time after [December 31, 2001 or 185 days after the date that the Common Stock is registered under Sections 12(b) or 12(g) of the Exchange Act], the Qualifying Holders may at any time and from time to time make a written request for registration under the Securities Act of an amount of Registrable Securities equal to not less than 5% of the then outstanding Common Stock (a "Demand Registration"); provided that Ascent shall not be obligated to affect more than two Demand Registrations in any 12 month period or more than an aggregate of four Demand Registrations pursuant to this Section 3(a). A registration will not count as a Demand Registration until the registration statement filed pursuant to such Demand Registration has been declared effective by the Commission and remains effective for the period specified in Section 5(b).

            (b)    If the Qualified Holders so elect, the offering of such Registrable Securities pursuant to a Demand Registration shall be in the form of an underwritten offering. The Qualified Holders shall select the managing underwriters and any additional investment bankers and managers to be used in connection with the offering; provided that such managing underwriters must be reasonably satisfactory to Ascent.

            (c)    Neither Ascent nor any of its security holders (other than the Holders in such capacity) shall be entitled to include any of Ascent's securities in a registration statement initiated as a Demand Registration under this Section 3(a) without the consent of the Qualified Holders.

             Section 4.    Piggyback Registration.

            (a)    If Ascent proposes to register Common Stock under the Securities Act (other than on registration statements with respect to corporate reorganizations or other transactions under Rule 145 under the Securities Act or registration statements on Form S–8), (i) for its own account or (ii) for the account of other holders of Common Stock (other than a Demand Registration pursuant to Section 3(a)), then Ascent shall give written notice of such proposed filing to the Holders as soon as practicable (but in no event later than 20 days before the filing date) and such notice shall offer the Holders the opportunity to register such number of shares of Registrable Securities as the Holders may request within 20 days after receipt by the holders of Ascent's notice on the same terms and conditions as Ascent or such holders of Common Stock (a "Piggyback Registration") The Holders will be permitted to withdraw all or any part of their Registrable Securities from a Piggyback Registration any time prior to the date the registration statement filed pursuant to such Piggyback Registration becomes effective with the Commission.

            (b)    Notwithstanding anything contained herein, if the Piggyback Registration is an underwritten offering and the lead managing underwriter of such offering delivers a written opinion to Ascent that the size of the offering Ascent, the Holders and any other Persons who securities are proposed to be included in such offering propose to make would materially and adversely affect the offering or offering price, Ascent will include in such Piggyback Registration all of the Common Stock it proposes to offer and the Common Stock proposed to be sold by the Holders and any other Persons in the following order of priority: (i) first, all of the Registrable Securities requested by the Holders, on a pro rata basis based on the amount of securities sought to be so registered and (ii) second, securities proposed to be registered by any other Persons.

            Section 5.    Registration Procedures. If and whenever Ascent is required by the provisions of this Agreement to use commercially reasonable efforts to effect the registration of any of the Registrable Securities under the Securities Act, Ascent will (except as otherwise provided in this Agreement):

            (a)    (i) cooperate with any underwriters for, and the selling Holders, and, in the event of any underwritten public offering, will enter into usual and customary underwriting agreements with respect thereto and take all such other reasonable actions as are necessary or advisable to permit, expedite and facilitate the disposition of such Registrable Securities in the manner contemplated by the related registration statement, and in each case to the same extent as if all the securities then being offered were for the account of Ascent, and (ii) provide to any selling Holder, any underwriter participating in any distribution thereof pursuant to a registration statement, and any attorney, accountant or other agent retained by any selling Holder or any underwriter reasonable access to appropriate Ascent officers and employees to answer questions and to supply information reasonably requested by such selling Holder, or by any such underwriter, attorney, accountant or agent in connection with such registration statement;

            (b)    prepare and file with the Commission a registration statement with respect to such securities and use commercially reasonable efforts to cause such registration statement to become and remain effective until the earlier to occur of the passage of 90 days from the date of effectiveness and the sale of all of the Registrable Securities registered under such registration statement; and prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective for the time period required pursuant to this Agreement and to comply with the provisions of the Securities Act with respect to the sale or other disposition of all securities covered by such registration statement whenever the selling Holders shall desire to sell or otherwise dispose of the same;

            (c)    furnish to such selling Holders, who so request, (i) upon Ascent's receipt, a copy of the order of the Commission declaring such registration statement and any post–effective amendment thereto effective, (ii) such reasonable number of copies of such registration statement and of each amendment and supplement thereto (in each case including any documents incorporated therein by reference and all exhibits), (iii) such reasonable number of copies of the prospectus included in such registration statement (including each preliminary prospectus), (iv) such reasonable number of copies of the final prospectus as filed by Ascent pursuant to Rule 424(b) under the Securities Act, in conformity with the requirements of the Securities Act, and (v) such other documents, as any such Person may reasonably request. Ascent hereby consents to the use of the prospectus by each of the selling Holders and the underwriters or agents, if any, and dealers (if any), in connection with the offering and sale of the Registrable Securities pursuant to, such prospectus and any amendment thereto;

            (d)    use commercially reasonable efforts to (i) register or qualify the securities covered by such registration statement under such other securities or blue sky laws of such jurisdictions as each selling Holder shall reasonably request, (ii) keep such registrations or qualifications in effect and comply with such laws so as to permit the continuance of offers, sales and dealings therein in such jurisdictions for so long as may be necessary to enable such Holder, or any such agent or underwriter to complete its distribution of the securities pursuant to such registration statement but in no event longer than two years and (iii) cooperate with such Holders and each underwriter, if any, in connection with any filings required to be made with the NASD and do any and all other acts and things which may be reasonably necessary or advisable to enable such Holder to consummate the disposition in each such jurisdiction of such Registrable Securities owned by such Holder; provided, however, that Ascent shall not be required to (A) qualify to do business as a foreign corporation or as a dealer in securities in any jurisdiction where it would not otherwise be required to qualify but for this Section 5(d) or (B) file any general consent to service of process;

            (e)    notify each selling Holder and counsel for such selling Holders identified to Ascent and, if requested by such Persons, confirm such advice in writing, (i) when the registration statement has become effective and when any post–effective amendment thereto has been filed and becomes effective, (ii) of any request by the Commission or any state securities authority for amendments and supplements to the registration statement and prospectus or for additional information after the registration statement has become effective, (iii) of the issuance by the Commission or any state securities authority of any stop order suspending the effectiveness of the registration statement or the initiation of any Proceedings for that purpose, (iv) if Ascent receives any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation of any Proceeding for such purpose, (v) of the happening of any event during the period a registration statement is effective which makes any statement made in such registration statement or the related prospectus untrue in any material respect or which requires the making of any changes in such registration statement or any document incorporated by reference therein in order to make the statements therein not misleading or which requires the making of any changes in the prospectus or documents incorporated by reference therein in order to make the statements therein, in light of the circumstances under which they were made, not misleading and (vi) of any determination by Ascent that a post–effective amendment to the registration statement would be appropriate;

            (f)    use its best efforts to prevent the issuance of any order suspending the effectiveness of a registration statement or of any order preventing or suspending the use of a prospectus or suspending the qualification (or exemption from qualification) of any of the securities for sale in any jurisdiction, and, if any such order is issued, to use commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of a registration statement at the earliest possible time and provide prompt notice to each selling Holder of the withdrawal of any such order;

            (g)    comply with all applicable rules and regulations of the Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months, beginning with the first fiscal quarter beginning after the effective date of the registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act);

            (h)    list such securities on any securities exchange or market on which any stock of Ascent is then listed, if the listing of such securities is then permitted under the rules of such exchange;

            (i)     if requested by the managing underwriters, if any, or the Holders of a majority of the Registrable Securities being registered, (i) promptly incorporate in a prospectus supplement or post–effective amendment such information as the managing underwriters, if any, and such Holders reasonably agree should be included therein to the extent required by applicable law and (ii) make all required filings of such prospectus supplement or such post–effective amendment as soon as practicable after Ascent has received notification of the matters to be incorporated in such prospectus supplement or post–effective amendment; provided, however, that Ascent will not be required to take any actions under this Section 5(i) that are not, in the opinion of counsel for Ascent, required by applicable law; and

            (j)     enter into such agreements (including, in the event of an underwritten offering, an underwriting agreement in form, scope and substance as is customary in underwritten offerings) and take all such other commercially reasonable actions in connection therewith (including those reasonably required by the Holders of a majority of the Registrable Securities being sold or, in the event of an underwritten offering those requested by the managing underwriters) in order to permit the disposition of such Registrable Securities and in such connection, if the registration is an underwritten registration, (i) make such representations and warranties to the Holders of such Registrable Securities and underwriters, if any, with respect to the business of Ascent and its subsidiaries, the registration statement, the prospectus and documents incorporated by reference or deemed incorporated by reference in the registration statement, if any, in each case, in form, substance and scope if and when requested; (ii) obtain opinions of counsel to Ascent and updates thereof (which counsel and opinions (in form, scope and substance) shall be reasonably satisfactory to the managing underwriters, if any, and the Holders of a majority of the Registrable Securities being sold) addressed to such selling Holders of Registrable Securities and each of the, underwriters, if any, covering the matters customarily covered in opinions requested in underwritten offerings and such other matters as may be reasonably requested by such Holders and underwriters, including without limitation the matters referred to in clause (i) above; (iii) use its reasonable commercial efforts to obtain "comfort" letters and updates thereof from the independent certified public accountants of Ascent (and, if necessary, any other certified public accountants of any subsidiary of Ascent or of any business acquired by Ascent for which financial statements and financial data is, or is required to be, included in the Registration Statement), addressed to each of the underwriters, if any, such letters to be in customary form and covering matters the type customarily covered in "comfort" letters in connection with underwritten offerings; and (iv) deliver such documents and certificates as may reasonably be requested by the Holders of a majority of the Registrable Securities being sold, the Special Counsel and the managing underwriters, if any, to evidence the continued validity of the representations and warranties of Ascent and its subsidiaries made pursuant to clause (i) above and to evidence compliance with any customary conditions contained in the underwriting, agreement or similar agreement entered into by Ascent. The foregoing actions will be taken in connection with each closing under such underwriting or similar agreement as and to the extent required thereunder.

            From time to time after a transfer of Registrable Securities pursuant to a registration statement Ascent will file all reports required to be filed by it under the Securities Act and the Exchange Act. Ascent may require each such Holder to agree to keep confidential any non–public information relating to Ascent received by such Holder and not disclose such information (other than to an Affiliate or prospective purchaser who agrees to respect the confidentiality provisions of this Section 5) until such information has been made generally available to the public unless the release of such information is required by law or necessary to respond to inquiries of regulatory authorities.

            Section 6.    Registration Expenses; Hold–Backs.

            (a)    In connection with any Demand Registration or any Piggyback Registration, Ascent shall pay the following expenses incurred in connection with such registration: (i) filing fees with the Commission; (ii) fees and expenses of compliance with securities or blue sky laws (including reasonable fees and disbursements of counsel in connection with blue sky qualifications of the Registrable Securities); (iii) printing expenses; (iv) fees and expenses incurred in connection with the listing of the Registrable Securities; (v) fees and expenses of counsel and independent certified public accountants for Ascent and (vi) the reasonable fees and expenses of any additional experts retained by Ascent in connection with such registration. In connection with the preparation and filing of a Registration Statement pursuant to Section 3(a), Ascent will also pay the reasonable fees and expenses of a single legal counsel chosen by the Qualified Holders. The Holders shall pay any underwriting fees, discounts or commissions attributable to the sale of Registrable Securities and any other expenses of the Holders.

            (b)    No person may participate in any underwritten registered offering contemplated hereunder unless such Person (i) agrees to sell its securities on the basis provided in any underwriting agreements approved by the Persons entitled hereunder to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements and this Agreement.

