BRIGHAM EXPLORATION CO, S-1, 1997-02-27

BRIGHAM EXPLORATION CO
S-1, 1997-02-27

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 27, 1997

REGISTRATION NO. 333-
================================================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
BRIGHAM EXPLORATION COMPANY
(Exact name of Registrant as specified in its charter)

<TABLE>
<C> <C> <C>
DELAWARE
(State or other jurisdiction 1311 75-2692967
of incorporation or (Primary Standard Industrial (I.R.S. Employer
organization) Classification Code Number) Identification No.)
</TABLE>

5949 SHERRY LANE, SUITE 1616
DALLAS, TEXAS 75225
(214) 360-9182
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)

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

BEN M. BRIGHAM
PRESIDENT, CHIEF EXECUTIVE OFFICER
AND CHAIRMAN OF THE BOARD
BRIGHAM EXPLORATION COMPANY
5949 SHERRY LANE, SUITE 1616
DALLAS, TEXAS 75225
(214) 360-9182
(Name, address, including zip code, and telephone number, including area code,
of Registrant's agent for service)

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

Copies of Communication to:

<TABLE>
<C> <C>
JOE DANNENMAIER ROBERT L. KIMBALL
THOMPSON & KNIGHT, P.C. VINSON & ELKINS L.L.P.
1700 PACIFIC AVENUE, SUITE 3300 2001 ROSS AVENUE, SUITE 3700
DALLAS, TEXAS 75201 DALLAS, TEXAS 75201
</TABLE>

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

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]

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

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
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. [ ]

If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]

<TABLE>
<CAPTION>
========================================================================================================
PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED PRICE(1)(2) REGISTRATION FEE
- --------------------------------------------------------------------------------------------------------
<S> <C> <C>
Common Stock, par value $.01 per share.................... $54,625,000 $16,553
========================================================================================================
</TABLE>

(1) In accordance with Rule 457(o) under the Securities Act of 1933, the number
of shares being registered and the proposed maximum offering price per share
are not included in this table.

(2) Estimated for purposes of calculating registration fee.

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 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
================================================================================
<PAGE> 2

Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor
may offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall there be any sale of these
securities in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws
of any such State.

SUBJECT TO COMPLETION, DATED FEBRUARY 27, 1997
PROSPECTUS

[BRIGHAM EXPLORATION COMPANY LOGO]

BRIGHAM EXPLORATION COMPANY
COMMON STOCK

Of the shares of common stock, par value $.01 per share (the
"Common Stock"), offered hereby, shares are being sold by Brigham
Exploration Company ("Brigham" or the "Company"), and shares are being
sold by the Selling Stockholders named herein. Prior to the offering made hereby
(the "Offering"), there has been no public market for the Common Stock. It is
currently estimated that the initial public offering price will be between
$ and $ per share. See "Underwriting" for information relating
to the factors to be considered in determining the initial public offering
price. Application has been made to include the Common Stock for listing on the
Nasdaq National Market under the symbol "BEXP."

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

ANY INVESTMENT IN THE SECURITIES OFFERED HEREIN INVOLVES A HIGH DEGREE OF
RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 11.
------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
====================================================================================================================
UNDERWRITING PROCEEDS TO
PRICE TO DISCOUNTS AND PROCEEDS TO SELLING
PUBLIC COMMISSIONS(1) COMPANY(2) STOCKHOLDERS
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Per Share....................... $ $ $ $
- ------------------------------------------------------------------------------------------------------------------
Total(3)........................ $ $ $ $
==================================================================================================================
</TABLE>

(1) The Company and the Selling Stockholders have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriting."

(2) Before deducting expenses of the Offering payable by the Company estimated
at $ .

(3) The Company and the Selling Stockholders have granted the Underwriters a
30-day option to purchase up to additional shares of Common Stock
on the same terms and conditions as set forth above to cover
over-allotments, if any. If the Underwriters exercise this option in full,
the total Price to Public will be $ , the total Underwriting
Discounts and Commissions will be $ , the total Proceeds to Company
will be $ and the total Proceeds to Selling Stockholders will be
$ . See "Underwriting."

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

The shares of Common Stock are offered, subject to prior sale, when, as and
if delivered to and accepted by the Underwriters and subject certain other
conditions. The Underwriters reserve the right to withdraw, cancel or modify
such offer and to reject orders in whole or in part. It is expected that
delivery of the shares of Common Stock will be made against payment therefor, on
or about , 1997 at the offices of Bear, Stearns & Co. Inc., 245 Park
Avenue, New York, New York 10167.

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

BEAR, STEARNS & CO. INC.
HOWARD, WEIL, LABOUISSE, FRIEDRICHS
INCORPORATED
PETRIE PARKMAN & CO.

THE DATE OF THIS PROSPECTUS IS , 1997
<PAGE> 3

[MAP DEPICTING BRIGHAM'S AREAS OF CORE ACTIVITY]

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

IN CONNECTION WITH THE OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK OF
THE COMPANY AT LEVELS ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED IN THE NASDAQ NATIONAL MARKET SYSTEM,
IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY
BE DISCONTINUED AT ANY TIME.

2
<PAGE> 4

PROSPECTUS SUMMARY

The following summary should be read in conjunction with, and is qualified
in its entirety by, the detailed information and the Financial Statements and
notes thereto included elsewhere in this Prospectus. All references in this
Prospectus to "Brigham" or the "Company" includes Brigham Exploration Company,
its predecessors and their subsidiaries. Unless otherwise indicated, the
information in this Prospectus assumes no exercise of the Underwriters'
over-allotment option. Certain terms relating to the oil and gas industry are
defined in "Glossary of Certain Oil and Gas Terms."

THE COMPANY

Brigham is an independent exploration and production company that focuses
on the use of 3-D seismic imaging and other advanced technologies to
systematically explore and develop onshore domestic natural gas and oil
provinces. With this focus, Brigham has achieved rapid growth in reserves,
potential drilling locations and 3-D seismic data.

Since inception in 1990, Brigham has drilled over 265 exploratory and 35
development wells on its 3-D generated prospects with an aggregate 63% success
rate. Through December 31, 1996, the Company had discovered total estimated
proved reserves of 119.7 Bcf of natural gas and 24.1 MMBbls of oil, or an
aggregate of 264.2 Bcfe, 14% of which is attributable to the Company's interest.
The Company's estimated proved reserves as of December 31, 1996 were 21.9 Bcfe
having an aggregate Present Value of Future Net Revenues of $44.5 million,
compared to estimated proved reserves as of December 31, 1993 of 2.2 Bcfe having
an aggregate Present Value of Future Net Revenues of $3.2 million.

The Company pioneered the acquisition of large scale onshore 3-D seismic
surveys for exploration, obtaining extensive 3-D seismic data and experience in
capturing undiscovered natural gas and oil reserves. Brigham has acquired over
3,300 square miles (2,112,000 acres) of 3-D seismic data and, from the 2,837
square miles interpreted to date, has identified approximately 1,200 potential
drilling locations. Brigham has drilled over 300 of these locations with an
average working interest of 21%. The Company generates most of its exploratory
projects and, therefore, has the ability to retain a sizeable working interest
to the extent that it decides not to place interests with industry participants.
In the projects in which it is currently acquiring 3-D seismic data, the Company
may retain an average working interest in the drilling and leasing phases in
excess of 60%.

BUSINESS STRATEGY

Brigham was founded in 1990 with the core belief that systematic
exploration through the application of 3-D seismic imaging and other advanced
technologies could reduce drilling risks and finding costs. Brigham's business
strategy is to continue to increase shareholder value by focusing on this core
belief.

Brigham's exploration activities are concentrated primarily in three
provinces: the Anadarko Basin, the Gulf Coast and the West Texas region. The
Company is accelerating its 3-D seismic activity in the Anadarko Basin and the
Gulf Coast and will continue such activity in those geologic trends of the West
Texas region where it has achieved its best results historically. Brigham is
focusing its 3-D seismic activity in provinces where it believes 3-D technology
may be effectively applied and that it believes offer large potential reserve
volumes per well and per field, high potential production rates and multiple
producing objectives.

The Company's growth will be driven by drilling and developing its
potential drilling locations, as well as adding new locations through its
systematic 3-D seismic exploration effort. Using the proceeds of the Offering,
Brigham plans to accelerate growth by (i) increasing the working interest it
retains in drilling locations in order to capture a greater share of the
reserves the Company discovers, (ii) increasing the rate at which it acquires
3-D seismic data and identifies potential drilling locations, (iii) seeking to
identify higher potential drilling locations, (iv) increasing the rate at which
potential drilling locations are drilled and (v) reducing the time spent
marketing projects to industry participants.

3
<PAGE> 5

COMPETITIVE ADVANTAGES

Brigham believes that its knowledge base, personnel and technology provide
it with the following competitive advantages to capture undiscovered natural gas
and oil reserves.

Pioneering Innovations. In 1990 the Company pioneered the
assemblage of large scale onshore 3-D seismic projects and the use of
preseismic lease options for the systematic exploration of proven
natural gas and oil provinces. The Company believes it was the first
to form alliances and joint participation arrangements with companies
and individuals possessing extensive local geologic or operating
expertise to complement its 3-D exploration expertise. Subsequent
innovations include the Company's 3-D seismic acquisition and
processing alliances and creative industry trade structures to
financially leverage its drilling program.

3-D Seismic Knowledge Base. The Company began acquiring 3-D
seismic in 1990 and drilled its first 3-D delineated well, which was a
discovery, in February 1991. Since inception, the Company has acquired
over 3,300 square miles of 3-D seismic data and drilled more than 300
wells in over 20 geologic trends in six basins and seven states. As a
result, the Company has gained extensive technological and economic
knowledge relating to the application of 3-D seismic to different
geologic trends. This experience and knowledge enable the Company to
refine its exploration techniques and identify exploration areas where
Brigham believes 3-D seismic can be applied to reduce risks and
enhance returns on its investments.

Technological Expertise. Led by its CEO, who is an experienced,
practicing geophysicist, the Company has built an exploration staff
that includes nine other geophysicists and six geologists. Brigham's
explorationists collectively have over 200 years of experience,
including over 65 years of experience using computer aided exploration
("CAEX") workstations, and have expertise in many geologic trends. The
Company makes extensive use of advanced technologies, including 3-D
seismic imaging and CAEX and in-house analytical and processing
capabilities, to define drilling prospects. To support the efforts of
its explorationists, Brigham has made significant investments in
advanced hardware and software, including twelve UNIX-based CAEX
workstations.

Project Generation and Control. Brigham is not dependent on third
parties for its project flow, having generated approximately 90% of
its 3-D exploration projects. Therefore, the Company is able to manage
the predrilling exploration phases, from project conception and
assemblage through 3-D data acquisition, processing and interpretation
and subsequent leasing. Brigham believes that its management of the
exploration process enhances project quality and compresses the cycle
time, contributing to lower finding and development costs and an
enhanced project rate of return. Furthermore, the Company can
determine the level of working interest it retains and the extent to
which it manages drilling and post-drilling operations and continues
to expand its efforts in these areas.

Numerous Potential Drilling Locations. The Company has identified
approximately 1,200 3-D defined potential drilling locations in
historically productive geologic trends, of which over 300 have been
drilled. The Company anticipates drilling 91 of these locations (23.8
net) in 1997 at a cost of approximately $16.0 million. The Company
also anticipates acquiring approximately 1,400 square miles of 3-D
seismic data in 1997 at a net cost to the Company of approximately
$5.6 million. The Company continually evaluates and prioritizes
potential drilling locations to determine whether to drill them, farm
them out or replace them with higher quality locations.

4
<PAGE> 6

PRIMARY EXPLORATION PROVINCES

Brigham's exploration activities are concentrated primarily in three
provinces: the Anadarko Basin, the Gulf Coast and the West Texas region. Brigham
is accelerating 3-D seismic activity in the Anadarko Basin and the Gulf Coast
and will continue such activity in those geologic trends of the West Texas
region where it has achieved its best results historically. Brigham is focusing
its 3-D seismic exploration efforts in provinces where it believes 3-D
technology may be effectively applied and that it believes offer large potential
reserve volumes per well and per field, high potential production rates and
multiple producing objectives.

Although the Company is acquiring 3-D seismic data within the provinces
listed below and has identified approximately 900 potential drilling locations
yet to be drilled in those provinces, there can be no assurance that any of the
seismic data will be acquired or will generate additional drilling locations or
that any potential drilling locations will be drilled at all or within the
expected time frame. The final determination with respect to the drilling of any
well, including those currently budgeted, will depend on a number of factors,
including (i) the results of exploration efforts and the review and analysis of
the seismic data, (ii) the availability of sufficient capital resources by the
Company and other participants for drilling prospects, (iii) economic and
industry conditions at the time of drilling, including prevailing and
anticipated prices for natural gas and oil and the availability of drilling rigs
and crews, (iv) the financial resources and results of the Company and (v) the
availability of leases on reasonable terms and permitting for the potential
drilling location. There can be no assurance that the budgeted wells will, if
drilled, encounter reservoirs of commercial quantities of natural gas or oil.

<TABLE>
<CAPTION>
ADDITIONAL 3-D 1997
SEISMIC DATA ADDITIONAL BUDGETED ESTIMATED
3-D SEISMIC BUDGETED FOR TOTAL GROSS POTENTIAL WELLS 1997
DATA ACQUIRED/ ACQUISITION WELLS DRILLED DRILLING ------------ CAPITAL
PROVINCE INTERPRETED(1) IN 1997 THROUGH 1996 LOCATIONS(2) GROSS NET EXPENDITURES(3)
-------- --------------- -------------- ------------- ------------ ----- ---- ---------------
(SQUARE MILES) (SQUARE MILES) (IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Anadarko Basin............ 1,043/942 493 31 325 41 12.3 $15,000
Gulf Coast................ 533/154 191 1 31 7 2.2 7,000
West Texas Region......... 1,552/1,552 68 255 508 41 8.2 4,000
Other (4)................. 215/189 60 11 30 2 1.1 1,000
----------- --- --- --- -- ---- -------
Total............. 3,343/2,837 812(5) 298 894 91 23.8 $27,000
=========== === === === == ==== =======
</TABLE>

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

(1) 3-D seismic data that had been or was being acquired/interpreted on February
15, 1997.

(2) The potential drilling locations that had been identified from the portion
of the 3-D seismic data that had been interpreted by February 15, 1997.

(3) 3-D seismic and land acquisition costs and drilling expenditures.

(4) Colorado, Kansas and Montana.

(5) The Company has budgeted approximately 1,400 square miles of 3-D seismic
data for acquisition in 1997, 582 of which had been acquired or were being
acquired on February 15, 1997.

Anadarko Basin. The Anadarko Basin is a prolific natural gas province that
the Company believes has been relatively under explored, particularly with
regard to deep, high potential objectives. The Anadarko Basin contains numerous
historically elusive stratigraphic targets, such as the Red Fork, Morrow and
Springer channel sands, and structural targets, such as the Hunton and Arbuckle
carbonates, which are well-suited to 3-D seismic imaging. In some cases, these
objectives have produced in excess of 30 Bcf of natural gas from a single well
at rates up to 30 MMcf of natural gas per day.

The Company has assembled an extensive digital data base in this province,
including geologic studies, basin wide geologic tops, production data, well
data, geographic data and over 7,400 miles of 2-D seismic data. Working with
consulting regional geologists, the Company's explorationists integrate this
data with their extensive expertise and knowledge base to generate 3-D projects
in the Anadarko Basin.

5
<PAGE> 7

success rate) in this province and had found cumulative proved reserves of 53.4
Bcf of natural gas and 1.7 MMBbls of oil, or an aggregate of 63.4 Bcfe, with
16.3% attributable to the Company's interest. In 1996, the Company completed 14
wells in 20 attempts, adding 38.8 Bcfe of proved reserves, with 6.7 Bcfe
attributable to the Company's interest. As of February 15, 1997, the Company had
325 3-D delineated potential drilling locations in the Anadarko Basin, of which
the Company intends to drill 41 gross (12.3 net) wells in 1997.

Gulf Coast. The Gulf Coast is a high potential, multi-pay province that
lends itself to 3-D seismic exploration due to its substantial structural and
stratigraphic complexity. The Company has assembled a digital data base
including geographical, production, geophysical and geological information that
the Company evaluates on its CAEX workstations. Working with consulting regional
geologists the Company's explorationists integrate this data with their
expertise and knowledge base to generate 3-D projects in the Gulf Coast.
Brigham's commitment to this province is evidenced by the Company's staff
additions, the opening of its Houston office and the addition of ten new 3-D
seismic projects in 1996 and 1997.

As of February 15, 1997, the Company had acquired or was acquiring 533
square miles (341,120 acres) of 3-D seismic data in six projects in the onshore
Gulf Coast. The Company anticipates acquiring 191 square miles (122,240 acres)
of additional 3-D seismic data in 1997.

The Company anticipates that its increased project assemblage and 3-D
seismic acquisition activity in the Gulf Coast will generate accelerated
drilling in the province in 1997 and 1998. The Company is currently assembling
projects in the Expanded Wilcox, Expanded Vicksburg and Yegua trends in South
Texas, the Miocene trend in South Texas and South Louisiana, the Lower and
Middle Frio trends of the upper Gulf Coast of Texas. The Company has thirty-one
3-D delineated potential drilling locations in the Gulf Coast and intends to
drill 7 gross (2.2 net) wells in 1997.

West Texas Region. The Company's 3-D seismic and drilling activity in the
West Texas region has been focused in the Horseshoe Atoll, the Midland Basin and
the Eastern Shelf of the Permian Basin and the Hardeman Basin. The Company plans
to continue drilling its locations in these areas. Recently the Company
significantly increased its activity in portions of geologic trends that the
Company believes offer greater potential for lower finding costs and higher
returns, including the Ellenberger and Devonian formations of the Delaware Basin
and the Fusselman formation of the Permian Basin. One area where the Company
increased its activity is in the Midland Basin, where the Company has drilled
five recent Fusselman discoveries and has acquired or intends to acquire 3-D
seismic in four additional projects, in which it expects to retain working
interests in excess of 50%.

As of February 15, 1997, the Company had acquired 1,552 square miles
(993,280 acres) of 3-D seismic in 73 projects in the West Texas region. As of
December 31, 1996, the Company had completed 164 wells in 255 attempts (a 64%
success rate) and had found cumulative proved reserves of 66.3 Bcf of natural
gas and 22.2 MMBbls of oil, or an aggregate of 199.7 Bcfe, with 13.5%
attributable to the Company's interest. In 1996 the Company completed 28 wells
in 43 attempts in this province, adding 29.8 Bcfe of proved reserves, with 5.7
Bcfe attributable to the Company's interest. The Company has 508 3-D delineated
potential drilling locations in the West Texas region and intends to drill 41
gross (8.2 net) wells in 1997.

6
<PAGE> 8

THE OFFERING

<TABLE>
<S> <C>
Common Stock Offered
By the Company.......................................... shares
By the Selling Stockholders............................. shares
Common Stock to be Outstanding after the Offering......... shares(1)
Use of Proceeds........................................... The net proceeds of the Offering will
be used for exploration and
development activities, repayment of
all outstanding indebtedness of
approximately $11 million, and other
general corporate purposes. See "Use
of Proceeds."
Proposed Nasdaq National Market Symbol.................... "BEXP"
</TABLE>

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

(1) Does not include 644,097 shares of Common Stock issuable upon exercise of
outstanding employee stock options with an average exercise price of
$ per share. See "Management -- Executive Compensation" and Note 3
of Notes to Balance Sheet and Note 8 of Notes to Financial Statements.

RISK FACTORS

Any investment in the Common Stock involves a high degree of risk. For a
discussion of certain risks that a potential investor should carefully evaluate
prior to making an investment in the Common Stock, see "Risk Factors."

7
<PAGE> 9

SUMMARY FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

The following table sets forth certain summary financial data of the
Company. The information should be read in conjunction with the Management's
Discussion and Analysis of Financial Condition and Results of Operations, the
Unaudited Pro Forma Financial Statements and notes thereto and the Financial
Statements and notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------
1992(1) 1993 1994 1995 1996
------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues:
Natural gas and oil sales............... $ 244 $ 937 $ 2,565 $ 3,578 $ 6,141
Workstation revenue..................... 252 467 815 635 627
------- ------- ------- ------- --------
Total revenues..................... 496 1,404 3,380 4,213 6,768
Costs and expenses:
Lease operating......................... 32 111 491 761 726
Production taxes........................ 12 47 126 165 362
General and administrative.............. 462 1,433 1,785 1,897 2,199
Depletion of natural gas and oil
properties............................ 127 4,371(2) 1,104 1,626 2,323
Depreciation and amortization........... 224 406 561 533 487
------- ------- ------- ------- --------
Total costs and expenses........... 857 6,368 4,067 4,982 6,097
------- ------- ------- ------- --------
Operating income (loss).................... (361) (4,964) (687) (769) 671
Other income (expense):
Interest income......................... 12 6 56 128 52
Interest expense........................ (21) (105) (668) (936) (1,173)
------- ------- ------- ------- --------
Net loss................................... $ (370) $(5,063) $(1,299) $(1,577) $ (450)
======= ======= ======= ======= ========
PRO FORMA STATEMENT OF OPERATIONS DATA:
Net income (loss)(3)(4).................... $ (386)
Net income (loss) per share(3)(4).......... $ (0.04)
Weighted average shares outstanding(3)..... 9,343
STATEMENT OF CASH FLOWS DATA:
Net cash provided by (used in) operating
activities.............................. $ (172) $ (730) $ 626 $ 1,383 $ 3,710
Net cash used in investing activities...... (3,931) (6,983) (5,463) (8,005) (11,796)
Net cash provided by financing
activities.............................. 4,845 7,839 4,634 7,724 7,731
OTHER FINANCIAL DATA:
Capital expenditures....................... $ 4,285 $ 6,632 $ 5,445 $ 7,935 $ 13,612
EBITDA(5).................................. 2 (181) 1,034 1,518 3,533
Cash flow from operations(6)............... (18) (285) 366 582 2,360
</TABLE>

<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1996
--------------------------------------------
PRO FORMA
ACTUAL PRO FORMA(3) AS ADJUSTED(3)(7)
------- ------------ -----------------
<S> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents.......................... $ 1,447 $ 1,447
Natural gas and oil properties, net................ 28,005 28,005
Total assets....................................... 33,614 33,614
Notes payable...................................... 24,000 8,000
Total equity....................................... 3,244 14,565
</TABLE>

8
<PAGE> 10

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

(1) Represents the period from inception (May 1, 1992) of the Partnership, the
Company's predecessor, through December 31, 1992. Operations of the
predecessor to the Partnership for the period from January 1, 1992 through
April 30, 1992 were insignificant. See "The Company."

(2) Includes a capitalized ceiling impairment of $3.3 million in 1993.

(3) Gives effect to the Exchange (see "The Company") and the issuance of stock
options to employees under the 1997 Incentive Plan as if they had occurred
on January 1, 1996 for Statement of Operations Data and as of December 31,
1996 for Balance Sheet Data. See the Unaudited Pro Forma Financial
Statements and Note 1 of Notes to Financial Statements.

(4) Prior to the Exchange, the Company's predecessor was classified as a
partnership for federal income tax purposes. No provision has been made for
income taxes since these taxes are the responsibility of the partners. The
pro forma data reflect an income tax benefit in 1996 of $330,000 and a
deferred tax liability of $5.1 million at December 31, 1996 which would have
been recorded if the Company's predecessor had been required to pay federal
income taxes.

(5) EBITDA represents net income plus income taxes, interest expense and
depreciation, depletion and amortization expense. EBITDA should not be
considered in isolation or as a substitute for net income, cash flows from
operating activities or any other measure of financial performance prepared
in accordance with generally accepted accounting principles or as a measure
of a company's profitability or liquidity.

(6) Cash flow from operations represents net income plus non-cash items. Cash
flow from operations should not be considered in isolation or as a
substitute for net income, cash flows from operating activities or any other
measure of financial performance prepared in accordance with generally
accepted accounting principles or as a measure of a company's profitability
or liquidity.

(7) As adjusted for the Offering and the application of the estimated $
million in net proceeds. See "Use of Proceeds."

9
<PAGE> 11

SUMMARY RESERVE AND OPERATING DATA
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------
1992(1) 1993 1994 1995 1996(2)
------- ------ ------- ------- -------
<S> <C> <C> <C> <C> <C>
3-D SEISMIC ACQUIRED ANNUALLY:
Gross square miles........................ 288 908 423 311 655
Average project working interest.......... 17% 30% 27% 29% 37%
WELLS DRILLED ANNUALLY:
Gross wells drilled....................... 19 52 73 78 68
Net wells drilled......................... 1.5 9.2 16.8 18.5 16.0
Average drilling working interest......... 8% 18% 23% 24% 24%
ESTIMATED PROVED RESERVES (AT YEAR END)(3):
Natural gas (MMcf)........................ 57 227 3,579 4,257 10,257
Oil (MBbls)............................... 93 336 1,022 1,672 1,940
Natural gas equivalent (MMcfe)............ 614 2,243 9,710 14,288 21,895
Proved developed reserves as a percentage
of proved reserves..................... 100% 100% 76% 80% 67%
Present Value of Future Net Revenues...... $1,083 $3,158 $10,240 $18,222 $44,506
PRODUCTION VOLUMES:
Natural gas (MMcf)........................ 6 59 165 272 698
Oil (MBbls)............................... 11 50 140 177 227
Natural gas equivalent (MMcfe)............ 74 359 1,002 1,332 2,060
PERCENTAGE OF RESERVES REPLACED(4).......... 936% 533% 809% 368% 500%
PER MCFE DATA:
Natural gas and oil sales................. $ 3.32 $ 2.61 $ 2.56 $ 2.69 $ 2.98
Workstation revenue....................... 3.43 1.30 .81 .48 .30
Lease operating expenses.................. (.43) (.31) (.49) (.57) (.35)
Production taxes.......................... (.16) (.13) (.13) (.12) (.18)
General and administrative expenses....... (6.28) (3.99) (1.78) (1.42) (1.07)
------ ------ ------- ------- -------
Operating margin....................... $ (.12) $ (.52) $ .97 $ 1.06 $ 1.68
====== ====== ======= ======= =======
</TABLE>

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

(2) Net of a sale by the Company in January 1996 of its interest in certain
properties that accounted for 303 MMcf of natural gas and 277 MBbls of oil
(1,962 MMcfe of proved reserves) as of December 31, 1996.

(3) The estimates of reserve and present value data as of December 31, 1996 have
been prepared in accordance with the SEC's guidelines by Cawley, Gillespie &
Associates, Inc., the Company's independent petroleum consultants ("Cawley
Gillespie"). Cawley Gillespie's letter summarizing its December 31, 1996
reserve report is Appendix A to this Prospectus.

(4) Reserve replacement is calculated as reserve additions divided by the
Company's production for the period.
10
<PAGE> 12

RISK FACTORS

Any investment in the Common Stock involves a high degree of risk.
Prospective purchasers of the Common Stock should carefully consider the risk
factors set forth below, as well as the other information contained in this
Prospectus. This Prospectus contains forward-looking statements. Actual results
may differ materially from those projected in the forward-looking statements as
a result of any number of factors, including risk factors set forth below.

DEPENDENCE ON EXPLORATORY DRILLING ACTIVITIES

The Company's revenues, operating results and future rate of growth are
highly dependent upon the success of its exploratory drilling program, which
will be funded in part with the proceeds of the Offering. Exploratory drilling
involves numerous risks, including the risk that no commercially productive
natural gas or oil reservoirs will be encountered. The cost of drilling,
completing and operating wells is often uncertain, and drilling operations may
be curtailed, delayed or cancelled as a result of a variety of factors,
including unexpected drilling conditions, pressure or irregularities in
formations, equipment failures or accidents, adverse weather conditions,
compliance with governmental requirements and shortages or delays in the
availability of drilling rigs and the delivery of equipment. Despite the use of
3-D seismic and other advanced technologies, exploratory drilling remains a
speculative activity. Even when fully utilized and properly interpreted, 3-D
seismic data and other advanced technologies only assist geoscientists in
identifying subsurface structures and do not enable the interpreter to know
whether hydrocarbons are in fact present in those structures. In addition, the
use of 3-D seismic data and other advanced technologies requires greater
predrilling expenditures than traditional drilling strategies, and the Company
could incur losses as a result of such expenditures. The Company's future
drilling activities may not be successful. There can be no assurance that the
Company's overall drilling success rate or its drilling success rate for
activity within a particular province will not decline. Unsuccessful drilling
activities could have a material adverse effect on the Company's results of
operations and financial condition. The Company may not have any option or lease
rights in potential drilling locations it identifies. Although the Company has
identified numerous potential drilling locations, there can be no assurance that
they will ever be leased or drilled or that natural gas or oil will be produced
from these or any other potential drilling locations.

VOLATILITY OF NATURAL GAS AND OIL PRICES

The Company's revenues, operating results and future rate of growth are
highly dependent upon the prices received for the Company's natural gas and oil.
Historically, the markets for natural gas and oil have been volatile and are
likely to continue to be volatile in the future. Various factors beyond the
control of the Company will affect prices of its natural gas and oil, including
worldwide and domestic supplies of natural gas and oil, the ability of the
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-producing regions, the price and level of foreign imports, the
level of consumer demand, the price and availability of alternative fuels, the
availability of pipeline capacity, weather conditions, domestic and foreign
governmental regulations and taxes, and the overall economic environment. During
1996, the high and low prices for oil on the NYMEX were $26.57 per Bbl and
$17.45 per Bbl, and the high and low prices for natural gas on the NYMEX were
$4.57 per MMBtu and $1.76 per MMBtu. It is impossible to predict future natural
gas and oil price movements with certainty. Declines in natural gas and oil
prices may materially adversely affect the Company's financial condition,
liquidity, ability to finance planned capital expenditures and results of
operations. Lower natural gas and oil prices also may reduce the amount of
natural gas and oil that the Company can produce economically. Any significant
decline in the price of oil or natural gas would adversely affect the Company's
revenues and operating income and may require a reduction in the carrying value
of the Company's natural gas and oil properties. See "Risk Factors-Uncertainty
of Reserve Information and Future Net Revenue Estimates," "Business and
Properties -- Competition," "Business and Properties -- Governmental
Regulation," and "Business and Properties -- Environmental Matters."

11
<PAGE> 13

RISKS ASSOCIATED WITH MANAGEMENT OF GROWTH AND IMPLEMENTATION OF GROWTH STRATEGY

The Company's rapid growth has placed, and is expected to continue to
place, a significant strain on the Company's financial, technical, operational
and administrative resources. As the Company increases the number of projects it
is evaluating or in which it is participating, there will be additional demands
on the Company's financial, technical and administrative resources. In addition,
the Company has only limited experience operating and managing field operations,
including drilling, and there can be no assurances that the Company will be
successful in doing so. Any increase in the Company's activities as an operator
will increase its exposure to operating hazards. See "Risk Factors -- Operating
Hazards and Uninsured Risks." The failure to continue to upgrade the Company's
technical, administrative, operating and financial control systems or the
occurrence of unexpected expansion difficulties, including difficulties in
recruiting and retaining geophysicists, geologists, engineers and sufficient
numbers of qualified personnel to enable the Company to expand its role in the
drilling and production phase, or the reduced availability of seismic gathering,
drilling or other services in the face of growing demand, could have a material
adverse effect on the Company's business, financial condition and results of
operations.

SUBSTANTIAL CAPITAL REQUIREMENTS

The Company makes and will continue to make substantial capital
expenditures in its exploration and development projects. The Company intends to
finance these capital expenditures with the net proceeds from the Offering, cash
flow from operations and its existing financing arrangements. Additional
financing may be required in the future to fund the Company's developmental and
exploratory drilling and 3-D seismic acquisition activities. No assurance can be
given as to the availability or terms of any such additional financing that may
be required or that financing will continue to be available under the existing
or new financing arrangements. If additional capital resources are not available
to the Company, its drilling and other activities may be curtailed and its
business, financial condition and results of operations could be materially
adversely affected. See "Use of Proceeds" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Liquidity and
Capital Resources."

HISTORICAL OPERATING LOSSES AND VARIABILITY OF OPERATING RESULTS

The Company has incurred net losses in each year of operation, and there
can be no assurance that the Company will be profitable in the future. In
addition, the Company's future operating results may fluctuate significantly
depending upon a number of factors, including industry conditions, prices of
natural gas and oil, rates of drilling success, rates of production from
completed wells and the timing of capital expenditures. This variability could
have a material adverse effect on the Company's business, financial condition
and results of operations. In addition, any failure or delay in the realization
of expected cash flows from operating activities could limit the Company's
ability to invest and participate in economically attractive projects. See
"Selected Financial Data" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations."

RESERVE REPLACEMENT RISK

In general, production from natural gas and oil properties declines as
reserves are depleted, with the rate of decline depending on reservoir
characteristics. Except to the extent the Company conducts successful
exploration and development activities or acquires properties containing proved
reserves, or both, the proved reserves of the Company will decline as reserves
are produced. The Company's future natural gas and oil production is highly
dependent upon its ability to economically find, develop or acquire reserves in
commercial quantities. The business of exploring for or developing reserves is
capital intensive. To the extent cash flow from operations is reduced and
external sources of capital become limited or unavailable, the Company's ability
to make the necessary capital investment to maintain or expand its asset base of
natural gas and oil reserves would be impaired. The Company participates in a
substantial percentage of its wells as non-operator. The failure of an operator
of the Company's wells to adequately perform operations, or an operator's breach
of the applicable agreements, could adversely impact the Company. In addition,
there can be no assurance that the Company's future exploration and development
activities will result in additional proved reserves or that

12
<PAGE> 14

the Company will be able to drill productive wells at acceptable costs.
Furthermore, although the Company's revenues could increase if prevailing prices
for natural gas and oil increase significantly, the Company's finding and
development costs could also increase. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations."

OPERATING HAZARDS AND UNINSURED RISKS

The Company's operations are subject to hazards and risks inherent in
drilling for and producing and transporting natural gas and oil, such as fires,
natural disasters, explosions, encountering formations with abnormal pressures,
blowouts, cratering, pipeline ruptures and spills, any of which can result in
the loss of hydrocarbons, environmental pollution, personal injury claims and
other damage to properties of the Company and others. As protection against
operating hazards, the Company maintains insurance coverage against some, but
not all, potential losses. The Company may elect to self-insure if management
believes that the cost of insurance, although available, is excessive relative
to the risks presented. The occurrence of an event that is not covered, or not
fully covered, by insurance could have a material adverse effect on the
Company's financial condition and results of operations. In addition, pollution
and environmental risks generally are not fully insurable. See "Business and
Properties -- Operating Hazards and Uninsured Risks."

UNCERTAINTY OF RESERVE INFORMATION AND FUTURE NET REVENUE ESTIMATES

Numerous uncertainties are inherent in estimating quantities of proved
reserves and their values, including many factors beyond the Company's control.
The reserve information in this Prospectus is an estimate only. Although the
Company believes these estimates are reasonable, reserve estimates are imprecise
and are expected to change as additional information becomes available.

Estimates of natural gas and oil reserves by necessity are projections
based on engineering data, and uncertainties are inherent in the interpretation
of this data, the projection of future rates of production and the timing of
development expenditures. Reserve engineering is a subjective process of
estimating underground accumulations of natural gas and oil that are difficult
to measure. The accuracy of any reserve estimate is a function of the quality of
available data, engineering and geologic interpretation, and judgment. Estimates
of economically recoverable natural gas and oil reserves and of future net cash
flows depend upon a number of variable factors and assumptions, such as
historical production from the area compared with production from other
producing areas, the assumed effects of regulations by governmental agencies,
and assumptions concerning future natural gas and oil prices, future operating
costs, severance and excise taxes, development costs and workover and remedial
costs, all of which may in fact vary considerably from actual results. For these
reasons, estimates of the economically recoverable quantities of natural gas and
oil attributable to any particular group of properties, classifications of
reserves based on risk of recovery, and estimates of the future net cash flows
may vary substantially. Moreover, there can be no assurance that the Company's
reserves will ultimately be produced or that the Company's proved undeveloped
reserves will be developed within the periods anticipated. Any significant
variance in the assumptions could materially affect the estimated quantity and
value of the Company's reserves. Actual production, revenues and expenditures
with respect to the Company's reserves will likely vary from estimates, and such
variances may be material. See "Business and Properties -- Natural Gas and Oil
Reserves."

The Present Value of Future Net Revenues referred to in this Prospectus
should not be construed as the current market value of the estimated natural gas
and oil reserves attributable to the Company's properties. In accordance with
applicable requirements of the SEC, the estimated discounted future net cash
flows from proved reserves are generally based on prices and costs as of the
date of the estimate, whereas actual future prices and costs may be materially
higher or lower. Actual future net cash flows also will be affected by factors
such as the amount and timing of actual production, supply and demand for
natural gas and oil, curtailments or increases in consumption by gas purchasers,
and changes in governmental regulations or taxation. The timing of actual future
net cash flows from proved reserves, and thus their actual present value, will
be affected by the timing of both the production and the incurrence of expenses
in connection with development and production of natural gas and oil properties.
In addition, the 10% discount factor, which must be used to calculate discounted
future net cash flows for reporting purposes, is not necessarily the most
appropriate

13
<PAGE> 15

discount factor based on interest rates in effect from time to time and risks
associated with the Company or the oil and gas industry in general.

COMPETITION

The Company operates in the highly competitive areas of natural gas and oil
exploration, exploitation, acquisition and production with other companies. In
seeking to acquire desirable producing properties or new leases for future
exploration and in marketing its natural gas and oil production, as well as in
seeking to acquire the equipment and expertise necessary to operate and develop
those properties, the Company faces intense competition from a large number of
independent, technology-driven companies as well as both major and other
independent natural gas and oil companies. Many of these competitors have
financial and other resources substantially in excess of those available to the
Company. See "Business and Properties -- Competition." The effects of this
highly competitive environment could have a material adverse effect on the
Company.

COMPLIANCE WITH GOVERNMENT REGULATIONS

The Company's business is subject to federal, state and local laws and
regulations relating to the exploration for, and the development, production and
transportation of, natural gas and oil, as well as safety matters. Although the
Company believes it is in substantial compliance with all applicable laws and
regulations, legal requirements are frequently changed and subject to
interpretation, and the Company is unable to predict the ultimate cost of
compliance with these requirements or their effect on its operations.
Significant expenditures may be required to comply with governmental laws and
regulations. See "Business and Properties -- Governmental Regulation."

COMPLIANCE WITH ENVIRONMENTAL REGULATIONS

The Company's operations are subject to complex environmental laws and
regulations adopted by federal, state and local governmental authorities.
Environmental laws and regulations are frequently changed. The implementation of
new, or the modification of existing, laws or regulations could have a material
adverse effect on the Company. The discharge of natural gas, oil, or other
pollutants into the air, soil or water may give rise to significant liabilities
on the part of the Company to the government and third parties and may require
the Company to incur substantial costs of remediation. No assurance can be given
that existing environmental laws or regulations, as currently interpreted or
reinterpreted in the future, or future laws or regulations will not materially
adversely affect the Company's results of operations and financial condition.
See "Business and Properties -- Environmental Matters."

RISK OF HEDGING ACTIVITIES

The Company's use of swap arrangements to reduce its sensitivity to energy
price volatility is subject to a number of risks. If the Company's reserves are
not produced at rates equivalent to the hedged position, the Company would be
required to satisfy its obligations under hedging contracts on potentially
unfavorable terms without the ability to hedge that risk through sales of
comparable quantities of its own production. Further, the terms under which the
Company enters into hedging contracts are based on assumptions and estimates of
numerous factors such as cost of production and pipeline and other
transportation costs to delivery points. Substantial variations between the
assumptions and estimates used by the Company and actual results experienced
could materially adversely affect the Company's anticipated profit margins and
its ability to manage the risk associated with fluctuations in natural gas and
oil prices. Additionally, hedging contracts limit the benefits the Company will
realize if actual prices rise above the contract prices. In addition, hedging
contracts are subject to the risk that the other party may prove unable or
unwilling to perform its obligations under such contracts. Any significant
nonperformance could have a material adverse financial effect on the Company. As
of December 31, 1996, the Company had approximately 36.6% of its average monthly
oil production (based on fourth quarter production) committed to hedging
contracts through May 1997. In 1996 the Company did not hedge any of its natural
gas production. For the year ended December 31, 1996, the

14
<PAGE> 16

Company realized a reduction in revenues attributable to oil hedges of $301,280.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Other Matters."

MARKETABILITY OF PRODUCTION

The marketability of the Company's production depends in part upon the
availability, proximity and capacity of natural gas gathering systems, pipelines
and processing facilities. The Company delivers natural gas through gas
gathering systems and gas pipelines that it does not own. Federal and state
regulation of natural gas and oil production and transportation, tax and energy
policies, changes in supply and demand and general economic conditions all could
adversely affect the Company's ability to produce and market its natural gas and
oil. Any dramatic change in market factors could have a material adverse effect
on the Company.

DEPENDENCE ON KEY PERSONNEL

The Company has assembled a team of geologists, geophysicists and engineers
having considerable experience applying 3-D imaging technology. The Company is
dependent upon the knowledge, skills and experience of these experts to provide
3-D imaging and assist the Company in reducing the risks associated with its
participation in natural gas and oil exploration projects. In addition, the
success of the Company's business also depends to a significant extent upon the
abilities and continued efforts of its management, particularly Ben M. Brigham,
the Company's President, Chief Executive Officer and Chairman of the Board. The
Company has an employment agreement with Ben M. Brigham, but does not have an
employment agreement with any of its other employees. The Company has key man
life insurance on Mr. Brigham in the amount of $2.0 million. The loss of
services of key management personnel or the Company's technical experts, or the
inability to attract additional qualified personnel, could have a material
adverse effect on the Company's business, financial condition, results of
operations, development efforts and ability to grow. There can be no assurance
that the Company will be successful in attracting and retaining such executives,
geophysicists, geologists and engineers. See "Management -- Directors and
Executive Officers" and "Business and Properties -- Exploration Staff."

CONTROL BY EXISTING STOCKHOLDERS

Upon completion of the Offering, directors, executive officers and
principal stockholders of the Company, and certain of their affiliates, will
beneficially own approximately % of the Company's outstanding Common Stock
(approximately % if the Underwriters exercise the over-allotment option in
full). Accordingly, these stockholders, as a group, will be able to control the
outcome of stockholder votes, including votes concerning the election of
directors, the adoption or amendment of provisions in the Company's Certificate
of Incorporation or Bylaws and the approval of mergers and other significant
corporate transactions. The existence of these levels of ownership concentrated
in a few persons make it unlikely that any other holder of Common Stock will be
able to affect the management or direction of the Company. These factors may
also have the effect of delaying or preventing a change in the management or
voting control of the Company. See "Principal and Selling Stockholders."

CERTAIN ANTITAKEOVER CONSIDERATIONS

The Company's Certificate of Incorporation authorizes the Board of
Directors of the Company to issue up to 10.0 million shares of preferred stock
without stockholder approval and to set the rights, preferences and other
designations, including voting rights, of those shares as the Board of Directors
may determine. These provisions, alone or in combination with the matters
described in "Risk Factors -- Control by Existing Stockholders," may discourage
transactions involving actual or potential changes of control of the Company,
including transactions that otherwise could involve payment of a premium over
prevailing market prices to holders of Common Stock. The Company also is subject
to provisions of the Delaware General Corporation Law that may make some
business combinations more difficult. See "Description of Capital Stock --
Delaware Law Provisions."

15
<PAGE> 17

SHARES ELIGIBLE FOR FUTURE SALE; REGISTRATION RIGHTS

Sales of a substantial number of shares of Common Stock in the public
market following the Offering could adversely affect the market price for the
Common Stock. The Company believes all of the shares of Common Stock currently
outstanding will be eligible for sale under Rule 144 on February 27, 1998,
subject to compliance with the volume and other limitations of Rule 144. Some
investors have the right to require the Company to register the public resale of
their shares before that time. See "Shares Eligible for Future Sale" and
"Description of Capital Stock -- Registration Rights."

IMMEDIATE AND SUBSTANTIAL DILUTION

Purchasers of the Common Stock in the Offering will experience an immediate
and substantial dilution in pro forma net tangible book value per share. See
"Dilution."

NO PRIOR PUBLIC MARKET; POSSIBLE STOCK PRICE VOLATILITY

Before the Offering, there has been no public market for the Common Stock,
and an active public market for the Common Stock may not develop or be
sustained. The initial public offering price will be determined through
negotiation between the Company and the Representatives of the Underwriters
based on several factors that may not be indicative of future market prices. See
"Underwriting" for a discussion of the factors to be considered in determining
the initial public offering price. The trading price of the Common Stock and the
price at which the Company may sell securities in the future could be subject to
large fluctuations in response to changes in government regulations, quarterly
variations in operating results, litigation, general market conditions, the
prices of natural gas and oil, announcements by the Company and its competitors,
the liquidity of the Company, the Company's ability to raise additional funds
and other events.

16
<PAGE> 18

THE COMPANY

Brigham was formed in February 1997 and is the holding company for Brigham
Oil & Gas, L.P. (the "Partnership"), a Texas limited partnership. Brigham, Inc.
was formed as a Texas corporation in September 1990 to pursue natural gas and
oil exploration using 3-D seismic technology. The Partnership was formed in May
1992 by contribution of assets of Brigham, Inc., and its general partners were
General Atlantic Partners III, L.P., a Delaware limited partnership ("GAP III"),
and Brigham, Inc. Under the Exchange Agreement (the "Exchange Agreement"),
effective February 27, 1997, the following transactions occurred: (i) GAP III
and the limited partners of the Partnership transferred all their partnership
interests to the Company in exchange for an aggregate of 3,859,821 shares of
Common Stock, (ii) the stockholders of Brigham, Inc. transferred all of the
issued and outstanding stock of Brigham, Inc. to the Company in exchange for an
aggregate of 3,314,286 shares of Common Stock and (iii) Resource Investors
Management Company ("RIMCO") exchanged all of the 5% Convertible Unsecured
Subordinated Notes of the Partnership for 1,754,464 shares of Common Stock.
These transactions are referred to in this Prospectus as the "Exchange." As a
result of the Exchange, Brigham Exploration Company owns, directly or
indirectly, all the partnership interests in the Partnership and conducts its
active business operations through the Partnership. References to the "Company"
or to "Brigham" are to Brigham Exploration Company and its predecessors and
subsidiaries, including the Partnership and Brigham, Inc.

Brigham's principal executive offices are located at 5949 Sherry Lane,
Suite 1616, Dallas, Texas 75225, and its telephone number is (214) 360-9182. In
July 1997, the Company intends to relocate its principal executive offices to
6300 Bridgepoint Parkway, Building 2, Suite 500, Austin, Texas 78730.

USE OF PROCEEDS

The net proceeds to the Company from the sale of the shares of Common Stock
offered by the Company are estimated to be approximately $ million ($
million if the Underwriters exercise their over-allotment option in full), based
on an assumed initial public offering price of $ per share and after
deducting the estimated underwriting discounts and commissions and estimated
offering expenses.

The Company intends to use the net proceeds for exploration and development
activities, repayment of all outstanding indebtedness of approximately $11
million under the Revolving Credit Facility, and other general corporate
purposes. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations -- Liquidity and Capital Resources -- Revolving Credit
Facility" for a description of the Revolving Credit Facility. Pending
application of the net proceeds of the Offering as described above, they will be
invested in short-term, interest-bearing instruments. The Company will not
receive any of the proceeds from the sale of Common Stock by the Selling
Stockholders in the Offering.

DIVIDEND POLICY

The Company has never declared or paid cash dividends on its Common Stock
and anticipates that all future earnings will be retained for use in its
business. In addition, the Revolving Credit Facility prohibits the payment of
cash dividends on Common Stock. The Board of Directors of the Company may review
the Company's dividend policy from time to time in light of, among other things,
the Company's earning and financial position. See "Management's Discussion and
Analysis of Financial Condition and Results of Operation -- Liquidity and
Capital Resources" and Note 4 of Notes to Financial Statements.

17
<PAGE> 19

DILUTION

The Company's pro forma net tangible book value at December 31, 1996 was
$14.5 million, or approximately $1.62 per share of Common Stock. Net tangible
book value per share represents the amount of total tangible assets of the
Company reduced by the amount of the Company's total liabilities, divided by the
number of shares of Common Stock outstanding. After giving effect to the sale by
the Company of shares of Common Stock in the Offering at an assumed initial
public offering price of $ per share and the application of the
estimated net proceeds as described under "Use of Proceeds," the Company's pro
forma as adjusted net tangible book value as of December 31, 1996 would have
been $ million, or $ per share. This represents an immediate
increase in pro forma net tangible book value of $ per share to the
Company's existing stockholders and an immediate dilution in pro forma net
tangible book value of $ per share to new investors purchasing shares
of Common Stock in the Offering. The following table illustrates the per share
dilution in pro forma net tangible book value to new investors:

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............. $
Pro forma net tangible book value per share
of Common Stock at December 31, 1996................... $
Increase per share attributable to new investors..........
----------
Pro forma as adjusted net tangible book value per share
after the Offering........................................
----------
Pro forma dilution per share to new investors............... $
==========
</TABLE>

The following table sets forth the number of shares of Common Stock
purchased from the Company, the total consideration paid, and the average price
per share paid by the existing stockholders and new investors (based on the
assumed initial public offering price before deducting estimated underwriting
discounts and commissions and estimated offering expenses):

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
--------------------------- --------------------------- PRICE
NUMBER PERCENTAGE AMOUNT PERCENTAGE PER SHARE
-------------- ---------- -------------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Existing stockholders.......... 8,928,571 % $ % $
New investors
--------- ------ ------- ------
Total..................... 100.0% $ 100.0%
========= ====== ======= ======
</TABLE>

The Company has reserved 1,588,169 shares for future issuance under the
Company's 1997 Incentive Plan. The preceding table excludes options that have
been granted to purchase 644,097 shares with an exercise price of $ per
share, all of which have been granted since December 31, 1996. See
"Management -- Employee Benefit Plans -- 1997 Incentive Plan," Note 3 of Notes
to Balance Sheet and Note 8 of Notes to Financial Statements.

18
<PAGE> 20

CAPITALIZATION

The following table sets forth the capitalization of the Company (i) as of
December 31, 1996, (ii) pro forma to give effect to the Exchange and (iii) pro
forma as adjusted for the Offering and the application of the estimated $
million in net proceeds described under "Use of Proceeds." The table should be
read with "Management's Discussion and Analysis of Financial Condition and
Results of Operations," the Unaudited Pro Forma Financial Statements, and the
Financial Statements and notes thereto in this Prospectus.

<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1996
---------------------------------
PRO FORMA
ACTUAL PRO FORMA AS ADJUSTED
------- --------- -----------
(IN THOUSANDS)
<S> <C> <C> <C>
Total debt(1):
Notes payable...................................... $ 8,000 $ 8,000 $ --
Subordinated notes payable......................... 16,000 -- --
------- ------- -------
24,000 8,000 --
Partners' capital and stockholders' equity:
Partners' capital.................................. 3,244 -- --
Preferred Stock, $.01 par value, 10,000,000 shares
authorized; no shares outstanding actual, pro
forma and pro forma as adjusted................. -- -- --
Common Stock, $.01 par value, 30,000,000 shares
authorized; no shares issued and outstanding
actual; 8,928,571 shares issued and outstanding
pro forma; and shares issued and
outstanding pro forma as adjusted(2)............ -- 89
Additional paid-in capital......................... -- 25,115
Unearned stock compensation........................ -- (5,527)
Accumulated deficit................................ -- (5,112)
------- ------- -------
Total partners' capital and stockholders' equity... 3,244 14,565
------- ------- -------
Total capitalization................................. $27,244 $22,565 $
======= ======= =======
</TABLE>

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

(1) See Note 4 of Notes to Financial Statements.

(2) Excludes 1,588,169 shares of Common Stock the Company has reserved for
future issuance under the Company's 1997 Incentive Plan, of which options
have been granted since December 31, 1996 to purchase 644,097 shares with an
exercise price equal to $ per share. See "Management -- Employee
Benefit Plans 1997 Incentive Plan," Note 3 of Notes to Balance Sheet and
Note 8 of Notes to Financial Statements.

19
<PAGE> 21

SELECTED FINANCIAL DATA

The following selected financial data should be read in conjunction with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," the Unaudited Pro Forma Financial Statements and notes thereto, and
the Financial Statements and notes thereto included elsewhere in this
Prospectus. All financial data presented, other than pro forma data, below are
derived from audited financial statements.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------------
1992(1) 1993 1994 1995 1996
------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues:
Natural gas and oil sales...... $ 244 $ 937 $ 2,565 $ 3,578 $ 6,141
Workstation revenue............ 252 467 815 635 627
------- ------- ------- ------- --------
Total revenues............ 496 1,404 3,380 4,213 6,768
Costs and expenses:
Lease operating................ 32 111 491 761 726
Production taxes............... 12 47 126 165 362
General and administrative..... 462 1,433 1,785 1,897 2,199
Depletion of natural gas and
oil properties............... 127 4,371(2) 1,104 1,626 2,323
Depreciation and
amortization................. 224 406 561 533 487
------- ------- ------- ------- --------
Total costs and
expenses................ 857 6,368 4,067 4,982 6,097
------- ------- ------- ------- --------
Operating income (loss)........... (361) (4,964) (687) (769) 671
Other income (expense):
Interest income................ 12 6 56 128 52
Interest expense............... (21) (105) (668) 936 (1,773)
------- ------- ------- ------- --------
Net loss.......................... $ (370) $(5,063) $(1,299) $(1,577) $ (450)
======= ======= ======= ======= ========

PRO FORMA STATEMENT OF OPERATIONS
DATA:
Net income (loss)(3)(4)........... $ (386)
Net income (loss) per
share(3)(4).................... $ (0.04)
Weighted average shares
outstanding(3)................. 9,343

STATEMENT OF CASH FLOWS DATA:
Net cash provided by (used in)
operating activities........... $ (172) $ (730) $ 626 $ 1,383 $ 3,710
Net cash used in investing
activities..................... (3,931) (6,983) (5,463) (8,005) (11,796)
Net cash provided by financing
activities..................... 4,845 7,839 4,634 7,724 7,731

OTHER FINANCIAL DATA:
Capital expenditures.............. $ 4,285 $ 6,632 $ 5,445 $ 7,935 $ 13,612
EBITDA(5)......................... 2 (181) 1,034 1,518 3,533
Cash flow from operations(6)...... (18) (285) 366 582 2,360
</TABLE>

20
<PAGE> 22

<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1996
--------------------------------------------
PRO FORMA
ACTUAL PRO FORMA(3) AS ADJUSTED(3)(7)
------- ------------ -----------------
<S> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents......................... $ 1,447 $ 1,447
Natural gas and oil properties, net............... 28,005 28,005
Total assets...................................... 33,614 33,614
Notes payable..................................... 24,000 8,000
Total equity...................................... 3,244 14,565
</TABLE>

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

(2) Includes a capitalized ceiling impairment of $3.3 million in 1993.

(7) As adjusted for the Offering and the application of the estimated $
million in net proceeds. See "Use of Proceeds."

21
<PAGE> 23

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

OVERVIEW

The Company is an independent exploration and production company focused on
the use of 3-D seismic imaging and other advanced technologies to systematically
explore and develop onshore domestic natural gas and oil provinces. Brigham has
acquired over 3,300 square miles of 3-D seismic, identified approximately 1,200
potential drilling locations and drilled over 300 wells. The Company believes
this performance demonstrates a systematic methodology for finding natural gas
and oil in onshore domestic natural gas and oil provinces.

Combining its geologic and geophysical expertise with a sophisticated land
effort, the Company manages the majority of its projects from conception through
3-D acquisition, processing and interpretation and leasing. Because it generates
most of its projects, the Company can control the size of the working interest
that it retains as well as the selection of the operator and the non-operating
participants. Additionally, the Company manages the negotiation and drafting of
most of its geophysical exploration agreements, resulting in reduced contract
risk and more consistent deal terms. In 1995, the Company began to manage
operations, on a limited basis, through the drilling and production phases. The
Company had discovered an aggregate of 264.2 Bcfe of proved reserves as of
December 31, 1996. However, primarily due to capital constraints the Company
retained an interest in only approximately 14% of the reserves discovered, or
37.5 Bcfe. Brigham is endeavoring to increase its working interest in its
projects, based on capital availability and perceived risk, and plans to use a
portion of the proceeds of the Offering to retain a larger portion of the value
it creates.

Expenditures made in natural gas and oil exploration vary from project to
project depending primarily on the costs related to land, seismic acquisition,
drilling costs and the working interest retained by the Company. Typically, the
Company's participants bear a disproportionate share of the costs of optioning
available acreage and acquiring, processing and interpreting the 3-D seismic
data, and the Company and its participants each bear leasing, drilling and
completion costs in proportion to their ownership interests.

From inception through 1993, the Company acquired 1,373 square miles of 3-D
seismic in 63 projects. The majority of the Company's 3-D seismic acquisitions
were concentrated in the Horseshoe Atoll and Eastern Shelf of the Permian Basin
and the Hardeman Basin of West Texas. The Company drilled seventy-nine 3-D
delineated wells during this period, increasing its revenues from natural gas
and oil production to $936,634 in 1993. The Company's production volumes
consisted of 85% oil on an equivalent basis. The Company's average working
interest in these wells was 14%. In 1992, the Company increased its capacity to
finance its project generation and drilling activities through a $10.0 million
private placement of equity. This financing partially funded the Company's
acquisition of 908 square miles of 3-D seismic data in 32 projects in 1993,
which contributed to the Company's reserve growth in subsequent years. The
Company also issued $3.0 million of 10% Senior Secured General Obligation Notes
(the "10% Notes").

During 1994, the Company acquired 423 square miles of 3-D seismic in 16
projects, primarily in the Horseshoe Atoll and Eastern Shelf areas of the
Permian Basin, the Hardeman Basin and the Anadarko Basin. The Company drilled
seventy-three 3-D delineated wells, increasing its revenues from natural gas and
oil production to $2.6 million. The Company's production volumes consisted of
84% oil on an equivalent basis. The Company's average working interest in wells
drilled in 1994 was 23%. To finance its project generation and drilling
activities, the Company supplemented cash flow from operations with capital from
the issuance of $5.0 million of its 10% Notes and the placement of working
interests in projects to industry participants. The Company's acquisition of
seismic data declined in 1994 compared to previous years as the Company
allocated a greater portion of its capital expenditure budget to drilling 3-D
delineated locations.

During 1995, the Company significantly expanded its efforts in the Anadarko
Basin of Texas and Oklahoma by acquiring 195 square miles of 3-D seismic in four
projects in this basin, and initiated its exploration program in the Gulf Coast
with the Esperson Dome Project (39 square miles of 3-D seismic). The Company
also continued its efforts in the Horseshoe Atoll and Eastern Shelf areas of the
Permian Basin and the Hardeman Basin by acquiring 77 square miles of 3-D
seismic. The Company drilled seventy-eight 3-D

22
<PAGE> 24

delineated wells, increasing its revenues from natural gas and oil production to
$3.6 million. The Company's production volumes consisted of 80% oil on an
equivalent basis. The Company's average working interest in wells drilled in
1995 was 24%. To finance its project generation and drilling activities the
Company supplemented cash flow from operations with capital from the issuance of
$2.6 million of the 10% Notes, the issuance of $16.0 million principal amount of
its 5% Convertible Unsecured Subordinated Notes (the "5% Notes") and the
placement of working interests in projects to industry participants. The Company
used $10.5 million of the proceeds from the issuance of the 5% Notes to retire
the then outstanding balance of the 10% Notes.

During 1996, the Company acquired 655 square miles of 3-D seismic data and
continued to focus the majority of its 3-D exploration efforts in the Anadarko
Basin and the Gulf Coast. The Company acquired 457 square miles (70%) of the 3-D
seismic data in eight projects in the Anadarko Basin, making this basin the most
active 3-D acquisition province for the Company in 1996. Brigham also
significantly increased its Gulf Coast activity, adding eight 3-D projects, and
continued to expand its operations through staff additions and opening a Houston
office in January 1997. While an increasing portion of the Company's capital was
dedicated to 3-D seismic and land acquisition and subsequent drilling in the
Anadarko Basin and the Gulf Coast, the Company continued to allocate a
significant amount of capital to the drilling of its potential drilling
locations in the West Texas region. The Company expects that its change in
geographic focus will result in a larger percentage of its reserves consisting
of natural gas. During 1996, the Company drilled sixty-eight 3-D delineated
wells, increasing its revenues from natural gas and oil production to $6.1
million. The Company's production volumes consisted of 66% of oil on an
equivalent basis. The Company's average working interest in wells drilled in
1996 was 24%. The Company's fourth quarter 1996 revenue from natural gas and oil
production increased to $1.9 million from $955,000 in the fourth quarter of
1995. The Company supplemented cash flow from operations with borrowings under
its Revolving Credit Facility, the sale of producing properties and the
placement of working interests in projects to industry participants to finance
its project generation and drilling activities.

The Company uses the full-cost method of accounting for its natural gas and
oil properties. Under this method, all acquisition, exploration and development
costs, including certain internal costs that are directly attributable to the
Company's acquisition, exploration and development activities, are capitalized
in the amortizable base of the "full-cost pool" as incurred. Upon the
interpretation by the Company of the 3-D seismic data associated with unproved
properties, the geological and geophysical costs of acreage that is not
specifically identified as prospective are transferred to the amortizable base.
Geological and geophysical costs associated with prospective acreage, as well as
leasehold costs, are transferred to the amortizable base when the prospects are
drilled. The Company records depletion of its full-cost pool using the unit of
production method. To the extent that the costs capitalized in the full-cost
pool (net of depreciation, depletion and amortization and related deferred
taxes) exceed the present value (using a 10% discount rate) of estimated future
net after-tax cash flows from proved natural gas and oil reserves plus the
capitalized cost of unproved properties, such costs are charged to operations.
Once incurred, a write-down of natural gas and oil properties is not reversed at
a later date. See Note 1 of Notes to Financial Statements.

In connection with the Exchange, the Company issued options to purchase
644,097 shares of Common Stock to certain of its officers and employees. The
Company recorded an unearned stock compensation balance of $5.5 million,
approximately one-half of which will be added to the amortizable base of the
"full cost" pool over the vesting period of the options and the balance will be
recorded as a noncash compensation expense of approximately $984,000 in 1997,
$714,000 in 1998 and an aggregate of $872,000 in the four years thereafter.

The Company's predecessor was classified as a partnership for federal
income tax purposes. Therefore, no income taxes were paid or provided for by the
Company prior to the Exchange. The Company is a taxable entity.

23
<PAGE> 25

RESULTS OF OPERATIONS

The following table sets forth certain operating data for the periods
presented.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------
1994 1995 1996
------ ------ ------
<S> <C> <C> <C>
Production:
Natural gas (MMcf)..................................... 165 272 698
Oil (MBbls)............................................ 140 177 227
Natural gas equivalent (MMcfe)......................... 1,002 1,332 2,060
Average sales prices per unit(1):
Natural gas (per Mcf).................................. $ 1.76 $ 1.62 $ 2.30
Oil (per Bbl).......................................... 16.30 17.76 19.98
Natural gas equivalent (per Mcfe)...................... 2.56 2.69 2.98
Costs and expenses per Mcfe:
Lease operating........................................ $ .49 $ .57 $ .35
General and administrative............................. 1.78 1.42 1.07
Depletion of natural gas and oil properties............ 1.10 1.22 1.13
</TABLE>

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

(1) Reflects the effects of the Company's hedging activities. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Other Matters -- Hedging Activities."

Year Ended December 31, 1996 Compared to Year Ended December 31, 1995

Natural gas and oil sales. Natural gas and oil sales increased 72% from
$3.6 million in 1995 to $6.1 million in 1996. Of this increase, $2.0 million or
76% was attributable to an increase in production, and $607,894 or 24% was
attributable to an increase in the average sales price received for natural gas
and oil. Production volumes for natural gas increased 157% from 271,707 Mcf in
1995 to 698,036 Mcf in 1996. The average price received for natural gas
increased 42% from $1.62 per Mcf in 1995 to $2.30 per Mcf in 1996. Production
volumes for oil increased 28% from 176,693 Bbls in 1995 to 226,925 Bbls in 1996.
The average price received for oil increased 13% from $17.76 per Bbl in 1995 to
$19.98 per Bbl in 1996. Natural gas and oil sales were increased by the
completion of 43 wells in 1996, which was partially offset by the sale of
certain producing properties in January 1996 and the natural decline of existing
production. Hedging activities in 1996 reduced the amount by which oil revenues
increased by $301,380, compared to an increase in oil revenues of $40,849 as a
result of hedging activities in 1995.

Workstation revenue. Workstation revenue decreased 1% from $635,401 in 1995
to $627,255 in 1996, primarily as a result of a decrease in the rate at which
3-D seismic data were acquired in 1995 and interpreted in 1996. Workstation
revenue is recognized by Brigham as industry participants in the Company's
seismic programs are charged an hourly rate for the work performed by the
Company on its 3-D seismic interpretation workstations. The Company expects an
increase in workstation revenues in 1997 due to the increase in square miles of
3-D seismic acquired in 1996. Workstation revenue is expected to decline after
1997 due to the Company's increasing its interest in the square miles of 3-D
seismic acquired beginning in 1997, reducing the net hours billed to its
participants.

Lease operating expenses. Lease operating expenses decreased 5% from
$760,784 ($.57 per Mcfe) in 1995 to $725,785 ($.35 per Mcfe) in 1996. The
decrease is primarily due to the sale of certain producing properties in January
1996 partially offset by an increase in producing wells. The decrease in the per
unit rate was a result of the sale of higher cost oil wells in January 1996 and
an increase in the percentage of production from natural gas wells.

General and administrative expenses. General and administrative expenses
increased 16% from $1.9 million ($1.42 per Mcfe) in 1995 to $2.2 million ($1.07
per Mcfe) in 1996. Approximately $110,000 of the increase in 1996 resulted from
salary increases for existing employees, and the rest is primarily attributable
to an increase in third-party consulting fees. The decrease in the per unit rate
was a result of the increase in natural gas and oil production from 1995 to
1996. The Company expects general and administrative expenses

24
<PAGE> 26

to increase in 1997, primarily as a nonrecurring expense related to relocating
its principal executive office to Austin, Texas and personnel hired as the
Company's operations grow.

Depletion of natural gas and oil properties. Depletion of natural gas and
oil properties increased 43% from $1.6 million ($1.22 per Mcfe) in 1995 to $2.3
million ($1.13 per Mcfe) in 1996 as a result of higher production volumes.

Interest expense. Interest expense increased 25% from $936,266 in 1995 to
$1.2 million in 1996. This increase was due to a higher average outstanding debt
balance in 1996, which was partially offset by a lower effective interest rate.
The weighted average outstanding debt balance increased 71% from approximately
$11.5 million in 1995 to $19.7 million in 1996. The effective interest rate
decreased 25% from 7.6% in 1995 to 5.7% in 1996. The increase in the weighted
average outstanding debt balance and decrease in the effective interest rate
resulted primarily from the retirement of the 10% Notes and the issuance of
$16.0 million in principal amount of the 5% Notes in August 1995. The Company
entered into the Revolving Credit Facility in April 1996, which had an effective
interest rate of 7.9% at December 31, 1996.

Year Ended December 31, 1995 Compared to Year Ended December 31, 1994

Natural gas and oil sales. Natural gas and oil sales increased 39% from
$2.6 million in 1994 to $3.6 million in 1995. Of this increase, $843,635 or 83%
was attributable to an increase in production and $168,785 or 17% was
attributable to an increase in the average sales price received for natural gas
and oil. Production volumes for natural gas increased 65% from 164,893 Mcf in
1994 to 271,707 Mcf in 1995. The average price received for natural gas
decreased 8% from $1.76 per Mcf in 1994 to $1.62 per Mcf in 1995. Production
volumes for oil increased 27% from 139,560 Bbls in 1994 to 176,693 Bbls in 1995.
The average price received for oil increased 9% from $16.30 per Bbl in 1994 to
$17.76 per Bbl in 1995. Natural gas and oil sales were increased by the
completion of 46 wells in 1995, which was partially offset by the natural
decline of existing production.

Workstation revenue. Workstation revenue decreased 22% from $814,841 in
1994 to $635,401 in 1995, primarily as a result of a decrease in the rate at
which 3-D seismic data were acquired in 1994 and interpreted in 1995.

Lease operating expenses. Lease operating expenses increased 55% from
$491,047 ($.49 per Mcfe) in 1994 to $760,784 ($.57 per Mcfe) in 1995. The
increase was primarily due to an increase in production from new wells and an
increase in the per unit rate. The per unit rate increase was due to natural
production decline in existing wells relative to the cost of operating the
wells.

General and administrative expenses. General and administrative expenses
increased 6% from $1.8 million ($1.78 per Mcfe) in 1994 to $1.9 million ($1.42
per Mcfe) in 1995. The increase was related to salary increases for existing
employees. The decrease in the per unit rate was the result of the increase in
natural gas and oil production from 1994 to 1995.

Depletion of natural gas and oil properties. Depletion of natural gas and
oil properties increased 47% from $1.1 million ($1.10 per Mcfe) in 1994 to $1.6
million ($1.22 per Mcfe) in 1995, as a result of higher production volumes and
per unit rates.

Interest expense. Interest expense increased 40% from $667,418 in 1994 to
$936,266 in 1995. This increase was due to a higher average outstanding debt
balance partially offset by a lower effective interest rate in 1995. The
weighted average outstanding debt balance increased 95% from approximately $5.9
million in 1994 to $11.5 million in 1995. The effective interest rate decreased
24% from 10.0% in 1994 to 7.6% in 1995. The increase in the weighted average
outstanding debt balance and decrease in the effective interest rate resulted
from the retirement of the 10% Notes and the issuance of $16.0 million in
principal amount of the 5% Notes in August 1995.

25
<PAGE> 27

LIQUIDITY AND CAPITAL RESOURCES

The Company's primary sources of capital have been borrowings (primarily
the 10% Notes, the 5% Notes and the Revolving Credit Facility), equity capital
from private sources, the sale of interests in projects and funds generated by
operations. The Company's primary capital requirements are 3-D seismic and land
acquisition costs and drilling expenditures.

Revolving Credit Facility. In April 1996, the Company entered into the
Revolving Credit Facility with Bank One, Texas, NA ("Bank One"). This facility
has a three-year term and provides for a maximum borrowing base of $25.0
million, subject to certain borrowing base limitations. Principal outstanding is
due at maturity on March 31, 1999 with interest due monthly. On January 31,
1997, the borrowing base was $11 million and borrowings outstanding under the
Revolving Credit Facility were $9.6 million. The Company intends to repay the
balance then outstanding under the Revolving Credit Facility (approximately $11
million) with a portion of the net proceeds from the Offering. The Revolving
Credit Facility will remain in place, although the Company intends to reduce the
borrowing base in the future.

The borrowing base is determined semiannually, in March and September,
based upon the Company's proved natural gas and oil reserves. The interest rate
for borrowings under the Revolving Credit Facility is either the lender's base
rate or LIBOR plus from 1.75% to 2.25%, depending on the amounts outstanding.
The Company is subject to typical covenants and restrictions under the terms of
the Revolving Credit Facility. The Company's obligations under the Revolving
Credit Facility are secured by substantially all of the natural gas and oil
properties of the Company. See Note 4 of Notes to Financial Statements.

5% Notes. In August 1995, the Company entered into a note purchase
agreement with RIMCO under which RIMCO purchased $16.0 million in convertible
subordinated notes due September 1, 2002. These notes were unsecured and bore
interest at 5% per annum, of which 3% was currently payable and 2% was deferred
and payable at the maturity date. The balance outstanding under the 10% Notes
was retired with a portion of the proceeds from the issuance of the $16.0
million in principal amount of the 5% Notes. RIMCO converted these notes and the
deferred interest thereon into a 19.65% equity interest in the Company in
February 1997. The Company will pay RIMCO an amount equal to the interest the
Company would have paid on the 5% Notes through the earlier to occur of the
closing of the Offering or September 30, 1997. See Note 4 of Notes to Financial
Statements.

Cash Flow Analysis

Cash Flows from Operating Activities. Cash flows provided by operating
activities were $3.7 million in 1996, $1.4 million in 1995 and $626,205 in 1994.
Increase in cash flows for 1996 compared to 1995 was due primarily to an
increase in natural gas and oil revenues, net of lease operating expenses,
production taxes and general and administrative expenses. The increase in cash
flows for 1995 compared to 1994 was due primarily to an increase in natural gas
and oil revenues, net of lease operating expenses, production taxes and general
and administrative expenses, and changes in balance sheet items.

Cash Flows from Investing Activities. Cash flows used in investing
activities increased to $11.8 million in 1996 compared to $7.9 million in 1995
and $5.5 million in 1994. These increases are directly related to an increase in
capital expenditures. Capital expenditures were $13.6 million in 1996, $8.2
million in 1995 and $5.4 million in 1994. The Company acquired 655 square miles
of 3-D seismic data in 1996, 311 square miles in 1995 and 323 square miles in
1994. The Company's drilling efforts resulted in the successful completion of 42
wells (8.5 net) in 1996, 46 wells (9.9 net) in 1995 and 45 wells (10.3 net) in
1994, which resulted in aggregate increases in PV-10 of $31.1 million in 1996,
$8.7 million in 1995 and $8.2 million in 1994. In 1996, the Company sold
producing properties for $2.2 million.

Cash Flows from Financing Activities. Cash flows from financing activities
for 1996 were $7.7 million, primarily as a result of borrowings under the
Revolving Credit Facility. Cash flows from financing activities for 1995 were
$7.7 million, primarily a result of the issuance of the 5% Notes offset by the
net repayment of the $7.9 million outstanding balance on the 10% Notes. Cash
flows from financing activities for 1994 were $4.6 million, primarily a result
of issuances of the 10% Notes.

26
<PAGE> 28

Capital Expenditures

The Company estimates capital expenditures in 1997 will be at least $27
million. The Company expects to incur these capital expenditures primarily to
drill 91 gross (23.8 net) planned wells, acquire approximately 1,400 square
miles of 3-D seismic data and continue to add to and upgrade its 3-D seismic
interpretation hardware and software. The actual number of wells drilled and
square miles acquired may differ significantly from these estimates. See
"Business and Properties -- Primary Exploration Provinces."

Due to the Company's active 3-D seismic acquisition and drilling programs,
the Company has experienced and expects to continue to experience substantial
working capital requirements. While the Company believes that the net proceeds
from the Offering, cash flow from operations and borrowings under the Revolving
Credit Facility should allow the Company to finance its operations at least
through 1998 based on current conditions, additional financing may be required
in the future to fund the Company's 3-D seismic acquisition and drilling
programs. In the event additional financing is not available, the Company may be
required to curtail these activities.

OTHER MATTERS

Hedging Activities

In 1995 the Company began using certain financial swaps to hedge a portion
of its oil production to reduce its sensitivity to volatile commodity prices.
The Company believes that hedging, although not free of risk, allows the Company
to achieve a more predictable cash flow and to reduce exposure to price
fluctuations. However, hedging arrangements, when utilized, limit the benefit to
the Company of increases in the prices of the hedged commodity. Moreover, the
Company's hedging arrangements apply only to a portion of its oil production and
provide only partial price protection against declines in oil prices. Such
hedging arrangements may expose the Company to risk of financial loss in certain
circumstances. See "Risk Factors -- Risk of Hedging Activities." Total oil
purchased and sold under the swap arrangements was 118,150 Bbls in 1996 and
54,900 Bbls in 1995. The Company accounts for all these transactions as hedging
activities and, accordingly, adjusts the price received for oil and gas
production during the period the hedged transactions occur. Adjustments to the
price received for oil under the swap arrangement resulted in an increase in oil
revenues of $40,849 in 1995 and a decrease in oil revenues of $301,280 in 1996.
There was no hedging in 1994. The Company expects that the amount of its hedges
will vary from time to time. Outstanding hedges at December 31, 1996 were 37,750
Bbls.

Effects of Inflation and Changes in Prices

The Company's results of operations and cash flows are affected by changing
natural gas and oil prices. If the price of natural gas and oil increases
(decreases), there could be a corresponding increase (decrease) in revenues as
well as the operating costs that the Company is required to bear for operations.
Inflation has had a minimal effect on the Company.

Environmental and other Regulatory Matters

The Company's business is subject to certain federal, state and local laws
and regulations relating to the exploration for and the development, production
and transportation of, natural gas and oil, as well as environmental and safety
matters. Many of these laws and regulations have become more stringent in recent
years, often imposing greater liability on a larger number of potentially
responsible parties. Although the Company believes it is in substantial
compliance with all applicable laws and regulations, the requirements imposed by
laws and regulations are frequently changed and subject to interpretation, and
the Company is unable to predict the ultimate cost of compliance with these
requirements or their effect on its operations. Any suspensions, terminations or
inability to meet applicable bonding requirements could materially adversely
affect the Company's financial condition and operations. Although significant
expenditures may be required to comply with governmental laws and regulations
applicable to the Company, compliance has not had a material adverse effect on
the earnings or competitive position of the Company. Future regulations may add
to the cost of, or significantly limit, drilling activity. See "Risk
Factors -- Compliance with Environmental Regulations,"

27
<PAGE> 29

"Business and Properties -- Governmental Regulation" and "Business and
Properties -- Environmental Matters."

BUSINESS AND PROPERTIES

Since inception in 1990, Brigham has drilled over 265 exploratory and 35
development wells on its 3-D generated prospects with an aggregate 63% success
rate. From January 1, 1994 through December 31, 1996, the Company had achieved
finding and development costs of $1.05 per Mcfe. These costs included 3-D
seismic and land costs for all of the Company's 3-D delineated locations, of
which it had only drilled a portion. For the same period, the Company achieved a
drilling cost of $.68 per Mcfe of reserves discovered and, in 1996, achieved a
drilling cost of $.38 per Mcfe of reserves discovered.

Through December 31, 1996, the Company had discovered total estimated
reserves of 119.7 Bcf of natural gas and 24.1 MMBbls of oil, or an aggregate of
264.2 Bcfe, 14% of which is attributable to the Company's interest. The
Company's estimated proved reserves as of December 31, 1996 were 21.9 Bcfe
having an aggregate Present Value of Future Net Revenues of $44.5 million,
compared to estimated proved reserves as of December 31, 1993 of 2.2 Bcfe having
an aggregate Present Value of Future Net Revenues of $3.2 million.

The Company pioneered the acquisition of large scale onshore 3-D seismic
surveys for exploration, obtaining extensive 3-D seismic data and experience in
capturing undiscovered natural gas and oil reserves. Brigham has acquired over
3,300 square miles (2,112,000 acres) of 3-D seismic data and, from the 2,837
square miles that have been interpreted to date, has identified approximately
1,200 potential drilling locations. Brigham has drilled over 300 of these
locations with an average working interest of 21%. The Company generates most of
its exploratory projects and, therefore, has the ability to retain a sizeable
working interest to the extent that it decides not to place interests with
industry participants. In the projects in which it is currently acquiring 3-D
seismic data, the Company may retain an average working interest in the drilling
and leasing phases in excess of 60%.

BUSINESS STRATEGY

Brigham's exploration activities are concentrated primarily in three
provinces: the Anadarko Basin, the Gulf Coast and the West Texas region. The
Company is accelerating 3-D seismic activity in the Anadarko Basin and the Gulf
Coast and will continue such activity in those geologic trends of the West Texas
region where it has achieved its best results historically. Brigham is focusing
its 3-D seismic activity in provinces where it believes 3-D technology may be
effectively applied and the Company believes offer large potential reserve
volumes per well and per field, high potential production rates and multiple
producing objectives.

28
<PAGE> 30

COMPETITIVE ADVANTAGES

Brigham believes that its knowledge base, personnel and technology provide
it with the following competitive advantages to capture undiscovered natural gas
and oil reserves.

Pioneering Innovations. In 1990 the Company pioneered the assemblage
of large scale onshore 3-D seismic projects and the use of preseismic lease
options for the systematic exploration of proven natural gas and oil
provinces. The Company believes it was the first to form alliances and
joint participation arrangements with companies and individuals possessing
extensive local geologic or operating expertise to complement its 3-D
exploration expertise. Subsequent innovations include the Company's 3-D
seismic acquisition and processing alliances and its creative industry
trade structures to financially leverage its drilling program.

3-D Seismic Knowledge Base. The Company began acquiring 3-D seismic in
1990 and drilled its first 3-D delineated well, which was a discovery, in
February 1991. Since inception, the Company has acquired over 3,300 square
miles of 3-D seismic data and drilled more than 300 wells in over 20
geologic trends in six basins and seven states. As a result, the Company
has gained extensive technological and economic knowledge relating to the
application of 3-D seismic to different geologic trends. This experience
and knowledge enable the Company to refine its exploration techniques and
identify exploration areas where Brigham believes 3-D seismic can be
applied to reduce risks and enhance returns on its investments.

Technological Expertise. Led by its CEO, who is an experienced,
practicing geophysicist, the Company has built an exploration staff that
includes nine other geophysicists and six geologists. Brigham's
explorationists collectively have over 200 years of experience, including
over 65 years of experience using CAEX workstations, and have expertise in
many geologic trends. The Company makes extensive use of advanced
technologies, including 3-D seismic imaging and CAEX and in-house
analytical and processing capabilities, to define drilling prospects. To
support the efforts of its explorationists, Brigham has made significant
investments in advanced hardware and software, including twelve UNIX-based
CAEX workstations.

Project Generation and Control. Brigham is not dependent on third
parties for its project flow, having generated approximately 90% of its 3-D
exploration projects. Therefore, the Company is able to manage the
predrilling exploration phases, from project conception and assemblage
through 3-D data acquisition, processing and interpretation and subsequent
leasing. Brigham believes that its management of the exploration process
enhances project quality and compresses the cycle time, contributing to
lower finding and development costs and an enhanced project rate of return.
Furthermore, the Company can determine the level of working interest it
retains and the extent to which it manages drilling and post-drilling
operations and continues to expand its efforts in these areas.

Numerous Potential Drilling Locations. The Company has identified
approximately 1,200 3-D defined potential drilling locations in
historically productive geologic trends, of which over 300 have been
drilled. The Company anticipates drilling 91 of these locations (23.8 net)
in 1997 at a cost of approximately $16 million. The Company also
anticipates acquiring approximately 1,400 square miles of 3-D seismic data
in 1997 at a net cost to the Company of approximately $5.6 million. The
Company continually evaluates and prioritizes potential locations to
determine whether to drill them, farm them out or replace them with higher
quality locations.

EXPLORATION AND OPERATING APPROACH

The Company has acquired 3-D seismic data in 113 projects covering over
3,300 square miles (2,112,000 acres) in 20 geologic trends in six basins and
seven states. Through this activity, the Company has developed expertise in the
selection of geologic trends that are suitable for 3-D seismic exploration.
Brigham uses experience that it gains within a trend to enhance the quality of
subsequent projects in the same trend and other analogous trends, contributing
to lower finding and development costs, compressing project cycle times and
increasing project rates of return.

29
<PAGE> 31

The Company typically acquires 3-D seismic data in and around existing
production where the Company can benefit from the mapping of producing analogs.
These 3-D defined analogs, combined with the Company's experience in drilling
over 300 wells, provide the Company a knowledge base to evaluate other potential
geologic trends, 3-D seismic projects within trends and evaluate delineated
potential drilling locations. The Company believes that this experience is a
major factor in the Company's success to date and that this knowledge base
differentiates the Company from its competitors. The Company's knowledge base
assists in identifying geologic trends where Brigham believes it can find and
develop large volumes of natural gas and oil at a low relative cost.

The Company has experience in a wide range of reservoir types and geologic
trapping styles, both stratigraphic and structural (including reefs, salt domes,
channel sands, complex faulted and fractured reservoirs and pinchout plays). The
Company seeks to supplement its knowledge base with the best local geologic
expertise available for a particular geologic trend by hiring new
explorationists, engaging consultants and entering into joint ventures with
industry participants. In addition, if the targeted geologic trend is extensive,
the Company typically acquires a digital data base for integration on the
Company's CAEX workstations, including digital land grids, well information, log
curves, production information, geologic studies, geologic top data bases and
existing 2-D seismic data.

The Company uses its knowledge base, local geological expertise and
acquired digital data bases to create 3-D maps of producing reservoirs. The
Company believes its maps are more accurate than previous reservoir maps (which
generally were based on subsurface geological information and surface surveys),
enabling the Company to more precisely evaluate recoverable reserves and the
economic feasibility of projects and drilling locations.

PRIMARY EXPLORATION PROVINCES

Brigham's exploration activities are concentrated primarily in three
provinces: the Anadarko Basin, the Gulf Coast and the West Texas region. Brigham
is accelerating 3-D seismic activity in the Anadarko Basin and the Gulf Coast
and will continue such activity in those geologic trends of the West Texas
region where it has achieved its best results historically. Brigham is focusing
its 3-D seismic exploration efforts in provinces where it believes 3-D
technology may be effectively applied and the Company believes offer large
potential reserve volumes per well and per field, high potential production
rates and multiple producing objectives.

<TABLE>
<CAPTION>
ADDITIONAL 3-D 1997
SEISMIC DATA ADDITIONAL BUDGETED ESTIMATED
3-D SEISMIC BUDGETED FOR TOTAL GROSS POTENTIAL WELLS 1997
DATA ACQUIRED/ ACQUISITION WELLS DRILLED DRILLING ------------ CAPITAL
PROVINCE INTERPRETED(1) IN 1997 THROUGH 1996 LOCATIONS(2) GROSS NET EXPENDITURES(3)
-------- -------------- -------------- ------------- ------------ ----- ---- ---------------
(SQUARE MILES) (SQUARE MILES) (IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Anadarko Basin........ 1,043/942 493 31 325 41 12.3 $15,000
Gulf Coast............ 533/154 191 1 31 7 2.2 7,000
West Texas Region..... 1,552/1,552 68 255 508 41 8.2 4,000
Other(4).............. 215/189 60 11 30 2 1.1 1,000
----------- --- --- --- -- ---- -------
Total................. 3,343/2,837 812(5) 298 894 91 23.8 $27,000
=========== === === === == ==== =======
</TABLE>

30
<PAGE> 32

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

(1) 3-D seismic data that had been or was being acquired/interpreted on February
15, 1997.

(2) The potential drilling locations that had been identified from the portion
of the 3-D seismic data that had been interpreted by February 15, 1997.

(3) 3-D seismic and land acquisition costs and drilling expenditures.

(4) Colorado, Kansas and Montana.

(5) The Company has budgeted approximately 1,400 square miles of 3-D seismic
data for acquisition in 1997, 582 of which had been acquired or were being
acquired on February 15, 1997.

Following its initial 3-D seismic acquisition in the province in 1991 (12.5
square miles), the Company acquired 51 square miles of 3-D seismic in 1993. Over
the last several years the Company has accelerated its activity in the Anadarko
Basin, acquiring 151 square miles of 3-D seismic in 1994, 195 square miles in
1995 and 457 square miles in 1996. The Company retained a 33% average working
interest in the 3-D seismic data it acquired in this province in 1996. The
Company believes its increased level of activity in the Anadarko Basin will be a
significant factor in the Company's growth. On February 15, 1997, the Company
had acquired or was acquiring 1,043 square miles (667,520 acres) of 3-D seismic
data in 24 projects in the Anadarko Basin.

An example of the Company's success in the Anadarko Basin is the Foster
well, drilled late in 1996 in Lipscomb County, Texas. Identified through the
Company's interpretation of its 40 square mile 3-D program, the Foster well was
drilled to a depth of 10,550 feet, where it encountered 54 feet of gross pay, 33
feet net. The well, in which Brigham has a 22.5% working interest, is currently
producing approximately 4.4 MMcf of gas per day. The field in which the well is
producing is estimated to have total recoverable reserves of 13.2 Bcf of natural
gas from the Foster well and two proved undeveloped locations that the Company
plans to drill in 1997. Brigham has spud an exploratory test well on an
analogous prospect in the same project and plans to test other analogous
prospects in 1997. The Company is currently processing a 43 square mile 3-D
project, in which it currently has retained a 37.5% project working interest,
adjacent to the Foster well.

In 1997, the Company plans to drill at least three exploratory wells to
test 3-D delineated Hunton structural prospects in which the Company's working
interest currently ranges from 25% to 42%. These prospects are adjacent to
prolific production from the Hunton formation in fields such as Buffalo Wallow
(approximately 350 Bcfe), Mathers Ranch (approximately 186 Bcfe) and Wheeler Pan
(approximately 130 Bcfe).

As of February 15, 1997, the Company had acquired 1,043 square miles
(667,520 acres) in 24 projects in the Anadarko Basin. As of December 31, 1996,
Brigham had completed 23 wells in 31 attempts (a 74% success rate) in this
province and had found cumulative proved reserves of 53.4 Bcf of natural gas and
1.7 MMBbls of oil, or an aggregate of 63.4 Bcfe, with 16.3% attributable to the
Company's interest. From inception to December 31, 1996, the Company incurred
drilling costs in this province of $.48 per Mcfe. In 1996, the Company completed
14 wells in 20 attempts, adding 38.8 Bcfe of proved reserves, with 6.7 Bcfe
attributable to the Company's interest, at a drilling cost of $.27 per Mcfe. As
of February 15, 1997, the Company had 325 3-D delineated potential drilling
locations in the Anadarko Basin, of which the Company intends to drill 41 gross
(12.3 net) wells in 1997.

31
<PAGE> 33

Gulf Coast. The Gulf Coast is a high potential, multi-pay province that
lends itself to 3-D seismic exploration due to its substantial structural and
stratigraphic complexity. The Company has assembled a digital data base
including geographical, production, geophysical and geological information that
the Company evaluates on its CAEX workstations. Working with consulting regional
geologists the Company's explorationists integrate this data with their
extensive expertise and knowledge base to generate 3-D projects in the Gulf
Coast. Brigham's commitment to this province is evidenced by the Company's staff
additions, the opening of its Houston office and the addition of ten new 3-D
seismic projects in 1996 and 1997.

Brigham initiated its Gulf Coast effort in 1995 with the Esperson Dome
Project in Liberty County, Texas where the Company and its partners currently
control 9,657 gross acres (7,480 net) through leases and farmouts and have
acquired 39 square miles of seismic data. The Company financed its participation
in this project through off-balance sheet financing. Brigham is not required to
invest capital for its interest until payout, when it earns a variable backin
working interest of 12 to 20%. Because payout has not yet occurred, no reserves
or production are attributed to this project. The Esperson Dome Field has
produced in excess of 59 MMBbl of oil and 60 Bcf of natural gas to date from a
section of sands in the Miocene, Vicksburg and Yegua/Cook Mountain series
ranging in depth from 1,200 feet to 10,000 feet. The Company has drilled four
wells in the project to date (one Yegua/Cook Mountain and three Vicksburg)
yielding two discoveries. The most significant of these discoveries was drilled
and completed in January 1997 and found over 70 feet of gross pay (65 feet net
pay) in a Vicksburg sand at a depth of 5,300 feet. This well tested for 352 Bbls
of oil and 400 Mcf of natural gas per day from approximately 20 feet of
perforations. Gross reserves attributed to this discovery (including three
development locations) are approximately 1.5 MMBbls of oil with associated
natural gas. An additional 11 Vicksburg prospects have been identified in the
project, several of which could have development potential. Brigham also plans
to drill additional wells testing potential prospects in the shallower Miocene
sands and the deeper Yegua/Cook Mountain Sands in the Esperson Dome Project.

In 1996 the Company initiated the Welder Ranch Project in the South Texas
Expanded Wilcox geologic trend where the Company currently controls 18,064 gross
acres (17,957 net). In and immediately adjacent to the project area significant
production has been established from prospective pay zones ranging in depth from
1,600 feet in the Queen City sands to over 16,000 feet in the Lower Wilcox
sands. The East Seven Sisters Field located on the north end of the project area
is producing from the Lower Wilcox and has cumulative production exceeding 360
Bcf of natural gas. Recent exploration by Sonat, Inc. on a 1,000 acre block
located in the interior of the Company's acreage block has yielded two
significant Lower Wilcox wells with each producing approximately 6 MMcf of
natural gas per day, and a third well is currently drilling. Brigham is
currently in the process of acquiring a 50 square mile 3-D survey over the
Welder Ranch Project that it expects to begin processing in the third quarter of
1997 and in which the Company plans to retain a 70% working interest. In
addition to the extensive exploration potential associated with this project,
Brigham also expects to delineate several low risk development locations
adjacent to the recent Sonat activity. The Company is also participating in a
356 square mile 3-D seismic program immediately adjacent to the Welder Ranch
Project.

The Company is also undertaking exploratory projects in the prolific
Miocene trend in South Louisiana. The Company's Tigre Point Project is located
immediately south of the developing Freshwater Bayou Field where Unocal and
others have seven wells currently producing over 260 MMcf of natural gas per day
(an average of over 37 MMcf of natural gas per day from each well) from a lower
Miocene sand. This project also offers several shallower objectives as
attractive secondary targets.

32
<PAGE> 34

Coast of Texas. The Company has thirty-one 3-D delineated potential drilling
locations in the Gulf Coast and intends to drill 7 gross (2.2 net) wells in
1997.

West Texas Region. The Company's 3-D seismic drilling activity in the West
Texas region has been focused in the Horseshoe Atoll, the Midland Basin and the
Eastern Shelf of the Permian Basin and the Hardeman Basin. The Company plans to
continue drilling its locations in these areas. Recently the Company initiated
an exploration program in the Delaware Basin and significantly increased its
activity in portions of geologic trends that the Company believes offer greater
potential for lower finding costs and higher returns, including the Ellenberger
and Devonian formations of the Delaware Basin and the Fusselman formation of the
Midland Basin.

One area in which the Company increased its activity is the Midland Basin,
where the Company has drilled five Fusselman discoveries and has acquired or
intends to acquire 3-D seismic in four additional projects, in which it expects
to retain working interests in excess of 50%. Currently the most significant of
these discoveries is the Elizabeth Rose Field, with gross proved reserves
estimated by Cawley Gillespie at December 31, 1996 at 2.1 MMBbls of oil. The
Company has drilled three wells in this Fusselman field that are producing a
total of approximately 500 Bbls of oil per day. Brigham's working interest in
the five Fusselman discoveries ranges from 18.75% to 38.5%. In addition, the
Company owns a 25% to 100% working interest in an additional fifty 3-D defined
potential drilling locations in the adjoining four projects. In 1997 the Company
also plans to acquire 26 square miles of 3-D seismic data in three additional
3-D projects adjacent to the Elizabeth Rose Fusselman Field and to retain
working interests of 75% to 100% in these projects.

Among Brigham's higher potential West Texas Region projects is the Longhorn
Project, located in the Delaware Basin, in which the Company owns a 25% working
interest. From its 34 square mile 3-D program acquired in the third quarter of
1996, the Company has identified twenty-three 3-D potential drilling locations
and has leased 6,400 gross acres (1,600 net). The project is surrounded by
prolific production from the Devonian and Ellenburger formations at depths of
15,000 feet to 21,000 feet, in fields such as Evetts (approximately 600 Bcf of
natural gas to date from 16 wells) and War Wink South (approximately 295 Bcf of
natural gas to date from eight wells). The Company plans to spud its first deep
test in the second quarter of 1997.

As of February 15, 1997, the Company had acquired 1,552 square miles
(993,280 acres) of 3-D seismic in 73 projects in the West Texas region. As of
December 31, 1996, the Company had completed 164 wells in 255 attempts (a 64%
success rate) and had found cumulative proved reserves of 66.3 Bcf of natural
gas and 22.2 MMBbls of oil, or an aggregate of 199.7 Bcfe, with 13.5%
attributable to the Company's interest. From inception to December 31, 1996, the
Company incurred drilling costs in this province of $.77 per Mcfe. In 1996 the
Company completed 28 wells in 43 attempts in this province, adding 29.8 Bcfe of
proved reserves, with 5.7 Bcfe attributable to the Company's interest, at a
drilling cost of $.45 per Mcfe. The Company has 508 3-D delineated potential
drilling locations in the West Texas region and intends to drill 41 gross (8.2
net) wells in 1997.

33
<PAGE> 35

NATURAL GAS AND OIL RESERVES

The Company's estimated total proved reserves of natural gas and oil as of
December 31, 1994, 1995 and 1996 and the present values attributable to these
reserves as of those dates were as follows:

<TABLE>
<CAPTION>
AS OF DECEMBER 31,
-----------------------------
1994 1995 1996(1)
------- ------- -------
<S> <C> <C> <C>
Estimated proved reserves
Natural gas (MMcf)................................... 3,579 4,257 10,257
Oil (MBbls).......................................... 1,022 1,672 1,940
Natural gas equivalent (MMcfe)....................... 9,710 14,288 21,895
Proved developed reserves as a percentage of proved
reserves............................................. 76% 80% 67%
Present Value of Future Net Revenues(2) (in
thousands)........................................... $10,240 $18,222 $44,506
</TABLE>

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

(1) Net of a sale by the Company in January 1996 of its interest in certain
properties that accounted for 303 MMcf of natural gas and 277 MBbls of oil
(1,962 MMcfe of proved reserves) as of December 31, 1995.

(2) The Present Value of Future Net Revenues attributable to the Company's
reserves was prepared using prices in effect at the end of the respective
periods presented discounted at 10% per annum on a pre-tax basis. The
effects of the Company's hedging activities were immaterial.

The average prices for the Company's reserves were $1.83 per Mcf of natural
gas and $16.19 per Bbl of oil as of December 31, 1994, $1.85 per Mcf of natural
gas and $18.22 per Bbl of oil as of December 31, 1995, and $3.62 per Mcf of
natural gas and $24.67 per Bbl of oil as of December 31, 1996. The reserve
estimates reflected above for 1996 were prepared by Cawley Gillespie, the
Company's petroleum consultants, and are part of a report on the Company's
natural gas and oil properties prepared by Cawley Gillespie, a summary of which
is Appendix A to this Prospectus.

In accordance with applicable requirements of the SEC, estimates of the
Company's proved reserves and future net revenues are made using sales prices
estimated to be in effect as of the date of such reserve estimates and are held
constant throughout the life of the properties (except to the extent a contract
specifically provides for escalation). Estimated quantities of proved reserves
and future net revenues therefrom are affected by natural gas and oil prices,
which have fluctuated widely in recent years. There are numerous uncertainties
inherent in estimating natural gas and oil reserves and their estimated values,
including many factors beyond the control of the Company. The reserve data set
forth in this Prospectus represents only estimates. Reservoir engineering is a
subjective process of estimating underground accumulations of natural gas and
oil that cannot be measured in an exact manner. The accuracy of any reserve
estimate is a function of the quality of available data and of engineering and
geologic interpretation and judgment. As a result, estimates of different
engineers, including those used by the Company, may vary. In addition, estimates
of reserves are subject to revision based upon actual production, results of
future development and exploration activities, prevailing natural gas and oil
prices, operating costs and other factors. The revisions may be material.
Accordingly, reserve estimates are often different from the quantities of
natural gas and oil that are ultimately recovered and are highly dependent upon
the accuracy of the assumptions upon which they are based. The Company's
estimated proved reserves have not been filed with or included in reports to any
federal agency. See "Risk Factors -- Uncertainty of Reserve Information and
Future Net Revenue Estimates."

Estimates with respect to proved reserves that may be developed and
produced in the future are often based upon volumetric calculations and upon
analogy to similar types of reserves rather than actual production history.
Estimates based on these methods are generally less reliable than those based on
actual production history. Subsequent evaluation of the same reserves based upon
production history will result in variations in the estimated reserves that may
be substantial.

34
<PAGE> 36

DRILLING ACTIVITIES

The Company drilled, or participated in the drilling of, the following
number of wells during the periods indicated.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------
1994 1995 1996
------------ ------------ ------------
GROSS NET GROSS NET GROSS NET
----- ---- ----- ---- ----- ----
<S> <C> <C> <C> <C> <C> <C>
Exploratory Wells:
Natural gas................................. 6 1.8 5 1.2 4 .9
Oil......................................... 34 8.3 37 8.1 24 5.4
Non-productive.............................. 26 5.9 32 8.7 24 7.1
-- ---- -- ---- -- ----
Total............................... 66 16.0 74 18.0 52 13.4
== ==== == ==== == ====
Development Wells:
Natural gas................................. -- -- -- -- 9 1.3
Oil......................................... 5 .2 4 .6 6 1.2
Non-Productive.............................. 2 .6 -- -- 1 .1
-- ---- -- ---- -- ----
Total............................... 7 .8 4 .6 16 2.6
== ==== == ==== == ====
</TABLE>

At December 31, 1996, the Company was in the process of drilling 2 gross
(.6 net) wells that are not reflected in the table.

The Company does not own any drilling rigs, and the majority of its
drilling activities are conducted by industry participant operators or
independent contractors under standard drilling contracts.

PRODUCTIVE WELLS AND ACREAGE

Productive Wells

The following table sets forth the Company's ownership interest as of
December 31, 1996 in productive natural gas and oil wells in the areas
indicated.

<TABLE>
<CAPTION>
NATURAL GAS OIL TOTAL
----------- ------------ ------------
PROVINCE GROSS NET GROSS NET GROSS NET
-------- ----- --- ----- ---- ----- ----
<S> <C> <C> <C> <C> <C> <C>
Anadarko Basin................................. 15 3.0 2 .2 17 3.2
Gulf Coast..................................... -- -- -- -- -- --
West Texas Region.............................. 3 1.1 75 17.3 78 18.4
Other.......................................... -- -- 1 .5 1 .5
-- --- -- ---- -- ----
Total................................ 18 4.1 78 18.0 96 22.1
== === == ==== == ====
</TABLE>

Productive wells consist of producing wells and wells capable of
production, including wells waiting on pipeline connection. Wells that are
completed in more than one producing horizon are counted as one well. Of the
gross wells reported above, none had multiple completions.

Acreage

Undeveloped acreage includes 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 gas, regardless of whether or not such acreage contains
proved reserves. A gross acre is an acre in which an interest is owned. A net
acre is deemed to exist when the sum of fractional ownership interests in gross
acres equals one. The number of net acres is the sum of the fractional interests
owned in gross acres expressed as whole numbers and fractions thereof. The

35
<PAGE> 37

following table sets forth the approximate developed and undeveloped acreage in
which the Company held a leasehold mineral or other interest at December 31,
1996:

<TABLE>
<CAPTION>
DEVELOPED UNDEVELOPED TOTAL
-------------- ---------------- ----------------
PROVINCE GROSS NET GROSS NET GROSS NET
-------- ------ ----- ------- ------ ------- ------
<S> <C> <C> <C> <C> <C> <C>
Anadarko Basin.................... 5,646 1,536 45,037 13,669 50,683 15,205
Gulf Coast........................ -- -- 3,738 3,226 3,738 3,226
West Texas Region................. 5,087 1,307 38,106 11,380 43,193 12,687
Other............................. -- -- 161,420 58,513 161,420 58,513
------ ----- ------- ------ ------- ------
Total........................... 10,733 2,843 248,301 86,788 259,034 89,631
====== ===== ======= ====== ======= ======
</TABLE>

In addition, the Company has preseismic lease options to acquire an
additional 107,711 acres, substantially all of which expire within one year.

