Coleman Oil & Gas Term Sheet and LOU

fyi
---------------------- Forwarded by Gerald Nemec/HOU/ECT on 08/11/99 08:40 AM
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From: Dan J Bump 07/28/99 09:57 AM

To: Gerald Nemec/HOU/ECT@ECT
cc:
Subject: Coleman Oil & Gas Term Sheet and LOU

Gerald:

Coleman is ready to sign an LOU and begin the contracting phase; I have had
numerous discussions with Coleman the past five months and they have seen a
few versions of the attached term sheet. I cannot remember if Shonnie has
reviewed any of the term sheets, so I would appreciate it if you could review
the latest version of the term sheet and share your suggestions. (The MDQ
ratchet in the term sheet is admittedly somewhat confusing...but I'm trying
to limit the amount of MDQ that ECT holds open for these small companies who
are just now beginning to drill acreage in undeveloped areas.)

Thanks.

Dan