            (c)    The Holders agree not to effect any public sale (including a sale pursuant to Rule 144 of the Securities Act) of any Registrable Securities, or any securities convertible into or exchangeable or exercisable for such securities, during the 14 days prior to, and during the 90–day (180 days in the case of an initial public offering of Common Stock) period beginning on, the effective date of any underwritten Demand Registration or any underwritten Piggyback Registration (other than the Registrable Securities to be sold pursuant to such registration statement).

            Section 7.    Indemnification.

            (a)    In the event of any registration of any of its securities under the Securities Act pursuant to this Agreement, to the extent permitted by law, Ascent shall indemnify and hold harmless the Holders, the Holders' directors, officers, partners, employees, representatives and agents, and each other person, if any, who controls any Holder within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act (a "Controlling Person"), to the fullest extent possible against any Losses, as incurred, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue or alleged untrue statement of a material fact contained in any registration statement, prospectus or form of prospectus, or in any amendment or supplement thereto, or in any preliminary prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except insofar as such Losses are based upon information relating to such Holder and furnished in writing to Ascent by such Holder expressly for use therein; provided, however, that Ascent shall not be liable to any Indemnified Party to the extent that any such Losses arise solely out of an untrue statement or alleged untrue statement or omission or alleged omission made in any preliminary prospectus if (i) such Indemnified Party or related Holder failed to send or deliver a copy of the prospectus with or prior to the delivery of written confirmation of the sale by such Indemnified Party or the related Holder to the Person asserting the claim from which such Losses arise; (ii) the prospectus would have corrected such untrue statement or alleged untrue statement or omission or alleged omission; and (iii) Ascent has complied with its obligations under Section 5(e). Ascent shall also, jointly and severally, indemnify underwriters, selling brokers, dealer managers and similar securities industry professionals participating in the distribution and their Controlling Persons to the same extent as provided above with respect to the indemnification of the Holders.

            (b)    In connection with any registration statement, prospectus or form of prospectus, any amendment or supplement thereto, or any preliminary prospectus in which a Holder is participating, such Holder shall furnish to Ascent in writing such information as Ascent reasonably requests for use in connection with any registration statement, prospectus or form of prospectus, any amendment or supplement thereto, or any preliminary prospectus and shall, without limitation as to time, indemnify and hold harmless Ascent, its Controlling Persons, and the officers, directors, partners, employees, representatives and agents of such Controlling Persons, to the fullest extent lawful, from and against all Losses arising out of or based upon any untrue or alleged untrue statement of a material fact contained in any registration statement, prospectus or form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading to the extent, but only to the extent, that such untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact is contained in any information so furnished in writing by such Holder to Ascent expressly for use therein. In no event shall the liability of any selling Holder be greater in amount than the dollar amount of the proceeds (net of payment of all expenses) received by such Holder upon the sale of the Registrable Securities giving rise to such indemnification obligation.

            (c)    If any Proceeding shall be brought or asserted against any Person entitled to indemnity hereunder (an "Indemnified Party"), such Indemnified Party shall promptly notify the party or parties from which such indemnity is sought (individually, an "Indemnifying Party" and, collectively, the "Indemnifying Parties") in writing; provided, that the failure to so notify the Indemnifying Parties shall not relieve the Indemnifying Parties from any obligation or liability except to the extent that it shall be finally determined by a court of competent jurisdiction (which determination is not subject to appeal) that the Indemnifying Parties have been prejudiced materially by such failure. The Indemnifying Party shall have the right, exercisable by giving written notice to an Indemnified Party, within twenty days after receipt of written notice from such Indemnified Party of such Proceeding, to assume, at its expense, the defense of any such Proceeding; provided, that an Indemnified Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but, subject to Section 6, the fees and expenses of such counsel shall be at the expense of such Indemnified Party unless: (1) the Indemnifying Party has agreed to pay such fees and expenses; or (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding or shall have failed to employ counsel reasonably satisfactory to such Indemnified Party; or (3) the named parties to any such Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying Party or any of its affiliates or Controlling Persons, and such Indemnified Party shall have been advised by counsel that there may be one or more defenses available to such Indemnified Party that are in addition to, or in conflict with, those defenses available to the Indemnifying Party or such affiliate or Controlling Person (in which case, if such Indemnified Party notifies the Indemnifying Parties in writing that it elects to employ separate counsel at the expense of the Indemnifying Parties, the Indemnifying Parties shall not have the right to assume the defense thereof and the reasonable fees and expenses of such counsel shall be at the expense of the Indemnifying Party; it being understood, however, that, the Indemnifying Party shall not, in connection with any one such Proceeding or separate but substantially similar or related Proceedings in the same jurisdiction, arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (together with appropriate local counsel) at any time for such Indemnified Party).

            No Indemnifying Party shall be liable for any settlement of any such Proceeding effected without its written consent, but if settled with its written consent, or if there be a final judgment for the plaintiff in any such Proceeding, each Indemnifying Party jointly and severally agrees, subject to the exceptions and limitations set forth above, to indemnify and hold harmless each Indemnified Party from and against any and all Losses by reason of such settlement or judgment. The Indemnifying Party shall not consent to the entry of any judgment against an Indemnified Party or enter into any settlement that imposes any obligation on any Indemnified Party that does not include as a term thereof the giving by the claimant or plaintiff to each Indemnified Party of a release, in form and substance reasonably satisfactory to the Indemnified Party, from all liability in respect of such Proceeding for which such Indemnified Party would be entitled to indemnification hereunder (regardless of whether any Indemnified Party is a party thereto).

            (d)    If the indemnification provided for in this Section 7 is unavailable to an Indemnified Party or is insufficient to hold such Indemnified Party harmless for any Losses in respect of which this Section 7 would otherwise apply by its terms (other than by reason of exceptions provided in this Section 7), then each applicable Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall have a joint and several obligation to contribute to the amount paid or payable by such Indemnified Party as a result of such Losses, in such proportion as is appropriate to reflect the relative fault of each Indemnifying Party, on the one hand, and such Indemnified Party, on the other hand, in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of each Indemnifying Party, on the one hand, and Indemnified Party, on the other hand, shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such Indemnifying Party or Indemnified Party, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent any such statement or omission. The amount paid or payable by an Indemnified Party as a result of any Losses shall be deemed to include any legal or other fees or expenses incurred by such party in connection with any Proceeding, to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in Section 7(a) or 7(b) was available to such party.

            The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 7, an Indemnifying Party that is a selling Holder shall not be required to contribute, in the aggregate, any amount in excess of such Holder's Maximum Contribution Amount. A selling Holder's "Maximum Contribution Amount" shall equal the excess of (i) the aggregate proceeds received by such Holder pursuant to the sale of such Registrable Securities over (ii) the aggregate amount of damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

            The indemnity and contribution agreements contained in this Section 7 are in addition to any liability that the Indemnifying Parties may have to the Indemnified Parties.

            Section 8.    Rule 144. Ascent covenants that it will file any reports required to be filed by it under the Securities Act and the Exchange Act and that it will take such further action as any Holder may request to the extent required from time to time to enable the Holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 under the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission. Upon the request of a Holder, Ascent will deliver to the Holder a written statement as to whether it has complied with such reporting requirements.

            Section 9.    Assignment of Registration Rights. A Holder may assign its rights hereunder to a transferee or assignee at any time such Holder transfers or assigns Registrable Securities representing not less than 0.5% of all Registrable Securities subject to this Agreement on the date hereof to such transferee or assignee; provided, that (a) Ascent is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned; (b) such transferee or assignee agrees in writing to be bound by and subject to the terms and conditions of this Agreement by executing a counterpart signature page hereto; (c) such assignment of Registrable Securities is made in compliance with the Securities Act; and (d) such assignment shall be effective only if immediately following such transfer the further disposition of such securities by the transferee or assignee is restricted under the Securities Act. This Agreement may not be assigned by Ascent without the prior written consent of the Qualified Holders.

            Section 10.    Miscellaneous.

            (a)    Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand–delivery, certified first–class mail, return receipt requested, next–day air courier or facsimile:

                    (i)         if to a Holder, at the address of such Holder set forth on Ascent's stock records. 

                    (ii)        if to Ascent, at: 

                                Ascent Energy, Inc.
                                650 Poydras Street, Suite 2200
                                New Orleans, LA 70130
                                Facsimile Number: (504) 522–1796
                                Attention: President

and thereafter at such other address, notice of which is given in accordance with the provisions of this Section 9(a). All such notices and communications shall be deemed to have been duly given: when delivered by hand, if personally delivered; five days after being deposited in the mail, postage prepaid, if mailed; one day after being timely delivered to a next–day air courier; and when receipt is acknowledged by the addressee, if sent by facsimile.

            (b)    Amendment and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless Ascent has obtained the written consent of Holders of at least a majority of the then outstanding aggregate principal amount of Registrable Securities; provided, that Section 7 shall not be amended, modified or supplemented, and waivers or consents to departures from this proviso may not be given, unless Ascent has obtained the written consent of each Holder affected thereby. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders whose securities are being sold pursuant to a registration statement and that does not directly or indirectly affect the rights of other Holders may be given by Holders of at least a majority in aggregate principal amount of the Registrable Securities being sold by such Holders pursuant to such registration statement; provided that the provisions of this sentence may not be amended, modified or supplemented except in accordance with the provisions of the immediately preceding sentence.

            (c)    Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by facsimile transmission shall be effective as delivery of a manually executed counterpart of this Agreement.

            (d)    Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York without regard to rules of conflicts of laws.

            (e)    Filing. A copy of this Agreement and of all amendments hereto shall be filed at the principal office of Ascent.

            (f)    Headings and Internal References. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. References in this Agreement to "clauses" and "Sections" shall be understood to refer to clauses and sections of this Agreement unless otherwise specified.

            (g)    Remedies. In the event of a breach by Ascent of any of its obligations under this Agreement, each Holder, in addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. Ascent agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of any of the provisions of this Agreement and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall waive the defense that a remedy at law would be adequate.

            (h)    No Inconsistent Agreements. Ascent has not entered into, as of the date hereof, and shall not enter into, after the date of this Agreement, any agreement with respect to any of its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof.

            (i)    Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties.

            (j)    Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement, and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein, with respect to the registration rights granted by Ascent in respect of the Registrable Securities. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

            (k)    Attorneys' Fees. In any Proceeding brought to enforce any provision of this Agreement, or where any provision hereof is validly asserted as a defense, the prevailing party, as determined by the courts, shall be entitled to recover reasonable attorneys' fees in addition to its costs and expenses and any other available remedy.

            (l)    Third Party Beneficiary. Ascent hereby expressly agrees and acknowledges that the Holders are intended to be express third party beneficiaries of this Agreement and that each Holder shall be entitled to exercise any and all rights and remedies afforded to them under this Agreement and the laws of the relevant jurisdiction applicable to third party beneficiaries.

[signature pages follow]

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

                                                                                ASCENT ENERGY INC., a Delaware corporation


                                                                                 By:                                                                 
                                                                                          Jeffrey Clarke
                                                                                          President

                                                                                 HOLDERS:

                                                                                 [To Come]

ASCENT ENERGY INC.
REGISTRATION RIGHTS AGREEMENT

            This signature page is for the Registration Rights Agreement dated as of __________, 2001 (the "Agreement"), by and among Ascent and the Holders, and by execution below the undersigned agrees that it shall be attached as a signature page to such Agreement.

By:                                                                                      
        Name:                                                                        
        Title:                                                                            
                Tax I.D. No.:                                                      
                Address:                                                             
                                                                                            
                                                                                            
                Attention:                                                             
                Fax Number:                                                        
                Phone Number:                                                   

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our reports included in this registration statement and to all references to our Firm included in this registration statement.