All the leases for the undeveloped acreage summarized in the preceding
table will expire at the end of their respective primary terms unless the
existing leases are renewed or production has been obtained from the acreage
subject to the lease prior to that date, in which event the lease will remain in
effect until the cessation of production. The following table sets forth the
minimum remaining terms of leases for the gross and net undeveloped acreage:

<TABLE>
<CAPTION>
ACRES EXPIRING
-----------------
GROSS NET
------- ------
<S> <C> <C>
Twelve Months Ending:
December 31, 1997......................................... 59,133 19,695
December 31, 1998......................................... 114,661 41,469
December 31, 1999......................................... 48,928 5,609
Thereafter................................................ 25,579 20,015
------- ------
Total............................................. 248,301 86,788
======= ======
</TABLE>

VOLUMES, PRICES AND PRODUCTION COSTS

The following table sets forth the production volumes, average prices
received and average production costs associated with the Company's sale of
natural gas and oil for the periods indicated.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------
1994 1995 1996
------ ------ ------
<S> <C> <C> <C>
Production:
Natural gas (MMcf)...................................... 165 272 698
Oil (MBbls)............................................. 140 177 227
Natural gas equivalent (MMcfe).......................... 1,002 1,332 2,060
Average sales price:
Natural gas (per Mcf)................................... $ 1.76 $ 1.62 $ 2.30
Oil (per Bbl)........................................... 16.30 17.76 19.98
Average production expenses and taxes (per Mcfe).......... $ .62 $ .69 $ .53
</TABLE>

36
<PAGE> 38

COSTS INCURRED AND CAPITALIZED COSTS

The cost incurred in natural gas and oil acquisition, exploration and
development activities follow (in thousands):

<TABLE>
<CAPTION>
DECEMBER 31,
------------------
1995 1996
------- -------
<S> <C> <C>
Cost incurred for the year:
Exploration............................................... $ 6,893 $10,527
Property acquisition...................................... 1,885 6,195
Development............................................... 713 1,328
Proceeds from participants................................ (1,296) (4,111)
------- -------
$ 8,195 $13,939
======= =======
</TABLE>

Cost incurred represent amounts incurred by the Company for exploration,
property acquisition and development activities. Periodically, the Company will
receive proceeds from participants subsequent to project initiation for an
assignment of an interest in the project. These payments are represented by
proceeds from participants.

EXPLORATION STAFF

Over the last six years the Company has assembled an exploration staff that
includes nine geophysicists, six geologists, one petroleum engineer, three
computer applications specialists, three geophysical/geological/engineering
technicians, four landmen and three lease and division order analysts. Brigham's
nine geophysicists have different but complementary backgrounds, and their
diversity of experience in varied geological and geophysical settings, combined
with various technical specializations (from hardware and systems to software
and seismic data processing), provide the Company with valuable technical
intellectual resources. The Company's team of explorationists have over 200
years of exploration experience and approximately 65 years of 3-D CAEX
workstation experience, most of which was acquired at Brigham and various major
and large independent oil companies. The Company complements and leverages its
exploration staff by seeking out alliances or retainer relationships with
geologists having extensive experience in a particular area of interest.

3-D SEISMIC TECHNOLOGY

The Company's strategy is to use 3-D seismic and other advanced
technologies, including CAEX, to systematically explore and develop domestic
onshore natural gas and oil provinces. In general, 3-D seismic is the process of
acquiring seismic data along multiple lines and grids. The primary advantage of
3-D seismic over 2-D seismic is that it provides information with respect to
multiple horizontal and vertical points within a geologic formation instead of
information on a single vertical line or multiple vertical lines within the
formation. Acquiring larger amounts of data relating to a geologic formation
allows a user to better correlate the data and, in some cases, obtain a greater
understanding and image of the formation. Although it is impossible to predict
with certainty the specific configuration or composition of any underground
geologic formation, the use of 3-D seismic data provides clearer and more
accurate projected images of complex geologic formations, which can assist a
user in evaluating whether to drill for natural gas and oil reserves. If a
decision to drill is made, 3-D seismic data can also help in determining the
optimal location to drill.

CAEX is the process of accumulating and analyzing the various seismic,
production and other data obtained relating to a geographic area. In general,
CAEX involves accumulating various 2-D and 3-D seismic data with respect to a
potential drilling location, correlating that data with historical well control
and production data from similar properties and analyzing the available data
through computer programs and modeling techniques to project the likely geologic
composition of a potential drilling location and potential locations of
undiscovered natural gas and oil reserves. This process relies on a comparison
of actual data with respect to the potential drilling location and historical
data with respect to the density and sonic characteristics

37
<PAGE> 39

of different types of rock formations, hydrocarbons and other subsurface
minerals, resulting in a projected three dimensional image of the subsurface.
This modeling is performed through the use of advanced interactive computer
workstations and various combinations of available computer programs that have
been developed solely for this application.

Brigham has invested extensively in advanced computer hardware and
software, and the Company has both Landmark and Geoquest CAEX workstations. This
workstation flexibility provides the Company the opportunity to interpret a
project on the particular CAEX workstation that it believes is best suited for
defining those particular geologic objectives. Brigham's explorationists can
access a diverse software tool kit including SeisWorks, StratWorks, SeisCube,
SurfCube, ZAP, Zmap+, ARIES, SynTool, Poststack, Continuity Cube, TDQ, AutoPix,
MapView, GeoViz, Voxels, SynView, CSA (Computed Seismic Attributes), Surface
Slice, Hampson -- Russell AVO Analysis and Modeling and ZEH Graphics CGMage
Builder (graphics montage tool).

The Company believes that its use of 3-D seismic technology provides it
with a number of benefits in the exploration, delineation and development
process that are not generally available to those who only use 2-D seismic data
and conventional processing methods. In particular, the Company believes that it
obtains clearer and more accurate projected images of underground formations
through computer modeling, and is therefore better able to identify potential
locations of hydrocarbon accumulations based on the characteristics of the
formations and analogies made with nearby fields and formations where
hydrocarbons have been found. This enhanced data has been used to assist the
Company in eliminating potential drilling locations that might otherwise have
been drilled had the Company relied solely on 2-D seismic data. This data has
also been used to assist the Company in attempting to identify the most
desirable location for the wellbore to increase the prospects of a successful
exploratory or development well and production from the reservoir.

INDUSTRY ALLIANCES

Brigham's volume of activity and its record of performance enable the
Company to enter into vendor alliances thereby accelerating its systematic 3-D
acquisition and generation of potential drilling locations. One vendor has
dedicated to the Company's use in the Anadarko Basin a helicopter equipped 3-D
seismic acquisition crew. Brigham is currently using the crew to shoot more than
500 square miles of 3-D seismic. The arrangement affords the Company access to
3-D seismic data acquisition in a compressed cycle time, providing the Company
with significant operational efficiencies. In addition, the vendor currently
maintains and operates two seismic data processing workstations in Brigham's
offices. Supervised by Brigham's geophysicists, the vendor's employees process
in the Company's offices most of the Company's 3-D data. The associated
improvement in communication and integration, from field data acquisition to
processing, reduces project cycle times, and therefore costs, while improving
the quality of the data for Brigham's subsequent interpretation.

The Company has entered into alliances with Vintage Petroleum, Inc.
("Vintage") and Stephens Production Company ("Stephens") providing for their
participation with Brigham in all projects that the Company conducts within the
500 square mile 3-D seismic program that it is now completing in the Anadarko
Basin. Pursuant to these alliances, Vintage and Stephens bear a disproportionate
share of all pre-seismic and certain seismic costs on all projects in the
province. Net of the interests of Vintage and Stephens, the Company holds a
37.5% interest in the program. The Company believes that this leveraging of its
costs is possible because of the expertise and knowledge that the Company has
developed, enabling the Company to build its revenue and cash flow base at a
time when it has been capital constrained.

In order to participate in wells drilled by the Company between April 1,
1996 and March 31, 1997, each of Gasco Limited Partnership ("Gasco") and Middle
Bay Oil Company, Inc. ("Middle Bay") has agreed to fund 25% of the Company's
drilling costs and 12.5% of its completion cost for each well. In return, the
Company is obligated to assign to each an undivided 12.5% of the Company's
interest in the leasehold allocated to each completed well. As a result, the
Company pays for 50% of costs attributable to its working interest to casing
point, and 75% of its completion costs, for 75% of its original working
interest. The Company is currently in discussions with each of Gasco and Middle
Bay to extend their agreements, although the

38
<PAGE> 40

percentages of costs borne and interest assigned may vary under any renewal or
extension of these agreements. The Company believes that these agreements are
beneficial because they have allowed the Company to leverage its working
interests in its properties by requiring it to bear a smaller proportion of
costs than it has retained in working interests.

NATURAL GAS AND OIL MARKETING AND MAJOR CUSTOMERS

Most of the Company's natural gas and oil production is sold by its
operators under price sensitive or spot market contracts. The revenues generated
by the Company's operations are highly dependent upon the prices of and demand
for natural gas and oil. The price received by the Company for its natural gas
and oil production depends on numerous factors beyond the Company's control,
including seasonality, the condition of the United States economy, foreign
imports, political conditions in other oil-producing and natural gas-producing
countries, the actions of the Organization of Petroleum Exporting Countries and
domestic government regulation, legislation and policies. Decreases in the
prices of natural gas and oil could have an adverse effect on the carrying value
of the Company's proved reserves and the Company's revenues, profitability and
cash flow. Although the Company is not currently experiencing any significant
involuntary curtailment of its oil or natural gas production, market, economic
and regulatory factors may in the future materially affect the Company's ability
to sell its oil or natural gas production. See "Risk Factors -- Volatility of
Natural Gas and Oil Prices" and "Management's Discussion and Analysis of
Financial Condition and Results of Operations." For the year ended December 31,
1996, sales to Cobra Oil and Gas Corporation, Maynard Oil Company and Scurlock
Permian Corporation were approximately 16%, 12% and 10%, respectively, of the
Company's natural gas and oil revenues. Due to the availability of other markets
and pipeline connections, the Company does not believe that the loss of any
single natural gas or oil customer would have a material adverse effect on the
Company's results of operations.

COMPETITION

The oil and gas industry is highly competitive in all of its phases. The
Company encounters competition from other oil and gas companies in all areas of
its operations, including the acquisition of seismic options and lease options
on properties. The Company's competitors include major integrated oil and
natural gas companies and numerous independent oil and natural gas companies,
individuals and drilling and income programs. Many of its competitors are large,
well established companies with substantially larger operating staffs and
greater capital resources than the Company's and which, in many instances, have
been engaged in the exploration and production business for a much longer time
than the Company. Such companies may be able to pay more for seismic and lease
options on natural gas and oil properties and exploratory prospects and to
define, evaluate, bid for and purchase a greater number of properties and
prospects than the Company's financial or human resources permit. The Company's
ability to acquire additional properties and to discover reserves in the future
will be dependent upon its ability to evaluate and select suitable properties
and to consummate transactions in a highly competitive environment. See "Risk
Factors -- Competition" and "Risk Factors -- Substantial Capital Requirements."

OPERATING HAZARDS AND UNINSURED RISKS

Drilling activities are subject to many risks, including the risk that no
commercially productive reservoirs will be encountered. There can be no
assurance that new wells drilled by the Company will be productive or that the
Company will recover all or any portion of its investment. Drilling for natural
gas and oil may involve unprofitable efforts, not only from dry wells, but from
wells that are productive but do not produce sufficient net revenues to return a
profit after drilling, operating and other costs. The cost of drilling,
completing and operating wells is often uncertain. The Company's drilling
operations may be curtailed, delayed or canceled as a result of numerous
factors, many of which are beyond the Company's control, including title
problems, weather conditions, compliance with governmental requirements and
shortages or delays in the delivery of equipment and services. The Company's
future drilling activities may not be successful and, if unsuccessful, such
failure may have a material adverse effect on the Company's future results of
operations and financial condition. See "Risk Factors -- Dependence on
Exploratory Drilling Activities."

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<PAGE> 41

In addition, the Company's use of 3-D seismic technology requires greater
pre-drilling expenditures than traditional drilling strategies. Although the
Company believes that its use of 3-D seismic technology will increase the
probability of success, unsuccessful wells are likely to occur. There can be no
assurance that the Company's drilling program will be successful or that
unsuccessful drilling efforts will not have a material adverse effect on the
Company.

The Company's operations are subject to hazards and risks inherent in
drilling for and producing and transporting natural gas and oil, such as fires,
natural disasters, explosions, encountering formations with abnormal pressures,
blowouts, cratering, pipeline ruptures and spills, any of which can result in
the loss of hydrocarbons, environmental pollution, personal injury claims and
other damage to properties of the Company and others. The Company maintains
insurance against some but not all of the risks described above. In particular,
the insurance maintained by the Company does not cover claims relating to
failure of title to natural gas and oil leases, trespass during 3-D survey
acquisition or surface change attributable to seismic operations, business
interruption or loss of revenues due to well failure. In certain circumstances
in which insurance is available the Company may not purchase it. The occurrence
of an event that is not covered, or not fully covered, by insurance could have a
material adverse effect on the Company's financial condition and results of
operations.

EMPLOYEES

On February 15, 1997, the Company had 33 full-time employees. None is
represented by any labor union. The Company believes its relations with its
employees are good. The Company also relies on several regional broker service
companies to provide field landmen to the Company. One of these companies,
Brigham Land Management, is owned by Vincent L. Brigham, who is the brother of
Ben M. Brigham, the Company's President, Chief Executive Officer and Chairman of
the Board. See "Certain Transactions."

OTHER FACILITIES

Through August 1997, the Company has leased approximately 17,000 square
feet of office space in Dallas, Texas, where its principal offices are located.
When the Company's lease expires, the Company plans to relocate its principal
executive offices to Austin, Texas, where it has leased approximately 29,000
square feet of office space at 6300 Bridgepoint Parkway, Building 2, Suite 500,
Austin, Texas 78730. The Company also leases a 4,500 square foot office at 450
Gears Road, Suite 240, Houston, Texas 77067.

TITLE TO PROPERTIES

The Company believes it has satisfactory title to all of its producing
properties in accordance with standards generally accepted in the oil and gas
industry. The Company's properties are subject to customary royalty interests,
liens incident to operating agreements, liens for current taxes and other
burdens which the Company believes do not materially interfere with the use of
or affect the value of such properties. The Company's Revolving Credit Facility
is secured by substantially all of the Company's natural gas and oil properties.

GOVERNMENTAL REGULATION

The Company's natural gas and oil exploration, production and related
operations are subject to extensive rules and regulations promulgated by federal
and state agencies. Failure to comply with such rules and regulations can result
in substantial penalties. The regulatory burden on the oil and gas industry
increases the Company's cost of doing business and affects its profitability.
Although the Company believes it is in substantial compliance with all
applicable laws and regulations, because those laws and regulations are
frequently amended or reinterpreted, the Company is unable to predict the future
cost or impact of complying with such laws.

The State of Texas and many other states require permits for drilling
operations, drilling bonds and reports concerning operations and impose other
requirements relating to the exploration and production of natural gas and oil.
These states also have statutes or regulations addressing conservation matters,
including

40
<PAGE> 42

provisions for the unitization or pooling of natural gas and oil properties, the
establishment of maximum rates of production from wells and the regulation of
spacing, plugging and abandonment of such wells.

The Federal Energy Regulatory Commission ("FERC") regulates interstate
natural gas transportation rates and service conditions, which affect the
marketing of gas produced by the Company, as well as the revenues received by
the Company for sales of such production. Since the mid-1980s, FERC has issued a
series of orders, culminating in Order Nos. 636, 636-A and 636-B ("Order 636"),
that have significantly altered the marketing and transportation of gas. Order
636 mandates a fundamental restructuring of interstate pipeline sales and
transportation service, including the unbundling by interstate pipelines of the
sale, transportation, storage and other components of the city-gate sales
services such pipelines previously performed. One of FERC's purposes in issuing
the order was to increase competition within all phases of the natural gas
industry. Numerous parties have filed petitions for review of Order 636, as well
as orders in individual pipeline restructuring proceedings. In July 1996, Order
636 was generally upheld on appeal, and the portions remanded for further action
do not appear to materially affect the Company. Because Order 636 may be
modified as a result of the appeals, it is difficult to predict the ultimate
impact of the orders on the Company and its gas marketing efforts. Generally,
Order 636 has eliminated or substantially reduced the interstate pipelines'
traditional role as wholesalers of natural gas and has substantially increased
competition and volatility in natural gas markets.

The price the Company receives from the sale of natural gas liquids and oil
is affected by the cost of transporting products to markets. Effective January
1, 1995, FERC implemented regulations establishing an indexing system for
transportation rates for oil pipelines, which, generally, would index such rates
to inflation, subject to certain conditions and limitations. The Company is not
able to predict with certainty the effect, if any, of these regulations on its
operations. However, the regulations may increase transportation costs or reduce
well head prices for natural gas liquids and oil. See "Risk
Factors -- Compliance with Government Regulations."

ENVIRONMENTAL MATTERS

The Company's operations and properties are subject to extensive and
changing federal, state and local laws and regulations relating to environmental
protection, including the generation, storage, handling, emission,
transportation and discharge of materials into the environment, and relating to
safety and health. The recent trend in environmental legislation and regulation
generally is toward stricter standards, and this trend will likely continue.
These laws and regulations may require the acquisition of a permit or other
authorization before construction or drilling commences and for certain other
activities; limit or prohibit construction, drilling and other activities on
certain lands lying within wilderness and other protected areas; and impose
substantial liabilities for pollution resulting from the Company's operations.
The permits required for various of the Company's operations are subject to
revocation, modification and renewal by issuing authorities. Governmental
authorities have the power to enforce compliance with their regulations, and
violations are subject to fines or injunction, or both. In the opinion of
management, the Company is in substantial compliance with current applicable
environmental laws and regulations, and the Company has no material commitments
for capital expenditures to comply with existing environmental requirements.
Nevertheless, changes in existing environmental laws and regulations or in
interpretations thereof could have a significant impact on the Company, as well
as the oil and gas industry in general. The Comprehensive Environmental
Response, Compensation and Liability Act and comparable state statutes impose
strict, joint and several liability on owners and operators of sites and on
persons who disposed of or arranged for the disposal of "hazardous substances"
found at such sites. It is not uncommon for the neighboring land owners and
other third parties to file claims for personal injury and property damage
allegedly caused by the hazardous substances released into the environment. The
Resource Conservation and Recovery Act and comparable state statutes govern the
disposal of "solid waste" and "hazardous waste" and authorize imposition of
substantial fines and penalties for noncompliance. Although CERCLA currently
excludes petroleum from its definition of "hazardous substance," state laws
affecting the Company's operations impose clean-up liability relating to
petroleum and petroleum related products. In addition, although RCRA classifies

41
<PAGE> 43

certain oil field wastes as "non-hazardous," such exploration and production
wastes could be reclassified as hazardous wastes thereby making such wastes
subject to more stringent handling and disposal requirements.

Federal regulations require certain owners or operators of facilities that
store or otherwise handle oil, such as the Company, to prepare and implement
spill prevention, control countermeasure and response plans relating to the
possible discharge of oil into surface waters. The Oil Pollution Act of 1990, as
amended ("OPA"), contains numerous requirements relating to the prevention of
and response to oil spills into waters of the United States. For onshore
facilities that may affect waters of the United States, the OPA requires an
operator to demonstrate $10 million in financial responsibility, and for
offshore facilities the financial responsibility requirement is at least $35
million. Regulations are currently being developed under federal and state laws
concerning oil pollution prevention and other matters that may impose additional
regulatory burdens on the Company. In addition, the Clean Water Act and
analogous state laws require permits to be obtained to authorize discharge into
surface waters or to construct facilities in wetland areas. With respect to
certain of its operations, the Company is required to maintain such permits or
meet general permit requirements. The EPA recently adopted regulations
concerning discharges of storm water runoff. This program requires covered
facilities to obtain individual permits, participate in a group or seek coverage
under an EPA general permit. The Company believes that it will be able to
obtain, or be included under, such permits, where necessary, and to make minor
modifications to existing facilities and operations that would not have a
material effect on the Company.

The Company has acquired leasehold interests in numerous properties that
for many years have produced natural gas and oil. Although the previous owners
of these interests have used operating and disposal practices that were standard
in the industry at the time, hydrocarbons or other wastes may have been disposed
of or released on or under the properties. In addition, some of the Company's
properties are operated by third parties over whom the Company has no control.
Notwithstanding the Company's lack of control over properties operated by
others, the failure of the operator to comply with applicable environmental
regulations may, in certain circumstances, adversely impact the Company. See
"Risk Factors -- Compliance with Environmental Regulations" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Other Matters."

LEGAL PROCEEDINGS

The Company is not a party to any material legal proceedings.

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<PAGE> 44

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth certain information regarding the executive
officers and directors of the Company:

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Ben M. Brigham............................ President, Chief Executive Officer and
37 Chairman of the Board
Anne L. Brigham........................... Executive Vice President, Secretary and
35 Director
Jon L. Glass.............................. 41 Vice President -- Exploration and Director
Craig M. Fleming.......................... 39 Chief Financial Officer
David T. Brigham.......................... 36 Vice President -- Legal
A. Lance Langford......................... 34 Vice President -- Operations
Harold D. Carter.......................... 58 Consultant and Director
Alexis M. Cranberg........................ 41 Director
Gary J. Milavec........................... 35 Director
Stephen P. Reynolds....................... 45 Director
</TABLE>

Set forth below is a description of the backgrounds of the executive
officers and directors of the Company.

Ben M. "Bud" Brigham has served as President, Chief Executive Officer and
Chairman of the Board of the Company since founding the Company in 1990. From
1984 to 1990, Mr. Brigham served as an exploration geophysicist with Rosewood
Resources, an independent oil and gas exploration and production company. Mr.
Brigham began his career in Houston as a seismic data processing geophysicist
for Western Geophysical, a provider of 3-D seismic services, after earning his
B.S. in Geophysics from the University of Texas.

Anne L. Brigham has served as Executive Vice President, Secretary and a
Director of the Company since its inception in 1990. Before joining the Company
full-time in 1991, Ms. Brigham practiced law in the oil and gas and real estate
sections of Thompson & Knight, P.C. Ms. Brigham worked as a geologist for Hunt
Petroleum Corporation, an independent oil and gas exploration and production
company, for over two years before attending law school. Ms. Brigham holds a
B.S. in Geology from the University of Texas and a J.D. from Southern Methodist
University.

Jon L. Glass joined the Company in 1993 and has served as Vice
President -- Exploration and a Director of the Company since 1995. From 1984 to
1992, Mr. Glass served in various capacities with Santa Fe Minerals, an oil and
gas exploration company, in a variety of staff and managerial positions mainly
focused on Santa Fe Minerals' exploration activities in the midcontinent and
Gulf of Mexico (onshore and offshore). During this time Mr. Glass also assisted
in the development of exploration and acquisition opportunities for Santa Fe
Minerals in Canada and South America. Mr. Glass' early geological experience
includes three years with Mid-America Pipeline Company and two years with Texaco
USA, serving mainly as a midcontinent exploration geologist. Mr. Glass holds a
B.S. and an M.S. in Geology from Oklahoma State University and an M.B.A. from
the University of Tulsa.

Craig M. Fleming has served as the Chief Financial Officer of the Company
since 1993. From 1990 to 1993, Mr. Fleming served as Controller of Odyssey
Petroleum Co., Ltd., an independent energy company. From 1988 to 1990, Mr.
Fleming served as Controller and Treasurer for Harken Exploration Company, an
independent energy company. Mr. Fleming began his career with Arthur Anderson &
Co. in the Oil and Gas Audit Division and is a Certified Public Accountant. Mr.
Fleming holds a B.B.A. in Accounting from Texas A&M University.

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<PAGE> 45

David T. Brigham joined the Company in 1992 and has served as Vice
President -- Legal of the Company since 1994. From 1987 to 1992, Mr. Brigham was
an oil and gas attorney with Worsham, Forsythe, Sampels & Wooldridge. Before
attending law school, Mr. Brigham was a landman for Wagner & Brown Oil and Gas
Producers, an independent oil and gas exploration and production company. Mr.
Brigham holds a B.B.A. in Petroleum Land Management and a J.D. from Texas Tech
University.

A. Lance Langford joined the Company as Manager of Operations in 1995 and
has served as Vice President Operations since January 1997. From 1987 to 1995,
Mr. Langford served in various engineering capacities with Meridian Oil Inc.,
handling a variety of reservoir, production and drilling responsibilities. Mr.
Langford holds a B.S. in Petroleum Engineering from Texas Tech University.

Harold D. Carter has served as a Director of and consultant to the Company
since 1992. Mr. Carter has more than 30 years experience in the oil and gas
industry and has been an independent consultant since 1990. Prior to consulting,
Mr. Carter served as Executive Vice President of Pacific Enterprises Oil Company
(USA). Before that, Mr. Carter was associated for 20 years with Sabine
Corporation, ultimately serving as President and Chief Operating Officer from
1986 to 1989. Mr. Carter consults Endowment Advisors, Inc. with respect to its
EEP Partnerships and Associated Energy Managers, Inc. with respect to its Energy
Income Fund, L.P. and is a director of Abraxas Petroleum Corporation. Mr. Carter
has a B.B.A. in Petroleum Land Management from the University of Texas and has
completed the Program for Management Development at the Harvard University
Business School.

Alexis M. Cranberg has served as a Director of the Company since 1992. Mr.
Cranberg is President of Aspect Management Corporation, an oil and gas
exploration and investment company. In addition, Mr. Cranberg is a Director for
Westport Oil and Gas Company, Inc. and a past Director of General Atlantic
Resources, Inc. and United Meridian Corporation. He holds a B.S. in Petroleum
Engineering from the University of Texas and an M.B.A. from Stanford University.

Gary J. Milavec has served as a Director of the Company since 1995. Mr.
Milavec is a Senior Vice President of RIMCO, a full service investment
management firm specializing in the energy industry. Prior to joining RIMCO in
1990, Mr. Milavec spent two years in the corporate finance department of
Rauscher Pierce Refsnes, Inc. and three years as a geological engineer with
Shell Western E&P, Inc. He also serves as a director of Universal Seismic
Associates, Inc. and Texoil, Inc. Mr. Milavec holds B.S. in Geology from the
University of Rochester, an M.S. in Geology from the University of Oklahoma and
an M.B.A. from the University of Houston.

Stephen P. Reynolds has served as a Director of the Company since 1996. Mr.
Reynolds is a managing member of General Atlantic Partners, LLC ("GAP LLC") and
has been with GAP LLC or its predecessor entities since April 1980. Mr. Reynolds
is also President of GAP III Investors, Inc., the general partner of General
Atlantic Partners III, L.P., and is a general partner and limited partner of
GAP-Brigham Partners, L.P. Mr. Reynolds is on the board of directors of Solo
Serve Corporation, a publicly traded off-price soft goods retail company, and
Computer Learning Centers, Inc., a publicly traded company providing technology
related training. Mr. Reynolds holds a B.A. in Economics from Amherst College
and a Masters degree in Accounting from New York University.

All directors are elected to serve until the next annual meeting of
stockholders and until their successors are elected and qualified. Executive
officers are generally elected annually by the Board of Directors to serve,
subject to the discretion of the Board of Directors, until their successors are
elected or appointed.

There is no family relationship between any of the directors or between any
director and any executive officer of the Company except that Ben M. Brigham and
Anne L. Brigham are married and David T. Brigham is the brother of Ben M.
Brigham. For information regarding certain business relationships between the
Company and certain of its directors, see "Certain Transactions."

COMMITTEES OF THE BOARD

Upon completion of the Offering, the Company will establish two standing
committees of the Board of Directors: an Audit Committee and a Compensation
Committee. Messrs. Carter, Cranberg and Milavec are

44
<PAGE> 46

expected to be members of the Audit Committee and Compensation Committee
following completion of the Offering. The Audit Committee will review the
functions of the Company's management and independent accountants pertaining to
the Company's financial statements and perform such other related duties and
functions as are deemed appropriate by the Audit Committee or the Board of
Directors. The Compensation Committee will recommend to the Board of Directors
the base salaries, bonuses and other incentive compensation for the Company's
officers. The Board of Directors has designated the Compensation Committee as
the administrator of the Company's 1997 Incentive Plan. See
"Management -- Employee Benefit Plans -- 1997 Incentive Plan."

DIRECTOR COMPENSATION

Fees and Expenses; Other Arrangements. Directors who are also employees of
the Company are not separately compensated for serving on the Board of
Directors. Directors who are not employees of the Company receive $5,000 per
year and $500 per meeting for their services as directors. In addition, the
Company reimburses Directors for the expenses incurred in connection with
attending meetings of the Board of Directors and its committees.

Pursuant to a consulting agreement with Harold D. Carter that expires May
1, 1997, the Company pays Mr. Carter $7,200 per month to spend approximately 50%
of his working time performing such consulting and advisory services regarding
the operations of the Company as the Company requests, including service on the
Management Committee of the Company's predecessor partnership.

Alexis M. Cranberg and Stephen P. Reynolds served on the management
committee of the Company's predecessor partnership pursuant to the terms of an
agreement with General Atlantic, and Gary J. Milavec served on the committee
pursuant to the terms of an agreement with RIMCO. The Company is not obligated
to nominate any of the three to serve as a Director of the Company in the
future.

Director Stock Options. The Company's stockholders have approved the 1997
Director Stock Option Plan, pursuant to which each newly elected nonemployee
director shall be granted an option to purchase 1,000 shares of Common Stock and
each nonemployee director will receive an option to purchase 500 shares of
Common Stock on December 31 of each year. The options under the plan are granted
at fair market value on the grant date and become exercisable, subject to
certain conditions, in five equal annual installments on the first five
anniversaries of the grant date. The options terminate ten years from the grant
date, unless terminated sooner.

LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS

In accordance with Section 102(b)(7) of the Delaware General Corporation
Law ("DGCL"), the Company's Certificate of Incorporation includes a provision
that, to the fullest extent permitted by law, eliminates the personal liability
of members of its Board of Directors to the Company or its stockholders for
monetary damages for breach of fiduciary duty as a director. Such provision does
not eliminate or limit the liability of a director (1) for any breach of a
director's duty of loyalty to the Company or its stockholders, (2) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of a law, (3) for paying an unlawful dividend or approving an illegal
stock repurchase (as provided in Section 174 of the DGCL) or (4) for any
transaction from which the director derived an improper personal benefit.

The Company has entered into indemnity agreements with each of its
executive officers and directors that provide for indemnification in certain
instances against liability and expenses incurred in connection with proceedings
brought by or in the right of the Company or by third parties by reason of a
person serving as an officer or director of the Company.

The Company believes that these provisions and agreements will assist the
Company in attracting and retaining qualified individuals to serve as directors
and officers.

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<PAGE> 47

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of the members of the Compensation Committee is or has been an
employee of the Company. Mr. Carter is and has been since 1992 a consultant to
the Company. No executive officer of the Company serves as a member of the board
of directors or compensation committee of any entity that has one or more
executive officers serving as a member of the Company's Board of Directors or
Compensation Committee. All of the Company's directors, or their affiliates,
have acquired capital stock of the Company. See "Certain Transactions."

EXECUTIVE COMPENSATION

The following table sets forth all compensation paid for the last fiscal
year to the Company's Chief Executive Officer and each of the Company's other
executive officers whose annual salary exceeded $100,000 for the fiscal year
ended December 31, 1996. The table does not include perquisites and other
personal benefits because the aggregate amount of such compensation does not
exceed the lesser of (i) $50,000 or (ii) 10% of individual combined salary and
bonus for the named executive officers in each year.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------------------
ANNUAL COMPENSATION RESTRICTED SHARES
NAME AND -------------------------- STOCK UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS(1) AWARDS OPTIONS(2) COMPENSATION(3)
------------------ ---- -------- -------- ---------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Ben M. Brigham............... 1996 $143,996 $15,000 -- -- $4,717
President, Chief Executive
Officer and Chairman of
the Board
Jon L. Glass................. 1996 108,396 3,223 -- -- --
Vice
President -- Exploration
Craig M. Fleming............. 1996 101,532 8,063 -- -- --
Chief Financial Officer
David T. Brigham............. 1996 93,351 10,505 -- -- --
Vice President -- Legal
</TABLE>

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

(1) Includes, for Jon L. Glass, Craig M. Fleming and David T. Brigham, bonuses
earned under the Company's Incentive Bonus Plan of $3,223, $4,202 and
$5,496, respectively. See "Employment Benefit Plans -- ncentive Bonus Plan."

(2) Does not include options to purchase Common Stock granted in February 1997
at an exercise price of $ in the amount of 208,333 shares for Jon L.
Glass, 69,444 shares for Craig M. Fleming and 69,444 shares for David T.
Brigham.

(3) Consists of premiums paid by the Company under life and disability insurance
plans of $1,404 and $3,413, respectively.

Employment Agreements

The Company employs Ben M. Brigham under an Employment Agreement (the
"Employment Agreement") as President and Chief Executive Officer of the Company
for a five year term that began in February 1997. The Employment Agreement
contains rollover provisions so that at all times the term of the Employment
Agreement shall be not less than three years. The agreement provides for an
annual salary of $275,000, which the Board of Directors may further increase
from time to time. Mr. Brigham is also entitled to an annual cash bonus, not to
exceed 75% of his then current salary, determined based on criteria established
by the Board of Directors. Under the Employment Agreement, Mr. Brigham is
entitled to participate in any employee benefit programs that the Company
provides to its executive officers. The only employee benefit programs that the
Company offers to its officers and employees are group insurance coverage and
participation

46
<PAGE> 48

in the Company's 401(k) Retirement Plan, the 1997 Incentive Plan and the
Incentive Bonus Plan. If Mr. Brigham terminates his employment for good reason,
which includes a material reduction of Mr. Brigham's position without cause or
his written consent, breach of a material provision of the Employment Agreement
or improper notice of termination, or if the Company terminates Mr. Brigham
without cause, the Company must pay Mr. Brigham a sum equal to the amount of his
annual base salary that he would have received during the remainder of his
employment term plus the average of his annual bonuses received in the preceding
two years times the number of years in the remainder of his employment term. Mr.
Brigham's agreement also contains a three-year non-compete and confidentiality
clause with standard terms.

Each of the other executive officers of the Company is a party to a
confidentiality and noncompete agreement contained in agreements relating to the
officers' restricted stock. See "Management -- Employee Benefit
Plans -- Employees' Restricted Stock."

EMPLOYEE BENEFIT PLANS

Employees' Restricted Stock. In February 1997, the Company, in connection
with the Exchange, issued 66,964 shares, 44,643 shares and 44,643 shares of
restricted stock to Jon L. Glass, Craig M. Fleming and David T. Brigham,
respectively, in exchange for restricted limited partnership interests issued to
them in 1994. Each agreement relating to the restricted stock contains
confidentiality, noncompete and vesting provisions. The shares awarded Messrs.
Brigham and Fleming vest over a three-year period -- 30% in each of July 1997
and 1998 and 40% in July 1999. 16.67% of Mr. Glass's shares have already vested,
28.33% vest in each of July 1997 and 1998, and 26.67% vest in July 1999.

1997 Incentive Plan. The Board of Directors and the stockholders of the
Company approved the adoption of the Company's 1997 Incentive Plan (the "1997
Incentive Plan") as of February 27, 1997. The Compensation Committee selects
participants in the 1997 Incentive Plan are selected by the Compensation
Committee from among those key employees and others who hold positions of
responsibility with the Company and whose performance may have a significant
effect on the success of the Company. An aggregate of 1,589,169 shares of Common
Stock have been authorized and reserved for issuance pursuant to the 1997
Incentive Plan.

Subject to the provisions of the 1997 Incentive Plan, the Compensation
Committee is authorized to determine the type or types of awards made to each
participant and the terms, conditions and limitations applicable to each award.
In addition, the Compensation Committee has the exclusive power to interpret the
1997 Incentive Plan and to adopt rules and regulations that it may deem
necessary or appropriate, in keeping with the objectives of the 1997 Incentive
Plan.

Pursuant to the 1997 Incentive Plan, participants will be eligible to
receive awards consisting of stock options, stock appreciation rights, stock,
restricted stock, cash or any combination of the foregoing. Stock options may be
either incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended, or nonqualified stock options.

In February 1997, options have been granted to purchase a total of 644,097
shares of Common Stock at an exercise price per share of $ . These
options vest over six years.

Incentive Bonus Plan. In connection with the Exchange, the Company has
adopted the Incentive Bonus Plan (the "Incentive Bonus Plan") previously
established by the Company's predecessor partnership. The Incentive Bonus Plan
is designed to pay cash compensation and bonuses to eligible employees of the
Company. Under the Incentive Bonus Plan, the Company maintains an incentive
account for each calendar year (each an "Incentive Account") and a discretionary
bonus account (the "Discretionary Bonus Account"). Prior to the beginning of
each calendar year the President of the Company designates the employees of the
Company who are eligible to participate in the Incentive Account being
established for such year, and each such employee's percentage of interest (an
"Account Percentage") in such Incentive Account. Subject to certain adjustments
provided under the Incentive Bonus Plan, each Incentive Account is credited with
an amount equal to one-half of the net revenue received by the Company which is
equivalent to a one percent interest in the Company's net revenue interest in
the oil and gas produced from each Company well drilled or

47
<PAGE> 49

reentered after April 30, 1992, and the Discretionary Bonus Account is credited
with an amount equal to the amount credited to each Incentive Account. The
President has discretion to allocate a greater interest to the accounts. Within
thirty days after each March 31 and September 30, an employee who has been
designated to have an Account Percentage in the Incentive Account established
for a particular year receives cash compensation equal to his or her Account
Percentage in such Incentive Account multiplied by the amount credited to that
Incentive Account for the six-month period then ended. In addition, the
President of the Company has the discretion to award cash bonuses to any Company
employee from the amounts credited to the Discretionary Bonus Account. The
participation of an employee under the Incentive Bonus Plan terminates when he
or she ceases to be an employee of the Company for any reason. The President of
the Company may amend or terminate the Incentive Bonus Plan at any time.

CERTAIN TRANSACTIONS

In connection with the land work necessary prior to and during 3-D seismic
acquisitions, the Company engages Brigham Land Management ("BLM"), an
independent company owned and managed by Vincent M. Brigham, a brother of Ben M.
Brigham, who is the Company's President, Chief Executive Officer and Chairman of
the Board. BLM specializes in conducting the field land work necessary prior to
and during 3-D seismic acquisitions. BLM's regional expertise is in the Anadarko
Basin and the Texas Panhandle, and to a lesser extent, West Texas. BLM performs
these services for the Company using BLM's employees and independent
contractors. BLM performs approximately one-third of the Company's work in the
Anadarko Basin. In 1994, 1995 and 1996, the Company paid BLM $310,000, $382,000
and $596,000, respectively. Other participants in the Company's 3-D seismic
projects reimbursed the Company for most of these amounts. Based on its
experience with other firms in the area, the Company believes that BLM's charges
are at or below those of other firms.

In 1994, the Company, through its subsidiary Quest Resources, L.L.C.,
formed Venture Acquisitions, L.P. ("Venture") with affiliates of RIMCO, a holder
of in excess of 5% of the Common Stock, to provide the Company with the capital
to acquire interests in potential drilling locations, producing properties and
3-D seismic projects. The RIMCO affiliates have contributed $5.2 million to
Venture, and the Company has contributed $275,000. Until the first payout under
the Venture limited partnership agreement, the Company's share of all capital
costs is 5%, and the Company's share of revenues and related production expenses
and costs is 10%. Between the first and second payout levels, the Company's
share of capital costs and revenues and related production expenses and costs is
25% and thereafter increases to 50%. Venture acquired an interest in (i) a 3-D
project, including a 3-D delineated producing well, for approximately $525,000
in 1994, (ii) a 3-D project for approximately $75,000 in 1995 and (iii) two 3-D
delineated potential drilling locations and 3-D seismic data for approximately
$83,000 in 1996. The Company billed Venture approximately $3,200 in 1994,
$14,000 in 1995 and $16,500 in 1996 for its proportionate share of exploration
and overhead costs. Because RIMCO was not an affiliate of the Company when the
Venture partnership was formed, the Company believes that the terms of the
Venture partnership are no less favorable than could be obtained from an
unaffiliated third party. Gary J. Milavec, a director of the Company, is
employed by RIMCO.

In November 1994, the Company, certain RIMCO affiliates and other unrelated
industry participants entered into a geophysical exploration agreement creating
an area of mutual interest in its Esperson Dome Project in Liberty and Harris
Counties, Texas. The Company financed its participation in this project by
assigning its interest, and obligation to bear costs, to Vaquero Gas Company,
Inc. ("Vaquero"), a RIMCO affiliate, subject to a 5% net profits overriding
royalty interest and the right to receive up to 50% of Vaquero's interest based
on performance. The Company also retained responsibility for managing the 3-D
seismic data acquisition and interpretation of the data after it had been
acquired. During 1995 and 1996, the Company received approximately $25,000 and
$123,000, respectively, from the RIMCO affiliates, including Vaquero, for
workstation time and geoscientists' time in interpreting the 3-D seismic data
that were acquired. Because RIMCO was not an affiliate of the Company when the
project was initiated and the interest to Vaquero was transferred, it believes
that the terms of the arrangement are no less favorable than could be obtained
from an unaffiliated third party.

48
<PAGE> 50

In January 1997, the Company, RIMCO and Tigre Energy Corporation ("Tigre")
entered into an agreement under which the Company has been initially assigned an
undivided 25% interest (subject to a proportionately reduced 3% overriding
royalty interest) in a project located in Vermillion Parish, Louisiana in return
for paying certain costs of acquiring 3-D seismic and land within the project
area. The Company also has the option to acquire an additional 12.5% working
interest from RIMCO and an additional 37.5% working interest from Tigre in parts
of the project. The Company believes that the arrangements with RIMCO affiliates
relating to Tigre Point are on terms no less favorable than could be obtained
from an unaffiliated third party, because RIMCO and Tigre, an unaffiliated third
party, are participants in the project on substantially similar terms.

The Company and Universal Seismic Associates, Inc. ("USA"), a public
company in which RIMCO affiliates beneficially own approximately 18% of the
outstanding common stock, have entered into a geophysical exploration agreement
covering an area of mutual interest on the Gulf Coast. Under the terms of the
agreement, USA will conduct a 3-D seismic program established by the Company and
USA and process the data acquired under the program at cost, and the Company
will interpret the resulting seismic data for the benefit of the Company and USA
at no charge to USA. Subject to a party electing not to participate in an
acquired interest, the Company and USA will each own an undivided 50% interest
in all land interests acquired within the area of mutual interest. Through
December 31, 1996, the Company had not increased any costs under those
arrangements. Based on its experience in acquiring 3-D seismic data, the Company
believes that it will acquire 3-D seismic data under this agreement on terms,
and that the arrangement is on terms, no less favorable than could be obtained
from an unaffiliated third party. The Company is currently negotiating two other
agreements with USA and its affiliates regarding two separate 3-D seismic
acquisition projects. One of these projects would be structured similarly to the
current project and the other project involves the use of another company's
speculative seismic data covering a project within which the Company would own
70% and USA would own 30% of the rights in the project and each party would pay
their proportion, share of all costs related to the project (including
reimbursements for certain Company employee time).

In 1994 the Company issued to RIMCO 10% Notes in a principal amount of $5.0
million. In 1995 the Company issued RIMCO additional 10% Notes in a principal
amount of $2.6 million, and in the same year, issued RIMCO 5% Notes in a
principal amount of $16.0 million, $10.5 million of which was used to repay all
the outstanding 10% Notes. The 5% Notes have been exchanged for 1,754,464 shares
of Common Stock in the Exchange. In 1994, 1995 and 1996, the Company paid RIMCO
$644,726, $734,096 and $891,429, respectively, in interest and additional
payments on both the 5% Notes and the 10% Notes. As part of the Exchange, the
Company has agreed to pay to RIMCO an amount equal to the interest the Company
would have been currently paid on the 5% Notes through the earlier to occur the
date of the closing of the Offering or September 30, 1997.

In 1995 and 1996, the Company paid $35,000 and $110,000 to Aspect and
affiliates of Alexis Cranberg, a director of the Company, to acquire interests
in a project in Grady County, Oklahoma and a project in Hardeman and Wilbarger
Counties, Texas and Jackson County, Oklahoma. Based on its experience in the
industry, the Company believes that these transactions are on terms no less
favorable than could be obtained from an unaffiliated third party. The Company
billed Aspect and other affiliates of Alexis Cranberg $201,000 in 1994, $13,000
in 1995 and $68,000 in 1996 for its proportionate share of exploration costs
related to the projects.

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<PAGE> 51

together, the RIMCO entities and the General Atlantic entities each may
separately require the Company to register securities, on one occasion, if the
shares to be registered have an estimated aggregate offering price to the public
of at least $3.0 million. One additional registration is allowed if any
registrable securities requested to be included in a previous registration
statement were not disposed of in accordance with that previous registration.
The Registration Rights Agreement also provides "piggyback" registration rights
after the Offering for all registrations of registrable securities for the
Company or another security holder. In an underwritten offering, however, the
Company may exclude all or a portion of the securities being registered pursuant
to "piggyback" registration rights if the managing underwriter determines that
including those securities would raise a substantial doubt about whether the
proposed offering could be consummated. The Registration Rights Agreement
contains customary indemnity by the Company in favor of persons selling
securities in a registration governed by the Registration Rights Agreement, and
by those persons in favor of the Company, relating to the information included
in or omitted from the Registration Statement.

PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of February 27, 1997, by (i) each
person the Company knows to be the beneficial owner of 5% or more of the
outstanding shares of Common Stock, (ii) each named executive officer, (iii)
each director of the Company and (iv) all executive officers and directors of
the Company as a group. Except as indicated in the footnotes to this table and
pursuant to applicable community property laws, the Company believes that each
stockholder named in this table has sole investment and voting power with
respect to the shares set forth opposite such stockholder's name.

<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES BENEFICIALLY
OWNED PRIOR TO THE SHARES BEING OWNED AFTER THE
OFFERING(1) OFFERED OFFERING(1)
------------------- ------------ -------------------
BENEFICIAL OWNER NUMBER PERCENT NUMBER PERCENT
---------------- --------- ------- --------- -------
<S> <C> <C> <C> <C> <C>
Ben M. Brigham(2)..................... 3,859,821 43.23%
5949 Sherry Lane, Suite 1616
Dallas, Texas 75225
Anne L. Brigham(2).................... 3,859,821 43.23%
5949 Sherry Lane, Suite 1616
Dallas, Texas 75225
General Atlantic Partners,
L.L.C.(3)........................... 2,807,143 31.44%
Three Pickwick Plaza
Greenwich, Connecticut 06830
Resource Investors Management
Company(4).......................... 1,754,464 19.65% --
600 Travis Street, Suite 6875
Houston, Texas 77002
Craig M. Fleming(5)................... 44,643 * -- 44,643
Jon L. Glass(6)....................... 66,964 * -- 66,964
David T. Brigham(7)................... 44,643 * -- 44,643
Harold D. Carter...................... 350,893 3.93% -- 350,893
Gary J. Milavec(4).................... 1,754,464 19.65% -- 1,754,464
Alexis M. Cranberg.................... -- -- -- --
Stephen P. Reynolds(3)................ 2,807,143 31.44%
All directors and executive officers
as a group (10 persons)(5)(6)(7).... 4,366,964 48.91%
</TABLE>

50
<PAGE> 52

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

* Represents less than 1%.

(1) Shares beneficially owned and percentage of ownership are based on 8,928,571
shares of Common Stock outstanding before the Offering and shares of
Common Stock outstanding after the closing. Beneficial ownership is
determined in accordance with the rules of the SEC and generally includes
voting or disposition power with respect to securities.

(2) Includes 1,929,911 shares owned by Ben M. Brigham and 1,929,910 shares owned
by Anne L. Brigham, who are husband and wife. If the Underwriters'
over-allotment option is exercised in full, the number and percentage of
outstanding shares beneficially owned by Anne L. Brigham and Ben M. Brigham
will be and %, respectively.

(3) Includes 2,679,418 shares held by General Atlantic Partners III, L.P. ("GAP
III"); and 127,725 shares held by GAP-Brigham Partners, L.P. ("GAP-Brigham")
(collectively, "the General Atlantic Entities"). If the Underwriters'
over-allotment option is exercised in full, the number and percentage of
outstanding shares owned by the General Atlantic Entities will be and
%, respectively. The general partner of GAP III is GAP III Investors,
Inc., a Delaware corporation. The general partner of GAP-Brigham is Stephen
P. Reynolds. Stephen P. Reynolds, a director of the Company, is the general
partner and a limited partner in GAP-Brigham and is President of GAP III
Investors, Inc. Mr. Reynolds disclaims beneficial ownership of shares owned
by GAP III and GAP-Brigham except to the extent of his pecuniary interest
therein.

(4) Includes 612,308 shares held by RIMCO Partners, L.P. II, 307,031 shares held
by RIMCO Partners, L.P. III and 835,125 shares held by RIMCO Partners, L.P.
IV (collectively, the "RIMCO Partnerships"). RIMCO is the general partner of
each of the RIMCO Partnerships. Gary J. Milavec, a Director of the Company,
is a Senior Vice President of RIMCO. Mr. Milavec disclaims beneficial
ownership of shares beneficially owned by RIMCO and the RIMCO Partnerships.

(5) Includes 44,643 shares of restricted stock, which vest as follows: 30% in
July 1997, 30% in July 1998 and 40% in July 1999.

(6) Includes 66,964 shares of restricted stock, which vest as follows: 28.33% in
July 1997, 28.33% in July 1998 and 26.67% in July 1999.

(7) Includes 44,643 shares of restricted stock, which vest as follows: 30% in
July 1997, 30% in July 1998 and 40% in July 1999.

DESCRIPTION OF CAPITAL STOCK

The authorized capital stock of the Company consists of 30 million shares
of Common Stock, par value $.01 per share, and 10 million shares of preferred
stock, par value $.01 per share ("Preferred Stock"). shares of
Common Stock will be issued and outstanding upon completion of the Offering
( shares if the Underwriters exercise their over-allotment option
in full). As of February 27, 1997, the Company had outstanding 8,928,571 shares
of Common Stock held of record by 11 stockholders and stock options for an
aggregate of 644,097 shares.

COMMON STOCK

The holders of Common Stock are entitled to one vote for each share held of
record on all matters submitted to the stockholders. The Certificate of
Incorporation of the Company does not allow the stockholders to take action by
less than unanimous consent. Each share of Common Stock is entitled to
participate equally in dividends, if, as and when declared by the Company's
Board of Directors, and in the distribution of assets in the event of
liquidation, subject in all cases to any prior rights of outstanding shares of
Preferred Stock. The Company has never paid cash dividends on its Common Stock.
The shares of Common Stock have no preemptive or conversion rights, redemption
rights, or sinking fund provisions. The outstanding shares of Common Stock are,
and the shares of Common Stock offered hereby upon issuance and sale will be,
duly authorized, validly issued, fully paid, and nonassessable.

51
<PAGE> 53

PREFERRED STOCK

The Company has no outstanding Preferred Stock. The Company is authorized
to issue 10 million shares of Preferred Stock. The Company's Board of Directors
may establish, without stockholder approval, one or more classes or series of
Preferred Stock having the number of shares, designations, relative voting
rights, dividend rates, liquidation and other rights, preferences, and
limitations that the Board of Directors may designate. The Company believes that
this power to issue Preferred Stock will provide flexibility in connection with
possible corporate transactions. The issuance of Preferred Stock, however, could
adversely affect the voting power of holders of Common Stock and restrict their
rights to receive payments upon liquidation of the Company. It could also have
the effect of delaying, deferring or preventing a change in control of the
Company. The Company does not currently plan to issue Preferred Stock.

DELAWARE LAW PROVISIONS

The Company is a Delaware corporation and is subject to Section 203 of the
Delaware General Corporation Law. Generally, Section 203 prohibits the Company
from engaging in a "business combination" (as defined in Section 203) with an
"interested stockholder" (defined generally as a person owning 15% or more of
the Company's outstanding voting stock) for three years following the date that
person becomes an interested stockholder, unless (a) before that person became
an interested stockholder, the Company's Board of Directors approved the
transaction in which the interested stockholder became an interested stockholder
or approved the business combination; (b) upon completion of the transaction
that resulted in the interested stockholder's becoming an interested
stockholder, the interested stockholder owns at least 85% of the voting stock
outstanding at the time the transaction commenced (excluding stock held by
directors who are also officers of the Company and by employee stock plans that
do not provide employees with the right to determine confidentially whether
shares held subject to the plan will be tendered in a tender or exchange offer);
or (c) following the transaction in which that person became an interested
stockholder, the business combination is approved by the Company's Board of
Directors and authorized at a meeting of stockholders by the affirmative vote of
the holders of at least two-thirds of the outstanding voting stock not owned by
the interested stockholder.

Under Section 203, these restrictions also do not apply to certain business
combinations proposed by an interested stockholder following the announcement or
notification of one of certain extraordinary transactions involving the Company
and a person who was not an interested stockholder during the previous three
years or who became an interested stockholder with the approval of a majority of
the Company's directors, if that extraordinary transaction is approved or not
opposed by a majority of the directors who were directors before any person
became an interested stockholder in the previous three years or who were
recommended for election or elected to succeed such directors by a majority of
such directors then in office.

REGISTRATION RIGHTS

The Company has entered into a Registration Rights Agreement with General
Atlantic Partners III, L.P., GAP-Brigham Partners, L.P., RIMCO Partners, L.P.
II, RIMCO Partners, L.P. III and RIMCO Partners, L.P. IV, Ben M. Brigham, Anne
L. Brigham, Harold D. Carter, Craig M. Fleming, David T. Brigham and Jon L.
Glass. Pursuant to the Registration Rights Agreement, Anne and Ben Brigham,
acting together, the General Atlantic entities the RIMCO entities each may
separately require the Company to register securities, on one occasion, if the
shares to be registered have an estimated aggregate offering price to the public
of at least $3 million. One additional registration is allowed if any
registrable securities requested to be included in a previous registration
statement were not disposed of in accordance with that previous registration.
The Registration Rights Agreement also provides "piggyback" registration rights
after the Offering for all registrations of registrable securities for the
Company or another security holder. In an underwritten offering, however, the
Company may exclude all or a portion of the securities being registered pursuant
to "piggyback" registration rights if the managing underwriter determines that
including those securities would raise a substantial doubt about whether the
proposed offering could be consummated. The Registration Rights Agreement
contains customary indemnity by the Company in favor of persons selling

52
<PAGE> 54

securities in a registration governed by the Registration Rights Agreement, and
by those persons in favor of the Company, relating to the information included
in or omitted from the Registration Statement.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for the Common Stock is
.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of the Offering, the Company will have
shares of Common Stock outstanding ( shares if the
Underwriters exercise their over-allotment option in full). Of these
shares, the shares of Common Stock offered hereby will be freely
transferable without restriction under the Securities Act unless they are held
by the Company's affiliates, as that term is used in Rule 144 under the
Securities Act. The Company issued the remaining 8,928,571 shares of Common
Stock in reliance on exemptions from the registration requirements of the
Securities Act, and those shares are "restricted" securities under Rule 144.
Those shares may not be sold publicly unless they are registered under the
Securities Act, sold in compliance with Rule 144, or sold in a transaction that
is exempt from registration. The Company believes that the earliest date on
which the 8,928,571 shares of its Common Stock currently outstanding will be
eligible for sale under Rule 144 is February 27, 1998. Therefore, no shares will
be eligible for immediate sale in the public market without restriction under
Rule 144(k), and no shares will be eligible for immediate sale under the volume
and other limitations of Rule 144. Beginning February 27, 1998, all of the
shares of Common Stock currently outstanding will become eligible for sale under
Rule 144, based on current SEC rules and subject to compliance with the volume
and other requirements of Rule 144. Beginning February 27, 1999, all of those
shares of Common Stock will become eligible for sale under Rule 144(k) if they
are not held by affiliates of the Company.

In general, under Rule 144 a person (or persons whose sales are
aggregated), including an affiliate, who has beneficially owned shares for at
least one year is entitled to sell in broker transactions, within any three-
month period commencing 90 days after the Offering, a number of shares that does
not exceed the greater of (i) 1% of the then outstanding Common Stock
(approximately shares immediately after the Offering) or (ii) the
average weekly trading volume in the Common Stock during the four calendar weeks
preceding the sale, subject to the filing of a Form 144 with respect to the sale
and other limitations. In addition, a person who was not an affiliate of the
Company during the three months preceding a sale and who has beneficially owned
the shares proposed to be sold for at least two years is entitled to sell the
shares under Rule 144(k) without regard to the manner-of-sale, volume and other
limitations of Rule 144. The SEC has proposed modifications to Rule 144 that
could change some of these requirements. All shares of Common Stock, other than
those offered hereby, are subject to lock-up agreements with the Underwriters
for 180 days after the date of this Prospectus. See "Underwriting."

The holders of approximately 8,421,428 shares of Common Stock and their
permitted transferees are entitled to demand registration of those shares under
the Securities Act beginning 180 days after the date of this Prospectus. See
"Description of Capital Stock -- Registration Rights."

Prior to the Offering, there has been no public market for the securities
of the Company. No prediction can be made of the effect, if any, that the sale
or availability for sale of shares of additional Common Stock will have on the
market price of the Common Stock. Nevertheless, sales of substantial numbers of
shares by existing stockholders or by stockholders purchasing in the Offering
could have a negative effect on the market price of the Common Stock.

53
<PAGE> 55

UNDERWRITING

The Underwriters named below (the "Underwriters"), for whom Bear, Stearns &
Co. Inc., Howard, Weil, Labouisse, Friedrichs Incorporated and Petrie Parkman &
Co., Inc. are acting as Representatives (the "Representatives"), have severally
agreed, subject to the terms and conditions of the Underwriting Agreement, to
purchase from the Company and the Selling Stockholders the aggregate number of
shares of Common Stock set forth opposite their names below:

<TABLE>
<CAPTION>
NUMBER
UNDERWRITER OF SHARES
----------- ---------
<S> <C>
Bear, Stearns & Co. Inc. ...............
Howard, Weil, Labouisse, Friedrichs
Incorporated..........................
Petrie Parkman & Co., Inc. .............
---------
Total.........................
=========
</TABLE>

The Underwriting Agreement provides that the obligations of the
Underwriters thereunder are subject to the approval of certain legal matters by
their counsel and to various other conditions. The nature of the obligations of
the Underwriters is such that they are committed to purchase all of the shares
of Common Stock offered hereby if any are purchased.

The Representatives have advised the Company that the Underwriters propose
initially to offer the shares of Common Stock offered hereby directly to the
public at the initial public offering price set forth on the cover page of this
Prospectus. The Underwriters may allow a selected dealer concession of not more
than $ per share, and the Underwriters may allow, and such dealers may
reallow, concessions not in excess of $ per share to certain other dealers.
After the initial public offering, the public offering price and concessions and
reallowances to dealers may be changed by the Representatives.

The Company and the Selling Stockholders have granted an option to the
Underwriters, exercisable at any time during the 30-day period after the date of
this Prospectus, to purchase from the Company and the Selling Stockholders up to
an additional shares of Common Stock at the initial public
offering price set forth on the cover page of this Prospectus, less the
underwriting discount. Of this amount, an option to purchase
shares has been granted by the Company, shares by General
Atlantic Partners, L.L.C., shares by Anne L. Brigham and
shares by Ben M. Brigham. The Underwriters may exercise such
option solely for the purpose of covering over-allotments, if any, made in
connection with the sale of the shares of Common Stock offered hereby. To the
extent that the Underwriters exercise this option, each Underwriter will be
committed, subject to certain conditions, to purchase a number of the additional
shares of Common Stock proportionate to such Underwriter's purchase obligations
set forth in the table set forth above.

The Underwriting Agreement provides that the Company and the Selling
Stockholders will indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act, or will contribute
to payments the Underwriters may be required to make in respect thereof.

Each of the Company, its officers, directors, stockholders and
optionholders have entered into certain "lock-up" agreements with the
Underwriters with respect to the sale of shares of Common Stock. Under these
"lock-up" agreements, the Company, its officers, directors, stockholders and
optionholders have agreed not to offer, sell, agree to sell, grant any option
for the sale of or otherwise dispose of, directly or indirectly, any shares of
Common Stock (or any security convertible into, exercisable for or exchangeable
for Common Stock) without the consent of Bear, Stearns & Co. Inc. for a period
of 180 days after the date of this Prospectus, except that the Company may issue
shares of Common Stock upon the exercise of options granted under its stock
option plans. After the expiration of the "lock-up" agreements, such persons
will be entitled to sell, distribute or otherwise dispose of the Common Stock
that they hold subject to the provisions of applicable securities laws.

The Representatives have advised the Company that the Underwriters do not
expect to confirm sales to discretionary accounts.

54
<PAGE> 56

The Underwriters are reserving up to shares of Common Stock in the
Offering for sales to officers, directors and employees of the Company and their
friends and relatives at the initial public offering price. Any shares of Common
Stock not purchased by those persons will be sold to the general public in the
Offering.

The Representatives have informed the Company that they do not expect sales
to discretionary accounts by the Underwriters to exceed five percent of the
total number of shares of Common Stock offered by them.

Prior to the Offering, there has been no public market for the Common
Stock. The initial public offering price will be determined by negotiation
between the Company and the Representatives. Among the factors which will be
considered in these negotiations are the Company's history, capital structure
and financial condition, its past and present earnings and the trend of such
earnings, prospects for the Company and its industry, the present state of the
Company's development, the recent market prices of publicly-held companies that
the Company and the Representatives believe to be comparable to the Company and
general conditions prevailing in the securities markets at the time of the
Offering.

LEGAL MATTERS

Certain legal matters in connection with the Common Stock being offered
hereby will be passed upon for the Company by Thompson & Knight, P.C., Dallas,
Texas. Certain legal matters will be passed upon for the Underwriters by Vinson
& Elkins L.L.P., Dallas, Texas.

EXPERTS

The financial statements of Brigham Oil and Gas, L.P. as of December 31,
1996 and 1995 and for each of the three years in the period ended December 31,
1996 and the Balance Sheet of Brigham Exploration Company as of February 26,
1997 included in this Prospectus have been so included in reliance on the
reports of Price Waterhouse LLP, independent accountants, given on authority of
said firm as experts in auditing and accounting.

The letter of Cawley, Gillespie & Associates, Inc., independent oil and gas
consultants, set forth in this Prospectus as Appendix A has been included herein
in reliance upon the firm as expert with respect to the matters contained in
that letter. In addition, the information with respect to the reserve reports
prepared by Cawley Gillespie has been included herein in reliance upon by the
firm as experts with respect to such information.

AVAILABLE INFORMATION

The Company has filed with the Commission a Registration Statement on Form
S-1 (as amended and together with all exhibits thereto, the "Registration
Statement") under the Securities Act, with respect to the shares of Common Stock
offered by this Prospectus. This Prospectus constitutes a part of the
Registration Statement and does not contain all of the information set forth in
the Registration Statement, certain parts of which are omitted from this
Prospectus as permitted by the rules and regulations of the SEC. Statements in
this Prospectus about the contents of any contract or other document are not
necessarily complete; reference is made in each instance to the copy of the
contract or other document filed as an exhibit to the Registration Statement.
Each such statement is qualified in all respects by such reference. The
Registration Statement and accompanying exhibits and schedules may by inspected
and copies may be obtained (at prescribed rates) at the public reference
facilities of the SEC at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549. Copies of the Registration Statement may also be
inspected at the SEC's regional offices at 7 World Trade Center, Suite 1300, New
York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. In addition, the Common Stock will be listed on
the Nasdaq National Market, 1735 K Street, N.W., Washington, D.C. 20006-1500,
where such material may also be inspected and copied.

As a result of the Offering, the Company will become subject to the
information and periodic reporting requirements of the Securities Exchange Act
of 1934, and, in accordance therewith, will file periodic reports,

55
<PAGE> 57

proxy statements and other information with the SEC. Such periodic reports,
proxy statements and other information will be available for inspection and
copying at the public reference facilities and regional offices referred to
above. In addition, these reports, proxy statements and other information may
also be obtained from the web site that the SEC maintains at http://www.sec.gov.

The Company intends to furnish its shareholders annual reports containing
consolidated financial statements certified by its independent auditors and
quarterly reports for each of the first three quarters of each fiscal year
containing unaudited financial information.

56
<PAGE> 58

GLOSSARY OF CERTAIN OIL AND GAS TERMS

The following are abbreviations and definitions of certain terms commonly
used in the oil and gas industry and this Prospectus.

Bbl. One stock tank barrel, or 42 U.S. gallons liquid volume, used herein
in reference to oil or other liquid hydrocarbons.

Bcf. One billion cubic feet.

Bcfe. One billion cubic feet of natural gas equivalent. In reference to
natural gas, natural gas equivalents are determined using the ratio of 6 Mcf of
natural gas to 1 Bbl of oil, condensate of natural gas liquids.

Completion. The installation of permanent equipment for the production of
oil or natural gas.

Developed Acreage. The number of acres which are allocated or assignable to
producing wells or wells capable of production.

Development Well. A well drilled within the proved area of an oil or
natural gas reservoir to the depth of a stratigraphic horizon known to be
productive.

Drilling Costs. The costs associated with drilling and completing a well
(exclusive of seismic and land acquisition costs for that well and future
development costs associated with proved undeveloped reserves added by the well)
divided by total proved reserve additions.

Dry Well. A well found to be incapable of producing either oil or natural
gas in sufficient quantities to justify completion of an oil or gas well.

Exploratory Well. A well drilled to find and produce oil or natural gas in
an unproved area, to find a new reservoir in a field previously found to be
productive of oil or gas in another reservoir, or to extend a known reservoir.

Finding and Development Costs. Capital costs incurred in the acquisition,
exploration and development of proved oil and natural gas reserves divided by
proved reserve additions.

Gross Acres or Gross Wells. The total acres or wells, as the case may be,
in which the Company has a working interest.

MBbl. One thousand barrels of oil or other liquid hydrocarbons.

Mcf. One thousand cubic feet of natural gas.

Mcfe. One thousand cubic feet of natural gas equivalent.

MMBbl. One million barrels of oil or other liquid hydrocarbons.

MMBtu. One million Btu, or British Thermal Units. One British Thermal Unit
is the quantity of heat required to raise the temperature of one pound of water
by one degree Fahrenheit.

MMcf. One million cubic feet of natural gas.

MMcfe. One million cubic feet of natural gas equivalent.

Net Acres or Net Wells. Gross acres or wells multiplied, in each case, by
the percentage working interest owned by the Company.

Net Production. Production that is owned by the Company less royalties and
production due others.

Oil. Crude oil or condensate.

Operator. The individual or company responsible for the exploration,
development, and production of an oil or gas well or lease.

Present Value of Future Net Revenues or PV-10. The pretax present value of
estimated future revenues to be generated from the production of proved reserves
calculated in accordance with SEC guidelines, net of

57
<PAGE> 59

estimated production and future development costs, using prices and costs as of
the date of estimation without future escalation, without giving effect to
non-property related expenses such as general and administrative expenses, debt
service and depreciation, depletion and amortization, and discounted using an
annual discount rate of 10%.

Proved Developed Reserves. Reserves that can be expected to be recovered
through existing wells with existing equipment and operating methods.

Proved Reserves. The estimated quantities of crude oil, natural gas and
natural gas liquids 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 Undeveloped Reserves. Reserves that are expected to be recovered
from new wells on undrilled acreage or from existing wells where a relatively
major expenditure is required for recompletion.

Royalty. An interest in an oil and gas lease that gives the owner of the
interest the right to receive a portion of the production from the leased
acreage (or of the proceeds of the sale thereof), but generally does not require
the owner to pay any portion of the costs of drilling or operating the wells on
the leased acreage. Royalties may be either landowner's royalties, which are
reserved by the owner of the leased acreage at the time the lease is granted, or
overriding royalties, which are usually reserved by an owner of the leasehold in
connection with a transfer to a subsequent owner.

Spud. Start drilling a new well (or restart).

Success Rate. The number of wells completed as a percentage of the number
of wells drilled.

2-D Seismic. The method by which a cross-section of the earth's subsurface
is created through the interpretation of reflecting seismic data collected along
a single source profile.

3-D Seismic. The method by which a three dimensional image of the earth's
subsurface is created through the interpretation of reflection seismic data
collected over surface grid. 3-D seismic surveys allow for a more detailed
understanding of the subsurface than do conventional surveys and contribute
significantly to field appraisal, development and production.

Working Interest. An interest in an oil and gas lease that gives the owner
of the interest the right to drill for and produce natural gas and oil on the
leased acreage and requires the owner to pay a share of the costs of drilling
and production operations.

58
<PAGE> 60
INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Unaudited Pro Forma Financial Statements of Brigham Exploration Company F1-2

Unaudited Pro Forma Balance Sheet F1-3

Unaudited Pro Forma Statement of Operations F1-4

Notes to the Unaudited Pro Forma Financial Statements F1-5

Balance Sheet of Brigham Exploration Company

Report of Independent Accountants F2-1

Balance Sheet as of February 26, 1997 F2-2

Notes to the Balance Sheet F2-3

Financial Statements of Brigham Oil & Gas, L.P.

Report of Independent Accountants F3-1

Balance Sheets as of December 31, 1995 and 1996 F3-2

Statements of Operations for the Years Ended December 31, 1994, 1995, and 1996 F3-3

Statements of Partners' Capital as of December 31, 1994, 1995, and 1996 F3-4

Statements of Cash Flows for the Years Ended December 31, 1994, 1995, and 1996 F3-5

Notes to the Financial Statements F3-6
</TABLE>

F1-1
<PAGE> 61
BRIGHAM EXPLORATION COMPANY
(A NEWLY FORMED DELAWARE CORPORATION)

UNAUDITED PRO FORMA FINANCIAL STATEMENTS

The following Unaudited Pro Forma Financial Statements of the Company have been
prepared to give effect to the Exchange described on page 17 in the
Prospectus, the issuance of employee stock options under the 1997 Incentive
Plan and the issuance of Common Stock pursuant to the Offering (and the
application of the estimated net proceeds therefrom) as if these events had
taken place on December 31, 1996 for purposes of the Unaudited Pro Forma
Balance Sheet and as if these events had taken place on January 1, 1996 for
purposes of the Unaudited Pro Forma Statement of Operations.

The Unaudited Pro Forma Financial Statements of the Company are not necessarily
indicative of the results for the periods presented had the Exchange, the
issuance of employee stock options under the 1997 Incentive Plan and the
issuance of Common Stock pursuant to the Offering (and the application of the
estimated net proceeds therefrom) taken place on January 1, 1996. In addition,
future results may vary significantly from the results reflected in the
accompanying Unaudited Pro Forma Financial Statements because of normal
production declines, changes in product prices, and the success of future
exploration and development activities, among other factors. This information
should be read in conjunction with the Balance Sheet of Brigham Exploration
Company and the Financial Statements of Brigham Oil & Gas, L.P., and the notes
thereto, all included elsewhere herein.

F1-2
<PAGE> 62
BRIGHAM EXPLORATION COMPANY

UNAUDITED PRO FORMA BALANCE SHEET
DECEMBER 31, 1996
(in thousands)

PRO FORMA
BRIGHAM OIL PRO FORMA OFFERING PRO FORMA
AND GAS, L.P. ADJUSTMENTS PRO FORMA ADJUSTMENTS AS ADJUSTED
------------ ----------- ------------ ------------ -----------
<S> <C> <C> <C> <C> <C>

ASSETS
Current assets:
Cash and cash equivalents $ 1,447 $ -- $ 1,447 $ (d) $
(e)
Accounts receivable 2,696 -- 2,696
Prepaid expenses 152 -- 152
-------- -------- -------- -------- --------
Total current assets 4,295 -- 4,295
-------- -------- -------- -------- --------

Natural gas and oil properties, at cost, net 28,005 -- 28,005
Other property and equipment, at cost, net 532 -- 532
Drilling advances paid 419 -- 419
Other noncurrent assets 363 -- 363
-------- -------- -------- -------- --------
$ 33,614 $ -- $ 33,614 $ $
======== ======== ======== ======== ========

LIABILITIES AND PARTNERS' CAPITAL/STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable $ 2,937 $ -- $ 2,937 $ $
Accrued drilling costs 915 -- 915
Participant advances received 1,137 -- 1,137
Other current liabilities 628 -- 628
-------- -------- -------- -------- --------
Total current liabilities 5,617 -- 5,617
-------- -------- -------- -------- --------

Notes payable 8,000 -- 8,000 (e)
Subordinated notes payable - related party 16,000 (16,000)(b) --
Deferred interest payable - related party 433 (433)(b) --
Other noncurrent liabilities 320 -- 320
Deferred income tax liability -- 5,112 (a) 5,112

Partners' capital/stockholders' equity:
Partners' capital:
General partners 3,190 (3,190)(b) --
Limited partners 54 (54)(b) --

Stockholders' equity:
Preferred stock, $.01 par value,
10 million shares authorized -- -- --
Common stock, $.01 par value,
30 million shares authorized -- 89 (b) 89 (d)
Additional paid-in-capital -- 19,588 (b) 25,115 (d)
5,527 (c)
Unearned stock compensation -- (5,527)(c) (5,527)
Accumulated deficit -- (5,112)(a) (5,112)
-------- -------- -------- -------- --------
Total partners' capital/stockholders' equity 3,244 11,321 14,565
-------- -------- -------- -------- --------

$ 33,614 $ -- $ 33,614 $ $
======== ======== ======== ======== ========
</TABLE>

The Company uses the full cost method to account for
its natural gas and oil properties.
See accompanying notes to the Unaudited Pro Forma Financial Statements.

F1-3
<PAGE> 63
BRIGHAM EXPLORATION COMPANY

UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1996
(in thousands, except per share data)

<TABLE>
<CAPTION>
PRO FORMA
BRIGHAM OIL PRO FORMA OFFERING PRO FORMA
AND GAS, L.P. ADJUSTMENTS PRO FORMA ADJUSTMENTS AS ADJUSTED
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Revenues:
Natural gas and oil sales $ 6,141 $ -- $ 6,141 $ $
Workstation revenue 627 -- 627
------------ ------------ ------------ ------------ ------------
6,768 -- 6,768
------------ ------------ ------------ ------------ ------------

Costs and expenses:
Lease operating 726 -- 726
Production taxes 362 -- 362
General and administrative 2,199 -- 2,199
Amortization of stock compensation -- 984 (c) 984
Depletion of natural gas and oil properties 2,323 82 (c) 2,405
Depreciation and amortization 487 -- 487
------------ ------------ ------------ ------------ ------------
6,097 1,066 7,163
------------ ------------ ------------ ------------ ------------

Operating income (loss) 671 (1,066) (395)
------------ ------------ ------------ ------------ ------------

Other income (expense):
Interest income 52 -- 52
Interest expense (373) -- (373) (e)
Interest expense - related party (800) 800 (b) --
------------ ------------ ------------ ------------ ------------

Net loss before income taxes (450) (266) (716)
Income tax benefit -- 330 (a) 330 (a)
------------ ------------ ------------ ------------ ------------
Net loss $ (450) $ 64 $ (386) $ $
============ ============ ============ ============ ============

Net loss per common share $ (0.04) $
============ ============

Weighted average number of
common shares outstanding 9,343 $
============ ============
</TABLE>

See accompanying notes to the Unaudited Pro Forma Financial Statements.

F1-4
<PAGE> 64
BRIGHAM EXPLORATION COMPANY

NOTES TO THE UNAUDITED PRO FORMA FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The accompanying Unaudited Pro Forma Financial Statements of the Company
have been prepared to give effect to the Exchange described on page 17 in
the Prospectus, the issuance of employee stock options under the 1997
Incentive Plan and the issuance of Common Stock pursuant to the Offering
(and the application of the estimated net proceeds therefrom) as if such
transactions had taken place on December 31, 1996 for purposes of the
Unaudited Pro Forma Balance Sheet and as if the transactions had taken
place on January 1, 1996 for purposes of the Unaudited Pro Forma Statement
of Operations. The Company was formed in February 1997 with a
capitalization of $30.

Because of a high degree of common ownership among Brigham Exploration
Company, Brigham, Inc. and Brigham Oil & Gas, L.P., as well as Brigham
Exploration Company's non-public status prior to the Exchange, and because
the only assets of the Company after the Exchange are those of the
Partnership prior to the Exchange, the Exchange has been accounted for
based on the carrying amounts of the Partnership's assets and liabilities.

2. PRO FORMA ADJUSTMENTS AND PRO FORMA OFFERING ADJUSTMENTS
The Unaudited Pro Forma Financial Statements reflect the following pro
forma adjustments related to the consummation of the Exchange, the
issuance of employee stock options under the 1997 Incentive Plan and the
issuance of Common Stock pursuant to the Offering (and the application of
the estimated net proceeds therefrom).

a. To record current and deferred federal income tax expense as if the
Partnership had been a taxable entity.

b. To record the issuance of 8,928,571 shares of Common Stock of the
Company in exchange for (i) all of the issued and outstanding stock
of Brigham, Inc., (ii) all of the partnership interests of the
Partnership's other general partner and its limited partners, and
(iii) the subordinated convertible notes.

c. To record unearned compensation and the amortization thereon related
to employee stock options granted under the 1997 Incentive Plan on
February 28, 1997. A portion of the amortization of the unearned
compensation was capitalized as part of the Company's amortizable
base of the full cost pool to the extent that this cost was directly
attributable to acquisition, exploration and development activities.
Depletion of natural gas and oil properties was adjusted accordingly.

d. To reflect the issuance of shares of Common Stock at the
assumed initial public offering price of $ per share for
estimated proceeds of $ , net of estimated underwriting
discounts and expenses of this Offering.

e. To record the partial use of the estimated net proceeds of the
Offering to fully repay borrowings under the Revolving Credit
Facility.

3. INCOME TAXES

Upon consummation of the Exchange, the Company will record a deferred tax
liability or asset for temporary differences between the financial
statement and tax bases of assets and liabilities at the Exchange date
given the provisions of enacted tax laws. Assuming the Exchange had
occurred on December 31, 1996, the Company would have incurred an
estimated charge of $5.1 million to record a deferred tax liability
primarily reflecting the difference between the tax bases and the
financial statement bases of the Partnership's natural gas and oil
properties. As this will be a nonrecurring charge, it has not been
included in the Unaudited Pro Forma Statement of Operations. The ultimate
tax bases and related difference from financial statement bases cannot be
ultimately determined until consummation of the Exchange, and such basis
differences will change depending upon the level and nature of operations
and the amount of taxable income and deductions allocated to the partners
through the date of the Exchange. Such basis differences could vary
materially from this estimate.

F1-5
<PAGE> 65
BRIGHAM EXPLORATION COMPANY

NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS (CONTINUED)

4. NET LOSS PER COMMON SHARE

Pro forma net loss per common share is presented giving effect to the
number of shares outstanding subsequent to the Exchange (8,928,571 shares)
and giving effect to 644,097 stock options issued under the 1997 Incentive
Plan on February 28, 1997. These options, which have an exercise
price of $ per share, are treated as Common Stock equivalents. The
number of equivalent shares was determined by the treasury stock method
based on the offering price of $ per share. In addition to the
effect of these events, pro forma, as adjusted, net loss per common share
gives effect to the shares of Common Stock issued pursuant to the
Offering.

F1-6
<PAGE> 66

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors
and Stockholders of Brigham Exploration Company

In our opinion, the accompanying balance sheet presents fairly, in all material
respects, the financial position of Brigham Exploration Company at February 26,
1997, in conformity with generally accepted accounting principles. This balance
sheet is the responsibility of the Company's management; our responsibility is
to express an opinion on the balance sheet based on our audit. We conducted our
audit in accordance with generally accepted auditing standards which 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, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for the
opinion expressed above.

PRICE WATERHOUSE LLP

Houston, Texas
February 26, 1997

F2-1
<PAGE> 67
BRIGHAM EXPLORATION COMPANY
(A NEWLY FORMED DELAWARE CORPORATION)

BALANCE SHEET
FEBRUARY 26, 1997

<TABLE>
<S> <C>
Assets:
Cash $ 30
============

Stockholders' equity:
Preferred stock, $.01 par value, 10 million shares authorized,
none issued and outstanding $ --
Common stock, $.01 par value, 30 million shares
authorized, 3 shares issued and outstanding --
Additional paid-in capital 30
------------

Total stockholders' equity $ 30
============
</TABLE>

See accompanying notes to the balance sheet.

F2-2
<PAGE> 68
BRIGHAM EXPLORATION COMPANY
(A NEWLY FORMED DELAWARE CORPORATION)

NOTES TO THE BALANCE SHEET
FEBRUARY 26, 1997

1. ORGANIZATION AND BUSINESS PURPOSE

Brigham Exploration Company (the "Company") is a Delaware corporation
formed on February 25, 1997 for the purpose of exchanging its common stock
for the common stock of Brigham, Inc. and the partners' interests in
Brigham Oil & Gas, L.P. (the "Partnership"). Additionally, the Company
will exchange shares with the holder of the Partnership's subordinated
convertible notes which would otherwise be convertible into a 19.65%
interest in the Partnership. These transactions are referred to as the
"Exchange". In completing the Exchange, the Company expects to issue
8,928,571 shares of common stock to the stockholders of Brigham, Inc.,
the partners of the Partnership and the holder of the Partnership's
subordinated notes payable.

The Company expects to initiate a public issuance of common stock in early
1997.

2. STOCKHOLDERS' EQUITY

The Board of Directors of the Company is empowered, without approval of
stockholders, to cause shares of preferred stock to be issued in one or
more series. The Board of Directors is authorized to fix and determine
variations in designations, preferences and relative, participating,
optional or other special rights and the limitations or restrictions of
such rights and voting powers.

Holders of common stock are entitled to one vote per share in the election
of directors and on all other matters submitted to a vote of common
stockholders. The common stock does not have cumulative voting rights.
Holders of common stock are entitled to receive dividends, if any, as may
be declared by the Board of Directors out of funds legally available
therefore, subject to any preferential dividend rights of holders of
outstanding preferred stock.

3. STOCK COMPENSATION

The Board of Directors and stockholders of the Company anticipate the
adoption of an incentive plan, to be effective upon completion of the
Exchange, which will provide for the issuance of stock options, stock
appreciation rights, stock, restricted stock, cash or any combination of
the foregoing. The objective of this plan will be to reward key employees
whose performance may have a significant effect on the success of the
Company. An aggregate of 1,588,169 shares of common stock will be reserved
for issuance pursuant to this plan with 644,097 shares subject to initial
grants of stock options. These options will have an exercise price less
than the public offering price. The grant will result in noncash
compensation expense which will be recognized over the appropriate vesting
period. The Compensation Committee of the Board of Directors will
determine the type of awards made to each participant and the terms,
conditions and limitations applicable to each award.

On February 26, 1997, in connection with the Exchange (see Note 1), three
employees who had been granted restricted interests in the Partnership in
1994 agreed to transfer, upon the initial filing in early 1997 of a
registration statement with the SEC for a public offering of common stock,
these partnership interests to the Company in exchange for 156,250 shares
of restricted common stock. The terms of the restricted stock and the
restricted partnership interests are substantially the same. The shares
vest over a three year period ending in 1999. No compensation expense will
result from this exchange.

F2-3
<PAGE> 69

REPORT OF INDEPENDENT ACCOUNTANTS

To the Partners of
Brigham Oil & Gas, L.P.

In our opinion, the accompanying balance sheets and the related statements of
operations, of partners' capital and of cash flows present fairly, in all
material respects, the financial position of Brigham Oil & Gas, L.P. at
December 31, 1996 and 1995, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1996, in
conformity with generally accepted accounting principles. These financial
statements are the responsibility of the Partnership's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards which 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, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for the
opinion expressed above.

PRICE WATERHOUSE LLP

Houston, Texas
February 26, 1997

F3-1
<PAGE> 70
BRIGHAM OIL & GAS, L.P.
BALANCE SHEETS
(in thousands)

<TABLE>
<CAPTION>
December 31,
---------------------------
1995 1996
------------ ------------
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 1,802 $ 1,447
Accounts receivable 1,256 2,696
Prepaid expenses 177 152
------------ ------------

Total current assets 3,235 4,295
------------ ------------

Natural gas and oil properties, at cost, net 18,538 28,005
Other property and equipment, at cost, net 684 532
Drilling advances paid 127 419
Other noncurrent assets 332 363
------------ ------------

$ 22,916 $ 33,614
============ ============

LIABILITIES AND PARTNERS' CAPITAL

Current liabilities:
Accounts payable $ 1,318 $ 2,937
Accrued drilling costs 588 915
Participant advances received 333 1,137
Other current liabilities 689 628
------------ ------------

Total current liabilities 2,928 5,617
------------ ------------

Notes payable -- 8,000
Subordinated notes payable - related party 16,000 16,000
Deferred interest payable - related party 113 433
Other noncurrent liabilities 181 320

Commitments and contingencies

Partners' capital:
General partners 3,620 3,190
Limited partners 74 54
------------ ------------

Total partners' capital 3,694 3,244
------------ ------------

$ 22,916 $ 33,614
============ ============
</TABLE>

The Partnership uses the full cost method to account for
its natural gas and oil properties.
See accompanying notes to the financial statements.

F3-2
<PAGE> 71
BRIGHAM OIL & GAS, L.P.

STATEMENTS OF OPERATIONS
(in thousands, except per share data)

<TABLE>
<CAPTION>
Year ended December 31,
--------------------------------------
1994 1995 1996
---------- ---------- ----------
<S> <C> <C> <C>
Revenues:
Natural gas and oil sales $ 2,565 $ 3,578 $ 6,141
Workstation revenue 815 635 627
---------- ---------- ----------
3,380 4,213 6,768
---------- ---------- ----------

Costs and expenses:
Lease operating 491 761 726
Production taxes 126 165 362
General and administrative 1,785 1,897 2,199
Depletion of natural gas and oil properties 1,104 1,626 2,323
Depreciation and amortization 561 533 487
---------- ---------- ----------
4,067 4,982 6,097
---------- ---------- ----------
Operating income (loss) (687) (769) 671
---------- ---------- ----------

Other income (expense):
Interest income 56 128 52
Interest expense (76) (187) (373)
Interest expense - related party (592) (749) (800)
---------- ---------- ----------
Net loss $ (1,299) $ (1,577) $ (450)
========== ========== ==========

Unaudited pro forma information (Notes 1 and 2)
Net loss $ (450)
Pro forma Exchange adjustments (266)
----------

Pro forma net loss before taxes (716)
Pro forma income tax benefit 330
----------

Pro forma net loss $ (386)
==========

Pro forma net loss per common share $ (0.04)
==========

Pro forma weighted average number of common shares outstanding 9,343
==========
</TABLE>

See accompanying notes to the financial statements.

F3-3
<PAGE> 72
BRIGHAM OIL & GAS, L.P.

STATEMENTS OF PARTNERS' CAPITAL
(in thousands)

<TABLE>
<CAPTION>
General Limited
Partners Partners Total
------------ ------------ ------------
<S> <C> <C> <C>
Balance at December 31, 1993 $ 6,364 $ 206 $ 6,570

Net loss (1,239) (60) (1,299)
------------ ------------ ------------

Balance at December 31, 1994 5,125 146 5,271

Net loss (1,505) (72) (1,577)
------------ ------------ ------------

Balance at December 31, 1995 3,620 74 3,694

Net loss (430) (20) (450)
------------ ------------ ------------

Balance at December 31, 1996 $ 3,190 $ 54 $ 3,244
============ ============ ============
</TABLE>

See accompanying notes to the financial statements.

F3-4
<PAGE> 73
BRIGHAM OIL & GAS, L.P.

STATEMENTS OF CASH FLOWS
(in thousands)

<TABLE>
<CAPTION>
Year ended December 31,
--------------------------------------
1994 1995 1996
---------- ---------- ----------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (1,299) $ (1,577) $ (450)
Adjustments to reconcile net loss to cash
provided by operating activities:
Depletion of natural gas and oil properties 1,104 1,626 2,323
Depreciation and amortization 561 533 487
Changes in working capital and other items:
(Increase) decrease in accounts receivable 2,074 413 (1,440)
(Increase) decrease in prepaid expenses (29) (107) 25
Increase (decrease) in accounts payable (1,451) 128 1,619
Increase (decrease) in participant advances
received (170) 92 804
Increase (decrease) in other current liabilities (121) 151 60
Increase in deferred interest payable - related
party -- 113 320
Other noncurrent assets (43) (26) (224)
Other noncurrent liabilities -- 37 186
---------- ---------- ----------
Net cash provided by operating activities 626 1,383 3,710
---------- ---------- ----------

Cash flows from investing activities:
Additions to natural gas and oil properties (5,445) (7,935) (13,612)
Proceeds from the sale of natural gas
and oil properties -- -- 2,149
Additions to other property and equipment (62) (51) (41)
(Increase) decrease in drilling advances paid 44 (19) (292)
---------- ---------- ----------
Net cash used by investing activities (5,463) (8,005) (11,796)
---------- ---------- ----------

Cash flows from financing activities:
Proceeds from issuance of subordinated
notes payable -- 16,000 --
Increase in notes payable 4,950 2,560 8,000
Repayment of notes payable -- (10,510) --
Principal payments on capital lease obligations (316) (326) (269)
---------- ---------- ----------
Net cash provided by financing activities 4,634 7,724 7,731
---------- ---------- ----------

Net increase (decrease) in cash and cash
equivalents (203) 1,102 (355)

Cash and cash equivalents, beginning of year 903 700 1,802
---------- ---------- ----------
Cash and cash equivalents, end of year $ 700 $ 1,802 $ 1,447
========== ========== ==========

Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 667 $ 654 $ 762
========== ========== ==========

Supplemental disclosure of noncash
investing and financing activities:
Capital lease asset additions $ 361 $ 208 $ 101
========== ========== ==========
</TABLE>

See accompanying notes to the financial statements.

F3-5
<PAGE> 74
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

1. ORGANIZATION AND NATURE OF OPERATIONS

Brigham Oil & Gas, L.P. (the "Partnership") was formed in May 1992 to
explore and develop onshore domestic natural gas and oil properties using
3-D seismic imaging and other advanced technologies. Since its inception,
the Partnership has focused its exploration and development of natural gas
and oil properties in the Permian and Hardeman Basins of West Texas,
the Anadarko Basin and the Gulf Coast.

Brigham, Inc. is the managing general partner of the Partnership and has a
54% interest in the Partnership. Brigham, Inc. generally directs all
activities of the Partnership. The other general partner holds a 38%
interest in the Partnership, has participating rights in certain Major
Decisions, as defined, and has a preference in the allocation of profits
and other items until it recovers its initial investment.

Pursuant to an Exchange Agreement dated February 26, 1997 (the "Exchange
Agreement") and upon the initial filing in early 1997 of a registration
statement with the Securities and Exchange Commission for a public
offering of common stock, the shareholders of Brigham, Inc. have agreed to
transfer all of the outstanding stock of Brigham, Inc. to a newly formed
entity, Brigham Exploration Company (the "Company"), in exchange for
shares of common stock of the Company. Brigham, Inc. is a Texas
corporation whose only significant asset is its ownership interest in the
Partnership. Pursuant to the Exchange Agreement, the Partnership's other
general partner and the limited partners have agreed to transfer all of
their partnership interests to the Company in exchange for shares of
common stock of the new entity. Furthermore, the holders of the
subordinated convertible notes (see Note 4) have agreed to transfer these
notes to the Company in exchange for shares of common stock. As a result
of these transactions, hereafter referred to as the "Exchange," the
Company will own all the partnership interests in the Partnership.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

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 may differ from those
estimates.

Cash and Cash Equivalents

The Partnership considers all highly liquid financial instruments with an
original maturity of three months or less to be cash equivalents.

Property and Equipment

The Partnership uses the full cost method of accounting for its investment
in natural gas and oil properties. Under this method, all acquisition,
exploration and development costs, including certain payroll and other
internal costs, incurred for the purpose of finding natural gas and oil
reserves are capitalized. Costs associated with production and general
corporate activities are expensed in the period incurred.

The capitalized costs of the Partnership's natural gas and oil properties
plus future development, dismantlement, restoration and abandonment costs
(the "Amortizable Base"), net of estimated salvage values, are amortized
using the unit-of-production method based upon estimates of total proved
reserve quantities. The Partnership's capitalized costs of its natural gas
and oil properties, net of accumulated depletion, are limited to the total
of estimated future net cash flows from proved natural gas and oil
reserves, discounted at ten percent, plus the cost of unevaluated
properties. There are many factors, including global events, that may
influence the production, processing, marketing and valuation of natural
gas and oil. A reduction in the valuation of natural gas and oil
properties resulting from declining prices or production could adversely
impact depletion rates and ceiling test limitations.

F3-6
<PAGE> 75
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

All costs directly associated with the acquisition and evaluation of
unproved properties are initially excluded from the Amortizable Base. Upon
the interpretation by the Partnership of the 3-D seismic data associated
with unproved properties, the geological and geophysical costs of acreage
that is not specifically identified as prospective are added to the
Amortizable Base. Geological and geophysical costs associated with
prospective acreage, as well as leasehold costs, are added to the
Amortizable Base when the prospects are drilled. Costs of prospective
acreage are reviewed annually for impairment on a property-by-property
basis.

Effective January 1, 1996, the Partnership changed its accounting policy
for certain payroll and other internal costs directly attributable to
acquisition, exploration and development activities. Under the new policy,
the Partnership capitalizes these costs as part of its investment in
natural gas and oil properties to recognize internal costs directly
attributable to acquisition, exploration, and development activities over
the periods benefited by these activities. Because the Company intends to
initiate a public issuance of common stock, the financial statements of
prior years have been restated to apply the new accounting principle
retroactively. Under the new accounting policy, certain payroll and other
internal costs incurred during the years ended December 31, 1994, 1995,
and 1996 of $1,320,114, $1,640,196, and $1,826,013, respectively, have
been capitalized.

Other property and equipment, which primarily consists of 3-D seismic
interpretation workstations, are depreciated on a straight-line basis over
the estimated useful lives of the assets after considering salvage value.
Estimated useful lives are as follows:

Furniture and fixtures 10 years
Machinery and equipment 5 years
3-D seismic interpretation workstations and software 3 years

Betterments and major improvements that extend the useful lives are
capitalized, while expenditures for repairs and maintenance of a minor
nature are expensed as incurred.

Revenue Recognition

The Partnership recognizes natural gas and oil sales from its interests in
producing wells under the sales method of accounting. Under the sales
method, the Partnership recognizes revenues based on the amount of natural
gas or oil sold to purchasers, which may differ from the amounts to which
the Partnership is entitled based on its interest in the properties. Gas
balancing obligations as of December 31, 1994, 1995 and 1996 were not
significant. Net realized gains or losses arising from the Partnership's
crude oil price swaps (see Note 7) are recognized in the period incurred
as a component of natural gas and oil sales.

Industry participants in the Partnership's seismic programs are charged on
an hourly basis for the work performed by the Partnership on its 3-D
seismic interpretation workstations. The Partnership recognizes
workstation revenue as service is provided.

Federal and State Income Taxes

The financial statements include only those assets, liabilities and
operations that relate to the business of the Partnership. The financial
statements do not include any assets, liabilities or operations
attributable to the partners' individual activities. No provision has been
made for income taxes since these taxes are the responsibility of the
partners.

F3-7
<PAGE> 76
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

Upon consummation of the Exchange, the Company will record a deferred tax
liability or asset for temporary differences between the financial
statement and tax bases of assets and liabilities at the Exchange date
given the provisions of enacted tax laws. Assuming the Exchange had
occurred on December 31, 1996, the Company would have incurred an
estimated charge of $5.1 million to record a deferred tax liability
primarily reflecting the difference between the tax bases and the
financial statement bases of the Partnership's natural gas and oil
properties. The ultimate tax bases and related difference from financial
statement bases cannot be ultimately determined until consummation of the
Exchange and such basis differences will change depending upon the level
and nature of operations and the amount of taxable income and deductions
allocated to the partners through the date of the Exchange. Such basis
differences could vary materially from this estimate.

Unaudited Pro Forma Information

The Partnership's legal form has no relation to the capital structure of
the Company after the Exchange. As a result, historical loss per unit
amounts are not relevant and have not been presented.

Pro forma net loss for the year ended December 31, 1996 reflects the
Exchange, including income taxes that would have been recorded had the
Partnership been a taxable entity. Pro forma exchange adjustments
primarily represent the amortization of the compensation expense related
to employee stock options granted upon the formation of the Company (see
Note 8), and the reduction of interest expense related to the transfer of
the subordinated notes payable to the Company as part of the Exchange. Pro
forma income taxes have been included in the Statement of Operations
pursuant to the rules and regulations of the SEC for instances when a
partnership becomes subject to federal income taxes.

Pro forma net loss per common share is presented giving effect to the
number of shares outstanding subsequent to the Exchange (8,928,571 shares)
and giving effect to the shares to be issued under the anticipated
February 1997 employee stock option grants (see Note 8). Pro forma net
loss per common share was calculated using the treasury stock method.

Reclassification of Prior Years

Prior year financial statements have been reclassified to conform to 1996
presentations.

3. PROPERTY AND EQUIPMENT

Property and equipment, at cost, are summarized as follows (in thousands):

<TABLE>
<CAPTION>
December 31,
------------------------
1995 1996
---------- ----------
<S> <C> <C>
Natural gas and oil properties $ 25,765 $ 37,555
Accumulated depletion (7,227) (9,550)
---------- ----------
18,538 28,005
---------- ----------
Other property and equipment:
3-D seismic interpretation workstations
and software 1,351 1,456
Office furniture and equipment 347 384
Accumulated depreciation (1,014) (1,308)
---------- ----------
684 532
---------- ----------
$ 19,222 $ 28,537
========== ==========
</TABLE>

F3-8
<PAGE> 77
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

On January 30, 1996, the Partnership sold its interest in certain
producing properties for $2.1 million. A gain or loss was not recognized
on this transaction because the Partnership applies the full cost method
of accounting for its investment in natural gas and oil properties.

4. NOTES PAYABLE AND SUBORDINATED NOTES PAYABLE

The notes payable pertain to a revolving credit facility, due 1999,
entered into by the Partnership in April 1996. This facility provides for
borrowings up to $25 million and is secured by the Partnership's natural
gas and oil properties. The Partnership's borrowings under the revolving
credit facility are limited to a borrowing base determined semiannually by
the lender. This determination is based upon the Partnership's proved
natural gas and oil properties.

The amounts outstanding under the revolving credit facility bear interest,
at the borrower's option, at the Base Rate or (i) LIBOR plus 1.75% if the
principal outstanding is less than or equal to 50% of the borrowing base,
(ii) LIBOR plus 2.0% if the principal outstanding is less than or equal to
75% but more than 50% of the borrowing base, and (iii) LIBOR plus 2.25% if
the principal outstanding is greater than 75% of the borrowing base. The
Base Rate is the fluctuating of interest per annum established from time
to time by the lender. The Company also pays a quarterly commitment fee of
0.5% per annum for the unused portion of the borrowing base.

The Company is subject to certain covenants under the terms of the
revolving credit facility. The financial ratios that the Partnership was
required to meet at December 31, 1996 were as follows: (i) the ratio of
current assets to current liabilities must be at least 1.0 to 1.0, and
(ii) the debt service coverage ratio of net cash flow to debt service for
the three months ended December 31, 1996 must be at least 2.25 to 1.0. The
revolving credit facility contains certain other affirmative and negative
covenants, including limitations on additional indebtedness and
restrictions on the payment of dividends. The Partnership is currently in
compliance with all covenants.

The subordinated notes payable bear interest at 5% per annum and are due
in 2002. The notes are convertible into a 19.65% interest in the
Partnership at any time prior to maturity and are unsecured. A
representative of the holders of these notes is a member of the
Partnership's management committee. Interest payments of 3% are due
semi-annually and the remaining 2% is deferred until maturity. As part of
the Exchange (see Note 1), the holders of these notes have agreed to
exchange the notes for shares of the Company's common stock.

5. CAPITAL LEASE OBLIGATIONS

Property under capital leases consists of the following (in thousands):

<TABLE>
<CAPTION>
December 31,
--------------------
1995 1996
-------- --------
<S> <C> <C>
3-D seismic interpretation workstations and software $ 668 $ 525
Office furniture and equipment 58 17
-------- --------
726 542
Accumulated depreciation and amortization (324) (305)
-------- --------
$ 402 $ 237
======== ========
</TABLE>

F3-9

<PAGE> 78
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

The obligations under capital leases are at fixed interest rates ranging
from 11% to 17% and are collateralized by property, plant and equipment.
The future minimum lease payments under the capital leases and the present
value of the net minimum lease payments at December 31, 1996 are as
follows (in thousands):

<TABLE>
<S> <C>
1997 $ 204
1998 105
1999 28
----------
Total minimum lease payments 337
Estimated executory costs included in capital leases (74)
----------
Net minimum lease payments 263
Amounts representing interest (32)
----------
Present value of net minimum lease payments 231
Less: current portion (133)
----------

Noncurrent portion $ 98
==========
</TABLE>

6. COMMITMENTS AND CONTINGENCIES

The Partnership is, from time to time, party to certain lawsuits and
claims arising in the ordinary course of business. While the outcome of
lawsuits and claims cannot be predicted with certainty, management does
not expect these matters to have a materially adverse effect on the
financial condition, results of operations or cash flows of the
Partnership.

The Partnership leases office equipment and space under operating leases
expiring at various dates through 2007. The future minimum annual rental
payments under the noncancelable terms of these leases at December 31,
1996, are as follows (in thousands):

<TABLE>
<S> <C>
1997 $ 526
1998 610
1999 610
2000 543
2001 543
Thereafter 272
----------
$ 3,104
==========
</TABLE>

The Partnership has an option to cancel an office space lease at July 1,
2002. Additional rental payments of $2.6 million will be required for
years 2002 through 2007 if the Partnership does not elect to cancel the
lease.

Rental expense for the years ended December 31, 1994, 1995 and 1996 was
$202,923, $239,715 and $253,112, respectively.