         /s/ Arthur Andersen LLP
Arthur Andersen LLP

March 22, 2001
New Orleans, Louisiana

EX-23.2

EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

We hereby consent to the incorporation by reference of our report dated May 12, 2000 relating to the financial statements of Pontotoc Production, Inc. ("Pontotoc") as of March 31, 1999 and 2000, and for the two years then ended, and to all references to our firm included in this registration statement on Form S–4 filed by Ascent Energy Inc.

GRANT THORNTON LLP

Oklahoma City, Oklahoma
March 23, 2001

EX-23.4

EXHIBIT 23.4

CONSENT OF PERSON ABOUT TO BECOME A DIRECTOR

         In accordance with Rule 438 promulgated under the Securities Act of 1933, as amended, the undersigned hereby consents to his being named as a person about to become a director of Ascent Energy Inc. in this registration statement on form S–4 filed by Ascent Energy Inc.

                                                                                                                                  /s/ James Robson, Jr.                 
                                                                                                                            James "Robby" Robson, Jr.

Date: March 14, 2001

EX-23.5

EXHIBIT 23.5

CONSENT OF PERSON ABOUT TO BECOME A DIRECTOR

            In accordance with Rule 438 promulgated under the Securities Act of 1933, as amended, the undersigned hereby consents to his being named as a person about to become a director of Ascent Energy Inc. in this registration statement on form S–4 filed by Ascent Energy Inc.

                                                                                                                               /s/ Jerry W. Box                              
                                                                                                                                    Jerry W. Box

Date: March 13, 2001

EX-23.6

EXHIBIT 23.6

CONSENT OF NETHERLAND SEWELL & ASSOCIATES, INC.

                    As independent oil and gas consultants, Netherland Sewell & Associates, Inc., hereby consents to the use of our reserve report for Forman Petroleum Corporation dated as of December 31, 2000 and to all references to our firm included in or made a part of  this registration statement on Form S–4 filed by Ascent Energy Inc.

                                                                                                              NETHERLAND SEWELL & ASSOCIATES, INC.

                                                                                                              By:            /s/ Danny D. Simmons                            
                                                                                                                       Danny D. Simmons
                                                                                                                       Senior Vice President

March 16, 2001
Houston, Texas

EX-23.7

EXHIBIT 23.7

CONSENT OF FLETCHER LEWIS ENGINEERING, INC.

            As independent oil and gas consultants, Fletcher Lewis Engineering, Inc., hereby consents to the use of our reserve report for Pontotoc Production, Inc. dated as of March 31, 2000 and to all references to our firm included in or made a part of this registration statement on Form S–4 filed by Ascent Energy Inc.

                                                                FLETCHER LEWIS ENGINEERING, INC.

                                                                                                  By:                                 /s/ Fletcher Lewis                     

                                                                                                  Name:                            Fletcher Lewis                           

                                                                                                  Title:                              President                                    

March 14,  2001

EX-23.8

EXHIBIT 23.8

CONSENT OF C. K. COOPER & COMPANY, INC.

         We hereby consent to the inclusion and use of our fairness opinion letter, dated January 18, 2001, to the Board of Directors of Pontotoc Production, Inc. ("Pontotoc") with forms part of the registration statement on Form S–4 of Ascent Energy Inc. ("Ascent") relating to the proposed business combination involving Pontotoc, Ascent and Pontotoc Acquisition Corp., and the disclosures relating to such fairness opinion.

                In giving such consent, we do not represent that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended (the "Securities Act"), or the rules or regulations of the Securities and Exchange Commission thereunder, nor do we represent that we are experts with respect to any part of such registration statement within the meaning of the term "experts" as used in the Securities Act or the rules and regulations of the Securities and Exchange Commission thereunder.

     /s/ Annagene E. Montano                             
C. K. COOPER & COMPANY, INC.

Irvine, California
March 14, 2001

EX-99

Exhibit 99.1

LETTER OF TRANSMITTAL

To Exchange Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.
pursuant to the Prospectus dated ___________, 2001

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK TIME ON _________, 2001
UNLESS THE OFFER IS EXTENDED

The Exchange Agent for the Offer is:

MELLON INVESTOR SERVICES LLC

Facsimile (for eligible institutions only):

(201) 296–4293

By Mail: Reorganization Department
P.O. Box 3301
South Hackensack, NJ 07606 By Hand: Reorganization Department
120 Broadway
13^th Floor
New York, NY 10271 By Overnight: Reorganization Department
85 Challenger Road
Mail Drop – Reorg
Ridgefield Park, NJ 07660

DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR TRANSMISSIONS OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF TRANSMITTAL IN THE APPROPRIATE SPACE PROVIDED THEREFOR AND COMPLETE THE SUBSTITUTE FORM W–9 SET FORTH BELOW.

THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.

        This Letter of Transmittal is to be completed by stockholders of Pontotoc Production, Inc. ("Pontotoc") if certificates for the Pontotoc Shares (as such term is defined below) are to be forwarded herewith or, unless an Agent's Message (as defined in the Prospectus, dated ________, 2001 (the "Prospectus")) is utilized, if delivery of the Pontotoc Shares is to be made by book–entry transfer into an account maintained by the Exchange Agent at The Depository TrustCompany (the "Book–Entry Transfer Facility")pursuant to the procedures set forth under "The Offer – Procedure for Tendering" in the Prospectus. Stockholders who tender Pontotoc Shares by book–entry transfer are referred to herein as "Book–Entry Stockholders" and other stockholders who deliver Pontotoc Shares are referred to herein as "Certificate Stockholders"

        Holders of the Pontotoc Shares whose certificates for such shares are not immediately available or who cannot deliver either the certificates for, or a book–entry confirmation (as defined in "The Offer – Procedure for Tendering" of the Prospectus) with respect to, their Pontotoc Shares and all other required documents to the Exchange Agent prior to the Expiration Date, must tender their Pontotoc Shares according to the guaranteed delivery procedure set under "The Offer – Guaranteed Delivery" in the Prospectus. See Instruction 2 below. DELIVERY OF DOCUMENTS TO A BOOK–ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.

DESCRIPTION OF SHARES TENDERED
Names(s) & Address(es) of Registered Holder(s)                 (Please fill in, if blank, exactly as                                            name(s) appear(s) on certificate(s))	Share Certificate(s) and Shares Tendered   (Attach additional signed list if necessary)

Share Certificate (s)*	Total Number of Shares Represented by Certificate(s)*	Number of Shares Tendered**
Total Shares ................................................

*     Need not be completed by Book–Entry Stockholders.
**   Unless otherwise indicated, all Pontotoc Shares represented by certificates delivered to the
               Exchange Agent will be deemed to have been tendered.
               See Instruction 4. 

G CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING PONTOTOC SHARES THAT YOU OWN HAVE BEEN LOST OR DESTROYED AND SEE INSTRUCTION 11.

Number of shares represented by the lost or destroyed certificate(s): _______  

G	CHECK HERE IF PONTOTOC SHARES ARE BEING TENDERED BY BOOK–ENTRY TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH A BOOK–ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK–ENTRY TRANSFER FACILITY MAY DELIVER PONTOTOC SHARES BY BOOK–ENTRY TRANSFER):
	Name of Tendering Institution:
	Account Number: Transaction Code Number:
G	CHECK HERE IF PONTOTOC SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT, ENCLOSE A PHOTOCOPY OF SUCH NOTICE AND COMPLETE THE FOLLOWING:
	Name(s) of Registered Owner(s):
	Window Ticket Number (if any):
	Date of Execution of Notice of Guaranteed Delivery:
	Name of Institution that Guaranteed Delivery:
	Account Number: Transaction Code Number:

NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

Ladies and Gentlemen:

     The undersigned hereby tenders to Pontotoc Acquisition Corp. ("Purchaser"), a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation ("Ascent Energy"), the above–described shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"). The above–described Pontotoc Shares are being tendered pursuant to Purchaser's offer to exchange $9.00 in cash, without interest, and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.01 per share, having a liquidation preference equal to $2.50 (the "Ascent Energy Preferred Shares"), for each Pontotoc Share, upon the terms and subject to the conditions set forth in the Prospectus and in this Letter of Transmittal (which, together with any amendments or supplements hereto or thereto collectively constitute the "Offer"). The undersigned understands that Purchaser reserves the right to transfer or assign, in whole or from time to time in part, to one or more corporations directly or indirectly owned by Ascent Energy, the right to purchase all or any portion of the Pontotoc Shares tendered pursuant to the Offer, receipt of which is hereby acknowledged.

        Subject to, and effective upon, acceptance for payment for the Pontotoc Shares tendered herewith in accordance with the terms and subject to the conditions of the Offer (and if the Offer is extended or amended, the terms of any such extension or amendment), the undersigned hereby sells, assigns and transfers to, or upon the order of, Purchaser all right, title and interest in and to all of the Pontotoc Shares that are being tendered hereby and any and all dividends, distributions (including additional Pontotoc Shares) or rights declared, paid or issued with respect to the tendered Pontotoc Shares on or after the date hereof and payable or distributable to the undersigned on a date prior to the transfer to the name of Purchaser or nominee or transferee of Purchaser on Pontotoc's stock transfer records of the Pontotoc Shares tendered herewith (collectively, a "Distribution"), and appoints the Exchange Agent the true and lawful agent and attorney–in–fact of the undersigned with respect to such Pontotoc Shares (and any and all Distributions) with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest) to (a) deliver certificates for the Pontotoc Shares (and any and all Distributions) or transfer ownership of such Pontotoc Shares (and any and all Distributions) on the account books maintained by a Book–Entry Transfer Facility, together, in either case, with appropriate evidences of transfer, to the Exchange Agent for the account of Purchaser, (b) present such Pontotoc Shares (and any and all Distributions) for transfer on the books of Pontotoc and (c) receive all benefits and otherwise exercise all rights of beneficial ownership of such Pontotoc Shares (and any and all Distributions), all in accordance with the terms and subject to the conditions of the Offer.

        The undersigned irrevocably appoints designees of Purchaser as such stockholder's attorney–in–fact and proxy, with full power of substitution, to the full extent of such stockholder's rights with respect to the Pontotoc Shares tendered by such stockholder and accepted for payment by Purchaser and with respect to any and all other shares or other securities issued or issuable in respect of such Pontotoc Shares on or after the date hereof. Such appointment will be effective when, and only to the extent that, Purchaser accepts such Pontotoc Shares for payment. Upon such acceptance for payment, all prior proxies given by such stockholder with respect to such Pontotoc Shares (and such other shares and securities) will be revoked without further action, and no subsequent proxies may be given nor any subsequent written consents executed (and, if given or executed, will not be deemed effective). The designees of Purchaser will be empowered to exercise all voting and other rights of such stockholder as they in their sole discretion may deem proper at any annual or special meeting of Pontotoc's stockholders or any adjournment or postponement thereof, by written consent in lieu of any such meeting or otherwise. Purchaser reserves the right to require that, in order for the Pontotoc Shares to be deemed validly tendered, immediately upon Purchaser's payment for such Pontotoc Shares Purchaser must be able to exercise full voting rights with respect to such Pontotoc Shares.

        The undersigned hereby represents and warrants that (a) the undersigned has full power and authority to tender, sell, assign and transfer the Pontotoc Shares (and any and all Distributions) tendered hereby and (b) that the undersigned owns the Pontotoc Shares tendered hereby and that when the Pontotoc Shares are accepted for exchange by Purchaser, Purchaser will acquire good, marketable and unencumbered title to the Pontotoc Shares (and any and all Distributions), free and clear of all liens, restrictions, charges and encumbrances, and the same will not be subject to any adverse claim. The undersigned, upon request, will execute and deliver any additional documents deemed by the Exchange Agent or Purchaser to be necessary or desirable to complete the sale, assignment and transfer of the Pontotoc Shares tendered hereby (and any and all Distributions). In addition, the undersigned shall promptly remit and transfer to the Exchange Agent for the account of Purchaser any and all Distributions in respect to the Pontotoc Shares tendered hereby, accompanied by appropriate documentation of transfer; and pending such remittance or appropriate assurance thereof, Purchaser will be, subject to applicable law, entitled to all rights and privileges as the owner of any such Distribution and may withhold the entire purchase price or deduct from the purchase price the amount or value thereof, as determined by Purchaser in its sole discretion.

        The undersigned understands that no public trading market exists for the Ascent Energy Preferred Shares nor the common stock of Ascent Energy into which such shares are convertible. The undersigned reasonably believes that any Ascent Energy Preferred Shares acquired through the exchange of his Pontotoc Shares will be acquired for investment purposes only, for his own account or for the account of the person for whom or the entity for which he acts as a fiduciary, and not with a view to the sale or resale, distribution or transfer thereof.

        All authority herein conferred or agreed to be conferred shall not be affected by and shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Except as stated in the Prospectus, this tender is irrevocable.

        The undersigned understands that tenders of the Pontotoc Shares pursuant to any of the procedures described in "The Offer – Procedure for Tendering" of the Prospectus and in the instructions hereto will constitute a binding agreement between the undersigned and Purchaser upon the terms and subject to the conditions set forth in the Offer, including the undersigned's representation that the undersigned owns the Pontotoc Shares being tendered. Without limiting the foregoing, if the price to be paid in the Offer is amended, the price to be paid to the undersigned will be the amended price notwithstanding the fact that a different price is stated in this Letter of Transmittal. The undersigned recognizes that under certain circumstances set forth in the Prospectus, Purchaser may not be required to accept for payment any of the Pontotoc Shares tendered hereby.

        Unless otherwise indicated herein under "Special Issuance Instructions," the Ascent Energy Preferred Shares and a check for cash and/or any certificates for Pontotoc Shares not tendered or not accepted for exchange will be issued or returned in the name(s) of the registered holder(s) appearing under "Description of Shares Tendered." Similarly, unless otherwise indicated herein under "Special Delivery Instructions," the Ascent Energy Preferred Shares and a check for cash and/or any certificates for Pontotoc Shares not tendered or not accepted for exchange (and any accompanying documents, as appropriate) will be mailed to the address(es) of the registered holder(s) appearing above under "Description of Shares Tendered." In the event that both the "Special Delivery Instructions" and the "Special Issuance Instructions" are completed, the Ascent Energy Preferred Shares and a check for cash and/or certificate(s) for Pontotoc Shares not so tendered or accepted will be returned in the name of, and delivered to, the person or persons so indicated. Unless otherwise indicated herein under "Special Issuance Instructions," any Pontotoc Shares tendered herewith by book–entry transfer that are not accepted for exchange will be credited to the account at the Book–Entry Transfer Facility (as defined herein) designated above. The undersigned recognizes that Purchaser has no obligation, pursuant to the "Special Issuance Instructions," to transfer any Pontotoc Shares from the name(s) of the registered holder(s) thereof if Purchaser does not accept for exchange any or all of the Pontotoc Shares so tendered.

SPECIAL ISSUANCE INSTRUCTIONS
(See Instructions 1, 5, 6 and 7) To be completed ONLY if certificate(s) for the Pontotoc Shares not tendered or not accepted for payment and/or the Ascent Energy Preferred Shares and the check for the purchase price of the Pontotoc Shares accepted for exchange are to be issued in the name of someone other than the undersigned or if the Pontotoc Shares tendered by book–entry transfer which are not accepted for payment are to be returned by credit to an account maintained at a Book–Entry Transfer Facility. Issue:      G check      G certificates to: Name:_______________________________
                                   (Please Print) Address:_____________________________ ____________________________________
                       (Include Zip Code)
____________________________________
             (Tax Id. or Social Security No.)
               (See Substitute Form W–9) G Credit the Pontotoc Shares tendered by book–entry transfer that are not accepted for payment 
to _________.
_________________________________________
(________________ Account No.) SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 1, 5, 6 and 7) To be completed ONLY if certificate(s) for the Pontotoc Shares not tendered or not accepted for payment and/or the Ascent Energy Preferred Shares and the check for the purchase price of the Pontotoc Shares accepted for exchange are to be sent to someone other than the undersigned or to the undersigned at an address other than that shown above.


Mail:      G check      G certificates to: Name:_______________________________
                                   (Please Print) Address:_____________________________ ____________________________________
                       (Include Zip Code)
____________________________________
             (Tax Id. or Social Security No.)
               (See Substitute Form W–9)

SIGN HERE
AND COMPLETE SUBSTITUTE FORM W–9

SIGN HERE __________________________________________________________________________________

SIGN HERE __________________________________________________________________________________

Dated:__________________________________________________________________________________ , 2001
(Must be signed by registered holder(s) exactly as name(s) appear(s) on certificate for the Pontotoc Shares or on a security position listing or by person(s) authorized to become registered holder(s) by certificates and documents transmitted herewith. If signature is by trustees, executors, administrators, guardians, attorneys–in–fact, officers of corporations or others acting in a fiduciary or representative capacity, please provide the following information and see Instruction 5.)

Name(s):____________________________________________________________________________________
                                                                          (Please Print)

Capacity (full title):_____________________________________________________________________________

Address:_____________________________________________________________________________________

____________________________________________________________________________________________
                                                                       (Include Zip Code)

Area Code and Telephone Number:_________________________________________________________________

Tax Identification or Social Security Number:__________________________________________________________

GUARANTEE OF SIGNATURE(S)
(See Instructions 1 and 5)

Authorized Signature:___________________________________________________________________________

Name:_______________________________________________________________________________________

Name of Firm:__________________________________________________________________________________
                                                                           (Please Print)

Address:_____________________________________________________________________________________
                                                                       (Include Zip Code)

Area Code and Telephone Number:_________________________________________________________________

Dated:_______________________ , 2001

INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer

     1.         Guarantee of Signatures. No signature guarantee is required on this Letter of Transmittal (a) if this Letter of Transmittal is signed by the registered holder(s) (which term, for purposes of this document, shall include any participant in a Book–Entry Transfer Facility whose name appears on a security position listing as the owner of the Pontotoc Shares) of the Pontotoc Shares tendered herewith, unless such holder(s) has completed either the box entitled "Special Issuance Instructions" or the box entitled "Special Delivery Instructions" above, or (b) if such Pontotoc Shares are tendered for the account of a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program (each of the foregoing being referred to as an "Eligible Institution"). In all other cases, all signatures on this Letter of Transmittal must be guaranteed by an Eligible Institution. See Instruction 5 of this Letter of Transmittal.

     2.         Delivery of Letter of Transmittal and Pontotoc Shares; Guaranteed Delivery Procedures. This Letter of Transmittal is to be completed by stockholders of Pontotoc either if Share certificates are to be forwarded herewith or, unless an Agent=s Message is utilized, if delivery of the Pontotoc Shares is to be made by book–entry transfer pursuant to the procedures set forth herein and in "The Offer – Procedure for Tendering" of the Prospectus. For a stockholder to validly tender Pontotoc Shares pursuant to the Offer, either (a) a properly completed and duly executed Letter of Transmittal (or a properly completed and manually signed facsimile thereof), together with any required signature guarantees or an Agent's Message (in connection with book–entry transfer) and any other required documents, must be received by the Exchange Agent at one of its addresses set forth herein prior to the Expiration Date and either (i) certificates for tendered Pontotoc Shares must be received by the Exchange Agent at one of such addresses prior to the Expiration Date or (ii) Pontotoc Shares must be delivered pursuant to the procedures for book–entry transfer set forth herein and in "The Offer – Procedure for Tendering" of the Prospectus and a Book–Entry Confirmation must be received by the Exchange Agent prior to the Expiration Date or (b) the tendering stockholder must comply with the guaranteed delivery procedures set forth herein and in "The Offer – Guaranteed Delivery" of the Prospectus.

        Stockholders whose certificates for Pontotoc Shares are not immediately available or who cannot deliver their certificates for the Pontotoc Shares and all other required documents to the Exchange Agent prior to the Expiration Date or who cannot comply with the book–entry transfer procedures on a timely basis may tender their Pontotoc Shares by properly completing and duly executing the Notice of Guaranteed Delivery pursuant to the guaranteed delivery procedure set forth herein and "The Offer – Guaranteed Delivery" of the Prospectus.

        Pursuant to such guaranteed delivery procedures, (i) such tender must be made by or through an Eligible Institution, (ii) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form provided by Purchaser, must be received by the Exchange Agent prior to the Expiration Date and (iii) the certificates for all tendered Pontotoc Shares, in proper form for transfer (or a Book–Entry Confirmation with respect to all tendered Pontotoc Shares), together with a properly completed and duly executed Letter of Transmittal (or a properly completed and manually signed facsimile thereof), with any required signature guarantees, or, in the case of a book–entry transfer, an Agent's Message, and any other required documents must be received by the Exchange Agent within three Nasdaq trading days after the date of execution of such Notice of Guaranteed Delivery. A "trading day" is any day on which the Nasdaq is open for business.

        The term "Agent's Message" means a message, transmitted by the Book–Entry Transfer Facility to, and received by, the Exchange Agent and forming a part of a Book–Entry Confirmation, which states that such Book–Entry Transfer Facility has received an express acknowledgment from the participant in such Book–Entry Transfer Facility tendering the Pontotoc Shares, that such participant has received and agrees to be bound by the terms of the Letter of Transmittal and that Purchaser may enforce such agreement against the participant.

        The signatures on this Letter of Transmittal cover the Pontotoc Shares tendered hereby.

        THE METHOD OF DELIVERY OF PONTOTOC SHARES, THIS LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK–ENTRY TRANSFER FACILITY, IS AT THE ELECTION AND RISK OF THE TENDERING STOCKHOLDER. PONTOTOC SHARES WILL BE DEEMED DELIVERED ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT (INCLUDING, IN THE CASE OF A BOOK–ENTRY TRANSFER, BY BOOK–ENTRY CONFIRMATION). IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.

     No alternative, conditional or contingent tenders will be accepted, and no fractional Pontotoc Shares will be purchased. All tendering stockholders, by executing this Letter of Transmittal (or facsimile thereof) waive any right to receive any notice of acceptance of their Pontotoc Shares for payment.

     3.         Inadequate Space. If the space provided herein is inadequate, the certificate numbers and/or the number of Pontotoc Shares and any other required information should be listed on a separate signed schedule attached hereto.

        4.        Partial Tenders. (Not Applicable to Book–Entry Stockholders.) If fewer than all the Pontotoc Shares evidenced by any share certificate submitted are to be tendered, fill in the number of Pontotoc Shares which are to be tendered in the box entitled "Number of Shares Tendered" under "Description of Shares Tendered." In such cases, new certificates for the remainder of Pontotoc Shares that were evidenced by your old certificates, but were not tendered by you, will be sent to you, unless otherwise provided in the appropriate box on this Letter of Transmittal, as soon as practicable after the Expiration Date or the termination of the Offer. All shares represented by share certificates delivered to the Exchange Agent will be deemed to have been tendered unless otherwise indicated.

        5.         Signatures on Letter of Transmittal, Stock Powers and Endorsements. If this Letter of Transmittal is signed by the registered holder(s) of the Pontotoc Shares tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the certificate(s) without alteration, enlargement or any change whatsoever.

           If any of the Pontotoc Shares tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal.

           If any of the tendered Pontotoc Shares are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of certificates.

          If this Letter of Transmittal or any Share certificate or stock power is signed by a trustee, executor, administrator, guardian, attorney–in–fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence satisfactory to Purchaser of the authority of such person so to act must be submitted.

          If this Letter of Transmittal is signed by the registered holder(s) of the Pontotoc Shares listed and transmitted hereby, no endorsements of certificates or separate stock powers are required unless payment is to be made to or certificates for Pontotoc Shares not tendered or not purchased are to be issued in the name of a person other than the registered holder(s). Signatures on such certificates or stock powers must be guaranteed by an Eligible Institution.