Since the Partnership's major products are commodities, significant
changes in the prices of natural gas and oil could have a significant
impact on the Partnership's results of operations for any particular year.

As of December 31, 1996, there were no known environmental or other
regulatory matters related to the Partnership's operations which are
reasonably expected to result in a material liability to the Partnership.
Compliance with environmental laws and regulations has not had, and is not
expected to have, a material adverse effect on the Partnership's capital
expenditures, earnings or competitive position.

F3-10
<PAGE> 79
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

During 1996, approximately 16%, 12% and 10% of the Partnership's natural
gas and oil production was sold to three separate customers. During 1995,
approximately 14%, 11%, 10%, and 10% of the Partnership's natural gas and
oil production was sold to four separate customers. During 1994,
approximately 15%, 15%, 13%, 13%, and 11% of the Partnership's natural gas
and oil production was sold to five separate customers. However, due to
the availability of other markets, the Partnership does not believe that
the loss of any one of these individual customers would adversely affect
the Partnership's result of operations.

7. FINANCIAL INSTRUMENTS

The Partnership periodically enters into crude oil price swap agreements
which require payments to (or receipts from) counterparties based on the
differential between a fixed price and a variable price for a fixed
quantity of crude oil without the exchange of the underlying crude oil
volumes. The notional amounts of these derivative financial instruments
are based on planned production from existing wells. The Partnership uses
these derivative financial instruments to manage market risks resulting
from fluctuations in crude oil prices. Crude oil price swaps are effective
in minimizing these risks by creating essentially equal and offsetting
market exposures. The derivative financial instruments held by the
Partnership are not leveraged and are held for purposes other than
trading.

At December 31, 1996, the Partnership was a party to crude oil price swap
based on an average notional volume of 7,550 barrels of crude oil per
month and a fixed price of $22.70 per barrel. The contract expires in May
1997. The fair market value of the crude oil price swap at December 31,
1996, based on the market price of crude oil in December 1996, was
$41,902.

The Partnership's non-derivative financial instruments include cash and
cash equivalents, accounts receivable, accounts payable and long-term
debt. The carrying amount of cash and cash equivalents, accounts
receivable and accounts payable approximate fair value because of their
immediate or short maturities. The carrying value of the Partnership's
revolving credit facility (see Note 4) approximates its fair market value
since it bears interest at floating market interest rates. At December 31,
1996, the carrying amount of the Partnership's subordinated notes payable
exceeded the fair market value by $1.9 million, based on current rates
offered to the Partnership for debt of the same remaining maturity.

The Partnership's accounts receivable relate to natural gas and oil sales
to various industry companies, amounts due from industry participants for
expenditures made by the Partnership on their behalf and workstation
revenues. Credit terms, typical of industry standards, are of a short-term
nature and the Partnership does not require collateral. The Partnership's
accounts receivable at December 31, 1996 do not represent significant
credit risks as they are dispersed across many counterparties.
Counterparties to the crude oil price swaps are investment grade financial
institutions. Accordingly, the Partnership does not anticipate any
material effect on its financial position or results of operations as a
result of nonperformance by the third parties on the crude oil price
swaps.

8. EMPLOYEE BENEFIT PLANS

Retirement Savings Plan

During 1996 the Partnership adopted a defined contribution 401(k) plan for
substantially all of its employees. Eligible employees may contribute up
to 15% of their compensation to this plan. The 401(k) plan provides that
the Partnership may, at its discretion, match employee contributions. The
Partnership did not match employee contributions in 1996.

F3-11
<PAGE> 80
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

Stock Compensation

The Board of Directors and stockholders of the Company (see Note 1)
anticipate the adoption of an incentive plan, to be effective upon
completion of the Exchange (see Note 1), which will provide for the
issuance of stock options, stock appreciation rights, stock, restricted
stock, cash or any combination of the foregoing. The objective of this
plan will be to reward key employees whose performance may have a
significant effect on the success of the Company. An aggregate of
1,588,169 shares of the Company's common stock will be reserved for
issuance pursuant to this plan. The Compensation Committee of the Board of
Directors will determine the type of awards made to each participant and
the terms, conditions and limitations applicable to each award.

The Company's Board of Directors also anticipates that it will grant
644,097 stock options prior to the completion of the proposed initial
public offering (see Note 1). These options will be granted under the
incentive plan established as part of the Exchange and will have an
exercise price less than the public offering price. This grant will result
in noncash compensation expense which will be recognized over the
appropriate vesting period.

In 1994 three employees were granted restricted interests in the
Partnership which vest in increments through July 1999. At the date of
grant, the value of these interests was immaterial. On February 26, 1997,
in connection with the Exchange Agreement (see Note 1), the three
employees agreed to transfer, upon the initial filing in early 1997 of a
Registration Statement with the SEC for a public offering of common stock,
these partnership interests to the Company in exchange for 156,250 shares
of restricted common stock of the Company. The terms of the restricted
stock and the restricted partnership interests are substantially the same.
The shares vest over a three-year period ending in 1999. No compensation
expense will result from this exchange.

9. RELATED PARTY TRANSACTIONS

During the years ended December 31, 1994, 1995 and 1996, the Partnership
paid approximately $310,000, $382,000 and $596,000, respectively, in fees
for land acquisition services performed by a company owned by a brother
of the Partnership's President and Chief Executive Officer. Other
participants in the Partnership's 3-D seismic projects reimburse the
partnership for most of these amounts.

The Partnership also participates in various industry projects with
affiliates of the holder of the subordinated notes payable (see Note 4).
During 1995 and 1996, the Partnership received approximately $25,000
and $123,000, respectively, for workstation time and geoscientists' time
spent interpreting 3-D seismic data and workstation use. In addition, the
Partnership sold to an affiliate of the holders of the subordinated notes
payable an interest in (i) a 3-D project for approximately $525,000 in
1994, (ii) a 3-D project for approximately $75,000 in 1995 and (iii) two
3-D delineated potential drilling locations and 3-D seismic data for
approximately $83,000 in 1996.

In 1995 and 1996, the Partnership paid $35,000 and $110,000 for working
interests in natural gas and oil properties owned by affiliates of a
member of the Partnership's management committee. The Partnership billed
the affiliates $201,000, $13,000 and $68,000 in 1994, 1995 and 1996,
respectively, for their proportionate share of the costs related to this
project.

A limited partner and member of the Partnership's management committee
served as a consultant to the Partnership on various aspects of the
Partnership's business and strategic issues. Fees paid for these services
by the Partnership were $72,000 for each of the twelve month periods ended
December 31, 1994 and 1995 and $79,200 for the twelve month period ended
December 31, 1996.

10. NATURAL GAS AND OIL EXPLORATION AND PRODUCTION ACTIVITIES

The tables presented below provide supplemental information about natural
gas and oil exploration and production activities as defined by SFAS No.
69, "Disclosures about Oil and Gas Producing Activities."

F3-12
<PAGE> 81
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

Results of Operations for Natural Gas and Oil Producing Activities (in
thousands)

<TABLE>
<CAPTION>
Year ended December 31,
------------------------------------
1994 1995 1996
---------- ---------- ----------
<S> <C> <C> <C>
Natural gas and oil sales $ 2,565 $ 3,578 $ 6,141

Costs and expenses:
Lease operating 491 761 726
Production taxes 126 165 362
Depletion of natural gas and
oil properties 1,104 1,626 2,323
---------- ---------- ----------
Total costs and expenses 1,721 2,552 3,411
---------- ---------- ----------
$ 844 $ 1,026 $ 2,730
========== ========== ==========

Depletion per physical unit of production
(equivalent Mcf of gas) $ 1.10 $ 1.22 $ 1.13
========== ========== ==========
</TABLE>

Natural gas and oil sales reflect the market prices of net production sold
or transferred, with appropriate adjustments for royalties, net profits
interest and other contractual provisions. Lease operating expenses
include lifting costs incurred to operate and maintain productive wells
and related equipment, including such costs as operating labor, repairs
and maintenance, materials, supplies and fuel consumed. Production taxes
include production and severance taxes. No provision has been made for
income taxes since these taxes are the responsibility of the partners (see
Note 2). Depletion of natural gas and oil properties relates to
capitalized costs incurred in acquisition, exploration and development
activities. Results of operations do not include interest expense and
general corporate amounts.

Costs Incurred and Capitalized Costs

The costs incurred in natural gas and oil acquisition, exploration and
development activities follow (in thousands):

<TABLE>
<CAPTION>
December 31,
------------------------
1995 1996
---------- ----------
<S> <C> <C>
Costs incurred for the year:
Exploration $ 6,893 $ 10,527
Property acquisition 1,885 6,195
Development 713 1,328
Proceeds from participants (1,296) (4,111)
---------- ----------
$ 8,195 $ 13,939
========== ==========
</TABLE>

Costs incurred represent amounts incurred by the Partnership for
exploration, property acquisition and development activities.
Periodically, the Partnership will receive proceeds from participants
subsequent to project initiation for an assignment of an interest in the
project. These payments are represented by proceeds from participants.

F3-13
<PAGE> 82
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

Capitalized costs related to natural gas and oil acquisition, exploration
and development activities follow (in thousands):

<TABLE>
<CAPTION>
December 31,
------------------------
1995 1996
---------- ----------
<S> <C> <C>
Cost of natural gas and oil properties at year-end:
Proved $ 22,305 $ 30,487
Unproved 3,460 7,068
---------- ----------
Total capitalized costs 25,765 37,555
Accumulated depletion (7,227) (9,550)
---------- ----------
$ 18,538 $ 28,005
========== ==========
</TABLE>

Following is a summary of costs (in thousands) excluded from depletion at
December 31, 1996, by year incurred. At this time, the Partnership is
unable to predict either the timing of the inclusion of these costs and
the related natural gas and oil reserves in its depletion computation or
their potential future impact on depletion rates.

<TABLE>
<CAPTION>
Year ended December 31,
------------------------------------
Prior years 1994 1995 1996 Total
----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Property
acquisition $ 1,418 $ 434 $ 694 $ 2,515 $ 5,061
Exploration 480 51 234 1,242 2,007
---------- ---------- ---------- ---------- ----------
Total $ 1,898 $ 485 $ 928 $ 3,757 $ 7,068
========== ========== ========== ========== ==========
</TABLE>

11. NATURAL GAS AND OIL RESERVES AND RELATED FINANCIAL DATA (UNAUDITED)

Information with respect to the Partnership's natural gas and oil
producing activities is presented in the following tables. Reserve
quantities as well as certain information regarding future production and
discounted cash flows were determined by the Partnership's independent
petroleum consultants and internal petroleum reservoir engineer.

Natural Gas and Oil Reserve Data

The following tables present the Partnership's estimates of its proved
natural gas and oil reserves. The Partnership emphasizes that reserve
estimates are approximates and are expected to change as additional
information becomes available. Reservoir engineering is a subjective
process of estimating underground accumulations of natural gas and oil
that cannot be measured in an exact way, and the accuracy of any reserve
estimate is a function of the quality of available data and of engineering
and geological interpretation and judgment. Accordingly, there can be no
assurance that the reserves set forth herein will ultimately be produced
nor can there be assurance that the proved undeveloped reserves will be
developed within the periods anticipated. A substantial portion of the
reserve balances were estimated utilizing the volumetric method, as
opposed to the production performance method.

F3-14
<PAGE> 83
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
Natural Gas Oil
(MMcf) (MBbls)
---------- ----------
<S> <C> <C>
Proved reserves at December 31, 1993 227 336
Revisions to previous estimates 102 (26)
Extensions, discoveries and other additions 3,415 852
Production (165) (140)
---------- ----------

Proved reserves at December 31, 1994 3,579 1,022
Revisions to previous estimates (1,600) (214)
Extensions and discoveries 2,555 1,055
Sales of minerals-in-place (6) (14)
Production (271) (177)
---------- ----------

Proved reserves at December 31, 1995 4,257 1,672
Revisions of previous estimates (1,005) (232)
Extensions, discoveries and other additions 7,742 996
Purchase of minerals-in-place 260 3
Sales of minerals-in-place (299) (272)
Production (698) (227)
---------- ----------

Proved reserves at December 31, 1996 10,257 1,940
========== ==========

Proved developed reserves at December 31:
1994 1,849 915
1995 3,819 1,274
1996 6,034 1,453
</TABLE>

Proved reserves are estimated quantities of crude natural gas and oil
which geological and engineering data indicate with reasonable certainty
to be recoverable in future years from known reservoirs under existing
economic and operating conditions. Proved developed reserves are proved
reserves which can be expected to be recovered through existing wells with
existing equipment and operating methods.

Standardized Measure of Discounted Future Net Cash Inflows and Changes
Therein

The following table presents a standardized measure of discounted future
net cash inflows (in thousands) relating to proved natural gas and oil
reserves. Future cash flows were computed by applying year end prices of
natural gas and oil relating to the Partnership's proved reserves to the
estimated year-end quantities of those reserves. Future price changes were
considered only to the extent provided by contractual agreements in
existence at year-end. Future production and development costs were
computed by estimating those expenditures expected to occur in developing
and producing the proved natural gas and oil reserves at the end of the
year, based on year-end costs. Actual future cash inflows may vary
considerably and the standardized measure does not necessarily represent
the fair value of the Partnership's natural gas and oil reserves.

F3-15
<PAGE> 84
BRIGHAM OIL & GAS, L.P.

NOTES TO THE FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
December 31,
--------------------------------
1994 1995 1996
-------- -------- --------
<S> <C> <C> <C>
Future cash inflows $ 22,544 $ 38,333 $ 84,987
Future development and production costs (8,148) (12,543) (20,998)
-------- -------- --------

Future net cash inflows $ 14,396 $ 25,790 $ 63,989
======== ======== ========

Standardized measure of future net cash
inflows discounted at 10% per annum $ 10,240 $ 18,222 $ 44,506(1)
======== ======== ========
</TABLE>

(1) The earnings of the Partnership are not subject to income taxes as the
Partnership is a non-taxpaying entity (see Note 1). Once the
Partnership consummates the proposed Exchange (see Note 1), the
successor entity will be a taxable corporation. The estimated pro
forma income taxes, discounted at 10%, are approximately $12,146,000
as of December 31, 1996, resulting in pro forma discounted net cash
flows of approximately $32,360,000 as of December 31, 1996.

The average natural gas and oil prices used to calculate the future net cash
inflows at December 31, 1996 were $24.66 per barrel and $3.62 per Mcf,
respectively. At December 31, 1996 and February 14, 1997, respectively, the
NYMEX price for oil was $25.92 per barrel and $22.41 per barrel and the NYMEX
price for natural gas was $2.76 per MMBtu and $1.97 per MMBtu.

Changes in the future net cash inflows (in thousands) discounted at 10% per
annum follow:

<TABLE>
<CAPTION>
December 31,
--------------------------------------
1994 1995 1996
---------- ---------- ----------
<S> <C> <C> <C>
Beginning of period $ 3,158 $ 10,240 $ 18,222
Sales of natural gas and oil produced,
net of production costs (1,948) (2,652) (5,053)
Development costs incurred 69 169 246
Extensions and discoveries 9,124 11,669 29,457
Purchases of minerals-in-place -- -- 384
Sales of minerals-in-place -- (198) (2,380)
Net change in prices and
production costs 139 1,394 7,023
Change in future development costs (619) 419 303
Changes in production rates and other 36 (364) (342)
Revisions of quantity estimates (130) (3,479) (5,176)
Accretion of discount 411 1,024 1,822
---------- ---------- ----------
End of period $ 10,240 $ 18,222 $ 44,506
========== ========== ==========
</TABLE>

F3-16
<PAGE> 85

APPENDIX A

February 14, 1997

Mr. Jon L. Glass
Brigham Oil & Gas, L.P.
5949 Sherry Lane, Suite 1616
Dallas, Texas 75225

Re: Evaluation
BRIGHAM OIL & GAS, L.P. INTERESTS
Proved Reserves
As of December 31, 1996

Pursuant to the Guidelines of the Securities and
Exchange Commission for Reporting Partnership
Reserves and Future Net Revenue

Dear Mr. Glass:

As requested, we are submitting our estimated proven reserves and future
net cash flows, as of December 31, 1996, attributable to the interests of
Brigham Oil & Gas, L.P. in certain oil and natural gas properties. The evaluated
properties are located in various counties in Kansas, New Mexico, Oklahoma and
Texas. This report was prepared using constant prices and costs and conforms to
the guidelines of the Securities and Exchange Commission (SEC).

Composite forecasts for the total proved, proved developed producing,
proved developed non-producing and proved undeveloped estimates are presented by
category in the accompanying Tables I-P, I-PDP, I-PDNP and I-PUD, respectively.
The estimated net proved reserves and future net cash flow for all three
categories are summarized as follows:

<TABLE>
<CAPTION>
NET RESERVES FUTURE NET CASH FLOW
-------------------------------------- -------------------------------------
OIL GAS PRESENT WORTH
CATEGORY (BARRELS) (MCF) TOTAL AT 10%
-------- ---------------- ------------------ -------------------- -------------
<S> <C> <C> <C> <C>
Proved Developed:
Producing...................... 1,293,456 4,880,441 $38,532,070 $28,543,340
Non-Producing.................. 159,238 1,153,825 5,649,492 2,395,028
Proved Undeveloped............. 487,216 4,222,257 19,806,950 13,567,850
--------- ---------- ----------- -----------
Total Proved........... 1,939,911 10,256,520 $63,988,510 $44,506,220
========= ========== =========== ===========
</TABLE>

Future revenue is prior to deducting state production taxes and ad valorem
taxes. Future net cash flow is after deducting these taxes, future capital costs
and operating expenses, but before consideration of federal income taxes. In
accordance with SEC guidelines, the future net cash flow has been discounted at
an annual rate of ten percent to determine its "present worth". The present
worth is shown to indicate the effort of time on the value of money and should
not be construed as being the fair market value of the properties.

The oil reserves include oil and condensate. Oil volumes are expressed in
barrels (42 U.S. gallons). Gas volumes are expressed in thousands of standard
cubic feet (Mcf) at contract temperature and pressure base.

Our estimates are for proved reserves only and do not include any probable
or possible reserves nor have any values been attributed to interests in acreage
beyond the location for which undeveloped reserves have been estimated.

Oil and gas prices being received at December 31, 1996 were utilized as
furnished. Direct lease operating expenses are based on historical data for 1995
and 1996 and do not include general and administrative

A-1
<PAGE> 86

overhead. Investments are capital costs for pumping unit installations,
work-overs and drilling costs and were utilized as furnished. All economic
factors were held constant in accordance with SEC guidelines.

An on-site field inspection of the properties has not been performed nor
have the mechanical operation or condition of the wells and their related
facilities been examined nor have the wells been tested by Cawley, Gillespie &
Associates, Inc. Possible environmental liability related to the properties has
not been investigated nor considered. The cost of plugging and the salvage value
of equipment at abandonment have not been included.

The reserve classifications and the economic considerations used herein
conform to the criteria of the Securities and Exchange Commission. The reserves
and economics are predicated on regulatory agency classifications, rules,
policies, laws, taxes and royalties currently in effect except as noted herein.
The possible effects of changes in legislation or other Federal or State
restrictive actions which could affect the reserves and economics have not been
considered.

The proved reserve estimates and economic forecasts were based upon
interpretations of data furnished by your office and available from our files.
All estimates represent our best judgment based on the data available at the
time of preparation. It should be realized that the reserve estimates, the
reserves actually recovered, the revenue derived therefrom and the actual costs
incurred could be more or less than the estimated amounts. Additionally, the
prices and costs may vary from those utilized which may increase or decrease
both the estimated proved reserve volumes and future net revenues therefrom.

Ownership interests in the oil and natural gas properties were accepted as
furnished by Brigham Oil & Gas, L.P., and has not been independently confirmed.
We are independent registered professional engineers and geologists. We do not
own an interest in the properties of Brigham Oil & Gas, L.P. and are not
employed on a contingent basis. Our workpapers and related data utilized in the
preparation of these estimates are available in our office.

Yours very truly,

Cawley, Gillespie & Associates, Inc.

/s/ AARON CAWLEY
-------------------------------------------
Aaron Cawley, P.E.
Executive Vice President

A-2
<PAGE> 87

================================================================================

NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY OF THE UNDERWRITERS. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF ANY OFFER TO BUY ANY
SECURITIES OTHER THAN THE SHARES OF COMMON STOCK OFFERED BY THIS PROSPECTUS, NOR
DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY THE
SHARES OF COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE HEREOF.

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

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary........................ 3
Risk Factors.............................. 11
The Company............................... 17
Use of Proceeds........................... 17
Dividend Policy........................... 17
Dilution.................................. 18
Capitalization............................ 19
Selected Financial Data................... 20
Management's Discussion and Analysis of
Financial Condition and Results of
Operations.............................. 22
Business and Properties................... 28
Management................................ 43
Certain Transactions...................... 48
Principal and Selling Stockholders........ 50
Description of Capital Stock.............. 51
Shares Eligible for Future Sale........... 53
Underwriting.............................. 54
Legal Matters............................. 55
Experts................................... 55
Available Information..................... 55
Glossary of Certain Oil and Gas Terms..... 57
Index to Financial Statements............. F-1
Letter of Cawley, Gillespie & Associates,
Inc..................................... A-1
</TABLE>

UNTIL , 1997 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL DEALERS
EFFECTING TRANSACTIONS IN THE SHARES OF THE COMMON STOCK, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN
ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS.

================================================================================

BRIGHAM LOGO

BRIGHAM EXPLORATION COMPANY

COMMON STOCK

--------------------
PROSPECTUS
--------------------

BEAR, STEARNS & CO. INC.
HOWARD, WEIL, LABOUISSE, FRIEDRICHS
INCORPORATED
PETRIE PARKMAN & CO.

, 1997

================================================================================

<PAGE> 88

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The estimated expenses payable by Brigham Exploration Company (the
"Registrant" or the "Company") in connection with the registration of the
securities offered hereby, other than underwriting discounts and commissions,
are as follows:

<TABLE>
<S> <C>
SEC Registration Fee........................................ $16,553
NASD Filing Fee............................................. 5,963
Nasdaq National Market Listing Fee.......................... *
Blue Sky Qualification Fees and Expenses.................... 5,000
Accounting Fees and Expenses................................ *
Legal Fees and Expenses..................................... *
Engineering Fees and Expenses............................... *
Transfer Agent and Registrar Fees........................... *
Printing and Engraving Expenses............................. *
Miscellaneous............................................... *
-------
Total............................................. $ *
=======
</TABLE>

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

* To be provided by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Under Section 145 of the DGCL, the Registrant has the power to indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding (other than an
action by or in the right of the corporation) by reason of the fact that the
person is or was a director, officer, employee or agent of any corporation,
partnership, joint venture, trust or other enterprise, against any and all
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement and reasonably incurred in connection with such action, suit or
proceeding. The power to indemnify applies only if the person acted in good
faith and in a manner the person reasonably believed to be in or not opposed to
the best interests of the corporation, and with respect to any criminal action
or proceeding, had no reasonable cause to believe the person's conduct was
unlawful.

In the case of an action by or in the right of the Registrant, no
indemnification may be made with respect to any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Registrant unless
and only to the extent that the court of chancery or the court in which such
action or suit was brought shall determine that despite the adjudication of
liability such person is fairly and reasonably entitled to indemnity for such
expenses which the court shall deem proper. Section 145 of the DGCL further
provides that to the extent a director or officer of the Registrant has been
successful in the defense of any action, suit or proceeding referred to above or
in the defense of any claim, issue or matter therein, that person shall be
indemnified against expenses (including attorney's fees) actually and reasonably
incurred in connection therewith.

II-1
<PAGE> 89

The Registrant also has the power to purchase and maintain insurance on
behalf of any person covering any liability incurred in that person's capacity
as a director, officer, employee or agent of the corporation, or arising out of
that person's status as such, whether or not the corporation would have the
power to indemnify against the liability.

The Certificate of Incorporation and Bylaws provide that the Registrant
will indemnify its officers and directors and former officers and directors
against any expenses, judgments or settlement payments sustained or paid by such
persons as a result of having acted as an officer or director of the Registrant,
or, at the request of the Registrant, as an officer, director, agent or employee
of another business entity. The Certificate of Incorporation and Bylaws further
provide that the Registrant may, by action of its Board of Directors, provide
indemnification to employees and agents of the Registrant, individually or as a
group, with the same scope and effect as the indemnification of directors and
officers.

The form of Indemnity Agreement contained in Exhibit 10.28 provides for the
indemnification in certain instances against liability and expenses incurred in
connection with proceedings brought by or in the right of the Company or by
third parties by reason of a person serving as an officer or director of the
Company.

The form of Underwriting Agreement contained in Exhibit 1 provides for
indemnification of the directors and officers signing the Registration Statement
and certain controlling persons of the Company against certain liabilities
(including certain liabilities under the Securities Act of 1933, (the
"Securities Act")) in certain instances by the Underwriters.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

The following information relates to all securities issued or sold by the
Registrant since inception and not registered under the Securities Act.

Unless otherwise specifically provided, each of the transactions described
below was conducted in reliance upon the exemption from registration provided in
Section 4(2) of the Securities Act and the rules and regulations promulgated
thereunder. Furthermore, each of the certificates representing the Registrant's
securities issued in connection with such transactions contains a restrictive
legend, as appropriate, requiring each person acquiring such securities from the
Registrant to furnish investment representations to the Registrant and stating
that no underwriters participated in such transactions.

The Registrant was formed on February 25, 1997. Pursuant to the terms of an
Agreement and Plan of Reorganization dated February 27, 1997 (the "Exchange
Agreement") the Company became the holding company for Brigham Oil & Gas, L.P.,
which will conduct the Registrant's operations and was formed in May 1992 (the
"Partnership"). Pursuant to the terms of the Exchange Agreement, the limited
partners of the Partnership received 634,868 shares of the Registrant's common
stock. In addition, the general partners or their stockholders received
6,539,239 shares of the Registrant's common stock for each share of common stock
of the general partner owned by such stockholder. Each certificate issued in
connection with such exchange contained an appropriate restrictive legend.

In August 1995, the Registrant issued $16 million principal amount of its
5% convertible subordinated notes (the "Notes") to Resource Investment
Management Company. Immediately after the consummation of the exchange described
above, RIMCO converted the Notes into 1,759,464 shares of the Registrant's
common stock. Each certificate issued in connection with that conversion
contained an appropriate restrictive legend.

The Registrant and its predecessor have granted options to purchase an
aggregate of 644,097 shares of Common Stock and issued 347,221 shares of
restricted stock to officers and key employees.

II-2
<PAGE> 90

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibits:

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
1+ -- Form of Underwriting Agreement.
2.1 -- Exchange Agreement.
3.1 -- Certificate of Incorporation.
3.2 -- Bylaws.
4.1+ -- Form of Common Stock Certificate.
5+ -- Opinion of Thompson & Knight, A Professional Corporation.
10.1 -- Agreement of Limited Partnership, dated May 1, 1992,
between Brigham Exploration Company and General Atlantic
Partners III, L.P. as general partners, and Harold D.
Carter and GAP-Brigham Partners, L.P. as limited
partners.
10.1.1 -- Amendment No. 1 to Agreement of Limited Partnership of
Brigham Oil & Gas, L.P., dated May 1, 1992, by and among
Brigham Exploration Company, General Atlantic Partners
III, L.P., GAP-Brigham Partners, L.P. and Harold D.
Carter.
10.1.2 -- Amendment No. 2 to Agreement of Limited Partnership of
Brigham Oil & Gas, L.P., dated September 30, 1994, by and
among Brigham Exploration Company, General Atlantic
Partners III, L.P., GAP-Brigham Partners, L.P., Harold D.
Carter and the additional signatories thereto.
10.1.3 -- Amendment No. 3 to Agreement of Limited Partnership of
Brigham Oil & Gas, L.P., dated August 24, 1995, by and
among Brigham Exploration Company, General Atlantic
Partners III, L.P., GAP-Brigham Partners, L.P., Harold D.
Carter, Craig M. Fleming, David T. Brigham and Jon L.
Glass.
10.2 -- Agreement of Limited Partnership of Venture Acquisitions,
L.P., dated September 23, 1994, by and between Quest
Resources, L.L.C. and RIMCO Energy, Inc. as general
partners, and RIMCO Production Company, Inc., RIMCO
Exploration Partners, L.P. I and RIMCO Exploration
Partners, L.P. II, as limited partners.
10.3 -- Regulations of Quest Resources, L.L.C.
10.4 -- Management and Ownership Agreement, dated September 23,
1994, by and among Brigham Oil & Gas, L.P., Brigham
Exploration Company, General Atlantic Partners III, L.P.,
Harold D. Carter, Ben M. Brigham and GAP-Brigham
Partners, L.P.
10.5* -- Employment Agreement, dated May 1, 1992, by and between
Brigham Oil & Gas, L.P. and Ben M. Brigham.
10.6* -- Consulting Agreement, dated May 2, 1995, by and between
Brigham Oil & Gas, L.P. and Harold D. Carter.
10.7* -- Employment Agreement, by and between Brigham Exploration
Company and Ben M. Brigham.
10.8*+ -- Form of Confidentiality and Noncompete Agreement between
the Registrant and each of its executive officers.
10.9*+ -- 1997 Incentive Plan of Brigham Exploration Company
10.9.1*+ -- Form of Option Agreement.
10.10* -- Incentive Bonus Plan dated as of February 28, 1997 of
Brigham, Inc. and Brigham Oil & Gas, L.P.
</TABLE>

II-3
<PAGE> 91
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
10.11 -- Note Purchase Agreement, dated August 24, 1995, by and
among Brigham Oil & Gas, L.P., RIMCO Partners, L.P. II,
RIMCO Partners, L.P. III and RIMCO Partners, L.P.
10.11.1 -- 5% Convertible Note Due September 1, 2002, dated August
24, 1995, executed by Brigham Oil & Gas, L.P. in favor of
RIMCO Partners, L.P. II in the principal sum of
$5,584,000.
10.11.2 -- 5% Convertible Subordinated Note Due September 1, 2002,
dated August 24, 1995, executed by Brigham Oil & Gas,
L.P. in favor of RIMCO Partners, L.P. III in the
principal sum of $2,800,000.
10.11.3 -- 5% Convertible Subordinated Note Due September 1, 2002,
dated August 24, 1995, executed by Brigham Oil & Gas,
L.P. in favor of RIMCO Partners, L.P. IV in the principal
sum of $7,616,000.
10.12 -- Loan Agreement, dated April 1, 1996, by and between
Brigham Oil & Gas, L.P. and Bank One, Texas, N.A.
10.12.1 -- Revolving Note, dated April 1, 1996, executed by Brigham
Oil & Gas, L.P., in favor of Bank One, Texas, N.A. in the
principle amount of $25,000,000.
10.12.2 -- Form of Mortgage, Security Agreement, Assignment of
Production and Financing Statement for New Mexico, dated
as of April 1, 1996, by Brigham Oil & Gas, L.P. and Bank
One, Texas, N.A.
10.12.3 -- Form of Mortgage, Security Agreement, Assignment of
Production and Financing Statement for Oklahoma, dated as
of April 1, 1996, by Brigham Oil & Gas, L.P. and Bank
One, Texas, N.A.
10.12.4 -- Form of Deed of Trust, Security Agreement, Assignment of
Production and Financing Statement for Texas, dated as of
April 1, 1996, by Brigham Oil & Gas, L.P. and Bank One,
Texas, N.A.
10.13 -- Office Lease, dated May 17, 1993, by and between Sterling
Plaza Ltd. and Brigham Oil & Gas, L.P.
10.13.1 -- First Amendment to Office Lease, dated April 8, 1994, by
and between ZML-Sterling Plaza Limited Partnership by its
agent, Equity Office Properties, Inc., and Brigham Oil &
Gas, L.P.
10.13.2 -- Second Amendment to Office Lease, dated June 29, 1994, by
and between ZML-Sterling Plaza Limited Partnership by its
agent, Equity Office Properties, Inc., and Brigham Oil &
Gas, L.P.
10.13.3 -- Third Amendment to Office Lease, dated December 30, 1996,
by and between ZML-Sterling Plaza Limited Partnership by
its agent, Equity Office Holdings, L.L.C., and Brigham
Oil & Gas, L.P.
10.13.4 -- Modification and Ratification of Lease, dated April 1,
1993.
10.13.5 -- Modification and Ratification of Lease, dated May 12,
1993.
10.14 -- Two Bridgepoint Lease Agreement, dated September 30,
1996, by and between Investors Life Insurance Company of
North America and Brigham Oil & Gas, L.P.
10.15 -- Anadarko Basin Seismic Operations Agreement, dated
February 15, 1996, by and between Brigham Oil & Gas, L.P.
and Veritas Geophysical, Ltd.
10.15.1 -- Letter Amendment to Anadarko Basin Seismic Operations
Agreement, dated June 10, 1996, between Brigham Oil &
Gas, L.P. and Veritas Geophysical, Ltd.
10.16 -- Expense Allocation and Participation Agreement, dated
April 1, 1996, between Brigham Oil & Gas, L.P. and Gasco
Limited Partnership.
</TABLE>

II-4
<PAGE> 92
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
10.16.1 -- Amendment to Expense Allocation and Participation
Agreement, dated October 21, 1996, between Brigham Oil &
Gas, L.P. and Gasco Limited Partnership.
10.17 -- Expense Allocation and Participation Agreement, dated
April 1, 1996, between Brigham Oil & Gas, L.P. and Middle
Bay Oil Company, Inc.
10.17.1 -- Amendment to Expense Allocation and Participation
Agreement, dated September 26, 1996, between Brigham Oil
& Gas, L.P. and Middle Bay Oil Company, Inc.
10.17.2 -- Letter Amendment to Expense Allocation and Participation
Agreement, dated May 20, 1996, between Brigham Oil & Gas,
L.P. and Middle Bay Oil Company, Inc.
10.18 -- Anadarko Basin Joint Participation Agreement, dated May
1, 1996, by and among Stephens Production Company and
Brigham Oil & Gas, L.P.
10.19 -- Anadarko Basin Joint Participation Agreement, dated May
1, 1996, by and between Vintage Petroleum, Inc. and
Brigham Oil & Gas, L.P.
10.20 -- Processing Alliance Agreement, dated July 20, 1993,
between Veritas Seismic Ltd. and Brigham Oil & Gas, L.P.
10.20.1 -- Letter Amendment to Processing Alliance Agreement, dated
November 3, 1994, between Veritas Seismic Ltd. and
Brigham Oil & Gas, L.P.
10.21 -- Agreement and Assignment of Interest, West Bradley
Project, dated September 1, 1995, by and between Aspect
Resources Limited Liability Company and Brigham Oil &
Gas, L.P.
10.22 -- Agreement and Assignment of Interests in lands located in
Grady County, Oklahoma, West Bradley Project, dated
December 1, 1995, by and between Aspect Resources Limited
Liability Company, Brigham Oil & Gas, L.P. and Venture
Acquisitions, L.P.
10.23 -- Agreement and Assignment of Interests, West Bradley
Project, dated December 1, 1995, by and between Aspect
Resources Limited Liability Company and Brigham Oil &
Gas, L.P.
10.24 -- Geophysical Exploration Agreement, Hardeman Project,
Hardeman and Wilbarger Counties, Texas and Jackson
County, Oklahoma, dated March 15, 1993 by and among
General Atlantic Resources, Inc., Maynard Oil Company,
Ruja Muta Corporation, Tucker Scully Interests Ltd., JHJ
Exploration, Ltd., Cheyenne Petroleum Company, Antrim
Resources, Inc., and Brigham Oil & Gas, L.P.
10.25 -- Agreement and Partial Assignment of Interests in OK13-P
Prospect Area, Jackson County, Oklahoma (Hardeman
Project), dated August 1, 1995, by and between Brigham
Oil & Gas, L.P. and Aspect Resources Limited Liability
Company.
10.26 -- Agreement and Partial Assignment of Interests in Q140-E
Prospect Area, Hardeman County, Texas (Hardeman Project),
dated August 1, 1995, by and between Brigham Oil & Gas,
L.P. and Aspect Resources Limited Liability Company.
10.27 -- Agreement and Partial Assignment of Interests in Hankins
#1 Chappel Prospect Agreement, Jackson County, Oklahoma
(Hardeman Project), dated March 21, 1996, by and between
Brigham Oil & Gas, L.P., NGR, Ltd. and Aspect Resources
Limited Liability Company.
10.28+ -- Form of Indemnity Agreement between the Registrant and
each of its executive officers.
</TABLE>

II-5
<PAGE> 93
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
21+ -- Subsidiaries of the Registrant.
23.1+ -- Consent of Thompson & Knight, A Professional Corporation
(included in Exhibit 5 above).
23.2 -- Consent of Price Waterhouse LLP, independent public
accountants.
23.3 -- Consent of Cawley, Gillespie & Associates, Inc.,
independent petroleum engineers.
24.1 -- Powers of Attorney (included on the first signature page
to this Registration Statement).
27 -- Financial Data Schedule.
</TABLE>

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

+ To be filed by amendment.

* Management contract or compensatory plan.

(b) Financial Statement Schedules: None.

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing specified in the Underwriting Agreements, certificates in such
denominations and registered in such names as required by the particular
Underwriter, to permit prompt delivery to each purchaser.

The undersigned Registrant also hereby undertakes that:

(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
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 Securities 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 Securities Act and will be governed by the final
adjudication of such issue.

II-6
<PAGE> 94

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Brigham
Exploration Company has duly caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in Dallas, Texas, on
February 27, 1997.
BRIGHAM EXPLORATION COMPANY

By: /s/ BEN M. BRIGHAM
----------------------------------
Ben M. Brigham
President, Chief Executive Officer
and
Chairman of the Board

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned directors and officers
of Brigham Exploration Company, a Delaware corporation, which is filing a
Registration Statement on Form S-1 with the Securities and Exchange Commission,
Washington, D.C. 20549 under the provisions of the Securities Act of 1933, as
amended (the "Securities Act"), hereby constitute and appoint Ben M. Brigham and
Anne L. Brigham, and each of them, the individual's true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for the person and in his or her name, place and stead, in any
and all capacities, to sign such Registration Statement and any or all
amendments, including post-effective amendments, to the Registration Statement,
including a Prospectus or an amended Prospectus therein and any registration
statement for the same offering that is to be effective upon filing pursuant to
Rule 462(b) under the Securities Act, and all other documents in connection
therewith to be filed with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact as agents or any of them, or their 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 indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>

/s/ BEN M. BRIGHAM President, Chief Executive February 27, 1997
- ----------------------------------------------------- Officer and Chairman of the
Ben M. Brigham Board (principal executive
officer)

/s/ ANNE L. BRIGHAM Executive Vice President and February 27, 1997
- ----------------------------------------------------- Director
Anne L. Brigham

/s/ CRAIG M. FLEMING Chief Financial Officer February 27, 1997
- ----------------------------------------------------- (principal financial and
Craig M. Fleming accounting officer)

/s/ JON L. GLASS Vice President -- Exploration February 27, 1997
- ----------------------------------------------------- and Director
Jon L. Glass

/s/ HAROLD D. CARTER Consultant and Director February 27, 1997
- -----------------------------------------------------
Harold D. Carter

/s/ GARY J. MILAVEC Director February 27, 1997
- -----------------------------------------------------
Gary J. Milavec

/s/ ALEXIS M. CRANBERG Director February 27, 1997
- -----------------------------------------------------
Alexis M. Cranberg

/s/ STEPHEN P. REYNOLDS Director February 27, 1997
- -----------------------------------------------------
Stephen P. Reynolds
</TABLE>

II-7
<PAGE> 95
EXHIBIT INDEX

<PAGE> 96
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
10.11 -- Note Purchase Agreement, dated August 24, 1995, by and
among Brigham Oil & Gas, L.P., RIMCO Partners, L.P. II,
RIMCO Partners, L.P. III and RIMCO Partners, L.P.
10.11.1 -- 5% Convertible Note Due September 1, 2002, dated August
24, 1995, executed by Brigham Oil & Gas, L.P. in favor of
RIMCO Partners, L.P. II in the principal sum of
$5,584,000.
10.11.2 -- 5% Convertible Subordinated Note Due September 1, 2002,
dated August 24, 1995, executed by Brigham Oil & Gas,
L.P. in favor of RIMCO Partners, L.P. III in the
principal sum of $2,800,000.
10.11.3 -- 5% Convertible Subordinated Note Due September 1, 2002,
dated August 24, 1995, executed by Brigham Oil & Gas,
L.P. in favor of RIMCO Partners, L.P. IV in the principal
sum of $7,616,000.
10.12 -- Loan Agreement, dated April 1, 1996, by and between
Brigham Oil & Gas, L.P. and Bank One, Texas, N.A.
10.12.1 -- Revolving Note, dated April 1, 1996, executed by Brigham
Oil & Gas, L.P., in favor of Bank One, Texas, N.A. in the
principle amount of $25,000,000.
10.12.2 -- Form of Mortgage, Security Agreement, Assignment of
Production and Financing Statement for New Mexico, dated
as of April 1, 1996, by Brigham Oil & Gas, L.P. and Bank
One, Texas, N.A.
10.12.3 -- Form of Mortgage, Security Agreement, Assignment of
Production and Financing Statement for Oklahoma, dated as
of April 1, 1996, by Brigham Oil & Gas, L.P. and Bank
One, Texas, N.A.
10.12.4 -- Form of Deed of Trust, Security Agreement, Assignment of
Production and Financing Statement for Texas, dated as of
April 1, 1996, by Brigham Oil & Gas, L.P. and Bank One,
Texas, N.A.
10.13 -- Office Lease, dated May 17, 1993, by and between Sterling
Plaza Ltd. and Brigham Oil & Gas, L.P.
10.13.1 -- First Amendment to Office Lease, dated April 8, 1994, by
and between ZML-Sterling Plaza Limited Partnership by its
agent, Equity Office Properties, Inc., and Brigham Oil &
Gas, L.P.
10.13.2 -- Second Amendment to Office Lease, dated June 29, 1994, by
and between ZML-Sterling Plaza Limited Partnership by its
agent, Equity Office Properties, Inc., and Brigham Oil &
Gas, L.P.
10.13.3 -- Third Amendment to Office Lease, dated December 30, 1996,
by and between ZML-Sterling Plaza Limited Partnership by
its agent, Equity Office Holdings, L.L.C., and Brigham
Oil & Gas, L.P.
10.13.4 -- Modification and Ratification of Lease, dated April 1,
1993.
10.13.5 -- Modification and Ratification of Lease, dated May 12,
1993.
10.14 -- Two Bridgepoint Lease Agreement, dated September 30,
1996, by and between Investors Life Insurance Company of
North America and Brigham Oil & Gas, L.P.
10.15 -- Anadarko Basin Seismic Operations Agreement, dated
February 15, 1996, by and between Brigham Oil & Gas, L.P.
and Veritas Geophysical, Ltd.
10.15.1 -- Letter Amendment to Anadarko Basin Seismic Operations
Agreement, dated June 10, 1996, between Brigham Oil &
Gas, L.P. and Veritas Geophysical, Ltd.
10.16 -- Expense Allocation and Participation Agreement, dated
April 1, 1996, between Brigham Oil & Gas, L.P. and Gasco
Limited Partnership.
</TABLE>

<PAGE> 97
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
10.16.1 -- Amendment to Expense Allocation and Participation
Agreement, dated October 21, 1996, between Brigham Oil &
Gas, L.P. and Gasco Limited Partnership.
10.17 -- Expense Allocation and Participation Agreement, dated
April 1, 1996, between Brigham Oil & Gas, L.P. and Middle
Bay Oil Company, Inc.
10.17.1 -- Amendment to Expense Allocation and Participation
Agreement, dated September 26, 1996, between Brigham Oil
& Gas, L.P. and Middle Bay Oil Company, Inc.
10.17.2 -- Letter Amendment to Expense Allocation and Participation
Agreement, dated May 20, 1996, between Brigham Oil & Gas,
L.P. and Middle Bay Oil Company, Inc.
10.18 -- Anadarko Basin Joint Participation Agreement, dated May
1, 1996, by and among Stephens Production Company and
Brigham Oil & Gas, L.P.
10.19 -- Anadarko Basin Joint Participation Agreement, dated May
1, 1996, by and between Vintage Petroleum, Inc. and
Brigham Oil & Gas, L.P.
10.20 -- Processing Alliance Agreement, dated July 20, 1993,
between Veritas Seismic Ltd. and Brigham Oil & Gas, L.P.
10.20.1 -- Letter Amendment to Processing Alliance Agreement, dated
November 3, 1994, between Veritas Seismic Ltd. and
Brigham Oil & Gas, L.P.
10.21 -- Agreement and Assignment of Interest, West Bradley
Project, dated September 1, 1995, by and between Aspect
Resources Limited Liability Company and Brigham Oil &
Gas, L.P.
10.22 -- Agreement and Assignment of Interests in lands located in
Grady County, Oklahoma, West Bradley Project, dated
December 1, 1995, by and between Aspect Resources Limited
Liability Company, Brigham Oil & Gas, L.P. and Venture
Acquisitions, L.P.
10.23 -- Agreement and Assignment of Interests, West Bradley
Project, dated December 1, 1995, by and between Aspect
Resources Limited Liability Company and Brigham Oil &
Gas, L.P.
10.24 -- Geophysical Exploration Agreement, Hardeman Project,
Hardeman and Wilbarger Counties, Texas and Jackson
County, Oklahoma, dated March 15, 1993 by and among
General Atlantic Resources, Inc., Maynard Oil Company,
Ruja Muta Corporation, Tucker Scully Interests Ltd., JHJ
Exploration, Ltd., Cheyenne Petroleum Company, Antrim
Resources, Inc., and Brigham Oil & Gas, L.P.
10.25 -- Agreement and Partial Assignment of Interests in OK13-P
Prospect Area, Jackson County, Oklahoma (Hardeman
Project), dated August 1, 1995, by and between Brigham
Oil & Gas, L.P. and Aspect Resources Limited Liability
Company.
10.26 -- Agreement and Partial Assignment of Interests in Q140-E
Prospect Area, Hardeman County, Texas (Hardeman Project),
dated August 1, 1995, by and between Brigham Oil & Gas,
L.P. and Aspect Resources Limited Liability Company.
10.27 -- Agreement and Partial Assignment of Interests in Hankins
#1 Chappel Prospect Agreement, Jackson County, Oklahoma
(Hardeman Project), dated March 21, 1996, by and between
Brigham Oil & Gas, L.P., NGR, Ltd. and Aspect Resources
Limited Liability Company.
10.28+ -- Form of Indemnity Agreement between the Registrant and
each of its executive officers.
</TABLE>

<PAGE> 98
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
21+ -- Subsidiaries of the Registrant.
23.1+ -- Consent of Thompson & Knight, A Professional Corporation
(included in Exhibit 5 above).
23.2 -- Consent of Price Waterhouse LLP, independent public
accountants.
23.3 -- Consent of Cawley, Gillespie & Associates, Inc.,
independent petroleum engineers.
24.1 -- Powers of Attorney (included on the first signature page
to this Registration Statement).
27 -- Financial Data Schedule.
</TABLE>

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

+ To be filed by amendment.

* Management contract or compensatory plan.

<PAGE> 1

EXHIBIT 2.1
EXCHANGE AGREEMENT

This EXCHANGE AGREEMENT (this "AGREEMENT") is entered into as of
February 26, 1997, by and among BRIGHAM EXPLORATION COMPANY, a Delaware
corporation ("CORPORATION"), BRIGHAM OIL & GAS, L.P., a Delaware limited
partnership ("PARTNERSHIP"), BRIGHAM, INC. (f/k/a Brigham Exploration Company),
a Texas corporation ("OLD BEC"), GENERAL ATLANTIC PARTNERS III, L.P., a
Delaware limited partnership ("GAP"), GAP-BRIGHAM PARTNERS, L.P., a Delaware
limited partnership ("GBP"), BEN M. BRIGHAM, ANNE L. BRIGHAM, HAROLD D. CARTER,
CRAIG M. FLEMING, DAVID T. BRIGHAM, JON L. GLASS, RIMCO PARTNERS, L.P. II
("RPII"), RIMCO PARTNERS, L.P. III ("RPIII") and RIMCO PARTNERS, L.P. IV
("RPIV").

RECITALS:

WHEREAS, Ben M. Brigham and Anne L. Brigham own, in the aggregate, all
of the outstanding shares of capital stock of Old BEC (the "OLD BEC STOCK") (in
such capacity such persons are referred to herein as the "SHAREHOLDERS");

WHEREAS, Old BEC and GAP are the only general partners of the
Partnership;

WHEREAS, RPII, RPIII and RPIV (collectively, "RIMCO") are the owners
of certain 5% Convertible Subordinated Notes Due September 1, 2002 ("RIMCO
NOTES") issued pursuant to that certain Note Purchase Agreement dated as of
August 24, 1995 between the Partnership and RIMCO (the "RIMCO NOTE AGREEMENT");

WHEREAS, Craig M. Fleming, David T. Brigham and Jon L. Glass
(collectively, the "EMPLOYEE LIMITED PARTNERS") each own limited partnership
interests in the Partnership (the "EMPLOYEE LIMITED PARTNERSHIP INTERESTS"),
subject to forfeiture in accordance with the terms of the Partnership
Participating Agreements (as defined herein);

WHEREAS, GBP and Harold D. Carter (collectively, the "NON-EMPLOYEE
LIMITED PARTNERS") are limited partners in the Partnership;

WHEREAS, the Shareholders, GAP, RIMCO, the Employee Limited Partners
and the Non-Employee Limited Partners desire to consolidate in the Corporation
their interests in Old BEC and the Partnership by means of the Exchange (as
defined herein below);

WHEREAS, the parties hereto intend that Section 351(a) of the Internal
Revenue Code of 1986, as amended, will apply to the Exchange;

NOW, THEREFORE, in consideration of the premises and of the mutual
representations, warranties and covenants herein contained, the parties hereto
hereby agree as follows:
<PAGE> 2
ARTICLE I

DEFINITIONS

1.1 As used herein, the terms defined above shall have the meaning
set forth above and the following terms shall have the following meanings:

"Aggregate Exchange Shares" has the meaning set forth in Annex 1
hereto.

"Closing" has the meaning set forth in Section 5.2 hereof.

"Closing Date" means the date on which the Closing occurs.

"Code" means the Internal Revenue Code of 1986, as amended.

"Corporation Common Stock" means the Common Stock, $.01 par value per
share, of the Corporation.

"Corporation Participating Agreements" has the meaning set forth in
Section 2.3.

"Daily Accrual Amount" means an amount equal to (i) 3%, times (ii)
$16,000,000, divided by (iii) 360.

"Deferred Interest" has the meaning set forth in the RIMCO Note
Agreement.

"Encumbrances" has the meaning set forth in Section 4.1.

"Exchange" means, collectively, the transactions contemplated by
Sections 3.1, 3.2 and 3.3.

"Governmental Body" has the meaning set forth in Section 4.1.

"Partnership Plan" the Partnership Employee Equity Interests Plan of
the Partnership dated as of July 1, 1994.

"Partnership Participating Agreements" means the Employee Equity
Interests Plan Participating Agreement between the Partnership and each
Employee Limited Partner, entered into in connection with the Partnership Plan.

"Partnership Agreement" means the Agreement of Limited Partnership of
the Partnership, as amended.

"Permitted Encumbrances" has the meaning set forth in Section 4.1.

"Plan" has the meaning set forth in Section 2.3.

"Public Offering Condition" has the meaning set forth for such term in
Section 5.1.

2
<PAGE> 3

"Securities" means collectively, the Old BEC Stock, the RIMCO Notes
and the interests in the Partnership to be transferred to the Corporation
pursuant to the Exchange.

"Securities Act" means the Securities Act of 1933, as amended.

"Security Holders" means collectively, the Shareholders, GAP, RIMCO,
the Non-Employee Limited Partners and the Employee Limited Partners.

"Transfer Letter" means a letter from a Security Holder stating that
such person is transferring securities to the Corporation pursuant to this
Agreement and confirming the continuing accuracy of such persons's
representations and warranties set forth herein.

1.2 Capitalized terms which are used but not defined herein shall
have the meanings set forth for such terms in the Partnership Agreement.

ARTICLE II

AGREEMENTS RELATING TO THE EXCHANGE

2.1 Achievement of Threshold Value. Each of the parties hereto
acknowledges and agrees that upon satisfaction of the Public Offering Condition
(i) the Partnership will have achieved Threshold Value during the current
fiscal year, and (ii) the fair market value of the assets of the Partnership is
such that if any liquidating distributions were to be made to the Partners
pursuant to Article XI of the Partnership Agreement such distributions would be
in accordance with the Post Threshold Ratios.

2.2 RIMCO Notes. On the Closing Date, the Partnership shall pay
to RIMCO an amount equal to the accrued and unpaid interest on the RIMCO Notes,
excluding "Deferred Interest" (as defined in the RIMCO Note Agreement), as of
such date. In addition, on the earlier of (i) the date of the closing of the
initial public offering of shares of Corporation Common Stock, or (ii)
September 30, 1997, the Partnership shall pay to RIMCO an amount equal to the
Daily Accrual Amount multiplied by the number of days from the Closing Date to
such payment date.

2.3 Incentive Plan; Termination of Partnership Plan; Employee
Restricted Stock.

(a) The Corporation shall adopt an omnibus incentive plan for its
directors, officers and employees (the "PLAN"), in substantially the form set
forth as Exhibit A hereto, to be effective as of the Closing Date.

(b) Each of the Employee Limited Partners shall enter into an
agreement with the Corporation (the "CORPORATION PARTICIPATING AGREEMENTS"), to
be effective as of the Closing Date, which provides that the Corporation Common
Stock issued to such Employee Limited Partner in exchange for Employee Limited
Partnership Interests shall be subject to forfeiture under circumstances
similar to those set forth in the Partnership Participating Agreements. Upon

3
<PAGE> 4
consummation of the Exchange, the Partnership's Employee Equity Interests Plan
shall terminate and be of no further force and effect.

(c) The parties acknowledge that immediately following the
Closing, the Corporation will grant options under the Plan to certain of its
employees to purchase shares of Corporation Common Stock equal to approximately
13% of the total number of outstanding shares of Corporation Common Stock or
1,530,669 shares.

2.4 Employment Agreement. Ben M. Brigham shall have executed and
delivered to the Corporation an employment agreement in substantially the form
set forth in Exhibit B hereto.

2.5 Registration Rights Agreement. Each of the parties hereto
shall have entered into a Registration Rights Agreement with the Corporation,
in substantially the form set forth in Exhibit C hereto.

2.6 Agreement Re: Exchange. Each of the Shareholders, the
Partnership, the Corporation, and the General Partners and RIMCO shall have
entered into a letter agreement, in substantially the form set forth in Exhibit
D hereto.

2.7 Other Actions. The parties hereto shall take such other
actions as shall be necessary to effect the Exchange and to satisfy all of the
conditions set forth in Article V of this Agreement.

ARTICLE III

THE EXCHANGE

3.1 Exchange of Old BEC Common Stock. At the Closing, each
Shareholder shall transfer to the Corporation all of the shares of Old BEC
Stock held by such Shareholder. Such transfer shall be effected by delivery to
the Corporation of a duly executed Transfer Letter together with the
certificates representing such shares duly endorsed for transfer to the
Corporation. In exchange for such transfer, each Shareholder shall be entitled
to receive such number of shares of Corporation Common Stock set forth opposite
such Shareholder's name in Attachment I hereto, which is equal to the number of
Aggregate Exchange Shares times the percentage set forth opposite such
Shareholder's name in Attachment I (rounded to the nearest whole share).

3.2 Exchange of Employee Limited Partnership Interests. At the
Closing, each Employee Limited Partner shall transfer to the Corporation all of
the Employee Limited Partnership Interests held by such Partner. Such transfer
shall be effected by such Partner's delivery to the Corporation of a duly
executed Transfer Letter, whereupon the Corporation Participating Agreement
with such Partner shall become effective and the Partnership Participating
Agreement with such Partner shall terminate and be of no further force and
effect. In exchange for such transfer, each Employee Limited Partner shall be
entitled to receive such number of shares of Corporation Common Stock set forth
opposite such Employee Limited Partner's name in Attachment I hereto, which is
equal to the number of Aggregate Exchange

4
<PAGE> 5
Shares times the percentage set forth opposite such Employee Limited Partner's
name in Attachment I (rounded to the nearest whole share).

3.3 Exchange of Other Partnership Interests. At the Closing, GAP
and each Non-Employee Limited Partner shall transfer to the Corporation all of
the partnership interests held by such Partner. Such transfers shall be
effected by such Partner's delivery to the Corporation of a duly executed
Transfer Letter. In exchange for such transfer, each transferring Partner
shall be entitled to receive such number of shares of Corporation Common Stock
set forth opposite such partner's name in Attachment I hereto, which is equal
to the number of Aggregate Exchange Shares times the percentage set forth
opposite such partner's name in Attachment I (rounded to the nearest whole
share).

3.4 Exchange of RIMCO Notes. At the Closing, RIMCO shall transfer
to the Corporation all of the RIMCO Notes held by RIMCO. Such transfer shall
be effected by RIMCO's delivery to the Corporation of a duly executed Transfer
Letter together with the RIMCO Notes duly endorsed for transfer to the
Corporation. In exchange for such transfer, each holder of the RIMCO Notes
shall be entitled to receive such number of shares of Corporation Common Stock
set forth opposite RIMCO's name in Attachment I hereto, which is equal to the
number of Aggregate Exchange Shares times the percentage set forth opposite
such RIMCO's name in Attachment I (rounded to the nearest whole share).

3.5 Issuance of Certificates. The Corporation shall cause
certificates representing the shares of Corporation Common Stock issued to the
Security holders pursuant to Section 3.1 - 3.4 to be delivered as promptly as
possible following the Closing.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

4.1 Security Holder Representations. Each Security Holder hereby
represents and warrants to, and covenants and agrees with, the Corporation as
follows:

(a) Such Security Holder has been afforded access to, and given an
opportunity to review, all information relating to the Corporation and the
Exchange which Security Holder deemed necessary in order to make an informed
decision concerning participation in the Exchange.

(b) Such Security Holder acknowledges that (i) the shares of
Corporation Common Stock to be issued in the Exchange are being issued under
exemptions from registration provided for in the Securities Act and that
further transfers of such shares will not be permitted except pursuant to an
effective registration under the Securities Act or in a transaction pursuant to
which Corporation has received evidence reasonably satisfactory to it of
compliance with the Securities Act and other applicable securities laws, and
(ii) a legend indicating that the shares of Corporation Common Stock have not
been registered under applicable federal and state securities

5
<PAGE> 6
laws and referring to the restrictions on transferability and sale of the
shares of Corporation Common Stock may be placed on any certificate(s) for such
shares.

(c) Such Security Holder has no present plan or intent to sell,
transfer or otherwise dispose of the shares of Corporation Common Stock to be
received by (he/she/it) in the Exchange, other than a sale of Corporation
Common Stock pursuant to the registration statement filed by the Corporation in
connection with the initial public offering of shares of Corporation Common
Stock.

(d) Such Security Holder has (i) valid title to the Securities to
be transferred by (him/her/it) in the Exchange, free and clear of all security
interests, liens, encumbrances, options, calls, pledges, trusts, voting trusts
and other stockholder agreements, assessments, covenants, restrictions,
reservations, commitments, obligations and other burdens (collectively,
"ENCUMBRANCES"), except for restrictions (A) imposed by applicable federal and
state securities laws, and (B) arising under existing agreements among the
parties hereto, including, without limitation, those under the Partnership
Agreement and the Partnership Participating Agreements (such encumbrances
described in clauses (A) and (B) are referred to herein as "PERMITTED
ENCUMBRANCES"), and (ii) full right, power and authority to assign, transfer
and deliver the Securities hereunder. Upon the issuance and delivery to the
Corporation of the Securities, the Corporation will acquire valid title to such
Securities, subject to no Encumbrances other than Permitted Encumbrances.

(e) This Agreement has been duly executed and delivered by such
Security Holder and constitutes a valid and legally binding obligation of such
Security Holder enforceable against such Security Holder in accordance with its
terms, except to the extent enforcement may be limited by (i) applicable
bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or
similar laws from time to time in effect which affect creditors' rights
generally, and (ii) legal and equitable limitations on the availability of
equitable remedies.

(f) The execution, delivery and performance of this Agreement by
such Security Holder will not (i) conflict with or result in a violation of any
provision of, or constitute (with or without the giving of notice or the
passage of time or both) a default under, or give rise (with or without the
giving of notice or the passage of time or both) to any right of termination,
cancellation or acceleration under, any bond, debenture, note, mortgage,
indenture, lease, agreement or other instrument or obligation to which such
Security Holder is a party or may be bound, (ii) result in the creation or
imposition of any Encumbrance upon the Securities, or (iii) result in a
violation by such Security Holder of any statute or law or any judgment, order,
decree, rule or regulation of any federal, state, municipal or any other
governmental department, commission, board, bureau, agency or instrumentality
(a "GOVERNMENTAL BODY"), to which such Security Holder is subject.

(g) No consent, order, approval or authorization of, or
declaration, filing or registration with, any Governmental Body is required to
be obtained or made by such Security Holder in connection with the execution,
delivery or performance by such Security Holder of this Agreement.

6
<PAGE> 7
4.2 Corporation Representations. The Corporation represents and
warrants to, and covenants and agrees with, each Security Holder as follows:

(a) The shares of Corporation Common Stock have been duly
authorized for issuance pursuant to this Agreement and, when issued and
delivered to the Security Holders in exchange for the Securities transferred
pursuant hereto, will be validly issued, fully paid and nonassessable. The
issuance of Corporation Common Stock under this Agreement is not subject to any
preemptive rights.

(b) The Corporation is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware. The
Corporation has the corporate power to enter into and be bound by the terms and
conditions of this Agreement, and to carry out its obligations hereunder, and
the execution and delivery by the Corporation of this Agreement and the
performance by the Corporation of its obligations hereunder have been duly
authorized by all necessary corporate action. This Agreement has been duly
executed and delivered by the Corporation and constitutes a valid and legally
binding obligation of the Corporation enforceable against it in accordance with
its terms, except to the extent enforcement may be limited (i) by applicable
bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or
similar laws from time to time in effect which affect creditors' rights
generally and (ii) by legal and equitable limitations on the availability of
equitable remedies.

(c) The execution, delivery and performance of this Agreement by
the Corporation will not (i) conflict with or result in a violation of any
provision of the Corporation's charter or bylaws, (ii) conflict with or result
in a violation of any provision of, or constitute (with or without the giving
of notice or the passage of time or both) a default under, or give rise (with
or without the giving of notice or the passage of time or both) to any right of
termination, cancellation, or acceleration under, any bond, debenture, note,
mortgage, indenture, lease, agreement or other instrument or obligation to
which the Corporation is a party or by which it or any of its properties or
assets may be bound, or (iii) result in a violation by the Corporation of any
statute or law or any judgment, order, decree, rule or regulation of any court
or Governmental Body to which the Corporation is subject.

(d) No consent, order, approval or authorization of, or
declaration, filing or registration with, any Governmental Body is required to
be obtained or made by the Corporation in connection with the execution,
delivery or performance by the Corporation of this Agreement.

4.3 Survival of Representations and Warranties. The
representations, warranties and covenants of the parties hereto shall not
survive the Closing.

7
<PAGE> 8
ARTICLE V

CONDITIONS TO THE EXCHANGE; CLOSING; AND TERMINATION

5.1 Conditions to the Exchange. The obligations of each party
hereto to consummate the Exchange are subject to the satisfaction on or before
the Closing Date of the following conditions:

(a) All the representations and warranties of the parties hereto
contained in this Agreement shall be true and correct in all material respects
on and as of the Closing Date as if made on and as of the Closing Date;

(b) Each of the agreements set forth in Article II which are
required to be performed on or before the Closing Date shall have been fully
performed; and

(c) Each of the following shall have been satisfied: (i) the
Corporation shall have filed a registration statement pursuant to the
Securities Act with respect to an initial public offering of shares of
Corporation Common Stock, (ii) the Corporation shall have received a letter
from the proposed lead managing underwriter of such offering which sets forth
its estimates of the market value of the Corporation immediately following such
offering (which may be stated as a range) and the estimated amount of equity to
be raised in the offering, (iii) the lowest estimated post- offering market
value of the Corporation less the estimated amount of equity to be raised in
the offering, as set forth in such letter, shall be at least equal to
$87,500,000 (such condition is referred to herein as the "PUBLIC OFFERING
CONDITION").

5.2 Closing. The closing of the Exchange (the "CLOSING") shall
occur on such date and at such time and place as specified by the Shareholders,
but in no event later than the second business day following the satisfaction
of all of the conditions in Section 5.1 hereof.

5.3 Termination. This Agreement may be terminated at any time
prior to the Closing (a) by the mutual consent of the parties hereto; or (ii)
by any party hereto, if the Public Offering Condition has not been satisfied
before September 30, 1997. In the event of the termination of this Agreement
pursuant to this Section 5.3, this Agreement shall become void and have no
effect.

ARTICLE VI

MISCELLANEOUS

6.1 Consent and Agreement of the General Partners. The General
Partners hereby consent to the transactions contemplated hereby pursuant to
which the Corporation will become the owner of the Old BEC Stock and the owner
of the general partnership interest of GAP and all limited partnership interest
in the Partnership and consent to the substitution of the Corporation as a
Limited Partner in accordance with Article IX of the Partnership Agreement.

8
<PAGE> 9
6.2 Modification or Amendment. Subject to applicable law, at any
time prior to the Closing, this Agreement may be modified or amended by the
mutual consent in writing of all of the parties hereto.

6.3 Waiver of Conditions. The conditions to the parties'
obligations to consummate the Exchange may be waived in whole or in part, to
the extent permitted by applicable law, by the mutual consent in writing of all
of the parties hereto.

6.4 Expenses. Whether or not the Exchange contemplated by this
Agreement shall be consummated, any fees and expenses incurred by GAP or RIMCO
in connection with this Agreement, up to a maximum of $15,000 for such Security
Holder, shall be borne by the Partnership.

6.5 Counterparts. For the convenience of the parties hereto, this
Agreement may be executed in any number of counterparts, each such counterpart
being deemed to be an original instrument, and all such counterparts shall
together constitute the same agreement.

6.6 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS, WITHOUT GIVING
EFFECT TO THE PRINCIPLES OF CONFLICT OF LAWS THEREOF.

6.7 Headings. The article and section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.

6.8 Entire Agreement. This Agreement and the agreements referred
to in Article II hereof constitute the entire agreement between the parties
with respect to the transactions contemplated hereby and shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns. This Agreement and the agreements referred to in Article II
hereof supersede all prior agreements, arrangements and understandings related
to the subject matter hereof.

9
<PAGE> 10
IN WITNESS WHEREOF, the parties have executed this Agreement or caused
the same to be executed by their duly authorized corporate officers, all as of
the day and year first above written.

BRIGHAM EXPLORATION COMPANY, a Delaware corporation

By: /s/ BEN M. BRIGHAM
----------------------------------------------------
Name: Ben M. Brigham
--------------------------------------------------
Title: President
-------------------------------------------------

BRIGHAM OIL & GAS, L.P., a Delaware limited partnership

By: Brigham Inc., its Managing General Partner

BRIGHAM, Inc., a Texas corporation

GENERAL ATLANTIC PARTNERS III, L.P., a Delaware limited
partnership

By: /s/ STEPHEN P. REYNOLDS
----------------------------------------------------
Name: Stephen P. Reynolds
--------------------------------------------------
Title: President
-------------------------------------------------

10
<PAGE> 11

GAP-BRIGHAM PARTNERS, L.P., a
Delaware limited partnership

By: /s/ STEPHEN P. REYNOLDS
-----------------------------------------------------
Name: Stephen P. Reynolds
---------------------------------------------------
Title: General Partner
--------------------------------------------------

/s/ BEN M. BRIGHAM
--------------------------------------------------------
BEN M. BRIGHAM

/s/ ANNE L. BRIGHAM
--------------------------------------------------------
ANNE L. BRIGHAM

/s/ HAROLD D. CARTER
--------------------------------------------------------
HAROLD D. CARTER

/s/ CRAIG M. FLEMING
--------------------------------------------------------
CRAIG M. FLEMING

/s/ DAVID T. BRIGHAM
--------------------------------------------------------
DAVID T. BRIGHAM

/s/ JON L. GLASS
--------------------------------------------------------
JON L. GLASS

11
<PAGE> 12
RIMCO PARTNERS, L.P. II
RIMCO PARTNERS, L.P. III
RIMCO PARTNERS, L.P. IV

By: Resource Investors Management Company Limited
Partnership, the General Partner of each

By: RIMCO Associates, Inc., its General Partner

By: /s/ GARY J. MILAVEC
----------------------------------------------------
Gary J. Milavec, Vice President

<PAGE> 1

EXHIBIT 3.1
CERTIFICATE OF INCORPORATION

BRIGHAM EXPLORATION COMPANY

FIRST: The name of the corporation is BRIGHAM EXPLORATION COMPANY
(the "Corporation").

SECOND: The address of its registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, Wilmington, County of New
Castle, Delaware 19801. The name of its registered agent at such address is
The Corporation Trust Company.

THIRD: The nature of the business or purpose to be conducted or
promoted is to engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of the State of Delaware.

FOURTH: The total number of shares of all classes of stock which the
Corporation shall have authority to issue is 40,000,000 shares, consisting
solely of 10,000,000 shares of Preferred Stock, par value $.01 per share (the
"Preferred Stock"), and 30,000,000 shares of Common Stock, par value $.01 per
share (the "Common Stock").

The following is a statement of the designations and the powers,
preferences and rights, and the qualifications, limitations or restrictions
thereof, of the classes of stock of the Corporation:

(a) Preferred Stock.

Shares of Preferred Stock may be issued from time to time in one or
more series as from time to time may be determined by the Board of Directors of
the Corporation. Each series shall be distinctly designated. The Board of
Directors of the Corporation is hereby expressly granted authority to fix, by
resolution or resolutions adopted prior to the issuance of any shares of each
particular series of Preferred Stock, the designation, powers, preferences and
relative, participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, if any, of such series,
including, but without limiting the generality of the foregoing, the following:

(i) the designation of, and the number of shares of Preferred
Stock which shall constitute, the series, which number may be
increased (except as otherwise fixed by the Board of Directors, and in
any event not above the total number of authorized shares of the
class) or decreased (but not below the number of shares thereof then
outstanding) from time to time by action of the Board of Directors;

(ii) the rate and times at which (or the method of determination
thereof), and the terms and conditions upon which, dividends, if any,
on shares of the series shall be paid, the nature of any preferences
or the relative rights of priority of such dividends to the dividends
payable on any other class or classes of stock of the Corporation or
on any other series of Preferred Stock, and a statement whether such
dividends shall be cumulative;
<PAGE> 2
(iii) whether shares of the series shall be convertible into or
exchangeable for shares of capital stock or other securities or
property of the Corporation or of any other corporation or entity,
and, if so, the terms and conditions of such conversion or exchange,
including any provisions for the adjustment of the conversion or
exchange rate in such events as the Board of Directors shall
determine;

(iv) whether shares of the series shall be redeemable, and, if so,
the terms and conditions of such redemption, including the date or
dates upon or after which they shall be redeemable, and the amount and
type of consideration payable in case of redemption, which amount may
vary under different conditions and at different redemption dates;

(v) the rights, if any, of the holders of shares of the series
upon voluntary or involuntary liquidation, merger, consolidation,
distribution or sale of assets, dissolution or winding-up of the
Corporation;

(vi) whether shares of the series shall have a sinking fund or
purchase account for the redemption or purchase of shares of the
series, and, if so, the terms, conditions and amount of such sinking
fund or purchase account;

(vii) whether shares of the series shall have voting rights in
addition to the voting rights provided by law, which may, without
limiting the generality of the foregoing, include (A) the right to
more or less than one vote per share on any or all matters voted upon
by the Corporation's stockholders and (B) the right to vote, as a
series by itself or together with other series of Preferred Stock or
together with all series of Preferred Stock as a class or with the
Common Stock as a class, upon such matters, under such circumstances
and upon such conditions as the Board of Directors may fix, including,
without limitation, the right, voting as a series by itself or
together with other series of Preferred Stock or together with all
series of Preferred Stock as a class, to elect one or more directors
of the Corporation in the event there shall have been a default in the
payment of dividends on any one or more series of Preferred Stock or
under such other circumstances and upon such conditions as the Board
of Directors may determine; and

(viii) any other powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions, of shares of that series.

The relative powers, preferences and rights of each series of Preferred Stock
in relation to the powers, preferences and rights of each other series of
Preferred Stock shall, in each case, be as fixed from time to time by the Board
of Directors in the resolution or resolutions adopted pursuant to the authority
granted in this subsection (a), and the consent, by class or series vote or
otherwise, of the holders of Preferred Stock or such of the series of the
Preferred Stock as are from time to time outstanding shall not be required for
the issuance by the Corporation of any other series of Preferred Stock, whether
the powers, preferences and rights of such other series shall be fixed by the
Board of Directors as senior to, or on a parity with, the powers, preferences
and rights of such outstanding series, or any of them; provided, however, that
the Board of Directors may provide in such resolution or resolutions adopted
with respect to any series of Preferred Stock that the consent of the holders
of a majority (or such greater proportion as shall be therein fixed) of the
outstanding shares of such series voting thereon shall be required for the
issuance of any or all other series of Preferred Stock.

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<PAGE> 3
(b) Common Stock.

(i) Dividends. After the requirements with respect to
preferential dividends on Preferred Stock, if any, shall have been met
and after the Corporation shall have complied with all the
requirements, if any, with respect to the setting aside of sums as
sinking funds or redemption or purchase accounts and subject further
to any other conditions which may be fixed in accordance with the
provisions of this Certificate of Incorporation, then, but not
otherwise, the holders of Common Stock shall be entitled to receive
such dividends, if any, as may be declared from time to time by the
Board of Directors on the Common Stock, which dividends shall be paid
out of assets legally available for the payment of dividends and shall
be distributed among the holders of shares of the Common Stock pro
rata in accordance with the number of shares of such stock held by
each such holder.

(ii) Liquidation. After distribution in full of the preferential
amount, if any, to be distributed to the holders of Preferred Stock in
the event of voluntary or involuntary liquidation, distribution or
sale of assets, dissolution or winding-up of the Corporation, the
holders of the Common Stock shall be entitled to receive all the
remaining assets of the Corporation, tangible and intangible, of
whatever kind available for distribution to stockholders, which assets
shall be distributed pro rata in accordance with the number of shares
of such stock held by each such holder.

(iii) Voting. Except as may otherwise be required by law, this
Certificate of Incorporation or the provisions of the resolution or
resolutions as may be adopted by the Board of Directors pursuant to
subsection (a) of this Article FOURTH, each holder of Common Stock
shall have one vote in respect of each share of Common Stock held by
such holder on each matter voted upon by the stockholders.

FIFTH: The following provisions are inserted for the management of
the business and for the conduct of the affairs of the Corporation, and for
further definition, limitation and regulation of the powers of the Corporation
and of its directors and stockholders:

(a) Management. The business and affairs of the Corporation
shall be managed by or under the direction of the Board of Directors.

(b) Number of Directors. Subject to the rights of the holders of
any series of Preferred Stock to elect additional directors under specified
circumstances, the number of directors of the Corporation shall initially be
established at seven, but thereafter may be changed to any number not less than
five nor more than nine as fixed from time to time by or pursuant to the Bylaws
of the Corporation. Each director, other than a director who may be elected by
the holders of any series of Preferred Stock under specified circumstances,
shall hold office until his successor is elected and qualified or until his
earlier resignation or removal. Election of directors need not be by written
ballot unless the Bylaws of the Corporation so provide.

(c) Initial Directors. The names and mailing addresses of
the persons who are to serve as directors until the first annual meeting of the
holders of capital stock of the Corporation or until their successors are
elected and qualify are:

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<PAGE> 4
Name: Mailing Address:
- ----- ---------------

Ben B. Brigham 5949 Sherry Lane, Suite 1616
Dallas, Texas 75225

Anne L. Brigham 5949 Sherry Lane, Suite 1616
Dallas, Texas 75225

Jon L. Glass 5949 Sherry Lane, Suite 1616
Dallas, Texas 75225

Harold D. Carter 5949 Sherry Lane, Suite 1616
Dallas, Texas 75225

Alexis M. Cranberg 535 16th Street, Suite 820
Denver, Colorado 80202

Steven Reynolds 3 Pickwick Plaza, Suite 200
Greenwich, Connecticut 06830

Gary J. Milavec 600 Travis Street, Suite 6875
Houston, Texas 77002

(d) Stockholder Nomination of Directors and Introduction of
Business. Advance notice of stockholder nominations for the election of
directors and of business to be brought by stockholders before any meeting of
the stockholders of the Corporation shall be given in the manner and to the
extent provided in the Bylaws of the Corporation.

(e) Bylaws. In furtherance and not in limitation of the powers
conferred by law, the Board of Directors is expressly authorized to adopt,
alter, amend and repeal the Bylaws of the Corporation, subject to the power of
the stockholders of the Corporation to adopt, alter, amend and repeal the
Bylaws.

(f) Powers of Directors. In addition to the powers and authority
hereinbefore or by statute expressly conferred upon them, the directors are
hereby empowered to exercise all such powers and do all such acts and things as
may be exercised or done by the Corporation, subject, nevertheless, to the
provisions of the statutes of Delaware, this Certificate of Incorporation and
any Bylaws adopted by the stockholders; provided, however, that no Bylaws
thereafter adopted by the stockholders shall invalidate any prior act of the
directors which would have been valid if such Bylaws had not been adopted.

SIXTH: Whenever a compromise or arrangement is proposed between the
Corporation and its creditors or any class of them and/or between the
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of the Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for the Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in

-4-
<PAGE> 5
dissolution or of any receiver or receivers appointed for the Corporation under
the provisions of Section 279 of Title 8 of the Delaware Code order a meeting
of the creditors or class of creditors, and/or of the stockholders or class of
stockholders of the Corporation, as the case may be, to be summoned in such
manner as the said court directs. If a majority in number representing three
fourths in value of the creditors or class of creditors, and/or of the
stockholders or class of stockholders of the Corporation, as the case may be,
agree to any compromise or arrangement and to any reorganization of the
Corporation as a consequence of such compromise or arrangement, the said
compromise arrangement and the said reorganization shall, if sanctioned by the
court to which the said application has been made, be binding on all the
creditors or class of creditors and/or on all the stockholders or class of
stockholders, of the Corporation, as the case may be, and also on the
Corporation.

SEVENTH: (a) Elimination of Certain Liability of Directors.
To the fullest extent permitted by the Delaware General Corporation Law as the
same exists or may hereafter be amended, a director of the Corporation shall
not be personally liable to the Corporation or its stockholders for monetary
damages for breach of duty as a director. Without limiting the foregoing in
any respect, a director of the Corporation shall not be personally liable to
the Corporation or its stockholders for monetary damages for breach of duty as
a director, except for liability (i) for any breach of the director's duty of
loyalty to the Corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv)
for any transaction from which the director derived an improper personal
benefit. If the Delaware General Corporation Law is amended to authorize
corporate action further eliminating or limiting the personal liability of
directors, then the liability of a director of the Corporation shall be
eliminated or limited to the fullest extent permitted by the Delaware General
Corporation Law, as so amended. Any repeal or modification of this provision
shall not adversely affect any right or protection of a director of the
Corporation existing at the time of such repeal or modification.

(b) Indemnification and Insurance.

(i) Right to Indemnification. (A) Each person who was or is made
a party or is threatened to be made a party to or is involved in any
action, suit or proceeding, whether civil, criminal, administrative or
investigative (hereinafter a "proceeding"), by reason of the fact that
he or she, or a person of whom he or she is the legal representative,
is or was a director or officer of the Corporation, or serves, in any
capacity, any corporation, partnership or other entity in which the
Corporation has a partnership or other interest, including service
with respect to employee benefit plans, whether the basis of such
proceeding is alleged action in an official capacity as a director,
officer, employee or agent or in any other capacity while serving as a
director, officer, employee or agent, shall be indemnified and held
harmless by the Corporation to the fullest extent authorized by the
Delaware General Corporation Law, as the same exists or may hereafter
be amended (but, in case of any such amendment, only to the extent
that such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to
provide prior to such amendment), against all expense, liability and
loss (including attorneys' fees, judgments, fines, ERISA excise taxes
or penalties and amounts paid or to be paid in settlement) reasonable
incurred or suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of
his or

-5-
<PAGE> 6
her heirs, executors and administrators, and (B) the Corporation shall
indemnify and hold harmless in such manner any person designated by
the Board of Directors, or any committee thereof, as a person subject
to this indemnification provision, and who was or is made a party or
is threatened to be made a party to a proceeding by reason of the fact
that he, she or a person of whom he or she is the legal
representative, is or was serving at the request of the Board of
Directors of the Corporation as a director, officer, employee or agent
of another corporation or a partnership, joint venture, trust or other
enterprise whether such request is made before or after the acts taken
or allegedly taken or events occurring or allegedly occurring which
give rise to such proceeding; provided, however, that except as
provided in subsection (b)(ii) of this Section, the Corporation shall
indemnify any such person seeking indemnification pursuant to this
subsection in connection with a proceeding (or part thereof) initiated
by such person only if such proceeding (or part thereof) was
authorized by the Board of Directors of the Corporation. The right to
indemnification conferred herein shall be a contract right based upon
an offer from the Corporation which shall be deemed to have been made
to a person subject to subsection (b)(i)(A) on the date hereof and to
a person subject to subsection (b)(i)(B) on the date designated by the
Board of Directors, shall be deemed to be accepted by such person's
service or continued service as a director or officer of the
Corporation for any period after the offer is made and shall include
the right to be paid by the Corporation the expenses incurred in
defending any such proceeding in advance of its final disposition;
provided, however, that if the Delaware General Corporation Law
requires, the payment of such expenses incurred by a director or
officer in his or her capacity as the director or officer (and not in
any other capacity in which service was or is rendered by such person
while a director or officer, including, without limitation, service to
an employee benefit plan) in advance of the final disposition of a
proceeding, shall be made only upon delivery to the Corporation of an
undertaking, by or on behalf of such director or officer, to repay all
amounts so advanced if it shall ultimately be determined that such
director or officer is not entitled to be indemnified under this
Section or otherwise. The Corporation may, by action of its Board of
Directors, provide indemnification to employees or agents of the
Corporation with the same scope and effect as the foregoing
indemnification of directors and officers.

(ii) Right of Claimant to Bring Suit. If a claim under Section
(b)(i) of this Article is not paid in full by the Corporation within
thirty days after a written claim has been received by the
Corporation, the claimant may at any time thereafter bring suit
against the Corporation to recover the unpaid amount of the claim and,
if successful in whole or in part, the claimant shall be entitled to
be paid also the expense of prosecuting such claim. It shall be a
defense to any such action (other than an action brought to enforce a
claim for expenses incurred in defending any proceeding in advance of
its final disposition where the required undertaking, if any is
required, has been tendered to the Corporation) that the claimant has
not met the standards of conduct which make it permissible under the
Delaware General Corporation Law for the Corporation to indemnify the
claimant for the amount claimed. Neither the failure of the
Corporation (including its Board of Directors, independent legal
counsel, or its stockholders) to have made a determination prior to
the commencement of such action that indemnification of the claimant
is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware General
Corporation Law, nor an actual determination by the

-6-
<PAGE> 7
Corporation (including its Board of Directors, independent legal
counsel, or its stockholders) that the claimant has not met such
applicable standard of conduct, shall be a defense to the action or
create a presumption that the claimant has not met the applicable
standard of conduct.

(iii) Nonexclusivity of Rights. The right to indemnification and
the payment of expenses incurred in defending a proceeding in advance
of its final disposition conferred in this Section shall not be
exclusive of any right which any person may have or hereafter acquire
under any statute, provision of the Certificate of Incorporation,
by-law, agreement, vote of stockholders or disinterested directors or
otherwise.

(iv) Insurance. The Corporation may maintain insurance, at its
expense, to protect itself and any director officer, employee or agent
of the Corporation or another corporation, partnership, joint venture,
trust or other enterprise against any such expense, liability or loss,
whether or not the corporation would have the power to indemnify such
person against such expense, liability or loss under the Delaware
General Corporation Law.

(v) Severability. If any subsection of this Section (b) shall be
deemed to be invalid or ineffective in any proceedings, the remaining
subsections hereof shall not be affected and shall remain in full
force and effect.

EIGHTH: The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.

NINTH: The name of the incorporator of the Corporation is Jane Rast,
and the mailing address of such incorporator is Thompson & Knight, P.C., 1700
Pacific Avenue, Suite 3300, Dallas, Texas 75201.

IN WITNESS WHEREOF, the undersigned, being the incorporator
hereinbefore named, for the purpose of forming a corporation pursuant to the
General Corporation Law of the State of Delaware, does hereby make and file
this Certificate of Incorporation, hereby declaring and certifying that the
facts herein stated are true, and accordingly has hereunto set the
incorporator's hand this 25th day of February, 1997.

________________________________________
Jane Rast

-7-

<PAGE> 1

EXHIBIT 3.2

BYLAWS

BRIGHAM EXPLORATION COMPANY

EFFECTIVE FEBRUARY 26, 1997
<PAGE> 2
TABLE OF CONTENTS

ARTICLE I

OFFICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Registered Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Other Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE II

MEETINGS OF STOCKHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Place of Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Annual Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 3. Special Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 4. Notice of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 5. Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 6. Adjournments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 7. Order of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 8. List of Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 9. Voting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 10. Inspectors of Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

ARTICLE III

BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1. General Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2. Number, Qualification and Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3. Notification of Nominations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 4. Quorum and Manner of Acting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 5. Place of Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 6. Regular Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 7. Special Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 8. Notice of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 9. Rules and Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 10. Participation in Meeting by Means of Communication Equipment . . . . . . . . . . . . . . . 6
Section 11. Action Without Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 12. Resignations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 13. Removal of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 14. Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 15. Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 16. Advisory Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

ARTICLE IV

EXECUTIVE AND OTHER COMMITTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1. Executive Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2. Other Committees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 3. Procedure; Meetings; Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
</TABLE>

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<TABLE>
<S> <C> <C>

ARTICLE V

OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 1. Number; Term of Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2. Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 3. Resignation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 4. Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5. The President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 6. Chairman of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 7. Vice Presidents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 8. Treasurer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 9. Secretary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 10. Controller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 11. Assistant Treasurers, Secretaries and Controllers . . . . . . . . . . . . . . . . . . . . . 10

ARTICLE VI

INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 1. Third Party Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 2. Derivative Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3. Determination of Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 4. Right to Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 5. Advancement of Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 6. Indemnification and Advancement of Expenses Not Exclusive . . . . . . . . . . . . . . . . . 11
Section 7. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 8. Definitions of Certain Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 9. Continuation and Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 10. Exclusive Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

ARTICLE VII

CAPITAL STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 1. Certificates for Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2. Transfer of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 3. Address of Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 4. Lost, Destroyed and Mutilated Certificates . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 5. Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 6. Fixing Date for Determination of Stockholders of Record . . . . . . . . . . . . . . . . . . 13

ARTICLE VIII

SEAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE IX

FISCAL YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
</TABLE>

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ARTICLE X

WAIVER OF NOTICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE XI

AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

ARTICLE XII

MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 1. Execution of Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 2. Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3. Checks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4. Proxies in Respect of Stock or Other Securities of Other Corporations . . . . . . . . . . . 15
</TABLE>

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BYLAWS

BRIGHAM EXPLORATION COMPANY

ARTICLE I

OFFICES

Section 1. Registered Office. The registered office of Brigham
Exploration Company (hereinafter called the "Corporation") in the State of
Delaware shall be at Corporation Trust Center, 1209 Orange Street, in the City
of Wilmington, County of New Castle, 19801 and the registered agent in charge
thereof shall be The Corporation Trust Company.

Section 2. Other Offices. The Corporation may also have an
office or offices, and keep the books and records of the Corporation, except as
may otherwise be required by law, at such other place or places, either within
or without the State of Delaware, as the Board of Directors may from time to
time determine or the business of the Corporation may require.

ARTICLE II

MEETINGS OF STOCKHOLDERS

Section 1. Place of Meeting. All meetings of the stockholders
of the Corporation shall be held at the office of the Corporation or at such
other places, within or without the State of Delaware, as may from time to time
be fixed by the Board of Directors, the Chairman of the Board or the President.

Section 2. Annual Meetings. Annual meetings of the stockholders
of the Corporation for the election of directors and for the transaction of
such other business as may properly come before such meetings shall be held
during each calendar year on a date and at such hour as may be fixed by the
Board of Directors, the Chairman of the Board or the President. Failure to
designate a time for the annual meeting or to hold the annual meeting at the
designated time shall not work a dissolution of the Corporation.

In order for business to be properly brought before the meeting by a
stockholder, the business must be legally proper and written notice thereof
must have been filed with the Secretary of the Corporation not less than 60 nor
more than 120 days prior to the meeting. Each such notice shall set forth: (a)
the name and address of the stockholder who intends to make the proposal as the
same appears in the Corporation's records; (b) the class and number of shares
of stock of the Corporation that are beneficially owned, directly or
indirectly, by such stockholder; and (c) a clear and concise statement of the
proposal and the stockholder's reasons for supporting it.

The filing of a stockholder notice as required above shall not, in and
of itself, constitute the making of the proposal described therein.

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If the chairman of the meeting determines that any proposed business
has not been properly brought before the meeting, he shall declare such
business out of order; and such business shall not be conducted at the meeting.

Section 3. Special Meetings. Except as otherwise required by
law and subject to the rights of the holders of any class or series of stock
having a preference over the Common Stock as to dividends or upon liquidation,
special meetings of the stockholders for any purpose or purposes may be called
only by (i) the Chairman of the Board, (ii) the President, (iii) a majority of
the entire Board of Directors, or (iv) a majority of the votes entitled to be
cast by the stockholders entitled to vote at such a meeting, or (v) not more
frequently than once during each calendar year, by ten percent of the votes
entitled to be cast by the shareholders entitled to vote at such a meeting.
Only such business as is specified in the notice of any special meeting of the
stockholders shall come before such meeting.

Section 4. Notice of Meetings. Except as otherwise provided by
law, written notice of each meeting of the stockholders, whether annual or
special, shall be given, either by personal delivery or by mail, not less than
10 nor more than 60 days before the date of the meeting to each stockholder of
record entitled to notice of the meeting. If mailed, such notice shall be
deemed given when deposited in the United States mail, postage prepaid,
directed to the stockholder at such stockholder's address as it appears on the
records of the Corporation. Each such notice shall state the place, date and
hour of the meeting, and the purpose or purposes for which the meeting is
called. Notice of any meeting of stockholders shall not be required to be
given to any stockholder who shall attend such meeting in person or by proxy
without protesting, prior to or at the commencement of the meeting, the lack of
proper notice to such stockholder, or who shall waive notice thereof as
provided in Article X of these Bylaws. Notice of adjournment of a meeting of
stockholders need not be given if the time and place to which it is adjourned
are announced at such meeting, unless the adjournment is for more than 30 days
or, after adjournment, a new record date is fixed for the adjourned meeting.

Section 5. Quorum. Except as otherwise provided by law or by
the Certificate of Incorporation of the Corporation, the holders of a majority
of the votes entitled to be cast by the stockholders entitled to vote, which if
any vote is to be taken by classes shall mean the holders of a majority of the
votes entitled to be cast by the stockholders of each such class, present in
person or represented by proxy, shall constitute a quorum for the transaction
of business at any meeting of the stockholders.

Section 6. Adjournments. In the absence of a quorum, the
holders of a majority of the votes present in person or represented by proxy,
may adjourn the meeting from time to time. At any such adjourned meeting at
which a quorum may be present, any business may be transacted which might have
been transacted at the meeting as originally called.

Section 7. Order of Business. At each meeting of the
stockholders, the Chairman of the Board, or, in the absence of the Chairman of
the Board, the President, shall act as chairman. The order of business at each
such meeting shall be as determined by the chairman of the meeting. The
chairman of the meeting shall have the right and authority to prescribe such
rules, regulations and procedures and to do all such acts and things as are
necessary or desirable for the proper conduct of the meeting, including,
without limitation, the establishment of procedures for the maintenance of
order and safety, limitations on the time allotted to questions or comments on
the affairs of the Corporation, restrictions on entry to such meeting after the
time prescribed for the commencement thereof, and the opening and closing of
the voting polls. The chairman of the meeting shall announce at each such
meeting the date

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and time of the opening and the closing of the voting polls for each matter
upon which the stockholders will vote at such meeting.

Section 8. List of Stockholders. It shall be the duty of the
Secretary or other officer of the Corporation who has charge of the stock
ledger to prepare and make, at least 10 days before each meeting of the
stockholders, a complete list of the stockholders entitled to vote thereat,
arranged in alphabetical order, and showing the address of each stockholder and
the number of shares registered in such stockholder's name. Such list shall be
produced and kept available at the times and places required by law.

Section 9. Voting. Except as otherwise provided by law or by
the Certificate of Incorporation of the Corporation, each stockholder of record
of any class or series of stock having a preference over the Common Stock of
the Corporation as to dividends or upon liquidation shall be entitled at each
meeting of stockholders to such number of votes for each share of such stock as
may be fixed in the Certificate of Incorporation or in the resolution or
resolutions adopted by the Board of Directors providing for the issuance of
such stock, and each stockholder of record of Common Stock shall be entitled at
each meeting of stockholders to one vote for each share of such stock, in each
case, registered in such stockholder's name on the books of the Corporation:

(a) on the date fixed pursuant to Section 6 of Article
VII of these Bylaws as the record date for the determination of
stockholders entitled to notice of and to vote at such meeting; or

(b) if no such record date shall have been so fixed, then
at the close of business on the day next preceding the date on which
notice of such meeting is given, or, if notice is waived, at the close
of business on the day next preceding the day on which the meeting is
held.

Each stockholder entitled to vote at any meeting of stockholders may
authorize not in excess of three persons to act for such stockholder by a proxy
signed by such stockholder or such stockholder's attorney-in-fact. Any such
proxy shall be delivered to the secretary of such meeting at or prior to the
time designated for holding such meeting but, in any event, not later than the
time designated in the order of business for so delivering such proxies. No
such proxy shall be voted or acted upon after three years from its date, unless
the proxy provides for a longer period.

At each meeting of the stockholders, all corporate actions, other than
the election of directors, to be taken by vote of the stockholders (except as
otherwise required by law and except as otherwise provided in the Certificate
of Incorporation) shall be authorized by a majority of the votes cast by the
stockholders entitled to vote thereon, present in person or represented by
proxy. At all elections of directors of the Corporation, each holder of Common
Stock, or of any class or classes or of a series or series thereof, shall be
entitled to as many votes as shall equal the number of votes which he would
otherwise be entitled to cast for the election of directors with respect to his
shares of Common Stock multiplied by the number of directors to be elected by
him, and each such holder may cast all of such votes for a single director or
may distribute his votes among the number to be voted for, or for any two or
more directors as such holder may deem fit. Directors shall be elected by a
plurality of the votes of the shares present in person or represented by proxy
at the meeting and entitled to vote on the election of the directors. Where a
separate vote by a class or classes is required, the affirmative vote of the
majority of shares of such class or classes present in person or represented by
proxy at the meeting shall be the act of such class.

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Unless required by law or determined by the chairman of the meeting to
be advisable, the vote on any matter, including the election of directors, need
not be by written ballot. In the case of a vote by written ballot, each ballot
shall be signed by the stockholder voting, or by such stockholder's proxy, and
shall state the number of shares voted.

Section 10. Inspectors of Election. Either the Board of
Directors or, in the absence of an appointment of inspectors by the Board, the
Chairman of the Board or the President shall, in advance of each meeting of the
stockholders, appoint one or more inspectors to act at such meeting and make a
written report thereof. In connection with any such appointment, one or more
persons may, in the discretion of the body or person making such appointment,
be designated as alternate inspectors to replace any inspector who fails to
act. If no inspector or alternate is able to act at any meeting of
stockholders, the chairman of such meeting shall appoint one or more inspectors
to act at such meeting. Each such inspector shall perform such duties as are
required by law and as shall be specified by the Board, the Chairman of the
Board, the President or the chairman of the meeting. Each such inspector,
before entering upon the discharge of his duties, shall take and sign an oath
faithfully to execute the duties of inspector with strict impartiality and
according to the best of his ability. Inspectors need not be stockholders. No
director or nominee for the office of director shall be appointed such an
inspector.

ARTICLE III

BOARD OF DIRECTORS

Section 1. General Powers. The business and affairs of the
Corporation shall be managed by or under the direction of the Board of
Directors, which may exercise all such powers of the Corporation and do all
such lawful acts and things as are not by law or by the Certificate of
Incorporation of the Corporation directed or required to be exercised or done
by the stockholders.

Section 2. Number, Qualification and Election. Except as
otherwise provided in any resolution or resolutions adopted by the Board of
Directors pursuant to the provisions of Article FOURTH of the Certificate of
Incorporation of the Corporation relating to the rights of the holders of any
class or series of stock having a preference over the Common Stock as to
dividends or upon liquidation, the number of directors of the Corporation shall
be fixed from time to time by resolution adopted by vote of a majority of the
entire Board of Directors, provided that the number so fixed shall not be less
than five nor more than nine.

The directors, other than those who may be elected by the holders of
shares of any class or series of stock having a preference over the Common
Stock as to dividends or upon liquidation pursuant to the terms of any
resolution or resolutions providing for the issuance of such stock adopted by
the Board, shall hold office until his successor is elected and qualified or
until his earlier resignation or removal.

Each director shall be at least 21 years of age. Directors need not
be stockholders of the Corporation.

Subject to the rights of the holders of any class or series of stock
having a preference over the Common Stock as to dividends or upon liquidation,
at each annual meeting of the stockholders, all directors of the Corporation
shall be elected.

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In any election of directors, the persons receiving a plurality of the
votes cast, up to the number of directors to be elected in such election, shall
be deemed elected.

Section 3. Notification of Nominations. Subject to the rights
of the holders of any class or series of stock having a preference over the
Common Stock as to dividends or upon liquidation, nominations for the election
of directors may be made by the Board of Directors or by any stockholder
entitled to vote for the election of directors. Any stockholder entitled to
vote for the election of directors at a meeting may nominate persons for
election as directors only if written notice of such stockholder's intent to
make such nomination is given, either by personal delivery or by United States
mail, postage prepaid, to the Secretary of the Corporation not later than (i)
with respect to an election to be held at an annual meeting of stockholders, 90
days in advance of such meeting, and (ii) with respect to an election to be
held at a special meeting of stockholders for the election of directors, the
close of business on the seventh day following the date on which notice of such
meeting is first given to stockholders. Each such notice shall set forth: (a)
the name and address of the stockholder who intends to make the nomination of
the person or persons to be nominated; (b) a representation that the
stockholder is a holder of record of stock of the Corporation entitled to vote
at such meeting and intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice; (c) a description of
all arrangements or understandings between the stockholder and each 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; (d) such other
information regarding each nominee proposed by such stockholder as would have
been required to be included in a proxy statement filed pursuant to the proxy
rules of the Securities and Exchange Commission had each nominee been
nominated, or intended to be nominated, by the Board of Directors; and (e) the
consent of each nominee to serve as a director of the Corporation if so
elected. The chairman of the meeting may refuse to acknowledge the nomination
of any person not made in compliance with the foregoing procedure.

Section 4. Quorum and Manner of Acting. Except as otherwise
provided by law, the Certificate of Incorporation of the Corporation or these
Bylaws, a majority of the entire Board of Directors shall constitute a quorum
for the transaction of business at any meeting of the Board, and, except as so
provided, the vote of a majority of the directors present at any meeting at
which a quorum is present shall be the act of the Board. In the absence of a
quorum, a majority of the directors present may adjourn the meeting to another
time and place. At any adjourned meeting at which a quorum is present, any
business that might have been transacted at the meeting as originally called
may be transacted.

Section 5. Place of Meeting. The Board of Directors may hold
its meetings at such place or places within or without the State of Delaware as
the Board may from time to time determine or as shall be specified or fixed in
the respective notices or waivers of notice thereof.

Section 6. Regular Meetings. Regular meetings of the Board of
Directors shall be held at such times and places as the Board shall from time
to time by resolution determine. If any day fixed for a regular meeting shall
be a legal holiday under the laws of the place where the meeting is to be held,
the meeting that would otherwise be held on that day shall be held at the same
hour on the next succeeding business day.

Section 7. Special Meetings. Special meetings of the Board of
Directors shall be held whenever called by the Chairman of the Board or the
President or by a majority of the directors.

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Section 8. Notice of Meetings. Notice of regular meetings of
the Board of Directors or of any adjourned meeting thereof need not be given.
Notice of each special meeting of the Board shall be mailed or transmitted by
delivery service to each director, addressed to such director at such
director's residence or usual place of business, at least two days before the
day on which the meeting is to be held or shall be sent to such director at
such place by telegraph or facsimile telecommunication or be given personally
or by telephone, not later than the day before the meeting is to be held, but
notice need not be given to any director who shall, either before or after the
meeting, submit a signed waiver of such notice or who shall attend such meeting
without protesting, prior to or at its commencement, the lack of notice to such
director. Every such notice shall state the time and place but need not state
the purpose of the meeting.

Section 9. Rules and Regulations. The Board of Directors may
adopt such rules and regulations not inconsistent with the provisions of law,
the Certificate of Incorporation of the Corporation or these Bylaws for the
conduct of its meetings and management of the affairs of the Corporation as the
Board may deem proper.

Section 10. Participation in Meeting by Means of Communication
Equipment. Any one or more members of the Board of Directors or any committee
thereof may participate in any meeting of the Board or of any such committee by
means of conference telephone or similar 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 such meeting.

Section 11. Action Without Meeting. Any action required or
permitted to be taken at any meeting of the Board of Directors or any committee
thereof may be taken without a meeting if all of the members of the Board or of
any such committee consent thereto in writing and the writing or writings are
filed with the minutes of proceedings of the Board or of such committee.

Section 12. Resignations. Any director of the Corporation may at
any time resign by giving written notice to the Board of Directors, the
Chairman of the Board, the President or the Secretary of the Corporation. Such
resignation shall take effect at the time specified therein or, if the time be
not specified, upon receipt thereof; and unless otherwise specified therein,
the acceptance of such resignation shall not be necessary to make it effective.

Section 13. Removal of Directors. Any director or the entire
board of directors may be removed, with or without cause, by the holders of a
majority of the shares then entitled to vote at an election of directors.