          If this Letter of Transmittal is signed by a person other than the registered holder(s) of the certificates(s) listed, the certificate(s) must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered holder(s) appear on the certificate(s). Signatures on such certificates or stock powers must be guaranteed by an Eligible Institution.

     6.         Stock Transfer Taxes. Except as otherwise provided in this Instruction 6, Purchaser will pay any stock transfer taxes with respect to the transfer and sale of Pontotoc Shares to it or its order pursuant to the Offer. If, however, payment of the purchase price is to be made to, or if certificate(s) for Pontotoc Shares not tendered or accepted for payment are to be registered in the name of, any person other than the registered holder(s), or if tendered certificate(s) are registered in the name of any person other than the person(s) signing this Letter of Transmittal, the amount of any stock transfer taxes (whether imposed on the registered holder(s) or such person) payable on account of the transfer to such person will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes or an exemption therefrom, is submitted.

        EXCEPT AS OTHERWISE PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATE(S) LISTED IN THIS LETTER OF TRANSMITTAL.

     7.        Special Issuance and Delivery Instructions. If Ascent Energy Preferred Shares and a check is to be issued in the name of, and/or certificates for Pontotoc Shares not tendered or not accepted for exchange are to be issued or returned to, a person other than the signer of this Letter of Transmittal or if a check and/or such certificates are to be returned to a person other than the person(s) signing this Letter of Transmittal or to an address other than that shown in this Letter of Transmittal, the appropriate boxes on this Letter of Transmittal must be completed. A Book–Entry Stockholder may request that Pontotoc Shares not accepted for payment be credited to such account maintained at a Book–Entry Transfer Facility as such Book–Entry Stockholder may designate under "Special Issuance Instructions." If no such instructions are given, such Pontotoc Shares not accepted for payment will be returned by crediting the account at the Book–Entry Transfer Facility designated above.

        8.       Waiver of Conditions. Subject to the terms and conditions of the Merger Agreement (as defined in the Prospectus) Purchaser reserves the right to waive, at any time or from time to time, any of the specified conditions of the Offer (other than the minimum tender condition and the conditions relating to the absence of an injunction and the effectiveness of the registration statement for the Ascent Energy Preferred Shares to be issued in the Offer) in whole or in part in the case of any Pontotoc Shares tendered.

         9.        31% Backup Withholding; Substitute Form W–9. Under U.S. Federal income tax law, a stockholder whose tendered Pontotoc Shares are accepted for payment is required to provide the Exchange Agent with such stockholder=s correct taxpayer identification number ("TIN") on Substitute Form W–9 below. If the Exchange Agent is not provided with the correct TIN, the Internal Revenue Service may subject the stockholder or other payee to a $50 penalty. In addition, payments that are made to such stockholder or other payee with respect to the Pontotoc Shares purchased pursuant to the Offer may be subject to 31% backup withholding.

        Certain stockholders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. In order for a foreign individual to qualify as an exempt recipient, the stockholder must submit a Form W–8, signed under penalties of perjury, attesting to that individual=s exempt status. A Form W–8 can be obtained from the Exchange Agent. See the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W–9" for more instructions.

        If backup withholding applies, the Exchange Agent is required to withhold 31% of any such payments made to the stockholder or other payee. Backup withholding is not an additional tax. Rather, the tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service.

        The box in Part 3 of the Substitute Form W–9 may be checked if the tendering stockholder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 3 is checked, the stockholder or other payee must also complete the "Certificate of Awaiting Taxpayer Identification Number" below in order to avoid backup withholding. Notwithstanding that the box in Part 3 is checked and the "Certificate of Awaiting Taxpayer Identification Number" is completed, the Exchange Agent will withhold 31% of all payments made prior to the time a properly certified TIN is provided to the Exchange Agent.

        The stockholder is required to give the Exchange Agent the TIN (e.g., social security number or employer identification number) of the record owner of the Pontotoc Shares or of the last transferee appearing on the transfers attached to, or endorsed on, the Pontotoc Shares. If the Pontotoc Shares are in more than one name or are not in the name of the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute form W–9" for additional guidance on which number to report.

     10.         Requests for Assistance or Additional Copies. Questions or requests for assistance may be directed to the Information Agent at its address and telephone number set forth below. Additional copies of the Prospectus, this Letter of Transmittal and the Notice of Guaranteed Delivery may also be obtained from the Information Agent or from brokers, dealers, commercial banks or trust companies.

         11.         Lost, Destroyed or Stolen Certificates. If any certificate representing Pontotoc Shares has been lost, destroyed or stolen, the stockholder should promptly notify Pontotoc's transfer agent, Corporate Stock Transfer, at (303) 282–4800. The stockholder will then be instructed as to the steps that must be taken in order to replace the certificate. This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost or destroyed certificates have been followed.

        Important: This Letter of Transmittal (or a facsimile hereof), together with certificates or confirmation of Book–Entry Transfer or the Notice of Guaranteed Delivery, and all other required documents, must be received by the Exchange Agent prior to the Expiration Date.

PAYER=S NAME:      Mellon Investor Services LLC
Substitute Form W–9 Department of the Treasury Internal Revenue Service. Payee=s Request for Taxpayer Identification Number (ATIN@) Sign Here	Part 1 - PLEASE PROVIDE YOUR TIN IN THE BOX AT RIGHT AND CERTIFY BY SIGNING AND DATING BELOW:	Social Security Number or Employer Identification Number _____________________________
	Part 2 - Certification –– Under the penalties of perjury, I certify that: (1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me), and (2) I am not subject to backup withholding because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (the AIRS@) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding. CERTIFICATION INSTRUCTIONS –– You must cross out item (2) above if you have been notified by the IRS that you are currently subject to backup withholding because of under–reporting interest or dividends on your tax return. However, if after being notified by the IRS that you were subject to backup withholding you received another notification from the IRS that you were not subject to backup withholding, do not cross out such item (2).
	Signature____________________________ Date ________________________, 2001	Part 3 –– Awaiting TIN G

NOTE:    FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W–9 FOR ADDITIONAL DETAILS.

YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX
IN PART 3 OF THE SUBSTITUTE FORM W–9.

         CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER      

              I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office, or (2) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number by the time of payment, 31% of all reportable payments made to me will be withheld.

Signature ___________________________________                        Date _________________________________ , 2001

The Information Agent for the Offer is:

Innisfree M&A Incorporated

501 Madison Avenue, 20^th Floor
New York, New York 10022
Banks and Brokers Call Collect: (212) 750–5833
All Others Call Toll–free (888) 750–5834

EX-99

Exhibit 99.2

NOTICE OF GUARANTEED DELIVERY
to
Tender Shares of Common Stock
of
Pontotoc Production, Inc.
to
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.
(Not to be used for Signature Guarantees)

        As set forth in "The Offer – Guaranteed Delivery" of the Prospectus described below, this instrument or one substantially equivalent hereto must be used to accept the Offer (as defined below) if certificates representing shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"), are not immediately available or if the procedure for delivery by book–entry transfer cannot be completed on a timely basis, or if time will not permit all required documents to reach the Exchange Agent on a timely basis. This instrument may be delivered by hand or transmitted by facsimile transmission or mailed to the Exchange Agent.

The Exchange Agent for the Offer is:

MELLON INVESTOR SERVICES LLC

Facsimile (for eligible institutions only):

(201) 296–4293

Confirm facsimile by telephone ONLY:

(201) 296–4860

By Mail: Reorganization Department 
P.O. Box 3301 
South Hackensack, NJ 07606 By Hand:  Reorganization Department 
120 Broadway
13^th Floor
New York, NY 10271 By Overnight: Reorganization Department
85 Challenger Road
Mail Drop – Reorg
Ridgefield Park, NJ 07660

        DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.

     This form is not to be used to guarantee signatures. If a signature on a Letter of Transmittal is required to be guaranteed by an Eligible Institution under the instructions thereto, such signature guarantee must appear in the applicable space provided in the signature box in the Letter of Transmittal.

        The Eligible Institution that completes this form must communicate the guarantee to the Exchange Agent and must deliver the Letter of Transmittal and certificates for Pontotoc Shares to the Exchange Agent within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution.

Ladies and Gentlemen:

        The undersigned hereby tender(s) to Pontotoc Acquisition Corp., a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation, upon the terms and subject to the conditions set forth in the Prospectus dated ________, 2001 (the "Prospectus"), and in the related Letter of Transmittal (which, together with the Prospectus, and as amended from time to time, constitute the "Offer"), receipt of which is hereby acknowledged, the number of shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation, pursuant to the guaranteed delivery procedure set forth in "The Offer – Guaranteed Delivery" in the Prospectus.

Signature(s):	Address(es):
Name(s) of Record Holders:   ____________________________________                                           Please Type or Print	Zip Code: ________________________________
	Area Code and Tel No(s):
Number of Shares:
Certificate Nos. (If Available) ______________________________________ ______________________________________	Check box if Shares will be       tendered by book–entry transfer G
	Account Number:

Dated:                                                     , 2001

GUARANTEE
(Not to be used for signature guarantee)

     The undersigned, a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program (an "Eligible Institution" as defined in Rule 17Ad–15 under the Securities Exchange Act of 1934, as amended), guarantees to deliver to the Exchange Agent either certificates representing all tendered Pontotoc Shares, in proper form for transfer, or confirmation of book–entry transfer of such Pontotoc Shares into the Exchange Agent's account at The Depository Trust Company, in either case with delivery of the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees or an Agent's Message (as defined in the Prospectus) and any other required documents, all within three Nasdaq Stock Market trading days after the date hereof.

        The Eligible Institution that completes this form must communicate the guarantee to the Exchange Agent and must deliver the Letter of Transmittal and certificates for Pontotoc Shares to the Exchange Agent within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution.

______________________________________                     __________________________________________
                              Name of Firm                                                                                           Authorized Signature

______________________________________                     Name:                                                                                          
                          Address                                                                                               Please Type or Print

______________________________________                    Title:                                                                                              
                          Zip Code

______________________________________                     Dated:                                                                              , 2001
               Area Code and Tel. No.

NOTE:    DO NOT SEND CERTIFICATES FOR PONTOTOC SHARES OR WITH THIS NOTICE. CERTIFICATES FOR PONTOTOC SHARES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.

EX-99

Exhibit 99.3

OFFER TO EXCHANGE

Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON _______, 2001
UNLESS THE OFFER IS EXTENDED

To Brokers, Dealers, Commercial Banks,                                                                                                  ____________, 2001
     Trust Companies and Other Nominees:

        We have been appointed by Pontotoc Acquisition Corp. ("Purchaser"), a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation ("Ascent Energy"), to act as Exchange Agent in connection with Purchaser's offer to acquire all the outstanding shares of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"). Purchaser has offered to exchange $9.00 in cash and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.001 per share, having a liquidation value of $2.50 per share (the "Ascent Energy Preferred Shares"), for each outstanding Pontotoc Share, upon the terms and subject to the conditions set forth in the Prospectus dated ___________, 2001 (the "Prospectus") and in the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") enclosed herewith. The Offer is being made in connection with the Agreement and Plan of Merger, dated as January 19, 2001 (the "Merger Agreement"), among Ascent Energy, Purchaser and Pontotoc. The Merger Agreement provides, among other things, that following the completion of the Offer and the satisfaction or waiver, if permissible, of all conditions set forth in the Merger Agreement and in accordance with the General Corporation Law of the State of Nevada, Purchaser will be merged with Pontotoc (the "Merger"). Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Pontotoc Shares registered in your name or in the name of your nominee.

        The Offer is subject to several conditions set forth in the Prospectus, which you should review in detail.

        Enclosed herewith for your information and forwarding to your clients are copies of the following documents:

        1.         Prospectus, dated ________, 2001.

     2.         The Letter of Transmittal to tender Pontotoc Shares for your use and for the information of your clients. Facsimile copies of the Letter of Transmittal may be used to tender the Pontotoc Shares.

     3.         The Notice of Guaranteed Delivery for Pontotoc Shares to be used to accept the Offer if certificates for Pontotoc Shares are not immediately available or if such certificates and all other required documents cannot be delivered to Mellon Investor Services LLC (the "Exchange Agent") by the Expiration Date or if the procedure for book–entry transfer cannot be completed by the Expiration Date.

        4.         Pontotoc's Solicitation/Recommendation Statement on Schedule 14D–9, which includes the recommendation of Pontotoc's Board of Directors that stockholders accept the Offer and tender their Pontotoc Shares to Purchaser pursuant to the Offer.

        5.         A printed form of letter which may be sent to your clients for whose accounts you hold Pontotoc Shares registered in your name or in the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Offer.

     6.       Guidelines for Certification of Taxpayer Identification Number on Substitute Form W–9. Stockholders who fail to complete and sign the Substitute Form W–9 may be subject to a required federal backup withholding tax of 31% of the gross proceeds payable to such stockholder or other payee pursuant to the Offer.

    YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON _____________, 2001, UNLESS THE OFFER IS EXTENDED.

     Pontotoc's Board of Directors has approved by unanimous vote the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger. Pontotoc's board of directors has also determined that the terms of the Offer and the Merger are fair to, and in the best interest of, the holders of the Pontotoc Shares and recommends that the holders of the Pontotoc Shares accept the Offer and tender to Purchaser pursuant to the Offer.

     Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment), Purchaser will accept for exchange Pontotoc Shares which are validly tendered and not withdrawn when, as and if Purchaser gives oral or written notice to the Exchange Agent of Purchaser's acceptance of such Pontotoc Shares for exchange pursuant to the Offer. Payment of cash and issuance of Ascent Energy Preferred Shares for Pontotoc Shares exchanged pursuant to the Offer will in all cases be made only after timely receipt by the Exchange Agent of (i) certificates for such Pontotoc Shares, or timely confirmation of a book–entry transfer of such Pontotoc Shares into the Exchange Agent's account at The Depository Trust Company, pursuant tot the procedures described in "The Offer – Procedure for Tendering" of the Prospectus, (ii) a properly completed and duly executed Letter of Transmittal (or a properly completed and manually signed facsimile thereof) or an Agent's Message (as defined in the Prospectus) in connection with a book–entry transfer and (iii) all other documents required by the Letter of Transmittal.

     In order to take advantage of the Offer, (i) a duly executed and properly completed Letter of Transmittal and any required signature guarantees, or an Agent=s Message (as defined in the Prospectus) in connection with a book–entry delivery of Pontotoc Shares, and other required documents should be sent to the Exchange Agent, and (ii) either certificates representing the tendered Pontotoc Shares should be delivered to the Exchange Agent, or such Pontotoc Shares should be tendered by book–entry transfer into the Exchange Agent's account maintained at one of the Book–Entry Transfer Facilities (as described in the Prospectus), all in accordance with the instructions set forth in the Letter of Transmittal and the Prospectus.

     If holders of Pontotoc Shares wish to tender, but it is impracticable for them to forward their certificates or other required documents on or prior to the expiration of the Offer or to comply with the book–entry transfer procedures on a timely basis, a tender may be effected by following the guaranteed delivery procedures specified in "The Offer – Guaranteed Delivery" of the Prospectus.

     Purchaser will not pay any commissions or fees to any broker, dealer or other person (other than the Exchange Agent and Innisfree M&A Incorporated (the "Information Agent") (as described in the Prospectus)) for soliciting tenders of Pontotoc Shares pursuant to the Offer. Purchaser will, however, upon request, reimburse you for customary clerical and mailing expenses incurred by you in forwarding any of the enclosed materials to your clients. Purchaser will pay or cause to be paid any stock transfer taxes payable on the transfer of Pontotoc Shares to it, except as otherwise provided in Instruction 6 of the Letter of Transmittal.

     Inquiries you may have with respect to the Offer should be addressed to the Information Agent or the undersigned, at the respective addresses and telephone numbers set forth on the back cover of the Prospectus. Additional copies of the enclosed materials may be obtained from the Information Agent.

Very truly yours,

                                                                       ______________________________

NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF ASCENT ENERGY, PURCHASER, PONTOTOC, THE EXCHANGE AGENT OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.

EX-99

Exhibit 99.4

OFFER TO EXCHANGE

Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by
Pontotoc Acquisition Corp.
a wholly owned subsidiary
of
Ascent Energy Inc.

THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON _______, 2001,
UNLESS THE OFFER IS EXTENDED.

To Our Clients:

     Enclosed for your consideration are the Prospectus dated ________, 2001 (the "Prospectus") and the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer") in connection with the offer by Pontotoc Acquisition Corp. ("Purchaser"), a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation ("Ascent Energy"), to exchange $9.00 in cash and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.001 per share, having a liquidation value of $2.50 (the "Ascent Energy Preferred Shares"), for each outstanding share of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation ("Pontotoc"). The Offer is being made in connection with the Agreement and Plan of Merger, dated as of January 19, 2001 (the "Merger Agreement"), among Ascent Energy, Purchaser and Pontotoc. The Merger Agreement provides, among other things, that following the completion of the Offer and the satisfaction or waiver, if permissible, of all conditions set forth in the Merger Agreement and in accordance with the General Corporation Law of the State of Nevada, Purchaser will be merged with Pontotoc (the "Merger"). Holders of Pontotoc Shares whose certificates for such Pontotoc Shares are not immediately available or who cannot deliver their certificates for Pontotoc Shares and all other required documents to the Exchange Agent (as defined below) prior to the Expiration Date (as defined in the Prospectus), or who cannot complete the procedures for book–entry transfer on a timely basis, must tender their Pontotoc Shares according to the guaranteed delivery procedures set forth in "The Offer – Guaranteed Delivery" of the Prospectus.

     We are the holder of record (directly or indirectly) of Pontotoc Shares held by us for your account. A tender of such Pontotoc Shares can be made only by us as the holder of record and pursuant to your instructions. The enclosed Letter of Transmittal is furnished to you for your information only and cannot be used by you to tender Pontotoc Shares held by us for your account.

     We request instructions as to whether you wish to have us tender on your behalf any or all of the Pontotoc Shares held by us for your account, pursuant to the terms and subject to the conditions set forth in the Prospectus.

     Your attention is directed to the following:

     1.         The consideration per Pontotoc Share is $9.00 in cash, without interest, and one Ascent Energy Preferred Share having a liquidation value of $2.50.

     2.         The Offer is made for all of the outstanding Pontotoc Shares.

     3.         Pontotoc's board of directors has approved the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger. Pontotoc's board of directors has also determined that the terms of the Offer and the Merger are fair to, and in the best interests of, the holders of the Pontotoc Shares and recommends that holders of the Pontotoc Shares accept the Offer and tender their Pontotoc Shares to Purchaser pursuant to the Offer.

     4.         The Offer is being made pursuant to the Merger Agreement, which provides, among other things, that, subject to the terms and conditions of the Merger Agreement, subsequent to the consummation of the Offer, Purchaser will merge with Pontotoc.

     5.         The Offer and withdrawal rights will expire at 5:00 p.m., New York City time, on _______, 2001, unless the Offer is extended.

     6.         The Offer is conditioned upon, among other things, there being validly tendered and not properly withdrawn prior to the expiration of the Offer that number of Pontotoc Shares which represent not less than two–thirds of the total issued and outstanding Pontotoc Shares on a fully diluted basis. The Offer is subject to various other conditions set forth in the Prospectus, which you should review in detail.

        7.         No public trading market exists for the Ascent Energy Preferred Shares nor the common stock of Ascent Energy into which such shares are convertible. By signing below, you represent that to your reasonable belief, any Ascent Energy Preferred Shares acquired through the exchange of your Pontotoc Shares will be acquired for investment purposes only, for your own account or for the account of the person for whom or the entity for which you acts as a fiduciary, and not with a view to the sale or resale, distribution or transfer thereof.

        8.         Tendering stockholders will not be obligated to pay brokerage fees or commission or, except as set forth in Instruction 6 of the Letter of Transmittal, stock transfer taxes on the purchase of shares pursuant to the Offer.

   Except as disclosed in the Prospectus, Purchaser is not aware of any state in which the making of the Offer is prohibited by administrative or judicial action pursuant to any valid state statute. In any jurisdiction in which the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer will be deemed to be made on behalf of Purchaser by one or more registered brokers or dealers licensed under the laws of such jurisdiction.

     IF YOU WISH TO HAVE US TENDER ANY OR ALL OF THE PONTOTOC SHARES HELD BY US FOR YOUR ACCOUNT, PLEASE INSTRUCT US BY COMPLETING, EXECUTING AND RETURNING TO US THE INSTRUCTION FORM CONTAINED IN THIS LETTER. IF YOU AUTHORIZE A TENDER OF YOUR PONTOTOC SHARES, ALL SUCH PONTOTOC SHARES WILL BE TENDERED UNLESS OTHERWISE SPECIFIED IN SUCH INSTRUCTION FORM. YOUR INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER.

Instructions with Respect to
the Offer to Exchange
Each Outstanding Share of Common Stock
of
Pontotoc Production, Inc.
for
$9.00 in Cash
and
One Share of 8% Series B Convertible Preferred Stock
of
Ascent Energy Inc.
having a Liquidation Value of $2.50 per Share
by Pontotoc Acquisition Corp.

     The undersigned acknowledge(s) receipt of your letter enclosing the Prospectus dated ________, 2001 (the "Prospectus") and the related Letter of Transmittal in connection with the offer by Pontotoc Acquisition Corp., a Nevada corporation and a wholly owned subsidiary of Ascent Energy Inc., a Delaware corporation, to exchange $9.00 in cash and one share of Ascent Energy's 8% Series B Convertible Preferred Stock, par value $0.001 per share, having a liquidation value of $2.50, for each outstanding share of Common Stock, par value $0.0001 per share (the "Pontotoc Shares"), of Pontotoc Production, Inc., a Nevada corporation, upon the terms and subject to the conditions set forth in the Prospectus and the related Letter of Transmittal.

     This will instruct you to tender the number of Pontotoc Shares indicated below (or, if no number is indicated below, all Pontotoc Shares which are held by you for the account of the undersigned), upon the terms and subject to the conditions set forth in the Prospectus and in the related Letter of Transmittal furnished to the undersigned.

Number of Pontotoc Shares                                                                                                    SIGN HERE
          to be Tendered*
___________________Shares                                                                                                                                                              

Dated __________ , 2001                                                                                                                                                         
                                                                                                                                                       Signature(s)

                                                                                                                                                                                                          
                                                                                                                                              Please Print Name(s)

                                                                                                                                                                                                          
                                                                                                                                                         Address

                                                                                                                                                                                                          
                                                                                                                                   Area Code and Telephone Number

                                                                                                                        ___________________________________
                                                                                                                                                 Tax Identification or
                                                                                                                                               Social Security Number

_________________

*    Unless otherwise indicated, it will be assumed that all of your Pontotoc Shares held by us for your account are to be     tendered.

PLEASE RETURN THIS FORM TO THE BROKERAGE FIRM MANAGING YOUR ACCOUNT.

EX-99

Exhibit 99.5

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W–9

Guidelines for Determining the Proper Identification Number to Give the Payer B Social Security numbers have nine digits separated by two hyphens: i.e., 000–00–0000. Employer identification numbers have nine digits separated by only one hyphen: i.e., 00–0000000. The table below will help determine the number to give the payer.