Section 14. Vacancies. Subject to the rights of the holders of
any class or series of stock having a preference over the Common Stock as to
dividends or upon liquidation, any vacancies on the Board of Directors and any
newly created directorship resulting from an increase in the authorized number
of directors, may be filled by election at an annual or special meeting of
stockholders called for that purpose or by the affirmative vote of a majority
of the remaining directors, though less than a quorum of the entire Board, and
the directors so chosen shall hold office until the next annual meeting of
stockholders and until their successors are duly elected and shall qualify,
unless sooner displaced.

Section 15. Compensation. Each director who shall not at the
time also be a salaried officer or employee of the Corporation or any of its
subsidiaries (hereinafter referred to as an "outside director"), in
consideration of such person serving as a director, shall be entitled to
receive from the Corporation such amount per annum and such fees for attendance
at meetings of the Board of Directors or of

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committees of the Board, or both, as the Board shall from time to time
determine. In addition, each director, whether or not an outside director,
shall be entitled to receive from the Corporation reimbursement for the
reasonable expenses incurred by such person in connection with the performance
of such person's duties as a director. Nothing contained in this Section 15
shall preclude any director from serving the Corporation or any of its
subsidiaries in any other capacity and receiving proper compensation therefor.

Section 16. Advisory Directors. The Board of Directors may
appoint one or more advisory directors as it shall from time to time determine.
Each advisory director appointed shall hold office at the pleasure of the Board
of Directors. An advisory director shall be entitled, but shall have no
obligation, to attend and be present at the meetings of the Board of Directors,
although a meeting of the Board of Directors may be held without notice to any
advisory director and no advisory director shall be considered in determining
whether a quorum of the Board of Directors is present. An advisory director
shall advise and counsel the Board of Directors on the business and operations
of the Corporation as requested by the Board of Directors; however, an advisory
director shall not be entitled to vote on any matter presented to the Board of
Directors. An advisory director, in consideration of such person serving as an
advisory director, shall be entitled to receive from the Corporation such fees
for attendance at meetings of the Board of Directors as the Board shall from
time to time determine. In addition, an advisory director shall be entitled to
receive from the Corporation reimbursement for the reasonable expenses incurred
by such person in connection with the performance of such person's duties as an
advisory director.

ARTICLE IV

EXECUTIVE AND OTHER COMMITTEES

Section 1. Executive Committee. The Board of Directors may, by
resolution adopted by a majority of the entire Board, designate annually three
or more of its members to constitute members or alternate members of an
Executive Committee, which Committee shall have and may exercise, between
meetings of the Board, all the powers and authority of the Board in the
management of the business affairs of the Corporation, including, if such
Committee is so empowered and authorized by resolution adopted by a majority of
the entire Board, the power and authority to declare a dividend and to
authorize the issuance of stock, and may authorize the seal of the Corporation
to be affixed to all papers that may require it, except that the Executive
Committee shall not have such power or authority in reference to:

(a) amending the Certificate of Incorporation of the
Corporation;

(b) adopting an agreement of merger or consolidation
involving the Corporation;

(c) recommending to the stockholders the sale, lease or
exchange of all or substantially all of the property and assets of the
Corporation;

(d) recommending to the stockholders a dissolution of the
Corporation or a revocation of a dissolution;

(e) adopting, amending or repealing any Bylaw;

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<PAGE> 12
(f) filling vacancies on the Board or on any committee of
the Board, including the Executive Committee; or

(g) amending or repealing any resolution of the Board
which by its terms may be amended or repealed only by the Board.

The Board shall have power at any time to change the membership of the
Executive Committee, to fill all vacancies in it and to discharge it, either
with or without cause.

Section 2. Other Committees. The Board of Directors may, by
resolution adopted by a majority of the entire Board, designate from among its
members one or more other committees, each of which shall, except as otherwise
prescribed by law, have such authority of the Board as may be specified in the
resolution of the Board designating such committee. A majority of all the
members of such committee may determine its action and fix the time and place
of its meetings, unless the Board shall otherwise provide. The Board shall
have power at any time to change the membership of, to fill all vacancies in
and to discharge any such committee, either with or without cause.

Section 3. Procedure; Meetings; Quorum. Regular meetings of the
Executive Committee or any other committee of the Board of Directors, of which
no notice shall be necessary, may be held at such times and places as shall be
fixed by resolution adopted by a majority of the members thereof. Special
meetings of the Executive Committee or any other committee of the Board shall
be called at the request of any member thereof. Notice of each special meeting
of the Executive Committee or any other committee of the Board shall be sent by
mail, delivery service, facsimile telecommunication, telegraph or telephone, or
be delivered personally to each member thereof not later than the day before
the day on which the meeting is to be held, but notice need not be given to any
member who shall, either before or after the meeting, submit a signed waiver of
such notice or who shall attend such meeting without protesting, prior to or at
its commencement, the lack of such notice to such member. Any special meeting
of the Executive Committee or any other committee of the Board shall be a legal
meeting without any notice thereof having been given, if all the members
thereof shall be present thereat. Notice of any adjourned meeting of any
committee of the Board need not be given. The Executive Committee or any other
committee of the Board may adopt such rules and regulations not inconsistent
with the provisions of law, the Certificate of Incorporation of the Corporation
or these Bylaws for the conduct of its meetings as the Executive Committee or
any other committee of the Board may deem proper. A majority of the Executive
Committee or any other committee of the Board shall constitute a quorum for the
transaction of business at any meeting, and the vote of a majority of the
members thereof present at any meeting at which a quorum is present shall be
the act of such committee. The Executive Committee or any other committee of
the Board of Directors shall keep written minutes of its proceedings and shall
report on such proceedings to the Board.

ARTICLE V

OFFICERS

Section 1. Number; Term of Office. The officers of the
Corporation shall be a Chairman of the Board, a President, one or more Vice
Presidents, a Treasurer, a Secretary, a Controller, and such other officers or
agents with such titles and such duties as the Board of Directors may from time
to time determine, each to have such authority, functions or duties as in these
Bylaws provided or as the Board may from time to time determine, and each to
hold office for such term as may be prescribed by the

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<PAGE> 13
Board and until such person's successor shall have been chosen and shall
qualify, or until such person's death or resignation, or until such person's
removal in the manner hereinafter provided. The Chairman of the Board shall be
elected from among the directors. One person may hold the offices and perform
the duties of any two or more of said officers; provided, however, that no
officer shall execute, acknowledge or verify any instrument in more than one
capacity if such instrument is required by law, the Certificate of
Incorporation of the Corporation or these Bylaws to be executed, acknowledged
or verified by two or more officers. The Board may from time to time authorize
any officer to appoint and remove any such other officers and agents and to
prescribe their powers and duties. The Board may require any officer or agent
to give security for the faithful performance of such person's duties.

Section 2. Removal. Any officer may be removed, either with or
without cause, by the Board of Directors at any meeting thereof called for that
purpose, or, except in the case of any officer elected by the Board, by any
committee or superior officer upon whom such power may be conferred by the
Board.

Section 3. Resignation. Any officer may resign at any time by
giving notice to the Board of Directors, the President or the Secretary of the
Corporation. Any such resignation shall take effect at the date of receipt of
such notice or at any later date specified therein; and, unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make it effective.

Section 4. Vacancies. A vacancy in any office because of death,
resignation, removal or any other cause may be filled for the unexpired portion
of the term in the manner prescribed in these Bylaws for election to such
office.

Section 5. The President. The President shall be the chief
executive officer of the Corporation and as such shall have general supervision
and direction of the business and affairs of the Corporation, subject to the
control of the Board of Directors. The President shall, if present and in the
absence of the Chairman of the Board, preside at meetings of the stockholders,
meetings of the Board and meetings of the Executive Committee. The President
shall perform such other duties as the Board may from time to time determine.
The President may sign and execute in the name of the Corporation deeds,
mortgages, bonds, contracts or other instruments authorized by the Board or any
committee thereof empowered to authorize the same.

Section 6. Chairman of the Board. The Chairman of the Board
shall, if present, preside at meetings of the stockholders, meetings of the
Board and meetings of the Executive Committee. The Chairman of the Board shall
counsel with and advise the President and perform such other duties as the
President or the Board or the Executive Committee may from time to time
determine.

Section 7. Vice Presidents. Each Vice President shall have such
powers and duties as shall be prescribed by the President, the Chairman of the
Board or the Board of Directors. Any Vice President may sign and execute in
the name of the Corporation deeds, mortgages, bonds, contracts or other
instruments authorized by the Board or any committee thereof empowered to
authorize the same.

Section 8. Treasurer. The Treasurer shall perform all duties
incident to the office of Treasurer and such other duties as from time to time
may be assigned to the Treasurer by the President, the Chairman of the Board or
the Board of Directors.

Section 9. Secretary. It shall be the duty of the Secretary to
act as secretary at all meetings of the Board of Directors, of the Executive
Committee and of the stockholders and to record the

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<PAGE> 14
proceedings of such meetings in a book or books to be kept for that purpose;
the Secretary shall see that all notices required to be given by the
Corporation are duly given and served; the Secretary shall be custodian of the
seal of the Corporation and shall affix the seal or cause it to be affixed to
all certificates of stock of the Corporation (unless the seal of the
Corporation on such certificates shall be a facsimile, as hereinafter provided)
and to all documents, the execution of which on behalf of the Corporation under
its seal is duly authorized in accordance with the provisions of these Bylaws.
The Secretary shall have charge of the stock ledger and also of the other
books, records and papers of the Corporation and shall see that the reports,
statements and other documents required by law are properly kept and filed; and
the Secretary shall in general perform all the duties incident to the office of
Secretary and such other duties as from time to time may be assigned to such
person by the President, the Chairman of the Board or the Board of Directors.

Section 10. Controller. The Controller shall perform all of the
duties incident to the office of the Controller and such other duties as from
time to time may be assigned to such person by the President, the Chairman of
the Board or the Board of Directors.

Section 11. Assistant Treasurers, Secretaries and Controllers.
The Assistant Treasurers, the Assistant Secretaries and the Assistant
Controllers shall perform such duties as shall be assigned to them by the
Treasurer, Secretary or Controller, respectively, or by the President, the
Chairman of the Board or the Board of Directors.

ARTICLE VI

INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS

Section 1. Third Party Actions. The Corporation shall indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the Corporation), 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, partnership, joint venture, trust or other enterprise,
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 or not opposed to the best
interests of the Corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which such person reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his or her
conduct was unlawful.

Section 2. Derivative Actions. The Corporation shall indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
Corporation to procure a judgment in its favor 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, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense or settlement
of such action or suit if such person

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<PAGE> 15
acted in good faith and in a manner such person reasonably believed to be in or
not opposed to the best interests of the Corporation, except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Corporation
unless and only to the extent that the Court of Chancery of Delaware or the
court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery of Delaware or such
other court shall deem proper.

Section 3. Determination of Indemnification. Any
indemnification under Section 1 or 2 of this Article VI (unless ordered by a
court) shall be made by the Corporation only as authorized in the specific case
upon a determination that indemnification of the director, officer, employee or
agent is proper in the circumstances because such person has met the applicable
standard of conduct set forth in Section 1 or 2 of this Article VI. Such
determination shall be made (i) by a majority vote of the directors who are not
parties to such action, suit or proceeding, even though less than a quorum, or
(ii) if there are no such directors, or if such directors so direct, by
independent legal counsel in a written opinion, or (iii) by the stockholders.

Section 4. Right to Indemnification. Notwithstanding the other
provisions of this Article VI, to the extent that a director, officer, employee
or agent of the Corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in Section 1 or 2 of this
Article VI, or in defense of any claim, issue or matter therein, such person
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith.

Section 5. Advancement of Expenses. The Corporation shall pay
the expenses (including attorneys' fees) incurred in defending any civil,
criminal, administrative or investigative action, suit or proceeding in advance
of the final disposition of such action, suit or proceeding, provided, however,
that the payment of expenses incurred by a director, officer, employee or agent
in advance of the final disposition of the action, suit or proceeding shall be
made only upon receipt of an undertaking by or on behalf of the director,
officer, employee or agent to repay all amounts advanced if it should be
ultimately determined that such person is not entitled to be indemnified under
this Article VI or otherwise.

Section 6. Indemnification and Advancement of Expenses Not
Exclusive. The indemnification and advancement of expenses provided by, or
granted pursuant to the other Sections of this Article VI shall not be deemed
exclusive of any other rights to which any person seeking indemnification may
be entitled under any law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in such person's official capacity
and as to action in another capacity while holding such office. All rights to
indemnification under this Article VI shall be deemed to be provided by a
contract between the Corporation and the director, officer, employee or agent
who served in such capacity at any time while these Bylaws and other relevant
provisions of the Delaware General Corporation Law and other applicable law, if
any, are in effect. Any repeal or modification thereof shall not affect any
rights or obligations then existing.

Section 7. Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who 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,
partnership, joint venture, trust or other enterprise, against any liability
asserted against such person and incurred by such person in any such capacity,
or arising out of such person's status as such, whether or

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<PAGE> 16
not the Corporation would have the power to indemnify such person against such
liability under the applicable provisions of the Delaware General Corporation
Law.

Section 8. Definitions of Certain Terms. For purposes of this
Article VI, references to "the Corporation" shall include, in addition to the
resulting corporation, any constituent corporation (including any constituent
of a constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation, or is or
was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under the
provisions of this Article VI with respect to the resulting or surviving
corporation as such person would have with respect to such constituent
corporation if its separate existence had continued.

For purposes of this Article VI, references to "other enterprise"
shall include employee benefit plans; references to "fines" shall include any
excise tax assessed on a person with respect to any employee benefit plan; and
references to "serving at the request of the Corporation" shall include any
service as a director, officer, employee or agent of the Corporation that
imposes duties on, or involves services by, such director, officer, employee or
agent with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner such person
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the Corporation" as referred to in this
Article VI.

Section 9. Continuation and Successors. The indemnification and
advancement of expenses provided by, or granted pursuant to, this Article VI
shall, unless otherwise provided when authorized or ratified, continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person.

Section 10. Exclusive Jurisdiction. The Delaware Court of
Chancery is vested with exclusive jurisdiction to hear and determine all
actions for advancement of expenses or indemnification brought under this
Article VI or under any statute, agreement, vote of stockholders or
disinterested directors, or otherwise. The Delaware Court of Chancery may
summarily determine the Corporation's obligation to advance expenses (including
attorneys' fees).

ARTICLE VII

CAPITAL STOCK

Section 1. Certificates for Shares. Certificates representing
shares of stock of each class of the Corporation, whenever authorized by the
Board of Directors, shall be in such form as shall be approved by the Board.
The certificates representing shares of stock of each class shall be signed by,
or 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 or
the Treasurer or an Assistant Treasurer of the Corporation, and sealed with the
seal of the Corporation, which may be by a facsimile thereof. Any or all such
signatures may be facsimiles if countersigned by a transfer agent or registrar.
Although any officer, transfer agent or registrar whose manual or facsimile
signature is affixed to such a certificate ceases to be such officer, transfer
agent or registrar before such certificate has been issued, it may

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<PAGE> 17
nevertheless be issued by the Corporation with the same effect as if such
officer, transfer agent or registrar were still such at the date of its issue.

The stock ledger and blank share certificates shall be kept by the
Secretary or by a transfer agent or by a registrar or by any other officer or
agent designated by the Board.

Section 2. Transfer of Shares. Transfer of shares of stock of
each class of the Corporation shall be made only on the books of the
Corporation by the holder thereof, or by such holder's attorney thereunto
authorized by a power of attorney duly executed and filed with the Secretary of
the Corporation or a transfer agent for such stock, if any, and on surrender of
the certificate or certificates for such shares properly endorsed or
accompanied by a duly executed stock transfer power and the payment of all
taxes thereon. The person in whose name shares stand on the books of the
Corporation shall be deemed the owner thereof for all purposes as regards the
Corporation; provided, however, that whenever any transfer of shares shall be
made for collateral security and not absolutely, and written notice thereof
shall be given to the Secretary or to such transfer agent, such fact shall be
stated in the entry of the transfer. No transfer of shares shall be valid as
against the Corporation, its stockholders and creditors for any purpose, except
to render the transferee liable for the debts of the Corporation to the extent
provided by law, until it shall have been entered in the stock records of the
Corporation by an entry showing from and to whom transferred.

Section 3. Address of Stockholders. Each stockholder shall
designate to the Secretary or transfer agent of the Corporation an address at
which notices of meetings and all other corporate notices may be served or
mailed to such person, and, if any stockholder shall fail to designate such
address, corporate notices may be served upon such person by mail directed to
such person at such person's post office address, if any, as the same appears
on the share record books of the Corporation or at such person's last known
post office address.

Section 4. Lost, Destroyed and Mutilated Certificates. The
holder of any share of stock of the Corporation shall immediately notify the
Corporation of any loss, theft, destruction or mutilation of the certificate
therefor; the Corporation may issue to such holder a new certificate or
certificates for shares, upon the surrender of the mutilated certificate or, in
the case of loss, theft or destruction of the certificate, upon satisfactory
proof of such loss, theft or destruction; the Board of Directors, or a
committee designated thereby, or the transfer agents and registrars for the
stock, may, in their discretion, require the owner of the lost, stolen or
destroyed certificate, or such person's legal representative, to give the
Corporation a bond in such sum and with such surety or sureties as they may
direct to indemnify the Corporation and said transfer agents and registrars
against any claim that may be made on account of the alleged loss, theft or
destruction of any such certificate or the issuance of such new certificate.

Section 5. Regulations. The Board of Directors may make such
additional rules and regulations as it may deem expedient concerning the issue
and transfer of certificates representing shares of stock of each class of the
Corporation and may make such rules and take such action as it may deem
expedient concerning the issue of certificates in lieu of certificates claimed
to have been lost, destroyed, stolen or mutilated.

Section 6. Fixing Date for Determination of Stockholders of
Record. 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 entitled to receive payment of any dividend or other distribution
or allotment of any rights, or entitled to exercise any rights in respect of
any change, conversion or

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<PAGE> 18
exchange of stock or for the purpose of any other lawful action, the Board of
Directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted by the Board of
Directors, and which record date shall not be more than 60 nor less than 10
days before the date of such meeting, nor more than 60 days prior to any other
action. A determination of stockholders entitled to notice of or to vote at a
meeting of the 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.

ARTICLE VIII

SEAL

The Board of Directors may provide for a corporate seal bearing the
name of the Corporation in such form and bearing such other words or figures as
the Board of Directors may approve and adopt. The seal may be used by causing
it or a facsimile thereof to be impressed or affixed or in any other manner
reproduced.

ARTICLE IX

FISCAL YEAR

The fiscal year of the Corporation shall be fixed by resolution of the Board of
Directors.

ARTICLE X

WAIVER OF NOTICE

Whenever any notice whatsoever is required to be given by these
Bylaws, by the Certificate of Incorporation of the Corporation or by law, the
person entitled thereto may, either before or after the meeting or other matter
in respect of which such notice is to be given, waive such notice in writing,
which writing shall be filed with or entered upon the records of the meeting or
the records kept with respect to such other matter, as the case may be, and in
such event such notice need not be given to such person and such waiver shall
be deemed equivalent to such notice.

ARTICLE XI

AMENDMENTS

Any Bylaw (including this Article XI) may be adopted, repealed,
altered or amended at any meeting of the Board of Directors by the affirmative
vote of a majority of the directors, provided that such proposed action in
respect thereof shall be stated in the notice of such meeting. The
stockholders of the Corporation shall have the power to adopt, repeal, alter or
amend any provision of these Bylaws only to the extent and in the manner
provided in the Certificate of Incorporation of the Corporation.

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<PAGE> 19
ARTICLE XII

MISCELLANEOUS

Section 1. Execution of Documents. The Board of Directors or
any committee thereof shall designate the officers, employees and agents of the
Corporation who shall have power to execute and deliver deeds, contracts,
mortgages, bonds, debentures, notes, checks, drafts and other orders for the
payment of money and other documents for and in the name of the Corporation and
may authorize such officers, employees and agents to delegate such power
(including authority to redelegate) by written instrument to other officers,
employees or agents of the Corporation. Such delegation may be by resolution
or otherwise and the authority granted shall be general or confined to specific
matters, all as the Board or any such committee may determine. In the absence
of such designation referred to in the first sentence of this Section 1, the
officers of the Corporation shall have such power so referred to, to the extent
incident to the normal performance of their duties.

Section 2. Deposits. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
or otherwise as the Board of Directors or any committee thereof or any officer
of the Corporation to whom power in that respect shall have been delegated by
the Board or any such committee shall select.

Section 3. Checks. All checks, drafts and other orders for the
payment of money out of the funds of the Corporation, and all notes or other
evidence of indebtedness of the Corporation, shall be signed on behalf of the
Corporation in such manner as shall from time to time be determined by
resolution of the Board of Directors or of any committee thereof.

Section 4. Proxies in Respect of Stock or Other Securities of
Other Corporations. The Board of Directors or any committee thereof shall
designate the officers of the Corporation who shall have authority from time to
time to appoint an agent or agents of the Corporation to exercise in the name
and on behalf of the Corporation the powers and rights that the Corporation may
have as the holder of stock or other securities in any other corporation, and
to vote or consent in respect of such stock or securities; such designated
officers may instruct the person or persons so appointed as to the manner of
exercising such powers and rights; and such designated officers may execute or
cause to be executed in the name and on behalf of the Corporation and under its
corporate seal, or otherwise, such written proxies, powers of attorney or other
instruments as they may deem necessary or proper in order that the Corporation
may exercise its said powers and rights.

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<PAGE> 1
EXHIBIT 10.1

__________________________________________________

AGREEMENT OF LIMITED PARTNERSHIP

BRIGHAM OIL & GAS, L. P.

__________________________________________________

MAY 1, 1992
<PAGE> 2
AGREEMENT OF LIMITED PARTNERSHIP

<TABLE>
<S> <C>
ARTICLE I

Formation of Partnership
------------------------

Section 1.1. Formation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.3. Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.4. Registered Agent and Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.5. Names and Addresses of Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.6. Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.7. Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

ARTICLE II

Certain Definitions and References
----------------------------------

Section 2.1. Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 2.2. References and Titles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

ARTICLE III

Capitalization
--------------

Section 3.1. Capital Contributions of General Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 3.2. Capital Contributions of Limited Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 3.3. Payments of Capital Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 3.4. Non-payment of Capital Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3.5. Return of Capital Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.6. Payments and Advances by General Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.7. Preemptive Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3.8. Additional Issuances of Partnership Interests . . . . . . . . . . . . . . . . . . . . . . . . . 18

ARTICLE IV

Allocations and Distributions
-----------------------------

Section 4.1. Allocation of Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 4.2. Allocation of Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 4.3. Income Tax Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 4.4. Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
ARTICLE V

Partnership Property
--------------------

Section 5.1. Lease Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.2. Title to Partnership Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 5.3. Lease Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 5.4. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

ARTICLE VI

Management
----------

Section 6.1. Management Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.2. Major Decisions Requiring Management Committee Approval . . . . . . . . . . . . . . . . . . . . 31
Section 6.3. Officers and Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 6.4. Power and Authority of the Chief Executive Officer and
Managing General Partner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 6.5. Standard of Care of Chief Executive Officer and
Managing General Partner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 6.6. Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 6.7. Liability of General Partners and Others . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 6.8. Indemnification of Chief Executive Officer, General
Partners and Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 6.9. Costs, Expenses and Reimbursement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 6.10. Contracts With Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 6.11. Tax Elections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 6.12. Tax Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 6.13. Other Matters Concerning a General Partner . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 6.14. Confidentiality; Other Business of General Atlantic . . . . . . . . . . . . . . . . . . . . . 42

ARTICLE VII

Rights and Obligations of Limited Partners
------------------------------------------

Section 7.1. Rights of Limited Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 7.2. Limitations on Limited Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 7.3. Liability of Limited Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 7.4. Withdrawal and Return of Capital Contribution . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 7.5. Power of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
</TABLE>

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<PAGE> 4
<TABLE>
<S> <C>
ARTICLE VIII

Books, Records, Capital Accounts and Reports
--------------------------------------------

Section 8.1. Books and Records; Capital Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 8.2. Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 8.3. Data and Information Relating to Partnership . . . . . . . . . . . . . . . . . . . . . . . . . 47

ARTICLE IX

Assignments of Interests and Substitutions
------------------------------------------

Section 9.1. Assignments by Limited Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 9.2. Assignment by General Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 9.3. Apportionment Between Assignor and Assignee . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 9.4. Merger or Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 9.5. Right of First Offer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 9.6. Death of Carter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 9.7. Death of Carter's Spouse; Termination of Marital
Relationship; Partition of Community Property . . . . . . . . . . . . . . . . . . . 52
Section 9.8. Co-Sale Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

ARTICLE X

Registration Rights
-------------------

Section 10.1. Incidental Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 10.2. Required Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 10.3. Certain Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 10.4. Registration Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 10.5. Expenses; Limitations on Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 10.6. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

ARTICLE XI

Dissolution, Liquidation and Termination
----------------------------------------

Section 11.1. Dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 11.2. Liquidation and Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 11.3. Cancellation of Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
</TABLE>

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<PAGE> 5
<TABLE>
<S> <C>
ARTICLE XII

Representations and Warranties
------------------------------

Section 12.1. Representations and Warranties of Partners . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 12.2. Additional Representation and Warranty of Limited
Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 12.3. Additional Representations and Warranties of Brigham
and BEC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 12.4. Additional Covenants of General Atlantic. . . . . . . . . . . . . . . . . . . . . . . . . . . 67

ARTICLE XIII

Miscellaneous
-------------

Section 13.1. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 13.2. Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 13.3. Voting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 13.4. Partition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 13.5. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 13.6. No Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 13.7. Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 13.8. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 13.9. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 13.10. Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 13.11. Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 13.12. No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68

Exhibit A. Balance Sheet dated 1/1/92
Exhibit B. Liabilities Arising 1/1/92 through 4/30/92
Exhibit C. Litigation
Exhibit D. Producing Oil & Gas Properties
Exhibit E. Geophysical Exploration Agreements
Exhibit F. Employment Agreement (Ben M. Brigham)
Exhibit G. Consulting Agreement (Harold D. Carter)
Exhibit H. Unassigned Assets
</TABLE>

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<PAGE> 6
AGREEMENT OF LIMITED PARTNERSHIP

BRIGHAM OIL & GAS, L.P.

THIS AGREEMENT OF LIMITED PARTNERSHIP (herein called this "Agreement")
dated as of May 1, 1992, is made by and between Brigham Exploration Company
("BEC") and General Atlantic Partners III, L.P., a Delaware limited
partnership, as general partners (herein called the "General Partners"), and
Harold D. Carter, a Texas resident and GAP-Brigham Partners, L.P., a Delaware
limited partnership as limited partners (herein called the "Limited Partners").
In consideration of the mutual covenants and agreements contained herein, the
parties hereto agree as follows:

ARTICLE I

Formation of Partnership

Section 1.1. Formation. Subject to the provisions of this Agreement,
the parties hereto do hereby form a limited partnership (the "Partnership")
pursuant to the provisions of the Delaware Revised Uniform Limited Partnership
Act.

Section 1.2. Name. The name of the Partnership shall be Brigham Oil &
Gas, L.P.. Subject to all applicable laws, the business of the Partnership
shall be conducted in the name of the Partnership unless under the law of some
jurisdiction in which the Partnership does business such business must be
conducted under another name. In such a case, the business of the Partnership
in such jurisdiction may be conducted under such other name or names (including
the name of a General Partner) as the Chief Executive Officer shall determine
to be necessary. The Managing General Partner shall cause to be filed on behalf
of the Partnership such partnership or assumed or fictitious name certificate
or certificates or similar instruments as may from time to time be required by
law.

Section 1.3. Business. Subject to the other provisions of this
Agreement, the business of the Partnership shall be to: (a) acquire the
Business (as defined herein) and to acquire interests in other Leases (as
defined herein); (b) own, maintain and renew such Leases and other assets; (c)
explore, drill, develop and operate such Leases; (d) produce, collect, store,
treat, deliver, market, sell or otherwise dispose of oil, gas and related
hydrocarbons, minerals and other products from such Leases; (e) farmout, sell,
abandon and otherwise dispose of such Leases and other Partnership assets; (f)
obtain and market seismic data; and (g) take all such other actions incidental
to any of the foregoing as the General Partners may determine to be necessary
or desirable.

Section 1.4. Registered Agent and Office. The registered office of the
Partnership in the State of Delaware shall be The Corporation Trust Company,
Corporate Trust Center, 1209 Orange Street, Wilmington, Delaware, 19801 and the
registered agent for service of
<PAGE> 7
process on the Partnership shall be The Corporation Trust Company, a
corporation whose business address is the same as the Partnership's registered
office. The Managing General Partner, at any time and from time to time, may
change the Partnership's registered office or registered agent or both by
complying with the applicable provisions of the Act and giving concurrent
notice thereof to the other Partners and may establish, appoint and change
additional registered offices and registered agents of the Partnership in such
other states as the Managing General Partner shall determine to be necessary or
advisable.

Section 1.5. Names and Addresses of Partners. The names and mailing
addresses and street addresses of the General Partners are: Brigham Exploration
Company, 4925 Greenville Avenue, Suite 707, Dallas, Texas 75206, fax number:
(214) 691-6814, and General Atlantic Partners III, L.P., 125 East 56th Street,
New York, New York 10022, Attn: Stephen P. Reynolds, fax number: (212)
593-5192. The names and mailing addresses and street addresses of the Limited
Partners are: Harold D. Carter, 8080 North Central Expressway, Suite 400,
Dallas, Texas 75206, fax number: (214) 891-8056 and GAP-Brigham Partners, L.P.,
125 East 56th Street, New York, New York 10022, fax number: (212) 593-5192.

Section 1.6. Term. The Partnership shall be formed and commence upon
the completion of filing for record of an initial certificate of limited
partnership of the Partnership with the Secretary of State of the State of
Delaware and shall continue until terminated in accordance with Article XI.

Section 1.7. Filings. Upon the request of the Managing General
Partner, the other Partners shall promptly execute and deliver all such
certificates and other instruments conforming hereto as shall be necessary for
the Managing General Partner to accomplish all filing, recording, publishing
and other acts appropriate to comply with all requirements for the formation
and operation of a limited partnership under the laws of the State of Delaware
and for the qualification or reformation and operation of a limited partnership
(or a partnership in which the Limited Partners have limited liability) in all
other jurisdictions where the Partnership shall propose to conduct business.

ARTICLE II

Certain Definitions and References

Section 2.1. Certain Defined Terms. When used in this Agreement, the
following terms shall have the respective meanings assigned to them in this
Section 2.1 or in the sections and subsections referred to below:

-2-
<PAGE> 8
"Act" shall mean the Delaware Revised Uniform Limited Partnership Act,
as amended from time to time and any successor statute or statutes.

"Adjusted Capital Account" for any fiscal year shall mean, with
respect to each Partner, the Capital Account maintained for such Partner (a)
increased by (i) the amount of any unpaid Capital Contributions agreed to be
contributed by such Partner under Article III, if any, (ii) an amount equal to
such Partner's allocable share of Minimum Gain attributable to Partnership
Nonrecourse Liabilities, as computed on the last day of such fiscal year in
accordance with applicable Treasury Regulations, (iii) an amount equal to such
Partner's allocable share of Minimum Gain attributable to Partner Nonrecourse
Debt, as computed on the last day of such fiscal year in accordance with
applicable Treasury Regulations, and (iv) the amount of Partnership liabilities
allocable to such Partner under Section 752 of the Internal Revenue Code with
respect to which such Partner bears the economic risk of loss to the extent
such liabilities do not constitute Partner Nonrecourse Debt, and (b) reduced by
(i) the amount of all depletion deductions reasonably expected to be allocated
to such Partner in subsequent years and charged to such Partner's Capital
Account, (ii) the amount of all losses and deductions reasonably expected to be
allocated to such Partner in subsequent years under Sections 704(e)(2) and
706(d) of the Internal Revenue Code and Treasury Regulation Section
1.751-1(b)(2)(ii), and (iii) the amount of all distributions reasonably
expected to be made to such Partner to the extent they exceed offsetting
increases to such Partner's Capital Account that are reasonably expected to
occur during (or prior to) the year in which such distributions are reasonably
expected to be made under Treasury Regulation Section 1.704-2(f).

"Adjusted Carrying Value" should have the meaning assigned to it in
Section 4.3(c)(i).

"Affiliate" shall mean with respect to a Partner (a) any person
directly or indirectly owning, controlling or holding with power to vote 10% or
more of the outstanding voting securities of such Partner, (b) any person 10%
or more of whose outstanding voting securities are directly or indirectly
owned, controlled or held with power to vote by such Partner, (c) any person
directly or indirectly controlling, controlled by or under common control with
such Partner, and (d) any officer, director or partner of such Partner or any
person described in clause (c) of this paragraph. As used in this Agreement,
the term "person" shall include an individual, an estate, a corporation, a
partnership, an association, a joint stock company and a trust. The term
"controls", "is controlled by" and "under common control with" means the
possession of the power to direct or cause the direction of the management and
policies of a person, by virtue of ownership of voting securities. When the
term "Affiliate" is used in this Agreement to refer to persons to whom
transfers of interest in the Partnership by the GA Partners are permitted, such
term shall not include any person engaged in the oil and gas business.

"Agreed Rate" shall mean a rate per annum which is equal to the lesser
of (a) a rate which is two percent (2%) above the prime rate of interest of
Texas Commerce Bank

-3-
<PAGE> 9
National Association, Dallas Branch as announced or published by such bank from
time to time (adjusted from time to time to reflect any changes in such rate
determined hereunder) or (b) the maximum rate from time to time permitted by
applicable law.

"Aggregate Tax Amount" with respect to each Partner shall mean an
amount not less than zero equal to the excess of (i) the sum of all Tax Amounts
previously distributed to such Partner over (ii) the aggregate amount of all
distributions previously made to such Partner other than (a) amounts
distributed on account of such Partner's Net Capital Contribution and (b)
amounts distributed on account of such Partner's Tax Amount.

"Appraised Value" shall mean the pre-income tax value of projected net
revenues from oil and gas production from all Partnership Leases, calculated by
the Designated Engineers as of the first day of the calendar month in which a
determination of Appraised Value was requested by BEC, discounted at a 10%
discount rate and based on Agreed Pricing (as defined below); provided that,
for the purposes of determining such projected net revenues, only Proved
Developed Reserves, and such other categories of reserves as the Management
Committee shall approve (including the vote or consent of at least one GAP
Representative), shall be utilized. "Agreed Prices" shall be determined as
follows:

(a) For oil or gas subject to a contract which does not terminate
(and is not subject to termination) within 90 days after the
request is made for a determination of Appraised Value, the
"Agreed Price" for such oil or gas, until the earliest date
such contract will terminate (or can be terminated), shall be
the price provided for, from time to time, in such contract,
including all escalations of and adjustments to such price;
and

(b) Otherwise, for oil (i) for each of the twelve calendar months
beginning with the month following the month in which a
determination of Appraised Value is requested, there shall be
determined the average of the high and low price per barrel
for "light, sweet crude oil" futures contracts (the "Oil
Benchmark"), as quoted, on the date the determination of
Appraised Value is requested, for deliveries in such month (if
high and low prices are not quoted on such date for any such
month, the prices quoted for such month on the first day
following such date on which such prices for such month are
quoted will be used), and (ii) such average amount for each
such month, as so determined, shall be added together and
divided by 12, with the result of such computation being the
"Tentative Price" per barrel for oil, and (iii) for each
property for which a value is being determined for the
purposes of determining Appraised Value, such Tentative Price
shall be adjusted by the Management Committee to reflect the
historical variance between amounts actually received for oil
at the wellhead and the historical Oil Benchmark prices (such
Tentative Price as so adjusted being the "Agreed Price" for
oil produced from such property); and

-4-
<PAGE> 10
(c) Otherwise, for gas (i) for each of the twelve calendar months
beginning with the month following the month in which a
determination of Appraised Value is requested, there shall be
determined the average of the high and low price per MMBtu for
natural gas futures contracts at Henry Hub (the "Gas
Benchmark"), as quoted, on the date the determination of
Appraised Value is requested, for deliveries in such month (if
high and low prices are not quoted on such date for any such
month, the prices quoted for such month on the first day
following such date on which such prices for such month are
quoted will be used), and (ii) such average amount for each
such month, as so determined, shall be added together and
divided by 12, with the result of such computation being the
"Tentative Price" per MMBtu for gas, and (iii) for each
property for which a value is being determined for the
purposes of determining Appraised Value, such Tentative Price
shall be adjusted by the Management Committee to reflect the
historical variance between amounts actually received for gas
at the wellhead and the Gas Benchmark (such Tentative Price as
so adjusted being the "Agreed Price" for gas produced from
such property); or

(d) Such other prices as the Management Committee (including the
affirmative vote or consent of at least one GAP
Representative) may agree are appropriate.

"BEC" shall mean Brigham Exploration Company, a Texas corporation.

"Brigham" shall mean Ben M. Brigham.

"Brigham Representatives" shall have the meaning set forth in Section
6.1.

"Built-in Gain" shall have the meaning assigned to it in Section
4.3(c)(i).

"Business" shall have the meaning assigned to it in Section 3.1.

"Capital Account" shall have the meaning assigned to it in Section
8.1(b).

"Capital Contributions" shall mean for any Partner, as of any date, at
the particular time in question the aggregate of (i) the dollar amounts of any
cash contributed to the capital of the Partnership, or, if the context in which
such term is used so indicates, the dollar amounts of cash agreed to be
contributed, by such Partner to the capital of the Partnership, and (ii) the
fair market value (as agreed by the General Partners) of property contributed
by such Partner to the capital of the Partnership.

"Carter" shall mean Harold D. Carter, a Texas resident.

-5-
<PAGE> 11
"Chief Executive Officer" shall mean Brigham acting pursuant to the
Employment Agreement and as provided in this Agreement.

"Commission" shall mean the Securities and Exchange Commission and any
other similar or successor agency of the federal government then administering
the Securities Act or the Exchange Act.

"Conveyances" shall mean the BEC assignments of the assets of the
Business to the Partnership and the assumption by the Partnership of the
liabilities associated therewith.

"Depletable Property" shall have the meaning assigned to it in Section
4.3(b).

"Designated Engineers" shall mean a national recognized petroleum
engineering firm agreed to by the Management Committee (including the
affirmative vote or consent of at least one GAP Representative) to conduct the
valuation contemplated for the determination of Appraised Value or, in the
absence of agreement, Netherland & Sewell.

"Effective Date" shall mean May 1, 1992.

"Employment Agreement" shall mean the Employment Agreement by and
between the Partnership and Brigham in the form attached hereto as Exhibit F.

"Equity Securities" shall mean the general and/or limited partnership
interests held by the Partners in the Partnership, or in the event of a
conversion of the Partnership to corporate form, any capital stock into or for
which the partnership interests are converted or exchanged.

"Event of Default" shall have the meaning assigned to it in Section
3.4(c).

"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and any similar or successor federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time in question.

"GA Partners" shall mean General Atlantic and GAP L.P.

"GA Permitted Transferees" shall mean with respect to General Atlantic
or GAP-Brigham (a) General Atlantic Partners, a New York general partnership of
which the general partners are Edwin Cohen, Steven Denning, David Hodgson,
Stephen Reynolds and Michael Cline, provided that at the time in question more
than 50% of the outstanding voting securities of General Atlantic Partners are
owned by one or more of the individuals listed in this subsection (i); (ii)
Edwin Cohen, Steven Denning, David Hodgson, Stephen Reynolds, Michael Cline,
Alexis Cranberg, William Ford, William Grabe, David Golob, Stephen Hoey and
Patricia Hedley; (iii) General Atlantic Corporation, a Delaware

-6-
<PAGE> 12
corporation which is the limited partner of General Atlantic; (iv) any person
directly or indirectly owning, controlling or holding with power to vote 50% or
more of the outstanding voting securities of General Atlantic Corporation; (v)
any entity of which the persons described in subclauses (i) or (iii) hereof
directly or indirectly own, control or hold with power to vote 20% or more of
the outstanding voting securities of such entity; or (vi) any entity of which
the persons described in subclause (iv) own, control or hold with power to vote
an amount of the outstanding voting securities of such entity such that (A)
such amount of voting securities multiplied by (B) the amount of outstanding
voting securities of General Atlantic Corporation such person owns, controls or
holds with power to vote, equals 20%; provided, in the case of a GA Permitted
Transferee described in subclause (v) or (vi) hereof, such GA Permitted
Transferee irrevocably appoints General Atlantic the attorney and proxy of such
GA Permitted Transferee with full power of substitution to vote the interest in
the Partnership so transferred as General Atlantic may determine in its sole
discretion; and provided further, that in no event shall the term "GA Permitted
Transferee" include any person engaged in the oil and gas business.

"GAP L.P." shall mean GAP-Brigham Partners, L.P., a Delaware limited
partnership.

"GAP Representatives" shall have the meaning set forth in Section 6.1.

"General Atlantic" shall mean General Atlantic Partners III, L.P., a
Delaware limited partnership.

"General Atlantic Partners" shall mean General Atlantic Partners, a
New York general partnership, as constituted on the Effective Date.

"General Partners" shall mean Brigham Exploration Company, a Texas
corporation, General Atlantic Partners III, L.P., a Delaware limited
partnership, and any person who becomes a substituted general partner of the
Partnership pursuant to the terms hereof.

"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time, and any successor statute or statutes.

"Lease" shall mean a lease, mineral interest, royalty or overriding
royalty, fee right, license, concession or other right covering oil, gas and
related hydrocarbons (or a contractual right to acquire such an interest) or an
undivided interest therein or portion thereof, together with all appurtenances
thereto and servitudes associated therewith.

"Limited Partners" shall mean Carter and GAP L.P., and any person who
becomes an additional or a substituted Limited Partner of the Partnership
pursuant to the terms hereof.

"Major Decisions" shall mean those actions defined as such in Section
6.2.

-7-
<PAGE> 13
"Majority in Interest" as to any vote, consent or approval of the
Partners shall mean those Partners holding more than 50% of the Post Threshold
Ratio interests in the Partnership.

"Management Partners" shall have the meaning set forth in Section
6.1(d)(iv).

"Managing General Partner" shall mean Brigham Exploration Company, and
any successor Managing General Partner elected by the Management Committee
pursuant to the terms hereof.

"Minimum Gain" shall mean (i) with respect to Partnership Nonrecourse
Liabilities, the amount of gain that would be realized by the Partnership if it
disposed of (in a taxable transaction) all Partnership properties that are
subject to Partnership Nonrecourse Liabilities in full satisfaction of such
Partnership Nonrecourse Liabilities, computed in accordance with applicable
Treasury Regulations, or (ii) with respect to each Partner Nonrecourse Debt,
the amount of gain that would be realized by the Partnership if it disposed of
(in a taxable transaction) all Partnership properties that are subject to such
Partner Nonrecourse Debt in full satisfaction of such Partner Nonrecourse Debt,
computed in accordance with applicable Treasury Regulations.

"Net Capital Contribution" shall mean in the case of each of General
Atlantic and GAP L.P., the excess of the Capital Contributions made by each
such Partner under Sections 3.1 or 3.2, over the distributions to each such
Partner in excess of their respective Tax Amounts.

"Oil and Gas Interests" shall mean all Leases, interests therein,
options to acquire, reversionary interests, net profits interests, production
payments and other similar rights and interests and all rights in, to and under
all agreements, product purchase and sales contracts, exchange or processing
agreements, leases, permits, servitudes, rights-of-way, easements, licenses,
farmouts, farmins, bottom hole agreements, dry hole agreements, acreage
contribution agreements, processing agreements, options, orders and other
agreements and instruments relating thereto, and interests in and to all of the
personal property, fixtures and improvements thereon, appurtenant thereto or
used, held or obtained in connection with the Leases or the production,
treatment, sale or disposal of hydrocarbons or water or other substances
produced therefrom or attributable thereto.

"Organization Costs" shall mean (a) the fees and expenses of (i)
Thompson & Knight, as counsel to BEC and Brigham and (ii) Paul, Weiss, Rifkind,
Wharton & Garrison as counsel to General Atlantic (in an amount not to exceed
$60,000), incurred in connection with the preparation and execution of this
Agreement and all related documents and the preparation and filing of all
certificates, opinions and documents required pursuant to Sections 1.2 and 1.7
in connection with the initial organization and qualification of the
Partnership to do business, and (b) all out of pocket costs, fees and expenses
incurred by the

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Partnership or any of the Partners in connection with the filing of the
documents and certificates required for the formation and qualification to do
business of the Partnership.

"Partners" shall mean the General Partners and the Limited Partners.

"Partnership" shall have the meaning assigned to it in Section 1.1.

"Partnership Nonrecourse Debt" shall mean any nonrecourse debt of the
Partnership for which any Partner bears the economic risk of loss.

"Partnership Nonrecourse Liabilities" shall mean nonrecourse
liabilities (or portions thereof) of the Partnership for which no Partner bears
the economic risk of loss.

"Permitted Encumbrances" shall mean (a) those claims listed in
Exhibits A, B and C; (b) lessors' royalties, overriding royalties, and division
orders covering Leases or production therefrom; (c) preferential rights to
purchase and required third party consents, with respect to which (i) waivers
or consents are obtained by BEC prior to the Effective Date from the
appropriate parties (ii) the appropriate time period for asserting such rights
has expired prior to the Effective Date without an exercise of such rights, or
(iii) with respect to consents, such consent need not be obtained prior to an
assignment or failure to obtain such consent will not have a material adverse
effect on the value to the Partnership of the Oil and Gas Interests; (d) liens
for taxes or assessments not yet due or not yet delinquent or, if delinquent,
that are being contested in good faith in the normal course of business; (e)
easements, rights-of- way, servitudes, permits, surface leases and other rights
in respect of surface operations, pipelines, grazing, logging canals, ditches,
reservoirs or the like; conditions covenants or other restrictions; and
easements for streets, alleys, highways, pipelines, telephone lines, power
lines, railways and other easements and rights-of-way; on, over or in respect
of any of the Oil and Gas Interests that are not such as to interfere
materially with the operation, value or use of any portion of the Oil and Gas
Interests; (f) all other liens, charges, encumbrances, contracts, agreements,
instruments, obligations, defects and irregularities affecting any portion of
the Oil and Gas Interests (including without limitation, liens of operators
relating to obligations not yet due or pursuant to which BEC is not in default)
that are not such as to interfere materially with the operation, value or use
of any portion of the Oil and Gas Interests; and (g) rights reserved to or
vested in any municipality of governmental, tribal, statutory or public
authority to control or regulate any of the Oil and Gas Interests in any
manner, and all applicable laws, rules and orders of any municipality or
governmental or tribal authority.

"Permitted Transferees" of any person (and with respect to BEC, the
Permitted Transferees of Ben M. Brigham and Anne L. Brigham) shall mean (a)
such person's spouse, (b) such person's parents, (c) such person's natural and
adopted children and their spouses, (d) such person's siblings and their
spouses (provided, that in the case of the persons described in (a), (b), (c)
and (d) of this definition, such Permitted Transferee irrevocably

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appoints the transferring person, the attorney and proxy of such permitted
transferee with full power of substitution to vote the interest in the
Partnership so transferred as such transferring person may determine in its
sole discretion), (e) the trustee or trustees of a trust or trusts (the terms
of which are not inconsistent with this Agreement) at any time established for
the sole benefit of such person or one or more of the persons described in (a),
(b), (c) or (d) of this definition, or the trustee or trustees of a voting
trust or trusts all of the voting trust certificates of which are owned by such
person or one or more of the persons described in (a), (b), (c) or (d) of this
definition, (f) a partnership or partnership, all of the beneficial interest of
which is held by such person or one or more of the persons described in (a),
(b), (c), (d), (e) or (g) of this definition, (g) a corporation or
corporations, all of the voting stock of which is owned by such person or one
or more of the persons described in (a), (b), (c), (d), (e), (f) or (g) of this
definition, (h) with respect to BEC, its shareholders, or (i) after the tenth
anniversary of the Effective Date, if Threshold Value has been achieved, any
person or entity of which Ben M. Brigham and/or Anne L. Brigham own directly or
indirectly at least 50% of the outstanding voting securities.

"Proved Developed Reserves" shall mean Proved Reserves that can
expected to be recovered through existing wells with existing equipment and
operating methods. Additional oil and gas expected to be obtained through the
application of fluid injection or other improved recovery techniques for
supplementing the natural forces and mechanisms of primary recovery should be
included as Proved Developed Reserves only after testing by a pilot project or
after the operation of an installed program has confirmed through production
response that increased recovery will be achieved.

"Proved Reserves" of oil and gas shall be the estimated quantities of
crude oil, natural gas and natural gas liquids which geological, geophysical
and engineering data demonstrate with reasonable certainty to be recoverable in
future years from known reservoirs under existing economic and operating
conditions, i.e., prices and costs as of the date the estimate is made. Prices
include consideration of changes in existing prices provided only by
contractual arrangements, but not on escalations based on future conditions.
Reservoirs shall be considered proved if economic producibility is supported by
either actual production or conclusive formation tests. The area of a reservoir
considered proved shall be composed of (a) that portion delineated by drilling
and defined by gas-oil and/or oil-water contacts, if any, and (b) the
immediately adjoining portions not yet drilled, but which can be reasonably
judged as economically productive on the basis of available geological,
geophysical and engineering data. In the absence of information on fluid
contacts, the lowest known structural occurrence of hydrocarbons shall control
the lower proved limits of the reservoir.

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Proved reserves are estimates of hydrocarbons to be recovered from a given date
forward. They may be revised as hydrocarbons are produced and additional data
become available. Proved natural gas reserves are comprised of non-associated,
associated and dissolved gas. Reserves which can be produced economically
through application of improved recovery techniques (such as fluid injection)
shall be included in the proven classification when successful testing by a
pilot project, or the operation of an installed program in the reservoir,
provides support for the engineering analysis on which the project or program
was based. Improved recovery includes all methods for supplementing natural
reservoir forces and energy, or otherwise increasing ultimate recovery from a
reservoir, including (1) pressure maintenance, (2) cycling, and (3) secondary
recovery in its original sense. Improved recovery also includes the enhanced
recovery methods of thermal, chemical flooding, and the use of miscible and
immiscible displacement fluids. Estimates of proved reserves shall not include
the following: (i) oil that may become available from known reservoirs but are
or should be separately classified as "indicated additional reserves"; (ii)
crude oil, natural gas and natural gas liquids, the recovery of which is
subject to reasonable doubt because of uncertainty as to geology, reservoir
characteristics, or economic factors; (iii) crude oil, natural gas and natural
gas liquids that may occur in undrilled prospects; and (iv) crude oil, natural
gas and natural gas liquids that may be recovered from oil shales, coal,
gilsonite and similar other sources.

"Representative" and "Representatives" shall have the meanings set
forth in Section 6.1.

"Securities Act" shall mean the Securities Act of 1933, as amended,
and any similar or successor federal statute, and the rules and regulations
thereunder, all as the same shall be in effect at the time in question.

"Simulated Basis" shall have the meaning assigned to it in Section
8.1(b).

"Simulated Depletion" shall have the meaning assigned to it in Section
8.1(b).

"Simulated Gain" shall have the meaning assigned to it in Section
8.1(b).

"Simulated Loss" shall have the meaning assigned to it in Section
8.1(b).

"Tax Amount" shall have the meaning assigned to such term in Section
4.4.

"Threshold Value" shall mean $70 million computed and adjusted as
herein provided; provided, however, that Threshold Value must be achieved on or
before the date which is five years from the receipt of payment by the GA
Partners of their initial Capital Contributions pursuant to Sections 3.1(b) and
3.2. Threshold Value shall be achieved if, and only if, at the time of
determination, one of the following amounts equals or exceeds $70 million
(adjusted as provided in the following sentence): (a) The sum of (i) the
Partnership's

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<PAGE> 17
net book value (as audited per generally accepted accounting principles) plus
(ii) the excess or shortfall of the Appraised Value over the net book value of
the Partnership's Proved Developed Reserves; (b) the cash portion of the sale
price that an offeror has agreed to pay pursuant to a valid and binding
agreement to purchase the entire Partnership or all of the Partners' interests
therein; (c) the public market value of the Partnership's Equity Securities as
traded on an established securities exchange (assuming at least twenty-five
percent of such Equity Securities are publicly owned) and as determined by
reference to the average closing price for the Partnership's Equity Securities
reported for the 10 trading days prior to the date on which the Threshold Value
is determined; (d) the value of a bona fide unconditional offer from a capable
willing buyer for all or substantially all of the Partnership's assets or all
or substantially all of the Partners' interest in the Partnership for cash or
for equity securities of such buyer provided that such buyer's equity
securities are listed on a national securities exchange and have a public
market value greater than $100,000,000 (prior to completing such transaction);
or (e) such other amount as may be mutually agreed to in writing by General
Atlantic and BEC. The Threshold Value shall be reduced by any cash
distributions made to the Partners, in excess of the Tax Amounts, and shall be
increased for any increase in the Partnership's equity attributable to the
issuance of any additional Equity Securities for cash on a proportionate basis
so that after so adjusting the Threshold Value for such equity issuance the new
Threshold Value shall equal (A) the Threshold Value at the time of such
issuance of additional Equity Securities divided by (B) one (1) minus the
percentage of the total interest in the Partnership sold as a result of such
issuance of additional Equity Securities. The Appraised Value of the
Partnership's Proved Developed Reserves shall be prepared based on a report
prepared by the Designated Engineers.

"Transfer" shall mean any disposition or offer to dispose of any
Equity Securities, or any interest therein, which would constitute a sale of or
an offer to sell such Equity Securities or any such interest within the meaning
of the Securities Act.

Section 2.2. References and Titles. All references in this Agreement
to articles, sections, subsections and other subdivisions refer to
corresponding articles, sections, subsections and other subdivisions of this
Agreement unless expressly provided otherwise. Titles appearing at the
beginning of any of such subdivisions are for convenience only and shall not
constitute part of such subdivisions and shall be disregarded in construing the
language contained in such subdivisions. The words "this Agreement", "this
instrument", "herein", "hereof", "hereby", "hereunder" and words of similar
import refer to this Agreement as a whole and not to any particular subdivision
unless expressly so limited. Words in the singular form shall be construed to
include the plural and vice versa, unless the context otherwise requires.

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ARTICLE III

Capitalization

Section 3.1. Capital Contributions of General Partners.

(a) (i) BEC shall contribute on the Effective Date to the capital
of the Partnership its right, title and interest in and to all assets owned by
BEC on such date and used in or which relate to the conduct of BEC's business
prior to formation of the Partnership, including without limitation, the assets
listed or described on Exhibits A, D and E hereto (the "Business"), subject to
all existing mortgages, deeds of trust, liens, security interests, pledges,
leases, claims, charges, liabilities, obligations, agreements, privileges,
easements, rights-of-way, limitations, reservations, restrictions and other
encumbrances, including those disclosed in Exhibits A, B and C, the Permitted
Encumbrances and all obligations of BEC (including without limitation,
obligations to make assignments of interests in certain properties to third
parties) under the agreements listed in Exhibit E and (ii) the Partnership
shall assume and agree to perform all liabilities and obligations of BEC
related to the Business. It is agreed that the net fair market value of such
assets, subject to such liabilities and obligations, is $2,000,000, and BEC
shall receive a credit to its Capital Account for such Capital Contribution.
BEC shall execute and deliver the Conveyances and take such other action as may
be necessary or desirable to convey, assign, transfer to or vest in the
Partnership title and possession to such assets, which assignment shall be
effective for all purposes as of the Effective Date. The Partnership shall
execute and deliver to BEC the Conveyances evidencing its agreement to assume
and perform such liabilities and obligations. In addition, the Partners will
prepare and execute a statement of the breakdown of the net fair market value
attributable to the assets of the Business within 30 days of the Effective
Date. The Partnership further agrees to indemnify BEC for any state and federal
tax liability it may incur with respect to income from the Business for the
time frame beginning April 1 through April 30, 1992 up to a maximum amount of
$10,000. Attached hereto are: Exhibit A, which is a balance sheet dated January
1, 1992 for the Business indicating liabilities associated therewith; Exhibit B
indicating liabilities arising during the period from January 1, 1992 through
April 30, 1992; Exhibit C containing a schedule of existing litigation; Exhibit
D listing producing oil and gas properties of the Business; and Exhibit E
listing geophysical exploration agreements of the Business. In the event it is
later discovered that the known liabilities of the Business as of May 1, 1992
include liabilities other than the Permitted Encumbrances and other than those
disclosed in Exhibits A, B and C or those arising in the ordinary course of
business under agreements included in the assets of the Business and such
liabilities exceed $100,000 in the aggregate, the capital account of BEC shall
be reduced by the full dollar amount of such additional liabilities.

(b) General Atlantic shall contribute in cash to the Partnership
$9,545,000 of which $954,500 shall be paid on the Effective Date and the
remainder of which shall be paid

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to the Partnership by General Atlantic from time to time in the appropriate
amounts called for by the Chief Executive Officer in accordance with Section
3.3.

Section 3.2. Capital Contributions of Limited Partners. Subject to the
provisions of this Section 3.2, Carter shall contribute $100 to the capital of
the Partnership on the Effective Date. Such aggregate amount shall be the
maximum contribution to the Partnership that Carter shall be required to make.
GAP L.P. shall contribute in cash to the Partnership a maximum aggregate amount
equal to $455,000 of which $45,500 shall be paid on the Effective Date and the
remainder of which shall be paid to the Partnership by GAP L.P. to the
Partnership from time to time in the appropriate amounts called for by the
Chief Executive Officer in accordance with Section 3.3.

Section 3.3. Payments of Capital Contributions. The Chief Executive
Officer shall cause to be prepared and delivered to General Atlantic and GAP
L.P. 10 business days prior to the end of each fiscal quarter of the
Partnership an estimate of the amount of aggregate Capital Contributions
expected to be called and paid by the GA Partners (the "GA Call Amount") within
the succeeding quarter, together with a brief explanation of the bases for such
projected capital needs by the GA Partners. Up to $5,000,000 of such Capital
Contributions (including the initial Capital Contributions made by the GA
Partners) may be called during the first twelve months of the Partnership term
and the remaining $5,000,000, plus any portion of the $5,000,000 not previously
called, may be called at any time thereafter. Except as otherwise provided
herein, General Atlantic and GAP L.P. shall pay their proportionate shares of
the GA Call Amount (which as of the Effective Date are 95.45% and 4.55%,
respectively) until each such Partner has fulfilled its obligation to make its
respective Capital Contributions agreed to in Section 3.1 or 3.2, as
applicable, upon request by the Chief Executive Officer. Any request for
payment by the GA Partners of all or a portion of a GA Call Amount shall be in
writing and shall set forth (a) the amount of such Capital Contributions to be
paid by the respective GA Partners at such time and (b) the date by which
payment of such Capital Contributions shall be received, which (i) with respect
to any call for a Capital Contribution which alone or in the aggregate with all
other Capital Contributions made by the GA Partners during such fiscal quarter
does not exceed the estimate for such quarter, shall not be less than ten (10)
business days from the date the notice is received, and (ii) with respect to
any call for a Capital Contribution which alone or in the aggregate with all
other Capital Contributions made by the GA Partners during such fiscal quarter
exceeds the estimate for such quarter, shall be not less than 30 calendar days
from the date the notice is sent. Payments by the GA Partners of their Capital
Contributions shall be made by wire transfer of immediately available funds to
the Partnership's account as designated by the Chief Executive Officer by
notice to the GA Partners pursuant to Section 13.1.

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Section 3.4. Non-payment of Capital Contributions.

(a) In the event that a Partner fails or refuses to make when due
its share of Capital Contributions, and if such failure is on the part of
General Atlantic, at the time of such default, neither BEC with respect to this
Agreement nor Brigham with respect to the Employment Agreement, is in material
default hereunder, then the Partnership shall have the right to pursue one or
more of the remedies described in this Section 3.4 and any remedy existing at
law or in equity for the collection of the unpaid amount of the Capital
Contributions agreed to be made in Sections 3.l and 3.2, including without
limitation the prosecution of a suit against a defaulting Partner.

(b) In the event that General Atlantic should fail or refuse to
pay when due a call of its Capital Contributions under Section 3.1(b) as
requested pursuant to Section 3.3 and (i) (A) with respect to the first such
default such payment remains unpaid for 35 calendar days from the date due or
(B) with respect to any subsequent default such payment remains unpaid for 20
calendar days from the date due and (ii) at the time of such default neither
BEC, with respect to this Agreement, nor Brigham with respect to the Employment
Agreement, is in material default thereunder, then (1) the Threshold Amount
shall be deemed to have been reached, (2) General Atlantic's interest in the
Partnership shall be reduced by a percentage equal to 100 times a fraction, the
numerator of which shall equal $9,545,000 minus the aggregate amount of all
Capital Contributions theretofore made by General Atlantic, and the denominator
of which shall equal $9,545,000 and (3) the GAP Representatives shall have no
rights as to approval of Major Decisions until such amounts have been paid
together with any interest thereon at the Agreed Rate and costs of collecting
same; provided that rights to approve Major Decisions shall not be restored on
future payment of overdue amounts if such amounts are not paid within 45 days
of the due date. Notwithstanding the foregoing, if at any time General Atlantic
has not paid a capital call pursuant to Section 3.3 and such amount remains
unpaid for five business days after the due date, General Atlantic shall lose
its right to approve Major Decisions in Section 6.2(a) until such default has
been cured.

(c) In the event that a Partner fails or refuses to make when due
its share of Capital Contributions, and if such failure is on the part of
General Atlantic, at the time of such default, neither BEC with respect to this
Agreement, nor Brigham with respect to the Employment Agreement, is in material
default hereunder, then either General Partner shall be entitled to make such
Capital Contributions to the Partnership which the defaulting Partner is
obligated to make and the amount so advanced shall be treated as a loan from
the General Partner making such advance to such Partner and shall bear interest
from the date of such advance at a rate equal to the Agreed Rate. Such General
Partner shall notify the defaulting Partner of any such advance and request
payment by it of the amount so advanced, together with interest thereon from
the date of the advance. If the defaulting Partner fails or refuses to pay to
the advancing General Partner the amount so advanced, together with interest
thereon from the date of the advance, and if the failure or refusal

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persists for a period of 30 days following notice from the advancing General
Partner to the defaulting Partner (such occurrence being called herein an
"Event of Default"), the advancing General Partner shall be entitled to proceed
under this Section 3.4(c). In addition to the rights in Section 3.4(a), each
Partner hereby grants to the Partnership a lien upon and security interest in
such Partner's interest in the Partnership and in or to all assets attributable
to and proceeds of and from such interest in the Partnership to secure the
payment of contributions required under this Agreement, and authorizes the
Managing General Partner, upon the occurrence of an Event of Default, if it
elects to proceed under this alternative, to foreclose such lien or security
interest in any manner provided for by the laws of the State of Delaware for
the foreclosure of such lien or security interest (including without limitation
the exercise of the rights of a secured party under the Delaware Uniform
Commercial Code). If the Managing General Partner elects this alternative, the
defaulting Partner shall be liable for all costs and expenses of the Managing
General Partner in instituting and prosecuting such suit or foreclosing such
lien or security interest, including (without limitation) all reasonable
attorneys' fees expended in connection therewith. Each Partner hereby agrees
that the Managing General Partner may file one or more financing statements
with respect to the security interest granted hereby in order to perfect such
security interest, and each Partner hereby agrees to execute such financing
statements at the request of the Managing General Partner. Each Partner further
hereby appoints the Managing General Partner as its agent and attorney-in-fact
for the purpose of signing and filing any such financing statements, which
appointment is coupled with an interest and expressly made irrevocable. In the
event of a non-judicial foreclosure, the proceeds of the disposition of the
Partnership interest of the defaulting Partner shall be applied as follows: (i)
first, to the reasonable expenses incurred by the Partnership in collecting
such proceeds; and (ii) next, to the satisfaction of the Capital Contribution
which the defaulting Partner failed to make. The defaulting Partner shall be
liable for any deficiency, and the Managing General Partner shall account to
the defaulting Partner for any surplus. Any purchaser of the defaulting
Partner's interest in the Partnership shall assume the obligations of such
defaulting Partner under this Agreement and shall succeed to the right of such
defaulting Partner as to the allocation of profits and losses of, and as to
distributions from, the Partnership thereafter. Each Partner hereby grants the
Managing General Partner an irrevocable special power of attorney, coupled with
an interest, which shall survive the dissolution, bankruptcy, or legal
disability of such Partner, to take all actions necessary on its behalf to
sell, assign or transfer the Partnership interest of such Partner to such
person or persons as shall acquire such Partnership interest as provided in
this Section 3.4(c) should an Event of Default be deemed to have occurred with
respect to such Partner. In the event that the Managing General Partner elects
to foreclose upon a defaulting Partner's interest in the Partnership, the
Partners agree that 30 days prior notice shall be reasonable notice of any
proposed public or private foreclosure sale. Notwithstanding the foregoing, the
Managing General Partner shall not foreclose upon the interest of a defaulting
Partner in the Partnership if the Event of Default giving rise to the exercise
of remedies under this Section 3.4 arises out of a bona fide dispute regarding
the interpretation or implementation of this Agreement.

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(d) In the event that a Partner fails or refuses to make when due
its share of Capital Contributions, and if such failure is on the part of
General Atlantic, at the time of such default, neither BEC with respect to this
Agreement, nor Brigham with respect to the Employment Agreement, is in material
default hereunder, then the Partnership may retain any revenues otherwise
distributable to a Partner pursuant to this Agreement in an amount equal to the
amount such Partner failed or refused to contribute as required pursuant to the
terms of this Agreement, together with interest on such past-due amounts at a
rate equal to the Agreed Rate. Any amount so withheld shall be deemed, for all
purposes of this Agreement, to have been distributed to the Partner and, other
than that portion of such amounts representing interest, be deemed to have been
recontributed by the Partner to the capital of the Partnership for the purposes
for which contributions were initially requested. To the extent that a General
Partner has advanced funds to the Partnership as a result of the default of a
Partner, such General Partner shall be entitled to be reimbursed from the
amounts so withheld from the defaulting Partner in accordance with this Section
3.4.

(e) If any dispute as to whether an Event of Default existed is
resolved in favor of the purported defaulting Partner, then the advancing
General Partner shall pay to the Partnership for distribution to the purported
defaulting Partner an amount equal to any amounts wrongly paid by the
Partnership to the advancing General Partner (which should have instead been
paid by the Partnership to the defaulting Partner), or any amounts distributed
by the Partnership to such General Partner instead of to the purported
defaulting Partner, in connection with such Event of Default together with
interest thereon at a rate equal to the Agreed Rate, and all costs and expenses
of the purported defaulting Partner in resolving such dispute, including
(without limitation) all attorneys' fees expended in connection therewith.

(f) The advancing General Partner shall give notice of its
election of the alternatives listed above to the defaulting Partner, and if the
advancing General Partner elects the alternative provided under Section 3.4(a),
3.4(b) and/or Section 3.4(c), the advancing General Partner shall be free at
any time also to proceed under Section 3.4(d).

Section 3.5. Return of Capital Contributions. Except as provided in
Sections 3.4 and 3.6, no interest shall accrue on any contributions to the
capital of the Partnership; and no Partner shall have the right to withdraw or
be repaid any capital contributed by such Partner except as otherwise
specifically provided in this Agreement.

Section 3.6. Payments and Advances by General Partners. The General
Partners shall have the right to pay any indebtedness or obligation of the
Partnership out of funds of the General Partners, and may bill the Partnership
in the same manner that the Partnership may bill the Partners. Further, if at
any time a General Partner advances funds to or on behalf of the Partnership or
a General Partner is required to pay any indebtedness or obligation of the
Partnership in excess of the Capital Contributions of such General Partner
agreed to be made in this Article III, such advance or payment shall constitute
a loan by

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such General Partner to the Partnership. Such advance or payment shall
thereafter bear interest at a rate equal to the lesser of (a) the maximum
contract rate permitted by applicable law, (b) the effective rate of interest
then being paid by such General Partner for funds acquired by such General
Partner to pay such advance or payment (adjusted from time to time to reflect
any changes in such applicable rate) or (c) the amount which an unrelated bank
would charge the Partnership (without reference to such General Partner's
financial abilities or guarantees) on a comparable loan for the same purpose.
No such advance or payment by a General Partner shall be deemed to be a
contribution by such General Partner to the capital of the Partnership. Any
loan made by such General Partner hereunder to pay any costs or expenses
allocated and charged to any other Partner shall be repaid (with payments to be
applied first to the payment of interest and then to the repayment of
principal) from the revenues that would otherwise be next distributed to such
Partner hereunder.

3.7. Preemptive Rights. In the event the Partnership proposes to issue
or sell any general or limited partnership interests, or any obligation,
evidence of indebtedness or other security of the Partnership which is
convertible into or exchangeable for an interest in the Partnership or to which
shall be attached or appertain any warrant, option or other instrument or right
entitling the owner or holder thereof to subscribe for, purchase or receive
interests in the Partnership, or any warrant, option or right to subscribe for,
purchase or receive any such interests, obligation, evidence of indebtedness or
other security of the Partnership (all of the foregoing being in this Section
3.7 herein called "equity securities"), each Partner of the Partnership at the
time such equity securities are to be issued or sold shall have the preemptive
and preferential right to purchase, subscribe for or receive such equity
securities in the same respective proportion that the Post Threshold Ratio
interest owned by it bears to the total Post Threshold Ratio interests of all
Partners having the right granted by this Section 3.7. The foregoing preemptive
and preferential right to purchase, subscribe for or receive such equity
securities shall extend to any and all equity securities issued or sold by the
Partnership, except (i) securities issued to employees of the Partnership
pursuant to approval by the affirmative vote of the Management Committee or
when authorized by and consistent with an employee incentive or other
compensation plan theretofore approved by the Management Committee, (ii)
securities sold otherwise than for cash, and (iii) any securities sold in or at
any time after an initial public offering of securities by the Partnership (or
a successor entity). Such right shall be only an opportunity to acquire such
equity securities under such terms and conditions as the Management Committee
may fix for the purpose of providing a fair and reasonable opportunity for the
exercise of such right.

3.8. Additional Issuances of Partnership Interests.

(a) Subject in all respects to Section 6.2, in order to raise
additional capital or to acquire additional oil and gas interests or other
assets, to redeem or retire Partnership debt, to adopt fringe benefit plans for
employees in accordance with subsection (b) below, or for

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other valid Partnership purposes, the Partnership is authorized at any time and
from time to time to issue additional equity interests in the Partnership and
the Managing General Partner is authorized to admit any persons not already
Partners to the Partnership as additional partners without any consent or
approval of the other Partners.

(b) Subject in all respects to Section 6.2, the Partnership may adopt
fringe benefit plans, including plans involving the issuance of Partnership
interests, for the benefit of employees of the Partnership in respect of
services performed, directly or indirectly, for the benefit of the Partnership.

(c) Any such Partnership interests to be issued may be issued in one
or more classes, one or more series of such classes, for such consideration and
on such terms and conditions as the Management Committee in good faith
determines to be in the best interests of the Partnership, which classes or
series of Partnership interests shall have such designations, preferences and
relative, participating, optional or other special rights as shall be fixed by
the Management Committee.

(d) The Limited Partners shall have no approval rights with
respect to any such issuances of additional Equity Securities.

ARTICLE IV

Allocations and Distributions

Section 4.1. Allocation of Costs. All costs of the Partnership shall
be allocated and charged to the Partners as follows:

(a) For all fiscal years prior to the fiscal year in which
Threshold Value is achieved, all Partnership costs shall be allocated and
charged 94.4955% to General Atlantic, 4.5045% to GAP L.P., .917% to BEC and
.083% to Carter.

(b) For the fiscal year in which Threshold Value is achieved, and
in all subsequent years, all Partnership costs shall be allocated and charged
among the Partners in such amounts as shall be required to cause as soon as
possible the Capital Accounts of the Partners to be in proportion to their
respective Post Threshold Ratios, after first taking into account the
allocation of revenues for such period as provided in Section 4.2 and
distributions pursuant to Section 4.4. Thereafter, all such costs shall be
allocated and charged to the Partners in proportion to their respective Post
Threshold Ratios.

(c) Notwithstanding the foregoing provisions of this Section 4.1,
costs paid with proceeds of a Partner Nonrecourse Debt shall be allocated and
charged to the Partners in

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<PAGE> 25
proportion to the ratio in which the Partners bear the economic risk of loss
for such Partner Nonrecourse Debt.

(d) With respect to property contributed to the Partnership by
BEC, the basis in such property shall be allocated to BEC and Section 4.3(c)
shall govern the allocation of income, gain, deduction and loss computed by
reference to such basis.

Section 4.2. Allocation of Revenues. All revenues of the Partnership
(which shall not include Capital Contributions and loans to the Partnership)
shall be allocated and credited to the Partners as follows:

(a) All revenues resulting from the sale or other disposition of
Depletable Property shall be allocated, to the extent such revenues constitute
a recovery of Simulated Basis of such Depletable Property, to the Partners in
the same percentages as the Simulated Basis in such Depletable Property was
allocated up to an amount equal to each Partner's share of such Simulated Basis
at the time of such sale. Thereafter, revenues resulting from any such sale or
disposition shall be allocated to the Partners as provided in subsection (b) of
this Section 4.2.

(b) All other Partnership revenues shall be allocated as follows:

(i) For all fiscal years prior to the fiscal year in
which Threshold Value is achieved, all such other revenues shall be
allocated and credited 94.4955% to General Atlantic, 4.5045% to GAP
L.P., .917% to BEC and .083% to Carter until the Capital Accounts of
General Atlantic and GAP L.P., in the aggregate, equal the sum of the
Net Capital Contributions of both such Partners after first taking
into account the allocation of costs for such period as provided in
Section 4.1 and distributions pursuant to Section 4.4; then to the
Capital Accounts of the Partners as shall be required to cause as soon
as possible the Capital Accounts of BEC and Carter and the excess of
the Capital Accounts of General Atlantic and GAP L.P. over their
respective Net Capital Contributions to be in proportion to their
respective Post Threshold Ratios. Thereafter, all such other revenues
shall be allocated and credited to the Partners in proportion to their
respective Post Threshold Ratios.

(ii) For the fiscal year in which Threshold Value is
achieved, and for all subsequent fiscal years, all such other revenues
shall be allocated and credited to the Capital Accounts of the
Partners as shall be required to cause as soon as possible the Capital
Accounts of the Partners to be in proportion to their respective Post
Threshold Ratios. Thereafter, all such other revenues shall be
allocated and credited to the Partners in proportion to their
respective Post Threshold Ratios.

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<PAGE> 26
Section 4.3. Income Tax Allocations. Except as otherwise provided
herein, for purposes of any applicable federal, state or local income tax law,
rule or regulations items of income, gain, deduction, loss and credit shall be
allocated to the Partners as follows:

(a) Income from the sale of oil or gas production shall be
allocated in the same manner as revenue is allocated and credited pursuant to
Section 4.2(b).

(b) Cost and percentage depletion deductions and the gain or loss
on the sale or other disposition of property the production from which is or
would be (in the case of nonproducing properties) subject to depletion (herein
sometimes called "Depletable Property") shall be computed separately by the
Partners rather than the Partnership. For purposes of Section 613A(c)(7)(D) of
the Internal Revenue Code, the Partnership's adjusted basis in each Depletable
Property shall be allocated to the Partners in proportion to each Partner's
respective share of the costs that entered into the Partnership's adjusted
basis for each Depletable Property (or in the case of contributed property, in
proportion to each Partner's share of the basis in such property at the time of
contribution), and the amount realized on the sale or other disposition of each
Depletable Property shall be allocated to the Partners in proportion to each
Partner's respective share of the revenue from the sale or other disposition of
such Depletable Property provided for in Section 4.2. For purposes of
allocating amounts realized upon any such sale or disposition that are deemed
to be received for federal income tax purposes and that are attributable to
Partnership indebtedness or indebtedness to which the Depletable Property is
subject at the time of such sale or disposition, such amounts shall be
allocated in the same manner as Partnership revenues used for the repayment of
such indebtedness would have been allocated under Section 4.2.

(c) With respect to the property contributed by BEC, items of gain,
loss and deduction shall be allocated, solely for federal income tax purposes,
as follows:

(i) Any gain resulting from the sale or other disposition
of such property shall be allocated to BEC as required under Section
704(c) of the Internal Revenue Code up to an amount equal to the
Built-in Gain. Any gain in excess of the Built-in Gain shall be
allocated as otherwise provided in this Section 4.3. For purposes of
this paragraph (i), the "Built-in Gain" for each property contributed
by BEC shall be the excess of the Adjusted Carrying Value of such
property at any point in time over its adjusted tax basis at such
time. The "Adjusted Carrying Value" shall initially be the fair market
value of such property as agreed upon by the Partners in accordance
with Section 3.1(a), but shall be reduced by depletion, depreciation,
amortization, or loss with respect to such property computed in the
same manner as provided in Section 8.1(b) for purposes of charging the
Partner's Capital Accounts. In the case of any Depletable Property
contributed by BEC, the Simulated Basis of

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<PAGE> 27
such property at any point in time shall equal its Adjusted Carrying
Value for purposes of making the allocations required under Section
4.2.

(ii) Any item of loss or deduction which is determined by
reference to the adjusted tax basis of any such property shall be
allocated entirely to BEC.

(d) Items of deduction, loss and credit not specifically provided
for above, including depreciation, cost recovery and amortization deductions,
shall be allocated to the Partners in the same manner as the costs of the
Partnership that resulted in such items of deduction, loss and credit were
allocated pursuant to Section 4.1; provided, however that for the fiscal year
in which Threshold Value is achieved, and for all subsequent fiscal years,
depreciation, cost recovery and amortization deductions attributable to costs
allocated under Section 4.1(a) shall be allocated in the same manner as if such
costs had been allocated under Section 4.1(b); and provided further that for
the fiscal year in which the Partnership shall be dissolved, if Threshold Value
has not yet been achieved, all Partnership deductions and losses shall be
allocated among the Partners, to the extent permitted by law, as follows:

(i) first, as shall be required to cause as soon as possible
the Capital Accounts of BEC and Carter and the excess of the Capital
Accounts of General Atlantic and GAP L.P. over their respective Net
Capital Contributions to be in proportion to their respective Post
Threshold Ratios;

(ii) then, to the Partner's in proportion to their Post
Threshold Ratios until the Capital Accounts of General Atlantic and
GAP L.P. equal their respective Net Capital Contributions;

(iii) then, to BEC and Carter in proportion to the positive
balances in their respective Capital Accounts until their respective
Capital Accounts equal zero;

(iv) then to General Atlantic and GAP L.P. in proportion to
their respective positive Capital Account balances until their
respective Capital Accounts equal zero; and

(v) then to the Partners in proportion to their respective
Post Threshold Ratios.

Items of income or gain not specifically provided for above shall be allocated
to the Partners in the same manner that revenues of the Partnership that
resulted in such items of income or gain were allocated pursuant to Section
4.2.

(e) All recapture of income tax deductions resulting from the sale
or other disposition of Partnership property shall be allocated among the
Partners in the ratio in

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which the deductions giving rise to such recapture were allocated, but each
Partner shall be allocated recapture only to the extent that such Partner is
allocated any gain from the sale or other disposition of such property. The
balance of such recapture, if any, shall be allocated to the Partners whose
share of gain exceeds their share of recapture ("excess gain") and such balance
shall be allocated among such Partners in the proportion which the excess gain
of such Partner bears to the excess gains of all Partners.

(f) Notwithstanding any of the foregoing provisions of this
Section 4.3 to the contrary, if for any fiscal year of the Partnership the
allocation of any loss or deduction (net of any income or gain) to any Partner
would cause or increase a negative balance in such Partner's Adjusted Capital
Account as of the end of such fiscal year (the "Deficit Partner"), only the
amount of such loss or deduction that reduces the balance to zero shall be
allocated to the Deficit Partner and the remaining loss or deduction shall be
allocated to the Partners whose Adjusted Capital Accounts have a positive
balance remaining at such time (the "Positive Partners") in proportion to such
positive balances. If, after taking into account the allocation in the first
sentence of this Section 4.3(f), the Adjusted Capital Account balance of any
Deficit Partner remains less than zero at the end of a fiscal year, a pro rata
portion of each item of Partnership income or gain (including Simulated Gain)
otherwise allocable to the Positive Partners for such fiscal year (or if there
is no such income or gain allocable to the Positive Partners for such fiscal
year, an amount of income or gain (including Simulated Gain) so allocable in
the succeeding fiscal year or years) shall be allocated to the Deficit Partner
in an amount necessary to cause its Adjusted Capital Account balance to equal
zero; provided that if there is more than one Deficit Partner, such income or
gain shall be allocated to all Deficit Partners in proportion to their negative
Adjusted Capital Accounts; and provided further that no allocation under this
sentence shall have the effect of causing any Positive Partner's Adjusted
Capital Account to be less than zero. If, after taking into account the
allocations required by the preceding provisions of this Section 4.3, any
Partner's share of a net decrease in Minimum Gain (determined in accordance
with Treasury Regulation Section 1.704-1T(b)(4)(iv)(e)) attributable to the
disposition of Partnership property subject to Partnership Nonrecourse
Liabilities exceeds the amount of income and gain (including Simulated Gain)
allocated to such Partner (the "Chargeback Partner") pursuant to the preceding
provisions of this Section 4.3, further items of such income and gain for such
year (and, if necessary, for subsequent years), which items equal in the
aggregate the amount of such excess, that otherwise would be allocated to those
Partners whose allocated share of the gain from the disposition of such
property exceeds their respective share of the such decrease in Minimum Gain
attributable to the disposition of such property shall be allocated instead to
the Chargeback Partner. The provisions of this Section 4.3(f) are intended to
constitute both a "qualified income offset" and a "minimum gain chargeback"
within the meaning of Treasury Regulation Sections 1.704-1(b)(2)(ii)(d) and
1.704-1T(b)(4)(iv)(e).

Section 4.4. Distributions. All cash funds of the Partnership shall be
retained in the business of the Partnership and shall be distributed to the
Partners only at such time as the

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Management Committee shall approve; provided, however, that distributions shall
be made to each Partner in an amount equal to such Partner's Tax Amount, (as
herein defined), such distributions to be made not later than five days prior
to the due date of the applicable tax required to be paid by such Partner. A
Partner's "Tax Amount" for any taxable year shall be determined by the
following formula:

X = [(A + [B(1-A)])(C-D)] - E

Where X = The Tax Amount for such year;
A = the highest marginal federal income tax rate in
effect for such year (the "Federal Tax Rate");
B = the highest marginal Texas income tax rate (including
the franchise tax rate applicable to income) in
effect for such year;
C = such Partner's allocable share of the aggregate
taxable income or gain (including amounts realized in
excess of the adjusted tax basis in Depletable
Property sold by the Partnership) of the Partnership
for the current and all prior taxable years;
D = such Partner's allocable share of the aggregate
deductions and losses (including amounts realized
which are less than the adjusted tax basis of
Depletable Property sold by the Partnership)
recognized by the Partnership during the current and
all prior taxable years; and
E = the aggregate Tax Amounts distributed to such Partner
in all prior taxable years.

For purposes of this calculation, A and B shall both be the rates applicable to
corporations or individuals, whichever results in the larger combined amount.

The Tax Amount for each Partner shall be determined annually (and revised
periodically, as necessary) by the Partnership's independent accounting firm
and reported to the Management Committee. Distributions in excess of the Tax
Amounts, if approved by the Management Committee, shall be made in the
following percentages and amounts:

(a) If the distribution is made prior to the attainment
of Threshold Value:

(i) an amount shall first be distributed to General
Atlantic and GAP L.P. equal to their respective Net Capital
Contributions as computed immediately prior to such
distributions, and

(ii) the remaining amount to be distributed shall be
allocated among the Partners in proportion to their respective
Distribution Amounts. A Partner's "Distribution Amount" on the
date of any distribution shall be determined by the following
formula:

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<PAGE> 30
Y = (F + G)(H) - I

Where Y = such Partner's Distribution Amount;
F = the amount to be distributed by the Partnership to
all Partners pursuant to this clause (ii) or
paragraph (b) below, whichever is applicable;
G = the sum of the Aggregate Tax Amounts of all Partners;
H = such Partner's Post Threshold Ratio; and
I = such Partner's Aggregate Tax Amount;

all as of the date of the distribution.

(b) If the distribution is made after the attainment of
Threshold Value, all distributions shall be allocated to the Partners
in proportion to their respective Distribution Amounts.

Notwithstanding the foregoing, however, (i) any liquidating
distributions shall be made in accordance with Section 11.2, and (ii) no
distribution shall be made to any Partner if such distribution would cause the
Adjusted Capital Account balance of such Partner to be less than zero.

ARTICLE V

Partnership Property

Section 5.1. Lease Acquisitions.

(a) BEC shall contribute and assign to the Partnership pursuant to
Section 3.1(a) the assets constituting the Business. The interest in each oil
and/or gas property contributed to the Partnership by BEC shall cover all
depths and horizons owned by BEC in and under the Lease for such property.

(b) With respect to those assets that BEC cannot transfer to the
Partnership on the Effective Date due to the failure or inability of BEC to
obtain the consents of third parties necessary to effect such transfer (such
assets are identified on Exhibit H hereto and are referred to herein as the
"Unassigned Assets"), BEC shall use its best efforts to obtain such consents or
otherwise take such action as shall be required to effect the transfer of the
Unassigned Assets to the Partnership as soon as possible after the Effective
Date. If BEC determines, after consulting with the GAP Representatives, that
any Unassigned Asset cannot be transferred to the Partnership because of the
failure or refusal of any third party to consent to such transfer, then BEC
shall hold such Unassigned Asset in trust for the benefit of the Partnership,
make such Unassigned Asset available for use by the Partnership

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<PAGE> 31
and otherwise insure that all economic and, to the extent possible, legal
incidents of ownership of such Unassigned Asset inure to the benefit of the
Partnership. The costs and expenses associated with managing, operating and
maintaining any Unassigned Asset not so transferred to the Partnership shall be
deemed a Partnership expense and shall be paid directly by the Partnership upon
presentation to it by BEC of evidence substantiating such costs and expenses,
or shall be paid directly by BEC which, upon presentation to the Partnership of
evidence substantiating such costs and expenses, shall be reimbursed by the
Partnership.

(c) Subject to Section 6.2, during the term of this Agreement, the
Chief Executive Officer and the Managing General Partner (if requested by the
Chief Executive Officer) may cause the Partnership to acquire additional Leases
that it deems suitable for acquisition by the Partnership for exploration or
development purposes to the extent funds of the Partnership are available
therefor.

Section 5.2. Title to Partnership Property. All property owned by the
Partnership, whether real or personal, tangible or intangible, shall be deemed
to be owned by the Partnership as an entity, and no Partner, individually,
shall have any ownership of such property. The Partnership shall hold all of
its assets in the name of the Partnership. The Chief Executive Officer shall
promptly take all such action as it shall deem necessary or appropriate, or as
may be required by law, to perfect and preserve the ownership interest of the
Partnership in all Leases.

Section 5.3. Lease Sales.

(a) Subject to the provisions of Section 6.2(c), the Chief
Executive Officer and the Managing General Partner (if requested by the Chief
Executive Officer) may sell, farmout, abandon or otherwise dispose of any Lease
of the Partnership, on such terms as the Chief Executive Officer and/or the
Managing General Partner, as applicable, deems reasonable and in the best
interests of the Partnership and the Partners.

(b) Except as expressly permitted in Section 11.2, neither a
General Partner nor any of its Affiliates shall acquire, directly or
indirectly, any Partnership Lease (or any interest therein) from the
Partnership unless the Management Committee has previously approved in writing
such acquisition by the affirmative vote of a majority of the Representatives
including at least one Representative of the non-interested Partner in such
acquisition.

Section 5.4. Insurance. The Partnership shall obtain for the benefit
of the Partnership, insurance coverage as is customary for the types of
business to be conducted by the Partnership in such amounts and for such
coverage as the General Partners shall mutually agree upon, which shall include
general liability umbrella coverage in an amount not less than $20,000,000. In
the event the General Partners fail to agree on the dollar limits of such
coverage, the higher amount of coverage, as reasonably requested, shall be

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obtained by the Partnership. To the extent practicable, the Partners will be
included as additional insureds on such insurance policies.

ARTICLE VI

Management

Section 6.1. Management Committee.

(a) The General Partners shall participate in the management and
conduct of the business of the Partnership through a management committee
(herein called the "Management Committee") initially comprised of five members
(which members as from time to time serving on the Management Committee are
herein collectively called "Representatives" and individually called a
"Representative"), of whom three shall be appointed by BEC (herein called the
"Brigham Representatives") and two of whom shall be appointed by General
Atlantic (herein called the "GAP Representatives"). The Management Committee
shall have full power and authority to formulate and set policy and strategies
for the Partnership and shall have formal authority for the administrative
functions of the Partnership with such policies, strategies and administrative
functions to be executed and performed by the Chief Executive Officer. The
Management Committee shall also be available to advise the Chief Executive
Officer with respect to operations of the Partnership and to give its consent
with respect to Major Decisions (as hereinafter defined). Except as
specifically provided herein, all actions taken and all determinations and
judgments made by the Management Committee, or by the officers or other agents
of the Partnership pursuant to the direction of the Management Committee, in
all cases in accordance with the terms of this Agreement, shall be conclusive
and binding on the Partnership and the Partners. Except as set forth in the
succeeding provisions of this Section 6.1, the Management Committee shall
conduct its proceedings in accordance with such rules as it may from time to
time establish. The Management Committee shall keep minutes of its meetings and
of the actions taken by it.

(b) The initial Management Committee shall be composed of the
following five Representatives, who shall be considered to be appointed by BEC
or General Atlantic as indicated below:

<TABLE>
<CAPTION>
Brigham Representatives GAP Representatives
----------------------- -------------------
<S> <C>
Ben M. Brigham Alexis M. Cranberg

Anne L. Brigham William E. Ford

Harold D. Carter
</TABLE>

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<PAGE> 33
(c) Each Representative shall serve at the pleasure of the Partner
that appointed him and may be removed, with or without cause, by the appointing
Partner upon written notice thereof given by the appointing Partners to the
other General Partner and to the other Representative(s); provided, however,
that for such period of time as he shall be employed by the Partnership, Ben M.
Brigham shall serve as a Brigham Representative. If a Representative should
die, resign, or be removed, the General Partner that appointed him shall have
the right to designate his successor by notice to the other Partners. In the
event that Carter shall be removed as a Brigham Representative during the term
of his consulting agreement with the Partnership, at the request of General
Atlantic, Carter shall become an additional Representative and the Management
Committee size shall automatically be increased to add a position for Carter.

(d) In the event of transfers of Partnership interests by the
Partners the following provisions shall apply:

(i) If GA Partners shall transfer in one or more
transactions, an aggregate of 15% or greater of their Post Threshold
Ratio interest to a transferee or transferees (other than to a GA
Permitted Transferee) such that, as a result of such transfer or
transfers, GA Partners' Post Threshold Ratio interest is equal to or
less than 25% (but more than 20%), then the GA Partners shall be
entitled to have only one Representative, whose affirmative vote shall
be required with respect to all Major Decisions, and any such
transferee which holds at least a 15% Post Threshold Ratio interest
shall at the election of General Atlantic be entitled to have only one
Representative, whose affirmative vote shall not be required with
respect to any Major Decisions.

(ii) If GA Partners shall transfer in one or more
transactions an aggregate of 20% of their Post Threshold Ratio
interest to a transferee or transferees (other than to a GA Permitted
Transferee) such that, as a result of such transfer or transfers, GA
Partners' Post Threshold Ratio interest is equal to or less than 20%
(but more than 15%), the GA Partners shall be entitled to have only
one Representative, whose affirmative vote shall be required only with
respect to the Major Decisions listed in Section 6.2(a) (but only with
respect to long-term debt in excess of the greater of $10,000,00 or
40% of the then fair market value of the Partnership's assets),
Section 6.2(c) (but only with respect to the sale, lease or other
disposition of all or substantially all of the Partnership's assets),
Section 6.2(i) and Section 6.2(k) (but only with respect to the
foregoing Major Decisions) (the foregoing Major Decisions, as so
modified, being referred to as the "Modified Major Decisions"), and
any such transferee which holds at least a 15% Post Threshold Ratio
interest shall be entitled to have only one Representative, whose
affirmative vote shall not be required with respect to any Major
Decisions or Modified Major Decisions.

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<PAGE> 34
(iii) If GA Partners shall transfer in one or more
transactions an aggregate of 25% or greater of their Post Threshold
Ratio interest to a transferee or transferees (other than to a GA
Permitted Transferee) such that, as a result of such transfer or
transfers, the GA Partners' Post Threshold interest is equal to or
less than 15%, then GA Partners shall not be entitled to have any
Representative, and any such transferee which holds at least a 15%
Post Threshold Ratio interest shall be entitled to have only one
Representative, whose affirmative vote shall not be required with
respect to any Major Decisions or Modified Major Decisions, provided,
that any such transferee which holds at least a 30% Post Threshold
Ratio interest shall be entitled to have two Representatives, at least
one of whose affirmative vote shall be required with respect to all
Modified Major Decisions.

(iv) If BEC and Carter (collectively, the "Management
Partners") shall transfer in one or more transactions an aggregate of
30% or greater of their Post Threshold Ratio interest to a transferee
or transferees (other than to their respective Permitted Transferees)
such that, as a result of such transfer or transfers, the Management
Partners' Post Threshold Ratio interest is equal to or less than 30%
(but more than 20%), then BEC shall be entitled to have only two
Representatives, one of whose affirmative vote shall be required with
respect to all Major Decisions, and any such transferee which holds at
least a 20% Post Threshold Ratio interest shall be entitled to one
Representative, whose affirmative vote shall not be required with
respect to any Major Decisions or Modified Major Decisions.

(v) If the Management Partners shall transfer in one or
more transactions an aggregate of 40% or greater of their Post
Threshold Ratio interest to a transferee or transferees (other than to
their respective Permitted Transferees) such that, as a result of such
transfer or transfers, the Management Partners' Post Threshold
interest is equal to or less than 20% (but more than 15%), then BEC
shall be entitled to only one Representative, whose affirmative vote
shall not be required with respect to any Major Decisions or Modified
Major Decisions, and any such transferee which holds at least a 20%
Post Threshold Ratio interest shall be entitled to one Representative,
whose affirmative vote shall not be required with respect to any Major
Decisions or Modified Major Decisions, provided, that any such
transferee which holds a 40% Post Threshold Ratio interest shall be
entitled to two Representatives, at least one of whose affirmative
vote shall be required with respect to all Modified Major Decisions.

(vi) If the Management Partners shall transfer in one or
more transactions an aggregate of 45% or greater of their Post
Threshold interest to a transferee or transferees (other than their
respective Permitted Transferees) such that, as a result of such
transfer or transfers the Management Partners' Post Threshold interest
is equal to or less than 15%, then BEC shall not be entitled to any
Representatives, and any such transferee which holds at least a 20%
Post Threshold Ratio interest shall be entitled to one Representative,
whose affirmative vote shall not be required with

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<PAGE> 35
respect to any Major Decisions or Modified Major Decisions, provided,
that any such transferee which holds a 40% Post Threshold Ratio
interest shall be entitled to two Representatives, at least one of
whose affirmative vote shall be required with respect to all Modified
Major Decisions.

(vii) Notwithstanding the foregoing clauses (i) through
(vi), any assignment or other transfer of the GA Partners' or
Management Partners' Post Threshold Ratio interest shall be subject to
the limitations in Article IX. Notwithstanding the foregoing clauses
(iv) through (vi), any permitted mortgagee, pledgee or other holder of
a secured interest in BEC's or the GA Partners' Post Threshold Ratio
interest in accordance with Section 9.2 shall not be entitled to
appoint any Representatives in the event such mortgagee, pledgee or
other secured party shall foreclose on or otherwise succeed to BEC's
or the GA Partners' Post Threshold Ratio interest under the terms of
any such mortgage, pledge or other security arrangement.

(e) The number of Representatives on the Management Committee may
be increased by the unanimous vote of the Management Committee and the
person(s) elected to fill any newly created position(s) on the Management
Committee shall be elected by a majority vote of the Management Committee,
including the affirmative vote of at least one Brigham Representative and at
least one GAP Representative.

(f) General Atlantic shall also have the right to designate one of
its partners or senior officers, or a partner of General Atlantic Partners as
of the Effective Date, as an observer at Management Committee meetings, which
observer shall have no voting rights or other rights to act as a
Representative.

(g) The Management Committee will hold regular quarterly meetings
and such additional regular meetings as may be determined by the Management
Committee. Special meetings of the Management Committee may be called by Ben M.
Brigham, as a Brigham Representative, upon five (5) calendar days prior notice.
Notice of each meeting shall state the date, time and place where such meeting
is to be held and the purposes for which it is called. Notice may be waived by
the other Representative(s) by attendance at such meeting or in writing.

(h) The presence at a meeting, either in person or by proxy, of a
majority of the Representatives shall constitute a quorum for the transaction
of business.

(i) Except as provided in Section 6.2 below, all decisions of the
Management Committee shall be made by the concurring vote, either in person or
by proxy, of a majority of the Representatives.

(j) Meetings of the Management Committee may be in person or by
telephonic communication in such manner as to permit all members to hear each
other at the same

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<PAGE> 36
time. Regular and special meetings in person shall be held at the principal
office of the Partnership, or at such other place as may be determined by the
Management Committee.

(k) Any action required or permitted to be taken at any meeting
may be taken (i) by unanimous written consent of the requisite number and type
of Representatives, or (ii) by means of a conference telephone or similar
communications equipment by means of which all Representatives participating in
the meeting can hear and speak to each other.

Section 6.2. Major Decisions Requiring Management Committee Approval.
All Major Decisions (as hereinafter defined) with respect to the Partnership
business shall require the approval of a majority vote of the members of the
Management Committee, which majority shall include at least one General
Atlantic Representative. Accordingly, notwithstanding anything in this
Agreement to the contrary, neither General Partner nor the Chief Executive
Officer shall have the right or the power to make any commitment or engage in
any undertaking on behalf of the Partnership in respect of a Major Decision
unless and until the Management Committee has authorized the same. The term
"Major Decision" as used in this Agreement means any decision with respect to
the following matters:

(a) The issuance of any form of long-term debt in excess of
$1,000,000, as such amount may be adjusted on an annual basis by the Management
Committee (including at least one GAP Representative voting in favor of such
adjustment) to reflect changes in the Partnership's financial position;

(b) Decisions with respect to the hiring, retention, termination
and compensation (including cash, equity, benefits and other compensation
features) of key functional personnel at the vice presidential (or equivalent)
level or above and the implementation of any employee benefit plan in which
such key functional personnel are eligible to participate;

(d) The issuance of any additional Partnership interests or any
other form of Equity Securities in the Partnership; provided, however, that the
issuance of equity interests or options therefor to management personnel under
any established option plan of the Partnership (which plan was approved as a
Major Decision) in an amount not exceeding 10% of the Partnership's total
outstanding equity shall not be deemed to be a Major Decision requiring
Management Committee approval;

(e) Approval of annual operating and capital budgets;

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(f) The expenditure or commitment of Partnership funds in excess
of $500,000 with respect to amounts not previously included in an annual
operating or capital budget, which threshold amount (originally $500,000) shall
be increased annually by the Management Committee to reflect changes in the
Partnership's financial position;

(g) The declaration of any cash or asset distributions pursuant to
Section 4.4, other than tax distributions provided for in Section 4.4;

(h) Any decision to convert the Partnership to corporate form;

(i) Any decision to merge or consolidate the Partnership's
business or to acquire all or substantially all of the assets of another
company;

(j) Any decision of the Partnership to file a voluntary petition
seeking liquidation, reorganization, arrangement or readjustment, in any form,
of the Partnership's debts under Title 11 of the United States Code (or
corresponding provisions of future laws) or any other federal or state
insolvency law, or to file an answer consenting to or acquiescing in any such
petition, or the making by the Partnership of any general assignment for the
benefit of its creditors or the admission in writing of its inability to pay
its debts as they mature; and

(k) All material amendments to this Agreement, including without
limitation the items that constitute Major Decisions as provided herein.

After the expiration of seven years, commencing with the Effective Date, if the
Threshold Value has been achieved and BEC shall own at least 50% of its
original Post Threshold Ratio interest in the Partnership, the actions set
forth in subsection (c) (but only with respect to the sale of all or
substantially all of the assets of the Partnership for cash and/or equity
securities of a company with a market value in excess of one hundred million
dollars listed on a national securities exchange) and subsections (d) and (i)
with respect to any public offering of equity securities, shall no longer be
deemed to be Major Decisions for purposes of the approval process set forth in
this Section 6.2 and are actions that may be taken by BEC without the consent
of any other Partners or the Management Committee. If at any time BEC should
decide to sell all or substantially all of the assets of the Partnership for
cash and/or equity securities, BEC shall give GA Partners sixty (60) days
written notice of its intent to so act. Within such sixty (60) day period GA
Partners shall have the right to make a written offer to the Partnership to
acquire such assets of the Partnership or all of the Partners' interests in the
Partnership. BEC shall have the right for a period of six (6) months after
receipt of such offer to accept said offer or to consummate a sale of such
assets for a price not less than the price offered by GA Partners. Should the
GA Partners' offer not be deemed acceptable to BEC, BEC shall have no
obligation to sell.

Section 6.3. Officers and Agents. Except as otherwise provided herein,
the Management Committee shall elect or appoint agents of the Partnership to
perform such

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duties in the management of the Partnership as may be provided herein or
authorized by the Management Committee. The Management Committee may use
descriptive words or phrases to designate the standing, seniority or area of
special competence of the agents elected or appointed by it.

Section 6.4. Power and Authority of the Chief Executive Officer and
Managing General Partner.

(a) Ben M. Brigham shall act as Chief Executive Officer of the
Partnership pursuant to the Employment Agreement and shall have the power and
authority to conduct the day to day business and operations of the Partnership.
The Chief Executive Officer will report to the Management Committee. Upon the
request of the Chief Executive Officer, BEC, which shall be designated as the
Managing General Partner, shall be authorized to execute documents, instruments
and other agreements on behalf of the Partnership and to ratify and confirm all
actions of the Chief Executive Officer. If at any time Ben M. Brigham shall
cease to be employed by the Partnership as Chief Executive Officer or in a
similar capacity or if Ben M. Brigham and his Permitted Transferees should
cease to own and control 100% of the capital stock of BEC and all securities
convertible into and exchangeable therefor, BEC shall at such time cease to be
Managing General Partner. In such event, the Management Committee may elect a
new Managing General Partner or elect not to have a Managing General Partner
and all functions of the Managing General Partner shall be performed in the
manner provided at the direction of the Management Committee.