For this type of account:		Give the SOCIAL SECURITY number of B		For this type of account:	Give the EMPLOYER IDENTIFICATION number of B
1.	An individual=s account	The individual	9.	A valid trust, estate or pension trust	The legal entity (Do not furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title.)5
2.	Two or more individuals (joint account)	The actual owner of the account or, if combined funds, the first individual on the account1	10.	Corporate account	The corporation
3.	Husband and wife (joint account)	The actual owner of the account, or, if joint funds, either person1	11.	Religious, charitable, or educational organization account	The organization
4.	Custodian account of a minor (Uniform Gift to Minors Act)	The minor2	12.	Partnership account held in the name of the partnership	The partnership
5.	Adult and minor (joint account)	The adult or, if the minor is the only contributor, the minor1	13.	Association, club, or other tax–exempt organization	The organization
6.	Account in the name of guardian or committee for a designated ward, minor or incompetent person	The ward, minor, or incompetent person3	14.	A broker or registered nominee	The broker or nominee
7.	a.   The usual revocable savings trust account (grantor is also trustee) b.   So–called trust account that is not a legal or valid trust under State law	The grantor–trustee1 The actual owner1	15.	Account with the Department of Agriculture in the name of a public entity (such as a State or local government, school district, or prison) that receives agricultural program payments	The public entity
8.	Sole proprietorship account	The owner4

_______________________________________________________             ___________________________________

1     List first and circle the name of the person whose number you furnish.

2     Circle the minor=s name and furnish the minor=s social security number.

3     Circle the ward=s, minor=s or incompetent person=s name and furnish such person=s social security number.

4     Show your individual name. You may also enter your business name. You may use either your Social Security Number or your Employer Identification Number.

5     List first and circle the name of the legal trust, estate, or pension trust.

NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed.

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W–9
PAGE 2

Obtaining a Number

If you do not have a taxpayer identification number or you don=t know your number, obtain Form SS–5, Application for a Social Security Number Card (for individuals), or Form SS–4, Application for Employer Identification Number (for businesses and all other entities), at the local office of the Social Security Administration or the Internal Revenue Service (the AIRS@) and apply for a number.

Payees Exempt from Backup Withholding Payees specifically exempted from backup withholding on ALL payments include the following:
$ A corporation.
$ A financial institution.
$ An organization exempt from tax under Section 501(a) of the Internal Revenue Code of 1986, as amended (the ACode@), or an individual retirement plan.
$ The United States or any agency or instrumentalities.
$ A State, the District of Columbia, a possession of the United States, or any subdivision or instrumentality.
$ A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof.
$ An international organization or any agency or instrumentality thereof.
$ A registered dealer in securities or commodities registered in the U.S. or a possession of the U.S.
$ A real estate investment trust.
$ A common trust fund operated by a bank under Section 584(a) of the Code.
$ An exempt charitable remainder trust, or non–exempt trust described in Section 4947(a)(1) of the Code.
$ An entity registered at all times under the Investment Company Act of 1940.
$ A foreign central bank of issue. Payments of dividends and patronage dividends not generally subject to backup withholding include the following:
  $ Payments to nonresident aliens subject to withholding under Section 1441 of the Code.
  $ Payments to partnerships not engaged in a trade or business in the U.S. and which have at least one nonresident partner.
  $ Payments of patronage dividends where the amount
received is not paid in money.
  $ Payments made by certain foreign organizations.
  $ Payments made to a certain nominee. Payments of interest not generally subject to backup withholding include the following:
  $ Payments of interest on obligations issued by individuals.
    Note:     You may be subject to backup withholding if this  interest is $600 or more and is paid in the course of the payer=s trade or business and you have   not provided your correct taxpayer identification number to the payer.
  $ Payments of tax–exempt interest (including exempt–interest dividends under Section 852 of the Code).
  $ Payments described in Section 6049(b)(5) of the Code to nonresident aliens.
  $ Payments on tax–free covenant bonds under Section 1451 of the Code.
  $ Payments made by certain foreign organizations.
  $ Payments made to a nominee.

Exempt payees described above should file a Form W–9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE AEXEMPT@ ON THE FACE OF THE FORM, SIGN AND DATE THE FORM AND RETURN IT TO THE PAYER. IF YOU ARE A NONRESIDENT ALIEN OR A FOREIGN ENTITY NOT SUBJECT TO BACKUP WITHHOLDING, FILE WITH PAYER A COMPLETED INTERNAL REVENUE FORM W–8 (CERTIFICATE OF FOREIGN STATUS).          Certain payments other than interest, dividends and patronage dividends, that are not subject to information reporting are also not subject to backup withholding. For details, see Sections 6041, 6041A(a), 6045, 6050A and 6050N of the Code and the regulations promulgated therein.

Privacy Act Notice B Section 6109 requires most recipients of dividend, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to the IRS. The IRS uses the numbers for identification purposes. Payers must be given the numbers whether or not recipients are required to file tax returns. Payers must generally withhold 31% of taxable interest, dividends and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply.
Penalties
(1) Penalty for Failure to Furnish Taxpayer Identification Number B If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect.
(2) Civil Penalty for False Information with Respect to Withholding B If you make a false statement with no reasonable basis that results in no imposition of backup withholding, you are subject to a penalty of $500.
(3) Criminal Penalty for Falsifying Information B Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION, CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE.

EX-99

Exhibit 99.6

January 10, 2001

Mr. Jeffrey Clark
Ascent Energy Inc.
c/o 201 St. Charles Ave.
Suite 5100
New Orleans, Louisiana 70170–5100

Dear Jeff:

Pursuant your request and our ongoing discussions regarding the provision of a new Senior Revolving Credit Facility for Ascent Energy Inc., we are pleased to commit USD 40 million with an initial Borrowing Base of USD 30 million for the purposes of providing a portion of the capital necessary to acquire the outstanding shares of Forman Petroleum Corp. and Pontotoc Production, Inc. ("Pontotoc") and for ongoing oil and gas development support.

A definitive Credit Agreement governing the subject Credit Facility, the basis of which is outlined in the Summary of Terms and Conditions attached to this letter as Addendum I, shall be completed between Fortis, you and other relevant parties associated with the subject transaction over the coming weeks.

We emphasize that our commitment represents a commitment from our institution and does not in any way include a commitment or other arrangements from any other non–affiliated institution.

Once again Jeff, it is our pleasure to provide the subject Senior Revolving Credit Facility. If you are in agreement with the attached Summary of Terms and Conditions, please indicate your acknowledgment and acceptance by executing this letter via signature in the space provided below. As always, please do not hesitate to contact me with any questions or comments you may have.

Very truly yours,

/s/ Darrell W. Holley
Darrell W. Holley
Managing Director
Fortis Capital Corp /s/ Deirdre M. Sanborn
Deirdre M. Sanborn
Vice President
Fortis Capital Corp.

AGREED AND ACCEPTED:                         /s/ Jeffrey Clarke                         DATE: _____________

By:                         Jeffrey Clark                                           
Title:                     President                                                

ASCENT ENERGY INC.
USD 40,000,000 SENIOR SECURED CREDIT FACILITY

Summary of Terms and Conditions

BORROWER:	Ascent Energy Inc.
ARRANGER / ADMINISTRATIVE AGENT	Fortis Capital Corp. ("Fortis")
LENDERS:	A syndicate of financial institutions (including Fortis) arranged by Fortis. These institutions shall be acceptable to Borrower and Administrative Agent .

FACILITY:	A senior secured revolving credit facility (the "Credit Facility") under which availability shall be limited to the lesser of (a) USD 40,000,000, or (b) the Borrowing Base in effect from time to time.
PURPOSE:	The proceeds of the Credit Facility shall be used (a) to provide a portion of the funds necessary to acquire the stock and associated assets of Pontotoc Production Inc., (b) to finance the future acquisition and development of oil and gas properties (c) to refinance existing debt of Pontotoc Production Inc., and (d) for ongoing liquidity needs.
MATURITY:	The Credit Facility shall terminate and all amounts outstanding shall be due and payable (3) years from the date of Closing (the "Maturity Date").
AVAILABILITY:	USD 30 million will be available at Closing based on the Initial Borrowing Base threshold. Borrower may borrow, repay and re–borrow on a revolving basis until the Maturity Date.
BORROWING BASE	The initial Borrowing Base will be USD 30 million.
	The Borrowing Base will be redetermined semi–annually by Lenders in their sole reasonable discretion throughout the duration of the Credit Facility, based on annual third party and semi–annual in house engineering provided by Borrower – all of which shall be acceptable to Administrative Agent. Any change in the Borrowing Base and or the amortization resulting from a redetermination (including any unscheduled redetermination referenced in the next succeeding paragraph) shall be approved by all Lenders. Any reduction in availability under the Borrowing Base shall be due within 90 days
	Lenders and Borrower shall each have the right to request one unscheduled redetermination of the Borrowing Base during each period of twelve consecutive months, provided that any such redetermination made by Lenders shall utilize Lender's standard methodology and criteria for transactions of this nature.
	A borrowing base deficiency will exist if the amount outstanding under the Credit Facility exceeds the Borrowing Base in effect at any time. Any deficiency must be eliminated, at Borrower's option, in either (a) a single lump sum, or (b) three equal monthly installments.
AMORTIZATION:	Interest payable quarterly in arrears, principal due at maturity.
SECURITY:	The Credit Facility shall be secured by all of the common shares of Forman Petroleum Corp. and Pontotoc Production Inc. owned (to be owned) by the Borrower and a first priority mortgage lien on existing and future acquired oil and gas properties and other rights/assets owned by Borrower and evaluated for purposes of the Borrowing Base. These mortgages shall cover such portion of the Borrower's Oil and Gas Properties which, in the aggregate, have a value (present value discounted at 10%) equal to a minimum of 85% of the total value of the Oil and Gas Properties included in the effective Borrowing Base, at all times.
	Borrower shall agree to deliver to Administrative Agent on behalf of Lenders deeds of trust, mortgages, chattel mortgages, security agreements, financing statements and other Security Documents in form and substance satisfactory to Administrative Agent for the purposes of granting, confirming and perfecting first and prior liens or security interests in any real property now owned or hereafter acquired by the Borrower or any current or future Subsidiary. Furthermore, Borrower agrees to deliver favorable title opinions from legal counsel acceptable to Administrative Agent with respect to Borrowers oil and gas properties and interests, based upon abstract or record examinations to dates acceptable to Administrative Agent and (i) stating that Borrower has good and defensible title to such properties and interests, free and clear of all Liens other than Permitted Liens (as shall be defined in the Credit Agreement governing this Facility); and (ii) confirming that such properties and interests are subject to Security Documents securing the Obligations that constitute and create legal, valid and duly perfected first deed of trust or mortgage liens in such properties and interests and first priority assignments of and security interests in the oil and gas attributable to such properties and interests and the proceeds thereof.
	Borrower shall have 60 days from closing to complete title work on oil and gas properties and other assets owned by Borrower, as utilized and considered in the determination of the effective Borrowing Base. Upon satisfactory completion of all required title work and the filing of all required mortgage documentation, in the Lender's sole discretion, Administrative Agent, on behalf of Lenders shall release the common shares of Forman Petroleum Corp. and Pontotoc Production Inc. owned (to be owned) by the Borrower as security for the subject Facility.
	The foregoing collateral shall ratably secure the Credit Facility and any commodity swap, interest rate swap or similar agreements with a Lender under the Credit Facility.
OPTIONAL PREPAYMENTS AND COMMITMENT REDUCTIONS:	Borrower may prepay the Credit Facility in whole or in part at any time without penalty, subject to reimbursement of the Lenders' breakage and redeployment costs in the case of prepayment of LIBOR borrowings.
CONDITIONS PRECEDENT TO CLOSING:	The initial funding of the Credit Facility will be subject to satisfaction of the conditions precedent deemed appropriate by Administrative Agent and the Lenders including, but not limited to, the following:
	Administrative Agent shall have received a fully executed copy of the Agreement and Plan of Merger governing the acquisition of Pontotoc Production Inc. and all relevant documentation relating to the acquisition and consolidation of Forman Petroleum Corp. by Borrower, along with all amendments thereto. Additionally, Administrative Agent shall have received all other material documents outside of the Agreement and Plan of Merger executed and/or delivered by Borrower and/or Forman Petroleum Corp. and Pontotoc Production Inc. in connection with any of the foregoing and the closing of the Forman Petroleum Corp. and Pontotoc Production Inc. acquisitions.
	Administrative Agent shall have confirmed completion of all material terms and conditions outlined in the Agreement and Plan of Merger governing the acquisition of Pontotoc Production Inc. and all relevant documentation relating to the acquisition and consolidation of Forman Petroleum Corp. by Borrower. The material Terms and Conditions of the Agreement and Plan of Merger governing the acquisition of Pontotoc Production Inc. and all relevant documentation relating to the acquisition and consolidation of Forman Petroleum Corp. by Borrower shall be satisfactory to Administrative Agent and Lenders in their sole discretion.
	The negotiation, execution and delivery of definitive documentation with respect to the Credit Facility shall have occurred and shall be satisfactory to Administrative Agent and the Lenders.
	Administrative Agent shall have received (a) satisfactory opinions of counsel to Borrower (which shall cover, among other things, authority, legality, validity, binding effect and enforceability of the documents for the Credit Facility) and such corporate resolutions, certificates and other documents as Administrative Agent shall reasonably require and (b) satisfactory evidence that Administrative Agent (on behalf of the Lenders) holds a perfected, first priority lien in all collateral for the Credit Facility under the conditions outlined herein, subject to no other liens except for permitted liens, to be determined.
	Administrative Agent and its counsel shall have reviewed and approved Borrower's and its subsidiaries articles or certificates of incorporation, bylaws, partnership agreements and other organizational documents and such certificates of officers of Borrower and its subsidiaries and of governmental authorities as Administrative Agent shall require to evidence the valid incorporation, organization and existence of Borrower.
	There shall not have occurred a material adverse change since September 30, 2000 in the business, assets, operations, condition (financial or otherwise) or prospects of Borrower or its subsidiaries or in the facts and information regarding such entities as represented to date. Fortis acknowledges that Borrower contemplates the issuance of certain Subordinated Indebtedness and Convertible Preferred Stock in connection with its acquisition of Pontotoc Production Inc. and Forman Petroleum Corp. The Terms of Subordination of such issuance and the documentation governing such issuance shall be subject to the approval of Lenders in their sole discretion.
	Administrative Agent shall have completed and approved within 60 days following the Closing Date, a review of title of Borrower's oil and gas properties as outlined herein, and the results of such review shall be acceptable to Administrative Agent in its sole discretion. Prior to Closing, the status of the environmental condition of the oil and gas properties and associated assets and operations shall have been identified, evaluated and disclosed to Administrative Agent. These findings shall be acceptable to Administrative Agent in its sole discretion.
	No action, suit, investigation or proceeding pending or threatened in any court or before any arbitrator or governmental authority that purports to affect Borrower or any transaction contemplated hereby, or that could have a material adverse effect on Borrower shall exist.
	Fortis acknowledges that the transaction contemplated may involve the exercise of certain dissenter's rights by shareholders of Forman Petroleum Corp. and/or Pontotoc Production Inc.
	Borrower and its subsidiaries shall be in compliance with all existing financial obligations.
	Administrative Agent shall have received and reviewed, with results satisfactory to Administrative Agent and its counsel, any material information regarding litigation, tax, accounting, labor, insurance, pension liabilities (actual or contingent), real estate leases, material contracts, debt agreements, property ownership, and contingent liabilities of Borrower and its subsidiaries.
	New equity proceeds equal to or in excess of USD 21.1 shall have been injected, and all other items necessary to perfect the Acquisition, consistent with the Proposed Sources and Uses Statement dated September 2000 (excluding the subject Facility) shall have been satisfied.
	Borrower shall be required to secure certain hedging arrangements involving approximately 50% of future production through December 2002. This percentage is based on the production estimates utilized by Administrative Agent in their determination of the Initial Borrowing Base. The specific terms and conditions surrounding such arrangements shall be outlined in the Credit Agreement governing the subject Facility.
REPRESENTATIONS AND WARRANTIES:	Usual and customary for transactions of this type, to include without limitation: (i) corporate status; (ii) corporate power and authority/enforceability; (iii) no violation of law or contracts or organizational documents; (iv) no material litigation; (v) correctness of specified financial statements and no material adverse change; (vi) no required governmental or third party approvals; (vii) use of proceeds/compliance with margin regulations; (viii) status under Investment Company Act; (ix) ERISA; (x) material environmental matters; (xi) perfected liens and security interests; (xii) payment of taxes; and (xiii) disclosure of material agreements, including all agreements pertaining to the Pontotoc Production Inc. Acquisition.
COVENANTS:	Usual and customary for transactions of this type, to include without limitation: (i) delivery of financial statements and other reports; (ii) delivery of compliance certificates; (iii) delivery of annual third party reserve reports and semi–annual internally prepared reserve reports and other information Administrative Agent or Lenders may reasonably request; (iv) notices of default, material litigation and material governmental and environmental proceedings; (v) compliance with laws; (vi) payment of taxes; (vii) maintenance of insurance; (viii) limitation on liens; (ix) limitations on mergers, consolidations and sales of assets; (x) limitations on incurrence of debt, excluding certain Subordinated Debt discussed herein; (xi) approval from Lenders on changes in senior management; (xii) limitations on dividends and stock redemptions and the redemption and/or prepayment of other debt; (xiii) limitations on investments; (xiv) ERISA; and (xv) limitation on transactions with affiliates. While the payment of certain dividends on preferred stock is contemplated, the terms under which payment of such dividends in cash can be made will be outlined in the final Credit Agreement.
	Financial covenants to include maintenance of (i) a Minimum Current Ratio of 1.0 to 1.0 (Current Ratio shall be defined as Current Assets divided by Current Liabilities); (ii) Maximum Total Debt to EBITDA of not more than 3.0 to 1.0; (iii) Minimum EBITDA to Cash Interest Expense of 3.5 to 1.0; and (iv) minimum Consolidated Tangible Net Worth of USD 40 million. EBITDA, for the purposes of calculating applicable ratios, shall be determined utilizing standard methodology under Generally Accepted Accounting Principals (GAAP). Consolidated Tangible Net Worth shall be defined as the remainder of all Consolidated Assets of Borrower, other than intangible assets (including as intangible assets such assets as patents, copyrights, licenses, franchise, goodwill, trade names, trade secrets and leases other than oil and gas or mineral leases or leases required to be capitalized under GAAP), minus Borrower's Consolidated liabilities. All financial ratios shall be calculated on a rolling four–quarter basis following the first anniversary of the Closing Date. Prior to this date, the period from the Closing Date to the relevant Quarterly Reporting Period shall be considered.
EVENTS OF DEFAULT:	Usual and customary in transactions of this nature, to include, without limitation, (i) nonpayment of principal, interest, fees or other amounts; (ii) violation of covenants; (iii) material inaccuracy of representations and warranties; (iv) cross–default to other material agreements and indebtedness; (v) bankruptcy; (vi) material judgments; (vii) ERISA; (viii) actual or asserted invalidity of any loan documents or security interests; and (ix) Change in Control of Borrower.
WAIVERS &  AMENDMENTS:	Amendments and waivers of the provisions of the Loan Agreement and other definitive documentation will require the approval of Required Lenders, including (i) increases in commitment amounts, (ii) reductions of principal, interest, or fees, (iii) extensions of scheduled maturities or times for payment, (iv) releases of all or substantially all collateral, (v) releases of guarantors, and (vi) increases in the Borrowing Base.
REQUIRED LENDERS:	Lenders holding 100% of the Loans and Commitment. At such time as there shall exist three or more Lenders that are party to the subject Facility and related Credit Agreement governing such Facility, Lenders shall consider the adoption of a "majority bank" concept as it relates to certain future approvals, waivers, amendments, etc. This potential amendment to the proposed initial Credit Agreement would involve an adjustment to the Required Lenders definition.
INDEMNIFICATION:	Borrower shall indemnify the Lenders from and against all losses, liabilities, claims, damages or expenses relating to their loans, Borrower's use of loan proceeds or the commitments, including but not limited to reasonable attorneys' fees and settlements costs. This indemnification shall survive and continue for the benefit of the Lenders at all times after Borrower's acceptance of the Lenders' commitment for the Credit Facility, notwithstanding any failure of the Credit Facility to close.
CLOSING:	On or before April 30, 2001.
GOVERNING LAW:	Texas
FEES/EXPENSES:	As outlined in ADDENDUM I
OTHER:	This term sheet is intended as an outline only and does not purport to summarize or finalize all the conditions, covenants, representations, warranties and other provisions, which would be contained in definitive legal documentation for the Credit Facility contemplated hereby. Borrower shall waive its right to a trial by jury.
COUNSEL FOR ADMINISTRATIVE AGENT:	Patton Boggs LLP

ADDENDUM I
FEES AND EXPENSES

ARRANGEMENT FEE:	1.00% of the initial Borrowing Base amount, payable at Closing. Upfront Fees paid to Lenders will be paid out of this amount at the sole discretion of Fortis Capital Corp.
ANNUAL AGENCY FEE:	USD 25,000, payable on the first anniversary of Closing and on each anniversary thereafter.
COMMITMENT FEE:	A commitment fee equal to the basis points set forth in the table below (calculated on a per annum basis based on the actual number of days elapsed in a year of 360 days) shall be payable on the unused portion of the Borrowing Base. The commitment fee shall be paid quarterly in arrears following the Closing.
INTEREST RATES:	The Credit Facility shall bear interest at a rate equal to LIBOR plus the Applicable LIBOR Margin; provided, that if during the 180 day period following the Closing, any breakage costs, charges or fees are incurred with respect to LIBOR loans on account of the syndication of the Credit Facility, Borrower shall immediately reimburse Administrative Agent for any such costs, charges or fees. Such right of reimbursement to be in addition to and not in limitation of customary cost and yield protection.
	Borrower may select interest periods of 1, 2, 3 or 6 months for LIBOR Loans, subject to availability (limit of 3 LIBOR Loans outstanding at any one time).
	A penalty rate shall apply on all loans in the event of default at a rate per annum of 3.00% above the applicable interest rate.
	The Applicable Margin, Commitment Fee in effect on any day shall be determined based on the ratio of usage of the Credit Facility to the Borrowing Base in effect on such date in accordance with the table below.

Level	Utilization of Borrowing Base	Applicable LIBOR margin	Commitment Fee
First 6 months after Closing	N/A	250 bps	50.0 bps
I	> or = 75%	250 bps	50.0 bps
II	74% – 50%	225 bps	50.0 bps
III	49–25%	200 bps	37.5 bps
IV	< or = 24%	175 bps	37.5 bps

COST AND YIELD PROTECTION:	The usual for transactions and facilities of this type, including, without limitation, in respect of prepayments, changes in capital adequacy and capital requirements or their interpretation, illegality, withholding taxes, unavailability, reserves without proration or offset.
EXPENSES:	Borrower will pay all reasonable costs and expenses associated with the preparation, due diligence, administration, syndication and enforcement of all documents executed in connection with the Credit Facility, including without limitation, the legal fees of Administrative Agent's counsel regardless of whether or not the Credit Facility is closed.

The aforementioned Summary of Terms and Conditions does not represent or convey a final commitment to lend or deliver under the Terms and Conditions outlined herein. Any such commitment is subject to the execution by Fortis Capital Corp., Lenders, and Ascent Energy Inc. of a definitive Credit Agreement and various other related documentation, satisfactory to all parties.