(b) The Chief Executive Officer shall, except as provided in
Sections 6.1(a) and 6.2 and elsewhere in this Agreement and except as otherwise
provided by applicable law, have full power and authority on behalf of the
Partnership to manage, control, administer and operate the properties, business
and affairs of the Partnership in accordance with this Agreement as is
necessary or desirable to conduct the day to day operations of the Partnership,
to carry out and bind the Partnership with respect to decisions of the
Management Committee in the manner provided herein and to do or cause to be
done any and all acts deemed by the Chief Executive Officer to be necessary or
appropriate thereto, and (except as aforesaid) the scope of such power and
authority shall encompass all matters in any way connected with such business
or incident thereto, including without limitation (except as aforesaid) the
power and authority:

(i) To acquire the Business and execute and cause the
Partnership to perform its obligations under the Conveyances;

(ii) To purchase or otherwise acquire Leases as provided
herein;

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(iii) To purchase or otherwise acquire other real or
personal property of every nature considered necessary or appropriate
to carry on and conduct the business of the Partnership;

(iv) To borrow monies for the purchase, development and
maintenance of Partnership assets and other aspects of the
Partnership's business and from time to time to draw, make, execute
and issue promissory notes and other negotiable or non-negotiable
instruments and evidences of indebtedness; to secure the payment of
the sums so borrowed and to mortgage, pledge or assign in trust all or
any part of the property of the Partnership, and to assign any monies
owing or to be owing to the Partnership;

(v) To enter into any agreements of joint venture or
partnership or for sharing of risks, expenses or profits, with any
person, firm, Partnership, government or agency thereof engaged in any
business or transaction in which the Partnership is authorized to
engage;

(vi) To prospect by geological, geophysical or other
methods for the location of anomalies or other indications favorable
to the accumulation of oil and gas, including specifically the power
to contract with third parties for such purposes;

(vii) To maintain, develop, operate, manage and defend
Partnership property; to drill, test, plug and abandon or complete and
equip, rework and recomplete any number of Partnership wells on
Partnership Leases for the production of oil and gas located
thereunder; to contract with third parties for such purposes; to carry
out a program or programs of enhanced recovery operations on the
Leases of the Partnership; and to do any and all other things
necessary or appropriate to carry out the terms and provisions of this
Agreement which would or might be done by a normal and prudent
operator in the development, operation and management of its own
property;

(viii) To enter into and execute operating agreements,
drilling contracts, farmouts, dry and bottom hole and acreage
contribution letters, participation agreements, gas processing
agreements and any other agreements customarily employed in the oil
and gas industry in connection with the acquisition, sale, development
or operation of oil and gas properties, agreements as to rights-of-way
and any and all other instruments or documents considered by the Chief
Executive Officer to be necessary or appropriate to carry on and
conduct the business of the Partnership, for such consideration and on
such terms as the Chief Executive Officer may determine to be in the
best interests of the Partnership;

(ix) To sell the production accruing to Partnership Leases
to such purchaser and on such terms and conditions as the Chief
Executive Officer shall determine to

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be in the best interest of the Partnership and to execute gas sales
contracts, casinghead gas contracts, transfer orders, division orders
or any other instruments in connection with the sale of production
from the Partnership's interest in such Leases;

(x) To farmout, sell, assign, convey or otherwise dispose
of, for such consideration and upon such terms and conditions as the
Chief Executive Officer may determine to be in the best interests of
the Partnership, all or any part of the Partnership property, any
interest therein, or any interest payable therefrom, and in connection
therewith to execute and deliver such deeds, assignments and
conveyances containing such warranties as the Chief Executive Officer
may determine to be appropriate;

(xi) To purchase, lease, rent or otherwise acquire or
obtain the use of facilities, machinery, equipment, tools, materials
and all other kinds and types of real or personal property that may in
any way be deemed necessary, convenient or advisable in connection
with carrying on the business of the Partnership;

(xii) To pay delay rentals, bonus payments, shut-in gas
royalty payments, property taxes and any other amounts necessary or
appropriate to the maintenance or operation of any Partnership
property;

(xiii) To make and to enter into such agreements and
contracts with such parties and to give such receipts, releases and
discharges with respect to any and all of the foregoing and any
matters incident thereto as the General Partner may deem advisable or
appropriate;

(xiv) To procure and maintain in force such insurance as
the Chief Executive Officer shall deem prudent to serve as protection
against liability for loss and damage which may be occasioned by the
activities to be engaged in by the Partnership or the Chief Executive
Officer on behalf of the Partnership;

(xv) To sue and be sued, complain and defend in the name
of and on behalf of the Partnership;

(xvi) To quitclaim, surrender, release or abandon any
Partnership property, with or without consideration therefor;

(xvii) To execute and deliver all checks, drafts, endorsements
and other orders for the payment of Partnership funds;

(xviii) To appear and to represent the Partnership before any
governmental authority or regulatory agency and to make all necessary
or appropriate filings before such authority or agency;

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(xix) To elect to go "non-consent" under any operating
agreement applicable to any Partnership Lease or well and to elect to
pay the costs and expenses of any non-consenting party under any such
operating agreement; and

(xx) To take such other action, execute and deliver such
other documents and perform such other acts as may be deemed by the
Chief Executive Officer to be appropriate to carry out the business
and affairs of the Partnership in accordance with this Agreement.

(c) Subject to Sections 6.1(a) and 6.2, General Atlantic hereby
agrees that each of the Chief Executive Officer and the Managing General
Partner (if acting at the request of the Chief Executive Officer) is authorized
to execute, deliver and perform the agreements, acts, transactions and matters
as described in this Agreement on behalf of the Partnership without any further
act, approval or vote of the Partners or the Partnership, notwithstanding any
other provision of this Agreement, the Act or any applicable law, rule or
regulation. The participation by the Managing General Partner in any agreement
or action authorized or permitted under this Agreement shall not constitute a
breach by the Managing General Partner of any duty that the Managing General
Partner may owe the Partnership or the other Partners under this Agreement or
under applicable law.

Section 6.5. Standard of Care of Chief Executive Officer and Managing
General Partner. In the conduct of the business and operations of the
Partnership, the Chief Executive Officer and the Managing General Partner shall
use their best efforts to cause the Partnership (a) to comply with the terms
and provisions of all agreements to which the Partnership is a party or to
which its properties are subject, (b) to comply in all material respects with
all applicable laws, ordinances or governmental rules and regulations to which
the Partnership is subject and (c) to obtain and maintain all licenses,
permits, franchises and other governmental authorizations necessary with
respect to the ownership of Partnership properties and the conduct of
Partnership business and operations. With respect to the maintenance,
development and operation of Leases, the Chief Executive Officer and the
Managing General Partner shall have the standard of care of a prudent and
diligent operator. Nothing in this Agreement shall preclude the employment or
use of any agent, third party, or Affiliate to assist in the management or
provide other services with respect to the Partnership's assets or business as
the Chief Executive Officer shall determine. Under no circumstances shall the
Chief Executive Officer or any other officer of the Partnership have any duties
of care or liability to the Partnership, the Partners or third parties in
excess of any duties of care or liability that such officer would have as
officers of a corporation.

Section 6.6. Employees. Subject to Section 6.2, the Partnership may,
at the discretion of the Chief Executive Officer, hire such employees from time
to time as the Chief Executive Officer may deem to be necessary or desirable in
his sole discretion for such purposes and compensation as the Chief Executive
Officer shall determine. The Partnership shall also enter into an employment
agreement with Ben M. Brigham substantially in the

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form attached hereto as Exhibit F and a consulting agreement with Harold D.
Carter substantially in the form attached hereto as Exhibit G, both on the
Effective Date. All persons employed by BEC immediately prior to the Effective
Date shall become employees of the Partnership on the Effective Date.

Section 6.7. Liability of General Partners and Others. The General
Partners, the Representatives, the Chief Executive Officer and any other
officers of the Partnership shall not be liable, responsible or accountable in
damages or otherwise to the Partnership or the other Partners for, and (subject
to Section 6.8) the Partnership shall indemnify and save harmless each General
Partner, Representative, Chief Executive Officer and other officers from, any
costs, expenses, losses or damages (including attorneys' fees and expenses,
court costs, judgments and amounts paid in settlement) incurred by reason of it
being a General Partner, a Representative, Chief Executive Officer or an
officer, provided it has acted in good faith on behalf of the Partnership and
in a manner reasonably believed by it to be within the scope of the authority
granted to it by this Agreement and in the best interests of the Partnership,
and provided further that (i) such General Partner, Representative, Chief
Executive Officer or officer was not guilty of gross negligence or willful
misconduct with respect to such acts or omissions and (ii) the satisfaction of
any indemnification and any saving harmless shall be from and limited to
Partnership assets and not from any Capital Contributions to be made. The Chief
Executive Officer shall use its best efforts to pay or cause to be paid in a
proper and timely manner any delay rentals, bonus payments and shut-in gas
payments and other similar payments which may be necessary to maintain in force
and effect any Partnership Lease; provided, however, that in the absence of bad
faith or gross negligence, the Chief Executive Officer shall not be liable to
the Partnership or the Partners for any failure or neglect to pay properly and
timely any such rentals or payments.

Section 6.8. Indemnification of Chief Executive Officer, General
Partners and Others. To the fullest extent permitted by law, the Partnership
shall indemnify and hold harmless the Chief Executive Officer, the General
Partners, and any officer, director or shareholder or partner of a Partner, any
employees and agents of the Partnership, and any person who is or was serving
at the request of the Partnership as a Representative, consultant, director,
officer, partner, trustee, employee or agent of another corporation,
partnership, joint venture, trust or other entity (individually, an
"Indemnitee"), as follows:

(a) In any proceeding to which an Indemnitee was or is a party or
is threatened to be made a party because such Indemnitee is or was the Chief
Executive Officer, a General Partner, an officer, director, shareholder or
partner thereof, an employee or agent, a Representative, a consultant, or a
person serving at the request of the Partnership in a similar capacity, the
Partnership shall indemnify and hold harmless such Indemnitee against
judgments, penalties (including excise and similar taxes), liabilities, losses,
fines, amounts paid in settlement and reasonable expenses actually incurred by
such Indemnitee in connection with the proceeding, if (i) such Indemnitee was
successful in whole or in part, on the merits or otherwise, in the defense of
such proceeding or (ii) such Indemnitee acted in

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good faith and reasonably believed that such conduct was in the Partnership's
best interests or was at least not opposed to the Partnership's best interests,
and in the case of a criminal proceeding, such Indemnitee had no reasonable
cause to believe that its conduct was unlawful. The Partnership shall also
provide such indemnification in any action, suit or proceeding by or in the
right of the Partnership to procure a judgment in its favor, provided that if
in such action, suit or proceeding the Indemnitee shall have been adjudged to
be liable under the terms hereof, such indemnification shall be provided only
if, and only to the extent that, the court in which such action, suit or
proceeding was brought shall determine upon application that, despite the
adjudication of liability but in view of all circumstances of the case, the
Indemnitee is fairly and reasonably entitled to indemnification for such
expenses which such court shall deem proper. Any indemnification pursuant to
this Section 6.8 shall be made only out of Partnership assets, and no Partner
shall have any personal liability therefor.

(b) The termination of a proceeding by judgment, order,
settlement, conviction, or on a plea of nolo contendere or its equivalent shall
not alone determine that the Indemnitee did not meet the requirements provided
by subsection (a) above.

(c) A determination that indemnification is permissible under
subsection (a) above shall be made (unless otherwise ordered by a court) in the
following manner: (i) by special independent legal counsel selected by a
majority vote of the Management Committee, not including the vote of any
interested Representatives; (ii) by a majority vote of the Management
Committee, not including the vote of any interested Representatives; or (iii)
by a majority in interest of the non-interested Partners. Upon such
determination, the indemnification of the Indemnitee as provided herein shall
be deemed authorized and approved.

(d) Expenses (including legal fees and expenses) incurred in
defending any proceeding subject to subsection (a) of this Section 6.8 shall be
paid by the Partnership in advance of the final disposition of such proceeding
upon receipt of an undertaking (which need not be secured) by or on behalf of
the Indemnitee to repay such amount if it shall ultimately be determined, by a
court of competent jurisdiction or otherwise, that the Indemnitee is not
entitled to be indemnified by the Partnership as authorized hereunder.

(e) Notwithstanding any other provision of this Section 6.8, the
Partnership may pay or reimburse expenses incurred by an Indemnitee in
connection with such Indemnitee's appearance as a witness or other
participation in a proceeding involving or affecting the Partnership at a time
when such Indemnitee is not a named defendant or respondent in the proceeding.

(f) The Partnership may purchase and maintain insurance or
establish and maintain another arrangement on behalf of any one or more
Indemnities or such other persons as the Chief Executive Officer may determine
against any liability asserted against

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the person and incurred by the person in that capacity or arising out of the
person's status in that capacity, regardless of whether the Partnership would
have the power to indemnify the person against that liability under this
Section 6.8. Without limiting the power of the Partnership to procure or
maintain any kind of insurance or other arrangement, the Partnership may, for
the benefit of persons indemnified by the Partnership, (i) create a trust fund,
(ii) establish any form of self-insurance, (iii) secure its indemnity
obligation by grant of a security interest or other lien on the assets of the
Partnership, or (iv) establish a letter of credit, guaranty, or surety
arrangement. The insurance or other arrangement may be procured, maintained, or
established within the Partnership or with an insurer or other person
considered appropriate by the Chief Executive Officer. In the absence of actual
fraud, the judgment of the Chief Executive Officer as to the terms and
conditions of the insurance or other arrangement and the indemnity of the
insurer or other person participating in an arrangement shall be conclusive,
and the insurance or other arrangement shall not be voidable and shall not
subject the Chief Executive Officer approving the insurance or other
arrangement to liability, on any ground, regardless of whether the Chief
Executive Officer participating in approving the insurance or other arrangement
will be a beneficiary.

(g) The indemnification provided by this Section 6.8 shall be in
addition to any other rights to which each Indemnitee may be entitled under any
agreement or vote of the Partners, as a matter of law or otherwise, both as to
action in the Indemnitee's capacity as the Chief Executive Officer, a General
Partner, an officer, director, partner or shareholder of such Partner, an
employee, agent, Representative or consultant or as a person serving at the
request of the Partnership as set forth above and as to action in another
capacity, and shall continue as to an Indemnitee who has ceased to serve in
such capacity and shall inure to the benefit of the heirs, successors, assigns,
administrators and personal representatives of the Indemnitee.

(h) In no event may an Indemnitee subject the Limited Partners to
personal liability by reason of these indemnification provisions.

(i) An Indemnitee shall not be denied indemnification in whole or
in part under this Section 6.8 because the Indemnitee had an interest in the
transaction with respect to which the indemnification applies if the
transaction was otherwise permitted by the terms of this Agreement.

(j) The provisions of this Section 6.8 are intended to comply with
the Act. To the extent that any provision of this Section authorizes or
requires indemnification or the advancement of expenses contrary to such
statute, the Partnership's power to indemnify or advance expenses under this
Section 6.8 shall be limited to that permitted by such statute and any
limitation required by such statute shall not affect the validity of any other
provision of this Section 6.8.

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(k) For purposes of this Section 6.8;

(i) The term "expenses" includes court costs and
reasonable attorneys' fees, charges and disbursements.

(ii) the term "proceeding" means any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative, arbitrative or investigative, any appeal in such an
action, suit or proceeding, and any inquiry or investigation that
could lead to such an action, suit or proceeding.

Section 6.9. Costs, Expenses and Reimbursement.

(a) Subject to the other express provisions of this Agreement, all
costs and expenses reasonably incurred in the Partnership's business shall be
paid from Partnership funds, including without limitation costs of reports
under Section 8.2, costs of obtaining audits of the Partnership's books and
records, outside legal costs, outside accounting fees for tax returns, general
taxes and other direct costs and expenses of the Partnership. In conducting the
business and operations of the Partnership, the Managing General Partner may
use its or its Affiliates' own personnel, properties and equipment.

(b) All direct, third party out-of-pocket costs and expenses
incurred by the Chief Executive Officer, the Managing General Partner and their
Affiliates in managing and conducting the business and affairs of the
Partnership, including without limitation all reporting and other similar
services, travel, telephone and similar costs and expenses, expenses incurred
in providing or obtaining accounting, legal, engineering and other
professional, technical, administrative and other services and advice as the
Chief Executive Officer may deem necessary or desirable, shall be paid or
reimbursed by the Partnership as a Partnership expense. The Partnership shall
also reimburse the Managing General Partner for the costs of any assets held by
it in trust or otherwise for the benefit of the Partnership as provided in
Section 5.1(b). Such reimbursements shall be made periodically throughout the
term of the Partnership.

(c) The Partnership shall pay directly, or shall reimburse the
General Partners for any payment by them of the Organization Costs.

Section 6.10. Contracts With Affiliates. The Partnership may enter
into contracts and agreements with a General Partner and its Affiliates for the
rendering of services and the sale and lease of supplies and equipment,
provided that the amount of the compensation, price or rental that can be
charged to the Partnership therefor must be no less favorable to the
Partnership than those available from unrelated third parties in the area
engaged in the business of rendering comparable services or selling or leasing
comparable

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equipment and supplies which could reasonably be made available to the
Partnership; and provided further, that any such contract for services shall be
terminable by the Partnership without penalty upon 60 days' prior written
notice. All contracts entered into between the Partnership and a General
Partner or an Affiliate thereof shall be approved by the Management Committee
including the vote of at least one Representative of a non-interested General
Partner.

Section 6.11. Tax Elections. The Managing General Partner shall make
the following elections on behalf of the Partnership:

(a) To elect, in accordance with Section 263(c) of the Internal
Revenue Code and applicable regulations and comparable state law provisions, to
deduct as an expense all intangible drilling and development costs with respect
to productive and non-productive wells and the preparation of wells for the
production of oil or gas;

(b) To elect as the fiscal year of the Partnership such fiscal
year as is provided in Section 8.1(a);

(d) To elect, in accordance with Sections 195 and 709 of the
Internal Revenue Code and applicable regulations and comparable state law
provisions, to treat all organization costs of the Partnership as deferred
expenses amortizable over 60 months; and

(e) To elect with respect to such other federal, state and local
tax matters as the General Partners shall agree.

Section 6.12. Tax Returns. The Managing General Partner shall prepare
or cause to be prepared and timely file all federal, state and local income and
other tax returns and reports as may be required as a result of the business of
the Partnership. The Managing General Partner shall provide such information as
is reasonably necessary for the Partners to file their federal income tax
returns or any state income tax returns. The Managing General Partner shall be
designated the tax matters partner under Section 6231 of the Internal Revenue
Code and is authorized to take such actions and to execute and file all
statements and forms on behalf of the Partnership that are permitted or
required by applicable provisions of the Internal Revenue Code or Treasury
Regulations issued thereunder, and the Partners will take all other action that
may be necessary or appropriate to effect the designation of the Managing
General Partner as the tax matters partner. In the event of an audit of the
Partnership's income tax returns by the Internal Revenue Service, the Managing
General Partner may, at the expense of the Partnership, retain accountants and
other professionals to participate in the audit. All expenses incurred by the
Managing General Partner in its capacity as tax matters partner shall be
expenses of the

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Partnership and shall be paid or reimbursed to the Managing General Partner
from Partnership funds.

Section 6.13. Other Matters Concerning a General Partner.

(a) A General Partner, and its officers, directors, partners,
employees, Representatives, consultants and agents and any person acting at the
request of such General Partner (collectively, its "Agents") may rely and shall
be protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, or other paper or document reasonably believed by them
to be genuine and to have been signed or presented by the proper party or
parties.

(b) A General Partner and its Agents may consult with legal
counsel, accountants, appraisers, management consultants, investment bankers,
and other consultants and advisers selected by them and any opinion of any such
person as to matters which such General Partner or such Agents believe to be
within such person's professional or expert competence shall be full and
complete authorization and protection in respect of any action taken or
suffered or omitted by such General Partner or its Agents hereunder in good
faith and in accordance with such opinion.

(c) No person dealing with the Partnership shall be required to
inquire into the authority of the Chief Executive Officer or of the Managing
General Partner (if acting at the request of the Chief Executive Officer) to
take any action or make any decision hereunder.

Section 6.14. Confidentiality; Other Business of General Atlantic.
Each of the Partners will maintain the confidentiality of, and will not
disclose without the consent of the Management Committee, any and all
proprietary or confidential information of the Partnership, and each of the
General Partners will cause each of its Representatives on the Management
Committee not to disclose such proprietary and confidential information,
provided, however, the Partners may disclose such information to their
respective attorneys, accountants and other authorized agents, provided that
such persons agree to keep such information confidential. In addition, each
Partner shall hold in strict confidence all information it learns about the
other Partner's businesses and their partners and officers, and agrees not to,
without the prior written consent of the other Partner, disclose such
information to any person. For the purposes hereof, "proprietary or
confidential information" of the Partnership shall not include information that
is or becomes generally available to the public other than as a result of a
disclosure by a Partner in breach of this provision. Notwithstanding anything
in this Agreement to the contrary, but subject to the foregoing, General
Atlantic and its Affiliates and their respective partners, officers, directors
and stockholders shall not be prohibited from managing and participating in
their current business and investment interests in the oil and gas industry or
from investing in, managing and participating in additional business and
investment interests in the oil and gas industry.

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Neither the Partnership nor any other Partner shall have any rights in or to
such businesses and investments or the income or profits derived therefrom.

ARTICLE VII

Rights and Obligations of Limited Partners

Section 7.1. Rights of Limited Partners. In addition to the other
rights specifically set forth herein, the Limited Partners shall have the right
to: (a) at all reasonable times have access to Partnership records as provided
in Section 17.305 of the Act, (b) have on demand true and full information of
all things affecting the Partnership and a formal account of Partnership
affairs whenever circumstances render it just and reasonable, (c) have
dissolution and winding up by decree of court as provided for in the Act, and
(d) exercise all rights of a limited partner under the Act (except to the
extent otherwise specifically provided herein). Notwithstanding the foregoing,
a Limited Partner as a limited partner or in any other capacity, and the
partners, officers, directors, employees and stockholders of any Limited
Partner or general partner of any Limited Partner, shall be permitted to act as
officers or directors of the Partnership, consultants to the Partnership,
Representatives on the Management Committee and in similar capacities on behalf
of the Partnership.

Section 7.2. Limitations on Limited Partners. A Limited Partner as a
limited partner shall not if inconsistent with the Act: (a) be permitted to
take part in the business or control of the business or affairs of the
Partnership; (b) have any voice in the management or operation of any
Partnership property; or (c) have the authority or power in its capacity as a
Limited Partner to act as agent for or on behalf of the Partnership or any
other Partner, to do any act which would be binding on the Partnership or any
other Partner, or to incur any expenditures on behalf of or with respect to the
Partnership.

Section 7.3. Liability of Limited Partners. A Limited Partner shall
not be liable for the debts, liabilities, contracts or other obligations of the
Partnership except to the extent of any unpaid Capital Contributions agreed to
be made by it as set forth in Section 3.2, such Limited Partner's share of the
assets (including undistributed revenues) of the Partnership, and as provided
by the Act with respect to distributions made to a Limited Partner by the
Partnership; and in all events, a Limited Partner shall be liable and obligated
to make payments of its Capital Contributions only as and when such payments
are due in accordance with the terms of this Agreement, and a Limited Partner
shall not be required to make any loans to the Partnership. The Partnership
shall indemnify and hold harmless each Limited Partner in the event it (a)
becomes liable for any debt, liability, contract or other obligation of the
Partnership except to the extent expressly provided in the preceding sentence
or (b) is directly or indirectly required to make any payments with respect
thereto.

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Section 7.4. Withdrawal and Return of Capital Contribution. A Limited
Partner shall not be entitled to (a) withdraw from the Partnership except upon
the assignment by it of all of its interest in the Partnership and the
substitution of such Limited Partner's assignee as a Limited Partner of the
Partnership in accordance with Section 9.1, or (b) the return of its Capital
Contributions except to the extent, if any, that distributions made pursuant to
the express terms of this Agreement may be considered as such by law or by
unanimous agreement of the Partners, or upon dissolution and liquidation of the
Partnership, and then only to the extent expressly provided for in this
Agreement and as permitted by law.

Section 7.5. Power of Attorney. Each Limited Partner hereby makes,
constitutes and appoints each of the General Partners and any successor General
Partners of the Partnership and their authorized officers, employees and agents
its true and lawful agent and attorney-in-fact, with full power and authority
in its name, place and stead, to make, execute, sign, acknowledge, swear to,
record and file, on behalf of such Limited Partner or of the Partnership, such
documents, instruments, conveyances and certificates as may be necessary or
appropriate to carry out the provisions and purposes of this Agreement,
including, without limitation, (a) any Certificate of Limited Partnership of
the Partnership and all amendments thereto required or permitted by law or the
provisions of this Agreement, or modifications of any documents, instruments or
agreements deemed appropriate to reflect the admission or substitution of
additional partners to the Partnership in accordance with the provisions of
this Agreement; (b) the amendment or restatement of this Agreement in
accordance with the terms hereof; (c) all certificates and other instruments
deemed advisable to permit the Partnership to qualify to do business or to
protect the limited liability of the limited partners of the Partnership in any
jurisdiction; (d) all conveyances and other instruments (including Certificates
of Cancellation and Certificates of Withdrawal) deemed advisable to effect the
dissolution and termination of the Partnership in accordance with the terms of
this Agreement; (e) any offers to lease, Leases, assignments and requests for
approval of assignments, statements of citizenship, interest and holdings, and
any other instruments or communications now or hereafter required or permitted
to be filed on behalf of the Partnership or the several Partners of the
Partnership in their capacities as such under any law relating to the leasing
of government land (federal and state) for oil and gas exploration, development
and production; and (f) all other instruments and documents that may be
required or permitted by law to be filed on behalf of the Partnership. The
foregoing power of attorney is coupled with an interest, shall be irrevocable,
and shall survive and shall not be affected by the subsequent death,
incompetency, incapacity, disability, dissolution, bankruptcy, or termination
of such Limited Partner and shall extend to such Limited Partner's heirs,
successors, assigns and personal representatives.

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ARTICLE VIII

Books, Records, Capital Accounts and Reports

Section 8.1. Books and Records; Capital Accounts.

(a) Except as may otherwise be required by this Agreement, the
Chief Executive Officer shall keep books of account in accordance with
generally accepted accounting principles on an accrual basis in accordance with
the terms of this Agreement. Such books shall be maintained at the principal
United States office of the Partnership. The calendar year shall be selected as
the accounting year of the Partnership.

(b) An individual capital account (a "Capital Account") shall be
maintained by the Partnership for each Partner as provided below:

(i) The Capital Account of each Partner shall, except as
otherwise provided herein, be (A) credited with the amount of any cash
contributed to the Partnership by such Partner; (B) credited with the
fair market value of any property contributed to the Partnership by
such Partner (net of liabilities secured by such contributed property
that the Partnership is considered to assume or take subject to under
Section 752 of the Internal Revenue Code), (C) credited with the
amount of any item of taxable income or gain and the amount of any
item of income or gain exempt from tax allocated to such Partner under
Section 4.3, (D) credited with the Partner's share of Simulated Gain
as provided in Section 8.1(b)(ii), (E) debited by the amount of any
item of tax deduction or loss allocated to such Partner under Section
4.3, (F) debited with the Partner's share of Simulated Loss and
Simulated Depletion as provided in Section 8.1(b)(ii), (G) debited by
such Partner's allocable share of expenditures described in Section
705(a)(2)(B) of the Internal Revenue Code, and (H) debited by the
amount of cash or the fair market value of any property distributed to
such Partner (net of liabilities secured by such distributed property
that such Partner is considered to assume or take subject to under
Section 752 of the Internal Revenue Code). Immediately prior to any
distribution of property by the Partnership that is not pursuant to a
liquidation of the Partnership or all or any portion of a Partner's
interest therein, the Partners' Capital Accounts shall be adjusted by
(Y) assuming that the distributed assets were sold by the Partnership
for cash at their respective fair market values as of the date of
distribution by the Partnership, and (Z) crediting or debiting each
Partner's Capital Account with its respective share of the
hypothetical gains or losses, including Simulated Gains and Simulated
Losses, resulting from such assumed sales in the same manner as gains
or losses on actual sales of such properties would be credited or
debited to such Partner's Capital Account. Notwithstanding the
foregoing sentence, the Partnership shall not distribute property in
kind to any Partner except as provided in Section 11.2.

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(ii) The allocation of basis prescribed by Section
613A(c)(7)(D) of the Internal Revenue Code and provided for in Section
4.3(b) and each Partner's separately computed depletion deductions
shall not reduce such Partner's Capital Account, but each Partner's
Capital Account shall be debited by an amount equal to the product of
the depletion deductions that would otherwise be allocable to the
Partnership in the absence of Section 613A(c)(7)(D) of the Internal
Revenue Code (computed without regard to any limitations that
theoretically could apply to any Partner) times such Partner's
percentage share of the adjusted basis of the Depletable Property with
respect to which such depletion is claimed (herein called "Simulated
Depletion"). The Partnership's basis in any Depletable Property, as
adjusted from time to time for Simulated Depletion allocable to all
Partners (and where the context requires, each Partner's allocable
share thereof, which share shall be determined in the same manner as
the allocation of basis prescribed in Section 4.3(b)) is herein called
"Simulated Basis." No Partner's Capital Account shall be decreased,
however, by Simulated Depletion deductions attributable to any
Depletable Property to the extent such deductions exceed such
Partner's allocable share of the Partnership's Simulated Basis in such
Depletable Property. The Partnership shall compute simulated gain
("Simulated Gain") or simulated loss ("Simulated Loss") attributable
to the sale or other disposition of a Depletable Property based on the
difference between the amount realized from such sale or other
disposition and the Simulated Basis of such Depletable Property, as
theretofore adjusted. Any Simulated Gain shall be allocated to the
Partners and shall increase their respective Capital Accounts in the
same manner as the amount realized from such sale or other disposition
in excess of Simulated Basis shall have been allocated pursuant to
Section 4.3(b). Any Simulated Loss shall be allocated to the Partners
and shall reduce their respective Capital Accounts in the same
percentages as the costs of the Depletable Property sold were
allocated up to an amount equal to each Partner's share of the
Partnership's Simulated Basis in such Depletable Property at the time
of such sale.

(iii) Any adjustments of basis of Partnership property
provided for under Sections 734 and 743 of the Internal Revenue Code
and comparable provisions of state law (resulting from an election
under Section 754 of the Internal Revenue Code or comparable
provisions of state law) and any election by any Partner under Section
59(e)(4) of the Internal Revenue Code to amortize such Partner's share
of intangible drilling and development costs shall not affect the
Capital Accounts of the Partner, and the Partners' Capital Accounts
shall be debited or credited pursuant to the terms of this Section 8.1
as if no such election had been made.

(iv) Capital Accounts shall be adjusted, in a manner
consistent with this Section 8.1, to reflect any adjustments in items
of Partnership income, gain, loss or deduction that result from
amended returns filed by the Partnership or pursuant to

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an agreement by the Partnership with the Internal Revenue Service or
a final court decision.

(v) In the case of property contributed to the
Partnership by a Partner, the Partners' Capital Accounts shall be
debited or credited in accordance with Treasury Regulation Section
1.704-1(b)(2)(iv)(g) for items of depreciation, cost recovery,
Simulated Depletion, amortization, and gain or loss (including
Simulated Gain and Simulated Loss) with respect to such property
computed in the same manner as such items would be computed if the
adjusted tax basis of such property were equal to its fair market
value on the date of the contribution of the property to the
Partnership, in lieu of the adjustments to the Capital Accounts
otherwise provided in this Section 8.1(b) for such items.

(vi) To the extent any additional adjustment to the
Capital Accounts is required by Treasury Regulation Section
1.704-1(b)(2)(iv), the Managing General Partner is hereby authorized
to make such adjustment after consultation with the Partnership's
accountants and notice to the other Partners.

Section 8.2. Reports. The Chief Executive Officer shall deliver to the
Partners the following financial statements and reports at the times indicated
below:

(a) Annually, within 120 days after the end of each fiscal year of
the Partnership, unaudited financial statements of the Partnership for such
fiscal year, which unaudited financial statements shall be prepared in
accordance with generally accepted accounting principles and shall set forth,
as of the end of and for such fiscal year, a profit and loss statement and a
balance sheet of the Partnership, and such other information as, in the
judgment of the Chief Executive Officer, shall be reasonably necessary for the
Partners to be advised of the financial status and results of operations of the
Partnership;

(b) Annually, by March 31 of each year or as soon thereafter as is
reasonably possible, a report containing such information as may be reasonable
to enable each Partner to prepare and file his federal income tax return and
any required state income tax return.

(c) Such other reports and financial statements as the Chief
Executive Officer shall determine or as General Atlantic shall reasonably
request from time to time.

Section 8.3. Data and Information Relating to Partnership. During the
term of the Partnership, each Partner shall have during ordinary business hours
reasonable access to, and the right to inspect and audit at such Partner's
expense, all books and records of the Partnership. Each Partner shall also have
the right to consult with the Partnership's accountants with respect to
Partnership accounting and tax issues.

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ARTICLE IX

Assignments of Interests and Substitutions

Section 9.1. Assignments by Limited Partners.

(b) In the event of an assignment complying with the provisions of
subsection (a) above, unless an assignee becomes a substituted Limited Partner
in accordance with the provisions set forth below, such assignee shall not be
entitled to any of the rights granted to a Limited Partner hereunder, other
than the right to receive allocations of income, gain, loss, deduction, credit
and similar items and distributions to which the assignor would otherwise be
entitled to the extent such items are assigned.

(c) An assignee of the interest of a Limited Partner, or any
portion thereof, shall become a substituted Limited Partner entitled to all of
the rights of the Limited Partner if, and only if (i) the assignor gives the
assignee such right, (ii) the Managing General Partner consents to such
substitution, the granting or denying of which shall be in the Managing General
Partner's sole and absolute discretion, (iii) the assignee is able to and does
make all the representations and warranties contained in Section 12.1,
including without limitation that it is eligible to acquire and hold Federal
oil and gas leases in compliance with all applicable laws, and in Section 12.2,
if acquired at such time and (iv) the assignee executes and delivers such
instruments, in form and substance reasonably satisfactory to the Managing
General Partner, as the Managing General Partner may deem necessary or
desirable to effect such substitution and to confirm the agreement of the
assignee to be bound by all of the terms and provisions of this Agreement. Upon
the satisfaction of such requirements, the Managing General Partner shall
concurrently (or as of such later date as shall be provided for in any
applicable written instruments furnished to the Managing General Partner) admit
any such assignee as a substituted Limited Partner of the Partnership and
reflect such admission and the date thereof in the records of the Partnership.

(d) Any purported assignment or transfer not in accordance with
the provisions of this 9.1 shall be ineffective against the Partnership and the
other Partners.

(e) Any transfer by Carter to his Permitted Transferees shall also
be subject to the provisions of Section 9.6.

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Section 9.2. Assignment by General Partners.

(a) Subject to Sections 6.1(d), 9.5 and 9.8 if applicable, and
except as provided below, the interest of a General Partner in the Partnership
may be assigned, mortgaged, pledged, hypothecated, subjected to a security
interest or otherwise encumbered, in whole or in part, without the prior
written consent of the other Partners. Notwithstanding the foregoing, any such
assignment, mortgage, pledge, security interest or encumbrance, including any
mortgage, pledge or assignment provided for in subsection (b) of this Section
9.2, which, with respect to General Atlantic, represents either alone or
together with all prior transfers made by General Atlantic, more than 50% of
its interest in the Partnership on the Effective Date and with respect to BEC,
represents either alone or together with all prior transfers made by BEC, more
than 50% of its interest in the Partnership on the Effective Date, shall be
subject to the following requirements: (i) without the written consent of the
other General Partner, the granting or denying of which shall be in such
General Partner's sole and absolute discretion, such assignee shall not be
substituted as a General Partner and shall not be entitled to any rights of the
transferring General Partner hereunder, other than a right to receive the
applicable share of the profits, losses, cash distributions and returns of
capital to which the assigning General Partner would otherwise be entitled;
(ii) such assignee shall take such interest subject to all of the terms and
provisions of this Agreement, including without limitation the provisions of
Section 9.5; and (iii) such assignee is able to and does make all the
representations and warranties contained in Section 12.1, including without
limitation that it is eligible to acquire and hold Federal oil and gas leases
in compliance with all applicable laws.

(b) Brigham covenants and agrees that neither he, Anne Brigham nor
their Permitted Transferees will mortgage, pledge or otherwise encumber more
than an aggregate of 49.99% of the outstanding capital stock or any securities
convertible into or exchangeable therefor of BEC, and will cause BEC not to,
and BEC covenants and agrees not to, mortgage, pledge or otherwise encumber
more than an aggregate of 49.99% of its Post Threshold Ratio interest in the
Partnership such that, in either or both cases, prior to the fifth anniversary
of the Effective Date, no more than an aggregate of 49.99% of BEC's Post
Threshold Ratio interest shall be directly or indirectly mortgaged, pledged or
otherwise encumbered. BEC agrees not to otherwise sell, assign or otherwise
transfer (collectively "assign") its interest as a General Partner of the
Partnership for a period of three (3) years from the Effective Date; provided
that (i) after such date and for period of twelve months thereafter, BEC may
assign up to a five (5) percent Post Threshold Ratio interest, (ii) after the
expiration of such four year period and for a period of twelve additional
months thereafter BEC may assign an additional five (5) percent Post Threshold
Ratio interest or an aggregate 10% Post Threshold Ratio interest, and (iii)
after the expiration of such five year period, BEC may assign all of its
interests hereunder.

Section 9.3. Apportionment Between Assignor and Assignee. In the event
of an assignment of a Partner's interest in the Partnership, there shall be an
interim closing of the

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Partnership's books and Partnership items of income, gain, loss, deduction and
credit allocable to such interest under Article IV for that part of the taxable
year in which the assignor was a Partner shall be allocated to the assignor,
and for that part of the taxable year in which the assignee is a Partner shall
be allocated to the assignee.

Section 9.4. Merger or Consolidation. Notwithstanding the provisions
of Section 9.1 or 9.2, but subject to Section 12.3(b), the merger or
consolidation by a Partner with another corporation pursuant to which such
Partner is the surviving corporation shall not be considered an assignment of
an interest in the Partnership, and upon the merger or consolidation of such
Partner, the resulting corporation shall continue as a Partner.

Section 9.5. Right of First Offer.

(a) In the event Carter desires to sell all or any portion of his
interest in the Partnership other than to Permitted Transferees, Carter shall
first offer to sell such portion of his interest in the Partnership to BEC in
accordance with the terms of this Section 9.5. The offer to sell (herein so
called) to BEC (i) shall be in writing and shall grant to BEC the right to
purchase such interest for the consideration (which shall be expressed in
monetary terms in cash), unless otherwise agreed by BEC and on the terms as set
forth therein, and (ii) shall not expire until the date 30 days from the date
BEC receives the offer (the "Expiration Date"). BEC shall have the prior right
and option to accept the offer to purchase the portion of Carter's interest in
the Partnership so offered during the 30-day period ending on the Expiration
Date.

(b) The date the offer to sell is accepted by BEC shall be the
date the notice of acceptance is postmarked (or, if not mailed, the date Carter
acknowledges in writing receipt of the notice of acceptance). Acceptance of the
offer shall be effective only if BEC accepts the offer to purchase the entire
portion of Carter's interest in the Partnership so offered. If the offer to
sell is not accepted by BEC, Carter may transfer that portion of its interest
in the Partnership to which the offer to sell pertains to any transferee
(subject to the provisions of subsection (d) below and, the requirements of
Section 9.1(c) and Section 9.8) on terms and conditions no more favorable to
the transferee than those contained in the offer to sell at any time during a
period that shall end 180 days after the Expiration Date, provided that the
transferee thereof shall execute and deliver to BEC a valid and binding
agreement to the effect that the interest in the Partnership so transferred
shall continue to be subject to the provisions of this Section 9.5 and that the
right of first offer of BEC shall extend to any proposed disposition of such
interest by the transferee. If, however, no sale to a transferee is consummated
during the period that ends 180 days after the Expiration Date, BEC's right of
first refusal as to the portion of Carter's interest in the Partnership to
which the offer to sell pertains shall continue in full force and effect and
any proposed transfer thereof shall first be subject to BEC's right of first
offer as set forth in this Section 9.5. Additionally, the sale to a transferee
of the portion of Carter's interest in the Partnership to which the offer to
sell pertains in accordance with the provisions of this

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Section 9.5 shall not affect BEC's right of first offer pursuant to this
Section 9.5 with respect to the remainder of Carter's interest in the
Partnership.

(c) In the event that BEC elects to purchase that portion of
Carter's interest in the Partnership to which the offer to sell pertains, BEC
and Carter shall be bound to proceed with the sale for the consideration and
upon the terms applicable thereto, which shall be consummated at such location
as shall be agreed upon by BEC and Carter on or before the first business day
after the expiration of 90 days from the date of BEC's acceptance of the offer
to sell. At the time of closing, BEC shall deliver such consideration as
required pursuant to the offer to sell and Carter shall deliver or cause to be
delivered to BEC, against receipt of such consideration, such assignments and
other instruments of conveyance, warranty of title, transfer and assignment of
the portion of Carter's interest in the Partnership to be conveyed hereunder as
shall be effective to vest in BEC good title and interest in and to such
interest in the Partnership, free and clear of any and all liens, encumbrances,
conditions, assessments, and restrictions (to the extent consistent with the
offer to sell). From the time of such closing, Carter, from time to time at the
request of BEC and without further consideration, shall do, execute,
acknowledge and deliver, or shall cause to be done, executed, acknowledged and
delivered, all such further acts, deeds, assignments, transfers, conveyances,
powers of attorney and assurances as BEC may reasonably require more
effectively to convey, assign, transfer, or confirm the interest in the
Partnership so conveyed to BEC, its successors and assigns.

(d) If BEC does not exercise its right to purchase Carter's
interest hereunder, the Partnership shall have the same right to purchase such
interest on the same terms as set forth above and if the Partnership does not
exercise its second right to purchase Carter's interest, General Atlantic shall
have a third right to purchase such interest on the same terms as set forth
above.

(e) Additionally, if GAP L.P. should desire to sell all or any
portion of its interest in the Partnership (other than to GA Permitted
Transferees), General Atlantic shall have the first right of refusal to
purchase same, the Partnership shall have the second right of refusal and BEC
shall have the third right of refusal to purchase such interest all on the
terms and in accordance with the procedures set forth in subsections (a)
through (c) above, which provisions shall apply mutatis mutandis.

(f) Likewise, if General Atlantic should desire to sell all or any
portion of its interest in the Partnership other than to GA Permitted
Transferees, BEC shall have the first right of refusal to purchase such
interest and if BEC should desire to sell all or any portion of its interest in
the Partnership other than to its Permitted Transferees, General Atlantic shall
have the first right of refusal to purchase such interest on the terms and in
accordance with the procedures set forth in subsections (a) through (c) above,
which provisions shall apply mutatis mutandis.

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Section 9.6. Death of Carter. Upon the death of Carter, BEC and/or
Brigham shall have the option for 90 days thereafter to buy, and upon the
exercise of such option, Carter's estate and/or his Permitted Transferees as
applicable, (herein collectively referred to as "Carter Holders") shall sell,
Carter's interest in the Partnership for an amount equal to the fair market
value of such interest (as defined below), payable as hereinafter provided. The
payment to be made to the Carter Holders pursuant to this Section 9.6 is, and
shall be conclusively deemed to be, in complete liquidation and satisfaction of
all of the rights and interest of Carter and Carter Holders (and of any and all
persons claiming by, through or under Carter and of the estate of the deceased
Limited Partner) in and in respect of the Partnership, including without
limitation, any interest in the Partnership, any rights in specific Partnership
property, and any rights against the Partnership and (insofar as the affairs of
the Partnership are concerned) against the General Partner. If BEC exercises
its option to buy the Carter Holders' interest in the Partnership pursuant to
this Section 9.6, BEC and/or Brigham and the Carter Holders and their legal
representatives shall proceed to close the purchase at such time and place as
is mutually acceptable, but in no event later than 60 days from the date on
which BEC and/or Brigham exercises its option pursuant to this Section 9.6.

Section 9.7. Death of Carter's Spouse; Termination of Marital
Relationship; Partition of Community Property.

(a) The spouse of a Limited Partner is not a Partner in the
Partnership.

(b) If Carter's spouse predeceases him and he does not succeed by
his spouse's last will and testament (unless Carter controls such interest by
proxy or trust) or by operation of law to any interest the Spouse may have in
such interest in the Partnership (the "Spouse's Fraction"), Carter shall have
the option for 60 days after the death of his spouse to buy, and upon the
exercise of such option, such spouse's estate shall sell, the Spouse's Fraction
in the Partnership for an amount equal to the fair market value (as defined
below). If such option is not exercised by Carter, BEC shall have the option
for 15 days after the expiration of Carter's option to purchase the Spouse's
Fraction for the same amount and upon the same terms set forth in the
immediately preceding sentence.

(c) Upon the termination of the marital relationship of Carter
other than by death, or upon the partition of the community property between
Carter and his spouse for any reason, Carter shall have the option for 60 days
after such termination or partition to buy, and upon the exercise of such
option Carter's spouse or former spouse shall sell, the Spouse's Fraction in
the Partnership for an amount equal to the fair market value. If such option is
not exercised by Carter, BEC shall have the option for 30 days after the
expiration of Carter's option to purchase the Spouse's Fraction for the same
amount and upon the same terms set forth in the immediately preceding sentence.

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(d) The payment to be made to the spouse or former spouse of
Carter or such spouse's estate pursuant to subsection (b) or (c) above (as
appropriate), is, and shall be conclusively deemed to be, in complete
liquidation and satisfaction of all the rights and interest of the spouse or
former spouse of Carter or such spouse's estate (and of any and all persons
claiming by, through, or under the spouse or former spouse of Carter or such
spouse's estate) in and in respect of the Partnership, including, without
limitation, any interest in the Partnership, any rights in specific Partnership
property, and any rights against the Partnership and (insofar as the affairs of
the Partnership are concerned) against the Partners.

(e) If BEC exercises its option pursuant to either subsection (b) or
(c) above, BEC and the spouse or former spouse or the legal representatives of
the spouse's estate, as appropriate, shall proceed to close the purchase at
such time and place as is mutually acceptable, but in no event later than 60
days from the date on which BEC exercises its option pursuant to either
subsection (b) or (c) above.

The purchase price of any interest in the Partnership repurchased
pursuant to Section 9.6 or 9.7 shall be the fair market value of such interest
on the date the notice of election to repurchase such interest was sent
pursuant to Section 9.6 or 9.7. Such fair market value shall be determined not
later than 30 days or such other period as is mutually agreeable to buyer and
seller after notice has been received by Carter of the election to purchase
such interest in the Partnership, and shall be determined by an appraiser
mutually agreeable to the purchaser and seller, provided that if the purchaser
and seller cannot agree on an appraiser within 20 days, each shall select an
appraiser and those appraisers shall select a third appraiser which shall make
the determination of fair market value. The purchase price of an interest in
the Partnership purchased by Carter shall be payable in thirty-six (36) equal
monthly installments with interest at a fixed rate of 2% over the prime rate of
interest of Texas Commerce Bank National Association, Dallas Branch per annum.
The purchase price of an interest in the Partnership purchased by BEC, Brigham
or the Partnership shall be payable, at the election of the Partnership, (A) by
payment of the full purchase price in cash, or (B) by the execution and
delivery of a promissory note in the amount of such balance, payable to the
order of the seller, the principal to be due and payable in thirty-six (36)
equal monthly installments with interest at a fixed rate of 2% over the prime
rate of interest of Texas Commerce Bank National Association, Dallas Branch per
annum (accrued interest being payable at the time of each principal payment).
In any case in which the purchase price for an interest purchased by BEC or
Brigham is not paid in full in cash, the interest purchased may, at the option
of the seller, be pledged to the seller as security for the timely and full
payment of the balance of the purchase price pursuant to the terms of a
security agreement.

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Section 9.8. Co-Sale Rights.

(a) In the event either BEC, in compliance with Section 9.2, or Carter
in compliance with Section 9.1, shall determine to sell any portion of their
Equity Securities, other than (i) with respect to a transfer to their
respective Permitted Transferees; (ii) with respect to a transfer to the
Partnership or another Partner pursuant to the rights of first refusal in
Section 9.5; (iii) with respect to a permitted pledge or mortgage of such
Equity Securities; or (iv) with respect to a public offering of such Equity
Securities, General Atlantic and GAP L.P. at their option shall have the right
to participate on up to a pro rata basis with such Management Partners in a
sale to third parties; provided, however, that if Threshold Value has been
achieved, neither of the GA Partners shall have any co-sale rights hereunder in
respect of any sale by the Management Partners in one or more transactions of
up to an aggregate 20% Post Threshold Ratio interest. If General Atlantic and
GAP L.P. shall elect to exercise their respective rights under this Section
9.8, then they shall each be entitled to sell a pro rata portion of their Post
Threshold Ratio interest in the Partnership proportionate to the portion of the
Post Threshold Ratio interest being sold by the Management Partners.

(b) If the Threshold Value is achieved, the Management Partners shall
have the same co-sale rights with respect to sales of Equity Securities by
either of the GA Partners (other than transfers to GA Permitted Transferees)
subject to the same conditions and limitations set forth in subsection (a)
above, and the provisions of Section 9.8(a) shall apply mutatis mutandis.

ARTICLE X

Registration Rights

Section 10.1. Incidental Registration. If the Partnership at any time
proposes to register any Transfer of its Equity Securities under the Securities
Act for its own account or for the account of a security holder (other than a
registration relating to employee benefit plans, the acquisition of another
company or business, an exchange offer solely for already outstanding
securities of the Partnership, or a registration on a form that does not
require substantially the same information that would be required in a
registration statement covering a Transfer of Equity Securities held by the
General Partners), the Partnership will each such time give prompt written
notice to all Partners (herein collectively called the "Prospective Sellers")
of its intention to do so. Upon the written notification by any Prospective
Seller of an intention to register a Transfer of Equity Securities under this
Section 10.1 (stating the intended method of Transfer of such Equity Securities
by such Prospective Seller and the number of Equity Securities to be
transferred), given within twenty (20) days after receipt of any such notice
from the Partnership, the Partnership will cause such intended Transfer of all
Equity Securities of which any such Prospective Sellers

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shall have given such notice to be registered under the Securities Act. The
Partnership shall have the right to reduce or eliminate Equity Securities of a
Prospective Seller to be included pursuant to exercise of its incidental rights
under this Section 10.1 in an underwritten offering by the Partnership if, in
the good faith opinion of the managing underwriter, supported by written
reasons therefor, the inclusion of such shares would raise a substantial doubt
as to whether the proposed offering could be successfully consummated;
provided, however, that prior to the Threshold Amount being reached any
reduction of Equity Securities of a Prospective Seller to be included in an
incidental registration pursuant to the above shall be made first as to
securities requested to be sold by any Limited Partners (other than GAP L.P.)
and Management Partners until all securities requested to be sold by GA
Partners have been included in such registration. The Partnership shall
undertake to include in such a registration all of the Equity Securities
requested by the Prospective Sellers to be included in such registration that
are not eliminated from such registration by the underwriters. In the case of
an underwritten public offering by the Partnership, each Prospective Seller
participating in such incidental registration shall, if requested by the
managing underwriter, agree not to Transfer any securities of the Partnership
held by such Prospective Seller to any person other than such underwriter for a
period of up to thirty (30) days following the effective date of the
registration statement relating to such offering or such longer period as may
be reasonably requested by such underwriter, but in no event to exceed ninety
(90) days, and the Partnership hereby covenants that it will, thereafter, take
whatever actions (including amendment of its registration statement) as shall
be reasonably necessary to enable such Prospective Seller to register a
Transfer of any such securities at such time.

Section 10.2. Required Registration. Whenever the Partnership shall be
requested by General Atlantic to effect the registration under the Securities
Act of any specified Transfer of Equity Securities, which right may not be
exercised prior to an initial public offering by the Partnership, the
Partnership shall promptly give written notice of such proposed registration to
all Prospective Sellers and thereupon shall, as expeditiously as possible, use
its best efforts to effect the registration under the Securities Act of any
such Transfer of Equity Securities which any Prospective Seller has requested
to be registered. If the Partnership shall notify Prospective Sellers within
five days of the Partnership's receipt of a registration request hereunder that
the Partnership in good faith determines and informs the Prospective Sellers
that the filing of such a registration statement at that time would interfere
with a material financing or acquisition then contemplated by the Partnership
and specifies in writing the manner and extent to which such registration would
so interfere, the Partnership shall have the right to delay for a period of not
more than ninety (90) days a registration of a Transfer of Equity Securities
pursuant to the request of Prospective Sellers under this Section 10.2. If for
any reason (other than the requested withdrawal of such registration statement
by such Prospective Sellers or other action or inaction of the Prospective
Seller) any registration statement filed with the Commission with respect to
securities which the Partnership is required to register under this Section
10.2 shall not be declared effective by the Commission, such attempted
registration shall not

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constitute a registration under this Section 10.2. The Partnership may register
a Transfer on the least expensive form available. The Partnership may permit
certain third parties incidental rights subordinate to the Prospective Sellers'
rights in a registration under this Section 10.2, provided that any shares to
be included pursuant to such incidental rights may be reduced or eliminated if
in the good faith opinion of the Prospective Sellers or their managing
underwriter, if any, the inclusion of such shares would raise a substantial
doubt as to whether the proposed offering could be consummated successfully.
Any expenses required to be paid by the Prospective Sellers with respect to any
such registration shall be borne on a pro rata basis by any third parties
registering a transfer or transfers of stock pursuant to the same registration.

Section 10.3. Certain Limitations. General Atlantic shall not have the
right to request a registration under Section 10.2 for a registration of a
Transfer of Equity Securities (a) prior to the expiration of two years from the
Effective Date or (b) if the Partnership has already effected two (2)
registrations pursuant to Section 10.2. The Prospective Sellers shall not have
the right to participate in a registration under Section 10.1 unless the
Prospective Sellers provide to the Partnership a written opinion of counsel, in
substance and authorship acceptable to the Partnership, that such Prospective
Sellers may make such Transfer of all of their Equity Securities (if
applicable) in a public sale which will be in compliance with all applicable
securities laws concerning transfer of non-registered securities. All
registration rights granted in this Article X shall expire ten (10) years after
the completion of the first public offering by the Partnership.

Section 10.4. Registration Procedures. If and whenever the Partnership
is required by the provisions of this Article X to effect the registration of
any Transfer of Equity Securities under the Securities Act, the Partnership
will, as expeditiously as possible, and at its expense,

(a) prepare and file with the Commission a registration
statement with respect to such Transfer and use its best efforts to
cause such registration statement to become and remain effective for a
period of at least one hundred eighty (180) days or until the
Prospective Sellers have completed the distribution described in the
registration statement relating thereto, whichever occurs first;

(b) 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, and to comply with the provisions of the
Securities Act with respect to the Transfer of all securities covered
by such registration statement, for a period of at least one hundred
eighty (180) days or until the Prospective Sellers have completed the
distribution described in the registration statement relating thereto,
whichever occurs first;

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(c) furnish to each Prospective Seller who has requested
to use such registration statement such numbers of copies of a summary
prospectus or other prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such other
documents, as such Prospective Seller may reasonably request in order
to facilitate its intended Transfer of the Equity Securities owned by
such Prospective Seller and covered by such registration statement;

(d) register or qualify the securities covered by such
registration statement under such other securities or blue sky laws of
such jurisdictions as each Prospective Seller shall reasonably
request, and do any and all other acts and things which may be
necessary or advisable to enable such Prospective Seller to consummate
the public sale or other disposition in such jurisdictions of the
Equity Securities owned by such Prospective Seller and covered by such
registration statement;

(e) promptly upon becoming aware of such, notify each
Prospective Seller who has requested to use such registration
statement and each underwriter, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, of the
happening of any event as a result of which the prospectus contained
in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing

(f) furnish to the Prospective Sellers whose intended
Transfers are registered a signed copy of an opinion of counsel for
the Partnership, in substance and authorship acceptable to such
Prospective Sellers, to the effect that: (i) a registration statement
covering such Transfers of Equity Securities has been filed with the
Commission under the Securities Act and has been made effective by
order of the Commission, (ii) such registration statement and the
prospectus contained therein and any amendments or supplements thereto
(other than the financial statements and other financial and
statistical data included therein, as to which an expert has rendered
an opinion) comply as to form in all material respects with the
requirements of the Securities Act, and nothing has come to such
counsel's attention which would cause him to believe that the
registration statement or such prospectus contains any untrue
statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements
therein (in the case of such prospectus, in the light of the
circumstances under which they were made) not misleading, (iii) such
counsel knows of no legal or governmental proceedings required to be
described in such prospectus which are not described as required, nor
of any contract or documents of a character required to be described
in such registration statement or such prospectus or to be filed as an
exhibit to such registration statement or to be incorporated by
reference therein which is not described and filed as required, (iv) a
prospectus meeting the requirements of the Securities Act is

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available for delivery, (v) to the best of such counsel's knowledge,
no stop order has been issued by the Commission suspending the
effectiveness of such registration statement, and no proceedings for
the issuance of such a stop order are threatened or contemplated, and
(vi) the applicable provisions of the securities or blue sky laws of
each state or jurisdiction in which the Partnership shall be required,
pursuant to clause (d) of this Section 10.4, to register or qualify
such intended Transfers or the Equity Securities to be so transferred,
have been complied with, assuming the accuracy and completeness of the
information furnished to such counsel with respect to each filing
relating to such laws; it being understood that such counsel may rely,
as to all factual matters and financial data treated therein, on
certificates of the Partnership (copies of which shall be delivered to
such Prospective Sellers), and as to all questions of the laws of each
jurisdiction in which the Partnership shall be so required to register
or qualify such intended Transfers or the Equity Securities to be so
transferred, on an examination of the securities laws of such
jurisdiction and of the published rules and regulations (if any) of
the authorities administering such laws, as reported in accepted
unofficial publications and/or on an opinion of counsel from such
jurisdiction acceptable to such Prospective Sellers, copies of which
opinions shall be delivered to such Prospective Sellers; provided,
however, that the opinion of counsel for the Partnership required by
this Section 10.4(f) need not contain the opinion required by this
subsection (vi) in those situations in which the underwriter's counsel
provides such an opinion upon which the Prospective Sellers are
entitled to rely;

(g) otherwise comply with all applicable rules and
regulations of the Commission under the Securities Act, the Exchange
Act and otherwise, and make available to its security holders, as soon
as reasonably practicable, an earnings statement covering the period
of at least twelve months, but not more than eighteen months,
beginning with the first month after the effective date of the
registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act; and

(h) use its best efforts to list such securities on any
securities exchange on which any shares of Equity Securities of the
Partnership are then listed.

Section 10.5. Expenses; Limitations on Registration.

(a) All expenses incurred by the Partnership in complying with
Section 10.2, including, without limitation, all registration and filing fees,
printing expenses, fees and disbursements of counsel for the Partnership, fees
and disbursements of accountants and auditors of the Partnership with respect
to quarterly and annual financial statements of the Partnership, and expenses
of complying with the securities or blue sky laws of any jurisdictions pursuant
to Section 10.4, shall be paid by the Partnership; provided that commissions,
fees and expenses of the underwriter allocable to the securities to be
registered

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for the Prospective Sellers and costs of separate counsel shall be borne pro
rata by the Prospective Sellers.

(b) All expenses incurred by the Partnership in complying with
Section 10.1, including without limitation registration fees (federal and blue
sky), incremental underwriter commissions, fees and expenses, custody
agreements and costs of separate counsel, shall be borne by the Prospective
Sellers on a pro rata basis in accordance with their securities registered.

(c) It shall be a condition precedent to the obligation of the
Partnership to take any action pursuant to this Article X in respect of any
Transfer of Equity Securities which is to be registered at the request of any
Prospective Seller that such Prospective Seller furnish to the Partnership such
written information regarding the securities held by such Prospective Seller
and the intended method of disposition thereof as the Partnership shall
reasonably request and as shall be required in connection with the action to be
taken by the Partnership.

Section 10.6. Indemnification.

(a) In the event of any registration of any Transfer of Equity
Securities under the Securities Act pursuant to this Article X, the Partnership
shall indemnify and hold harmless each Prospective Seller of such securities,
its directors, partners and officers, each underwriter and each other person
who participates in the offering of such securities and each other person, if
any, who controls such Prospective Seller or such participating person within
the meaning of the Securities Act, against any losses, claims, damages,
expenses or liabilities, joint or several, to which such Prospective Seller or
any such director, partner or officer or participating person or controlling
person may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages, expenses or liabilities (or actions in respect
thereof) arise out of or are based upon (i) any alleged untrue statement of any
material fact contained, on the effective date thereof, in any registration
statement under which such Transfer of Equity Securities was registered under
the Securities Act, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereto, or (ii) any alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and shall reimburse such
Prospective Seller or such director, partner, officer, underwriter or
participating person or controlling person for any legal or any other expenses
incurred by such Prospective Seller or such director, partner, officer,
underwriter or participating person or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Partnership shall not be liable hereunder in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon any alleged untrue statement or alleged omission made
in such registration statement, preliminary prospectus, prospectus, or
amendment or supplement in reliance upon and in conformity with written
information furnished to the Partnership

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through an instrument duly executed by such Prospective Seller specifically for
use in connection therewith. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of such Prospective
Seller or such director, partner, officer, underwriter or participating person
or controlling person, and shall survive any Transfer of such Equity Securities
by such Prospective Seller.

(b) Each Prospective Seller shall indemnify and hold harmless each
other Prospective Seller, the Partnership, its directors, partners and
officers, each underwriter and each other person who participates in the
offering of Equity Securities, and each other person, if any, who controls the
Partnership within the meaning of the Securities Act, against any losses,
claims, damages, expenses or liabilities, joint or several, to which the
Partnership or any such director, partner or officer or any such controlling
person or Prospective Seller may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon:

(i) any alleged untrue statement of any material fact
contained, on the effective date thereof, in any registration
statement under which a Transfer of Equity Securities was registered
under the Securities Act at the request of such Prospective Seller,
any preliminary prospectus or final prospectus contained therein, or
any amendment or supplement thereto, or

(ii) any alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the
extent, that such alleged untrue statement or alleged omission was
made in such registration statement, preliminary prospectus, final
prospectus, amendment or supplement in reliance upon and in conformity
with written information furnished to the Partnership through an
instrument duly executed by such indemnifying Prospective Seller
specifically for use in connection therewith, and shall reimburse the
Partnership or such director, officer, controlling person or
Prospective Seller for any legal or any other expenses reasonably
incurred in connection with investigating or defending any such loss,
claim, damage, liability or action.

(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect hereof is to be made against the indemnifying party hereunder,
notify the indemnifying party in writing thereof, but the failure so to notify
the indemnifying party shall not relieve it from any liability which it may
have to any indemnified party hereunder. In any proceeding in which
indemnification is sought pursuant to Section 10.6(a) and (b) above, the
indemnifying party may (i) participate at its own expense in the defense or,
(ii) if it so elects, jointly with any other indemnifying party similarly
notified, assume the defense of any suit or administrative or other proceeding
brought to enforce or determine liability. After notice by an indemnifying
party of its election to assume the defense of a suit or administrative or
other

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proceeding, the indemnifying party shall not be liable for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense, except to the extent that the indemnified party has additional
defenses not available to the indemnifying party, in which event the costs and
expenses of one attorney or law firm for the indemnified party will be borne by
the indemnifying party.

(d) The indemnifying party need not indemnify any person for any
payment made in settlement of any suit or claim unless the payment is consented
to by the indemnifying party, which consent shall not be unreasonably withheld.

ARTICLE XI

Dissolution, Liquidation and Termination

Section 11.1. Dissolution. The Partnership shall be dissolved upon the
occurrence of any of the following:

(a) The occurrence of December 31, 2012.

(b) The consent in writing of the General Partners at any time.

(d) The occurrence of an event of withdrawal from the Partnership
by a General Partner as provided for in Sections 17-402 of the Delaware Revised
Limited Partnership Act.

(e) The occurrence of any event which under the Act causes the
dissolution of a limited partnership.

(f) At the election of General Atlantic, if at any time BEC should
cease being a general partner of the Partnership.

In the event of a dissolution of the Partnership as a result of the occurrence
of an event under Section 11.1(d) or in the event of a voluntary withdrawal by
a General Partner, a Majority in Interest of the remaining Partners shall be
entitled to reconstitute and continue the business of the Partnership and if
there are no remaining General Partners, to elect and substitute a new General
Partner.

Section 11.2. Liquidation and Termination. Upon dissolution of the
Partnership, the Managing General Partner shall act as liquidator or may
appoint in writing one or more

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liquidators who shall have full authority to wind up the affairs of the
Partnership and make final distribution as provided herein; provided, however,
that if one of the events specified in Section 11.1(d) or (f) has occurred as a
result of an act by the Managing General Partner, the liquidator shall be a
person selected in writing by the other Partners. The liquidator shall continue
to operate the Partnership properties with all of the power and authority of
the Chief Executive Officer and the Managing General Partner. The steps to be
accomplished by the liquidator are as follows:

(a) As promptly as possible after dissolution and again after
final liquidation, the liquidator shall cause a proper accounting to be made of
the Partnership's assets, liabilities and operations through the last day of
the month in which the dissolution occurs or the final liquidation is
completed, as appropriate.

(b) The liquidator shall pay all of the debts and liabilities of
the Partnership (including all expenses incurred in liquidation and any
advances made by the General Partners pursuant to Section 3.6) or otherwise
make adequate provision therefor (including without limitation the
establishment of a cash escrow fund for contingent liabilities in such amount
and for such term as the liquidator may reasonably determine). After making
payment or provision for all debts and liabilities of the Partnership, the
Partners' Capital Accounts shall then be adjusted by (i) assuming the sale of
all remaining assets of the Partnership for cash at their respective fair
market values (as determined by an appraiser selected by the liquidator) as of
the date of termination of the Partnership, and (ii) debiting or crediting each
Partner's Capital Account with its respective share of the hypothetical gains
or losses (including Simulated Gains and Simulated Losses) resulting from such
assumed sales in the same manner as each such Capital Account would be debited
or credited under Section 8.1(b) on actual sales of such assets. The liquidator
shall then by payment of cash or property (valued as of the date of termination
of the Partnership at its fair market value by the appraiser selected in the
manner provided above) distribute to the Partners such amounts as are required
to pay the positive balances of their respective Capital Accounts. If the
dissolution of the Partnership is an event of withdrawal of one of the General
Partners, a Majority in Interest of the other General Partners may determine
whether distributions in liquidation of the Partnership will be made in kind or
in cash. In the event of a dissolution of the Partnership by judicial decree,
distributions in liquidation of the Partnership will be made in cash unless all
General Partners agree to the distribution of properties. Otherwise, such
distributions shall be in kind or in cash as determined by the Management
Committee. No Partner with a negative balance in its Capital Account shall be
liable to the Partnership or any other Partner for the amount of such negative
balance upon dissolution and liquidation, except to the extent of any unpaid
Capital Contributions that are required to be contributed by such Partner under
Article III. Any distribution to the Partners in liquidation of the Partnership
shall be made by the later of the end of the taxable year in which the
liquidation occurs or 90 days after the date of such liquidation. For purposes
of the preceding sentence, the term "liquidation" shall have the same meaning
as set forth in Treasury Regulation Section 1.704-1(b)(2)(ii) as in effect at
such time. Each

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Partner shall have the right to designate another person to receive any
property which otherwise would be distributed in kind to that Partner pursuant
to this Section 11.2.

(c) Any Leases distributed to the Partners shall be subject to the
operating agreements then in effect with respect to such Leases; provided,
however, that if any of such Leases are not subject to an operating agreement
to which an unaffiliated third person is a party, such Leases shall be subject
to a standard form operating agreement (including an accounting procedure) as
shall be determined by the Management Committee. Upon written request made by
any Partner, the liquidator shall sell the Partnership Leases and other
properties and assets that otherwise would be distributable to such Partner
under this Section 11.2 at the best cash price available therefor and
distribute such cash (after deducting all expenses reasonably relating to such
sale, which shall include a reasonable charge for the liquidator's services
associated therewith) to such Partner. Any gain or loss attributable to the
sale shall be allocated to such Partner.

(d) Except as expressly provided herein, the liquidator shall
comply with any applicable requirements of the Act and all other applicable
laws pertaining to the winding up of the affairs of the Partnership and the
final distribution of its assets.

The distribution of cash and/or property to the Partners in accordance
with the provisions of this Section 11.2 shall constitute a complete return to
the Partners of their Capital Contributions and a complete distribution to the
Partners of their interests in the Partnership and all Partnership property.

Section 11.3. Cancellation of Certificate. Upon the completion of the
distribution of Partnership assets as provided herein, the Partnership shall be
terminated, and the liquidator (or the Partners if necessary) shall cause the
cancellation of the certificate of limited partnership of the Partnership and
shall take such other actions as may be necessary to terminate the Partnership.

ARTICLE XII

Representations and Warranties

Section 12.1. Representations and Warranties of Partners. Each Partner
hereby represents, warrants and covenants as follows:

(a) If an entity, such Partner is duly organized or formed,
validly existing and in good standing under the laws of its state of
organization and will remain in existence and good standing during the term of
this Agreement.

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(b) Such Partner has the right, power and authority to enter into
this Agreement, and with respect to BEC, the Conveyances, to become a Partner
and to perform its obligations under this Agreement, and with respect to BEC,
the Conveyances, and this Agreement, and with respect to BEC, the Conveyances,
are legal, valid and binding obligations of such Partner.

(c) The execution and delivery of this Agreement does not violate
or conflict with the charter or bylaws or partnership agreement of such Partner
or any agreement, judgment, license, permit, order or other document applicable
to or binding upon such Partner or any of its properties; and no consent,
approval, authorization or order of any court or governmental authority or
third party is required with respect to such Partner in connection with the
execution and delivery of this Agreement. The execution and delivery of the
Conveyances does not violate or conflict with the charter of bylaws of BEC or,
except for the Permitted Encumbrances, any material agreement, judgment,
license, permit, order or other document applicable to or binding upon BEC. No
consent, approval or authorization of any court or governmental authority or
third party is required with respect to BEC in connection with the execution
and delivery of the Conveyances, other than those included in the Permitted
Encumbrances, those listed in Exhibit H and consents to assign with respect to
Leases.

(d) The execution, delivery and performance of this Agreement by
such Partner do not contravene or result in any breach of or constitute a
default under any applicable law, rule or regulation or any loan, note or other
agreement or instrument to which it is a party or by which it or any of its
properties are bound. Except with respect to the Permitted Encumbrances and the
Line of Credit (as defined below), the execution, delivery and performance of
the Conveyances by BEC do not contravene or result in any breach of or
constitute a default under any applicable law, rule or regulation or any loan,
note or other agreement or instrument to which it is a party or by which it or
any of its properties are bound. BEC covenants and agrees to cause the
Partnership to apply such of the initial Capital Contributions of the
Partnership as are necessary to repay BEC's line of credit with Parker Square
Bank in full (which line of credit does not exceed $60,000) (the "Line of
Credit") as soon as possible and in no event later than five (5) days from the
Effective Date and to obtain the release of those Leases securing the payment
of such Line of Credit.

(e) When delivered, this Agreement and, with respect to BEC, the
Conveyance will be duly and validly executed by such Partner and will be
binding upon such Partner in accordance with the terms hereof and thereof, as
applicable.

(f) Except for a change of law over which the affected Partner has
no control (and the affected Partner shall immediately notify the other Partner
when the affected Partner learns of such occurrence), the foregoing
representations, warranties and covenants shall remain true and accurate during
the term of the Partnership, and such Partner will

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neither take action nor permit action to be taken which would cause any of the
foregoing representations to become untrue or inaccurate.

(g) Neither such Partner nor any of its Affiliates has employed or
retained any broker, agent or finder in connection with this Agreement or the
transactions contemplated herein, or paid or agreed to pay any brokerage fee,
finder's fee, commission or similar payment to any person on account of this
Agreement or the transactions provided for herein; and each Partner shall
indemnify and hold harmless each other Partner from any costs, including
attorneys' fees, and liability arising from the claim of any broker, agent or
finder employed or retained by such Partner.

(h) Such Partner and its Affiliates and persons acting on their
behalf have not taken any action, or failed to take any action, which has
caused the organization of the Partnership and the issuance of the interests in
the Partnership to come within the registration requirements of the Securities
Act of 1933, as amended, or any applicable state blue sky laws.

(i) It is eligible to acquire and hold federal oil and gas Leases.

Section 12.2. Additional Representation and Warranty of Limited
Partners. Each Limited Partner additionally represents, warrants and covenants
to the General Partners as follows: It is acquiring its interest in the
Partnership as an investment and not with a view to the resale or other
distribution to the public.

Section 12.3. Additional Representations and Warranties of Brigham and
BEC.

(a) Brigham represents that as of the Effective Date, all of the
authorized and outstanding capital stock of BEC is owned 100% by Ben M. Brigham
and Anne L. Brigham.

(b) Brigham covenants an agrees that during such time frame as BEC
(including any successor thereto in accordance with Section 9.4) owns any
interest in the Partnership, all of the authorized and outstanding capital
stock of BEC and all securities and commitments of any kind exchangeable for or
convertible into the capital stock of BEC shall be owned beneficially and
legally by Ben M. Brigham, Anne L. Brigham and their Permitted Transferees.

(d) BEC and Brigham represent and warrant that as long as BEC is a
General Partner of the Partnership, it will not engage directly or indirectly
in any business or conduct any activities other than as necessary or desirable
to act as a General Partner of the Partnership.

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(e) Prior to the Effective Date, BEC engaged in no business and
conducted no activities except in connection with the exploration for oil and
gas, including without limitation, the geophysical and exploration agreements
and the Leases to which it is or was a party.

(f) The unaudited balance sheet of BEC as of January 1, 1992 is
correct and complete in all material respects and fairly presents the financial
condition of BEC as of such date.

(g) Except as disclosed in Exhibit C, there are no suits, actions
or proceedings pending or, to the best knowledge of Brigham, threatened, which
relate to or affect any of the assets of the Business and which, individually
or in the aggregate, would have a material adverse effect on the business of
BEC.

(h) To the best of its knowledge, BEC is conducting its business
in substantial compliance with all permits, licenses, approvals and
authorizations of all governmental and regulatory authorities and agencies
necessary for it to carry on such business as currently conducted. To the best
of its knowledge, BEC is in compliance in all material respects with all laws,
rules and regulations applicable to its business, properties and assets.

(i) Each of the geophysical and exploration agreements listed in
Exhibit E are in full force and effect in respect of BEC and are legal, valid
and binding obligations of BEC, enforceable in accordance with their terms.
Neither BEC nor to the best of BEC's knowledge, any other party thereto is in
default in any material respect under any of such agreements. BEC has not
waived any material rights under any of such agreements, except as disclosed on
Exhibit E. Subject to Section 5.1(b), BEC will contribute and transfer, convey
and assign to the Partnership all of its right, title and interest in and to
the Leases, subject to all agreements (and commitments to enter into
agreements) now in effect and other obligations now in existence with respect
to such Leases. To the best of BEC's knowledge, each such Lease is in full
force and effect in accordance with its terms (except for any terminations
thereof which have occurred in accordance with any such terms), BEC is not in
material default under the terms of any of such Leases and BEC has not waived
any material rights under any of such Leases.

(j) To the best of its knowledge, BEC has no material liabilities
or obligations, other than (i) as set forth on the Balance Sheet attached
hereto as Exhibit A, (ii) liabilities and obligations incurred subsequent to
the date of such Balance Sheet in the ordinary course of business or listed on
Exhibit B hereto, or (iii) liabilities disclosed in the Schedule of Litigation
attached hereto as Exhibit C.

(k) BEC warrants that there are no taxes payable with in the State
of Texas with respect to the contribution of and transfer of the Business by
BEC to the Partnership.

-66-
<PAGE> 72
(l) BEC covenants to provide General Atlantic an unaudited balance
sheet of BEC as of May 1, 1992 by June 15, 1992, which balance sheet shall be
correct and complete in all material respects and shall fairly present the
financial condition of BEC as of such date.

Section 12.4. Additional Covenants of General Atlantic. General
Atlantic covenants and agrees not to withdraw as a General Partner of the
Partnership until such time as Brigham is not an officer of the Partnership or
a Representative on the Management Committee.

ARTICLE XIII

Miscellaneous

Section 13.1. Notices. Except as otherwise expressly provided in this
Agreement, all notices, demands, requests, or other communications required or
permitted to be given pursuant to this Agreement shall be in writing and shall
be given either (a) in person, (b) by United States mail, certified or
registered, return receipt requested, postage prepaid, (c) by prepaid telegram,
telex, cable, telecopy, or similar means (with signed confirmed copy to follow
by mail) or (d) by expedited delivery service with proof of delivery. Notice
shall be deemed to have been given either (i) at the time of personal delivery,
(ii) in the case of mail, within three days after deposit in the United States
mails in accordance with subsection (b) above, or (iii) in the case of other
forms of delivery, as of the date of delivery at the address and in the manner
provided therein. Each Partner's address for notices and other communications
shall be that set forth in Section 1.5. A Limited Partner may change its
address for notices and communications by giving notice in writing, stating its
new address for notices, to the Chief Executive Officer. A General Partner may
change its address for notices by giving such written notice to the other
Partners.

Section 13.2. Amendments. This Agreement may be changed, modified, or
amended only by the affirmative vote or written consent of all of the Partners.

Section 13.3. Voting. Except as otherwise provided elsewhere herein,
all votes, approvals, consents or amendments required or taken under this
Agreement by the Partners shall be made or given in accordance with the
Partners' Post Threshold Ratios.

Section 13.4. Partition. Each of the Partners hereby irrevocably
waives for the term of the Partnership any right that such Partner may have to
maintain any action for partition with respect to the Partnership property.

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<PAGE> 73
Section 13.5. Entire Agreement. This Agreement and the Conveyances
constitute the full and complete agreement of the parties hereto with respect
to the subject matter hereof.

Section 13.6. No Waiver. The failure of any Partner to insist upon
strict performance of a covenant hereunder or of any obligation hereunder,
irrespective of the length of time for which such failure continues, shall not
be a waiver of such Partner's right to demand strict compliance in the future.
No consent or waiver, express or implied, to or of any breach or default in the
performance of any obligation hereunder shall constitute a consent or waiver to
or of any other breach or default in the performance of the same or any other
obligation hereunder.

SECTION 13.7. APPLICABLE LAW. EXCEPT TO THE EXTENT MANDATORILY
GOVERNED BY THE LAWS OF ANOTHER STATE, THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND INTERPRETED,
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.

Section 13.8. Successors and Assigns. Except as otherwise provided
herein, this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, devisees, personal representatives,
successors and assigns.

Section 13.9. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of which shall
constitute but one and the same instrument.

Section 13.10. Survival of Representations and Warranties. All
representations, warranties and covenants made by Partners in this Agreement or
any other document contemplated thereby or hereby shall be considered to have
been relied upon by the other parties hereto and shall survive the execution
and delivery of this Agreement or such other document, regardless of any
investigation made by or on behalf of any such party.

Section 13.11. Exhibits. The Exhibits to this Agreement are
incorporated herein by reference and made a part hereof for all purposes and
references to this Agreement shall also include such Exhibits unless the
context in which used shall otherwise require.

Section 13.12. No Third Party Beneficiaries. Except as otherwise
expressly provided herein, nothing in this Agreement is intended to confer on
any person other than the parties hereto and their respective successors or
permitted assigns, any rights, remedies, obligations or liabilities under or by
reason of this Agreement.

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<PAGE> 74
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

BRIGHAM EXPLORATION COMPANY

By: /s/ BEN M. BRIGHAM
-----------------------------
Ben M. Brigham, President

Agreement of Limited Partnership dated May 1, 1992, providing for the
formation of Brigham Oil & Gas, L.P..

<PAGE> 75

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

GENERAL ATLANTIC PARTNERS III, L.P.

By: GAP III Investors, Inc., its
General Partner

By:/s/ STEPHEN P. REYNOLDS
-----------------------------
Name: Stephen P. Reynolds
-----------------------
Title: President
----------------------

Agreement of Limited Partnership dated May 1, 1992, providing for the
formation of Brigham Oil & Gas, L.P..

<PAGE> 76
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

/s/ HAROLD D. CARTER
-----------------------------
Harold D. Carter

This Agreement is joined in by the spouse of Harold D. Carter for the
purpose of subjecting any community property interest she may have in the
interest of Harold D. Carter hereunder to the terms of this Agreement.

/s/ BETTY R. CARTER
-----------------------------

Agreement of Limited Partnership dated May 1, 1992, providing for the
formation of Brigham Oil & Gas, L.P..

<PAGE> 77

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

GAP-BRIGHAM PARTNERS, L.P.

By: /s/ STEPHEN P. REYNOLDS
-----------------------------
General Partner

Agreement of Limited Partnership dated May 1, 1992, providing for the
formation of Brigham Oil & Gas, L.P..

<PAGE> 78

This Agreement is executed and joined in by the undersigned for the
purpose of making the applicable covenants, representations and warranties
contained in Sections 9.2(b) and 12.3 hereof.

/s/ BEN M. BRIGHAM
-----------------------------
Ben M. Brigham

Agreement of Limited Partnership dated May 1, 1992, providing for the
formation of Brigham Oil & Gas, L.P.

<PAGE> 1
EXHIBIT 10.1.1

AMENDMENT NO. 1 TO AGREEMENT OF LIMITED PARTNERSHIP

BRIGHAM OIL & GAS, L.P.

THIS AMENDMENT NO. 1 TO AGREEMENT OF LIMITED PARTNERSHIP (herein
called this "Amendment") dated effective as of May 1, 1992, is made by and
among Brigham Exploration Company, a Texas corporation, General Atlantic
Partners III, L.P., a Delaware limited partnership, GAP-Brigham Partners, L.P.,
a Delaware limited partnership and Harold D. Carter, a Texas resident.

RECITALS:

WHEREAS, the parties have previously entered into that certain
Agreement of Limited Partnership dated as of May 1, 1992 (the "Partnership
Agreement"), establishing Brigham Oil & Gas, L.P. (the "Partnership"); and

WHEREAS, the parties desire to amend the Partnership Agreement to
clarify certain provisions relating to distributions to be made to the
Partners, such amendment to be effective as of May 1, 1992;

NOW, THEREFORE, in consideration of the foregoing Recitals and the
mutual covenants and agreements contained herein, the parties hereto do hereby
agree as follows:

1. Defined Terms.

(a) The defined term "Aggregate Tax Amount" contained in Section 2.1
of the Partnership Agreement is hereby deleted in its entirety.

(b) Any other capitalized terms used herein and not otherwise defined
shall have the respective meanings assigned to them in the Partnership
Agreement.

2. Distributions. Section 4.4 of the Partnership Agreement is
hereby amended in its entirety to read as follows:

Section 4.4. Distributions. All cash funds of the
Partnership shall be retained in the business of the Partnership and
shall be distributed to the Partners only at such time as the
Management Committee shall approve; provided, however, that
distributions shall be made to each Partner in an amount equal to such
Partner's Tax Amount, (as herein defined), such distributions to be
made not later than five days prior to the due date of the applicable
tax required to be paid by such Partner. A Partner's "Tax Amount" for
any taxable year shall be determined by the following formula:
<PAGE> 2
X = [(A + [B(1-A)])(C-D)] - E

Where X = The Tax Amount for such year;
A = the highest marginal federal income tax rate in
effect for such year (the "Federal Tax Rate");
B = the highest marginal Texas income tax rate (including
the franchise tax rate applicable to income) in
effect for such year;
C = such Partner's allocable share of the aggregate
taxable income or gain (including amounts realized in
excess of the adjusted tax basis in Depletable
Property sold by the Partnership) of the Partnership
for the current and all prior taxable years;
D = such Partner's allocable share of the aggregate
deductions and losses (including amounts realized
which are less than the adjusted tax basis of
Depletable Property sold by the Partnership)
recognized by the Partnership during the current and
all prior taxable years; and
E = the aggregate amount distributed to such Partner in
all prior taxable years on account of taxes under
this Section 4.4.

For purposes of this calculation, A and B shall both be the rates
applicable to corporations or individuals, whichever results in the
larger combined amount.

The Tax Amount for each Partner shall be determined annually (and
revised periodically, as necessary) by the Partnership's independent
accounting firm and reported to the Management Committee.
Distributions in excess of the Tax Amounts, if approved by the
Management Committee, shall be made in the following percentages and
amounts:

(a) If the distribution is made prior to the
attainment of Threshold Value:

(i) an amount shall first be distributed to
General Atlantic and GAP L.P. equal to their
respective Net Capital Contributions as computed
immediately prior to such distributions, and

(ii) the remaining amount to be distributed
shall be allocated among the Partners in proportion
to their respective Distribution Amounts. A
Partner's "Distribution Amount" on the date of any

2
<PAGE> 3
distribution shall be determined by the following
formula:

Y = (F + G)(H) - I

Where Y = such Partner's Distribution Amount;
F = the amount to be distributed by the
Partnership to all Partners pursuant to this
clause (ii);
G = the sum of (A) the aggregate amount
distributed or to be distributed by the
Partnership to all Partners on account of
taxes under this Section 4.4 for the current
and all prior taxable years and (B) the
aggregate amount previously distributed by
the Partnership to all Partners pursuant to
this clause (ii) for all prior taxable years;
H = such Partner's Post Threshold Ratio; and
I = the sum of (i) the aggregate amount
distributed or to be distributed by the
Partnership to such Partner on account of
taxes under this Section 4.4 for the current
and all prior taxable years and (ii) the
aggregate amount previously distributed by
the Partnership to such Partner pursuant to
this clause (ii) for all prior taxable years;

all as of the date of the distribution.

(b) If the distribution is made after the
attainment of Threshold Value, all distributions shall be
allocated to the Partners in proportion to their respective
Distribution Amounts; provided, however, that in computing the
Distribution Amounts of the Partners, items F, G and I in the
formula set forth in paragraph (a) of this Section 4.4 shall
mean the following:

F = the amount to be distributed by the
Partnership to all Partners pursuant to this
subparagraph (b);
G = the aggregate amount previously distributed
by the Partnership to all Partners pursuant
to this Section 4.4; and
I = the aggregate amount previously distributed
by the Partnership to such Partner pursuant
to this Section 4.4;

3
<PAGE> 4
Notwithstanding the foregoing, however, (i) any liquidating
distributions shall be made in accordance with Section 11.2, and (ii)
no distribution shall be made to any Partner if such distribution
would cause the Adjusted Capital Account balance of such Partner to be
less than zero.

The Partnership Agreement, as amended by this Amendment, is hereby
ratified and confirmed in all respects.

This Amendment may be executed in several counterparts, each of which
shall be an original and all of which shall constitute but one and the same
instrument.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment
the 14th day of September 1992, but effective as of May 1, 1992.

BRIGHAM EXPLORATION COMPANY

By: /s/ BEN M. BRIGHAM
-------------------------
Ben M. Brigham, President

GENERAL ATLANTIC PARTNERS, L.P.

By: GAP III Investors, Inc., its
General Partner

By: /s/ STEPHEN P. REYNOLDS
----------------------------
Name: Stephen P. Reynolds
-----------------------
Title: PRESIDENT
----------------------

GAP-BRIGHAM PARTNERS, L.P.

By /s/ STEPHEN P. REYNOLDS
---------------------------
General Partner

/s/ HAROLD D. CARTER
-------------------------------
Harold D. Carter

<PAGE> 1
EXHIBIT 10.1.2

AMENDMENT NO. 2 TO AGREEMENT OF LIMITED PARTNERSHIP

BRIGHAM OIL & GAS, L.P.

THIS AMENDMENT NO. 2 TO AGREEMENT OF LIMITED PARTNERSHIP (this
"Amendment"), dated September 20, 1994, is made by and among Brigham Exploration
Company, a Texas corporation, General Atlantic Partners III, L.P., a Delaware
limited partnership, GAP-Brigham Partners, L.P., a Delaware limited partnership,
Harold D. Carter, a Texas resident, and those additional persons (the "Employee
Partners") whose names appear on the signature page of this Amendment.

R E C I T A L S:

WHEREAS, the parties other than the Employee Partners have previously
entered into that certain Agreement of Limited Partnership dated as of May 1,
1992, which was amended by Amendment No. 1 to Agreement of Limited Partnership
dated as of May 1, 1992 (the "Partnership Agreement"), establishing Brigham Oil
& Gas, L.P. (the "Partnership);

WHEREAS, Section 3.8(b) of the Partnership Agreement permits the
Partnership to adopt plans for the benefit of employees of the Partnership,
including plans involving the issuance of partnership interests;

WHEREAS, the Partnership has established the Brigham Oil & Gas, L.P.
Employee Equity Interests Plan (the "Plan") and, pursuant thereto, has
designated the Employee Partners as participants thereunder; and

WHEREAS, each of the Employee Partners and the Partnership have entered
into Participation Agreements of even date herewith (the "Participation
Agreements");

NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, the parties hereto do hereby agree
as follows:

1. Defined Terms. Any capitalized terms used herein and not otherwise
defined shall have the respective meanings assigned to them in the Partnership
Agreement.

2. Admission of Employee Partners. Each of the Employee Partners is
hereby admitted as a Limited Partner in the Partnership pursuant to Section 3.8
of the Partnership Agreement.

3. Post Threshold Ratios. The Post Threshold Ratios of the Partners
shall be adjusted to reflect the admission of the Employee Partners as provided
in the definition of such term and in the Participation Agreements.
<PAGE> 2
4. Initial Capital of Employee Partners. The Employee Partners shall
not be required to make any Capital Contributions to the Partnership and shall
have an initial Capital Account balance of zero as of the date hereof.

5. Reports. The Employee Partners shall be entitled to receive those
reports as are described in Section 8.2 of the Partnership Agreement and such
other information as may be reasonably requested by the Employee Partners from
time to time provided the disclosure of such information is in the best
interests of the Partnership as determined by the Managing General Partner in
its sole and absolute discretion.

6. Rights of Employee Partners. Except as otherwise required by the
Act, and notwithstanding any provision of the Partnership Agreement to the
contrary, the rights of the Employee Partners shall be only those rights
specifically granted to them in the Participation Agreements and in this
Amendment. In the event of any conflict between the rights granted to Limited
Partners under the Partnership Agreement and the rights granted to Employee
Partners under the Participation Agreements or this Amendment, the
Participation Agreements and this Amendment shall control. In the event of any
conflict between the rights granted to the Employee Partners under the
Participation Agreements and the rights granted to them under this Amendment,
the Participation Agreements shall control.

7. Rights to Acquire Additional Interests. Notwithstanding any
provision of the Partnership Agreement to the contrary, the Employee Partners
shall not have any right to acquire additional interests in the Partnership.
The Employee Partners shall have no right to acquire additional securities
under Section 3.7 of the Partnership Agreement and any purchase of an interest
by the Partnership under Article IX of the Partnership Agreement shall affect
only the interests of those Partners other than the Employee Partners.

8. Ratification. The Partnership Agreement, as amended by this
Amendment and as modified with respect to the Employee Partners by the
Participation Agreements, is hereby ratified and confirmed in all respects.

9. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute one and the same instrument.

-2-
<PAGE> 3
IN WITNESS WHEREOF, the parties hereto have executed this Amendment this
30th day of September, 1994, but effective as of the date first above written.

BRIGHAM EXPLORATION COMPANY

By: /s/ BEN M. BRIGHAM
--------------------------------
Ben M. Brigham, President

GENERAL ATLANTIC PARTNERS, L.P.

By: GAP III Investors, Inc., its
General Partner

By: /s/ STEPHEN P. REYNOLDS
--------------------------
Name: Stephen P. Reynolds
---------------------
Title: President
--------------------

GAP-BRIGHAM PARTNERS, L.P.

By: /s/ STEPHEN P. REYNOLDS
---------------------------------
General Partner

/s/ HAROLD D. CARTER
-------------------------------------
Harold D. Carter

EMPLOYEE PARTNERS:

Jon L. Glass
David T. Brigham
Craig M. Fleming

By: Brigham Exploration Company,
Managing General Partner and
Attorney-in-Fact

By: /s/ BEN M. BRIGHAM
---------------------------
Ben M. Brigham, President

-3-

<PAGE> 1
EXHIBIT 10.1.3

AMENDMENT NO. 3 TO AGREEMENT OF LIMITED PARTNERSHIP

BRIGHAM OIL & GAS, L.P.

THIS AMENDMENT NO. 3 TO AGREEMENT OF LIMITED PARTNERSHIP (herein
called this "Amendment") dated as of August 24, 1995, is made by and among
Brigham Exploration Company, a Texas corporation, General Atlantic Partners
III, L.P., a Delaware limited partnership, GAP-Brigham Partners, L.P., a
Delaware limited partnership, Harold D. Carter, Craig M. Fleming, David T.
Brigham and Jon L. Glass.

RECITALS:

WHEREAS, the parties have previously entered into that certain
Agreement of Limited Partnership dated as of May 1, 1992, establishing Brigham
Oil & Gas, L.P. (the "Partnership"), as amended by Amendment No. 1 to Agreement
of Limited Partnership dated as of May 1, 1992, and Amendment No. 2 to
Agreement of Limited Partnership dated as of September 30, 1994 (collectively,
the "Partnership Agreement"); and

WHEREAS, the parties desire to amend the Partnership Agreement for the
purposes set forth below;

NOW, THEREFORE, in consideration of the foregoing Recitals and the
mutual covenants and agreements contained herein, the parties hereto do hereby
agree as follows:

1. Defined Terms.

(a) The defined term "Post Threshold Ratios" contained in Section
2.1 is hereby amended in its entirety to read as follows:

"Post Threshold Ratios" shall mean the following percentages:
38.18% to General Atlantic, 1.82% to GAP L.P., 55% to BEC and 5% to
Carter, which percentages shall be adjusted (including without
limitation, for the purposes of Sections 6.1(d) and 9.2) on a
proportionate basis to reflect the issuance of (a) limited partnership
interests in the Partnership (only with respect to allocations of
income, expense and distributions after the achievement of Threshold
Value and subject to forfeiture in certain circumstances) to Craig M.
Fleming, David T. Brigham and Jon L. Glass prior to August 1, 1995,
and (b) any additional Equity Securities after such date. The Post
Threshold Ratios shall be effective as provided in Article IV and
elsewhere herein regardless of whether or not the Threshold Value is
reached. (Also see Section 4(ii) of Amendment No. 3 to Agreement of
Limited Partnership.)

(b) Section 2.1 is hereby amended to add the following additional
defined terms:

"Conversion" shall mean conversion of the entire outstanding
principal balance of and all accrued Deferred Interest (as such term
is defined in the RIMCO Note) on the RIMCO Note into a limited
partnership interest of the Partnership or other Equity
<PAGE> 2
Securities upon the election of RIMCO as provided for in Section 4
below and in the RIMCO Note.

"RIMCO" shall mean RIMCO Partners, L.P. II, a Delaware limited
partnership, RIMCO Partners, L.P. III, a Delaware limited partnership,
and RIMCO Partners, L.P. IV, a Delaware limited partnership, and any
person who becomes an owner or holder of any portion of the RIMCO Note
in accordance with the terms thereof or, if Conversion has occurred,
any person who has become a limited partner or substituted limited
partner of the Partnership pursuant to the terms hereof with respect
to any interest in the Partnership that was issued as a consequence of
Conversion. The consent, election, vote, determination, approval or
other action required or otherwise provided for under this Agreement
with respect to Conversion or to the appointment, removal and other
matters relating to the RIMCO Representative and in all other
provisions of this Agreement where the defined term "RIMCO" is used
shall refer to and require the joint or concurrent consent, election,
vote, determination, approval or such other action by all of the then
current owners and holders of the RIMCO Note or, if Conversion has
occurred, the then current Limited Partners owning or holding the
interest in the Partnership that was issued as a consequence of
Conversion.

"RIMCO Note" shall mean the 5% Convertible Subordinated Notes
to be issued by the Partnership to RIMCO pursuant to a Note Purchase
Agreement to be made by the Partnership and RIMCO. Unless the context
otherwise requires, the term "RIMCO Note" shall also mean and include
the Note Purchase Agreement pursuant to which such 5% Convertible
Subordinated Notes are issued and all other documents executed by the
Partnership in connection therewith.

"RIMCO Permitted Transferees" shall have the meaning set forth
in Section 6.1(l).

"RIMCO Representative" shall have the meaning set forth in
Section 6.1(l).

(c) Any other capitalized terms used herein and not otherwise
defined shall have the respective meanings assigned to them in the Partnership
Agreement.

(d) All references in this Amendment to sections refer to sections
of the Partnership Agreement unless expressly provided otherwise. Titles
appearing at the beginning of sections of this Amendment are for convenience
only and shall not constitute part of such subdivisions and shall be
disregarded in construing the language contained in such sections. Words in
the singular form shall be construed to include the plural and vice versa
unless the context otherwise requires.

2. Preemptive Rights. Each Partner hereby waives all rights that
such Partner may have pursuant to Section 3.7 or otherwise to purchase or
otherwise acquire any portion of the RIMCO Note or any interest in the
Partnership to be issued upon Conversion of the RIMCO Note.

3. Authorizations. For purposes of Section 6.2(a), (d) and (k),
the Management Committee has approved and authorized the execution, delivery
and issuance of the RIMCO Note, the issuance of the 20% limited partnership
interest in the Partnership upon Conversion as provided in Section 4 below and
the execution and delivery of this Amendment (in this Section

-2-
<PAGE> 3
3, the "Authorized Matters"). For such purposes and on behalf of the
Management Committee and a GAP Representative and of the Partnership, the
parties hereto approve, authorize and ratify the Authorized Matters and the
execution and delivery of the RIMCO Note in the form submitted to the parties
with such changes therein as the Managing General Partner shall approve (except
with respect to the following fundamental features: the amount of the RIMCO
Note, the interest rate provided for therein, the maturity date thereof and the
20% conversion ratio provided for herein and therein); and no further
authorization or approval of the Management Committee or any Representative
shall be required with respect to the Authorized Matters (except with respect
to such fundamental features).

4. Issuance of RIMCO Partnership Interest. Upon the election of
RIMCO and satisfaction of the conditions set forth in the RIMCO Note and this
Amendment, RIMCO shall be permitted to convert the entire outstanding principal
balance of and all accrued Deferred Interest on the RIMCO Note into a 20%
limited partnership interest in the Partnership and become a Limited Partner of
the Partnership, which conversion shall be treated as a contribution of
property to the Partnership; provided that any such election to convert by
RIMCO can only be exercised in whole and with respect to all of the outstanding
principal balance of and accrued Deferred Interest on the RIMCO Note and not in
part or with respect to only a portion of such principal amount or Deferred
Interest; and provided further, that such 20% limited partnership interest
shall be subject to (a) the issuance prior to August 1, 1995, of limited
partnership interests in the Partnership (only with respect to allocations of
income, expense and distributions after the achievement of Threshold Value and
subject to forfeiture in certain circumstances) to Craig M. Fleming, David T.
Brigham, and Jon L. Glass and (b) the issuance after such date (whether before
or after Conversion) of additional Equity Securities or options therefor to
management personnel under any established option plan of the Partnership
(which plan was approved as a Major Decision) in an amount (including those
referred to in subsection (a) immediately above) not exceeding 10% of the
Partnership's total outstanding equity. Accordingly, the 20% limited
partnership interest to be issued to RIMCO upon Conversion shall be reduced
proportionately upon its issuance to adjust for the Equity Securities issued as
discussed in subsection (a) immediately above and upon the later of its
issuance or the issuance of any additional Equity Securities as discussed in
subsection (b) immediately above to adjust for such additional Equity
Securities. Subject to such adjustments and upon Conversion:

(i) Prior to the achievement of Threshold Value, RIMCO shall have
allocated to it 20% of the amounts provided for in Sections 4.1(a), the last
sentence of Section 4.2(a), Section 4.2(b)(i), and Section 4.3(d), and the
amounts allocated to the other Partners in such Sections shall be reduced
proportionately;

(ii) RIMCO shall have a Post Threshold Ratio of 20%, and the Post
Threshold Ratios of the other Partners (except those Partners named in, and/or
who acquire Equity Securities under the circumstances described in, subsection
(a) or (b) above in this Section 4) shall be reduced proportionately;

(iii) With respect to distributions of Tax Amounts pursuant to
Section 4.4, RIMCO shall receive a Tax Amount for each taxable year or portion
thereof after Conversion;

(iv) With respect to distributions in excess of Tax Amounts
pursuant to Section 4.4, RIMCO shall receive:

-3-
<PAGE> 4
(A) 20% of each amount distributed pursuant to Section
4.4(a)(i), and the amounts distributed to General Atlantic and GAP
L.P. shall be reduced proportionately, and

(B) its Distribution Amount of each amount distributed
pursuant to Sections 4.4(a)(ii) and 4.4(b);

(v) The 20% percentage (before any adjustment) provided for above
in this Section 4 shall be:

(A) further adjusted on a proportionate basis to reflect any
issuance or redemption of any Equity Securities (without duplication
of any adjustments provided for above in this Section 4), and

(B) converted into the equivalent amount (after all such
adjustments) of capital stock or other Equity Securities in the event
of a conversion of the Partnership to a corporation or other entity;
and

(vi) The Capital Accounts of the Partners shall be adjusted as of
the date of Conversion to equal their respective fair market values by
increasing or decreasing such Capital Accounts to reflect the manner in which
any unrealized income, gain, loss or deduction in Partnership property would be
allocated among the Partners if there were a taxable disposition of such
property for its fair market value on the date of Conversion, all as required
under Treasury Regulation Section 1.704-1(b)(2)(iv)(f). Thereafter, the
Capital Accounts shall be adjusted in accordance with Treasury Regulation
Section 1.704-1(b)(2)(iv)(g) for items of depreciation, Simulated Depletion,
amortization and gain or loss (including Simulated Gain and Simulated Loss)
with respect to such property computed in the same manner as such items would
be computed if the adjusted tax basis of such property had been equal to its
fair market value on the date of Conversion, in lieu of the adjustments to the
Capital Accounts otherwise provided in Section 8.1(b). The Partners' shares of
any depreciation, depletion, amortization and gains or losses with respect to
such property, as computed for tax purposes, shall be allocated in a manner
that takes into account any variation between the value of such property as
reflected in the Capital Accounts, after making such adjustments, and the tax
basis of such property, in the same manner as required under Section 704(c) of
the Internal Revenue Code with respect to contributed property.

Upon Conversion, RIMCO shall be admitted to the Partnership as a Limited
Partner if and only if:

(I) RIMCO is able to and does make all the representations and
warranties contained in Sections 12.1 and 12.2, including without limitation
that it is eligible to acquire and hold Federal oil and gas leases in
compliance with all applicable laws;

(II) Upon such admission, neither of the General Partners shall be
considered a "fiduciary" for RIMCO or any person directly or indirectly owning,
controlling or holding with power to vote any equity securities in RIMCO for
purposes of the Employee Retirement Income Security Act of 1974, as amended;
and

-4-
<PAGE> 5
(III) RIMCO executes and delivers such instruments, in form and
substance reasonably satisfactory to the Managing General Partner, as the
Managing General Partner may deem necessary or desirable to effect such
admission and to confirm the agreement of RIMCO to be bound by all of the terms
and provisions of the Partnership Agreement.

5. Management Committee.

(a) Section 6.1(c) is hereby amended by deleting the last sentence
of Section 6.1(c).

(b) Section 6.1 is hereby amended by adding Section 6.1(l) which
shall read in its entirety as follows:

(l) Upon the issuance by the Partnership of the RIMCO
Note, the Management Committee shall be automatically expanded to
seven Representatives, four of whom shall be appointed by BEC and
shall be Brigham Representatives, two of whom shall be appointed by
General Atlantic and shall be GAP Representatives and one of whom
shall be appointed by RIMCO and shall be called the "RIMCO
Representative". The additional Brigham Representative initially
shall be Jon L. Glass, and the RIMCO Representative initially shall be
Gary J. Milavec. With respect to the first sentence of Section
6.1(c), the RIMCO Representative shall serve at the pleasure of RIMCO
and may be removed, with or without cause, by RIMCO upon written
notice thereof given by RIMCO to the General Partners and to the other
Representatives. Except as expressly provided in this Section 6.1(l),
the other provisions of Section 6.1 and elsewhere in this Agreement
shall be applicable to this Section 6.1(l) and the RIMCO
Representative; and (except as aforesaid) the other provisions of
Section 6.1 (and the defined terms created therein) and the other
provisions of this Agreement shall be modified and subject to this
Section 6.1(l). Without modification of the approvals required in
Section 6.2, all RIMCO Decisions (as hereinafter defined) with respect
to the Partnership business shall require the favorable vote of the
RIMCO Representative after the issuance of the RIMCO Note and except
as otherwise provided below in this Section 6.1. Accordingly,
notwithstanding anything in this Agreement to the contrary (but only
after the issuance of the RIMCO Note and except as otherwise provided
below in this Section 6.1), neither General Partner nor the Chief
Executive Officer shall have the right or the power to make any
commitment or engage in any undertaking on behalf of the Partnership
in respect of a RIMCO Decision unless and until the RIMCO
Representative has authorized the same. The term "RIMCO Decision" as
used in this Section 6.1(l) means any decision with respect to the
following matters:

(a) The sale of the Partnership; or the sale, lease,
transfer or disposition of all or substantially all of the assets of
the Partnership;

(b) The issuance of any additional Partnership interests
or any other form of Equity Securities in the Partnership; provided,
however, that the issuance of equity interests or options therefor to
management personnel under any established option plan of the
Partnership (which plan was approved as a Major Decision) in an amount
not exceeding 10% of the Partnership's total outstanding equity shall
not be deemed to be a RIMCO Decision requiring approval of the RIMCO
Representative;

-5-
<PAGE> 6
(c) Any decision to merge or consolidate the
Partnership's business or to acquire all or substantially all of the
assets of another company where such acquisition requires the payment
of consideration by the Partnership valued at 33% or more of the then
value of the Partnership (in each case determined by a majority vote
of the members of the Management Committee); and

(d) Any decision of the Partnership to file a voluntary
petition seeking liquidation, reorganization, arrangement or
readjustment, in any form, of the Partnership's debts under Title 11
of the United States Code (or corresponding provisions of future laws)
or any other federal or state insolvency law, or to file an answer
consenting to or acquiescing in any such petition, or the making by
the Partnership of any general assignment for the benefit of its
creditors or the admission in writing of its inability to pay its
debts as they mature.

After the expiration of seven years, commencing with the Effective
Date, if the Threshold Value has been achieved, Conversion has
occurred and BEC shall own at least 50% of its original Post Threshold
Ratio Interest in the Partnership (after adjustment upon any
Conversion), the actions set forth in subsection (a) (but only with
respect to the sale of all or substantially all of the assets of the
Partnership for cash and/or equity securities of a company with a
market value in excess of one hundred million dollars listed on a
national securities exchange) and subsections (b) and (c) with respect
to any public offering of equity securities, shall no longer be deemed
to be RIMCO Decisions requiring approval of the RIMCO Representative
pursuant to this Section 6.1(l) and are actions that may be taken by
BEC without the consent of any other Partners or the Management
Committee. Upon the occurrence of either of the following events,
this Section 6.1(l) shall automatically become null and void and have
no further force and effect, RIMCO shall no longer have a RIMCO
Representative, the Brigham Representatives shall be reduced from four
to three (with BEC to designate the person who shall cease to continue
as a Brigham Representative) and the Management Committee shall be
reduced to five members (plus any additional members appointed
pursuant to Section 6.1(e)):

(i) The RIMCO Note is repaid in full and Conversion does
not occur; or

(ii) If Conversion shall occur and RIMCO shall transfer in
one or more transactions an aggregate in excess of 5% of its Post
Threshold Ratio interest to a transferee or transferees (other than to
a RIMCO Permitted Transferee) such that, as a result of such transfer
or transfers, RIMCO's Post Threshold Ratio is less than 15%. For
purposes of this Section 6.1(l), "RIMCO Permitted Transferees" shall
mean any person that is (a) controlling, controlled by or under common
control with any of RIMCO Partners, L.P. II, RIMCO Partners, L.P. III,
or RIMCO Partners, L.P. IV, or (b) a liquidating trust formed upon
dissolution of any such limited partnership; provided, that any RIMCO
Permitted Transferee irrevocably appoints RIMCO (or Resource Investors
Management Company if RIMCO is not at any future date in existence)
the attorney and proxy of such RIMCO Permitted Transferee with full
power of substitution to vote the interest in the Partnership so
transferred as RIMCO (or Resource Investors Management Company) may
determine in its sole discretion; and provided further, that in no
event shall the term "RIMCO Permitted Transferee" include any person
principally engaged in the oil and gas business through the direct
ownership of working interests.

-6-
<PAGE> 7
6. Major Decisions Requiring Management Committee Approval.

(a) The first two original sentences of Section 6.2 are hereby
amended in their entirety to read as follows:

All Major Decisions (as hereinafter defined) with respect to the
Partnership business shall require the approval of a majority vote of
the members of the Management Committee, which majority shall include
at least one GAP Representative (except as provided below) and Ben M.
Brigham so long as he shall serve as a Brigham Representative. If Ben
M. Brigham shall cease to serve as a Brigham Representative for any
reason, all Major Decisions shall require the approval of such other
Brigham Representative as from time to time shall be designated by
BEC. Accordingly, notwithstanding anything in this Agreement to the
contrary, neither General Partner nor the Chief Executive Officer
shall have the right or the power to make any commitment or engage in
any undertaking on behalf of the Partnership in respect of a Major
Decision unless and until the Management Committee (and both (i) a GAP
Representative (except as provided below) and (ii) Ben M. Brigham or
his successor so designated by BEC) have authorized the same.

(b) Section 6.2(a) is hereby amended in its entirety to read as
follows:

(a) The issuance of any form of long-term debt in excess
of $1,600,000, as such amount may be adjusted on an annual basis by
the Management Committee (including at least one GAP Representative
voting in favor of such adjustment) to reflect changes in the
Partnership's financial position; provided, however, that the majority
vote or approval of the members of the Management Committee shall not
require the inclusion, vote or approval of a GAP Representative unless
such long-term debt is in excess of $3,200,000;

(b) Decisions with respect to the compensation (including
cash, equity, benefits and other compensation features) of Brigham
family members who are key functional personnel at the vice
presidential (or equivalent) level or above and the implementation of
any employee benefit plan in which such key functional personnel are
eligible to participate;

(d) Section 6.2(c) is hereby amended in its entirety to read as
follows:

(c) The sale of the Partnership; the sale, lease,
transfer or disposition of all or substantially all of the assets of
the Partnership; or the sale, or disposition of assets (i) other than
in the ordinary course of business and (ii) in excess of a $500,000
selling price (or value in the event of a transfer or lease for other
than cash); provided, however, that the majority vote or approval of
the members of the Management Committee shall not require the
inclusion, vote or approval of a GAP Representative with respect to
any such sale or disposition of assets unless the selling price (or
value when applicable) is in excess of $1,000,000;

(e) Section 6.2(f) is hereby amended in its entirety to read as
follows:

-7-
<PAGE> 8
(f) The expenditure or commitment of Partnership funds in
excess of $800,000 with respect to amounts not previously included in
an annual operating or capital budget, which threshold amount
(originally $500,000) shall be increased annually by the Management
Committee to reflect changes in the Partnership's financial position;
provided, however, that the majority vote or approval of the members
of the Management Committee shall not require the inclusion, vote or
approval of a GAP Representative with respect to any such expenditure
or commitment of Partnership funds unless such expenditure or
commitment is in excess of $1,600,000;

7. Power and Authority of the Chief Executive Officer and
Managing General Partner.

(a) The first three original sentences of Section 6.4(a) are
hereby amended in their entirety to read as follows:

(a) Ben M. Brigham shall act as Chief Executive officer
of the Partnership pursuant to the Employment Agreement and shall have
the power and authority, acting through BEC which shall be the
Managing General Partner, to conduct the day to day business and
operations of the Partnership. The Chief Executive Officer will
report to the Management Committee. The Managing General Partner,
upon the authorization or approval of the Management Committee and any
necessary Representatives or the Chief Executive Officer (acting as
such and not in any individual capacity), shall be authorized to
execute documents, instruments and other agreements on behalf of the
Partnership. Upon the request of the Chief Executive Officer, the
Managing General Partner shall be authorized to ratify and confirm all
actions of the Chief Executive Officer.

(b) References in Section 6.4(a) and 6.13(c) and elsewhere in the
Partnership Agreement to the "Managing General Partner (if acting at the
request of the Chief Executive Officer)" or of similar import shall be deemed
to refer to the Chief Executive Officer acting through the Managing General
Partner.

8. Confidentiality. Notwithstanding anything to the contrary in
Section 6.14, any of RIMCO Partners, L.P. II, RIMCO Partners, L.P. III or RIMCO
Partners, L.P. IV may disclose the financial statements and reports furnished
to such limited partnerships (a) pursuant to Section 8.2 (a), (b), (c) and (d),
to the limited partners of such limited partnerships and (b) pursuant to
Section 8.2(e) or otherwise, to those limited partners of such limited
partnerships that (i) have executed a confidentiality agreement in form and
substance reasonably satisfactory to the Managing General Partner and (ii) are
either institutional investors or investors who are not engaged in any material
respect in the oil and gas business.

9. Reports. Section 8.2 is hereby amended in its entirety to
read as follows:

Section 8.2. Reports. The Chief Executive Officer shall
deliver to BEC, Carter, General Atlantic, GAP L.P. and (if Conversion
has occurred) RIMCO (and to such other Partners as the Chief Executive
Officer shall determine appropriate) the following financial
statements and reports at the times indicated below:

-8-
<PAGE> 9
(a) Annual Statements -- within 120 days after the end of
each fiscal year of the Partnership, audited financial statements of
the Partnership for such fiscal year, which audited financial
statements shall be prepared in accordance with generally accepted
accounting principles and shall set forth, as of the end of and for
such fiscal year, a profit and loss statement and a balance sheet of
the Partnership, and such other information as, in the judgment of the
Chief Executive Officer of the Partnership, shall be reasonably
necessary for the Partners to be advised of the financial status and
results of operations of the Partnership.

(b) Quarterly Statements -- within 45 days after the end
of the first, second and third fiscal quarters of the Partnership in
each of its fiscal years, unaudited financial statements of the
Partnership for the portion of the fiscal year then ending, which
financial statements shall be prepared in accordance with generally
accepted accounting principles and shall set forth, as of the end of
and for such portion of the fiscal year, a profit and loss statement
and a balance sheet of the Partnership, and such other information as,
in the judgment of the Chief Executive Officer of the Partnership,
shall be reasonably necessary for the Partners to be advised of the
financial status and results of operations of the Partnership.

(c) Annual Tax Information -- by March 31 of each year or
as soon thereafter as is reasonably possible, a report containing such
information as may be reasonable to enable each Partner to prepare and
file his federal income tax return and any required state income tax
return.

(d) Annual Engineering Report -- within 120 days after
the end of each fiscal year of the Partnership, a reserve engineering
report of the Partnership as of the end of such fiscal year, setting
forth the estimated oil and gas reserves of the Partnership at such
time and containing a calculation of the future net revenue from the
production of such reserves and of the discounted present value
thereof. Such reserve report shall be prepared by (or audited by) an
independent firm of petroleum reserve engineers if (and only if) the
Partnership has obtained such a report for its other purposes.

(e) Requested Information -- such other reports and
information as the Chief Executive Officer of the Partnership shall
determine or as General Atlantic or RIMCO shall reasonably request
from time to time.

10. Substitution of Transferee. For purposes of Section
9.1(c)(ii), the Managing General Partner hereby consents to the admission to
the Partnership as a Limited Partner or a substituted Limited Partner of a
corporation, all of whose outstanding capital stock is owned by RIMCO Partners,
L.P. II, RIMCO Partners, L.P. III, RIMCO Partners, L.P. IV and/or any future
limited partnership that is managed by Resource Investors Management Company
and whose purpose and investor profile is similar to such existing RIMCO
limited partnerships.

11. Co-Sale Rights. RIMCO shall have the same rights set forth in
Section 9.8 as General Atlantic and GAP L.P. The Management Partners shall
have the same rights set forth in Section 9.8 with respect to sales of Equity
Securities by RIMCO, or any person included in such definition (other than
transfers to RIMCO Permitted Transferees), as the Management Partners have with
respect to sales of Equity Securities by either of the GA Partners.

-9-
<PAGE> 10
12. Registration Rights. RIMCO shall have the same rights set
forth in Section 10.2 as General Atlantic; subject, however, to (a) the
limitations of Section 10.3 and the other provisions of Article X and (b) the
further limitation that RIMCO may only request one registration under Section
10.2 for a registration of a Transfer of Equity Securities (rather than two as
is permitted by Section 10.3(b) for General Atlantic).

13. BEC Address. The address of BEC in Section 1.5 shall be 5949
Sherry Lane, Suite 1616, Dallas, Texas 75225, fax number: (214) 360-9825.

14. Ratification. The Partnership Agreement, as amended by this
Amendment, is hereby ratified and confirmed in all respects.

15. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be deemed an original and all of which shall
constitute but one and the same instrument.

16. Effective Date. This Amendment shall be effective as of the
date first shown above.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first shown above.

BRIGHAM EXPLORATION COMPANY

By: /s/ ANNE L. BRIGHAM
-----------------------------------------
Anne L. Brigham, Executive Vice President

GENERAL ATLANTIC PARTNERS, L.P.

By: GAP III Investors, Inc., its
General Partner

By: /s/ WILLIAM E. FORD
-----------------------------------------
William E. Ford, Vice President

GAP-BRIGHAM PARTNERS, L.P.

By: /s/ WILLIAM E. FORD
-----------------------------------------
William E. Ford, General Partner

-10-
<PAGE> 11
/s/ HAROLD D. CARTER
--------------------------------------------
HAROLD D. CARTER

CRAIG M. FLEMING
DAVID T. BRIGHAM
JON L. GLASS

By: Brigham Exploration Company,
the Attorney-in-Fact for
such Limited Partners

By:/s/ ANNE L. BRIGHAM
-----------------------------------------
Anne L. Brigham, Executive Vice President

-11-

<PAGE> 1
EXHIBIT 10.2

__________________________________

AGREEMENT OF LIMITED PARTNERSHIP

Venture Acquisitions, L.P.

September 23, 1994

__________________________________
<PAGE> 2
AGREEMENT OF Limited Partnership

Venture Acquisitions, L.P.

Table of Contents

<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I Formation of Partnership . . . . . . . . . . . . . . 1
Section 1.1. Formation . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Name . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.3. Business . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.4. Places of Business . . . . . . . . . . . . . . . . . 2
Section 1.5. Names and Addresses of Partners . . . . . . . . . . . 2
Section 1.6. Term . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.7. Filings . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.8. Title to Partnership Property . . . . . . . . . . . . 3

ARTICLE II Certain Definitions and References . . . . . . . . . 3
Section 2.1. Certain Defined Terms . . . . . . . . . . . . . . . . 3
Section 2.2. References and Title . . . . . . . . . . . . . . . . 8

ARTICLE III Capitalization . . . . . . . . . . . . . . . . . . . 9
Section 3.1. Capital Contributions of General Partners . . . . . . 9
Section 3.2. Capital Contributions of Limited Partners . . . . . . 9
Section 3.3. Requests and Payments of Capital Contributions . . . 9
Section 3.4. Reduced Capital Contributions of Partners . . . . . . 10
Section 3.5. Request for Additional Capital Contributions
of Partners . . . . . . . . . . . . . . . . . . . . . 10
Section 3.6. Non-Payment of Capital Contributions . . . . . . . . 11
Section 3.7. Return of Capital Contributions . . . . . . . . . . . 11
Section 3.8. Payments and Advances by General Partners . . . . . . 12

ARTICLE IV Allocations and Distributions . . . . . . . . . . . . 12
Section 4.1. Allocation of Costs and Expenses . . . . . . . . . . 12
Section 4.2. Allocation of Revenues . . . . . . . . . . . . . . . 13
Section 4.3. Income Tax Allocations . . . . . . . . . . . . . . . 14
Section 4.4. Distributions . . . . . . . . . . . . . . . . . . . . 17

ARTICLE V Partnership Properties . . . . . . . . . . . . . . . 17
Section 5.1. Lease Acquisitions . . . . . . . . . . . . . . . . . 17
Section 5.2. Lease Sales . . . . . . . . . . . . . . . . . . . . . 18
Section 5.3 BOG Activities and Area of Mutual Interest . . . . . 18
Section 5.4 Exclusive Dealings . . . . . . . . . . . . . . . . . 18
Section 5.5 Insurance . . . . . . . . . . . . . . . . . . . . . . 18

ARTICLE VI Management . . . . . . . . . . . . . . . . . . . . . . 19
Section 6.1. Power and Authority of Managing General Partner . . . 19
</TABLE>

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<PAGE> 3
<TABLE>
<S> <C>
Section 6.2. Management Decisions of the General Partners . . . . 19
Section 6.3. Duties and Services of General Partners . . . . . . . 21
Section 6.4. Liability of General Partners . . . . . . . . . . . . 21
Section 6.5. Limitations on Indemnification . . . . . . . . . . . 22
Section 6.6. Costs, Expenses and Reimbursement . . . . . . . . . . 22
Section 6.7 Contracts With Affiliates . . . . . . . . . . . . . . 23
Section 6.8. Tax Elections . . . . . . . . . . . . . . . . . . . . 23
Section 6.9. Tax Returns . . . . . . . . . . . . . . . . . . . . . 24
Section 6.10. Outside Activities and Resolution of
Conflicts of Interest . . . . . . . . . . . . . . . . 24
Section 6.11. Other Matters Concerning a General Partner . . . . . 26

ARTICLE VII Rights and Obligations of Limited Partners . . . . . . 26
Section 7.1. Rights of Limited Partners . . . . . . . . . . . . . 26
Section 7.2. Limitations on Limited Partners . . . . . . . . . . . 26
Section 7.3. Liability of Limited Partners . . . . . . . . . . . . 27
Section 7.4. Withdrawal and Return of Capital Contribution . . . . 27
Section 7.5. Power of Attorney . . . . . . . . . . . . . . . . . . 27

ARTICLE VIII Books, Records, Reports and Bank Accounts . . . . . . 28
Section 8.1. Capital Accounts, Books and Records . . . . . . . . . 28
Section 8.2 Reports . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.3. Information Relating to the Partnership . . . . . . . 31

ARTICLE IX Assignments of Interests and Substitutions . . . . . . 31
Section 9.1. Assignments by Limited Partners . . . . . . . . . . . 31
Section 9.2. Assignment by General Partners . . . . . . . . . . . 32
Section 9.3. Merger or Consolidation . . . . . . . . . . . . . . . 33
Section 9.4. Withdrawal of Managing General Partner's Interest
in Partnership Properties . . . . . . . . . . . . . . 33
Section 9.5. Withdrawal of RIMCO's Interest in Partnership
Properties . . . . . . . . . . . . . . . . . . . . . 34
Section 9.6. Purchase of Certain Leases . . . . . . . . . . . . . 35

ARTICLE X Dissolution, Liquidation and Termination . . . . . . 35
Section 10.1. Dissolution . . . . . . . . . . . . . . . . . . . . . 35
Section 10.2. Withdrawal by General Partners and Reconstitution . . 36
Section 10.3. Liquidation and Termination . . . . . . . . . . . . . 36
Section 10.4. Cancellation of Certificate . . . . . . . . . . . . . 37

ARTICLE XI Representations and Warranties . . . . . . . . . . . . 38
Section 11.1. Representations and Warranties of Partners . . . . . 38
Section 11.2. Additional Representations and Warranties
of Limited Partners . . . . . . . . . . . . . . . . . 38
Section 11.3. Survival of Representations and Warranties . . . . . 39

ARTICLE XII Miscellaneous . . . . . . . . . . . . . . . . . . . . 39
Section 12.1. Notices . . . . . . . . . . . . . . . . . . . . . . . 39
Section 12.2. Amendments . . . . . . . . . . . . . . . . . . . . . 39
Section 12.3. Partition . . . . . . . . . . . . . . . . . . . . . . 39
</TABLE>

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<PAGE> 4
<TABLE>
<S> <C>
Section 12.4. Entire Agreement . . . . . . . . . . . . . . . . . . 39
Section 12.5. No Waiver . . . . . . . . . . . . . . . . . . . . . . 39
Section 12.6. Applicable Law and Venue . . . . . . . . . . . . . . 39
Section 12.7. Successors and Assigns . . . . . . . . . . . . . . . 40
Section 12.8. Severability . . . . . . . . . . . . . . . . . . . . 40
Section 12.9. Jury Trial Waived . . . . . . . . . . . . . . . . . . 40
Section 12.10. Counterparts . . . . . . . . . . . . . . . . . . . . 40
Section 12.11. No Third Party Beneficiaries . . . . . . . . . . . . 40
</TABLE>

-iii-
<PAGE> 5
THE LIMITED PARTNERSHIP INTERESTS IN VENTURE ACQUISITIONS, L.P. HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND
MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF UNLESS
SUCH INTERESTS ARE FIRST REGISTERED PURSUANT TO ALL SUCH APPLICABLE LAWS OR
UNLESS AN EXEMPTION FROM REGISTRATION UNDER SUCH ACTS IS AVAILABLE. THE SALE,
ASSIGNMENT OR OTHER TRANSFER OF SUCH INTERESTS IS ALSO RESTRICTED BY ARTICLE IX
OF THE FOLLOWING AGREEMENT OF LIMITED PARTNERSHIP.

__________________

AGREEMENT OF LIMITED PARTNERSHIP

VENTURE ACQUISITIONS, L.P.

THIS AGREEMENT OF Limited Partnership (herein called this "Agreement")
dated as of September 23, 1994, is hereby entered into by and between Quest
Resources, L.L.C. and RIMCO Energy, Inc., a Texas corporation, as general
partners, (herein together called the "General Partners"), RIMCO Production
Company, Inc., a Delaware corporation, RIMCO Exploration Partners, L.P. I, a
Delaware limited partnership and RIMCO Exploration Partners, L.P. II, a
Delaware limited partnership, as limited partners (herein collectively called
the "Limited Partners").

ARTICLE I

Formation of Partnership

Section 1.2. Name. The name of the Partnership shall be Venture
Acquisitions, L.P. Subject to all applicable laws, the business of the
Partnership shall be conducted in the name of the Partnership unless under the
law of some jurisdiction in which the Partnership does business such business
must be conducted under another name. In such a case, the business of the
Partnership in such jurisdiction may be conducted under such other name or
names as the General Partners shall determine to be necessary so long as it
does not affect adversely the limited liability of the Limited Partners
hereunder. The words "Limited Partnership" shall be included in the
Partnership's name where necessary for the purpose of complying with the laws
of any jurisdiction that so requires. The General Partners shall cause to be
filed on behalf of the Partnership such partnership or assumed or fictitious
name certificate or certificates or similar instruments as may from time to
time be required by law.
<PAGE> 6
Section 1.3. Business. Subject to the other provisions of this
Agreement, the business of the Partnership shall be to: (a) acquire Leases; (b)
hold, maintain, renew, explore, drill, develop and operate Leases; (c) produce,
collect, store, treat, deliver, market, sell or otherwise dispose of oil, gas
and related hydrocarbons, minerals and other products from Leases; (d) farmout,
sell, abandon and otherwise dispose of Leases and assets; and (e) take all such
other actions incidental to any of the foregoing as the General Partners may
determine to be necessary or desirable.

Section 1.4. Places of Business. Registered Agent and Addresses.

(a) The principal United States office and place of business of the
Partnership and its street address shall be 5949 Sherry Lane, Suite 1616,
Dallas, Texas 75225. The Managing General Partner, at any time and from time
to time, may change the location of the Partnership's principal United States
office and place of business and may establish such additional place or places
of business of the Partnership as the Managing General Partner shall determine
to be necessary or desirable, provided notice thereof is concurrently given to
the other Partners.

(b) The registered office of the Partnership in Texas shall be 5949
Sherry Lane, Suite 1616, Dallas, Texas 75225, and the registered agent for
service of process on the Partnership shall be Anne L. Brigham, an individual
who is a resident of the State of Texas and whose business address is the same
as the Partnership's registered office. The Managing General Partner, at any
time and from time to time, may change the Partnership's registered office or
registered agent or both by complying with the applicable provisions of the Act
and giving concurrent notice thereof to the other Partners and may establish,
appoint and change additional registered offices and registered agents of the
Partnership in such other states as the Managing General Partner shall
determine to be necessary or advisable.

Section 1.5. Names and Addresses of Partners. The mailing addresses
and street addresses of the General Partners of the Partnership are as follows:

Quest Resources, L.L.C.
5949 Sherry Lane, Suite 1616
Dallas, Texas 75225
Attn: Ben M. Brigham

RIMCO Energy, Inc.
600 Travis Street, Suite 6875
Houston, Texas 77002
Attn: Gary J. Milavec

The names and mailing addresses of the Limited Partners are as follows:

RIMCO Production Company, Inc.
600 Travis Street, Suite 6875
Houston, Texas 77002
Attn: Paul E. McCollam

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RIMCO Exploration Partners, L.P. I
600 Travis Street, Suite 6875
Houston, Texas 77002
Attn: Paul E. McCollam

RIMCO Exploration Partners, L.P. II
600 Travis Street, Suite 6875
Houston, Texas 77002
Attn: Paul E. McCollam

Section 1.6. Term. The Partnership shall be formed and commence upon
the completion of filing for record of an initial certificate of limited
partnership of the Partnership with the Secretary of State of the State of
Texas (the "Effective Date") and shall continue until terminated in accordance
with Article X.

Section 1.7. Filings. Upon the request of the Managing General
Partner, the other Partners shall promptly execute and deliver all such
certificates and other instruments conforming hereto as shall be necessary for
the Managing General Partner to accomplish all fling, recording, publishing and
other acts appropriate to comply with all requirements for the formation and
operation of a limited partnership under the laws of the State of Texas and for
the qualification or reformation and operation of a limited partnership (or a
partnership in which the Limited Partners have limited liability) in all other
jurisdictions where the Partnership shall propose to conduct business.

Section 1.8. Title to Partnership Property. All property owned by the
Partnership, whether real or personal, tangible or intangible, shall be deemed
to be owned by the Partnership as an entity, and no Partner, individually,
shall have any ownership of such property. The Partnership shall hold all of
its assets in the name of the Partnership. The General Partners shall promptly
take all such action as they shall deem necessary or appropriate, or as may be
required by law, to perfect and preserve the ownership interest of the
Partnership in all Leases.

ARTICLE II

Certain Definitions and References

Section 2.1. Certain Defined Terms. (a) When used in this Agreement,
the following terms shall have the respective meanings assigned to them in this
Section 2.1 or in the sections and subsections referred to below:

"Acquisition Cost" shall mean, with respect to any Lease acquired by the
Partnership, the sum of (a) third party costs incurred in evaluating Leases for
acquisition, including without limitation engineering costs, due diligence
expenses and environmental studies, (b) the price paid or contractually agreed
to be paid by the Partnership for such Lease to the optionor, lessor, assignor,
grantor, maker, holder or owner of such Lease, including consideration paid to
an assignor, lease or option bonuses, advance rentals and other

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acquisition costs, (c) title insurance or examination costs, brokers
commissions, attorneys' fees, filing fees, recording costs, transfer and sales
taxes, if any, and other similar costs incurred by the Partnership with respect
to such Lease in connection with its acquisition, (d) third party costs and
expenses incurred in connection with the negotiation of an agreement to
purchase or otherwise acquire any Lease, (e) all interest and other financing
expenses, including related legal expenses incurred by the Partnership or an
Affiliate with respect to such Lease in connection with its acquisition, and (0
third party costs and expenses related to such Lease for transfer orders,
reconciliation, and documentation activities.

"Act" shall have the meaning assigned to it in Section 1.1.

"Adjusted Capital Account" shall mean the capital account maintained for
each Partner as provided in Section 8.1(b) as of the end of each fiscal year,
(a) increased by (i) the amount of any unpaid Capital Contributions agreed to
be contributed by such Partner under Article III, if any, (ii) an amount equal
to such Partner's allocable share of Minimum Gain, as computed on the last day
of such fiscal year in accordance with the applicable Treasury Regulation and
(iii) the amount of Partnership indebtedness allocable to such Partner under
Section 752 of the Internal Revenue Code with respect to which such Partner
bears the economic risk of loss to the extent such indebtedness does not
constitute Partner Nonrecourse Debt, and (b) reduced by (i) the amount of all
depletion deductions reasonably expected to be allocated to such Partner in
subsequent years and charged to such Partner's capital account as provided in
Section 8.1(b), (ii) the amount of all losses and deductions reasonably
expected to be allocated to such Partner in subsequent years under Sections
704(e)(2) and 706(d) of the Internal Revenue Code and Treasury Regulation
Section 1.751-1 (b)(2)(ii), and (iii) the amount of all distributions
reasonably expected to be made to such Partner to the extent they exceed
offsetting increases to such Partner's capital account that are reasonably
expected to occur during (or prior to) the year in which such distributions are
reasonably expected to be made.

"Affiliate" shall mean (a) any person directly or indirectly
controlling, controlled by or under common control with a General Partner, and
(b) any officer, director or partner of a General Partner or of any person
described in subsection (a) of this paragraph. As used in this Agreement, the
term "person" shall include an individual, an estate, a corporation, a
partnership, an association, a joint stock company and a trust.

"Agreed Rate" shall mean a rate per annum which is equal to the lesser
of (a) a rate which is two percent (2%) above the prime rate of interest of
Bank One, Texas, National Association, or any successor bank, as announced or
published by such bank from time to time (adjusted from time to time to reflect
any changes in such rate determined hereunder) or (b) the maximum rate from
time to time permitted by applicable law.

"BOG" shall mean Brigham Oil & Gas, L.P.

"BOG AMI" shall mean those areas designated by BOG and other
participants as an area of mutual interest for exploration and development as
set forth in one or more letter agreements, geophysical exploration agreements
or other agreements by and among BOG and such participants, or if not set forth
in an agreement, as designated by BOG based on

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structural or stratigraphic conditions making an area susceptible to the
accumulation of oil or gas and/or on existing Lease acreage held or agreed to
be acquired by such parties.

"Brigham" shall mean Quest Resources, L.L.C.

"Capital Contributions" shall mean for any Partner at the particular
time in question the aggregate of (i) the dollar amounts of any cash
contributed to the capital of the Partnership, or, if the context in which such
term is used so indicates, the dollar amounts of cash agreed to be contributed,
or requested to be contributed, by the Partner to the capital of the
Partnership and (ii) the fair market value of any property contributed to the
Partnership by such Partner.

"Capital Costs" shall mean all costs incurred by the Partnership (a) for
Acquisition Costs for Leases; (b) all third party geological and geophysical
costs incurred by the Partnership in connection with wells drilled or proposed
to be drilled on Leases; (c) in locating, drilling, completing, equipping,
deepening, reworking, plugging back, recompleting, redrilling or sidetracking a
well, including without limitation (i) all costs incurred for abstracting,
title examination and opinions for the drillsite for such well, all costs
incurred from archaeology and similar studies for, and the surveying and
staking of, such well and all costs incurred for surface damages, clearing,
exploring, coring, testing, logging and evaluating such well, (ii) the costs of
casing, cement and cement services for such well, (iii) the cost of plugging
and abandoning such well if it is determined that such well would not produce
in commercial quantities and should be abandoned, (iv) all direct charges and
overhead chargeable to the Partnership with respect to such well under any
applicable operating agreement in order to make such well ready for production,
including the installation and testing of wellhead equipment, or to plug and
abandon a dry hole; (v) all costs of controlling a blow-out of a Partnership
well; (c) in conducting enhanced recovery operations; (d) in constructing and
acquiring facilities and equipment necessary to develop the Leases and produce,
collect, store, treat, deliver, market, sell or otherwise dispose of oil, gas
and other hydrocarbons therefrom; (e) compensation to well operators,
consultants and others and insurance in connection with the foregoing and (fl
other costs and expenses of the Partnership which are required to be
capitalized (rather than deducted currently from income) for federal income tax
purposes; but such term shall not include (without limitation) any Lease
Operating Costs.

"Consulting Engineer" shall be such firm of independent petroleum
engineers as shall be designated by the Managing General Partner and agreed to
by the other General Partner.

"Effective Date" shall have the meaning assigned to it in Section 1.6.

"Farmout" shall mean an agreement by which the Partnership agrees to
assign all or part of its interest in specific acreage to another party (the
"farmee"), retaining some interest (such as an overriding royalty interest, an
oil and gas payment, a working interest after payout or other type of
interest), subject to a requirement that the farmee drill one or more specific
wells or perform other acts as a condition of the assignment.

"Deficit Partner" shall have the meaning assigned to it in Section
4.3(i).

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"General Partners" shall mean Quest Resources, L.L.C., a Texas limited
liability company, and RIMCO Energy, Inc., a Texas corporation, as general
partners of the Partnership, or any successor general partners of the
Partnership pursuant to the terms hereof.

"Internal Revenue Code" or "Code" shall mean the Internal Revenue Code
of 1986, as amended from time to time, and any successor statute or statutes.

"Lease" shall mean a lease, option (including without limitation, any
option to secure a Lease and/or to conduct seismic or other geophysical
activities), mineral interest, royalty or overriding royalty, fee right,
license, concession or other right covering oil, gas and related hydrocarbons
(or a contractual right to acquire such an interest) or an undivided interest
therein or portion thereof, together with all pipelines, wells, equipment and
other personal property and/or fixtures associated therewith and all
appurtenances thereto and servitudes associated therewith, located within the
United States.

"Lease Operating Costs" shall mean all costs incurred by the Partnership
in connection with the operation or maintenance of its Leases (except drilling
and similar obligations) and the production and marketing of oil, gas and
related hydrocarbons from completed wells in which the Partnership has an
interest pursuant to this Agreement, all delay rentals, shut-in royalties,
extension fees, additional bonus consideration and similar payments, burdens of
record, labor, fuel, repairs, transportation, supplies, utility charges, ad
valorem, severance, excise and similar taxes, the cost of reworking or plugging
back any well that has previously been a producing well for 60 days or more and
compensation to well operators, consultants and others and insurance in
connection with the foregoing; but such term shall not include (without
limitation) any Capital Costs.

"Limited Partners" shall mean RIMCO Production Company, Inc,. a Delaware
corporation, RIMCO Exploration Partners, L.P. I, a Delaware limited
partnership, RIMCO Exploration Partners, L.P. II, a Delaware limited
partnership, and any person who becomes an additional or a substituted Limited
Partner of the Partnership pursuant to the terms hereof.

"Managing General Partner" shall mean Quest Resources, L.L.C.

"Minimum Gain" shall mean (i) with respect to Partnership Nonrecourse
Liabilities, the amount of gain that would be realized by the Partnership if it
disposed of (in a taxable transaction) all Partnership properties that are
subject to Partnership Nonrecourse Liabilities in full satisfaction of
Partnership Nonrecourse Liabilities, computed in accordance with applicable
Treasury Regulations, or (ii) with respect to each Partner Nonrecourse Debt,
the amount of gain that would be realized by the Partnership if it disposed of
(in a taxable transaction) the Partnership property that is subject to such
Partner Nonrecourse Debt in full satisfaction of such Partner Nonrecourse Debt,
computed in accordance with applicable Treasury Regulations.

"Organization Costs" shall mean all legal costs and expenses incurred in
connection with the formation of the Partnership and the preparation,
negotiation and execution of this Agreement and the other documents and
instruments referred to herein.

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"Partner Nonrecourse Debt" shall mean any nonrecourse debt of the
Partnership (or portions thereof) for which any Partner bears the economic risk
of loss.

"Partner Nonrecourse Deductions" shall mean the amount of deductions,
losses and expenses equal to the net increase during the year in Minimum Gain
attributable to a Partner Nonrecourse Debt, reduced (but not below zero) by
proceeds of such Partner Nonrecourse Debt distributed during the year to the
Partners who bear the economic risk of loss for such debt, as determined in
accordance with applicable Treasury regulations.

"Partners" shall mean the General Partners and the Limited Partners.

"Partnership" shall have the meaning assigned to it in Section 1.1.

"Partnership Nonrecourse Liabilities" shall mean nonrecourse liabilities
(or portions thereof) of the Partnership for which no Partner bears the
economic risk of loss.

"Payout 1" shall mean the point in time at which the aggregate cash
distributions which the Limited Partners and the RIMCO General Partner shall
have received from the Partnership from revenue allocated and credited to their
respective accounts pursuant to Section 4.2, when discounted back from the
respective dates made to the Effective Date at a rate equal to 15% per annum,
shall equal the aggregate Capital Contributions made by the Limited Partners
and the RIMCO General Partner pursuant to Article III, which Capital
Contributions shall be discounted back from the respective dates made to the
Effective Date, at a rate equal to 15% per annum; provided, however, that
Payout 1 may not occur until the earlier of: (a) 24 months following the
Effective Date, or (b) such time as all committed Capital Contributions
provided in Sections 3.1 and 3.2 have been called for payment to the
Partnership.

"Payout 2" shall mean the point in time at which the aggregate cash
distributions which the Limited Partners and the RIMCO General Partner shall
have received from the Partnership from revenue allocated and credited to their
respective accounts pursuant to Section 4.2, when discounted back from the
respective dates made to the Effective Date at a rate equal to 20% per annum,
shall equal the aggregate Capital Contributions made by the Limited Partners
and the RIMCO General Partner pursuant to Article III, which Capital
Contributions shall be discounted back from the respective dates made to the
Effective Date, at a rate equal to 20% per annum.

"Positive Partner" shall have the meaning assigned to it in Section
4.3(j).

"Prospect" shall mean with respect to BOG an area with structural or
stratigraphic conditions making it appear susceptible to the accumulation of
oil or gas, in which BOG owns one or more Leases and/or Farmouts, which area
shall have been designated in writing by its Managing General Partner (as
defined in the Agreement of Limited Partnership of BOG), to all depths on the
basis of geological and geophysical data available to such Managing General
Partner at the time of each acquisition of a Lease by BOG or a third party and
with the reasonable anticipation that such area shall contain each entire
reservoir in which BOG acquires an interest by virtue of the ownership of such
Leases. Such area shall

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be enlarged from time to time by such Managing General Partner on the basis of
any subsequently acquired geological or geophysical data. The term "Prospect"
shall also mean the Leases owned by BOG within or covering the designated area
and/or the wells, pipelines, equipment and other personal property and/or
fixtures on or used in connection therewith whenever the context in which such
term is used shall require.

"Proved Reserves" shall mean petroleum reserves that have been proved to
a high degree of certainty by analysis of the producing history of a reservoir
and/or by volumetric analysis of adequate geological and engineering data, the
commercial productivity of which has been established by actual production,
successful testing or in certain cases by favorable core analyses and
electrical-log interpretation when the producing characteristics of the
formation are known from nearby fields. Volumetrically, the structure, areal
extent, volume and characteristics of the reservoir containing Proved Reserves
shall be well defined by a reasonable interpretation of adequate subsurface
well control and by known continuity of hydrocarbon-saturated material above
known fluid contacts, if any, or above the lowest known structural occurrence
of hydrocarbons. Reserves recoverable by enhanced recovery methods, such as
the injection of external fluids to provide energy not inherent in the
reservoirs, may be considered to be proved only in cases where a successful
fluid-injection program is in operation, a pilot program indicates successful
fluid injection, or information is available concerning the successful
application of such methods in similar reservoirs in the general area.

"RIMCO" shall mean the RIMCO General Partner and the Limited Partners
collectively.

"RIMCO General Partner" shall mean RIMCO Energy, Inc., a Texas
corporation.

"Simulated Basis", "Simulated Depletion", "Simulated Gain", and
"Simulated Loss" shall have the meanings assigned to such terms in Section
8.1(b).

Whenever "third party costs or expenses" are referred to in this
Agreement, the General Partners shall mutually agree upon the determination
that such costs or expenses are incurred by a third party.

Section 2.2. References and Title. All references in this Agreement to
articles, sections, subsections and other subdivisions refer to corresponding
articles, sections, subsections and other subdivisions of this Agreement unless
expressly provided otherwise. Titles appearing at the beginning of any of such
subdivisions are for convenience only and shall not constitute part of such
subdivisions and shall be disregarded in construing the language contained in
such subdivisions. The words "this Agreement", "this instrument", "herein",
"hereof", "hereby", "hereunder" and words of similar import refer to this
Agreement as a whole and not to any particular subdivision unless expressly so
limited. Words in the singular form shall be construed to include the plural
and vice versa, unless the context otherwise requires.

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ARTICLE III

Capitalization

Section 3.1. Capital Contributions of General Partners.

(a) The General Partners shall contribute in cash to the Partnership
the following maximum amounts in accordance with the provisions of subsection
(b) below and Section 3.3: (i) $250,000.00 by the Managing General Partner, and
(ii) $2,375,000.00 by the RIMCO General Partner.

(b) Subject to Section 3.1(a) above, the General Partners shall
contribute in cash to the Partnership such amounts as shall be necessary to pay
timely the costs and expenses allocated and charged to the General Partners
hereunder; provided, however, that the General Partners shall not be required
to make Capital Contributions to pay their share of any costs or expenses
allocated or charged to them under this subsection (b) unless the Limited
Partners are then required to make Capital Contributions to pay their share of
such costs or expenses allocated or charged to them hereunder. Such Capital
Contributions shall be paid to the Partnership by the General Partners from
time to time in the appropriate amounts concurrently with each payment to the
Partnership by the Limited Partners of their Capital Contributions (including
any reserves for the payment of Acquisition Costs).

Section 3.2. Capital Contributions of Limited Partners. The Limited
Partners shall contribute in cash to the Partnership the following maximum
amounts as such amounts are called for by the ManAging General Partner as shall
be necessary to pay timely the costs and expenses allocated and charged to the
Limited Partners hereunder: (a) $527,777.78 by RIMCO Production Company, Inc.;
(b) $1,583,333.33 by RIMCO Exploration Partners, L.P. I; and (c) $263,888.89 by
RIMCO Exploration Partners, L.P. II.

Section 3.3. Requests and Payments of Capital Contributions.

(a) Except as otherwise provided herein, the Partners shall pay their
Capital Contributions upon request by the Managing General Partner in such
amounts as are required to pay their share of all costs and expenses properly
allocated to them hereunder for all costs and expenses estimated to have been
and/or to be incurred by the Partnership, except those for which advances have
previously been made or for which payment will be made from another source.

(b) Any request for payment of Capital Contributions by the Partners
shall be in writing, shall not exceed the amount reasonably estimated to be
required by the Partnership for the thirty (30) day period immediately
following the date of request and shall set forth (i) the net amount of the
Capital Contributions to be paid by each Partner which may not be less than $
100,000 in the aggregate for all Partners, (ii) the date by which payment of
such Capital Contributions shall be received, which shall not be less than 10
business days from the date the notice is sent unless the General Partners
agree to a shorter time period in which such payments are to be received, and
(iii) an option to authorize the retention of revenues otherwise distributable
to the Partners in payment of such Capital Contributions, if applicable.

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(c) Payments by the Partners of their Capital Contributions shall be
made by wire transfer of immediately available funds to the Partnership's
account as designated by the Managing General Partner by notice to the Partners
pursuant to Section 12.1.

(d) Any Capital Contributions agreed to be made pursuant to Sections
3.1 and 3.2 may not be requested after the termination of the first full 24
months of the Partnership term.

Section 3.4. Reduced Capital Contributions of Partners. In the event
the Partnership properly retains a portion of a Partner's share of Partnership
revenues pursuant to Section 3.6(c), the amount so retained and not distributed
shall reduce pro tanto the amount of Capital Contributions such Partner is
required to thereafter make.

Section 3.5. Request for Additional Capital Contributions of Partners.
If the Managing General Partner (a) determines that cost overruns exist in
excess of Partnership capital and revenues on current drilling activities by
the Partnership, or (b) proposes to pursue development opportunities that exist
on Partnership properties, after the earlier of (i) the end of the first full
24 months of the Partnership term or (ii) when all committed Capital
Contributions set forth in Sections 3.1 and 3.2 have been made, the Managing
General Partner with the mutual agreement of the RIMCO General Partner may
request additional Capital Contributions from the Partners to be used for the
payment of costs associated with such drilling or development activities.
Payments of any additional Capital Contributions agreed to be made by the
Partners pursuant to this Section 3.5 shall be requested by the Managing
General Partner and made by the Partners in the manner provided for in Section
3.3.

If any Partner declines to make any additional Capital Contributions
requested by the Managing General Partner or fails to give timely notice to the
Managing General Partner in accordance with this Section 3.5, the General
Partners shall (A) reduce such Partner's interest in the Partnership in the
manner set forth in Section 3.6(b) with respect to cost overruns and (B) elect
one or more of the following with respect to all development activities:

(1) Cause the Partnership (to the extent it can do so under
any applicable operating agreement) to abandon the proposed operation in
which event all costs (if any) thereafter incurred in abandoning the
operation or acquisition shall be borne by the Partnership.

(2) Cause the Partnership to sell, farmout or otherwise
dispose of the well (or the applicable part thereof) to which such
proposed operation pertains to any person.

(3) Cause the Partnership to elect not to participate in the
proposed operation and to assume the status of a "non-consenting party"
under any operating agreement.

(4) Either General Partner or any of its Affiliates that has
agreed to make such requested contribution may pursue for its own
benefit such activities.

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Section 3.6. Non-Payment of Capital Contributions.

(a) The Partnership shall have the right to pursue the remedies
described in this Section 3.6 and any remedy existing at law or in equity for
the collection of the unpaid amount of the Capital Contributions agreed to be
made in Sections 3.1 and 3.2 or hereafter agreed to be made in accordance with
Section 3.5, including without limitation the prosecution of a suit against a
defaulting Partner.

(b) In the event that any Partner should fail or refuse to pay when
due a call of its Capital Contributions under Sections 3.1 or 3.2 as requested
pursuant to Section 3.3 and such payment remains unpaid for 20 calendar days
from the date due, or in the event of a cost overrun with respect to which a
Partner has failed to make additional Capital Contributions pursuant to Section
3.5, then (i) such Partner's interest in the Partnership shall be reduced by a
percentage equal to 100 times a fraction, the numerator of which shall equal
the sum of such Partner's (A) committed capital amount provided in Section 3.1
and 3.2, as applicable, and (B) proportionate share of cost overruns pursuant
to Section 3.5, minus the aggregate amount of all Capital Contributions
theretofore made by such Partner, and the denominator of which shall equal the
sum of (A) and (B) above, and (ii) with respect to a General Partner, it shall
have no rights as to decisions pursuant to Section 6.2 for such period of time
as such Capital Contribution shall remain unpaid.

(c) In the event that a Limited Partner fails or refuses to make when
due its share of Capital Contributions, the RIMCO General Partner shall be
entitled to make such Capital Contributions to the Partnership which the
defaulting Limited Partner is obligated to make and the amount so advanced
shall bear interest from the date of such advance at a rate equal to the Agreed
Rate. The RIMCO General Partner shall notify a defaulting Limited Partner of
any such advance and request payment by such Limited Partner of the amount so
advanced, together with interest thereon from the date of the advance. In the
event the RIMCO General Partner elects not to make such an advance, the
Managing General Partner shall have the right, but not the obligation, to
advance the entire amount.

(d) In the event that a Partner fails or refuses to make when due its
share of Capital Contributions, the Partnership may withhold any revenues
otherwise distributable to such Partner pursuant to this Agreement in an amount
equal to the amount such Partner fails or refuses to contribute as required
pursuant to the terms of this Agreement, together with interest on such
past-due amounts at a rate equal to the Agreed Rate. Any amount so withheld
shall be deemed to have been recontributed by the Partner to the capital of the
Partnership for the purposes for which contributions were initially called. To
the extent that a General Partner has advanced funds to the Partnership as a
result of the default of a Partner, such General Partner shall be entitled to
be reimbursed from the amounts so withheld from the defaulting Partner in
accordance with this Section 3.6.

Section 3.7. Return of Capital Contributions. Except as provided in
Section 3.8, no interest shall accrue on any contributions to the capital of
the Partnership; and no Partner shall have the right to withdraw or be repaid
any capital contributed by such Partner except as otherwise specifically
provided in this Agreement.

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Section 3.8. Payments and Advances by General Partners. The General
Partners shall have the right to pay any indebtedness or obligation of the
Partnership out of funds of the General Partners, and may bill the Partnership
in the same manner that the Partnership may bill the Limited Partners.
Further, if at any time the General Partners advance funds to or on behalf of
the Partnership or the General Partners are required to pay any indebtedness or
obligation of the Partnership in excess of the Capital Contributions of the
General Partners agreed to be made in this Article III, such advance or payment
shall constitute a loan by the General Partners to the Partnership. Such
advance or payment shall thereafter bear interest at a rate equal to the lesser
of (a) the maximum contract rate permitted by applicable law, (b) the effective
rate of interest then being paid by the General Partners for funds acquired by
the General Partners to pay such advance or payment (adjusted from time to time
to reflect any changes in such applicable rate) or (c) the amount which an
unrelated bank would charge the Partnership (without reference to the General
Partners' financial abilities or guarantees) on a comparable loan for the same
purpose. No such advance or payment by the General Partners shall be deemed to
be a contribution by the General Partners to the capital of the Partnership.
Any advances by the General Partners (other than (i) for a required payment by
the General Partners of any indebtedness or obligation of the Partnership in
excess of the Capital Contributions of the General Partners agreed to be made
in this Article III, or (ii) a payment by the General Partners of any costs and
expenses allocated and charged to the Limited Partners upon the default by the
Limited Partners in the payment of any Capital Contributions previously agreed
to be made by the Limited Partners) shall be subject to the limitations on
borrowing specified in Section 6.2(a). Any loan made by the General Partners
hereunder to pay any costs or expenses allocated and charged to any Partner
shall be repaid (with payments to be applied first to the payment of interest
and then to the repayment of principal) from the revenues that would otherwise
be next distributed to such Partner hereunder.

ARTICLE IV

Allocations and Distributions

Section 4.1. Allocation of Costs and Expenses. Except as provided in
Sections 3.5 and 3.6, all costs and expenses of the Partnership shall be
allocated and charged to the Partners as follows:

(a) All Capital Costs incurred by the Partnership shall be allocated
(i) prior to Payout 1, 5.0% to Brigham, 47.5% to the RIMCO General Partner,
10.55% to RIMCO Production Company, Inc., 31.67% to RIMCO Exploration Partners,
L.P.I and 5.28% to RIMCO Exploration Partners, L.P. II; (ii) after Payout 1 and
prior to Payout 2, 25% to Brigham, 37.5% to the RIMCO General Partner, 8.33% to
RIMCO Production Company, Inc., 25% to RIMCO Exploration Partners, L.P. I and
4.17% to RIMCO Exploration Partners, L.P. II; and (iii) after Payout 2, 50% to
Brigham, 25% to the RIMCO General Partner,5.55% to RIMCO Production Company,
Inc., 16.67% to RIMCO Exploration Partners, L.P. I and 2.78% to RIMCO
Exploration Partners, L.P. II.

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(b) All Organization Costs incurred by the Partnership or by the
Partners on behalf of the Partnership shall be allocated: (i) with respect to
the first $25,000 of such costs, 35% to Brigham, 32.5% to the RIMCO General
Partner, 7.22% to RIMCO Production Company, Inc., 21.67% to RIMCO Exploration
Partners, L.P. I and 3.61% to RIMCO Exploration Partners, L.P.II; and (ii) with
respect to any Organization Costs in excess of $25,000, 50% to Brigham, 25% to
the RIMCO General Partner, 5.55% to RIMCO Production Company, Inc., 16.67% to
RIMCO Exploration Partners, L.P.I and 2.78% to RIMCO Exploration Partners,
L.P.II.

(c) All other costs and expenses incurred by the Partnership shall be
allocated: (i) prior to PaYout 1, 10% to Brigham, 45% to the RIMCO General
Partner, 10% to RIMCO Production Company, Inc., 30% to RIMCO Exploration
Partners, L.P. I and 5% to RIMCO Exploration Partners, L.P. II; (ii) after
Payout 1 and prior to Payout 2, 25% to Brigham, 37.5% to the RIMCO General
Partner, 8.33% to RIMCO Production Company, Inc., 25% to RIMCO Exploration
Partners, L.P. I and 4.17% to RIMCO Exploration Partners, L.P. II; and (iii)
after Payout 2, 50% to Brigham, 25% to the RIMCO General Partner, 5.55 % to
RIMCO Production Company, Inc., 16.67 % to RIMCO Exploration Partners, L.P. I
and 2.78% to RIMCO Exploration Partners, L.P. II.

(d) Notwithstanding the foregoing provisions of this Section 4.1,
costs paid with proceeds of a Partner Nonrecourse Debt shall be allocated and
charged to the Partners in proportion to the ratio in which the Partners bear
the economic risk of loss for such Partner Nonrecourse Debt.

Section 4.2. Allocation of Revenues. Except as provided in Sections
3.5 and 3.6, all revenues of the Partnership (which shall not include Capital
Contributions and loans to the Partnership) shall be allocated and credited to
the Partners as follows:

(a) Insurance proceeds shall be allocated among the Partners
in the same proportions in which the Partners bear the costs of
insurance.

(b) All revenues used to repay any principal, interest or
other amounts owing with respect to any Partnership borrowings or
indebtedness shall be allocated to the Partners in the same proportions
as the costs and expenses paid with such borrowings or indebtedness were
allocated to the Partners (and, with respect to any indebtedness to
which any property acquired by the Partnership is subject at the time of
its acquisition, in the same proportions as costs are allocated under
Section 4.1 at the time such property is acquired by the Partnership).

(c) After making the allocation provided in Section 4.2(b) and
taking into account the revenues allocated therein, all additional
revenues resulting from the sale or other disposition of depletable
property (as defined in Section 4.3(b)) shall be allocated to the
Partners in the same percentages as the costs of the property sold were
allocated up to an amount equal to the Partnership's Simulated Basis in
such property at the time of such sale. Thereafter, revenues resulting
from such sale or disposition shall be allocated to the Partners in a
manner which will cause the aggregate of all revenues allocated to the
Partners from such sale or other disposition

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(to the extent possible) to equal the amounts which would have been
allocated to the Partners under subsection (d) of this Section 4.2 in
the absence of this subsection (c).

(d) All other revenues or sales proceeds of the Partnership
not specifically allocated above shall be allocated: (A) Prior to Payout
1, 10% to Brigham, 45% to the RIMCO General Partner, 10% to RIMCO
Production Company, Inc., 30% to RIMCO Exploration Partners, L.P. I and
5% to RIMCO Exploration Partners, L.P. II; (B) after Payout 1 and prior
to Payout 2, 25% to Brigham, 37.5% to the RIMCO General Partner, 8.33%
to RIMCO Production Company, Inc., 25% to RIMCO Exploration Partners,
L.P. I and 4.17 % to RIMCO Exploration Partners, L.P. II; and (C) after
Payout 2, 50% to Brigham, 25% to the RIMCO General Partner, 5.55% to
RIMCO Production Company, Inc., 16.67% to RIMCO Exploration Partners,
L.P. I and 2.78% to RIMCO Exploration Partners, L.P. II.

Section 4.3. Income Tax Allocations. Except as otherwise provided
herein, for purposes of any applicable federal, state or local income tax law,
rule or regulations items of income, gain, deduction, loss and credit shall be
allocated to the Partners as follows:

(a) Income from the sale of oil or gas production shall be allocated
in the same manner as revenue is allocated and credited pursuant to Section
4.2.

(b) Cost and percentage depletion deductions and the gain or loss on
the sale or other disposition of property the production from which is or would
be (in the case of nonproducing properties) subject to depletion (herein
sometimes called "depletable property") shall be computed separately by the
Partners rather than the Partnership. For purposes of Section 613A(c)(7)(D) of
the Internal Revenue Code, the Partnership's adjusted basis in each depletable
property shall be allocated to the Partners in proportion to each Partner's
respective share of the costs and expenses which entered into the Partnership's
adjusted basis for each depletable property, and the amount realized on the
sale or other disposition of each depletable property shall be allocated to the
Partners in proportion to each Partner's respective share of the revenue from
the sale or the disposition of such property provided for in Section 4.2. For
purposes of allocating amounts realized upon any such sale or disposition which
are deemed to be received for federal income tax purposes and are attributable
to Partnership indebtedness or indebtedness to which the depletable property is
subject at the time of such sale or disposition, such amounts shall be
allocated in the same manner as Partnership revenues used for the repayment of
such indebtedness would have been allocated under Section 4.2(a)(ii).

(c) In accordance with Section 704(c) of the Internal Revenue Code
and the Treasury Regulations thereunder, income and deductions with respect to
any property contributed to the Partnership shall, solely for federal income
tax purposes, be allocated among the Partners in a manner to take into account
any variation between the adjusted tax basis of such property to the
Partnership and its fair market value at the time of contribution.

(d) Items of deduction, loss and credit not specifically provided for
above (other than loss from the sale or other disposition of Partnership
property), including depreciation,

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shall be allocated to the Partners in the same manner that the costs and
expenses of the Partnership that gave rise to such items of deduction, losses
and credit were borne.

(e) Gain from the sale or other disposition of Partnership property
that is not specifically provided for above shall be allocated to the Partners
in a manner which reflects each Partner's allocable share of the revenue from
the sale of the Partnership property provided for in Section 4.2, and loss from
the sale or other disposition of Partnership property that is not specifically
provided for above shall be allocated to the Partners in a manner which
reflects each Partner's allocable share of the costs and expenses of the
Partnership property provided for in Section 4.1.

(f) All recapture of income tax deductions resulting from the sale or
other disposition of Partnership property shall be allocated among the Partners
in the ratios in which the deductions giving rise to such recapture were
allocated, but each Partner shall be allocated recapture only to the extent
that such Partner is allocated any gain from the sale or other disposition of
such property. The balance of such recapture, if any, shall be allocated to
the Partner whose share of gain exceeds its share of recapture.

(g) Income resulting from the Partnership's receipt of dry hole,
bottom hole or similar contributions shall be allocated in the same manner as
the costs to which they were applied were allocated.

(h) Any other items of Partnership income or gain not specifically
provided for above shall be allocated in the same manner as such revenue is
allocated and credited pursuant to Section 4.2.

(i) Notwithstanding any of the foregoing provisions of this Section
4.3 to the contrary:

(i) If during any fiscal year of the Partnership there is a
net increase in Minimum Gain attributable to a Partner Nonrecourse Debt
that gives rise to Partner Nonrecourse Deductions, each Partner bearing
the economic risk of loss for such Partner Nonrecourse Debt shall be
allocated items of Partnership deductions and losses for such year
(consisting first of depreciation deductions with respect to property
that is subject to such Partner Nonrecourse Debt and then, if necessary,
a pro rata portion of the Partnership's other items of deductions and
losses, with any remainder being treated as an increase in Minimum Gain
attributable to Partner Nonrecourse Debt in the subsequent year) equal
to such Partner's share of Partner Nonrecourse Deductions, as determined
in accordance with applicable Treasury Regulations.

(ii) If for any fiscal year of the Partnership there is a net
decrease in Minimum Gain attributable to Partnership Nonrecourse
Liabilities, each Partner shall be allocated items of Partnership income
and gain for such year (consisting first of gain recognized, including
Simulated Gain, from the disposition of Partnership property subject to
one or more Partnership Nonrecourse Liabilities and then, if necessary,
a pro rata portion of the Partnership's other items of income and gain,
and

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if necessary, for subsequent years) equal to such Partner's share of
such net decrease (except to the extent such Partner's share of such net
decrease is caused by a change in debt structure with such Partner
commencing to bear the economic risk of loss as to all or part of any
Partnership Nonrecourse Liability or by such Partner contributing
capital to the Partnership that the Partnership uses to repay a
Partnership Nonrecourse Liability), as determined in accordance with
applicable Treasury Regulations.

(iii) If for any fiscal year of the Partnership there is a net
decrease in Minimum Gain attributable to a Partner Nonrecourse Debt,
each Partner shall be allocated items of Partnership income and gain for
such year (consisting first of gain recognized, including Simulated
Gain, from the disposition of Partnership property subject to Partner
Nonrecourse Debt, and then, if necessary, a pro rata portion of the
Partnership's other items of income and gain, and if necessary, for
subsequent years) equal to such Partner's share of such net decrease
(except to the extent such Partner's share of such net decrease is
caused by a change in debt structure or by the Partnership's use of
capital contributed by such Partner to repay the Partner's Nonrecourse
Debt) as determined in accordance with applicable Treasury Regulations.

(j) If for any fiscal year of the Partnership the allocation of any
loss or deduction (net of any income or gain) to any Partner would cause or
increase a negative balance in such Partner's Adjusted Capital Account as of
the end of such fiscal year (the "Deficit Partner") after taking into account
the provisions of subsection (i) of this Section 4.3, only the amount of such
loss or deduction that reduces the balance to zero shall be allocated to the
Deficit Partner and the remaining loss or deduction shall be allocated to the
Partner whose Adjusted Capital Account has a positive balance remaining at such
time (the "Positive Partner"). After any such allocation, any Partnership
income or gain (including Simulated Gain) that would otherwise be allocated to
the Deficit Partner shall be allocated instead to the Positive Partner up to an
amount equal to the Partnership loss or deduction allocated to the Positive
Partner under the preceding sentence; provided, however, that no allocation of
income, gain or amount realized shall be made under this sentence if the effect
of such allocation would be to cause the Adjusted Capital Account of the
Deficit Partner to be less than zero. If, after taking into account the
allocation in the first sentence of this Section 4.3(i), the Adjusted Capital
Account balance of the Deficit Partner remains less than zero at the end of a
fiscal year, a pro rata portion of each item of Partnership income or gain
(including Simulated Gain) otherwise allocable to the Positive Partner for such
fiscal year (or if there is no such income or gain allocable to the Positive
Partners for such fiscal year, all such income or gain (including Simulated
Gain) so allocable in the succeeding fiscal year or years) shall be allocated
to the Deficit Partner in an amount necessary to cause its Adjusted Capital
Account balance to equal zero; provided that no allocation under this sentence
shall have the effect of causing the Positive Partner's Adjusted Capital
Account to be less than zero. After any such allocation, any Partnership gain
(including Simulated Gain) resulting from the sale or other disposition of
Partnership property that would otherwise be allocated to the Deficit Partner
for any fiscal year under this Section 4.3 shall be allocated instead to the
Positive Partner until the amount of gain so allocated equals the amount of
gain (including Simulated Gain) previously allocated to such Deficit Partner
under the preceding sentence of this Section 4.3(i); provided, however, that no
allocation of gain (including

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Simulated Gain) shall be made under this sentence if the effect of such
allocation would be to cause the Adjusted Capital Account of the Deficit
Partner to be less than zero. The provisions of this Section 4.3(j) are
intended to constitute a "qualified income offset" within the meaning of
Treasury Regulation Section 1.704-1(b)(2)(ii)(d).

(k) It is the intention of the Partners that the allocations
described in subsections (i) and (j) of this Section 4.3 comply with the
requirements of Treasury Regulation Section 1.704 relating to Partnership
Nonrecourse Liabilities, Partner Nonrecourse Debt (minimum gain chargebacks),
and the "qualified income offset." To the extent any changes to these
allocations are required with respect to such items, the Managing General
Partner is hereby authorized to make such changes after notice to the Partners.

Section 4.4. Distributions. Distributions may be made (a) during the
first twenty-four (24) months of the Partnership term, or (b) during such time
as all Capital Contributions pursuant to Sections 3.1 and 3.2 have not been
made, if the General Partners mutually agree that such cash is not needed for
Partnership obligations. Thereafter, available cash funds (other than Capital
Contributions and any borrowed funds) shall be distributed monthly to the
Partners, less such amounts as the Managing General Partner reasonably
determines are needed for the payment of current or projected Partnership
obligations. All revenues of the Partnership shall be distributed to the
Partners in the same respective percentages as such revenues are allocated to
the Partners pursuant to Section 4.2, as adjusted pursuant to Sections 3.5 and
3.6, if applicable (after deducting therefrom the costs and expenses charged to
the Partnership pursuant to Section 4.1, as adjusted pursuant to Sections 3.5
and 3.6, if applicable, and elsewhere herein).

ARTICLE V

Partnership Properties

Section 5.1. Lease Acquisitions.

(a) Subject to this Section 5.1 and Sections 5.3 and 6.2, the
Partnership may acquire Leases on which at the time of acquisition by the
Partnership there is both (i) existing production and (ii) with respect to
which there are existing delineated 3-D drillsites (as determined in the
discretion of the Managing General Partner) for drilling and development by the
Partnership. For purposes of this Article V, the Managing General Partner
shall make all determinations of what constitutes a 3-D delineated prospect in
its reasonable discretion.

(b) The Partnership may also acquire additional Leases on which there
is no existing production if (i) an interest in such a Lease or Leases is
offered to the Partnership by RIMCO, BOG, Brigham, any of their Affiliates or
third parties, (ii) such acquisition is approved by the General Partners, and
(iii) sufficient Capital Contributions are available for such purpose pursuant
to Sections 3.1 and 3.2 or if the Partners have agreed to make additional
Capital Contributions for such purpose pursuant to Section 3.5.

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Section 5.2. Lease Sales.

(a) Subject to Section 6.2, the Managing General Partner may sell,
farmout, abandon or otherwise dispose of any Lease of the Partnership, on such
terms as the Managing General Partner deems reasonable and in the best
interests of the Partnership and the Partners.

(b) Except as expressly permitted in Sections 9.4, 9.5, 9.6 and 10.3,
neither a General Partner nor any of its Affiliates nor any of their employees
shall acquire, directly or indirectly, any Lease (or any interest therein) from
the Partnership unless the other General Partner has previously approved such
acquisition.

Section 5.3 BOG Activities and Area of Mutual Interest. The Partners
hereto specifically understand and agree that BOG and its Affiliates currently
conduct operations similar to those contemplated by the Partnership and agree
that BOG and its Affiliates may continue to engage and possess interests in
other business ventures of any and every type, independently and with others,
including, without limitation, the ownership, acquisition, exploration,
development, operation and management of oil and gas properties, and neither
the Partnership nor any Partner shall by virtue of this Agreement have any
right, title or interest in or to such independent ventures. Nevertheless,
during the term of this Agreement, BOG shall not acquire for its own account
Leases meeting the requirements of Section 5.1(a), unless Partnership funds are
insufficient or not then available for such acquisition and development or the
Partnership elects not to participate in a particular opportunity.
Notwithstanding any provision hereof to the contrary, BOG shall have no
obligation to offer to the Partnership an opportunity to acquire a Lease which
(a) at the time of acquisition (i) includes no producing properties or (ii)
does not have associated with it delineated 3-D prospects identified or
approved by BOG in its reasonable discretion, (b) is located within a Prospect
in which BOG currently owns (or thereafter properly acquires in accordance
herewith) an interest, whether or not such Prospect contains producing
properties and/or delineated 3-D prospects, (c) BOG is contractually prohibited
from offering to the Partnership or contractually obligated to offer to a third
party, or (d) is within or adjacent to a BOG AMI. In its discretion, BOG
and/or any Affiliate may offer the Partnership the right to acquire Leases that
BOG and/or any Affiliate elect not to acquire or to acquire an interest in
Leases that BOG and/or any Affiliate elect to acquire less than the total
available interest.

Section 5.4 Exclusive Dealings. Brigham and BOG agree not to pursue
an acquisition vehicle with a business purpose substantially similar to the
Partnership's purpose of acquiring producing properties with existing,
delineated 3-D prospects to drill and develop, with a company or financial
institution other than the RIMCO General Partner or any of the Limited
Partners, for a period of time which is the shorter of (a) 24 months from the
Effective Date, or (b) such time as all committed Capital Contributions set
forth in Sections 3.1 and 3.2 have been called for payment to the Partnership.

Section 5.5 Insurance. The Partnership shall obtain for its benefit,
insurance coverage as is customary for the types of business to be conducted by
the Partnership in such amounts and for such coverage as the General Partners
shall determine which shall include

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without limitation comprehensive general liability insurance, umbrella excess
coverage, operator's extra expense, worker's compensation and comprehensive
automobile liability.

ARTICLE VI

Management

Section 6.1. Power and Authority of Managing General Partner. Quest
Resources, L.L.C. shall serve as the Managing General Partner of the
Partnership. Except as provided in Section 6.2 and elsewhere in this Agreement
and except as otherwise provided by applicable law, the Managing General
Partner shall have full power and authority on behalf of the Partnership to
manage, control, administer and operate the properties, business and affairs of
the Partnership in accordance with this Agreement as is necessary or desirable
to conduct the day to day business and operations of the Partnership and to
carry out and bind the Partnership with respect to the decisions of the General
Partners in accordance with this Agreement and to do or cause to be done any
and all acts deemed by the Managing General Partner to be necessary or
appropriate thereto, and (except as aforesaid) the scope of such power and
authority shall encompass all matters in any way connected with such business
or incident thereto, including without limitation (except as aforesaid) the
power and authority:

(a) To maintain, develop, operate, manage and defend Partnership
property;

(b) To deal with the operators of properties in which the Partnership
holds an interest;

(c) To sell the production accruing to Leases and to execute gas
sales contracts, casinghead gas contracts, transfer orders, division orders or
any other instruments in connection with the sale of production from the
Partnership's interest in such Leases;

(d) To execute and deliver all checks, drafts, endorsements and other
orders for the payment of Partnership funds;

(e) To take all actions agreed to by the General Partners pursuant to
Section 6.2; and

(f) To take such other action, execute and deliver such other
documents and perform such other acts as may be deemed by the Managing General
Partner to be appropriate to carry out the business and affairs of the
Partnership in accordance with this Agreement.

Section 6.2. Management Decisions of the General Partners. All of the
following decisions with respect to the Partnership business shall require the
approval of both of the General Partners, and accordingly, neither General
Partner shall have the right to make any commitment or engage in any
undertaking on behalf of the Partnership with respect to such decisions until
the General Partners have reached an agreement with respect thereto:

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(a) To acquire Leases in accordance with the terms of this Agreement;

(b) To purchase or otherwise acquire other real or personal property
of every nature considered necessary or appropriate to carry on and conduct the
business of the Partnership;

(c) To borrow monies for the purchase, development and maintenance of
Partnership assets and other aspects of the Partnership's business and from
time to time to draw, make, execute and issue promissory notes and other
negotiable or nonnegotiable instruments and evidences of indebtedness; to
secure the payment of the sums so borrowed and to mortgage, pledge or assign in
trust all or any part of the property of the Partnership, and to assign any
monies owing or to be owing to the Partnership;

(d) To enter into any agreements of joint venture or partnership or
for sharing of risks, expenses or profits, with any person, firm, corporation,
government or agency thereof engaged in any business or transaction in which
the Partnership is authorized to engage;

(e) To explore and prospect by geological, geophysical or other
methods for the location of anomalies or other indications favorable to the
accumulation of oil and gas, including specifically the power to contract with
third parties for such purposes;

(f) To drill, re-drill, test, plug and abandon or complete and equip,
rework and recomplete any number of wells on Leases for the production of oil
and gas located thereunder; to contract with third parties for such purposes;
to carry out a program or programs of enhanced recovery operations on the
Leases of the Partnership and to do any and all other things necessary or
appropriate to carry out the terms and provisions of this Agreement which would
or might be done by a normal and prudent operator in the development, operation
and management of its own property;

(g) To enter into and execute exploration agreements, operating
agreements, drilling contracts, Farmouts, dry and bottom hole and acreage
contribution letters, participation agreements, gas processing agreements and
any other agreements customarily employed in the oil and gas industry in
connection with the acquisition, sale, development or operation of oil and gas
properties and agreements as to rights-of-way;

(h) To farmout, sell, assign, convey or otherwise dispose of, for
such consideration and upon such terms and conditions as the General Partners
may determine to be in the best interests of the Partnership, all or any part
of the Partnership property, any interest therein, or any interest payable
therefrom, and in connection therewith to execute and deliver such deeds,
assignments and conveyances containing such warranties as the General Partners
may determine to be appropriate;

(i) To purchase, lease, rent or otherwise acquire or obtain the use
of facilities, machinery, equipment, tools, materials and all other kinds and
types of real or personal property that may in any way be deemed necessary,
convenient or advisable in connection with carrying on the business of the
Partnership;

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(j) To pay delay rentals, bonus payments, shut-in gas royalty
payments, and any other amounts necessary or appropriate to the maintenance or
operation of any Partnership property;

(k) To make and to enter into such agreements and contracts with such
parties and to give such receipts, releases and discharges with respect to any
and all of the foregoing and any matters incident thereto as the General
Partners may deem advisable or appropriate;

(l) To procure and maintain in force such insurance as the General
Partners shall deem prudent to serve as protection against liability for loss
and damage which may be occasioned by the activities to be engaged in by the
Partnership or the General Partners on behalf of the Partnership;

(m) To permit easements, rights-of-way, mechanics and materialmens
liens, restrictions, title exceptions, reservations, encroachments and other
liens and encumbrances on Partnership properties;

(n) To sue and be sued, complain and defend in the name of and on
behalf of the Partnership;

(o) To quitclaim, surrender, release or abandon any Partnership
property, with or without consideration therefor;

(p) To appear and to represent the Partnership before any
governmental authority or regulatory agency and to make all necessary or
appropriate filings before such authority or agency; and

(q) To elect to go "non-consent" under any operating agreement
applicable to any Lease or well and to elect to pay the costs and expenses of
any non-consent party under any such operating agreement.

Section 6.3. Duties and Services of General Partners. The General
Partners shall comply in all respects with the terms of this Agreement and (a)
shall use their best efforts to cause their Affiliates to comply with the terms
of this Agreement and (b) in the conduct of the business and operations of the
Partnership, to cause the Partnership (i) to comply with the terms and
provisions of all agreements to which the Partnership is a party or to which
its properties are subject, (ii) to comply with all applicable laws, ordinances
or governmental rules and regulations to which the Partnership is subject and
(iii) to obtain and maintain all licenses, permits, franchises and other
governmental authorizations necessary with respect to the ownership of
Partnership properties and the conduct of Partnership business and operations.
With respect to the maintenance, development and operation of Leases, the
General Partners shall have the standard of care of a prudent and diligent
operator.

Section 6.4. Liability of General Partners.

(a) A General Partner shall not be liable, responsible or accountable
in damages or otherwise to the Partnership or the Limited Partners for, and
(subject to Section 6.5) the

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Partnership shall indemnify and save harmless each General Partner from, any
costs, expenses, losses or damages (including attorneys' fees and expenses,
court costs, judgments and amounts paid in settlement) incurred by reason of
its being a General Partner, provided it has acted in good faith on behalf of
the Partnership and in a manner within the scope of the authority granted to it
by this Agreement and in the best interests of the Partnership, and provided
further that (i) such General Partner was not guilty of gross negligence,
willful misconduct or breach of fiduciary duty with respect to such acts or
omissions and (ii) the satisfaction of any indemnification and any saving
harmless shall be from and limited to Partnership assets (which shall be
converted to cash to the extent necessary in a manner appropriate to protect
the interests of all Partners) and not from any Capital Contributions to be
made by the Limited Partners hereunder, and the Limited Partners shall not have
any personal liability on account thereof.

(b) Upon the occurrence of any accident, catastrophe or similar event
involving Partnership property or operations, the General Partners may cause
the Partnership to obtain funds from the following sources for use in paying
Partnership liabilities and expenses arising therefrom and to restore, preserve
and protect Partnership property damaged or threatened in connection therewith:
proceeds from insurance policies carried by the Partnership, Partnership
revenues, advances from the General Partners pursuant to Section 3.S, Capital
Contributions of the Partners with respect to their respective shares of such
liabilities, costs and expenses (to the extent they have agreed to do so),
loans from third parties and the sale of Partnership assets, all as provided
for elsewhere herein and subject to the restrictions contained in Section 6.2.
The General Partners shall use their reasonable best efforts to pay or cause to
be paid in a proper and timely manner any delay rentals, bonus payments and
shut-in gas payments and other similar payments which may be necessary to
maintain in force and effect any Lease; provided, however, that in the absence
of bad faith or willful misconduct, the General Partners shall not be liable to
the Partnership or the Limited Partners for any failure or neglect to pay
properly and timely any such rentals or payments.

Section 6.5. Limitations on Indemnification. The rights of the General
Partners under Section 6.4 with respect to indemnification from the Partnership
shall be subject to the provisions of Article 11 of the Act.

Section 6.6. Costs, Expenses and Reimbursement.

(a) Subject to the other express provisions of this Agreement, all
costs and expenses reasonably incurred in the Partnership's business shall be
paid from Partnership funds, including without limitation third party costs of
reports under Section 8.2, costs of any Consulting Engineer or other person
employed to prepare reserve reports, costs of field engineers, costs of
obtaining audits of the Partnership's books and records, outside legal costs,
accounting fees, insurance costs, general taxes and other direct costs and
expenses of the Partnership. The charge to the Partnership for the use of a
General Partner's or any of its Affiliates' properties and equipment, the basis
of pricing materials purchased by the Partnership from the General Partners or
any of their Affiliates and the basis of pricing material purchased by the
General Partners or any of its Affiliates from the Partnership shall be as
provided in Section 6.7 and in any applicable operating agreement. In the
event the Partnership and a third party jointly own any Lease and operations
thereon are conducted

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pursuant to an operating agreement, then (i) if the third party is designated
as operator thereunder, the Partnership shall pay the costs and expenses
charged to it thereunder, and (ii) if the Managing General Partner or one of
its Affiliates is designated as operator, the Managing General Partner or any
of its Affiliates shall receive for its account all compensation and
reimbursement provided to the operator thereunder.

(b) The Partnership from time to time shall pay directly, or shall
reimburse the General Partners for any payment by them of, (i) all reasonable
fees and expenses incurred by them (including fees for outside legal services)
in connection with the preparation and fling of all certificates, opinions and
documents required pursuant to Sections 1.2 and 1.7, and (ii) all fees and
expenses incurred by them in obtaining reports of outside consultants and
advisors for the Partnership.

Section 6.7 Contracts With Affiliates. The Partnership may enter into
contracts and agreements with a General Partner and/or its Affiliates for the
rendering of services and the sale and lease of supplies and equipment,
provided that the amount of the compensation, price or rental that can be
charged to the Partnership therefor must be no less favorable to the
Partnership than those available from unrelated third patties in the area
engaged in the business of rendering comparable services or selling or leasing
comparable equipment and supplies which could reasonably be made available to
the Partnership, and provided further, that any such contract for services
shall be terminable by the Partnership without penalty upon 60 days' prior
written notice. The Partners also acknowledge that any Partner or its
Affiliates shall have the right to sell properties meeting the requirements of
Section 5.1 to the Partnership. Any such sale of properties and any sale or
lease of supplies and equipment and rendering of services may include
recoupment of costs and expenses and a profit to the General Partner selling,
leasing or rendering such properties, assets or services.

Section 6.8. Tax Elections. The Managing General Partner shall make
the following elections on behalf of the Partnership:

(a) To elect in accordance with Section 263(c) of the Internal
Revenue Code and applicable regulations and comparable state law provisions, to
deduct as an expense all intangible drilling and development costs with respect
to productive and non-productive wells and the preparation of wells for the
production of oil or gas;

(b) To elect the calendar year as the Partnership's fiscal year;

(d) To elect, in accordance with Sections 195 and 709 of the Internal
Revenue Code and applicable regulations and comparable state law provisions, to
treat all organization costs of the Partnership.as deferred expenses
amortizable over 60 months;

(e) If a Partner requests, to elect, in accordance with Sections 734,
743 and 754 of the Internal Revenue Code and applicable regulations and
comparable state law provisions, to adjust basis in the event any Partnership
interest is transferred in accordance with this Agreement or any Partnership
property is distributed to any Partner; and

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(f) To elect with respect to such other federal, state and local tax
matters as the General Partners shall agree upon from time to time.

In addition to the foregoing, if the Managing General Partner deems it in the
best interests of the Partnership, it shall cause any partnership or tax
partnership in which the Partnership owns or acquires an interest to elect, in
accordance with Section 754 of the Internal Revenue Code and applicable
regulations and comparable state law provisions, to cause the basis of such
Partnership property to be adjusted for federal income tax purposes as provided
by Sections 734 and 743 of the Internal Revenue Code.

Section 6.9. Tax Returns. The Managing General Partner shall prepare
or cause to be prepared using the accrual method of accounting and file all
federal, state and local income and other tax returns and reports as may be
required as a result of the business of the Partnership. The Managing General
Partner shall provide such information as is reasonably necessary for the
Partners to file their federal income tax returns or any state income tax
returns. The Managing General Partner shall be designated the tax matters
partner under Section 6231 of the Internal Revenue Code and is authorized to
take such actions and to execute and file all statements and forms on behalf of
the Partnership that are permitted or required by applicable provisions of the
Internal Revenue Code or Treasury Regulations issued thereunder, and the
Partners will take all other action that may be necessary or appropriate to
effect the designation of the Managing General Partner as the tax matters
partner. In the event of an audit of the Partnership's income tax returns by
the Internal Revenue Service, the Managing General Partner may, at the expense
of the Partnership, retain accountants and other professionals to participate
in the audit. All third party expenses incurred by the Managing General
Partner in its capacity as tax matters partner shall be expenses of the
Partnership and shall be paid or reimbursed to the Managing General Partner
from Partnership funds.

Section 6.10. Outside Activities and Resolution of Conflicts of
Interest.

(a) During the existence of the Partnership, the General Partners
shall devote such time and effort to the Partnership business and operations as
shall be necessary to promote fully the interests of the Partnership and the
mutual best interests of the Partners; however, it is specifically understood
and agreed that the General Partners shall not be required to devote full time
to Partnership business, and (subject to the other express provisions of this
Agreement) the Limited Partners acknowledge that the General Partners and their
Affiliates currently engage in and possess, and subject to Section 5.4, agree
that the General Partners may continue to engage in and possess, interests in
other business ventures of any and every type and description, independently or
with others, including, without limitation, the ownership, acquisition,
exploration, development, operation and management of oil and gas properties,
oil and gas drilling programs and partnerships similar to this Partnership,
including business interests and activities in direct competition with the
Partnership, and neither the Partnership nor the other Partners shall have any
right, title or interest in or to such independent ventures.

(b) Unless otherwise expressly provided in this Agreement, (i)
whenever a conflict of interest exists or arises between a General Partner, on
the one hand, and the Partnership

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or any Partner, on the other hand, or (ii) whenever this Agreement or any other
agreement contemplated herein provides that a General Partner shall act in a
manner which is, or provides terms which are, fair and/or reasonable to the
Partnership or any Partner, such General Partner shall resolve such conflict of
interest, take such action or provide such terms considering, in each case, the
relative interests of each party to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any
customary or accepted industry practices, and any applicable generally accepted
accounting or engineering practices or principles, and in the absence of bad
faith by such General Partner, the resolution, action or terms so made, taken
or provided by such General Partner shall not constitute a breach of this
Agreement or any other agreement contemplated herein or a breach of any
standard of care or duty imposed herein or under the Act or any other
applicable law, rule or regulation. Unless otherwise expressly provided in
this Agreement, any provision contained herein shall control to the fullest
extent possible if it is in conflict with such standard of care or duty, the
Act or any other applicable law, rule or regulation; and each Partner hereby
waives such standard of care or duty and the Act and such applicable law, rule
or regulation and agrees that the same shall be modified and/or waives to the
extent necessary to permit a General Partner to act as described above and to
give effect to the foregoing provisions.

(c) Whenever in this Agreement, a General Partner is permitted or
required to make decision (i) in its "sole discretion" or "discretion", or
under a grant of similar authority or latitude, such General Partner shall be
entitled to consider only such interests and factors as it desires and shall
have no duty or obligation to give any consideration to any interests of or
factors affecting the Partnership or the other Partners, or (ii) in its "good
faith" or under another express standard, such General Partner shall act under
such express standard and shall not be subject to any other or different
standards imposed by this Agreement or under the Act or any other applicable
law, rule or regulation. Each Partner hereby consents and agrees that a
General Partner may so act, waives any standard of care or duty imposed in this
Agreement or under the Act or any other applicable law, rule or regulation,
waives the rights and protection provided and afforded thereby, and agrees that
the same shall be modified and/or waived to the extent necessary to permit a
General Partner to act as described above and to give effect to the foregoing
provisions of this subsection.

(d) With respect to each transaction between a General Partner or any
of its Affiliates, on one hand, and the Partnership or any Partner on the other
hand, which is authorized by and/or consummated in accordance with Section 6.7
or this Section 6.10, each Partner hereby (i) consents and agrees to and
ratifies each such transaction to the extent that the Act and the laws of any
jurisdiction to which the Partnership or this Agreement is subject require the
consent to or approval or ratification of such transaction and (ii) agrees that
such consent, agreement and ratification shall be valid and effective despite
the fact that it is necessarily being given in advance and without full
disclosure of the facts and circumstances that will pertain to future
transactions of such nature.

(e) With respect to any activities of a General Partner or any of its
Affiliates permitted pursuant to Article V hereof, the other Partners waive any
right to participate in such activities and waive any conflict of interest in
connection with such General Partner or Affiliate's determination to pursue
such activities and/or acquisitions for its own account.

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Section 6.11. Other Matters Concerning a General Partner.

(a) A General Partner, and its officers, directors, partners,
employees, representatives, consultants and agents and any person acting at the
request of such General Partner (collectively, its "Agents") may rely and shall
be protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, or other paper or document reasonably believed by them
to be genuine and to have been signed or presented by the proper party or
parties.

(b) A General Partner and its Agents may consult with legal counsel,
accountants, appraisers, management consultants, investment bankers, and other
consultants and advisers selected by them and any opinion of any such person as
to matters which such General Partner or such Agents believe to be within such
person's professional or expert competence shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by such General Partner or its Agents hereunder in good faith and in
accordance with such opinion.

(c) In entering into contracts on behalf of the Partnership, the
Managing General Partner shall have the right, but not the obligation, to
require that the General Partners have no personal liability for the
obligations of the Partnership under such contracts without their consent.

(d) No person dealing with the Partnership shall be required to
inquire into the authority of the Managing General Partner to take any action
or make any decision hereunder.

ARTICLE VII

Rights and Obligations of Limited Partners

Section 7.1. Rights of Limited Partners. In addition to the other
rights specifically set forth herein, the Limited Partners shall have the right
to: (a) have access to the Partnership books and records as required by Section
1.07 of the Act, (b) have on demand true and full information of all things
affecting the Partnership and a formal account of Partnership affairs whenever
circumstances render it just and reasonable, (c) have dissolution and winding
up by decree of court as provided for in the Act and (d) exercise all rights of
a limited partner under the Act (except to the extent otherwise specifically
provided for herein).

Section 7.2. Limitations on Limited Partners. Except as expressly
provided in the Act, the Limited Partners shall not: (i) be permitted to take
part in the business or control of the business or affairs of the Partnership;
(ii) have any voice in the management or operation of any Partnership property;
(iii) have the authority or power in their capacity as Limited Partners to act
as agent for or on behalf of the Partnership or any other Partner, to do any
act which would be binding on the Partnership or any other Partner, or to incur
any expenditures on behalf of or with respect to the Partnership, or (iv) take
any action that

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would cause the Partnership to be treated as a publicly traded partnership as
contemplated by Section 7704 of the Internal Revenue Code.

Section 7.3. Liability of Limited Partners. A Limited Partner shall
not be liable for the debts, liabilities, contracts or other obligations of the
Partnership except to the extent of any unmade or unpaid Capital Contributions
agreed to be made by such Limited Partner as set forth in Section 3.2 (which
shall be subject to reduction as provided for in Section 3.4 and referred to in
Section 3.2), any additional Capital Contributions hereafter agreed to be made
by the Limited Partners in accordance with Section 3.5 (which shall also be
subject to reduction as provided for in Section 3.4) and such Limited Partner's
share of the assets (including undistributed revenues) of the Partnership; and
in all events, a Limited Partner shall be liable and obligated to make payments
of its Capital Contributions only as and when such payments are due in
accordance with the terms of this Agreement, and the Limited Partners shall not
be required to make any loans to the Partnership.

Section 7.4. Withdrawal and Return of Capital Contribution. The
Limited Partners shall not be entitled to (a) withdraw from the Partnership
except upon the assignment by a Limited Partner of all of its interest in the
Partnership and the substitution of such Limited Partners's assignee as a
Limited Partner of the Partnership in accordance with Section 9.1, or (b) the
return of its Capital Contributions except to the extent, if any, that
distributions made pursuant to the express terms of this Agreement may be
considered as such by law or by unanimous agreement of the Partners, or upon
dissolution and liquidation of the Partnership, and then only to the extent
expressly provided for in this Agreement and as permitted by law.

Section 7.5. Power of Attorney. Each Limited Partner here by makes,
constitutes and appoints each of the General Partners and any successor General
Partners of the Partnership and their authorized officers, employees and agents
its true and lawful agent and attorney-in-fact, with full power and authority
in its name, place and stead, to make, execute, sign, acknowledge, swear to,
record and file, on behalf of such Limited Partner or of the Partnership, such
documents, instruments, conveyances and certificates as may be necessary or
appropriate to carry out the provisions and purposes of this Agreement,
including without limitation, (a) any Certificate of Limited Partnership of the
Partnership and all amendments thereto required or permitted by law or the
provisions of this Agreement, or modification of any documents, instruments or
agreements deemed appropriate to reflect the admission or substitution of
additional partners to the partnership in accordance with the provisions of
this Agreement (b) the amendment or restatement of this Agreement in accordance
with the terms hereof; (c) all certificates and other instruments deemed
advisable to permit the Partnership to qualify to do business or to protect the
limited liability of the Limited Partners of the Partnership in any
jurisdiction; (d) all conveyances and other instruments (including Certificates
of Cancellation and Certificates of Withdrawal) deemed advisable to effect the
dissolution and termination of the Partnership in accordance with the terms of
this Agreement (e) any offers to lease, Leases, assignments and requests for
approval or assignments, statements of citizenship, interest and holdings, and
any other instruments of communications now or hereafter required or permitted
to be filed on behalf of the Partnership or the several Partners of the
Partnership in their capacities as such under any law relating to the leasing
of government land (federal and state) for oil and gas exploration, development
and production;

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and (f) all other instruments and documents that may be required or permitted
by law to be filed on behalf of the Partnership. The foregoing power of
attorney is coupled with an interest, shall be irrevocable, and shall survive
and shall not be affected by the subsequent death, incompetency, incapacity,
disability, dissolution, bankruptcy, or termination of such Limited Partner and
shall extend to such Limited Partner's heirs, successors, assigns and personal
representatives.

ARTICLE VIII

Books, Records, Reports and Bank Accounts

Section 8.1. Capital Accounts, Books and Records.

(a) Except as may otherwise be required by this Agreement, the
Managing General Partner shall keep books of account for the Partnership in
accordance with generally accepted accounting principles consistently applied
utilizing the full-cost method of accounting for oil and gas exploration and
development activities in accordance with the terms of this Agreement. Such
books shall be maintained at the principal United States office of the
Partnership. The calendar year shall be selected as the accounting year of the
Partnership and the books of account shall be maintained on an accrual basis.

(b) An individual capital account shall be maintained by the
Partnership for each Partner as provided below:

(i) The capital account of each Partner shall, except as
otherwise provided herein, be (A) credited with the amount of cash and
the initial fair market value of any property contributed to the
Partnership by such Partner (net of liabilities secured by such
contributed property that the Partnership is considered to assume or
take subject to under Section 752 of the Internal Revenue Code), (B)
credited with the amount of any item of taxable income or gain and the
amount of any item of income or gain exempt from tax allocated to such
Partner for federal income tax purposes (taking into account any
reallocation pursuant to Section 3.5), (C) credited with the Partner's
share of Simulated Gain as provided in Section 8.1(b)(ii), (D) debited
by the amount of any item of deduction or loss allocated to such Partner
for federal income tax purposes (taking into account any reallocation
pursuant to Section 3.5), (E) debited with the Partner's share of
Simulated Loss and Simulated Depletion as provided in Section
8.1(b)(ii), (F) debited by such Partner's allocable share of
expenditures of the Partnership not deductible in computing the
Partnership's taxable income and not properly chargeable as capital
expenditures, including any nondeductible book amortizations of
capitalized costs, and (G) debited by the amount of cash or the fair
market value of any property distributed to such Partner (net of
liabilities secured by such distributed property that such Partner is
considered to assume or take subject to under Section 752 of the
Internal Revenue Code). Immediately prior to any distribution of
property by the Partnership that is not pursuant to a liquidation of the
Partnership (or all or any portion of a Partner's interest therein), the
Partners' capital accounts shall be adjusted by assuming that the

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distributed assets were sold by the Partnership for cash at their
respective fair market values (as determined by the General Partners) as
of the date of distribution by the Partnership, and crediting or
debiting each Partner's capital account with its respective share of the
hypothetical gains or losses, including Simulated Gains and Simulated
Losses resulting from such assumed sales in the same manner as gains or
losses on actual sales of such properties would be allocated under
Section 4.3. Notwithstanding the foregoing sentence, the Partnership
shall not distribute property in kind (except as provided in Section
9.4, 9.5 or 10.3 herein) to any Partner unless such Partner has agreed
in writing to such property distribution.

(ii) The allocation of basis prescribed by Section
613A(c)(7)(D) of the Internal Revenue Code and provided for in Section
4.3(b) and each Partner's separately computed depletion deductions shall
not reduce such Partner's capital account, but such Partner's capital
account shall be debited by an amount equal to the product of the
depletion deductions that would otherwise be allocable to the
Partnership in the absence of Section 613A(c)(7)(D) of the Internal
Revenue Code (computed without regard to any limitations with
theoretically could apply to any Partner) times such Partner's
percentage share of the fair market value of the depletable property
with respect to which such depletion is claimed (herein called
"Simulated Depletion"). The Partnership's fair market value in any
depletable property, as adjusted from time to time for Simulated
Depletion allocable to all Partners, is herein called "Simulated Basis".
Each Partner's allocable share of the Partnership's Simulated Basis,
which share shall be determined in the same manner as the allocation of
basis prescribed in Section 4.3(b), is herein called the Partner's
Simulated Basis. No Partner's capital account shall be decreased,
however, by Simulated Depletion deductions attributable to any
depletable property to the extent such deductions exceed such Partner's
remaining Simulated Basis in such property. The Partnership shall
compute simulated gain ("Simulated Gain") or simulated loss ("Simulated
Loss") attributable to the sale or other disposition of a depletable
property based on the difference between the amount realized from such
sale or other disposition and the Simulated Basis of such depletable
property, as theretofore adjusted. Any Simulated Gain shall be
allocated to the Partners and shall increase their respective capital
accounts in the same manner as the amount realized from such sale or
other disposition in excess of Simulated Basis shall have been allocated
pursuant to Section 4.3(b). Any Simulated Loss shall be allocated to
the Partners and shall reduce their respective Capital Accounts in the
same percentages as the costs of the depletable property sold were
allocated up to an amount equal to each Partner's share of the
Partnership's Simulated Basis in such depletable property at the time of
such sale.

(iii) Any adjustments of basis of Partnership property provided
for under Sections 734 and 743 of the Internal Revenue Code and
comparable provisions of state law (resulting from an election under
Section 754 of the Internal Revenue Code or comparable provisions of
state law) and any election by any Partner under Section 59(e)(4) of the
Internal Revenue Code to amortize such Partner's share of intangible
drilling and development costs shall not affect the capital accounts of
the Partners except as otherwise provided in Treas. Reg. Section
1.7041(b)(2)(iv)(m) or as required in

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the definition of fair market value, and the Partners' capital accounts
shall be debited or credited pursuant to the terms of this Section 8.1
as if no such election had been made.

(iv) It is the intention of the parties that the capital
accounts of each Partner be kept in the manner required under Treas.
Reg. Section 1.704-1(b)(2)(iv). To the extent any additional
adjustment to the capital accounts is required by such Regulation, the
Managing General Partner is hereby authorized to make such adjustment
after notice to the other Partners.

(v) In the case of property contributed to the Partnership by
a Partner, the Partners capital accounts shall be debited or credited in
accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(g) for
items of Depreciation, Simulated Depletion, and gain or loss (including
Simulated Gain and Simulated Loss) with respect to such property
computed in the same manner as such items would be computed if the
adjusted tax basis of such property were equal to its fair market value
on the date of the contribution of the property to the partnership, in
lieu of the adjustments to the capital accounts otherwise provided in
this Section 8.1(b) for such items.

(vi) Capital accounts shall be adjusted, in a manner consistent
with this Section 8.1, to reflect any adjustments in items of
Partnership income, gain, loss or deduction that result from amended
returns filed by the Partnership or pursuant to an agreement by the
Partnership with the Internal Revenue Service or a final court decision.

Section 8.2 Reports. The General Partners shall deliver to the
Limited Partners the following financial statements and reports at the times
indicated below:

(a) Quarterly within 60 days after the end of each fiscal quarter of
the Partnership and annually within 75 days after the end of each fiscal year
of the Partnership, commencing with the fiscal year ending December 31, 1995,
(i) financial statements as of the end of and for such period, including a
balance sheet and statements of income, Partners' equity, and statements of
cash flow, prepared in accordance with generally accepted accounting principles
and, if Capital Contributions of at least $3,000,000 have been paid to the
Partnership, such financials shall be audited by the Partnership's independent
certified public accountants. The independent certified public accountants for
the Partnership shall be Price Waterhouse & Co. or such other firm as shall be
designated by the Managing General Partner and approved by the RIMCO General
Partner.

(b) Annually within 60 days after the end of each fiscal year of the
Partnership, beginning with the fiscal year in which at least $3,000,000 of
aggregate Capital Contributions has been contributed to the Partnership, a
report containing (i) an estimation of the oil and gas reserves, classified by
appropriate categories, as of the end of the preceding fiscal year attributable
to the interest of the Partnership therein, (ii) a projection of the rate of
production of and net income from such reserves with respect to each such
interest, (iii) a calculation of the present worth of such net income and (iv)
a schedule or complete description of all assumptions, estimates and
projections made or used in the preparation of

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such report, including without limitation estimated future product prices,
capital expenditures, operating expenses and taxes. Each such report shall be
prepared in accordance with customary and generally accepted standards and
practices for petroleum engineers, and shall be prepared by the Consulting
Engineer. For the fiscal year ending December 31, 1994, a reserve report will
be prepared for the Partnership by Mr. Brian Wallace.

(c) Annually, by March 15, a report containing such information as
may be reasonable to enable each Partner to prepare and file its federal income
tax return.

(d) Such other reports and financial statements as the General
Partners shall reasonably determine from time to time.

The third party costs of such reporting shall be paid by the Partnership
as a Partnership expense.

Section 8.3. Information Relating to the Partnership. Each Partner and
its authorized agents and representatives, at any time during the term of the
Partnership and during ordinary business hours, shall have reasonable access to
and the right to inspect, and audit at such Partner's.expenses, all books,
records and materials in the Partnership's offices regarding the Partnership or
its activities and, at the risk of such Partner, to the drill site of each
Partnership well. Each Partner shall have a continuing right to audit at its
expense the Partnership books for a period of one year following the
liquidation of the Partnership.

ARTICLE IX

Assignments of Interests and Substitutions

Section 9.1. Assignments by Limited Partners.

(a) The interest of a Limited Partner in the Partnership shall be
assignable in whole or in part, subject to the following: (i) no such
assignment shall be made if such assignment would result in (A) the violation
of any applicable federal or state securities laws, (B) the Partnership or the
General Partners becoming subject to additional regulation or additional
fiduciary obligations, or (C) a termination of the Partnership for federal
income tax purposes, and (ii) the Partnership shall not be required to
recognize any such assignment until the instrument conveying such interest has
been delivered to the Managing General Partner for recordation on the books of
the Partnership. If a Limited Partner assigns its interest in the Partnership
pursuant to this Section 9.1(a), it shall notify the General Partners of such
assignment at least five (5) days prior to the effective date of such
assignment. If a Limited Partner assigns its interest in the Partnership in
violation of any provision of this Section 9.1(a), it shall indemnify and save
harmless the General Partners from any costs, expenses, losses or damages
(including without limitation attorneys' fees and expenses) which the General
Partners may incur as a result of such violation. The Limited Partners
recognize that their interests in the Partnership have not been registered
under the Securities Act of 1933, as amended, or any state securities laws;
and, therefore, such Limited Partners may

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not transfer or assign their interests in the Partnership unless such interests
are registered under such acts or an exemption from registration under such
acts is available.

(b) Unless an assignee becomes a substituted Limited Partner in
accordance with the provisions set forth below, such assignee shall not be
entitled to any of the rights granted to a Limited Partner hereunder, other
than the right to receive allocations of income, gain, loss, deduction, credit
and similar items and distributions to which the assignor would otherwise be
entitled, to the extent such items are assigned.

(c) An assignee of the interest of a Limited Partner, or any portion
thereof, shall become a substituted Limited Partner entitled to all of the
rights of a Limited Partner if, and only if (i) the assignor gives the assignee
such right, (ii) the General Partners consent to such substitution, the
granting or denying of which shall be in each General Partner's sole and
absolute discretion; provided that with respect to an assignee of a Limited
Partner that is controlling, controlled by or under common control with a
General Partner, the General Partners hereby consent in advance to substitution
of such an assignee as a Limited Partner of the Partnership, and (iii) the
assignee executes and delivers such instruments, in form and substance
reasonably satisfactory to the Managing General Partner, as the Managing
General Partner may deem necessary or desirable to effect such substitution and
to confirm the agreement of the assignee to be bound by all of the terms and
provisions of this Agreement. Upon the satisfaction of such requirements, the
Managing General Partner shall concurrently (or as of such later date as shall
be provided for in any applicable written instruments furnished to the Managing
General Partner) admit any such assignee as a substituted Limited Partner of
the Partnership and reflect such admission and the date thereof in the records
of the Partnership.

(d) The Partnership and the General Partners shall be entitled to
treat the record owner of any Partnership interest as the absolute owner
thereof in all respects and shall incur no liability for distributions of cash
or other property made in good faith to such owner until such time as a written
assignment of such interest that complies with the terms of this Agreement has
been received by the General Partners.

Section 9.2. Assignment by General Partners. No General Partner shall
assign its interest in the Partnership, in whole or in part, without the prior
written consent of the other General Partner and the Limited Partners, the
granting or denying of which shall be in each such Partner's sole and absolute
discretion. A General Partner shall be permitted to pledge or grant a security
interest in its right to receive cash distributions from the Partnership to
secure the payment of indebtedness so long as (a) all payments of principal and
interest and all other charges relating to such indebtedness are separately
made by such General Partner and not by the Partnership or with Partnership
funds and (b) no Partnership properties are pledged, subjected to a security
interest or otherwise encumbered to secure such indebtedness. Notwithstanding
the foregoing, either General Partner shall have the right to assign its
interest as a General Partner in whole or in part to an Affiliate of such
General Partner provided that such Affiliate agrees to assume all of the
obligations with respect to such interest in the Partnership, and provided
further that after such assignment, the General Partners collectively have
substantial net worth for tax purposes as supported by an opinion of legal
counsel in form and substance acceptable to the Partnership.

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Section 9.3. Merger or Consolidation. Notwithstanding the provisions
of Section 9.2, the merger or consolidation by a Partner with another
corporation or other entity pursuant to which such Partner is the surviving
entity shall not be considered an assignment of an interest in the Partnership,
and upon the merger or consolidation of such Partner, the resulting entity
shall continue as a Partner.

Section 9.4. Withdrawal of Managing General Partner's Interest in
Partnership Properties.

(a) Notwithstanding the provisions of Section 9.2, in the event of an
initial public offering of the securities of any Brigham Affiliate, the
Managing General Partner shall have the right, but not the obligation, at the
time of such offering to require the Partnership to distribute to it the
Managing General Partner's share of all properties upon 30 days prior written
notice of such required distribution. In the event of such a distribution,
RIMCO shall have corresponding right to require the Partnership to distribute
to it at the same time a proportionate share of its interest in such
properties, not to exceed a fifty percent (50%) interest in all Partnership
properties. Each Partner receiving such a distribution shall reimburse the
Partnership for its proportionate share of all costs reasonably attributable to
such distribution and shall indemnify the Partnership and the other Partners
for all costs and expenses relating to such distributed property from and after
the effective assignment date thereof.

(b) In the event the Partnership continues in existence after the
withdrawal of properties by the Managing General Partner, the Managing General
Partner shall retain all post-Payout rights in its share of the Partnership
properties and assets and the Partnership will assign to the Managing General
Partner additional interests in the Partnership properties and assets in
accordance with the Payout terms and in the post-Payout percentages as reached.

(c) Solely in the event that Brigham elects to withdraw its share of
the Partnership assets pursuant to Section 9.4(a) and include such assets in
the initial public offering of securities of a Brigham Affiliate (an "IPO"),
and subject to the provisions of this Section 9.4, RIMCO shall have a
corresponding right to include its share of the Partnership assets in such IPO.
The right of RIMCO to participate in an IPO and the amount of assets to be
included may be reduced or eliminated if in the opinion of t e managing
underwriter, the inclusion of such assets or the other participation of RIMCO
in the IPO would negatively impact the proposed offering. If RIMCO elects to
participate in an IPO, it must do so subject to all the terms agreed upon
between the Brigham Affiliate and the underwriters. Such terms include without
limitation the amount of Partnership assets to be included, the form of
consideration to be received by RIMCO (cash, stock, a combination thereof or
other consideration), the amount of equity interest that RIMCO may hold on
conclusion of the IPO, resale restrictions, expense sharing and
indemnifications.

(d) All assets withdrawn from the Partnership (or otherwise included
in the IPO) ,by both Brigham and RIMCO shall be valued on the same basis, and
Payout 1 and Payout 2 shall be calculated as if RIMCO had received cash value
for its share of the Partnership assets at the time of the IPO. If necessary
based on this calculation, the percentage interests

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of Brigham and RIMCO in the Partnership assets shall be adjusted prior to their
inclusion in the IPO. In addition, RIMCO will be credited with an incremental
value, proportionately reduced, of any incremental value received by Brigham in
such amount as proposed by Brigham and approved by the managing underwriter of
the IPO.

(e) In the event that the Partnership continues in existence after
withdrawal by Brigham of its share of Partnership assets pursuant to Section
9.4(a) above, Brigham shall continue to serve as the Managing General Partner
of the Partnership until the earlier to occur of (i) the achievement of Payout
2, in which event the Partnership shall be dissolved, or (ii) 12 months
following the effective date of the IPO, in which event Brigham shall have the
option to continue to act as the Managing General Partner of the Partnership or
withdraw from the Partnership by delivering to RIMCO an indemnification for
Brigham's actions as Managing General Partner for the time it acted in such
capacity. Under any such indemnification, the Managing General Partner shall
indemnify RIMCO and its officers, directors and partners, as applicable,
harmless from and against all loss, cost, expense and claims they may incur to
the extent provided in Section 7.03 of the Texas Revised Partnership Act. In
either event, Brigham shall receive the assignments referenced in Section
9.4(b) above of the post-Payout interests in Partnership assets.

(f) Immediately prior to any distribution under this Section 9.4 that
is in part or complete redemption of either General Partner's interest in the
Partnership, the capital accounts of the Partners shall be adjusted in the
manner provided in Section 10.3(b). Notwithstanding any provision in this
Section 9.4 to the contrary, the value of any distributions to a Partner under
this Section 9.4 shall not exceed such Partner's capital account as so
adjusted.

Section 9.5. Withdrawal of RIMCO's Interest in Partnership Properties.

(a) Notwithstanding the provisions of Section 9.2, in the event of an
initial public offering of the securities of RIMCO or an Affiliate of RIMCO
whereby the asset valuation for such offering involves the valuation of
primarily oil and gas reserves, RIMCO shall have the right, but not the
obligation, at the time of such offering to require the Partnership to
distribute to it up to 50% of RIMCO's share of any properties or portion
thereof upon 30 days prior written notice of such required distribution. In
the event of such a distribution, Brigham shall have a corresponding right to
require the Partnership to distribute to it at the same time a portion of its
share of such properties equal to the percentage interest distributed to RIMCO.
Each Partner receiving such a distribution shall reimburse the Partnership for
its proportionate share of all costs reasonably attributable to such
distribution and shall indemnify the Partnership and the other Partners for all
costs and expenses relating to such distributed property from and after the
effective assignment date thereof.

(b) In the event that RIMCO elects to withdraw any of its interest in
Partnership properties pursuant to this Section 9.5, at the sole election of
Brigham (1) the assets withdrawn shall be valued on the same basis as other oil
and gas assets are valued in such offering, and Payout 1 and Payout 2 shall be
calculated as if the parties withdrawing assets had received cash for their
respective shares of the Partnership assets withdrawn at the time of such
offering, with appropriate adjustments to be made to the percentage interests
of

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<PAGE> 39
RIMCO and Brigham in the Partnership assets prior to their inclusion in the
offering, or (2) Brigham shall retain all post-Payout rights in its share, as
Managing General Partner, of the Partnership properties and assets as if no
assets had been withdrawn, and RIMCO will (A) grant and assign to Brigham a
back-in interest in any assets and properties withdrawn to be measured by the
Payout terms computed as if the withdrawal of assets had not occurred, which
back-in interest shall run with the land and be filed in the appropriate deed
records at RIMCO's expense and (B) grant to Brigham a contractual right to
approve or disapprove any sale or other transfer or encumbrance of such assets
and properties by RIMCO or any successor entity, which approval rights shall be
in the sole discretion of Brigham.

(c) Immediately prior to any distribution under this Section 9.5 that
is in part or complete redemption of either General Partner's interest in the
Partnership, the capital accounts of the Partners shall be adjusted in the
manner provided in Section 10.3(b). Notwithstanding any provision in this
Section 9.5 to the contrary, the value of any distributions to a Partner under
this Section 9.5 shall not exceed such Partner's capital account as so
adjusted.

Section 9.6. Purchase of Certain Leases. In the event that the General
Partners fail to reach agreement with respect to operations proposed by one
General Partner for any Partnership Lease(s), then the General Partner which
proposes such operations shall have the right to acquire the Partnership's
interest in (a) with respect to a Lease having no Proved Reserves, the Lease(s)
for which such operations are proposed, and (b) with respect to a Lease as to
which Proved Reserves are attributable, the spacing unit for the well as to
which operations are proposed; and shall pay the Partnership therefor the sum
of all Acquisition Costs and Capital Costs expended by the Partnership with
respect to such Lease(s) or spacing unit, as applicable, except that if there
are Proved Reserves attributable to the spacing unit for the well as to which
operations are proposed, the payment to the Partnership shall instead be the
fair market value of such spacing unit as determined by the independent
petroleum engineer who prepared, and based on, the most recent annual reserve
report prepared for the Partnership, and if calculated prior to receipt of the
first annual reserve report, based on an independent reserve report prepared by
Cawley & Gillespie. After the General Partners have failed to agree on
proposed operations, the General Partner which elects to purchase any
Partnership Lease(s) pursuant to this Section 9.6 shall notify the other
General Partner in writing of such intention to purchase (and shall identify
the particular Leases or spacing units for which the operations were proposed,
which Leases or spacing units shall be subject to the election to purchase).

ARTICLE X

Dissolution, Liquidation and Termination

Section 10.1. Dissolution. The Partnership shall be dissolved upon the
occurrence of any of the following:

(a) The occurrence of December 31, 2004.

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<PAGE> 40
(b) The consent in writing of the General Partners.

(d) The occurrence of an event of withdrawal from the Partnership by
a General Partner (except as a consequence of merger or consolidation) as
provided for in Section 4.02(a) of the Act.

(e) The election of the Managing General Partner if at such time the
Managing General Partner has determined that it has become uneconomic for the
Partnership to continue its business.

(f) The occurrence of any event which under the Act causes the
dissolution of a limited partnership.

Section 10.2. Withdrawal by General Partners and Reconstitution. In the
event of a dissolution of the Partnership as a result of the occurrence of an
event under Section 10.1(d) or (e) or in the event of a voluntary withdrawal by
a General Partner, the remaining Partners shall be entitled to reconstitute and
continue the business of the Partnership and if there are no remaining General
Partners, to elect and substitute a new General Partner.

Section 10.3. Liquidation and Termination. Upon dissolution of the
Partnership, the General Partners shall appoint one or more liquidators who
shall have full authority to wind up the affairs of the Partnership and make
final distribution as provided herein; provided, however, that if the General
Partners fail to agree upon a liquidator, each General Partner shall select a
person to determine the liquidator and those persons shall select a third
person to act as liquidator; and provided further that if one of the events
specified in Section 10.1(d) has occurred as a result of an act by a General
Partner, the liquidator shall be a person selected in writing by the other
General Partner. The liquidator shall continue to operate the Partnership
properties with all of the power and authority of the Managing General Partner.
The steps to be accomplished by the liquidator are as follows:

(a) As promptly as possible after dissolution and again after final
liquidation, the liquidator shall cause a proper accounting to be made of the
Partnership's assets, liabilities and operations through the last day of the
month in which the dissolution occurs or the final liquidation is completed, as
appropriate.

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<PAGE> 41
crediting each Partner's capital account with its respective share of the
hypothetical gains or losses (including Simulated Gains and Simulated Losses)
resulting from such assumed sales in the same manner as actual sales of such
properties are allocated under Section 4.3. The liquidator shall then by
payment of cash or property (valued as of the date of termination of the
Partnership at its fair market value by the appraiser) distribute to the
Partners such amounts as are required to pay the positive balances of their
respective capital accounts. Such distribution shall be pro rata in kind or in
cash as determined by the liquidator. If the amount of cash or property
remaining after the payment or provision for the debts and liabilities of the
Partnership is not sufficient to pay an amount equal to the positive balances
of the Partners' capital accounts, the remaining cash and property shall be
distributed among the Partners in proportion to the positive balances of their
respective capital accounts. Any distribution to the Partners in liquidation
of the Partnership shall be made by the later of the end of the taxable year in
which the liquidation occurs or 90 days after the date of such liquidation.
For purposes of the preceding sentence, the term "liquidation" shall have the
same meaning as set forth in Treasury Regulation Section 1.704-l(b)(2)(ii) as
in effect at such time. Each Partner shall have the right to designate another
person to receive any property which otherwise would be distributed in kind to
that Partner pursuant to this Section 10.3.

(c) Any Leases distributed to the Partners shall be subject to the
operating agreements then in effect with respect to such Leases; provided,
however, that if any of such Leases are not subject to an operating agreement
to which an unaffiliated third person is a party, such Leases shall be subject
to a standard form operating agreement (with an accounting procedure) as shall
be agreed upon by the General Partners. Upon written request made by any
Partner, the liquidator shall sell the Leases and other properties and assets
that otherwise would be distributable to such Partner under this Section 10.3
at the best cash price available therefor and distribute such cash (after
deducting all expenses reasonably relating to such sale) to such Partner. Any
gain or loss attributable to the sale shall be allocated to such Partner.

(d) Except as expressly provided herein, the liquidator shall comply
with any applicable requirements of the Act and all other applicable laws
pertaining to the winding up of the affairs of the Partnership and the final
distribution of its assets.

The distribution of cash and/or property to the Partners in accordance
with the provisions of this Section 10.3 shall constitute a complete return to
the Partners of their Capital Contributions and a complete distribution to the
Partners of their interests in the Partnership and all Partnership property.
No Partner with a negative balance in its capital account shall be liable to
the Partnership or any other Partner for the amount of such negative balance
upon dissolution and liquidation.

Section 10.4. Cancellation of Certificate. Upon the completion of the
distribution of Partnership assets as provided herein, the Partnership shall be
terminated, and the liquidator (or the Partners if necessary) shall cause the
cancellation of the certificate of limited partnership of the Partnership and
shall take such other actions as may be necessary to terminate the Partnership.

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<PAGE> 42
ARTICLE XI

Representations and Warranties

Section 11.1. Representations and Warranties of Partners. Each Partner
hereby represents, warrants and covenants as follows:

(a) Such Partner has the right, power and authority to enter into
this Agreement, to become a Partner and to perform its obligations under this
Agreement, and this Agreement is the legal, valid and binding obligation of
such Partner.

(b) The execution and delivery of this Agreement does not violate or
conflict with the charter, bylaws, partnership agreement or other governing
documents of such Partner or any agreement, judgment, license, permit, order or
other document applicable to or binding upon such Partner or any of its
properties, and no consent, approval, authorization or order of any court or
governmental authority or third party is required that has not been obtained
with respect to such Partner in connection with the execution and delivery of
this Agreement.

(c) Except for a change of law over which the affected Partner has no
control (and the affected Partner shall immediately notify the other Partners
when the affected Partner learns of such occurrence), the foregoing
representations, warranties and covenants shall remain true and accurate during
the term of the Partnership, and such Partner will neither take action nor
permit action to be taken which would cause any of the foregoing
representations to become untrue or inaccurate.

(d) No Partner or any of its Affiliates has employed or retained any
broker, agent or finder in connection with the Partnership Agreement or the
transactions contemplated herein, or paid or agreed to pay any brokerage fee,
finder's fee, commission or similar payment to any person on account of this
Agreement or the transactions provided for herein; and each Partner shall
indemnify and hold harmless each other Partner from any costs, including
attorneys' fees, and liability arising from the claim of any broker, agent or
finder employed or retained by such Partner.

(e) Such Partner and its Affiliates and persons acting on their
behalf have not taker) any action, or failed to take any action, which has
caused the organization of the Partnership and the issuance of the interests in
the Partnership to come within the registration requirements of the Securities
Act of 1933, as amended, or any applicable state blue sky laws.

(f) Such Partner is eligible to acquire and hold federal oil and gas
Leases.

Section 11.2. Additional Representations and Warranties of Limited
Partners. Each Limited Partner represents, warrants and covenants to the
General Partners that it is (a) an "accredited investor" as defined in
Regulation 501 promulgated under the Securities Act of 1933, as amended, and
(b) acquiring its interest in the Partnership as an investment and not with a
view to the resale or other distribution thereof to the public. Each Limited
Partner further agrees that it will use its reasonable best efforts to comply
with such laws, rules,

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<PAGE> 43
regulations and procedures as shall be applicable to it, including the
execution of all instruments and documents reasonably required, to enable the
Partnership to acquire Leases in accordance herewith.

Section 11.3. Survival of Representations and Warranties. All
representations, warranties and covenants made by the Partner in this Agreement
or any other document contemplated hereby shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of this Agreement, or such other document, regardless of any
investigation made by or on behalf of any such party.

ARTICLE XII

Miscellaneous

Section 12.1. Notices. All notices, elections, demands or other
communications required or permitted to be made or given pursuant to this
Agreement shall be in writing and shall be considered as properly given or made
if given by (a) personal delivery, (b) expedited delivery service with proof of
delivery, or (c) prepaid telegram, telecopy or similar means (provided that
such telegram or similar communication is confirmed by expedited delivery
service in the manner previously described), addressed to the respective
addressee(s) specified in Section 1.5. A Limited Partner may change its
address by giving notice in writing to the General Partners of its new address,
and the General Partners may change their addresses by giving notice in writing
to the Limited Partners of such new addresses.

Section 12.2. Amendments. This Agreement may be changed, modified, or
amended only by the affirmative vote or written consent of all Partners.

Section 12.3. Partition. Each of the Partners hereby irrevocably waives
for the term of the Partnership any right that such Partner may have to
maintain any action for partition with respect to the Partnership property.

Section 12.4. Entire Agreement. This Agreement and the other documents
contemplated hereunder constitute the full and complete agreement of the
parties hereto with respect to the subject matter hereof.

Section 12.5. No Waiver. The failure of any Partner to insist upon
strict performance of a covenant hereunder or of any obligation hereunder,
irrespective of the length of time for which such failure continues, shall not
be a waiver of such Partner's right to demand strict compliance in the future.
No consent or waiver, express or implied, to or of any breach or default in the
performance of any obligation hereunder shall constitute a consent or waiver to
or of any other breach or default in the performance of the same or any other
obligation hereunder.

SECTION 12.6. APPLICABLE LAW AND VENUE. EXCEPT TO THE EXTENT
MANDATORILY GOVERNED BY THE LAWS OF ANOTHER STATE, THIS AGREEMENT AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES

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<PAGE> 44
HEREUNDER SHALL BE GOVERNED BY AND INTERPRETED, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS. EACH OF THE PARTNERS AGREES TO
SUBMIT, AND HEREBY WAIVES ANY OBJECTION, TO THE JURISDICTION OF THE COURTS OF
THE STATE OF TEXAS AND OF THE UNITED STATES OF AMERICA LOCATED IN HARRIS
COUNTY, TEXAS, FOR ANY ACTIONS, SUITS OR PROCEEDINGS ARISING OUT OF OR RELATING
TO THIS AGREEMENT AND HEREBY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY
SUCH COURT THAT ANY SUCH ACTION, SUIT OR PROCEEDING BROUGHT IN ANY SUCH COURT
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

Section 12.7. Successors and Assigns. Except as otherwise provided
herein, this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.

Section 12.8. Severability. If any of the provisions of this Agreement
shall be held invalid or void, such provisions shall be reformed to the extent
necessary to be held valid and the same shall not affect the validity of the
remaining provisions of this Agreement.

Section 12.9. Jury Trial Waived. The Partners hereby waive trial by
jury in any action, proceeding or counterclaim, whether at law or at equity,
brought by any of them in connection with this Agreement.

Section 12.10. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of which shall
constitute but one and the same instrument.

Section 12.11. No Third Party Beneficiaries. Except as otherwise
expressly provided herein, nothing in this Agreement is intended to confer on
any person other than the parties hereto and their respective successors or
permitted assigns, any rights, remedies, obligations or liabilities under or by
reason of this Agreement.

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<PAGE> 45
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

QUEST RESOURCES, L.L.C.

By: /s/ Ben M. Brigham
------------------------------------------
Ben M. Brigham, Manager

Agreement of Limited Partnership dated September 23, 1994, providing for the
formation of Venture Acquisitions, L.P.

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<PAGE> 46
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

RIMCO ENERGY, INC.

By: /s/ Gary J. Milavec
------------------------------------------
Gary J. Milavec, Vice President

Agreement of Limited Partnership dated September 23, 1994, providing for the
formation of Venture Acquisitions, L.P.

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<PAGE> 47
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

RIMCO PRODUCTION COMPANY, INC.

By: /s/ A. L. Jordan
------------------------------------------
A. L. Jordan, Vice President

Agreement of Limited Partnership dated September 23, 1994, providing for the
formation of Venture Acquisitions, L.P.

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<PAGE> 48
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

RIMCO EXPLORATION PARTNERS, L.P. I

By: RIMCO Holdings Corporation,
General Partner

By: /s/ A. L. Jordan
-------------------------------------
A. L. Jordan, Vice President

Agreement of Limited Partnership dated September 23, 1994, providing for the
formation of Venture Acquisitions, L.P.

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<PAGE> 49
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

RIMCO EXPLORATION PARTNERS, L.P. II

By: RIMCO Holdings Corporation,
General Partner

By: /s/ A. L. Jordan
-------------------------------------
A. L. Jordan, President

Agreement of Limited Partnership dated September 23, 1994, providing for the
formation of Venture Acquisitions, L.P.

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<PAGE> 50
Brigham Oil & Gas, L.P. hereby executes this Agreement for the sole
purpose of making the agreement as to BOG contained in Section 5.4.

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
General Partner

By: /s/ Ben M. Brigham
------------------------------------------
Ben M. Brigham, President

Agreement of Limited Partnership dated September 23, 1994, providing for the
formation of Venture Acquisitions, L.P.

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<PAGE> 1
EXHIBIT 10.3

REGULATIONS

QUEST RESOURCES, L.L.C.

ARTICLE I

FORMATION OF LIMITED LIABILITY COMPANY

Section 1.1 Formation. Quest Resources, L.L.C. (the "Company")
was formed as a limited liability company under the laws of the State of Texas
on September, 23, 1994 by filing with the Secretary of State of Texas the
Articles of Organization.

Section 1.2 Purposes. Other than with the unanimous consent of
the Members, the Company shall engage only in the following activities: acting
as general partner of B-R Acquisitions L.P. (the "Partnership") and, in
connection therewith, the acquisition, holding, maintenance, renewal,
exploration, drilling, development and operation of any Lease, (being defined
as "any option (including without limitation, any option to secure a Lease
and/or to conduct seismic or other geophysical activities), mineral interest,
royalty or overriding royalty, fee right, license, concession or other right
covering oil, gas and related hydrocarbons (or a contractual right to acquire
such an interest) or an undivided interest therein or portion thereof, together
with all pipelines, wells, equipment and other personal property and/or
fixtures associated therewith and all appurtenances thereto and servitudes
associated therewith"); the production, collection, storage, treatment,
delivery, marketing, sale or other disposition of oil, gas and related
hydrocarbons, minerals and other products from Leases; the farmout, sale,
abandonment or other disposition of Leases and assets; and the taking of all
such other actions incidental to any of the foregoing.

Section 1.3 Offices. The principal place of business of the
Company shall be 5949 Sherry Lane, Suite 1616, Dallas, Texas 75225, or such
other principal place of business as the Manager(s) may from time to time
determine. The Company may have, in addition to such office, such other
offices and places of business at such locations, both within and without the
State of Texas, as the Manager(s) may from time to time determine or the
business and affairs of the Company may require.

ARTICLE II

MEMBERS AND MEMBERSHIP INTERESTS

Section 2.1 Members and Membership Interests. The Members of the
Company and their respective membership interests are as follows:

Brigham Exploration Company ("BEC") 0.55%

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<PAGE> 2
General Atlantic Partners III, L.P. ("GAP") 0.45%

Brigham Oil & Gas, L.P. ("BOG") 99.0%

Section 2.2 Initial Contributions.

(a) The Members shall contribute in cash to the Company the
following maximum amounts in accordance with the provisions of subsection (b)
below:

<TABLE>
<S> <C>
BEC $ 1,512.50

GAP $ 1,237.50

BOG $272,250.00
</TABLE>

Such amounts shall be the maximum contributions to the Company unless the
Members otherwise agree to contribute additional amounts to the Company.

(b) Each Member shall pay its Capital Contributions to the Company
at such times and in the manner specified by the Manager(s). In the event any
Member fails or refuses to make when due its share of the Capital
Contributions, the Manager(s) shall have the right to pursue any remedy
existing at law or in equity for the collection of the unpaid amount of the
Capital Contribution agreed to be made in this Section 2.2, including without
limitation the prosecution of a suit against a defaulting Member.

Section 2.3 No Preemptive Rights. No Member shall have any
preemptive, preferential or other right with respect to: (a) additional Capital
Contributions; (b) the issuance or sale of membership interests, whether
unissued or held in the treasury; (c) the issuance of any obligations,
evidences of indebtedness or other securities of the Company convertible into
or exchangeable for, or carrying or accompanied by any rights to receive,
purchase or subscribe to, any such unissued membership interests held in the
treasury; (d) the issuance of any right of, subscription to or right to
receive, or any warrant or option for the purchase of, any of the foregoing
securities; or (e) the issuance or sale of any other securities that may be
issued or sold by the Company.

Section 2.4 Return of Contributions. No interest shall accrue on
any Capital Contributions and no Member shall have the right to withdraw or to
be repaid any capital contributed by such Member except as otherwise
specifically provided in these Regulations.

Section 2.5 Allocation of ProfIts and Losses.

(a) Except as provided in subsection (b) and (c) of this Section
2.5, all Profits and Losses of the Company shall be allocated and charged to
the Members as follows:

BEC 0.55%

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<PAGE> 3
GAP 0.45%

BOG 99.0%

(b) Notwithstanding the foregoing provisions of this Section 2.5
to the contrary:

(i) Any Member Nonrecourse Deductions for any fiscal year
of the Company shall be allocated to the Member bearing the economic
risk of loss for the Member Nonrecourse Debt to which such Member
Nonrecourse Deductions are attributable to the extent and in the
manner required under applicable Treasury Regulations.

(ii) If for any fiscal year of the Company there is a net
decrease in Minimum Gain attributable to Company Nonrecourse
Liabilities, each Member shall be allocated items of Company income
and gain for such year equal to such Member's share of such net
decrease to the extent and in the manner required under applicable
Treasury Regulations.

(iii) If for any fiscal year of the Company there is a net
decrease in Minimum Gain attributable to a Member Nonrecourse Debt,
each member shall be allocated items of Company income and gain for
such year equal to such Member's share of such net decrease to the
extent and in the manner required under applicable Treasury
Regulations.

(iv) If a Member unexpectedly receives any adjustments,
allocations or distributions described in Treasury Regulation sections
1.704-1(b)(2)(ii)(d)(4)-(6) that cause or increase a deficit balance
in such Member's Adjusted Capital Account, after taking into account
the foregoing provisions of this subsection (b), items of Company
income and gain shall be specially allocated to such Member in an
amount and manner sufficient to eliminate such deficit balance as
quickly as possible.

(c) In the case of any property contributed to the Company by any
Member which at the time of contribution has an adjusted tax basis which
differs from its fair market value, items of income, gain, loss and deduction
for income tax purposes shall be allocated as required under Section 704(c) of
the Internal Revenue Code to take account of such difference.

Section 2.6 Distributions. The Manager(s) may distribute funds
of the Company to the Members at such times and in such amounts as the
Manager(s), in their sole discretion, determine to be appropriate. Without
limiting the generality of the foregoing, the Manager(s) shall have complete
discretion to retain funds within the Company for future Company projects and
expenditures or for any other reason whatsoever. Any such distribution shall
be made in the same proportion as the Profits related to such distribution were
allocated pursuant to Section 2.5.

Section 2.7 Limitations on Members. Other than as specifically
provided for in these Regulations, no Member shall: (a) be permitted to take
part in the business or control of the business or affairs of the Company; (b)
have any voice in the management or operation of any

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<PAGE> 4
Company property; or (c) have the authority or power to act as agent for or on
behalf of the Company or any other Member, to do any act which would be binding
on the Company or any other Member, or to incur any expenditures on behalf of
or with respect to the Company.

Section 2.8 Liability of Member. No Member shall be liable to
the Company or to any other Member for the debts, liabilities, contracts or
other obligations of the Company, including, without limitation, any obligation
of the Company to any other Member, except to the extent of any unpaid Capital
Contributions it has agreed to make to the Company and its share of the assets
(including undistributed revenues) of the Company; and in all events, a Member
shall be liable and obligated to make payments of its Capital Contributions
only as and when such payments are due in accordance with the terms of these
Regulations, and no Member shall be required to make any loans to the Company.
The Company shall indemnify and hold harmless a Member in the event a Member
(a) becomes liable for any debt, liability, contract or other obligation of the
Company except to the extent expressly provided in the preceding sentence
and/or (b) is directly or indirectly required to make any payments with respect
thereto.

Section 2.9 Withdrawal and Return of Capital Contribution. No
Member shall be entitled to (a) withdraw from the Company except upon the
assignment by it of all of its interest in the Company and the substitution of
such Member's assignee as a Member of the Company in accordance with Article
VIII hereof, or (b) the return of its Capital Contributions except to the
extent, if any, that distributions made pursuant to the express terms of these
Regulations may be considered as such by law or by unanimous agreement of the
Members, or upon dissolution and liquidation of the Company, and then only to
the extent expressly provided for in these Regulations and as permitted by law.

ARTICLE III

MEETINGS OF MEMBERS

Section 3.1 Meetings. Meetings of the Members, for any purpose
or purposes, unless otherwise prescribed by statute, the Articles of
Organization or these Regulations, may be called by the Manager(s) or by the
holders of at least two-thirds of the membership interests entitled to vote at
the proposed meeting. Only business within the purpose or purposes described
in the notice of meeting of Members may be conducted at the meeting.

Section 3.2 Place of Meetings. Meetings of Members shall be held
at such places, within or without the State of Texas, as may from time to time
be fixed by the Manager(s) or as shall be specified or fixed in the respective
notices or waivers of notice thereof.

Section 3.3 Notice of Meetings. Written or printed notice
stating the place, day and hour of each meeting of the Members and the purpose
or purposes for which the meeting is called, shall be delivered not less than
ten (10) nor more than sixty (60) days before the date of the meeting, either
personally or by mail, telegram or telefax or similar communication, by or at
the direction of the person(s) calling the meeting, to each Member entitled to
vote at the meeting.

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<PAGE> 5
Section 3.4 Quorum of Members. The holders of at least
two-thirds of the membership interests, present in person or represented by
proxy, shall be requisite to and shall constitute a quorum at each meeting of
Members for the transaction of business, except as otherwise provided by
statute, the Articles of Organization or these Regulations. Unless otherwise
provided in the Articles of Organization or these Regulations, the Members
represented in person or by proxy at a meeting of Members at which a quorum is
not present may adjourn the meeting until such time and to such place as may be
determined by a vote of the holders of a majority of the membership interests
represented in person or by proxy at that meeting. At any 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
convened.

Section 3.5 Voting by Members. At any meeting of the Members,
every Member having the right to vote shall be entitled to vote either in
person or by proxy executed in writing by such Member. With respect to any
matter, except the election of Manager(s), the affirmative vote of the holders
of at least two-thirds of the membership interests shall be the act of the
Members.

A telegram, telex, cablegram or similar transmission by the Member, or
a photographic, photostatic, facsimile or similar reproduction of a writing
executed by the Member, shall be treated as an execution in writing for
purposes of this Section 3.6. No proxy shall be valid after eleven (11) months
from the date of its execution unless otherwise provided in the proxy. Each
proxy shall be revocable unless the proxy form conspicuously states that the
proxy is irrevocable and the proxy is coupled with an interest. Each proxy
shall be delivered to the Manager(s) prior to or at the time of the meeting.

Section 3.6 Action Without a Meeting. Any action required by the
Act to be taken at any meeting of Members, or any action which may be taken at
any meeting of Members, 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 Members owning not less than the minimum
percentage of membership interests that would be necessary to take such action
at a meeting at which all Members were present and voted. A telegram, telex,
cablegram or similar transmission by a Member, or a photographic, photostatic,
facsimile or similar reproduction of a writing signed by a Member, shall be
regarded as signed by the Member for purposes of this Section 3.6. If an
action is taken by the written consent of less than all of the Members, then
prompt notice of the taking of such action shall be given to the Members who
have not consented in writing to the taking of the action.

Section 3.7 Telephone Meetings. Subject to the provisions of
applicable law and these Regulations regarding notice of meetings, Members may,
unless otherwise restricted by the Articles of Organization or these
Regulations, participate in and hold a meeting by using conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and participation in a meeting pursuant to
this Section 3.7 shall constitute presence in person at such meeting, except
when a person participates in the meeting for the express purpose of objecting
to the transaction of any business on the ground that the meeting was not
lawfully called or convened.

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ARTICLE IV

MANAGEMENT

Section 4.1 Management of the Company. Except to the extent
otherwise provided for herein, the powers of the Company shall be exercised by
and under the authority of, and the business and affairs of the Company shall
be managed under the direction of, the Manager(s) of the Company.

Section 4.2 Authority of Manager(s). The Manager(s) shall have
the authority or power to act as agent for or on behalf of the Company, to act
which would be binding on the Company, to incur any expenditures on behalf of
or for the Company, and to execute, deliver and perform any agreements, acts,
transactions and other matters on behalf of the Company.

Section 4.3 Number and Qualifications of Manager(s). There shall
be one Manager of the Company. The Manager need not be a Member of the Company
or a resident of the State of Texas. The number of Managers may be increased
by the unanimous vote of the Members and the person(s) elected to fill any
newly created position(s) shall be elected by a majority vote of the Members.

Section 4.4 Term of Service. A Manager shall serve until his
successor has been appointed, or until his earlier death, resignation or
removal. No decrease in the number of Manager(s) shall have the effect of
shortening the term of any incumbent Manager(s).

Section 4.5 Place of Meetings. Any meeting of Manager(s),
regular or special, may be held either within or without the State of Texas.

Section 4.6 Regular Meetings. Regular meetings of Manager(s), of
which no notice shall be necessary, shall be held at such times and places as
may be fixed from time to time by resolution adopted by the Manager(s). Except
as otherwise provided by statute, the Articles of Organization or these
Regulations, any and all business may be transacted at any regular meeting.

Section 4.7 Special Meetings. Special meetings of Manager(s) may
be called by any Manager or the President of the Company by notice to each
Manager, either personally or by mail telegram, telephone, telefax or similar
communication. The business to be transacted at, and the purpose of, any
special meeting of Manager(s) need not be specified in the notice or waiver of
notice of such meeting.

Section 4.8 Quorum of and Action by Manager(s). If more than one
Manager is serving on behalf of the Company, at all meetings of Manager(s) the
presence of a majority of the number of Manager(s) fixed by or in the manner
provided in these Regulations shall be necessary to constitute a quorum for the
transaction of business, except as otherwise provided by statute, the Articles
of Organization or these Regulations. The act of a majority of Manager(s)
present at a meeting at which a quorum is present shall be the act of
Manager(s)

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unless the act of a greater number is required by Section 4.9 below, statute,
the Articles of Organization or otherwise in these Regulations. If a quorum
shall not be present at any meeting of Manager(s), the Manager(s) present
thereat may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present. At any such
adjourned meeting any business may be transacted that might have been
transacted at the meeting as originally convened.

Section 4.9 Action Without a Meeting. Unless otherwise
restricted by the Articles of Organization or these Regulations, any action
required or permitted to be taken at any meeting of the Manager(s) may be taken
without a meeting, if all Manager(s) consent thereto in writing, and the
writing or writings are filed with the minutes of proceedings of the
Manager(s).

Section 4.10 Telephone Meetings. Subject to the provisions of
applicable law and these Regulations regarding notice of meetings, the
Manager(s) may, unless otherwise restricted by the Articles of Organization or
these Regulations, participate in and hold a meeting of Manager(s) by using
conference telephone or similar communications equipment by means of which all
persons participating in the meeting can hear each other, and participation in
a meeting pursuant to this Section shall constitute presence in person at such
meeting, except when a person participates in the meeting for the express
purpose of objecting to the transaction of any business on the ground that the
meeting was not lawfully called or convened.

Section 4.11 Interested Manager(s) and Officers: Outside
Activities. No contract or transaction between the Company and one or more of
its Members, Manager(s) or officers or between the Company and any other
corporation, partnership, association or other organization in which one or
more of its Members, Manager(s) or officers are shareholders, partners,
members, directors, managers or officers, or have a financial interest, shall
be void or voidable solely for this reason, or solely because the Member,
Manager or officer is present at or participates in the meeting of Manager(s)
which authorizes the contract or transaction, or solely because his or their
votes are counted for such purpose, if: (1) the material facts as to the
relationship or interest and as to the contract or transaction are disclosed or
are known to the Manager(s), and the Manager(s) in good faith authorize the
contract or transaction by the affirmative vote of a majority of the
disinterested Manager(s), even though the disinterested Manager(s) be less than
a quorum; or (2) the material facts as to the relationship or interest and as
to the contract or transaction are disclosed or are known to the Members
entitled to vote thereon, and the contract or transaction is specifically
approved in good faith by vote of the Members; or (3) the contract or
transaction is fair as to the Company as of the time it is authorized, approved
or ratified by the Manager(s) or the Members. Interested Manager(s) may be
counted in determining the presence of a quorum at a meeting of the Manager(s)
which authorizes the contract or transaction.

Section 4.12 Managers' Compensation. A Manager shall not receive
any compensation for his services as Manager except as provided in Article IX.
Nothing herein contained shall be constructed to preclude any Manager (or any
entity that employs a Manager) from serving the Company in any other capacity
and receiving compensation therefor.

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Section 4.13 Time Devoted to Company. Subject to the provisions
of Section 4.14, the Manager(s) shall devote such time to Company business as
they deem necessary to manage and supervise Company business and affairs in an
efficient manner; but nothing in these Regulations shall preclude the
employment of any agent, third party or Affiliate to manage or provide other
services with respect to the Company's assets or business as the Manager(s)
shall determine.

Section 4.14 Outside Activities. These Regulations shall not
preclude or limit, in any respect, the right of any Manager(s) or any Affiliate
of any Manager(s) to engage or invest, directly or indirectly, in any business
activity or venture of any nature or description, including those that may be
the same as or similar to the Company's business and in direct competition
therewith, or to invest in the same business activity or venture as those in
which the company has invested, and no Manager(s) nor any such Affiliate shall
have any obligation to offer any such business activity or venture to the
Company. Neither the Company nor any Member shall have any right in such
investments or to such other activities or ventures, and such activities or
ventures, even if the same or directly competitive with the business of the
Company, shall not be deemed wrongful or improper. The Manager(s) and any
Affiliate of the Manager(s) shall have the right to take for its own account
(individually or as trustee) or to recommend to others any investment
opportunity.

Section 4.15 Liability of Manager(s). No Manager shall be liable
for the debts, liabilities, contracts or other obligations of the Company.

ARTICLE V

OFFICERS

Section 5.1 Officers. The Manager(s) may designate one or more
individuals (who may or may not be a Manager) to serve as officers of the
Company. The Company shall have such officers as the Manager(s) may from time
to time determine, which officers may (but need not) include a President, one
or more Vice Presidents (and in case of each such Vice President, with such
descriptive title, if any, as the Manager(s) shall deem appropriate), a
Secretary, a Treasurer and a controller. Any two or more offices may be held
by the same person.

Section 5.2 Compensation. The officers shall not receive any
compensation for their services as officers except as provided in Article IX.

Section 5.3 Term of Office: Removal: Filling of Vacancies. Each
officer of the Company shall hold office until his successor is chosen and
qualified in his stead or until his earlier death, resignation, retirement,
disqualification or removal from office. Any officer designated by the
Manager(s) may be removed at any time by the Manager(s) whenever in their
judgment the best interests of the Company will be served thereby, but such
removal shall be without prejudice to the contract rights, if any, of the
person so removed. Designation of an officer shall not of itself create
contract rights. If the office of any officer becomes vacant for any reason,
the vacancy may be filled by the Manager(s).

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Section 5.4 President. Ben M. Brigham shall act as President,
who shall be the chief executive officer of the Company and, subject to the
provisions of these Regulations, shall have the power and authority to conduct
the day-to-day business and operations of the Company and shall have general
and active control of all its business. The President shall have power and
general authority to execute bonds, deeds and contracts in the name of the
Company; to cause the employment or appointment of such employees and agents of
the Company as the proper conduct of operations may require and to fix their
compensation, subject to the provisions of these Regulations; to remove or
suspend any employee or agent who shall have been employed or appointed under
his authority or under authority of an officer subordinate to him; and in
general to exercise all the powers usually appertaining to the office of
president of a corporation, except as otherwise provided by statute, the
Articles of Organization or these Regulations.

ARTICLE VI

ACCOUNTING AND TAX MATTERS; REPORTS; BANKING

Section 6.1 Books and Records. The Manager(s) shall maintain or
cause the Company to maintain books and records as required and in accordance
with Article 2.22 of the Act, and shall make or cause to be made such records
available to the Members in accordance with Article 2.22 of the Act and to the
Manager(s). All requests made by Members pursuant to Section 2.22(E) of the
Act shall be directed to the Secretary of the Company at the Company's
principal place of business. Such books shall be maintained at the principal
United States office of the Company. Except as may otherwise be required by
these Regulations, the Manager(s) shall keep books of account for the Company
in accordance with generally accepted accounting principles consistently
applied in accordance with the terms of these Regulations.

Section 6.2 Capital Accounts. A Capital Account shall be
maintained by the Company for each Member as provided below:

(a) Each Member's Capital Contributions when made shall be
credited to such Member's Capital Account. The Capital Account of each Member
shall, except as otherwise provided herein, be (A) credited with the amount of
money and the fair market value of any property contributed to the Company by
such Member (net of liabilities secured by such contributed property that the
Company is considered to assume or take subject to under Section 752 of the
Internal Revenue Code), (b) credited with the amount of any item of Profit
allocated to such Member for federal income tax purposes, (c) credited with the
Member's share of Simulated Gain as provided in Section 6.2(b) below, (d)
debited by the amount of any item of Loss allocated to such Member for federal
income tax purposes, (e) debited with the Member's share of Simulated Loss and
Simulated Depletion as provided in Section 6.2(b), (f) debited by such Member's
allocable share of expenditures of the Company not deductible in computing the
Company's taxable income and not properly chargeable as capital expenditures,
including any nondeductible book amortizations of capitalized costs, and (g)
debited by the amount of cash or the fair market value of any property
distributed to such Member (net of liabilities secured by such distributed
property that such Member is considered to assume or take subject to under
Section 752 of the Internal Revenue Code). Immediately prior to any
distribution of property

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by the Company, the Members' Capital Accounts shall be adjusted, as required by
Treas. Reg. 1.704-1(b)(2).

(b) The allocation of basis prescribed by Section 613A(c)(7)(D) of
the Internal Revenue Code and provided for in Section 2.5 and each Member's
separately computed depletion deductions shall not reduce such Member's Capital
Account, but such Member's Capital Account shall be debited by an amount equal
to the product of the depletion deductions that would otherwise be allocable to
the Company in the absence of Section 613A(c)(7)(D) of the Internal Revenue
Code (computed without regard to any limitations with theoretically could apply
to any Member) times such Member's percentage share of the fair market value of
the depletable property with respect to which such depletion is claimed (herein
called "Simulated Depletion"). The Company's fair market value in any
depletable property, as adjusted from time to time for Simulated Depletion
allocable to all Members, is herein called "Simulated Basis." Each Member's
allocable share of the Company's Simulated Basis, which share shall be
determined in the same manner as the allocation of basis prescribed in Section
2.5, is herein called the Member's Simulated Basis. No Member's Capital
Account shall be decreased, however, by Simulated Depletion deductions
attributable to any depletable property to the extent such deductions exceed
such Member's remaining Simulated Basis in such property. The Company shall
compute simulated gain ("Simulated Gain") or simulated loss ("Simulated Loss")
attributable to the sale or other disposition of a depletable property based on
the difference between the amount realized from such sale or other disposition
and the Simulated Basis of such depletable property, as theretofore adjusted.
Any Simulated Gain or Simulated Loss shall be allocated to the Members and
shall increase or decrease their respective Capital Accounts in the same manner
as Profits and Losses are allocated pursuant to Section 2.5.

(c) Any adjustments of basis of Company property provided for
under Sections 734 and 743 of the Internal Revenue Code and comparable
provisions of state law (resulting from an election under Section 754 of the
Internal Revenue Code or comparable provisions of state law) and any election
by any member under Section 59(e)(4) of the Internal Revenue code to amortize
such Member's share of intangible drilling and development costs shall not
affect the Capital Accounts of the Members except to the extent required by
Treas. Reg. Section 1.704-l(b)(2)(iv)(m), and the Members' Capital Accounts
shall be debited or credited pursuant to the terms of this Section 6.2 as if no
such election had been made.

(d) In the case of property contributed to the Company by a
Member, the Members' Capital Accounts shall be debited and credited for items
of depreciation, Simulated Depletion, cost recovery, amortization and gain or
loss (including Simulated Gain and Simulated Loss) with respect to such
property computed in the same manner as such items would be computed if the
adjusted tax basis of such property were equal to its fair market value on the
date of its contribution to the Company, in lieu of the Capital Account
adjustments provided above for such items, all in accordance with Treas. Reg.
Section 1.704-1(b)(2)(iv)(g).

(e) It is the intention of the parties that the Capital Accounts
of each Member be kept in the manner required under Treas. Reg. Section
1.704-1(b)(2)(iv). To the extent any additional adjustment to the Capital
Accounts is required by such regulation, the Manager(s) are hereby authorized
to make such adjustment after notice to the Members.

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(f) Capital Accounts shall be adjusted, in a manner consistent
with this Section 6.2, to reflect any adjustments in items of Company income,
gain, loss or deduction that result from amended returns filed by the Company
or pursuant to an agreement by the Company with the Internal Revenue Service or
a final court decision.

Section 6.3 Tax Returns. The Manager(s) shall prepare or cause
to be prepared and timely file all federal, state and local income and other
tax returns and reports as may be required as a result of the business of the
Company.

Section 6.4 Tax Matters Person. The Members hereby shall appoint
BOG as the tax matters person ("TMP") under Section 6231 of the Internal
Revenue Code. The TMP is authorized to take such actions and to execute and
file all statements and forms on behalf of the Company which may be permitted
or required by the applicable provisions of the Internal Revenue Code or
Treasury regulations issued thereunder. The TMP shall have full and exclusive
power and authority on behalf of the Company to represent the Company (at the
Company's expense) in connection with all examinations of the Company's affairs
by tax authorities, including resulting administrative and judicial
proceedings, and to expend Company funds for professional services and costs
associated therewith. Such power and authority shall include, without
limitation, the power.and authority to extend the statute of limitations, file
a request for administrative adjustment, file suit concerning any Company tax
matter, and to enter into a settlement agreement relating to any Company tax
matter.

Section 6.5 Tax Elections. The President shall make the
following elections on behalf of the Company:

(a) To elect the fiscal year ending December 31 as the Company's
fiscal year;

(b) To elect the accrual method of accounting;

(c) To elect, in accordance with Sections 195 and 709 of the
Internal Revenue Code and applicable regulations and comparable state law
provisions, to treat all organization costs of the Company as deferred expenses
amortizable over 60 months;

(d) To elect, in accordance with Sections 734, 743 and 754 of the
Internal Revenue Code and applicable regulations and comparable state law
provisions, to adjust basis in the event any Company interest is transferred in
accordance with these Regulations or any Company property is distributed to any
Member; and

(e) To elect with respect to such other federal, state and local
tax matters as the Manager(s) shall determine from time to time.

In addition to the foregoing, the Manager(s) shall use their best efforts to
cause any partnership or tax partnership in which the Company owns or acquires
an interest to elect, in accordance with Section 754 of the Internal Revenue
Code and applicable regulations and comparable state law provisions, to cause
the basis of such Company property to be adjusted for federal income tax
purposes as provided by Sections 734 and 743 of the Internal Revenue Code.

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ARTICLE VII

DISSOLUTION, LIQUIDATION AND TERMINATION

Section 7.1 Dissolution. The Company shall be dissolved upon the
occurrence of any of the following:

(a) The expiration of eleven years from the date of filing of the
Company's Articles of Organization.

(b) The dissolution and liquidation of the Partnership.

(d) The sale of all or substantially all of the assets of the
Company.

(e) The withdrawal, bankruptcy or dissolution of a Member or the
occurrence of any other event which terminates the continued membership of a
Member in the Company, unless there is at least one remaining Member and the
business of the Company is continued by the affirmative vote of all of the
remaining Members.

(f) The occurrence of any other event which under the Act causes
the dissolution of a limited liability company.

Section 7.2 Liquidation and Termination. Upon dissolution of the
Company, the President shall act as liquidator or if he fails or refuses to
serve in such capacity, the Manager(s) shall appoint one or more liquidators
who shall have full authority to wind up the affairs of the Company and make
final distribution as provided herein. The liquidator shall continue to
operate the Company properties with all of the power and authority of the
Manager(s). The steps to be accomplished by the liquidator are as follows:

(a) As promptly as possible after dissolution and again after
final liquidation, the liquidator shall cause a proper accounting to be made of
the Company's assets, liabilities and operations through the last day of the
month in which the dissolution occurs or the final liquidation is completed, as
appropriate.

(b) The liquidator shall pay all of the debts and liabilities of
the Company (including all expenses incurred in liquidation) or otherwise make
adequate provision therefor (including without limitation the establishment of
a cash escrow fund for contingent liabilities in such amount and for such term
as the liquidator may reasonably determine). The liquidator may sell any or
all of the assets of the Company as part of winding up the affairs of the
Company. After making payment or provision for all debts and liabilities of
the Company, the Members' Capital Accounts shall then be adjusted by (i)
assuming the sale of all remaining assets of the Company for cash at their
respective fair market values (as determined by an appraiser selected by the

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liquidator) as of the date of dissolution of the Company and (ii) debiting or
crediting each Member's Capital Account with its respective share of the
hypothetical Profits or Losses resulting from such assumed sales in the same
manner as each such Capital Account would be debited or credited for Profits
and Losses on actual sales of such assets. The liquidator shall then by
payment of cash or property (valued as of the date of dissolution of the
Company at its fair market value by the appraiser selected in the manner
provided above) make distributions to the Members of the positive balances of
their respective Capital Accounts. Such distributions shall be in cash or in
kind as determined by the liquidator. Any distribution to the Members in
liquidation of the Company shall be made by the later of the end of the taxable
year in which the liquidation occurs or 90 days after the date of such
liquidation. For purposes of the preceding sentence, the term "liquidation"
shall have the same meaning as set forth in Treas. Reg. Section
1.704-1(b)(2)(ii) as in effect at such time.

(c) Except as expressly provided herein, the liquidator shall
comply with any applicable requirements of the Act, including, without
limitation Articles 6.03 through 6.08 thereof, and all other applicable laws
pertaining to the winding up of the affairs of the Company and the final
distribution of its assets.

(d) Notwithstanding any provision in these Regulations to the
contrary, no Member shall be obligated to restore a deficit balance in its
Capital Account at any time.

(e) The distribution of cash and/or property to the Members in
accordance with the provisions of this Section 7.2 shall constitute a complete
return to the Members of their Capital Contributions and a complete
distribution to the Members of their interest in the Company and all Company
property.

ARTICLE VIII

ASSIGNMENTS OF INTERESTS

A Member's interest in the Company shall not be assignable in whole or
in part without the prior written consent of all Members. Any permitted
assignee of the interest of a Member may become a substituted Member subject to
the following terms, conditions and limitations:

(i) the assignor has given the assignee the right to
become a substituted Member;

(ii) all of the Members have previously given their
written consent to the substitution of the assignee as a Member;

(iii) the assignee has paid to the Company all costs and
expenses incurred in connection with such assignee's substitution as a
Member, which costs and expenses will include without limitation all
legal and accounting fees and expenses incurred by the Company or its
counsel and all costs incurred in amending these Regulations and in

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preparing, filing, recording and publishing any certificates and
instruments necessary or appropriate in connection therewith; and

(iv) the assignee will have executed and delivered such
instruments and documents, in form and content satisfactory to the
Manager(s), as the Manager(s) may deem necessary, advisable or
appropriate to effect the substitution of such assignee as a Member.

The Company and the Manager(s) will be entitled to consider the owner of any
membership interest in the Company as set forth in the records of the Company
as the absolute owner thereof for all purposes. Neither the Company nor the
Manager(s) will incur any liability for distributions of cash or other property
made in good faith to the owner of an interest in the Company until such time
as a written assignment of such interest has been received and accepted by the
Manager(s) and recorded on the books of the Company. The Manager(s) may refuse
to accept an assignment until the end of the next succeeding quarterly or
annual accounting period. No Member shall under any circumstances sell,
convey, assign or otherwise transfer its interest in the Company to a minor or
incompetent or any other person not qualified to become a Member pursuant to
these Regulations and, in the event any such sale, conveyance, assignment or
transfer should be attempted, such will be null, void and ineffectual and will
not bind the Company or the Manager(s). In no event will any purported
transfer of a membership interest in the Company, by operation of law or
otherwise, require the Manager(s) to account to more than one person with
respect to such transferred interest. In the event of an assignment by a
Member, allocations between the assignor and assignee of deductions, credits
and income of the Company for federal, state and local income tax purposes
shall be based on the portion of the year during which the assignor and
assignee each owned such interest.

ARTICLE IX

INDEMNIFICATION

To the fullest extent permitted by applicable law now or hereafter in
effect, any person who was or is a party or is threatened to be made a party to
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that such
person is or was at any time since the inception of the Company a Manager or
officer of the Company, or, while such person is or was a Manager or officer of
the Company, is or was at any time serving another corporation, partnership,
joint venture, trust or other enterprise in any capacity at the request of the
Company, shall be indemnified by the Company against judgments, fines, amounts
paid in settlement and reasonable expenses (including attorneys' fees) actually
and necessarily incurred in connection with or as a result of such action, suit
or proceeding. Indemnification under this Section shall continue as to a
person who has ceased to be a Manager or officer of the Company and shall inure
to the benefit of the heirs, executors and administrators of such a person.

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ARTICLE X

AMENDMENTS

Subject to the requirements of the following sentence, these
Regulations may be amended or repealed, or new Regulations may be adopted, by a
majority in interest of the Members. Notwithstanding the foregoing sentence,
no provision of the Articles of Organization or these Regulations that
establishes a requirement for approval of any action by the holders of a
specified percentage of membership interests (or by all of the Members) may be
amended without the consent of the holders of the percentage of membership
interests specified in the provision to be amended (or in the case of a
provision that establishes a requirement for approval by all of the Members,
without the consent of all of the Members).

ARTICLE XI

MISCELLANEOUS

Section 11.1 Manner of Giving Notice. Whenever under the
provisions of the Act, the Articles of Organization or these Regulations,
notice is required to be given to any Member or Manager(s) of the Company, and
no provision is made as to how such notice shall be given, it shall not be
construed to mean only personal notice, but any such notice may be given in
writing by mail, postage prepaid, addressed to such Member or Manager at his
address as it appears in the records of the Company, or by telegram, telefax or
similar communication. Any notice required or permitted to be given by mail
shall be deemed to be delivered when the same shall be deposited in the United
States mail in the manner provided above. Any notice given by telegram,
telefax or similar communication shall be deemed given when transmitted.

Section 11.2 Waiver of Notice. Whenever any notice is required to
be given to any Member or Manager(s) of the Company under the provisions of the
Act, the Articles of Organization or these Regulations, a waiver thereof in
writing signed by the person or persons entitled to such notice, whether before
or after the time stated therein, shall be deemed equivalent to the giving of
such notice. Attendance of a Manager(s) at a meeting of the Manager(s) shall
constitute a waiver of notice of such meeting, except where a Manager(s)
attends a meeting for the express purpose of objecting to the transaction of
any business on the ground that the meeting is not lawfully called or convened.

Section 11.3 Defined Terms. When used in these Regulations, the
following terms shall have the respective meanings set forth below:

"Act" means the Texas Limited Liability Company Act (Tex. Rev. Civ.
Stat. Ann. art. 1528n).

"Adjusted Capital Account" shall mean the Capital Account maintained
for each Member as provided in Section 6.2 as of the end of each fiscal year
(a) increased by (i) the amount of any unpaid Capital Contributions agreed to
be contributed by such Member under Section 2.2,

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if any, (ii) an amount equal to such Member's allocable share of Minimum Gain,
as computed on the last of such fiscal year in accordance with the applicable
Treasury Regulations and (iii) the amount of Company indebtedness allocable to
such Member under Section 752 of the Internal Revenue Code with respect to
which such Member bears the economic risk of loss to the extent such
indebtedness does not constitute Member Nonrecourse Debt, and (b) reduced by
(i) the amount of all depletion deductions reasonably expected to be allocated
to such Member in subsequent years and charged to such Member's Capital Account
as provided in Section 6.2, (ii) the amount of all losses and deductions
reasonably expected to be allocated to such Member in subsequent years under
Sections 704(e)(2) and 706(d) of the Internal Revenue Code and Treasury
Regulation Section 1.751-1(b)(2)(ii), and (iii) the amount of all distributions
reasonably expected to be made to such Member to the extent they exceed
offsetting increases to such Member's Capital Account that are reasonably
expected to occur during (or prior to) the year in which such distributions are
reasonably expected to be made.

"Affiliate" shall mean, when used with respect to another person, a
person controlling, controlled by or under common control with such other
person. As used in this definition of "Affiliate-, the term "control" shall
mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a person, whether through
ownership of voting securities, by contract, or otherwise.

"Capital Account" shall mean the capital account of a Member as set
forth in Section 6.2.

"Capital Contribution" shall mean the initial contribution of a Member
as set forth in Section 2.2 and any subsequent contributions of capital made by
any Member to the Company.

"Company" shall have the meaning assigned to such term in Section 1.1
hereof.

"Company Nonrecourse Liabilities" shall mean nonrecourse liabilities
(or portions thereof) of the Company for which no Member bears the economic
risk of loss.

"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time, and any successor statute or statutes.

"Manager" shall mean the initial Manager as set forth in the Articles
of Organization of the Company and any person elected as a Manager by the
Members and serving as such in accordance with these Regulations.

"Member" shall mean any person or entity having all of the rights of a
holder of a membership interest in the Company either originally upon formation
of the Company or acquiring such interest in accordance with these Regulations.

"Member Nonrecourse Debt" shall mean any nonrecourse debt of the
Company for which any Member bears the economic risk of loss.

"Member Nonrecourse Deductions" shall mean the amount of deductions,
losses and expenses equal to the net increase during the year in Minimum Gain
attributable to a Member

-16-
<PAGE> 17
Nonrecourse Debt, reduced (but not below zero) by proceeds of such Member
Nonrecourse Debt distributed during the year to the Members who bear the
economic risk of loss for such debt, as determined in accordance with
applicable Treasury Regulations.

"Minimum Gain" shall mean (i) with respect to Company Nonrecourse
Liabilities, the amount of gain that would be realized by the Company if it
disposed of (in a taxable transaction) all Company properties that are subject
to Company Nonrecourse Liabilities in full satisfaction of Company Nonrecourse
Liabilities, computed in accordance with applicable Treasury Regulations, or
(ii) with respect to each Member Nonrecourse Debt, the amount of gain that
would be realized by the Company if it disposed of (in a taxable transaction)
the Company property that is subject to such Member Nonrecourse Debt in full
satisfaction of such Member Nonrecourse Debt, computed in accordance with
applicable Treasury Regulations.

"Partnership" shall have the meaning assigned to it in Section 1.2
hereof.

"Person" shall mean an individual, partnership, limited partnership,
limited liability Company, foreign limited liability Company, trust, estate,
corporation, custodian, trustee, executor, administrator, nominee or entity in
a representative capacity.

"Profits" and "Losses" shall mean, for each fiscal year, an amount
equal to the Company's taxable income or loss for such year or period,
determined in accordance with Internal Revenue Code Section 703(a) (for this
purpose, all items of income, gain, loss, or deduction required to be stated
separately pursuant to Internal Revenue Code Section 703(a)(1) shall be
included in taxable income or loss), with the following adjustments:

(i) any income of the Company that is exempt from federal
income tax and not otherwise taken into account in computing Profits
and Losses pursuant to this Agreement shall be added to such taxable
income or loss; and

(ii) any expenditures of the Company described in Internal
Revenue Code Section 705(a)(2)(B) or treated as Internal Revenue Code
Section 705(a)(2)(B) expenditures pursuant to Treas. Reg. Section
1.704-1(b)(2)(iv)(i), and not otherwise taken into account in
computing Profits or Losses hereunder shall be subtracted from such
taxable income or loss.

"Simulated Basis", Simulated Depletion", "Simulated Gain", and
"Simulated Loss" shall have the meanings assigned to such terms in Section 6.2.

-17-
<PAGE> 18
IN WITNESS WHEREOF, the parties have executed these Regulations of
guest Resources, L.L.C. by their duly authorized officers, as of the date first
written above.

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
General Partner

By: /s/ Ben M. Brigham
-------------------------------------
Ben M. Brigham, President

BRIGHAM EXPLORATION COMPANY

By: /s/ Ben M. Brigham
------------------------------------------
Ben M. Brigham, President

GENERAL ATLANTIC PARTNERS III, L.P.

By: GAP III Investors, Inc.,
its General Partner

By: /s/ William Ford
-------------------------------------
Name: William Ford
---------------------------
Title: Vice President
--------------------------

-18-

<PAGE> 1
EXHIBIT 10.4

MANAGEMENT AND OWNERSHIP AGREEMENT

THIS MANAGEMENT AND OWNERSHIP AGREEMENT (herein called this
"Agreement") dated as of September 23, 1994, is made by and among Brigham Oil &
Gas, L.P. ("BOG"), a Delaware limited partnership, Brigham Exploration Company
("BEC"), a Texas corporation, General Atlantic Partners III, L.P. ("GAP"), a
Delaware limited partnership, Harold D. Carter ("Carter"), a Texas resident,
Ben M. Brigham ("Brigham"), a Texas resident and GAP-Brigham Partners, L.P.
("GAP-Brigham"), a Delaware limited partnership.

RECITALS:

WHEREAS, certain of the parties are entering into an agreement of
limited partnership of even date herewith establishing Quest Acquisitions,
L.P., a Texas limited partnership (the "Partnership"); and

WHEREAS, certain of the parties are concurrently entering into
documentation to establish Quest Resources, L.L.C. ("Quest"), a limited
liability company that will act as the Managing General Partner of the
Partnership; and

WHEREAS, the parties desire to authorize such agreements and the
transactions authorized thereby and to waive and amend any restrictions and
other provisions contained in certain other documentation by and among the
parties;

NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants and agreements contained herein, the parties hereto do hereby
agree as follows:

1. BEC and GAP hereby agree that all amounts earned and/or
distributed to such parties from their interests in Quest shall be considered
to be amounts earned under the Agreement of Limited Partnership of BOG dated
May 1, 1992, as amended (the "BOG Partnership Agreement"), for purposes of
computing Threshold Value (as such term is defined in the BOG Partnership
Agreement) and any amounts distributed to BEC and GAP from the Quest shall be
considered to be a distribution to such parties from BOG and accordingly shall
reduce the Threshold Value under the BOG Partnership Agreement. BEC, GAP,
Carter and GAP-Brigham hereby amend the BOG Partnership Agreement to the extent
necessary to conform to the agreement set forth in this Section 1.

2. Notwithstanding any agreement or duty under law to the
contrary, each of BEC and GAP hereby agree that GAP shall own its interest in
Quest for its own behalf and not on behalf of BEC or BOG and that BEC shall own
its interest in Quest on its own behalf and not for the benefit of GAP or BOG.

3. Each of BEC, GAP, BOG, Carter, Brigham and GAP-Brigham hereby
agree that notwithstanding anything to the contrary in Section 12.3 or
elsewhere in the BOG Partnership Agreement or in Section 16 or elsewhere in the
Employment Agreement dated May 1, 1992 by and between Ben M. Brigham and BOG
(the "Brigham Employment Agreement"), Ben M. Brigham shall have the right to
act as Manager and President of guest and the provisions of the BOG Partnership
Agreement and the Brigham Employment Agreement are hereby amended to the extent
necessary to permit Ben M. Brigham to act in such capacities of behalf of
Quest.
<PAGE> 2
IN WITNESS WHEREOF, the parties have executed this Agreement by their
duly authorized officers, as of the date first written above.

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
General Partner

By: /s/ Ben M. Brigham
---------------------------------
Ben M. Brigham, President

BRIGHAM EXPLORATION COMPANY

By: /s/ Ben M. Brigham
---------------------------------
Ben M. Brigham, President

GENERAL ATLANTIC PARTNERS III, L.P.

By: GAP III Investors, Inc.,
its General Partner

By: /s/ William Ford
---------------------------------
Name: William Ford
----------------------
Title: Vice President
---------------------

/s/ Ben M. Brigham
-------------------------------------------
Ben M. Brigham

/s/ Harold D. Carter
-------------------------------------------
Harold D. Carter

GAP-BRIGHAM PARTNERS, L.P.

By: /s/ Stephen P. Reynolds
----------------------------------------
General Partner

<PAGE> 1
EXHIBIT 10.5

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this "Agreement") made as of May 1, 1992,
by Brigham Oil & Gas, L.P., a Delaware limited partnership (the "Company") and
Ben M. Brigham ("Employee");

W I T N E S S E T H:

WHEREAS, the Company desires to employ Employee, and Employee desires
to be employed by the Company, subject to and upon the terms and conditions
contained herein.

NOW, THEREFORE, in consideration of the mutual promises contained
herein, the parties, intending to be legally bound, agree as follows:

1. Defined Terms. All capitalized terms used but not defined
herein shall have the meanings assigned to them in the Agreement of Limited
Partnership of the Company.

2. Employment and Duties. Subject to the terms hereof, the
Company agrees to employ Employee to render full-time services to the Company
as Chief Executive Officer of the Company. Employee shall have such duties as
are customarily associated with such position, together with such other duties
as may be assigned to Employee from time to time by the Management Committee of
the Company. Employee agrees to devote his full time and attention to the
performance and fulfillment of such duties, functions and responsibilities as
is necessary to discharge such duties, functions and responsibilities, except
for service for civic, charitable or non-profit organizations and other non-
competitive endeavors not interfering with his duties hereunder.

3. Base Compensation. The Company shall pay Employee for his
services under this Agreement a base annual salary of $138,000 (before Federal
and state withholdings), payable semi-monthly or in such other installments as
shall be consistent with the Company's general payroll practices. Employee
shall be eligible for increases in his base annual salary at least annually, on
the anniversary of the effective date of this Agreement. The amount of such
increases, if any, shall be determined by the Management Committee.

4. Fringe Benefits. During the term hereof Employee shall be
entitled to participate in any benefit programs applicable to all employees or
to executive employees of the Company on the same basis as such benefits are
customarily made available by the Company from time to time, including without
limitation all employee retirement, insurance, vacation, sick leave, long-term
disability and other benefit programs, as such plans may be modified, amended
or terminated from time to time. In addition, Employee shall receive a
Petroleum Club membership at the expense of the Company at all times during the
term of this Agreement.
<PAGE> 2
5. Business Expenses. Employee shall be reimbursed by the
Company for expenses reasonably paid or incurred by him in connection with the
performance of his duties hereunder upon presentation of expense statements,
receipts or vouchers or such other supporting information reasonably evidencing
such expenses.

6. Term. The term of Employee's employment by the Company
hereunder shall be for a period of five (5) years commencing on the date of
this Agreement.

7. Termination. The Employee's employment with the Company shall
terminate upon the first to occur of (i) expiration of the term hereof, (ii)
the death of Employee, (iii) disability of Employee (as more fully discussed
below), (iv) termination of Employee for Cause (as defined below), (v)
termination by Employee for Good Reason (as defined below), or (vi) the written
consent of all parties to this Agreement.

8. Death of Employee. The employment of Employee hereunder shall
cease on the date of his death. The Company will purchase life insurance on
the life of Employee in an amount mutually agreeable to the Company and
Employee, the benefits of which will be payable to Employee's beneficiary (as
defined below). Employee's "beneficiary" is the person or persons (who may be
designated concurrently, successively or contingently) designated by Employee
in his last effective writing filed with the Company prior to his death, or if
Employee shall have failed to make an effective designation, Employee's
beneficiary is his spouse, if living at the time of each payment, and otherwise
his surviving children. Employee shall assist the Company in procuring such
insurance by submitting to such examinations and by signing such applications
and other instruments as may be reasonable and as may be required by the
insurance carriers to which application is made for any such insurance.
Employee represents that, to the best of his knowledge, he is currently
insurable at standard premium rates for life insurance policies.

9. Disability of Employee. If, as a result of the Employee's
incapacity due to physical or mental illness, Employee shall have been absent
from his duties hereunder on a full-time basis for the entire period of six
consecutive months, and within thirty (30) days after written notice of
termination is given (which may occur before or after the end of such six-month
period) shall not have returned to the performance of his duties hereunder on a
full-time basis, employment of Employee hereunder shall cease.

The Company shall purchase disability insurance to cover such a
contingency with coverage and benefits mutually agreeable to the Company and
Employee. Employee shall assist the Company in procuring such insurance by
submitting to such examinations and by signing such applications and other
instruments as may be reasonable and as may be required by the insurance
carriers to

2
<PAGE> 3
which application is made for any such insurance. Employee represents that, to
the best of his knowledge, he is currently insurable at standard premium rates
for life insurance policies. During any period prior to termination during
which the Employee fails to perform his duties hereunder as a result of
incapacity due to physical or mental illness ("disability period"), the
Employee shall continue to receive his full salary at the rate then in effect
for such period until his employment terminates pursuant to this Paragraph 9.

If employment of Employee hereunder terminates because of Employee's
incapacity, Employee (or, in the event of his legal incapacity, a
court-appointed guardian for his benefit) shall receive those benefits payable
under the disability policy or policies (purchased in compliance with the
foregoing provisions) in effect at such time.

10. Termination for Cause. The Company may terminate the Employee's
employment hereunder for Cause. For purposes of this Agreement, the Company
shall have "Cause" to terminate the Employee's employment hereunder upon (A)
the willful and continued failure by the Employee to substantially perform his
duties hereunder (other than any such failure resulting from the Employee's
incapacity due to physical or mental illness or infirmity), after demand for
substantial performance is delivered by the Company that specifically
identifies the manner in which the Company believes the Employee has not
substantially performed his duties or (B) the willful engaging by the Employee
in misconduct which is materially injurious to the Company, monetarily or
otherwise. For purposes of this paragraph, no act, or failure to act, on the
Employee's part shall be considered "willful" unless done, or omitted to be
done, by him not in good faith and without reasonable belief that his action or
omission was in or not opposed to the best interest of the Company.
Notwithstanding the foregoing, the Employee shall not be deemed to have been
terminated for Cause without (i) reasonable notice to the Employee setting
forth the reasons for the Company's intention to terminate for Cause, (ii) an
opportunity for the Employee, together with his counsel, to be heard before the
Management Committee, including at least one Management Committee member
elected by Brigham, and (iii) delivery to the Employee of a Notice of
Termination as defined in Paragraph 12 hereof from the Management Committee,
including at least one Management Committee member elected by Brigham, finding
that in the good faith opinion of such Management Committee the Employee was
guilty of conduct set forth above in clause (A) or (B) of the preceding
sentence, and specifying the particulars thereof in detail.

11. Termination by the Employee. The Employee may terminate his
employment hereunder (i) for Good Reason or (ii) if his health should become
impaired to an extent that makes his continued performance of his duties
hereunder hazardous to his physical or

3
<PAGE> 4
mental health or his life, provided that the Employee shall have furnished the
Company with a written statement from a qualified doctor to such effect and,
provided further, that, at the Company's request, the Employee shall submit to
an examination by a qualified doctor selected by the Company and such doctor
shall have concurred in the conclusion of the Employee's doctor.

For purposes of this Agreement, "Good Reason" shall mean (A) a change
in control of General Atlantic at any time during the six (6) months
immediately preceding termination of employment by the Employee, (B) a failure
by the Company to comply with any material provision of this Agreement which
has not been cured within thirty (30) working days after notice of such
noncompliance has been given by the Employee to the Company, or (C) any
purported termination of the Employee's employment which is not effected
pursuant to a valid Notice of Termination satisfying the requirements of
Paragraph 11 hereof (and for purposes of this Agreement no such purported
termination shall be effective).

For purposes of this Agreement, a "change in control of General
Atlantic" shall be deemed to have occurred if (Y) any "person" (as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), other than any person who on the date hereof is
an owner, partner, director or officer of General Atlantic, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of General Atlantic representing more than 50% of
the combined voting power of General Atlantic's then outstanding securities or
ownership interests (except where any such increase in a person's beneficial
ownership results from a redemption or purchase by General Atlantic of its
securities or ownership interests) or (Z) during the term of this Agreement,
individuals who constitute the General Atlantic Representatives on the
Management Committee are other than Alexis Cranberg, William Ford, Ed Cohen,
Steve Denning, Dave Hodgson, Steve Reynolds or Michael Cline, unless the
election of each such Representative has been approved in advance by a majority
of the Brigham Representatives.

An election by the Employee to terminate for Good Reason shall not be
deemed a voluntary termination of employment by Employee for the purpose of
this Agreement or any plan or practice of the Company.

12. Notice of Termination. Any termination of the Employee's
employment by the Company or by the Employee pursuant to Paragraphs 9, 10 or 11
shall be communicated by written Notice of Termination to the other party
hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provisions in this
Agreement relied upon and shall set forth in reasonable detail the facts and

4
<PAGE> 5
circumstances claimed or provide a basis for termination of the Employee's
employment under the provision so indicated.

13. Termination of Employment for Cause or Without Good Reason.
Any termination of employment by the Employee that is not for Good Reason or
termination of the Employee's employment by the Company for Cause shall be a
breach of this Agreement by the Employee and, if such termination occurs all
rights, benefits and compensation of the Employee under this Agreement shall
immediately terminate, except that equity options, if any, shall continue to be
governed in accordance with their terms. The rights and remedies of the
Company as set forth in this Paragraph 13, in case of termination of employment
by the Employee without Good Reason or termination of the Employee's employment
by the Company for Cause, shall be cumulative with and shall be in addition to
(i) any and all other relief available to the Company for breach by the
Employee of any other provision of this Agreement, and (ii) any and all other
general or equitable relief to which the Company may be entitled by reason of
such breach.

14. Other Termination of Employment. If the Employee shall
terminate his employment for Good Reason under Paragraph 11 hereof, then the
Company shall pay to Employee his base compensation described in Paragraph 3
hereof and in effect at such time of termination for a period of one (1) year
following such termination. If employment of Employee hereunder is terminated
under any other circumstances other than those set forth in Paragraphs 8, 9, 10
or 13 hereof, then the Company shall pay to Employee the remaining base
compensation described in Paragraph 3 hereof and in effect at such time of
termination for the term of this Agreement; provided that the Company shall
also pay to Employee those amounts provided in Paragraphs 8 and 9 pursuant to
the terms thereof.

15. Confidentiality; Ownership of Patentable Inventions.

(a) Employee will maintain the confidentiality of, and will not
disclose without the Company's express consent, any and all proprietary or
confidential information of the Company. The provisions of this paragraph will
be deemed to encompass any and all confidential or proprietary information of
the Company that was obtained by Employee since the commencement of Employee's
employment with the Company and confidential and proprietary information of BEC
on the date of this Agreement. This paragraph will continue after, and will not
be deemed to be extinguished or terminated by, the termination of this
Agreement or of Employee's employment by the Company. For purposes of this
paragraph "proprietary or confidential information" of the Company does not
include (i) information that is or becomes generally available to the public
other than as a result of disclosure by the Employee in breach of this
Agreement, (ii) information that was or is available to Employee on a
non-confidential basis, (iii) any non-patentable

5
<PAGE> 6
information that is or was conceived, created or independently developed by
Employee, or (iv) information that is disclosed by Employee to others on behalf
of the Company or to further the business opportunities or best interests of
the Company.

(b) Employee agrees that any patentable invention, design or
process made, invented or discovered by Employee in the course of his
employment hereunder shall be the property of the Company and Employee shall
execute and deliver all documents necessary and proper to make all such
patentable inventions, designs or processes the property of the Company.

16. Non-Competition.

(a) Employee agrees that during the term of this Agreement he will
not, directly or indirectly, for Employee's own account or for the benefit of
any other person or party engage or become, without the prior consent of the
Company, an owner, director, manager, officer, partner, operator, employee or
agent of, or render services to or invest in, any business or enterprise
competing with the primary business of the Company.

(b) In addition to the agreement in Section 16(a), for a period of
two years after the term of this Agreement Employee agrees not to compete with
the Company with respect to any prospect established with respect to Company
properties owned at the time of termination of this Agreement, or any other
specific matter or opportunity, which was specifically identified by the
Company to Employee in writing as of the date of such termination.

Notwithstanding the foregoing, nothing in this Agreement shall
prohibit Employee from being a passive investor in (i) any Fortune 500
companies, or (ii) any other business or enterprise (A) not in direct
competition with the business of the Company [and] (B) not an entity which is a
party to an exploration agreement with the Company. Provided, however, that
with respect to any investment in a business or enterprise engaged in the oil
and gas industry (other than any Fortune 500 companies), Employee shall obtain
the prior consent of the Management Committee (including the vote or consent of
at least one GAP Representative), which consent shall not be unreasonably
withheld.

If Employee intentionally breaches any provisions of Section 15 or
this Section 16 (collectively the "Restrictive Covenants") in a material way,
the Company shall have the right to have the Restrictive Covenants specifically
enforced by any court having equity jurisdiction it being acknowledged and
agreed that any such breach will cause irreparable injury to the Company and
that money damages will not provide adequate remedy to the Company. The
Company's right of specific performance hereunder shall be independent of, and
in addition to, any other rights and remedies available to the Company under
law or in equity.

6
<PAGE> 7
If any court determines that any of the Restrictive Covenants or any
part thereof is invalid or unenforceable, the remainder of the Restrictive
Covenants shall not thereby be affected and shall be given full effect, without
regard to the invalid portions. If any court determines that any of the
Restrictive Covenants, or any part thereof, is unenforceable because of the
duration or geographic scope of such provision, such court shall have the power
to reduce the duration or geographical scope of such provision, as the case may
be and, in its reduced form, such provision shall then be enforceable and shall
be enforced.

17. Miscellaneous. (a) Notices. Any notice or communication
required or permitted hereunder shall be given in writing and shall be (i) sent
by first class registered or certified United States mail, postage prepaid,
(ii) sent by overnight or express mail or expedited delivery service, (iii)
delivered by hand or (iv) transmitted by wire, telex or telefax, addressed as
follows:

If to Employee: Ben M. Brigham
Brigham Exploration Company
4925 Greenville Avenue
Suite 707
Dallas, Texas 75206
Telephone No.: (214) 360-9182
Telecopy No.: (214) 691-6814

If to the Company: Brigham Oil & Gas, L.P.
4925 Greenville Avenue
Dallas, Texas 75206
Suite 707
Attn: Ben M. Brigham
Telephone No.: (214) 360-9182
Telecopy No.: (214) 691-6814

with a copy to: General Atlantic Partners III, L.P.
125 East 56th Street
New York, New York 10022

or to such other address or to the attention of such other person as hereafter
shall be designated in writing by the applicable party in accordance herewith.
Any such notice or communication shall be deemed to have been given as of the
date of first attempted delivery at the address and in the manner provided
above.

(b) Successors and Assigns. This Agreement is personal in nature and
neither of the parties hereto shall, without the consent of the other, assign
or transfer this Agreement or any rights or obligations hereunder; provided,
however, that in the event of a merger, consolidation or transfer or sale of
all or substantially all of the assets of the Company, this Agreement shall be
binding upon the successor to the Company's business and assets.

7
<PAGE> 8
(c) Interpretation. When the context in which words are used in
this Agreement indicates that such is the intent, words in the singular number
shall include the plural and vice versa, and the words in masculine gender
shall include the feminine and neuter genders and vice versa.

(d) Severability. Every provision in this Agreement is intended
to be severable. In the event that any provision of this Agreement shall be
held to be invalid, the same shall not affect in any respect whatsoever the
validity of the remaining provisions of this Agreement.

(e) Captions. Any section or paragraph titles or captions contained
in this Agreement are for convenience only and shall not be deemed a part of
the context of this Agreement.

(f) Entire Agreement. This Agreement together with the Partnership
Agreement contains the entire understanding and agreement between the parties
and supersedes any prior written or oral agreements between them respecting the
subject matter contained herein. There are no representations, agreements,
arrangements or understandings, oral or written, between and among the parties
hereto relating to the subject matter of this Agreement which are not fully
expressed herein or therein.

(g) No Waiver. The failure of any party to insist upon strict
performance of a covenant hereunder or of any obligation hereunder,
irrespective of the length of time for which such failure continues, shall not
be a waiver of such party's right to demand strict compliance in the future.
No consent or waiver, express or implied, to or of any breach or default in the
performance of any obligation hereunder shall constitute a consent or waiver to
or of any other breach or default in the performance of the same or any
obligation hereunder.

(h) Amendment. This Agreement may be changed, modified or amended
only by an instrument in writing duly executed by all of the parties hereto.
Any such amendment shall be effective as of such date as may be determined by
the parties hereto.

(i) Enforcement. The Company may enforce this Agreement pursuant to
the provisions of the Agreement of Limited Partnership of the Partnership,
provided that in the event of a dispute, either General Partner of the Company
shall have the right to enforce the provisions hereof.

(j) Choice of Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY TEXAS LAW.

8
<PAGE> 9
IN WITNESS WHEREOF, the parties have executed this Agreement or caused
the same to be executed by their duly authorized corporate officers, all as of
the day and year first above written.

"Employee" /s/ BEN M. BRIGHAM
-----------------------------
Ben M. Brigham

"Company" BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
General Partner

By: Name: /s/ BEN M. BRIGHAM
--------------------------
Title: President
------------------------

<PAGE> 1

EXHIBIT 10.6

CONSULTING AGREEMENT

THIS CONSULTING AGREEMENT (this "Agreement") is made as of May 2,
1995, by and between Brigham Oil & Gas, L.P., a Delaware limited partnership
(the "Company") and Harold D. Carter ( "Consultant").

W I T N E S S E T H:

WHEREAS, the Company previously had entered into a consulting
agreement with Consultant pursuant to the Agreement of Limited Partnership for
the Partnership (the "Partnership Agreement") which consulting agreement
expired for all purposes under the terms thereof and under the Partnership
Agreement on May 1, 1995; and

WHEREAS, the Company desires to enter into a separate agreement to
retain the services of Consultant on a current basis, and Consultant desires to
perform such services for the Company, subject to and upon the terms and
conditions contained herein;

NOW, THEREFORE, in consideration of the mutual promises contained
herein, the parties, intending to be legally bound, agree as follows:

1. Defined Terms. All capitalized terms used but not defined
herein shall have the meanings assigned to them in the Agreement of Limited
Partnership of the Company.

2. Employment and Duties. The Company agrees to retain the
services of Consultant to perform such consulting and advisory services
regarding the operations of the Company as the Company shall request from time
to time during the term of this Agreement. Consultant shall make himself
available to act as a Representative on the Management Committee and to consult
with the Management Committee, the Chief Executive Officer and other officers
of the Company at reasonable times, concerning matters pertaining to the
acquisition, exploration, development and operation of Company properties, the
overall business plan, operating and capital budgets and other fiscal policy
issues of the Company, employee issues, and, in general, any issue concerning
the business affairs of the Company.

3. Amount of Service. It is anticipated that Consultant will
spend approximately 50% of his normal working time in performing his duties and
functions under this Agreement during the term of this Agreement. It is
understood that Consultant's time commitment to the Company may vary over time
consistent with the needs of the Company and Consultant agrees to devote such
time and attention to the performance and fulfillment of such duties, functions
and responsibilities as is necessary to fulfill such duties. Notwithstanding
the foregoing, it is specifically understood and agreed that Consultant may act
as a consultant or perform services for other parties other than the Company
and therefore will only be required to devote a portion of his time to his
services under this Agreement, which will not exceed 50% of his normal working
time without his consent. Consultant shall be deemed an independent contractor
for all purposes.

4. Compensation. The Company shall pay Consultant for his
services under this Agreement a consulting fee of $6,000 per month during the
term of this Agreement. The President of the Company and Consultant shall
review the consulting fee on an annual basis to
<PAGE> 2
determine any increases that the parties shall agree upon. All federal
withholding and other employment and income related taxes shall be the
responsibility of Consultant.

5. Business Expenses. Consultant shall be reimbursed by the
Company for any out of pocket expenses reasonably paid or incurred by him in
connection with the performance of his duties hereunder upon presentation of
expense statements or vouchers or such other supporting information reasonably
evidencing such expenses.

6. Term. The term of this Agreement shall commence on the date
hereof and terminate on May 1, 1997.

7. Termination. This Agreement shall terminate upon the first to
occur of (i) the expiration of the term hereof, (ii) the death, disability or
other incapacity of Consultant, or (iii) the written consent of both parties to
this Agreement. For purposes of this Agreement, the "disability or incapacity"
of Consultant shall occur if, as a result of Consultant's incapacity due to
physical or mental illness, Consultant shall have been absent from his services
hereunder on a continuous basis for the entire period of six consecutive
months, and within thirty (30) days after written notice of termination is
given (which may occur before or after the end of such six-month period) shall
not have returned to performing his services hereunder.

8. Limited Liability. With regard to the services to be performed
by Consultant pursuant to the terms of this Agreement, Consultant shall not be
liable to the Company, or to anyone who may claim any right due to his
relationship with the Company, for any acts or omissions in the performance of
said services on the part of Consultant or on the part of the agents or
employees of Consultant, except when said acts or omissions of Consultant are
due to his willful misconduct or gross negligence. The Company shall hold
Consultant free and harmless from any obligations, costs, claims, judgments,
attorneys' fees and attachments arising from or growing out of the services
rendered to the Company pursuant to the terms of this Agreement or in any way
connected with the rendering of said services, except when the same shall arise
due to the willful misconduct or gross negligence of Consultant, and Consultant
is adjudged to be guilty of willful misconduct or gross negligence by a court
of competent jurisdiction.

9. Confidentiality. Consultant will maintain the confidentiality
of, and will not disclose without the Company's express consent, any and all
proprietary or confidential information of the Company. The provisions of this
paragraph will be deemed to encompass any and all confidential or proprietary
information of the Company that was obtained by Consultant since the
commencement of Consultant's employment with the Company. This paragraph will
continue after, and will not be deemed to be extinguished or terminated by, the
termination of this Agreement or of Consultant's employment by the Company. For
purposes of this paragraph "proprietary or confidential information" of the
Company does not include (a) information that is or becomes generally available
to the public other than as a result of disclosure by the Consultant in breach
of this Agreement, (b) information that was or is available to Consultant on a
non-confidential basis, (c) information that is or was conceived, created or
independently developed by Consultant, or (d) information that is disclosed by
Consultant to others on behalf of the Company or to further the business
opportunities or best interests of the Company.

2
<PAGE> 3
10. Miscellaneous. (a) Notices. Any notice or communication
required or permitted hereunder shall be given in writing and shall be (i) sent
by first class registered or certified United States mail, postage prepaid,
(ii) sent by overnight or express mail or expedited delivery service, (iii)
delivered by hand or (iv) transmitted by wire, telex or telefax, addressed as
follows:

If to Consultant: Harold D. Carter
5949 Sherry Lane
Suite 1616, L.B. 70
Dallas, Texas 75225
Telephone No.: (214) 360-9182
Fax No.: (214) 360-9825

If to the Company: Brigham Oil & Gas, L.P.
5949 Sherry Lane
Suite 1616, L.B. 70
Dallas, Texas 75225
Attn: Ben M. Brigham
Telephone No.: (214) 360-9182
Fax No.: (214) 360-9825

(b) Successors and Assigns. This Agreement is personal in nature
and neither of the parties hereto shall, without the consent of the other,
assign or transfer this Agreement or any rights or obligations hereunder;
provided, however, that in the event of a merger, consolidation or transfer or
sale of all or substantially all of the assets of the Company, this Agreement
shall be binding upon the successor to the Company's business and assets.

(c) Interpretation. When the context in which words are used in
this Agreement indicates that such is the intent, words in the singular number
shall include the plural and vice versa.

(d) Severability. Every provision in this Agreement is intended to
be severable. In the event that any provision of this Agreement shall be held
to be invalid, the same shall not affect in any respect whatsoever the validity
of the remaining provisions of this Agreement.

(e) Remedies. If any action at law or equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorney's fees, costs and necessary disbursements in
addition to any other relief to which he may be entitled.

(f) Captions. Any section or paragraph titles or captions
contained in this Agreement are for convenience only and shall not be deemed a
part of the context of this Agreement.

3
<PAGE> 4
(g) Entire Agreement. This Agreement together with the
Partnership Agreement contains the entire understanding and agreement between
the parties and supersedes any prior written or oral agreements between them
respecting the subject matter contained herein. There are no representations,
agreements, arrangements or understandings, oral or written, between and among
the parties hereto relating to the subject matter of this Agreement which are
not fully expressed herein or therein.

(h) No Waiver. The failure of any party to insist upon strict
performance of a covenant hereunder or of any obligation hereunder,
irrespective of the length of time for which such failure continues, shall not
be a waiver of such party's right to demand strict compliance in the future.
No consent or waiver, express or implied, to or of any breach or default in the
performance of any obligation hereunder shall constitute a consent or waiver to
or of any other breach or default in the performance of the same or any
obligation hereunder.

(i) Amendment. This Agreement may be changed, modified or amended
only by an instrument in writing duly executed by all of the parties hereto.
Any such amendment shall be effective as of such date as may be determined by
the parties hereto.

(j) Choice of Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY TEXAS LAW.

IN WITNESS WHEREOF, the parties have executed this Agreement or caused
the same to be executed by their duly authorized corporate officers, all as of
the day and year first above written.

"Consultant"

/s/ Harold D. Carter
----------------------------------
Harold D. Carter

"Company" BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
its Managing General Partner

By: /s/ Ben M. Brigham
-------------------------------
Ben M. Brigham, President

<PAGE> 1

EXHIBIT 10.10

BRIGHAM OIL & GAS, L.P.
INCENTIVE BONUS PLAN

THIS PLAN, made and executed at Dallas, Texas, by BRIGHAM, INC., a
Texas corporation, and BRIGHAM OIL & GAS, L.P., a Delaware limited partnership
(the "Company"),

WITNESSETH THAT:

WHEREAS, effective as of May 1, 1992, the Company established the
Brigham Oil & Gas, L.P. Phantom Royalty Account Plan to provide a performance
incentive for employees of the Company; and

WHEREAS, the Company now desires to amend said Plan to provide for
participation thereunder by employees of Brigham, Inc. and to make certain
conforming changes;

NOW, THEREFORE, pursuant to the provisions of Section 5.1 thereof, the
Brigham Oil & Gas, L.P. Phantom Royalty Account Plan is hereby amended by
restatement in its entirety to read as follows:

ARTICLE I.

DEFINITIONS

Section 1.1 Definitions. Unless the context clearly indicates
otherwise, when used in this Plan:

(a) "Account Percentage" means a Participant's percentage
of interest in a particular Incentive Account as determined under Plan
Section 3.2.

(b) "Accounting Date" means December 31, 1993, and each
subsequent March 31 and September 30 during the period one or more
Incentive Accounts are being maintained for the accounting purposes of
the Plan.

(c) "Commencement Date" means the date on which actual
drilling is commenced on a well, provided that, in the case where an
existing wellbore is reentered, and deepened or plugged back, (i) if
such wellbore was a Company Well prior to such reentry, the original
Commencement Date for such well shall remain the Commencement Date for
such well, or (ii) otherwise, the Commencement Date for such well
shall mean the date such reentry is actually commenced.

(d) "Company" means Brigham Oil & Gas, L.P., a Delaware
limited partnership.

(e) "Company Well" means a well (i) in which the Company
owns an interest (including, without limitation, a working
<PAGE> 2
interest, overriding royalty interest or a reversionary interest) in
the Hydrocarbons produced therefrom on the Commencement Date for such
well, (ii) for which the Commencement Date is after April 30, 1992,
and before this Plan is terminated, and (iii) which is completed as a
producer of Hydrocarbons in paying quantities.

(f) "Discretionary Bonus Account" means the account
established and maintained by the President pursuant to Plan Section
4.2 to record a portion of the revenue attributable to each Incentive
Interest under the Plan.

(g) "Employer" includes the Company, Brigham, Inc. and
any other incorporated or unincorporated trade or business which may
adopt the Plan with the consent of the President.

(h) "Hydrocarbons" means oil and gas, and substances
produced in association with oil and gas.

(i) "Incentive Account" means an account established and
maintained by the President pursuant to Plan Section 4.2 to record a
portion of the revenue attributable to a particular group of Incentive
Interests under the Plan.

(j) "Incentive Interest" means a fictional overriding
royalty which burdens a Company Well for the accounting purposes of
the Plan.

(k) "Net Revenue Interest" means, for each Company Well,
the share of Hydrocarbons from such Company Well to which the Company
is entitled on the Commencement Date for such Company Well, provided
that if the Company share of Hydrocarbons from such Company Well
changes after the Commencement Date for such Company Well as a result
of (i) agreements in force at the Commencement Date for such Company
Well or (ii) pooling or unitization agreed to or otherwise binding on
the Company, the Net Revenue Interest shall change so that it is equal
to such share of Hydrocarbons, and provided that the Net Revenue
Interest may also change as provided in Plan Article IV.

(l) "NRI/WI Ratio" means, for each Company Well, a
fraction (expressed as a percentage) the numerator of which is the Net
Revenue Interest for such Company Well and the denominator of which is
the portion of the cost of operating such Company Well which the
Company is obligated to bear as the result of its ownership interest
in such Company Well, determined on the Commencement Date for such
Company Well, provided that if the Net Revenue Interest changes (or if
the share of expenses which the Company is obligated to bear changes)
after the Commencement Date for such Company Well as a result of
agreements in effect on the Commencement Date for
-2-
<PAGE> 3
such Company Well, then the NRI/WI Ratio shall be recomputed each time
such change occurs, and provided that the NRI/WI Ratio may also change
as provided in Plan Article IV. For a Company Well as to which the
Company bears no share of expenses, the NRI/WI Ratio shall be deemed
to be one hundred percent (100%).

(m) "Participant" means an employee of an Employer who
has become a Participant in a particular Incentive Account pursuant to
Plan Section 3.2 and whose interest in such Account has not
terminated.

(n) "Plan" means the Brigham Oil & Gas, L.P. Phantom
Royalty Account Plan as in effect prior to February 28, 1997, and this
Brigham Oil & Gas, L.P. Incentive Bonus Plan as from time to time in
effect thereafter.

(o) "Plan Year" means the eight-month period commencing
May 1, 1992, and ending December 31, 1992, and the twelve-month period
ending each December 31 for periods after December 31, 1992.

(p) "President" means (i) for periods of time prior to
February 28, 1997, the President of the Company, and (ii) for periods
of time after February 27, 1997, the President of Brigham, Inc.

ARTICLE II.

PLAN ADMINISTRATION

Section 2.1 Plan Administration. This Plan shall be administered by
the President. The President shall have discretionary and final authority to
interpret and implement the provisions of the Plan, including without
limitation, authority to determine eligibility for benefits under the Plan and
to adopt rules and procedures for the administration of the Plan. Every
interpretation, choice, determination or other exercise by the President of any
power or discretion given to the President hereunder, either expressly or by
implication, shall be conclusive and binding upon all parties having or
claiming to have an interest under the Plan or otherwise directly or indirectly
affected by such action, without restriction, however, on the right of the
President to reconsider and redetermine such action.

Section 2.2 Indemnity. The Employers shall indemnify the President
and hold the President harmless against any claim, cost, expense (including
attorneys' fees), judgment or liability (including any sum paid in settlement
of a claim) arising out of any act or omission to act with respect to this
Plan, except in the case of willful misconduct.

-3-
<PAGE> 4
ARTICLE III.

PLAN PARTICIPATION

Section 3.1 Eligible Employees. Any employee of an Employer (other
than the President) may be designated by the President as eligible to become a
Participant for the purposes of this Plan.

Section 3.2 Plan Participation. Prior to the beginning of each Plan
Year (or prior to December 31, 1993, with respect to the Plan's Plan Year
ending December 31, 1992 or December 31, 1993), the President in his or her
absolute discretion (i) shall designate which of the eligible employees of an
Employer may become Participants in the Incentive Account to be established for
that Plan Year pursuant to Plan Section 4.2, and (ii) shall designate the
Account Percentage that each such employee who becomes a Participant will have
in such Incentive Account. An employee designated by the President as eligible
to become a Participant in a particular Incentive Account shall become such a
Participant by executing such Plan Participation Agreement as shall be
prescribed by the President from time to time, and upon becoming such a
Participant, shall continue to participate in such Account until the
termination of his or her interest therein as provided in this Plan.

ARTICLE IV.

PLAN ACCOUNTING AND DISTRIBUTIONS

Section 4.1 Incentive Interests. With respect to each Company Well
there shall exist an Incentive Interest equal to one percent (1%) of the Net
Revenue Interest of the Hydrocarbons produced and saved from such Company Well,
provided, however, that (i) the President may, on or before the Commencement
Date for a Company Well, designate, as the Incentive Interest for such Company
Well, a larger percentage of the Net Revenue Interest of the Hydrocarbons
produced and saved from such Company Well than the one percent (1%) specified
above, (ii) should at any time while the Company is bearing a portion of the
costs of operating a Company Well the NRI/WI Ratio for such Company Well be
less than seventy percent (70%), then the Incentive Interest for such Company
Well shall be zero for all Hydrocarbons produced during the period while the
Company is so bearing a portion of expenses and such NRI/WI Ratio is less than
seventy percent (70%), and (iii) should a Company Well be included in a unit
formed for the purposes of secondary or tertiary recovery, the Hydrocarbons
from such Company Well shall be the portion of the Hydrocarbons produced from
the unitized area which is allocated to the tract on which such well is located
(and if there is more than one well located on such tract, the Hydrocarbons
from such Company Well shall be equal to a portion of the Hydrocarbons so
allocated to such tract equal to 1 divided by the number of wells located on
such tract), and the Net Revenue Interest for such Company Well will be the Net
Revenue Interest of

-4-
<PAGE> 5
the Company in such Company Well without regard to such unitization.

Section 4.2 Plan Accounts. For Plan recordkeeping purposes, the
Company shall establish and maintain on its books (i) a Discretionary Bonus
Account, (ii) an Incentive Account for the period commencing May 1, 1992, and
ending December 31, 1992, and (iii) a separate Incentive Account for each Plan
Year commencing after December 31, 1992. Each Incentive Account shall be
designated by the year with respect to which it is established (thus the first
Incentive Account shall be designated the "1992 Incentive Account") and shall
continue in existence for accounting purposes until terminated in accordance
with this Plan.

Section 4.3 Account Credits. The Discretionary Bonus Account and
each Incentive Account shall be credited with the following amounts:

(a) The Discretionary Bonus Account shall be credited on
each Accounting Date with an amount equal to one-half (1/2) of the net
revenue (i.e., revenue net of production, severance and similar taxes,
and net of production marketing costs and costs of treating,
compressing, processing, transporting or otherwise handling production
beyond the wellhead) received by the Company during the six-month
period then ended (or in the case of the Plan's first Accounting Date,
during the period commencing May 1, 1992, and ending December 31,
1993) which is attributable to each Incentive Interest.

(b) Each Incentive Account shall be credited on each
Accounting Date with an amount equal to one- half (1/2) of the net
revenue (i.e., revenue net of production, severance and similar taxes,
and net of production marketing costs and costs of treating,
compressing, processing, transporting or otherwise handling production
beyond the wellhead) received by the Company during the six-month
period then ended (or in the case of the Plan's first Accounting Date,
during the period commencing May 1, 1992, and ending December 31,
1993,) which is attributable to the Incentive Interest for each
Company Well having a Commencement Date during the Plan Year with
respect to which such Account was established.

(c) If the Company sells, exchanges or otherwise disposes
of all or any portion of its interest in a Company Well burdened with
an Incentive Interest a portion of the net revenue attributable to
which is being credited to such Account, (i) the Incentive Interest
with respect to the interest so disposed of shall terminate as of the
date such disposition is effective, and (ii) an amount equal to 3.125%
of 1% (or if the President has designated an Incentive Interest for
such Company Well which is a percentage of Net Revenue Interest larger
than 1%, as provided by clause (i) of the first sentence of Section
4.1, an amount equal to 3.125% of such larger percentage) of the
consideration (net of costs

-5-
<PAGE> 6
associated with such sale, exchange or other disposition) received by
the Company which is attributable to the interest in the Company Well
so sold by it, shall be credited to such Account on each of the eight
(8) Accounting Dates immediately following such disposition (for the
purposes of this provision, any non-cash consideration received by the
Company, other than retained interests, which are covered by the
following proviso, shall be valued by the President and the foregoing
payments shall be made in cash based on such valuation); provided that
if the interest disposed of is less than the entire interest of the
Company in such Company Well, the Net Revenue Interest (and the NRI/WI
Ratio) for such Company Well shall be recomputed to be the Net Revenue
Interest (and NRI/WI Ratio) which exists for the interest retained by
the Company, and the Incentive Interest shall continue to exist with
respect to the interest so retained. The adjustment provided for in
the this paragraph (c) shall not apply to any plan of liquidation,
merger or reorganization to which the Company is a party and pursuant
to which the obligations of the Company under this Plan are assumed by
the successor operator of the Company's business under such plan.

Section 4.4 Plan Distributions. Within thirty (30) days after each
Accounting Date, the President shall determine each Participant's distributable
share of the total amount credited to an Incentive Account for the six-month
period then ended (or in the case of the Plan's first Accounting Date, for the
period commencing May 1, 1992, and ending December 31, 1993,) by multiplying
said total amount by the Participant's Account Percentage in such Account, and
shall direct the Employer which employs such Participant or employee to
distribute such share to the Participant in cash. In addition, at any time and
from time to time during any Plan Year, the President in his or her absolute
discretion may award a bonus to a Participant or any other employee of an
Employer (excluding the President) by directing the Employer which employs such
Participant to distribute to such Participant or employee in cash within thirty
(30) days all or any portion of the amount then credited to the Discretionary
Bonus Account. All amounts distributed from an Incentive Account or the
Discretionary Bonus Account pursuant to this Section shall be charged against
such Account at the time of distribution.

Section 4.5 Termination of Plan Interests. Any provision of this
Plan to the contrary notwithstanding, upon the termination of a Participant's
employment with an Employer for any reason other than his or her transfer to
employment with another Employer, such Participant's Account Percentage in each
Incentive Account established under the Plan shall terminate and such
Participant shall cease participating in the Plan; provided, however, that such
Participant (or in the event of such Participant's death, his or her estate)
shall be entitled to receive payment of any amount which is due to such
Participant (i) from an Incentive Account with respect to an Accounting Date
which is prior to such termination of employment, (ii) from the Discretionary
Bonus Account with respect

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<PAGE> 7
to a bonus awarded prior to such termination of employment, or (iii) with
respect to a lump-sum settlement election made by the Company prior to such
termination of employment.

Section 4.6 Lump-Sum Settlement. At any time and from time to time,
the Company may elect to make a lump-sum settlement with respect to the
interest of one or more Participants in one or more Incentive Interests
designated under the Plan. The amount of any such lump-sum settlement shall be
equal to eighty percent (80%) of the amount determined by the President to be
the discounted present value of the estimated future amounts distributable to
or with respect to the Participant from an Incentive Account which are
attributable to such Incentive Interest or Interests. For the purposes of this
Plan, such present value shall be determined (a) using a discount rate
assumption equal to the greater of (i) ten percent (10%) or (ii) five percent
(5%) above the rate of interest the Company's principal commercial bank has
announced or designated as its prime rate of interest at the time the lump-sum
settlement election under this Section is made by the Company, (b) using such
oil and gas pricing and production assumptions and other factors affecting
revenue as the President in his or her absolute discretion may deem
appropriate, and (c) using the assumption that the Participant's employment
with the Company will terminate at the end of ten (10) years. In determining
any estimated future amounts distributable to or with respect to a Participant
from an Incentive Account for the purposes of this Section, the President may
employ such experts as the President may deem appropriate for such purpose.
Any lump-sum settlement to be paid to a Participant pursuant to the provisions
of this Section (i) shall be paid by the Employer which employs such
Participant, (ii) shall be made within sixty (60) days of the Company's
election with respect thereto, and (iii) shall fully satisfy and discharge the
Employers' obligations under this Plan with respect to the interest or
interests to which the settlement relates.

ARTICLE V.

AMENDMENT AND TERMINATION

Section 5.1 Amendment and Termination. The President shall have the
right and power at any time and from time to time to amend this Plan, in whole
or in part, and at any time to terminate this Plan; provided, however, that no
such amendment or termination shall reduce any amount which is due to a
Participant from an Incentive Account with respect to an Accounting Date which
precedes the date of such amendment or termination.

-7-
<PAGE> 8
ARTICLE VI.

MISCELLANEOUS PROVISIONS

Section 6.1 Nature of Plan and Rights. This Plan provides for the
payment of current cash bonuses to the Participants. The Incentive Interests
designated and Accounts established under this Plan are only fictional devices
for determining an amount of money to be paid by an Employer to the
Participants who are its employees. No provision of this Plan shall be deemed
or construed to create a trust fund of any kind or to grant any actual royalty
or other property interest of any kind in a Company Well or in any oil and gas
lease or in any other property or asset of an Employer. All Company Wells and
Account balances referred to in this Plan are and shall continue for all
purposes to be a part of the general assets of the Company, and to the extent
that any Participant acquires a right to receive a payment from an Employer
under this Plan, such right shall be no greater than the right of any unsecured
general creditor of such Employer.

Section 6.2 Spendthrift Provision. No right or interest of any
Participant under this Plan may be assigned, transferred or alienated, in whole
or in part, either directly or by operation of law, and no such right or
interest shall be liable for or subject to any debt, obligation or liability of
such Participant.

Section 6.3 Employment Noncontractual. The establishment of this
Plan shall not enlarge or otherwise affect the terms of any Participant's
employment with an Employer, and such Employer may terminate the employment of
any Participant at will and as freely and with the same effect as if this Plan
had not been established.

Section 6.4 Applicable Law. This Plan shall be governed and
construed in accordance with the laws of the State of Texas except where
superseded by federal law.

IN WITNESS WHEREOF, this Plan has been executed to be effective as of
February 28, 1997.

BRIGHAM, INC.

By /s/ BEN M. BRIGHAM
-------------------------------------
Ben M. Brigham, President

BRIGHAM OIL & GAS, L.P.

By /s/ BEN M. BRIGHAM
-------------------------------------
Ben M. Brigham, President

-8-

<PAGE> 1

EXHIBIT 10.11

Execution

================================================================================

BRIGHAM OIL & GAS, L.P.

$16,000,000

5% Convertible Subordinated Notes due September 1, 2002

-------
NOTE PURCHASE AGREEMENT
-------

Dated August 24, 1995

================================================================================
<PAGE> 2
TABLE OF CONTENTS

Page Section
- ---- -------

<S> <C> <C>
1. AUTHORIZATION OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2. SALE AND PURCHASE OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

3. CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

4. CONDITIONS TO CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.1. Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.2. Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.3. Compliance Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.4. Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4.5. Amendment to Partnership Agreement; Proceedings and Documents . . . . . . . . . . . . 3

5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . 3
5.1. Organization; Power and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.2. Authorization, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.3. Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.4. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5.5. Compliance with Laws, Other Instruments, etc. . . . . . . . . . . . . . . . . . . . . 4
5.6. Governmental Authorizations, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.7. Litigation; Observance of Statutes and Orders . . . . . . . . . . . . . . . . . . . . 5
5.8. Title to Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.9. Private Offering by the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.10. Use of Proceed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

6. REPRESENTATIONS OF LENDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
6.1. Purchase for Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

7. INFORMATION AS TO COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7.1. Financial and Business Information . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7.2. Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
7.3. Additional Convertible Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

8. PREPAYMENT OF THE NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
8.1. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
8.2. Deferred Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
8.3. Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

9. SUBORDINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
9.1. Subordination of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
</TABLE>
i
<PAGE> 3

<TABLE>
<S> <C> <C>
9.2. Subordination of Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
9.3. Assets Wrongly Received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
9.4. No Acceleration or Institution of Collection Proceedings . . . . . . . . . . . . . . 12
9.5. Insolvency Proceedings, Power of Attorney . . . . . . . . . . . . . . . . . . . . . 12
9.6. Additional Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

10. REGISTRATION OF THE NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
10.1. Registration, Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
10.2. Replacement of Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

11. CONVERSION RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

12. PAYMENTS ON NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

13. EXPENSES, ETC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

14. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT . . . . . . . . . . . . . . . 16

15. AMENDMENT AND WAIVER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
15.1. Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
15.2. Binding Effect, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

16. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

17. CONFIDENTIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

18. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
18.1. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
18.2. Payments Due on Non-Business Days . . . . . . . . . . . . . . . . . . . . . . . . . 18
18.3. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
18.4. Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
18.5. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
18.6. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
18.7. Limitation on Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
18.8. Jurisdiction and Venue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
18.9. JURY TRIAL WAIVED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

SCHEDULE A -- Information Relating to Lenders
SCHEDULE B -- Defined Terms
SCHEDULE 5.4 -- Financial Statements
SCHEDULE 5.7 -- Certain Litigation
EXHIBIT 1 -- Form of 5% convertible Subordinated Note
EXHIBIT 4.4 -- Form of Opinion of Special Counsel for the Company

</TABLE>
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<PAGE> 4

BRIGHAM OIL & GAS, L.P.
5949 Sherry Lane
Suite 1616
Dallas, Texas 75225

5% Convertible Subordinated Notes due September 1, 2002

August 24, 1995

RIMCO PARTNERS, L.P. II
RIMCO PARTNERS, L.P. III
RIMCO PARTNERS, L.P. IV
Suite 6875, 600 Travis St.
Houston, Texas 77002
("LENDERS")

Ladies and Gentlemen:

Brigham Oil & Gas, L.P., a Delaware limited partnership (the
"COMPANY"), agrees with you as follows:

1. AUTHORIZATION OF NOTES.

The Company will authorize the issue and sale of its 5% Convertible
Subordinated Notes due September 1, 2002 in the aggregate principal amount of
$16,000,000 (the "NOTES", such term to include any such note or notes issued in
substitution therefor pursuant to Section 10 of this Agreement). The Notes
shall be substantially in the form set out in Exhibit 1, with such changes
therefrom, if any, as may be approved by Lenders and the Company. Certain
capitalized terms used in this Agreement are defined in Schedule B; references
to a "Schedule" or an "Exhibit" are, unless otherwise specified, to a Schedule
or an Exhibit attached to this Agreement; the word "or" is not exclusive; the
word "including" means "including without limitation"; and "THIS AGREEMENT" and
references thereto shall mean this Agreement as it may from time to time be
amended or supplemented.

2. SALE AND PURCHASE OF NOTES.

Subject to the terms and conditions of this Agreement, at the Closing
provided for in Section 3 the Company will issue and sell a Note to each Lender
and each Lender will purchase such Note from the Company at par, in the
following stated principal amounts:

RIMCO PARTNERS, L.P. II $ 5,584,000
RIMCO PARTNERS, L.P. III $ 2,800,000
RIMCO PARTNERS, L.P. IV $ 7,616,000

TOTAL $16,000,000

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<PAGE> 5
3. CLOSING.

The sale and purchase of the Notes as contemplated in Section 2 above
shall occur at the offices of Thompson & Knight, P.C., 1700 Pacific Avenue,
Suite 3300, Dallas, Texas 75201, at 10:00 a.m., Dallas time, at a closing (the
"CLOSING") on such Business Day on or prior to August 18, 1995 as may be agreed
upon by the Company and Lenders (or on such day thereafter as the Company and
Lenders may specify, but in no event later than September 30, 1995). At the
Closing the Company will deliver to each Lender the Note to be purchased by
such Lender, dated the date of the Closing and registered in such Lender's name
(or in the name of such Lender's nominee), against delivery by such Lender to
the Company or its order of immediately available funds in the principal amount
thereof, by wire transfer of immediately available funds for the account of the
Company to account number 0100134972 at Bank One Texas, N.A., ABA #111000614
(or by surrender of Prior Secured Notes or payments thereof, as the Company and
the Lenders may agree). If at the Closing the Company shall fail to tender the
Notes to Lenders as provided above in this Section 3, or any of the conditions
specified in Section 4 shall not have been fulfilled, Lenders shall, at
Lenders' election, be relieved of all further obligations under this Agreement.

4. CONDITIONS TO CLOSING.

Lenders' obligation to purchase and pay for the Notes to be sold to
Lenders at the Closing is subject to the fulfillment, prior to or at the
Closing, of the following conditions:

4.1. REPRESENTATIONS AND WARRANTIES.

The representations and warranties of the Company in this Agreement
shall be true and correct in all material respects at the time of the Closing.

4.2. PERFORMANCE.

The Company shall have performed and complied with all agreements and
conditions contained in this Agreement required to be performed or complied
with by it prior to or at the Closing and after giving effect to the issue and
sale of the Notes (and the application of the proceeds thereof as contemplated
in Section 5.10).

4.3. COMPLIANCE CERTIFICATES.

(a) Officer's Certificate. The Company shall have delivered to
Lenders an Officer's Certificate, dated the date of the Closing, certifying
that the conditions specified in Sections 4.1, 4.2 and 4.5 have been fulfilled.

(b) Secretary's Certificate. The Company shall have delivered to
Lenders a certificate from the Secretary or an Assistant Secretary of the
Company or of the Managing General Partner, certifying as to (a) the
partnership proceedings of the Company and the corporate proceedings of the
Managing General Partner relating to the authorization, execution and delivery
of the Notes, this Agreement and the Partnership Agreement Amendment, (b) the
Agreement of Limited Partnership of the Company, as amended by the

2
<PAGE> 6
Partnership Agreement Amendment, (c) the articles of incorporation and bylaws
of the Managing General Partner, and (d) the incumbency of the officers of the
Managing General Partner who are executing the Notes, this Agreement and the
Partnership Agreement Amendment on behalf of the Company and the Managing
General Partner.

4.4. OPINION OF COUNSEL.

Lenders shall have received an opinion, dated the date of the Closing
from Thompson & Knight, P.C., counsel for the Company, in the form of Exhibit
4.4.

4.5. AMENDMENT TO PARTNERSHIP AGREEMENT; PROCEEDINGS AND DOCUMENTS.

The Partnership Agreement Amendment shall have been duly executed and
delivered by each of the Company's partners. All partnership and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be
satisfactory to Lenders and Lenders' special counsel, and Lenders and Lenders'
special counsel shall have received all such counterpart originals or certified
or other copies of such documents as Lenders or Lenders' special counsel may
reasonably request.

5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to Lenders that:

5.1. ORGANIZATION; POWER AND AUTHORITY.

The Company is a limited partnership that is duly formed and validly
existing under the laws of Delaware and is duly qualified as a foreign limited
partnership in each jurisdiction in which such qualification is required by
law, other than those jurisdictions as to which the failure to be so qualified
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. The Company has the power and authority as a limited
partnership to own or hold under lease the properties it purports to own or
hold under lease, to transact the business it transacts and proposes to
transact, to execute and deliver this Agreement and the Notes and to perform
the provisions hereof and thereof.

5.2. AUTHORIZATION, ETC.

This Agreement and the Notes have been duly authorized by all
necessary action on the part of the Company, and this Agreement constitutes,
and upon execution and delivery thereof each Note will constitute, a legal,
valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, fraudulent transfer,
moratorium or other similar laws affecting the enforcement of creditors' rights
generally and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

5.3. DISCLOSURE.

3
<PAGE> 7
Except as disclosed to Lenders in writing, since December 31, 1994,
there has been no change in the financial condition, operations, business or
properties of the Company or any of its Subsidiaries except changes that
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect. The Company has made available to Lenders and their
attorneys, accountants, and other advisors, prior to any issuance of the Notes,
all documents and other information that they have requested relating to the
Company, its operations, any investment in the Notes and any other matters
requested by such persons; the Company has accorded Lenders and their advisors
the opportunity to ask questions and receive answers from the Company (and its
engineering, legal, accounting, and other advisors) to all of their questions
concerning the Company, its operations, any investment in the Notes and such
other matters raised by them and their advisors; and the Company has provided
documents and responses to other questions only to the extent the Company
possesses such information or documents or could acquire such without
unreasonable effort or expense.

5.4. FINANCIAL STATEMENTS.

The Company has delivered to Lenders copies of the financial
statements of the Company and its Subsidiaries listed on Schedule 5.4. All of
such financial statements (including in each case the related schedules and
notes) fairly present in all material respects the consolidated financial
position of the Company and its Subsidiaries as of the respective dates
specified in such Schedule and the consolidated results of their operations and
cash flows for the respective periods so specified and have been prepared in
accordance with GAAP consistently applied throughout the periods involved
except as set forth in the notes thereto (subject, in the case of any interim
financial statements, to normal year-end adjustments).

5.5. COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC.

The execution, delivery and performance by the Company of this
Agreement and the Notes will not (i) contravene, result in any breach of, or
constitute a default under, or result in the creation of any liens, charges,
security interests, pledges, assignments or other encumbrances in respect of
any property of the Company or any Subsidiary under, any indenture, mortgage,
deed of trust, loan, purchase or credit agreement, lease, agreement of limited
partnership, certificate of limited partnership, corporate charter or by-laws,
or any other Material agreement or instrument to which the Company or any
Subsidiary is bound or by which the Company or any Subsidiary or any of their
respective properties may be bound or affected, (ii) conflict with or result in
a breach of any of the terms, conditions or provisions of any order, judgment,
decree, or ruling of any court, arbitrator or Governmental Authority applicable
to the Company or any Subsidiary or (iii) violate any provision of any statute
or other rule or regulation of any Governmental Authority applicable to the
Company or any Subsidiary.

4
<PAGE> 8
5.6. GOVERNMENTAL AUTHORIZATIONS, ETC.

No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of this Agreement or the
Notes.

5.7. LITIGATION; OBSERVANCE OF STATUTES AND ORDERS.

(a) Except as disclosed in Schedule 5.7, there are no actions, suits
or proceedings pending or, to the knowledge of the Company, threatened against
or affecting the Company or any Subsidiary or any property of the Company or
any Subsidiary in any court or before any arbitrator of any kind or before or
by any Governmental Authority that, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect.

(b) Neither the Company nor any Subsidiary is in default under any
order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including without limitation Environmental Laws) of any
Governmental Authority, which default or violation, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect.

5.8. TITLE TO PROPERTY.

The Company and its Subsidiaries have defensible title to their
respective oil and gas properties, including all such properties reflected in
the most recent audited balance sheet referred to in Section 5.4 or purported
to have been acquired by the Company or any Subsidiary after such date (except
as sold or otherwise disposed of in the ordinary course of business), except
for those defects in title that in the aggregate would not reasonably be
expected to have a Material Adverse Effect.

5.9. PRIVATE OFFERING BY THE COMPANY.

Neither the Company nor anyone acting on its behalf has offered the
Notes or any similar securities for sale to, or solicited any offer to buy any
of the same from, or otherwise approached or negotiated in respect thereof
with, any person other than Lenders. Neither the Company nor anyone acting on
its behalf has taken, or will take, any action that would subject the issuance
or sale of the Notes by the Company to the registration requirements of Section
5 of the Securities Act.

5.10. USE OF PROCEEDS.

The Company will apply the proceeds of the sale of the Notes to
retirement of the then outstanding principal balance of the 10% Secured General
Obligation Notes (the "Prior Secured Notes") issued in accordance with the Note
Purchase Agreement dated November 24, 1993, as amended. The remainder of the
proceeds will be used for exploration activities, working capital and general
corporate purposes.

5
<PAGE> 9
6. REPRESENTATIONS OF LENDERS.

6.1. PURCHASE FOR INVESTMENT.

Each Lender represents that it is an "accredited investor" within the
meaning of Regulation D under the Securities Act. Each Lender represents that
it is purchasing such Note for its own account or for one or more separate
accounts maintained by it or for the account of one or more pension or trust
funds and not with a view to the distribution thereof. Each Lender further
acknowledges that (i) the Company has made available to it and its attorneys,
accountants, and other advisors, prior to any issuance of the Notes, all
documents and other information that they have requested relating to the
Company, its operations, any investment in the Notes and any other matters
requested by such persons; (ii) the Company has accorded it and its advisors
the opportunity to ask questions and receive answers from the Company (and its
engineering, legal, accounting, and other advisors) to all of their questions
concerning the Company, its operations, any investment in the Notes and such
other matters raised by it and its advisors; and (iii) the Company has provided
documents and responses to other questions only to the extent the Company
possesses such information or documents or could acquire such without
unreasonable effort or expense. Each Lender further acknowledges that (i) the
Notes have not been registered under the Securities Act or the securities laws
of any state in reliance upon exemptions from the registration requirements of
such laws predicated in part on the representations of Lenders contained in
this Agreement; (ii) the Notes and any equity interests in the Company obtained
upon conversion of the Notes cannot be transferred unless they are subsequently
registered under the Securities Act or an exemption from such registration is
available with respect to such transfer; (iii) Lenders cannot sell, transfer,
or otherwise dispose of the Notes or any equity interests in the Company
obtained upon conversion of the Notes in violation of the Securities Act or any
applicable state securities laws or regulations; (iv) the Company's records may
be marked to indicate such transfer restrictions; and (v) the Company may
direct any transfer agent to enter a stock transfer order in its records with
respect to the Notes or any equity interests in the Company obtained on
conversion of the Notes in accordance with the foregoing.

7. INFORMATION AS TO COMPANY.

7.1. FINANCIAL AND BUSINESS INFORMATION.

The Company shall maintain financial records for its business in
accordance with good accounting practice and shall deliver to Lenders:

(a) Annual Statements -- within 90 days after the end of
each fiscal year of the Company, audited financial statements of the
Company for such fiscal year, which audited financial statements shall
be prepared in accordance with GAAP, audited by Price Waterhouse,
other independent certified accountants of recognized standing, or
other independent certified accountants consented to by Lenders (which
consent shall not be unreasonably withheld), and shall set forth, as
of the end of and for such fiscal year, a profit and loss statement
and a balance sheet of the Company, and such other information as, in
the judgment of the Chief Executive Officer of the

6
<PAGE> 10
Company, shall be reasonably necessary for the Lenders to be advised
of the financial status and results of operations of the Company.

(b) Quarterly Statements -- within 45 days after the end
of the first, second and third fiscal quarters of the Company in each
of its fiscal years, unaudited financial statements of the Company for
the portion of the fiscal year then ending, which financial statements
shall be prepared in accordance with GAAP (and certified by a Senior
Financial Officer as having been so prepared) and shall set forth, as
of the end of and for such portion of the fiscal year, a profit and
loss statement and a balance sheet of the Company, and such other
information as, in the judgment of the Chief Executive Officer of the
Company, shall be reasonably necessary for the Lenders to be advised
of the financial status and results of operations of the Company.

(c) Annual Engineering Report -- within 60 days after the
end of each fiscal year of the Company, a reserve engineering report
of the Company as of the end of such fiscal year, setting forth the
estimated oil and gas reserves of the Company at such time and
containing a calculation of the future net revenue from the production
of such reserves and of the discounted present value thereof. Such
reserve report shall be prepared by Cawley, Gillespie & Associates,
Inc., other independent petroleum reserve engineers of recognized
standing, or other independent petroleum reserve engineers consented
to by Lenders (which consent shall not be unreasonably withheld).

(d) Requested Information -- such other reports and
information as the Chief Executive Officer of the Company shall
determine or as the Lenders shall reasonably request from time to
time. Without limitation of the foregoing, all such requests by the
Lenders for reports and information which any limited partner in the
Company would be entitled to receive on request shall be deemed
reasonable.

7.2. MEETINGS.

The Company shall permit the representatives of any Lender to visit
the principal executive office of the Company upon reasonable advance notice
and during normal business hours to discuss the affairs, finances and accounts
of the Company with the Company's officers.

7
<PAGE> 11
7.3. ADDITIONAL CONVERTIBLE DEBT.

The Company will not issue additional Indebtedness which is both (a)
convertible into limited partnership interests of the Company, and (b)
contractually subordinated to any Senior Obligations, unless such additional
Indebtedness is also subordinated on substantially the same terms to the Notes
(provided that such subordination to the Notes shall be junior in all respects
to such subordination to such Senior Obligations).

8. PREPAYMENT OF THE NOTES.

8.1. PREPAYMENTS.

(a) No payments or prepayments of principal are required on the Notes
until September 1, 2002.

(b) The Company may, at its option at any time after September 1,
1998, upon notice as provided below, prepay the Notes, in whole, at a price
equal to the Principal Balance, plus the aggregate unpaid amount of Deferred
Interest, plus, if the "Public Trading Condition" is not met as of the date of
such prepayment, a Prepayment Penalty determined for such prepayment date. The
Company will give Lenders written notice of any optional prepayment under this
Section 8.1 not less than 30 days and not more than 60 days prior to the date
fixed for such prepayment, and during such period Lenders may, if they choose,
exercise their conversion rights described in Section 11 hereof.

For purposes hereof, the "Public Trading Condition" will be met as of
any date if: (i) the Company shall have been reorganized as a corporation
subject to federal income taxation under Subchapter C of the Internal Revenue
Code of 1986, as amended; (ii) the Company shall have made an initial public
offering of shares of its Common Stock pursuant to an effective registration
statement under the Securities Act; (iii) at least 25% of the total number of
shares of the Company's Common Stock outstanding as of such date shall be
publicly owned and subject to public trading on the NASDAQ National Market
System or a successor or equivalent registered interdealer quotation system or
on a registered national securities exchange; (iv) the initial public offering
price of the Company's shares of Common Stock or the Market Price of such
shares during any thirty consecutive trading days thereafter shall have been at
least equal to 125% of "RIMCO's Initial Value"; and (v) the shares of the
Company's Common Stock that would be received by Lenders, upon conversion of
the Notes in accordance with Section 11 hereof, may be sold by Lenders without
restriction under the Securities Act pursuant to an effective registration
statement filed under the Securities Act (or pursuant to any exception to
registration enacted hereafter).

For purposes hereof, "RIMCO's Initial Value" as of any date shall be
an amount per share of Common Stock which is equal to (i) $800,000, divided by
(ii) the product of 1% times the total number of issued and outstanding shares
of Common Stock of the Company outstanding as of such date.

8
<PAGE> 12
For purposes hereof, the "Market Price" of the shares of Common Stock
of the Company as of any trading day shall mean (i) if the shares are listed or
admitted to trading on any national securities exchange, the price obtained by
taking the arithmetic mean of the high and low sales price of such shares on
such trading day, or if no such sale takes place on such date, the average of
the highest closing bid and lowest closing asked prices thereof on such date,
in each case as officially reported on all national securities exchanges on
which such shares are then listed or admitted to trading, or (ii) if no shares
of Common Stock are then listed or admitted to trading on any national
securities exchange, the highest closing price of such shares on such date in
the over-the-counter market as shown by the NASDAQ national market system as
reported by any member firm of the New York Stock Exchange selected by the
Company.

(c) The Company may, at is option, at any time after the
occurrence of a "RIMCO Disapproval", prepay the Notes, in whole, at a price
equal to the Principal Balance, plus the aggregate unpaid amount of Deferred
Interest, plus a premium in an amount (expressed as a percentage of the
Principal Balance) that corresponds to the calendar year in which the
prepayment date occurs, as follows:

Year Premium
---- -------

1996 5.0%
1997 4.5%
1998 4.0%
1999 3.5%
2000 3.0%
2001 2.0%
2002 1.0%

For purposes hereof, a "RIMCO Disapproval" shall be deemed to have
occurred if (i) the "RIMCO Representative" (as defined in the Partnership
Agreement Amendment) shall not have voted to approve any "RIMCO Decision" (as
defined in the Partnership Agreement Amendment) which requires such RIMCO
Representative's approval pursuant to Section 6.1(l) of the Company's
partnership agreement, as added by the Partnership Agreement Amendment, and
(ii) to the extent approval by the Company's Management Committee is then
required under the Company's partnership agreement, such RIMCO Decision shall
have been approved by all of the other members of the Company's Management
Committee.

8.2. DEFERRED INTEREST.

(a) On each Interest Payment Date the Company may, at its option,
elect to borrow from Lenders (in proportion to their respective shares in the
Principal Balance) an additional amount equal to forty percent (40%) of the
interest then due and payable by the Company and use the amount so borrowed to
pay such portion of the interest which is then due and payable. The amount of
such borrowing shall constitute "Deferred Interest", and except to the extent
the Company otherwise pays more than sixty percent (60%) of the interest due on
the Notes on such Interest Payment Date, the Company shall be deemed to

9
<PAGE> 13
have borrowed such Deferred Interest from Lenders and to have applied such
Deferred Interest to the payment of the interest then due on the Notes. No
transfers of funds need take place in connection with any such deemed borrowing
and payment.

(b) The Company shall keep an account of the aggregate unpaid amount
of all Deferred Interest (herein called the "Deferred Interest Account") and
shall notify Lenders of the balance in the Deferred Interest Account within
thirty days after each Interest Payment Date. The balance in the Deferred
Interest Account at the close of business on each Interest Payment Date (i.e.,
the aggregate unpaid amount of Deferred Interest then outstanding) shall bear
interest at the rate of five percent (5.0%) per annum, computed on the basis of
a 360-day year of twelve 30-day months, which interest shall be due and payable
on the next following Interest Payment Date. On such next following Interest
Payment Date the Company may, at its option, elect to borrow from Lenders (in
proportion to their respective shares in the Principal Balance) an amount equal
to all of the interest which has accrued on the balance of the Deferred
Interest Account and use the amount so borrowed to pay such interest. The
amount of such borrowing shall constitute additional "Deferred Interest", and
on such Interest Payment Date (except to the extent the Company otherwise pays
any of the interest which has so accrued on the balance of the Deferred
Interest Account) the Company shall be deemed to have borrowed such additional
Deferred Interest from Lenders and to have applied such Deferred Interest to
the payment of the interest then due on such balance in the Deferred Interest
Account. No transfers of funds need take place in connection with any such
deemed borrowing and payment.

(c) As used in this Agreement, "Deferred Interest" means all of the
items described above which constitute "Deferred Interest". The obligation of
the Company to repay the Deferred Interest owing to each Lender shall be
evidenced by such Lender's Note, and the aggregate unpaid amount of Deferred
Interest shall be due and payable in full on September 1, 2002. As used in
this Agreement, "Principal Balance" means the aggregate unpaid principal
balance of the Notes at the time in question, excluding all Deferred Interest.

8.3. ACCELERATION.

The Company shall have a grace period of two Business Days
after any payment of interest becomes due under the Notes in which to make such
payment. If, by the end of such grace period, the Company has failed to make
such payment for any reason other than compliance with Section 9 hereof (or
compliance with any subordination agreement contemplated under Section 9.6
hereof), the Company shall be deemed to be in default hereunder. Upon the
occurrence of such a default, Lenders may give notice thereof to the Company
demanding that such payment be made. If the Company shall fail to pay such
interest within twenty Business Days after receiving such notice, then Lenders
holding two-thirds (66-2/3%) in principal amount of the Notes then outstanding
may, by notice to the Company (but only to the extent permitted under Section 9
hereof), declare all the Notes then outstanding to be immediately due and
payable. Upon the Notes so being declared due and payable, the Notes will
forthwith mature and the entire unpaid principal amount of the Notes plus all
accrued and unpaid interest thereon shall all be immediately due and payable,
without presentment, demand, or protest, all of which are hereby waived.

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<PAGE> 14
9. SUBORDINATION.

9.1. SUBORDINATION OF OBLIGATIONS.

Lenders hereby expressly subordinate and make junior and inferior, to
the extent provided for herein:

(i) all Subordinated Obligations owed to them and the
payment and enforcement of such Subordinated Obligations, to

(ii) the Senior Obligations and the payment and
enforcement of the Senior Obligations.

Whenever any Senior Obligations are outstanding, no Lender shall accept,
receive or collect (by set-off or other manner) any payment or distribution on
account of, or ask for or demand, directly or indirectly, any Subordinated
Obligation, and the Company shall not make any such payment, if at the time of
such payment or immediately after giving effect thereto, either:

(a) the maturity of any Senior Obligations shall have been
accelerated, and such acceleration shall continue without being rescinded and
annulled; or

(b) a Payment Default shall have occurred, and such default shall
not have been cured or waived; or

(i) the Company and each Lender shall have received
written notice (each a "Bar Notice") from any Senior Creditor of the
occurrence of a Nonpayment Default, and

(ii) such Nonpayment Default shall not have been cured or
waived, but no acceleration shall have occurred with respect to any
Senior Obligations, and

(iii) not more than 180 days shall have elapsed after the
date of receipt by each Lender of such Bar Notice;

provided, however, that no Lender shall be obligated to give effect to more
than one Bar Notice during any period of 360 consecutive days. The Company
shall resume payments in respect of the Subordinated Obligations or any
judgment with respect thereto: (1) in the case of an acceleration referred to
in subsection (a) of this section, upon the recision or annulment thereof
following the cure or waiver of the events giving rise to such acceleration,
(2) in the case of a default referred to in subsection (b) of this section,
upon the cure or waiver thereof, and (3) in the case of a Nonpayment Default
referred to in subsection (c) of this section, upon the earlier to occur of the
cure or waiver of such default or the expiration of the 180 day period referred
to in subsection (iii) of such subsection.

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<PAGE> 15
9.2. SUBORDINATION OF LIENS.

Any liens, charges, security interests, pledges, assignments or other
encumbrances at any time securing the Subordinated Obligations are hereby made,
and will at all times whenever any Senior Obligations are outstanding be,
subject, subordinate, junior and inferior in all respects to all liens,
charges, security interests, pledges, assignments or other encumbrances
securing the Senior Obligations.

9.3. ASSETS WRONGLY RECEIVED.

If any Lender receives any payment or distribution of any kind
(whether in cash, securities or other property) in contravention of this
Agreement, it shall hold such payment or distribution in trust for the Senior
Creditors, shall segregate the same from all other cash or assets it holds, and
shall promptly deliver the same to Senior Creditors in the form received by
such Lender (together with any necessary endorsement) to be applied to or, at
Senior Creditors' option held as collateral for, the payment or prepayment of
the Senior Obligations.

9.4. NO ACCELERATION OR INSTITUTION OF COLLECTION PROCEEDINGS.

Whenever any Senior Obligations are outstanding, no Lender shall
accelerate the Notes (pursuant to Section 8.3 hereof or otherwise) or collect
or attempt to collect any part of the Subordinated Obligations -- whether
through the commencement or joinder of an action or proceeding (judicial or
otherwise) or an Insolvency Proceeding, the enforcement of any rights against
any property of the Company (including any such enforcement by foreclosure,
repossession or sequestration proceedings), or otherwise -- except when
Majority Senior Creditors shall either request that Lenders join them in
bringing any such proceeding or request that Lenders file claims in connection
with any such proceeding. In addition, the Lenders may, within 90 days prior
to the date on which legal action to collect the Notes would otherwise be
barred by any applicable statute of limitations, commence an action to collect
any payment due on the Notes, provided that (a) no such action shall be
commenced if the Company shall have offered to enter into a tolling agreement
(without conditions other than that such action not be commenced during the
term thereof) which would be effective to prevent such bar and the Lenders
shall have declined to do so, and (b) any recovery by Lenders in any such
action shall be held in trust, segregated, and delivered to Senior Creditors as
described in Section 9.3 hereof.

9.5. INSOLVENCY PROCEEDINGS, POWER OF ATTORNEY.

(a) Upon any distribution of all or any of the assets of the Company,
upon the dissolution, winding up, liquidation or reorganization of the Company
(whether or not in any Insolvency Proceeding), or upon an assignment for the
benefit of creditors or any other marshalling of the assets and liabilities of
the Company, then any payment or distribution of any kind (whether in cash,
securities or other property) which otherwise would be payable or deliverable
upon or with respect to the Subordinated Obligations owed by the Company shall
be paid and delivered directly to Majority Senior Creditors to be applied to
or, at

12
<PAGE> 16
Majority Senior Creditors' option held as collateral for, the pro rata payment
or prepayment of all Senior Obligations.

(b) During the pendency of any Insolvency Proceeding with respect
to the Company, each Lender shall promptly execute, deliver and file any
documents and instruments which Majority Senior Creditors may from time to time
request in order to (i) file appropriate proofs of claim in respect of the
Subordinated Obligations in such Insolvency Proceeding, (ii) instruct any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making any payment or distribution in such Insolvency Proceeding to make all
payments which might otherwise be payable or deliverable in respect of the
Subordinated Obligations directly to Majority Senior Creditors to be applied to
or, at Majority Senior Creditors' option held as collateral for, the pro rata
payment or prepayment of all Senior Obligations, and (iii) otherwise effect the
purposes of this Agreement.

(c) Cumulative of the foregoing, each Lender hereby grants to
Majority Senior Creditors the express power and authority (which power and
authority are coupled with an interest and shall be irrevocable) to do the
following in the name of and on behalf of such Lender whenever any Senior
Obligations are outstanding:

(i) to file appropriate claims (whether by proofs of claim or
otherwise) in any Insolvency Proceeding and to take such other actions
in such Insolvency Proceeding as may be necessary or desirable to
prevent the waiver or release of any claims for Subordinated
Obligations or to enforce the terms of this Agreement.

(ii) to prosecute and enforce such claims in such Insolvency
Proceeding, to initiate and participate in other proceedings to
enforce such Subordinated Obligations, and

to collect and receive any and all such cash or other assets which may
be paid on account of Subordinated Obligations in such Insolvency
Proceeding or in any other proceeding.

(iii) to exercise any vote with respect to Subordinated
Obligations which it may have in any Insolvency Proceeding.

Senior Creditors shall, however, have no duty to the Company or Lenders to
exercise any of the foregoing power and authority, and Senior Creditors may do
so or decline to do so in their sole and absolute discretion.

(d) Lenders may, if Senior Creditors do not elect to do so, file
proofs of claim in any Insolvency Proceeding with respect to the Company in
order to prevent such claims being barred by failure to make a timely filing,
but the prosecution of and collections on such claims shall be subject in all
respects to the provisions of Section 9 of this Agreement.

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<PAGE> 17
9.6. ADDITIONAL AGREEMENTS.

Upon request of the Company, each Lender will enter into an agreement
with the Company and any Senior Creditor or any agent, trustee or other
representative of such Senior Creditor confirming and restating the
subordination provisions of this Section 9 in any form reasonably requested by
such Senior Creditor.

10. REGISTRATION OF THE NOTES.

10.1. REGISTRATION, TRANSFER.

Each Note is a registered note, and the Company shall keep at its
principal executive office a register for any transfer of any Note. At all
times the Person in whose name the Note is so registered shall be deemed and
treated as the owner and holder of the Note for all purposes hereof, and the
Company shall not be affected by any notice or knowledge to the contrary. As
the original holders of the Notes, the Lenders named at the beginning of this
Agreement (in this section called the "Original Lenders") are also receiving
the associated Equity Rights. The Equity Rights may not be transferred without
the prior written consent of the Company, nor may ownership of the Equity
Rights be separated from ownership of the Note. Any transfer of any Note
without the prior written consent of the Company shall, therefore, constitute
an automatic surrender and termination of the Equity Rights to the Company, and
neither the transferor of the Note nor the transferee of the Note shall have
the Equity Rights in such circumstance. Notwithstanding the foregoing,
however, and without any consent of the Company (a) each Original Lender may
transfer all or any portion of any Note and a proportionate share of the Equity
Rights to any Person which is controlling, controlled by, or under common
control with such Original Lender or to a liquidating trust created to hold the
assets of such Original Lender upon its dissolution, and (b) all of the
Original Lenders may transfer all of the Notes and all of the Equity Rights to
a corporation all of whose outstanding capital stock is owned by the Lenders or
by the Lenders together with any future limited partnership that is managed by
Resource Investors Management Company and whose purpose and investor profile is
similar to the Lenders.

10.2. REPLACEMENT OF NOTE.

Upon receipt by the Company of evidence reasonably satisfactory to it
of the ownership of and the loss, theft, destruction or mutilation of any Note
(which evidence shall be, in the case of Lenders, notice from such Lender of
such ownership and such loss, theft, destruction or mutilation), and

(a) in the case of loss, theft or destruction, of
indemnity reasonably satisfactory to it, (provided that such Lender or
such Lender's nominee's own unsecured agreement of indemnity shall be
deemed to be satisfactory), or

(b) in the case of mutilation, upon surrender and
cancellation thereof,

14
<PAGE> 18
the Company at such Lender's expense shall execute and deliver, in lieu
thereof, a new Note, bearing interest from the date to which interest shall
have been paid on such lost, stolen, destroyed or mutilated Note.

11. CONVERSION RIGHTS.

Prior to maturity of the Notes, Lenders are permitted, at their
election, to convert the Principal Balance and Deferred Interest of the Notes
into a twenty percent (20%) equity interest in the Company in accordance with
the terms and conditions of Section 4 of Amendment No. 3 to Agreement of
Limited Partnership dated as of August 24, 1995 executed by Brigham Exploration
Company, General Atlantic Partners III, L.P., GAP-Brigham Partners, L.P.,
Harold D. Carter, Craig Fleming, David T. Brigham and Jon L. Glass (the
"Partnership Agreement Amendment").

12. PAYMENTS ON NOTES.

So long as a Lender or Lender's nominee shall be the Person in whose
name a Note is registered in the register maintained by the Company, and
notwithstanding anything contained in such Note to the contrary, the Company
will pay all sums becoming due on such Note for principal, premium, if any, and
interest by the method and at the address specified for such purpose below such
Lender's name in Schedule A, or by such other reasonable method or at such
other address as such Lender shall have from time to time specified to the
Company in writing for such purpose, without the presentation or surrender of
such Note or the making of any notation thereon, except that upon written
request of the Company made concurrently with or reasonably promptly after
payment or prepayment in full of any Note, such Lender shall surrender such
Note for cancellation, reasonably promptly after any such request, to the
Company at its principal executive office as most recently designated by the
Company. Prior to any sale or other disposition of any Note held by a Lender
or Lender's nominee such Lender will, at its election, either endorse thereon
the amount of principal paid thereon and the last date to which interest has
been paid thereon or surrender such Note to the Company in exchange for a new
Note. The Company will afford the benefits of this Section to any direct or
indirect transferee of any Note purchased by a Lender under this Agreement and
that has made the same agreement relating to such Note as such Lender has made
in this Section.

13. EXPENSES, ETC.

If, and only if, the transactions contemplated hereby are consummated,
the Company will pay all reasonable costs and expenses (including reasonable
attorneys' fees of Lenders' special counsel) incurred by Lenders in connection
with the negotiation and execution of this Agreement and the Equity Rights.

15
<PAGE> 19
14. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or
transfer by any Lender of any Note or portion thereof or interest therein and
the payment of any Note, and may be relied upon by each Lender, regardless of
any investigation made at any time by Lenders or on behalf of Lenders. All
statements contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant to this Agreement shall be deemed
representations and warranties of the Company under this Agreement. Subject to
the preceding sentence, this Agreement, the Notes and the Partnership Agreement
Amendment embody the entire agreement and understanding between Lenders and the
Company and supersede all prior agreements and understandings relating to the
subject matter hereof.

15. AMENDMENT AND WAIVER.

15.1. REQUIREMENTS.

This Agreement and the Notes may be amended, and the observance of any
term hereof or of the Notes may be waived (either retroactively or
prospectively), with (and only with) the written consent of the Company and
Lenders holding sixty-six and two-thirds percent (66 2/3%) of the Principal
Balance.

15.2. BINDING EFFECT, ETC.

Any amendment or waiver consented to as provided in this Section 15
applies to Lenders and is binding upon Lenders and upon the Company without
regard to whether any Note has been marked to indicate such amendment or
waiver. No such amendment or waiver will extend to or affect any obligation,
covenant or agreement not expressly amended or waived or impair any right
consequent thereon. No course of dealing between the Company and any Lender
nor any delay in exercising any rights hereunder or under any Note shall
operate as a waiver of any rights of any Lender.

16. NOTICES.

All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:

(i) if to Lenders, at the address specified for such
communications in Schedule A, or at such other address as such Lender
shall have specified to the Company in writing, or

16
<PAGE> 20
(ii) if to the Company, to the Company at its address set
forth at the beginning hereof to the attention of Craig Fleming, or at
such other address as the Company shall have specified to Lender in
writing.

Notices under this Section 16 will be deemed given only when actually received.

17. CONFIDENTIAL INFORMATION.

For the purposes of this Section, "CONFIDENTIAL INFORMATION" means
information delivered to any Lender (or to the Lenders' representative on the
Company's Management Committee) by or on behalf of the Company or any
Subsidiary, in connection with the transactions contemplated by this Agreement
or in connection with such representative's service on the Company's Management
Committee, that is proprietary in nature, provided that such term does not
include information that was publicly known to such Lender prior to the time of
such disclosure or subsequently becomes publicly known through no act or
omission by such Lender or any person acting on such Lender's behalf. Each
Lender will maintain the confidentiality of such Confidential Information in
accordance with procedures adopted by such Lender in good faith to protect
confidential information of third parties delivered to such Lender, provided
that each Lender may deliver or disclose:

(a) the engineering reports and financial statments described
in Section 7.1(a), (b), and (c) hereof to (i) such Lender's directors,
officers, employees, agents, attorneys, limited partners and
affiliates (to the extent such disclosure reasonably relates to the
administration of the investment represented by such Lender's Note),
(ii) such Lender's financial advisors and other professional advisors
who agree to hold confidential such engineering reports and financial
statements substantially in accordance with the terms of this Section
17, (iii) any other holder of a Note, (iv) any Person to which such
Lender sells or offers to sell such Note or any participation therein
(if such Person has agreed in writing prior to its receipt of such
engineering reports and financial statements to be bound by the
provisions of this Section 17), (v) any federal or state regulatory
authority having jurisdiction over such Lender, to the extent required
to effect compliance with any law, rule, regulation or order
applicable to such Lender, or (vi) in response to any subpoena or
other legal process; and

(b) any other Confidential Information (whether received
pursuant to Section 7.1(d) or otherwise) to those limited partners of
such Lender that (i) have executed a confidentiality agreement in form
and substance reasonably satisfactory to the Managing General Partner
and (ii) are either institutional investors or investors who are not
engaged in any material respect in the oil and gas business.

Each Lender, by its acceptance of its Note, will be deemed to have agreed to be
bound by and to be entitled to the benefits of this Section 17. On reasonable
request by the Company in connection with the delivery to any Person of
information permitted to be delivered to such Person under subsection (a) of
this Section 17, such Person will enter into an agreement with the Company
embodying the provisions of this Section 17.

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<PAGE> 21
18. MISCELLANEOUS.

18.1. SUCCESSORS AND ASSIGNS.

All covenants and other agreements contained in this Agreement by or
on behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any
subsequent holder of any Note) whether so expressed or not.

18.2. PAYMENTS DUE ON NON-BUSINESS DAYS.

Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal, premium, or interest on any Note
that is due on a date other than a Business Day shall be made on the next
succeeding Business Day without including the additional days elapsed in the
computation of the interest payable on such next succeeding Business Day.

18.3. SEVERABILITY.

Any provision of this Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.

18.4. CONSTRUCTION.

Each covenant contained herein shall be construed (absent express
provision to the contrary) as being independent of each other covenant
contained herein, so that compliance with any one covenant shall not (absent
such an express contrary provision) be deemed to excuse compliance with any
other covenant. Where any provision herein refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.

18.5. COUNTERPARTS.

This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of the parties hereto.

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<PAGE> 22
18.6. GOVERNING LAW.

This Agreement shall be construed and enforced in accordance with, and
the rights of the parties shall be governed by, the law of the State of Texas
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.

18.7. LIMITATION ON INTEREST.

Lenders and the Company intend to contract in strict compliance with
applicable usury law from time to time in effect. In furtherance thereof such
Persons stipulate and agree that none of the terms and provisions contained
herein, in the Notes, or in the Partnership Agreement Amendment shall ever be
construed to create a contract to pay, for the use, forbearance or detention of
money, interest in excess of the maximum amount of interest permitted to be
charged by applicable law from time to time in effect. Neither the Company nor
any present or future guarantors, endorsers, or other Persons hereafter
becoming liable for payment of any Obligation owed hereunder or under the Notes
shall ever be liable for unearned interest thereon or shall ever be required to
pay interest thereon in excess of the maximum amount that may be lawfully
charged under applicable law from time to time in effect, and the provisions of
this section shall control over all other provisions of this Agreement, the
Notes and the Partnership Agreement Amendment which may be in conflict or
apparent conflict herewith. If any Lender or any other holder of any or all of
the Obligations hereunder or under any Note shall collect moneys which are
determined to constitute interest which would otherwise increase the interest
on any or all of such Obligations to an amount in excess of that permitted to
be charged by applicable law then in effect, then all sums determined to
constitute interest in excess of such legal limit shall, without penalty, be
promptly applied to reduce the then outstanding principal of the related
Obligations or, at such Lender's or holder's option, promptly returned to the
Company or the other payor thereof upon such determination. In determining
whether or not the interest paid or payable, under any specific circumstance,
exceeds the maximum amount permitted under applicable law, Lenders and the
Company (and any other payors thereof) shall to the greatest extent permitted
under applicable law, (a) characterize any non-principal payment as an expense,
fee or premium rather than as interest, (b) exclude voluntary prepayments and
the effects thereof, and (c) amortize, prorate, allocate, and spread the total
amount of interest throughout the entire contemplated term of this Agreement
and the Notes in accordance with the amounts outstanding from time to time
hereunder and thereunder and the maximum legal rate of interest from time to
time in effect under applicable law in order to lawfully charge the maximum
amount of interest permitted under applicable law. In the event applicable law
provides for an interest ceiling under Texas Revised Civil Statutes Annotated
article 5069-1.04, that ceiling shall be the indicated rate ceiling. As used
in this section the term "applicable law" means the laws of the State of Texas
or the laws of the United States of America, whichever laws allow the greater
interest, as such laws now exist or may be changed or amended or come into
effect in the future.

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<PAGE> 23
18.8. JURISDICTION AND VENUE.

The Company and the Lenders hereby irrevocably and unconditionally
consent to submit to the jurisdiction of the courts of the State of Texas and
of the United States of America located in Harris County, Texas, for any
actions, suits or proceedings arising out of or relating to this Agreement, the
Notes or the transactions contemplated hereby (and each agrees not to commence
any action, suit or proceeding relating thereto except in such courts) and the
Company and the Lenders further agree that service of process, summons, notice
of document by U.S. registered mail to the address of each set forth herein
shall be effective service of process for any action, suit or proceeding
brought against any of them in any such court. The Company and the Lenders
hereby irrevocably and unconditionally waive any objection to the choice of
forum or laying of venue of any action, suit or proceedings arising out of this
agreement or the transactions contemplated thereby, in the courts of the State
of Texas or the United States of America located in Harris County, Texas and
hereby further irrevocably and unconditionally waive and agree not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum. The choice of forum and
laying of venue as set forth in this Section 18.8 was negotiated in good faith
by the Company and the Lenders and is a significant term of the bargain between
the Company and Lenders governed by this Agreement.

18.9. JURY TRIAL WAIVED.

THE COMPANY AND THE LENDERS HEREBY AGREE THAT THEY SHALL AND HEREBY
WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER AT LAW
OR AT EQUITY, BROUGHT BY EITHER OF THEM, OR IN ANY MATTER WHATSOEVER WHICH
ARISES OUT OF OR IS CONNECTED IN ANY WAY WITH THIS AGREEMENT.

* * * * *

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<PAGE> 24
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to
the Company, whereupon the foregoing shall become a binding agreement between
each Lender and the Company.

Very truly yours,

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
Managing General Partner

By:/s/ ANNE L. BRIGHAM
---------------------
Anne L. Brigham, Executive
Vice President
The foregoing is hereby
agreed to as of the
date thereof.

RIMCO PARTNERS, L.P. II
RIMCO PARTNERS, L.P. III
RIMCO PARTNERS, L.P. IV

By: Resource Investors Management
Company Limited Partnership, the
General Partner of each Lender

By: RIMCO Associates, Inc.,
its General Partner

By:/s/ GARY J. MILAVEC
--------------------------------------
Gary J. Milavec, Vice President

<PAGE> 1
EXHIBIT 10.11.1

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR UNDER ANY APPLICABLE STATE SECURITIES LAW. IT MAY NOT BE OFFERED FOR SALE
OR SOLD WITHOUT: (1) REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND ANY APPLICABLE STATE SECURITIES LAWS; OR (2) AN OPINION (SATISFACTORY TO
THE COMPANY) OF COUNSEL THAT REGISTRATION IS NOT REQUIRED.

THIS INSTRUMENT AND THE INDEBTEDNESS OF THE COMPANY EVIDENCED HEREBY ARE
SUBORDINATE TO THE PAYMENT OF INDEBTEDNESS OWED TO THE SENIOR CREDITORS
PURSUANT TO THE TERMS OF THAT CERTAIN NOTE PURCHASE AGREEMENT DATED AS OF
AUGUST 24, 1995 BY AND AMONG THE COMPANY AND LENDERS (AS SUCH TERMS ARE DEFINED
THEREIN).

BRIGHAM OIL & GAS, L.P.

5% CONVERTIBLE SUBORDINATED NOTE DUE SEPTEMBER 1, 2002

No. R-1 August 24, 1995
$5,584,000

FOR VALUE RECEIVED, the undersigned, Brigham Oil & Gas, L.P. (herein
called the "Company"), a limited partnership organized and existing under the
laws of the State of Delaware, hereby promises to pay to RIMCO PARTNERS, L.P.
II, or registered assigns, the principal sum of FIVE MILLION FIVE HUNDRED
EIGHTY-FOUR THOUSAND AND NO/100 DOLLARS ($5,584,000) on September 1, 2002, with
interest (computed on the basis of a 360-day year of twelve 30-day months) on
the unpaid balance thereof at the rate of five percent (5%) per annum from the
date hereof, payable semiannually, on the 1st day of March and September in
each year, commencing with March 1, 1996, until the principal hereof shall have
become due and payable. This Note also evidences the Company's obligation to
pay "Deferred Interest", as such term is defined in the Note Purchase Agreement
referred to below, and such Deferred Interest and any interest thereon shall be
due and payable in accordance with the provisions for "Deferred Interest"
contained in the Note Purchase Agreement referred to below.

Payments of principal of, interest on and any premium with respect to
this Note are to be made in lawful money of the United States of America at the
principal offices of RIMCO Associates, Inc., in Avon, Hartford County,
Connecticut, or at such other place as the Company shall have designated by
written notice to the holder of this Note as provided in the Note Purchase
Agreements referred to below.

This Note is a 5% Convertible Subordinated Note (herein called the
"Note") issued pursuant to the Note Purchase Agreement dated as of August 24,
1995 (as from time to time amended, the "Note Purchase Agreement"), between the
Company and RIMCO PARTNERS, L.P. II,

1
<PAGE> 2
RIMCO PARTNERS, L.P. III, and RIMCO PARTNERS, L.P. IV, and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, to have agreed to the confidentiality provisions set forth in Section
17 of the Note Purchase Agreement.

This Note is a registered Note and, as provided in the Note Purchase
Agreement (and subject to the provisions thereof concerning surrender of the
Equity Rights upon transfers without the Company's prior consent), upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the
registered holder hereof or such holder's attorney duly authorized in writing,
a new Note for a like principal amount will be issued to, and registered in the
name of, the transferee. Prior to due presentment for registration of
transfer, the Company may treat the person in whose name this Note is
registered as the owner hereof for the purpose of receiving payment and for all
other purposes, and the Company will not be affected by any notice to the
contrary.

This Note is subject to optional prepayment, in whole, at the times
and on the terms specified in the Note Purchase Agreement, but not otherwise.
This Note is also convertible into equity interests in the Company as described
in Section 11 of the Note Purchase Agreement.

This Note shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of Texas
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
Managing General Partner

By: /s/ ANNE L. BRIGHAM
-------------------------------
Anne L. Brigham
Executive Vice President

<PAGE> 1
EXHIBIT 10.11.2

BRIGHAM OIL & GAS, L.P.

5% CONVERTIBLE SUBORDINATED NOTE DUE SEPTEMBER 1, 2002

No. R-2 August 24, 1995
$2,800,000

FOR VALUE RECEIVED, the undersigned, Brigham Oil & Gas, L.P. (herein
called the "Company"), a limited partnership organized and existing under the
laws of the State of Delaware, hereby promises to pay to RIMCO PARTNERS, L.P.
III, or registered assigns, the principal sum of TWO MILLION EIGHT HUNDRED
THOUSAND AND NO/100 DOLLARS ($2,800,000) on September 1, 2002, with interest
(computed on the basis of a 360-day year of twelve 30-day months) on the unpaid
balance thereof at the rate of five percent (5%) per annum from the date
hereof, payable semiannually, on the 1st day of March and September in each
year, commencing with March 1, 1996, until the principal hereof shall have
become due and payable. This Note also evidences the Company's obligation to
pay "Deferred Interest", as such term is defined in the Note Purchase Agreement
referred to below, and such Deferred Interest and any interest thereon shall be
due and payable in accordance with the provisions for "Deferred Interest"
contained in the Note Purchase Agreement referred to below.

<PAGE> 2
RIMCO PARTNERS, L.P. III, and RIMCO PARTNERS, L.P. IV, and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, to have agreed to the confidentiality provisions set forth in Section
17 of the Note Purchase Agreement.

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
Managing General Partner

By: /s/ ANNE L. BRIGHAM
-----------------------------
Anne L. Brigham
Executive Vice President

<PAGE> 1
EXHIBIT 10.11.3

BRIGHAM OIL & GAS, L.P.

5% CONVERTIBLE SUBORDINATED NOTE DUE SEPTEMBER 1, 2002

No. R-3 August 24, 1995
$7,616,000

FOR VALUE RECEIVED, the undersigned, Brigham Oil & Gas, L.P. (herein
called the "Company"), a limited partnership organized and existing under the
laws of the State of Delaware, hereby promises to pay to RIMCO PARTNERS, L.P.
IV, or registered assigns, the principal sum of SEVEN MILLION SIX HUNDRED
SIXTEEN THOUSAND AND NO/100 DOLLARS ($7,616,000) on September 1, 2002, with
interest (computed on the basis of a 360-day year of twelve 30-day months) on
the unpaid balance thereof at the rate of five percent (5%) per annum from the
date hereof, payable semiannually, on the 1st day of March and September in
each year, commencing with March 1, 1996, until the principal hereof shall have
become due and payable. This Note also evidences the Company's obligation to
pay "Deferred Interest", as such term is defined in the Note Purchase Agreement
referred to below, and such Deferred Interest and any interest thereon shall be
due and payable in accordance with the provisions for "Deferred Interest"
contained in the Note Purchase Agreement referred to below.

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company,
Managing General Partner

By: /s/ ANNE L. BRIGHAM
-----------------------------
Anne L. Brigham
Executive Vice President

<PAGE> 1
EXHIBIT 10.12

LOAN AGREEMENT

BETWEEN

BRIGHAM OIL & GAS, L.P.,
AS BORROWER
AND
BANK ONE, TEXAS, N.A.,
AS BANK

APRIL 1, 1996

<PAGE> 2
LOAN AGREEMENT
TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
<S> <C> <C>
1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2. Commitments of the Bank . . . . . . . . . . . . . . . . . . . . . . 9
(a) Terms of Revolving Commitment . . . . . . . . . . . . . . . 9
(b) Procedure for Borrowing . . . . . . . . . . . . . . . . . . 9
(c) Letters of Credit . . . . . . . . . . . . . . . . . . . . . 10
(d) Procedure for Obtaining Letters of Credit . . . . . . . . . 10
(e) Voluntary Reduction of Revolving Commitment . . . . . . . . 11
(f) Monthly Commitment Reduction . . . . . . . . . . . . . . . . 11

3. Note Evidencing Loans . . . . . . . . . . . . . . . . . . . . . . . 11
(a) Form of Note . . . . . . . . . . . . . . . . . . . . . . . . 11
(b) Interest Rate . . . . . . . . . . . . . . . . . . . . . . . 12
(c) Payment of Interest . . . . . . . . . . . . . . . . . . . . 12
(d) Payment of Principal . . . . . . . . . . . . . . . . . . . . 12

4. Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(a) Options . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(b) Interest Rate Determination . . . . . . . . . . . . . . . . 13
(c) Conversion Option . . . . . . . . . . . . . . . . . . . . . 13
(d) Recoupment . . . . . . . . . . . . . . . . . . . . . . . . . 13
(e) Default Rate . . . . . . . . . . . . . . . . . . . . . . . . 14

5. Special Provisions Relating to Eurodollar Loans. . . . . . . . . . 14
(a) Unavailability of Funds or Inadequacy of Pricing . . . . . . 14
(b) Reserve Requirements . . . . . . . . . . . . . . . . . . . . 14
(c) Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
(d) Change in Laws . . . . . . . . . . . . . . . . . . . . . . . 15
(e) Option to Fund . . . . . . . . . . . . . . . . . . . . . . . 15
(f) Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . 16
(g) Payments Not at End of Interest Period . . . . . . . . . . . 16

6. Collateral Security . . . . . . . . . . . . . . . . . . . . . . . . 16

7. Borrowing Base . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(a) Initial Borrowing Base . . . . . . . . . . . . . . . . . . . 17
(b) Subsequent Determinations of Borrowing Base . . . . . . . . 17
</TABLE>

i
<PAGE> 3
<TABLE>
<S> <C> <C>
8. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(a) Origination Fee . . . . . . . . . . . . . . . . . . . . . . 19
(b) Unused Portion Fee . . . . . . . . . . . . . . . . . . . . . 19
(c) Borrowing Base Increase Fee . . . . . . . . . . . . . . . . 19
(d) Letter of Credit Fee . . . . . . . . . . . . . . . . . . . . 19

9. Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(a) Voluntary Prepayments . . . . . . . . . . . . . . . . . . . 19
(b) Mandatory Prepayment . . . . . . . . . . . . . . . . . . . . 19

10. Representations and Warranties . . . . . . . . . . . . . . . . . . 20
(a) Partnership Existence . . . . . . . . . . . . . . . . . . . 20
(b) Authority of Managing General Partner . . . . . . . . . . . 20
(c) Binding Obligations . . . . . . . . . . . . . . . . . . . . 20
(d) No Legal Bar or Resultant Lien . . . . . . . . . . . . . . . 20
(e) No Consent . . . . . . . . . . . . . . . . . . . . . . . . . 21
(f) Financial Condition . . . . . . . . . . . . . . . . . . . . 21
(g) Liabilities . . . . . . . . . . . . . . . . . . . . . . . . 21
(h) Litigation . . . . . . . . . . . . . . . . . . . . . . . . . 21
(i) Taxes; Governmental Charges . . . . . . . . . . . . . . . . 21
(j) Titles, Etc. . . . . . . . . . . . . . . . . . . . . . . . . 22
(k) Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(l) Casualties; Taking of Properties . . . . . . . . . . . . . . 22
(m) Use of Proceeds; Margin Stock . . . . . . . . . . . . . . . 22
(n) Location of Business and Offices . . . . . . . . . . . . . . 22
(o) Compliance with the Law . . . . . . . . . . . . . . . . . . 23
(p) No Material Misstatements . . . . . . . . . . . . . . . . . 23
(q) Not A Utility . . . . . . . . . . . . . . . . . . . . . . . 23
(r) ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(s) Environmental Matters . . . . . . . . . . . . . . . . . . . 23
(t) Ownership of Borrower . . . . . . . . . . . . . . . . . . . 24
(u) Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

11. Conditions of Lending . . . . . . . . . . . . . . . . . . . . . . . 24

12. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . 26
(a) Financial Statements and Reports . . . . . . . . . . . . . . 27
(b) Certificates of Compliance . . . . . . . . . . . . . . . . . 28
(c) Taxes and Other Liens . . . . . . . . . . . . . . . . . . . 28
(d) Compliance with Laws . . . . . . . . . . . . . . . . . . . . 29
(e) Further Assurances . . . . . . . . . . . . . . . . . . . . . 29
(f) Performance of Obligations . . . . . . . . . . . . . . . . . 29
(g) Insurance . . . . . . . . . . . . . . . . . . . . . . . . . 29
(h) Accounts and Records . . . . . . . . . . . . . . . . . . . . 30
</TABLE>

ii
<PAGE> 4
<TABLE>
<S> <C> <C>
(i) Right of Inspection . . . . . . . . . . . . . . . . . . . . 30
(j) Notice of Certain Events . . . . . . . . . . . . . . . . . . 30
(k) ERISA Information and Compliance . . . . . . . . . . . . . . 31
(l) Environmental Reports and Notices . . . . . . . . . . . . . 31
(m) Maintenance . . . . . . . . . . . . . . . . . . . . . . . . 31
(n) Operation of Properties . . . . . . . . . . . . . . . . . . 32
(o) Compliance with Leases and Other Instruments . . . . . . . . 32
(p) Certain Additional Assurances Regarding Maintenance and
Operations of Properties . . . . . . . . . . . . . . . . . . 33
(q) Sale of Certain Assets/Prepayment of Proceeds . . . . . . . 33
(r) Title Matters . . . . . . . . . . . . . . . . . . . . . . . 33
(s) Curative Matters . . . . . . . . . . . . . . . . . . . . . . 34
(t) Change of Principal Place of Business . . . . . . . . . . . 34
(u) Bank Accounts . . . . . . . . . . . . . . . . . . . . . . . 34
(v) Additional Collateral . . . . . . . . . . . . . . . . . . . 35

13. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . 35
(a) Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
(b) Current Ratio . . . . . . . . . . . . . . . . . . . . . . . 35
(c) Debt Service Coverage Ratio . . . . . . . . . . . . . . . . 35
(d) Debts, Guaranties and Other Obligations . . . . . . . . . . 35
(e) Loans and Advances . . . . . . . . . . . . . . . . . . . . . 36
(f) Nature of Business . . . . . . . . . . . . . . . . . . . . . 36
(g) Hedging Transactions . . . . . . . . . . . . . . . . . . . . 37
(h) Sale of Assets . . . . . . . . . . . . . . . . . . . . . . . 37
(i) Transactions with Affiliates . . . . . . . . . . . . . . . . 37
(j) Consolidations and Mergers . . . . . . . . . . . . . . . . . 37
(k) Distributions . . . . . . . . . . . . . . . . . . . . . . . 37
(l) Investments . . . . . . . . . . . . . . . . . . . . . . . . 38
(m) Amendment of Partnership Agreement . . . . . . . . . . . . . 38
(n) Payment of Subordinated Debt . . . . . . . . . . . . . . . . 38
(o) Amendment of Subordinated Debt Agreement . . . . . . . . . . 38
(p) Sale or Discount of Receivable . . . . . . . . . . . . . . . 39

14. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . 39

15. Exercise of Rights . . . . . . . . . . . . . . . . . . . . . . . . 41

16. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

17. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

18. Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
</TABLE>

iii
<PAGE> 5
<TABLE>
<S> <C> <C>
19. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

20. Choice of Forum: Consent to Service of Process and Jurisdiction . . 43

21. Invalid Provisions . . . . . . . . . . . . . . . . . . . . . . . . 44

22. Maximum Interest Rate . . . . . . . . . . . . . . . . . . . . . . . 44

23. Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

24. Multiple Counterparts . . . . . . . . . . . . . . . . . . . . . . . 45

25. Conflict . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

26. Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

27. Parties Bound . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

28. Participations . . . . . . . . . . . . . . . . . . . . . . . . . . 45

29. Financial Terms . . . . . . . . . . . . . . . . . . . . . . . . . . 46

30. Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . 46
</TABLE>

iv
<PAGE> 6
Exhibits

Exhibit "A" - Notice of Borrowing
Exhibit "B" - Note
Exhibit "C" - Certificate of Compliance

Schedules

Schedule 1 - Ownership of Borrower
Schedule 2 - Liens
Schedule 3 - Financial Condition
Schedule 4 - Liabilities
Schedule 5 - Litigation
Schedule 6 - Environmental Matters
Schedule 7 - Form of Report on Properties
Schedule 8 - Curative Matters
Schedule 9 - Loans and Advances

Annexes

Annex 1 - Negative Pledge Properties

v
<PAGE> 7
LOAN AGREEMENT

THIS LOAN AGREEMENT (hereinafter referred to as the "Agreement")
executed as of the 1st day of April, 1996, by and between BRIGHAM OIL & GAS,
L.P., a Delaware limited partnership (hereinafter referred to as the
"Borrower") and BANK ONE, TEXAS, N.A., a national banking association
(hereinafter sometimes referred to as "Bank").

W I T N E S S E T H:

WHEREAS, Borrower has requested that the Bank provide Borrower with a
reducing revolving loan facility and the Bank is willing to make such facility
available to Borrower in amounts of up to $25,000,000 on the terms and
conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:

1. DEFINITIONS. When used herein the terms "Agreement," "Borrower"
and "Bank" shall have the meanings indicated above. When used herein the
following terms shall have the following meanings (all terms defined in this
Section 1 or other provisions of this Agreement in the singular shall have the
same meanings when used in the plural or vice versa):

"Advance or Advances" shall mean a loan or loans hereunder.

"Affiliate" shall mean any Person which, directly or indirectly,
controls, is controlled by or is under common control with the relevant
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common
control with"), as used with respect to any Person, shall mean a member
of the board of directors, a partner or an officer of such Person, or
any other Person with possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of such
Person, through the ownership (of record, as trustee, or by proxy) of
voting shares, partnership interests or voting rights, through a
management contract or otherwise. Any Person owning or controlling
directly or indirectly more than twenty percent of the voting shares,
partnership interests or voting rights, or other equity interest of
another Person shall be deemed to be an Affiliate of such Person.

"Base Rate" shall mean the fluctuating rate of interest per annum
established from time to time by Bank as its Base Rate (which rate of
interest may not be the lowest, best or most favorable rate of interest
which Bank may charge on loans to its customers). Each change in the
Base Rate shall become effective without prior notice to Borrower
automatically as of the opening of business on the date of such change
in the Base Rate.
<PAGE> 8
"Base Rate Interest Period" shall mean, with respect to any Base
Rate Loan, the period ending on the first day of each month, provided,
however, that (i) if any Base Rate Interest Period would end on a day
which is not a Business Day, such Interest Period shall be extended to
the next succeeding Business Day, and (ii) if any Base Rate Interest
Period would otherwise end after the Maturity Date such Interest Period
shall end on the Maturity Date.

"Base Rate Loans" shall mean any loan during any period which
bears interest based upon the Base Rate or which would bear interest
based upon the Base Rate if the Maximum Rate ceiling was not in effect
at that particular time.

"Borrowing Base" shall mean the value assigned by the Bank from
time to time to the Collateral in accordance with Section 7(b) hereof.
Until the next determination of the Borrowing Base pursuant to Section
7(b) hereof the Borrowing Base for the Revolving Commitment shall be
$6,200,000.00.

"Borrowing Date" shall mean the date elected by the Borrower
pursuant to Section 2(b) hereof for an Advance on the Revolving Loan.

"Business Day" shall mean the normal banking hours during any day
(other than Saturdays or Sundays) that banks are legally open for
business in Dallas, Texas.

"Change of Control" shall mean a Change of Control shall occur if
there is any change in the ownership of the general partnership interest
in Borrower owned by Brigham Exploration Company as of the Effective
Date as such ownership is shown on Schedule "1" hereto except such
changes in ownership as contemplated by that certain Note Purchase
Agreement dated August 24, 1995, among Borrower, RIMCO Partners, L.P.
II, RIMCO Partners, L.P. III and RIMCO Partners, L.P. IV (the
"Subordinated Debt Agreement").

"Change of Management" shall mean a Change of Management shall
occur if Ben M. Brigham ceases to act as Chief Executive Officer of
Borrower.

"Collateral" is used herein as defined in Section 6 hereof.

"Current Assets" shall mean the total of Borrower's current
assets as determined in accordance with GAAP, plus, as of any date, the
current unused availability under the Revolving Commitment.

-2-
<PAGE> 9
"Current Liabilities" shall mean the total of Borrower's current
liabilities as determined in accordance with GAAP, excluding therefrom,
as of any date, current maturities on the Revolving Loan.

"Debt Service" shall mean, for any fiscal quarter, the total of
the Monthly Commitment Reductions for such quarter plus all interest
expense paid by Borrower during such quarter.

"Effective Date" shall mean the date of this Agreement.

"Environmental Laws" shall mean the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the
Super Fund Amendments and Reauthorization Act of 1986, 42 U.S.C.A.
Section 9601, et seq., the Resource Conservation and Recovery Act, as
amended by the Hazardous Solid Waste Amendment of 1984, 42 U.S.C.A.
Section 6901, et seq., the Clean Air Act, 42 U.S.C.A. Section 1251, et
seq., the Toxic Substances Control Act, 15 U.S.C.A. Section 2601, et
seq., The Oil Pollution Act of 1990, 33 U.S.G. Section 2701, et seq.,
and all other laws, statutes, codes, acts, ordinances, orders,
judgments, decrees, injunctions, rules, regulations, order and
restrictions of any federal, state, county, municipal and other
governments, departments, commissions, boards, agencies, courts,
authorities, officials and officers, domestic or foreign, relating to
air pollution, water pollution, noise control and/or the handling,
discharge, disposal or recovery of on-site or off-site asbestos or
"hazardous substances" as defined by 42 U.S.C. Section 9601, et seq.,
as amended, as each of the foregoing may be amended from time to time.

"Environmental Liability" shall mean any claim, demand,
obligation, cause of action, accusation, allegation, order, violation,
damage, injury, judgment, penalty or fine, cost of enforcement, cost of
remedial action or any other costs or expense whatsoever, including
reasonable attorneys' fees and disbursements, resulting from the
violation or alleged violation of any Environmental Law or the
imposition of any Environmental Lien (as hereinafter defined) which
could reasonably be expected to individually or in the aggregate have a
Material Adverse Effect.

"Environmental Lien" shall mean a Lien in favor of any court,
governmental agency or instrumentality or any other Person (i) for any
Environmental Liability or (ii) for damages arising from or cost
incurred by such court or governmental agency or instrumentality or
other person in response to a release or threatened release of hazardous
or toxic waste, substance or constituent into the environment, the
imposition of which could reasonably be expected to have a Material
Adverse Effect.

-3-
<PAGE> 10
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.

"Eurodollar Interest Period" shall mean with respect to any
Eurodollar Loan (i) initially, the period commencing on the date such
Eurodollar Loan is made and ending one (1), two (2), three (3) or six
(6) months thereafter as selected by the Borrower pursuant to Section
4(a)(ii), and (ii) thereafter, each period commencing on the day
following the last day of the next preceding Interest Period applicable
to such Eurodollar Loan and ending one (1), two (2), three (3) or six
(6) months thereafter, as selected by the Borrower pursuant to Section
4(a)(ii); provided, however, that (i) if any Eurodollar Interest Period
would otherwise expire on a day which is not a Eurodollar Business Day,
such Interest Period shall expire on the next succeeding Eurodollar
Business Day unless the result of such extension would be to extend such
Interest Period into the next calendar month, in which case such
Interest Period shall end on the immediately preceding Eurodollar
Business Day, (ii) if any Eurodollar Interest Period begins on the last
Eurodollar Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of
such Interest Period) such Interest Period shall end on the last
Eurodollar Business Day of a calendar month, and (iii) any Eurodollar
Interest Period which would otherwise expire after the Maturity Date
shall end on such Maturity Date.

"Eurodollar Loan" shall mean any loan during any period which
bears interest at the Eurodollar Rate, or which would bear interest at
such rate if the Maximum Rate ceiling was not in effect at a particular
time.

"Eurodollar Margin" shall mean the fluctuating Eurodollar Margin
in effect from day to day shall be:

(i) two and one-quarter percent (2.25%) per annum
whenever the Total Outstandings are greater than 75% of the
Borrowing Base in effect at the time in question, reducing to two
percent (2%) per annum when the Borrowing Base is equal to or
greater than sixteen million dollars;

(ii) two percent (2.0%) per annum whenever the Total
Outstandings are greater than 50%, but less than or equal to 75%,
of the Borrowing Base in effect at the time in question, reducing
to one and three-quarters percent (1.75%) per annum when the
Borrowing Base is equal to or greater than sixteen million
dollars; or

(iii) one and three-quarter percents (1.75%) per annum
whenever the Total Outstandings are 50% or less of the Borrowing
Base in effect at the

-4-
<PAGE> 11
time in question, reducing to one and one-half percent (1.5%)
per annum when the Borrowing Base is equal to or greater than
sixteen million dollars.

"Eurodollar Rate" shall mean with respect to each Eurodollar
Interest Period, the rate of interest per annum at which deposits in
immediately available and freely transferable funds in U.S. Dollars are
offered to the Bank (at approximately 10:00 a.m., Dallas, Texas time
three Eurodollar Business Days prior to the first day of each Eurodollar
Interest Period) in the London interbank market for delivery on the
first day of such Eurodollar Interest Period in an amount equal to or
comparable to the principal amount of the Eurodollar Loan to which such
Eurodollar Interest Period relates. Each determination of the
Eurodollar Rate by the Bank shall, in the absence of error, be
conclusive and binding.

"Financial Statements" shall mean balance sheets, income
statements, statements of cash flow and appropriate footnotes, prepared
in accordance with GAAP.

"GAAP" shall mean generally accepted accounting principles,
consistently applied.

"Interest Payment Date" shall mean for Base Rate Loans the
earlier of (i) the last day of each Base Rate Interest Period and for
Eurodollar Loans the last day of each Eurodollar Interest Period or if
such Eurodollar Interest is six (6) months, the last day successive
three (3) month periods.

"Interest Period" shall mean any Base Rate Interest Period, or
Eurodollar Interest Period.

"Letters of Credit" is used herein as defined in Section 2(c).

"Lien" shall mean any mortgage, deed of trust, pledge, security
interest, assignment or lien (statutory or otherwise) of every kind and
character.

"Loan Documents" shall mean this Agreement, the Note, the
Security Instruments and all other documents executed in connection with
the transaction described in this Agreement.

"Lockbox Account" shall mean a lockbox account maintained by
Borrower at Bank in accordance with the provisions of Section 12(u) of
this Agreement.

"Material Adverse Effect" shall mean any circumstances or events
which could have a material adverse effect on (i) the assets or
properties, liabilities, financial

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<PAGE> 12
condition, business, operations, affairs or circumstances of Borrower as
reflected in the Financial Statements of Borrower or from the facts
represented or warranted in this Agreement or any other Loan Document
(other than any representation or warranty related solely to a different
point in time), or (ii) the ability of Borrower to carry out its
business as it exists on the date of this Agreement or as proposed at
the date of this Agreement to be conducted or to meet its obligations
under the Note, this Agreement or the other Loan Documents on a timely
basis.

"Maturity Date" shall mean March 31, 1999.

"Maximum Rate" shall mean at any particular time in question, the
maximum rate of interest which under applicable law may then be charged
on the Note. If such maximum rate changes after the date hereof, the
Maximum Rate shall be automatically increased or decreased, as the case
may be, without notice to Borrower from time to time as the effective
date of each change in such maximum rate. If the applicable law ceases
to provide for a maximum rate of interest, the Maximum Rate shall be
equal to eighteen percent (18%) per annum.

"Monthly Commitment Reduction" is used herein as defined in
Section 2(f) herein.

"Net Cash Flow" shall mean net income plus depreciation,
depletion, amortization and other non-cash charges, excluding gains or
losses from the sale of capital assets, less any distributions paid
pursuant to Section 13(k) hereof, plus interest expense paid, all
calculated in accordance with GAAP, as of the end of each fiscal
quarter.

"Note" shall mean the $25,000,000 note described in Section 3
hereof, together with all renewals and extensions thereof or any part
thereof.

"Oil and Gas Properties" shall mean all oil, gas and mineral
properties and interests and related personal properties in which
Borrower grants to Bank either a first and prior lien and security
interest pursuant to Section 6 hereof or a negative pledge pursuant to
Section 13 hereof on the oil and gas properties listed and described in
Annex 1 hereto.

"Operating Accounts" shall mean Borrower's demand deposit
accounts, established and maintained by Borrower at Bank in accordance
with the provisions of Section 12(u) of this Agreement.

"Permitted Liens" shall mean (i) royalties, overriding royalties,
reversionary interests, production payments and similar burdens; (ii)
sales contracts or other

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<PAGE> 13
arrangements for the sale of production of oil, gas or associated liquid
or gaseous hydrocarbons which would not (when considered cumulatively
with the matters discussed in clause (i) above) deprive the Borrower of
any material right in respect of the Borrower's assets or properties
(except for rights customarily granted with respect to such contracts
and arrangements); (iii) statutory Liens for taxes or other assessments
that are not yet delinquent (or that, if delinquent, are being contested
in good faith by appropriate proceedings, levy and execution thereon
having been stayed and continue to be stayed and for which the Borrower
has set aside on its books adequate reserves in accordance with GAAP);
(iv) easements, rights of way, servitudes, permits, surface leases and
other rights in respect to surface operations, pipelines, grazing,
logging, canals, ditches, reservoirs or the like, conditions, covenants
and other restrictions, and easements of streets, alleys, highways,
pipelines, telephone lines, power lines, railways and other easements
and rights of way on, over or in respect of the Borrower's assets or
properties and that do not individually or in the aggregate, cause a
Material Adverse Effect; (v) materialmen's, mechanic's, repairman's,
employee's, warehousemen's, landlord's, carrier's, pipeline's,
contractor's, sub-contractor's, operator's, non-operator's (arising
under operating or joint operating agreements or otherwise), and other
Liens (including any financing statements filed in respect thereof)
incidental to obligations incurred by the Borrower in connection with
the construction, maintenance, development, transportation, storage or
operation of the Borrower's assets or properties to the extent not
delinquent (or which, if delinquent, are being contested in good faith
by appropriate proceedings and for which the Borrower has set aside on
its books adequate reserves in accordance with GAAP); (vi) all
contracts, agreements and instruments, and all defects and
irregularities and other matters affecting the Borrower's assets and
properties which were in existence at the time the Borrower's assets and
properties were originally acquired by the Borrower and all operational
agreements entered into in the ordinary course of business, which
contracts, agreements, instruments, defects, irregularities and other
matters and operational agreements are not such as, individually or in
the aggregate, could reasonably be expected to have a Material Adverse
Effect; (vii) liens in connection with workmen's compensation,
unemployment insurance or other social security, old age pension or
public liability obligations; (viii) legal or equitable encumbrances
deemed to exist by reason of the existence of any litigation or other
legal proceeding or arising out of a judgment or award with respect to
which an appeal is being prosecuted in good faith and levy and execution
thereon have been stayed and continue to be stayed; (ix) rights reserved
to or vested in any municipality, governmental, statutory or other
public authority to control or regulate the Borrower's assets and
properties in any manner, and all applicable laws, rules and orders from
any governmental authority; (x) landlord's liens; (xi) Liens incurred
pursuant to the Security Instruments; and (xii) Liens existing at the
date of this Agreement which have been disclosed to Bank in the
Borrower's December 31, 1995 Financial Statements or

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<PAGE> 14
identified in Schedule "2" hereto; (xiii) matters disclosed in, or on
any exhibit to, a Security Instrument; (xiv) Liens securing indebtedness
permitted by Section 13(d)(iv) hereof; and (xv) any and all renewals and
extensions of all or any of the foregoing.

"Person" shall mean an individual, a corporation, a partnership,
an association, a trust or any other entity or organization, including a
government or political subdivision or an agency or instrumentality
thereof.

"Plan" shall mean any plan subject to Title IV of ERISA and
maintained by Borrower, or any such plan to which Borrower is required
to contribute on behalf of its employees.

"Reimbursement Obligations" shall mean, as of any date, the
obligations of the Borrower with respect to all Letters of Credit then
outstanding to reimburse amounts paid by the Bank in respect of any
drawing or drawings under any of such Letter of Credit.

"Revolving Commitment" shall mean the lesser of (i) $25,000,000
or (ii) the Borrowing Base, as reduced from time to time pursuant to
Sections 2(e) and 2(f) hereof.

"Revolving Loan" shall mean the loan or loans made under the
Revolving Commitment pursuant to Section 2 hereof.

"Security Instruments" shall mean this Agreement, all Deeds of
Trust, Mortgages, Security Agreements, Assignments of Production and
Financing Statements, and other collateral documents covering Borrower's
Oil and Gas Properties and related personal property, equipment, oil and
gas inventory and proceeds of the foregoing, all such documents to be in
form and substance reasonably satisfactory to Bank.

"Total Outstandings" shall mean as of any date, the sum of (i)
the total principal balance outstanding of the Note, plus (ii) the then
total undrawn amount of all outstanding Letters of Credit plus (iii) the
total amount of all unpaid Reimbursement Obligations.

"Tranche" shall mean a Eurodollar Loan or Base Rate Loan.

"Unscheduled Redeterminations" shall mean a redetermination of
the Borrowing Base made at any time other than on the dates set for the
regular semi-annual redetermination of the Borrowing Base which are made
(A) at the

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<PAGE> 15
reasonable request of Borrower, (B) at any time it appears to the Bank,
in the exercise of its reasonable discretion, that either (i) there has
been a material decrease in the value of the Oil and Gas Properties, or
(ii) an event has occurred which is reasonably expected to have a
Material Adverse Effect.

2. COMMITMENTS OF THE BANK.

(a) Terms of Revolving Commitment. On the terms and
conditions hereinafter set forth, Bank agrees to make Advances to the
Borrower from time to time during the period beginning on the Closing
Date and ending on the Maturity Date in such amounts as the Borrower may
request up to an amount not to exceed, in the aggregate principal amount
outstanding at any time, the Revolving Commitment. The obligation of
the Borrower hereunder shall be evidenced by this Agreement and the Note
issued in connection herewith, said Note to be as described in Section 3
hereof. Notwithstanding any other provision of this Agreement, no
Advance shall be required to be made hereunder if any Event of Default
(as hereinafter defined) has occurred and is continuing or if any event
or condition has occurred or failed to occur which with the passage of
time or service of notice, or both, would constitute an Event of
Default. Each Advance under the Revolving Commitment shall be an
aggregate amount of at least $100,000 or a whole number multiple
thereof. Irrespective of the face amount of the Note, the Bank shall
never have the obligation to Advance any amount or amounts in excess of
the Borrowing Base or to increase the Revolving Commitment. The total
number of Tranches which may be outstanding at any time hereunder shall
never exceed four (4), whether such Tranches are Base Rate Loans,
Eurodollar Loans, or a combination thereof.

(b) Procedure for Borrowing. Whenever the Borrower desires an
Advance hereunder, it shall give Bank telegraphic, telex, facsimile or
telephonic notice ("Notice of Borrowing") of such requested Advance,
which in the case of telephonic notice, shall be promptly confirmed in
writing. Each Notice of Borrowing shall be in the form of Exhibit "A"
attached hereto and shall be received by Bank not later than 11:00 a.m.
Dallas, Texas time, (i) one Business Day prior to the Borrowing Date in
the case of the Base Rate Loan, or (ii) three Business Days prior to any
proposed Borrowing Date in the case of Eurodollar Loans. Each Notice of
Borrowing shall specify (i) the Borrowing Date (which, if at Base Rate
Loan, shall be a Business Day and if a Eurodollar Loan, a Eurodollar
Business Day), (ii) the principal amount to be borrowed, (iii) the
portion of the Advance constituting Base Rate Loans and/or Eurodollar
Loans, (iv) if any portion of the proposed Advance is to constitute
Eurodollar Loans, the initial Interest Period selected by Borrower
pursuant to Section 4 hereof to be applicable thereto, and (v) the date
upon which such Advance is required.

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<PAGE> 16
(c) Letters of Credit. On the terms and conditions
hereinafter set forth, the Bank shall from time to time during the
period beginning on the Closing Date and ending on the Maturity Date
upon request of Borrower issue standby Letters of Credit for the account
of Borrower (the "Letters of Credit") in such face amounts as Borrower
may request, but not to exceed in the aggregate face amount at any time
outstanding the sum of One Million Dollars ($1,000,000.00) or such
amount as designated by Bank in writing. The face amount of all Letters
of Credit issued and outstanding hereunder shall be considered as
Advances for Borrowing Base purposes and all payments made by the Bank
on such Letters of Credit shall be considered as Advances under the
Note. Each Letter of Credit issued for the account of Borrower
hereunder shall (i) be in favor of such beneficiaries as specifically
requested by Borrower, (ii) have an expiration date not exceeding the
Maturity Date, and (iii) contain such other terms and provisions as may
reasonably be required by Bank. The Borrower hereby unconditionally
agrees to pay and reimburse the Bank for account of the Bank for the
amount of each demand for payment under any Letter of Credit that is in
compliance with the provisions of any such Letter of Credit at or prior
to the date on which payment is to be made by the Bank to the
beneficiary thereunder, without presentment, demand, protest or other
formalities of any kind. Upon receipt from any beneficiary of any
Letter of Credit of any demand for payment under such Letter of Credit,
the Bank shall promptly notify the Borrower of the demand and the date
upon which such payment is to be made by the Bank to such beneficiary in
respect of such demand. Forthwith upon receipt of such notice from the
Bank, Borrower shall advise the Bank whether or not they intend to
borrow hereunder to finance their obligations to reimburse the Bank, and
if so, submit a Notice of Borrowing as provided in Section 2(b) hereof.

(d) Procedure for Obtaining Letters of Credit. The amount and
date of issuance, renewal, extension or reissuance of a Letter of Credit
pursuant to the Bank's commitment above in Section 2(c) shall be
designated by Borrower's written request delivered to Bank at least
three (3) Business Days prior to the date of such issuance, renewal,
extension or reissuance. Concurrently with or promptly following the
delivery of the request for a Letter of Credit, Borrower shall execute
and deliver to the Bank an application and agreement with respect to the
Letters of Credit, said application and agreement to be in the form used
by the Bank. The Bank shall not be obligated to issue, renew, extend or
reissue such Letters of Credit if (A) the amount thereon when added to
the amount of the outstanding Letters of Credit exceeds One Million
Dollars ($1,000,000.00) or such amount as designated by Bank in writing
(B) the amount thereof when added to the Total Outstandings would exceed
the Revolving Commitment. Borrower agrees to pay the Bank commissions
for issuing the Letters of Credit (calculated separately for each Letter
of Credit) in an amount equal to the greater of (i) one percent (1%) per
annum on the maximum face amount of the Letter of Credit or (ii)
$400.00. Such commissions shall be

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<PAGE> 17
payable prior to the issuance of each Letter of Credit and thereafter on
each anniversary date of such issuance while such Letter of Credit is
outstanding. In addition, any amendment to any Letter of Credit shall
be subject to a $50 amendment fee due on the date of such amendment.

(e) Voluntary Reduction of Revolving Commitment. The Borrower
may at any time, or from time to time, upon not less than three (3)
Business Days prior written notice to Bank, reduce or terminate the
Revolving Commitment; provided, however, that (i) each reduction in the
Revolving Commitment must be in the amount of $100,000 or more, in
increments of $100,000 and (ii) each reduction must be accompanied by a
prepayment of the Note in the amount by which the outstanding principal
balance of the Note exceeds the Revolving Commitment as reduced pursuant
to this Section 2.

(f) Monthly Commitment Reduction. The Revolving Commitment
shall be reduced as of the first day of each month beginning on the
first day of the first month after the Closing Date by an amount
determined by the Bank pursuant to Section 7(b) hereof (the "Monthly
Commitment Reduction"). The Monthly Commitment Reduction shall be $0
per month until redetermined pursuant to Section 7(b) hereof. If, as a
result of the Monthly Commitment Reduction required pursuant to this
Section 2(f), the Total Outstandings ever exceed the Borrowing Base,
Borrower shall within five (5) days of receipt of notice thereof,
prepay, without penalty or premium, the principal amount of the Note in
an amount at least equal to such excess plus interest thereon to the
date of such prepayment.

3. NOTE EVIDENCING LOANS. The loans described above in Section 2
shall be evidenced by a promissory note of Borrower as follows:

(a) Form of Note - The Revolving Loan shall be evidenced by a
Note in the face amount of $25,000,000, and shall be in the form of
Exhibit "B" hereto with appropriate insertion. Notwithstanding the
principal amount of the Note, as stated on the face thereof, the actual
principal amount due from Borrower to Bank on account of the Note, as of
any date of computation, shall be the sum of Advances then and
theretofore made on account thereof, less all principal payments
actually received by Bank in collected funds with respect thereto.
Although the Note shall be dated as of the Effective Date, interest in
respect thereof shall be payable only for the period during which the
loans evidenced thereby are outstanding and, although the stated amount
of the Note may be higher, the Note shall be enforceable, with respect
to Borrower's obligation to pay the principal amount thereof, only to
the extent of the unpaid principal amount of the loans.

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<PAGE> 18
(b) Interest Rate - The unpaid principal balance of the Note
shall bear interest from time to time as set forth in Section 4 hereof.

(d) Payment of Principal - Principal of the Note shall be due
on the Maturity Date, unless earlier due in whole or in part pursuant to
the mandatory prepayment provisions of Sections 2(f) and 9(b) hereof.

4. INTEREST RATES.

(a) Options.

(i) Base Rate Loans. Borrower agrees to pay interest
on the Note calculated on the basis of the actual days elapsed in
a year consisting of 365 or, if appropriate, 366 days with
respect to the unpaid principal amount of each Base Rate Loan
from the date the proceeds thereof are made available to Borrower
until maturity (whether by acceleration or otherwise), at a
varying rate per annum equal to the lesser of (i) the Maximum
Rate (defined herein), or (ii) the Base Rate. Subject to the
provisions of this Agreement as to prepayment, the principal of
the Note representing Base Rate Loans shall be payable as
specified in Section 3(d) hereof and the interest in respect of
each Base Rate Loan shall be payable on each Interest Payment
Date. Past due principal and, to the extent permitted by law,
past due interest in respect to each Base Rate Loan, shall bear
interest, payable on demand, at a rate per annum equal to the
Default Rate (as hereinafter defined).

(ii) Eurodollar Loans. Borrower agrees to pay interest
calculated on the basis of a year consisting of 360 days with
respect to the unpaid principal amount of each Eurodollar Loan
from the date the proceeds thereof are made available to Borrower
until maturity (whether by acceleration or otherwise), at a
varying rate per annum equal to the lesser of (i) the Maximum
Rate, or (ii) the Eurodollar Rate plus the Eurodollar Margin.
Subject to the provisions of this Agreement with respect to
prepayment, the principal of the Note shall be payable as
specified in Section 3(d) hereof and the interest with respect to
each Eurodollar Loan shall be payable on each Interest Payment
Date. Past due principal and, to the extent permitted by law,
past due interest shall bear interest, payable on demand, at a
rate

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<PAGE> 19
per annum equal to the Default Rate. Upon three (3) Eurodollar
Business Days' written notice prior to the making by the Bank of
any Eurodollar Loan (in the case of the initial Interest Period
therefor) or the expiration date of each succeeding Interest
Period (in the case of subsequent Interest Periods therefor),
Borrower shall have the option, subject to compliance by Borrower
with all of the provisions of this Agreement, as long as no Event
of Default exists, to specify whether the Interest Period
commencing on any such date shall be a one (1), two (2), three
(3) or six (6) month period. If Bank shall not have received
timely notice of a designation of such Interest Period as herein
provided, Borrower shall be deemed to have elected to convert all
maturing Eurodollar Loans to Base Rate Loans.

(b) Interest Rate Determination. The Bank shall determine
each interest rate applicable to the Revolving Loan hereunder. The Bank
shall give prompt notice to the Borrower of each rate of interest so
determined and its determination thereof shall be conclusive absent
error.

(c) Conversion Option. Borrower may elect from time to time
(i) to convert all or any part of its Eurodollar Loans to Base Rate
Loans by giving Bank irrevocable notice of such election in writing
prior to 10:00 a.m. (Dallas, Texas time) on the conversion date and such
conversion shall be made on the requested conversion date, provided that
any such conversion of Eurodollar Loan shall only be made on the last
day of the Eurodollar Interest Period with respect thereof, (ii) to
convert all or any part of its Base Rate Loans to Eurodollar Loans by
giving the Bank irrevocable written notice of such election three (3)
Eurodollar Business Days prior to the proposed conversion and such
conversion shall be made on the requested conversion date or, if such
requested conversion date is not a Eurodollar Business Day or a Business
Day, as the case may be, on the next succeeding Eurodollar Business Day
or Business Day, as the case may be. Any such conversion shall not be
deemed to be a prepayment of any of the loans for purposes of this
Agreement or the Note.

(d) Recoupment. If at any time the applicable rate of
interest selected pursuant to Sections 4(a)(i) or 4(a)(ii) above shall
exceed the Maximum Rate, thereby causing the interest on the Note to be
limited to the Maximum Rate, then any subsequent reduction in the
interest rate so selected or subsequently selected shall not reduce the
rate of interest on the Note below the Maximum Rate until the total
amount of interest accrued on the Note equals the amount of interest
which would have accrued on the Note if the rate or rates selected
pursuant to Sections 4(a)(i) or (ii), as the case may be, had at all
times been in effect.

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<PAGE> 20
(e) Default Rate. After maturity (whether by acceleration or
otherwise), the principal balance of the Note shall bear interest to the
extent permitted by law at a rate per annum equal to the lesser of (i)
the Maximum Rate, or (ii) the Base Rate plus five percent (5%) (the
"Default Rate").

5. SPECIAL PROVISIONS RELATING TO EURODOLLAR LOANS.

(a) Unavailability of Funds or Inadequacy of Pricing. In the
event that, in connection with any proposed Eurodollar Loan, Bank (i)
shall have determined that U.S. Dollar deposits of the relevant amount
and for the relevant Eurodollar Interest Period for Eurodollar Loans are
not available to Bank in the London interbank market; or (ii) in good
faith determines that the Eurodollar Interest Rate will not adequately
reflect the cost to the Bank of maintaining or funding the Eurodollar
Loans for such Interest Period, the obligations of the Bank to make the
Eurodollar Loans, as the case may be, shall be suspended until such time
such Bank in its sole discretion reasonably exercised determines that
the event resulting in such suspension has ceased to exist. If Bank
shall make such determination it shall promptly notify Borrower in
writing, and Borrower shall either repay the outstanding Eurodollar
Loans, as the case may be, owed to Bank, without penalty, on the last
day of the current Interest Period or convert the same to Base Rate
Loans in the case of Eurodollar Loans on the last day of the then
current Interest Period for such Eurodollar Loan.

(b) Reserve Requirements. In the event of any change in any
applicable law, treaty or regulation or in the interpretation or
administration thereof, or in the event any central bank or other fiscal
monetary or other authority having jurisdiction over the Bank or the
loans contemplated by this Agreement shall impose, modify or deem
applicable any reserve requirement of the Board of Governors of the
Federal Reserve System on any Eurodollar Loan or loans, or any other
reserve, special deposit, or similar requirements against assets to,
deposits with or for the account of, or credit extended by, the Bank or
shall impose on the Bank or the London interbank market, as the case may
be, any other condition affecting this Agreement or the Eurodollar Loans
and the result of any of the foregoing is to increase the cost to the
Bank in making or maintaining its Eurodollar Loans or to reduce any
amount (or the effective return on any amount) received by the Bank
hereunder, then Borrower shall pay to the Bank upon demand of the Bank
as additional interest on the Note evidencing the Eurodollar Loans such
additional amount or amounts as will reimburse the Bank for such
additional cost or such reduction. The Bank shall give notice to
Borrower upon becoming aware of any such change or imposition which may
result in any such increase or reduction. A certificate of Bank setting
forth the basis for the determination of such amount

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<PAGE> 21
necessary to compensate Bank as aforesaid shall be delivered to Borrower
and shall be conclusive as to such determination and such amount, absent
error.

(c) Taxes. Both principal and interest on the Note evidencing
the Eurodollar Loans are payable without withholding or deduction for or
on account of any taxes. If any taxes are levied or imposed on or with
respect to the Note evidencing the Eurodollar Loans or on any payment on
the Note evidencing the Eurodollar Loans made to the Bank, then, and in
any such event, Borrower shall pay to the Bank upon demand of the Bank
such additional amounts as may be necessary so that every net payment of
principal and interest on the Note evidencing the Eurodollar Loans,
after withholding or deduction for or on account of any such taxes, will
not be less than any amount provided for herein. In addition, if at any
time when the Eurodollar Loans are outstanding any laws enacted or
promulgated, or any court of law or governmental agency interprets or
administers any law, which, in any such case, materially changes the
basis of taxation of payments to the Bank of principal of or interest on
the Note evidencing the Eurodollar Loans by reason of subjecting such
payments to double taxation or otherwise (except through an increase in
the rate of tax on the overall net income of Bank) then Borrower will
pay the amount of loss to the extent that such loss is caused by such a
change. The Bank shall give notice to Borrower upon becoming aware of
the amount of any loss incurred by the Bank through enactment or
promulgation of any such law which materially changes the basis of
taxation of payments to the Bank. The Bank shall also give notice on
becoming aware of any such enactment or promulgation which may result in
such payments becoming subject to double taxation or otherwise. A
certificate of any Bank setting forth the basis for the determination of
such loss and the computation of such amounts shall be delivered to
Borrower and shall be conclusive of such determination and such amount,
absent error.

(d) Change in Laws. If at any time any new law or any change
in existing laws or in the interpretation of any new or existing laws
shall make it unlawful for the Bank to maintain or fund its Eurodollar
Loans hereunder, then the Bank shall promptly notify Borrower in writing
and Borrower shall either repay the outstanding Eurodollar Loans owed to
the Bank, without penalty, on the last day of the current Interest
Periods (or, if the Bank may not lawfully continue to maintain and fund
such Eurodollar Loans, immediately), or Borrower may convert such
Eurodollar Loans at such appropriate time to Base Rate Loans.

(e) Option to Fund. The Bank shall have the option if the
Borrower elects a Eurodollar Loan, to purchase one or more deposits in
order to fund or maintain its funding of the principal balance of the
Note to which such Eurodollar Loan is applicable during the Interest
Period in question; it being understood that the provisions of this
Agreement relating to such funding are included only for the

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<PAGE> 22
purpose of determining the rate of interest to be paid under such
Eurodollar Loan and any amounts owing hereunder and under the Note. The
Bank shall be entitled to fund and maintain its funding of all or any
part of that portion of the principal balance of the Note in any manner
it sees fit, but all such determinations hereunder shall be made as if
the Bank had actually funded and maintained that portion of the
principal balance of the Note to which a Eurodollar Loan is applicable
during the applicable Interest Period through the purchase of deposits
in an amount equal to the principal balance of the Note to which such
Eurodollar Loan is applicable and having a maturity corresponding to
such Interest Period. The Bank may fund the outstanding principal
balance of the Note which is to be subject to any Eurodollar Loan from
any branch or office of the Bank as the Bank may designate from time to
time.

(f) Indemnity. Borrower shall indemnify and hold harmless the
Bank against all reasonable and necessary out-of-pocket costs and
expenses which the Bank may sustain (i) as a consequence of any default
by Borrower under this Agreement, or (ii) as a result of the making of
any loan or loans as a Eurodollar Loan under this Agreement.

(g) Payments Not at End of Interest Period. If the Borrower
makes any payment of principal with respect to any Eurodollar Loan on
any day other than the last day of the Interest Period applicable to
such Eurodollar Loan, then Borrower shall reimburse the Bank on demand
for any loss, cost or expense incurred by the Bank as a result of the
timing of such payment or in redepositing such principal amount,
including the sum of (i) the cost of funds to the Bank in respect of
such principal amount so paid, for the remainder of the Interest Period
applicable to such sum, reduced, if the Bank is able to redeposit such
principal amount so paid for the balance of the Interest Period, by the
interest earned by Bank as a result of so redepositing such principal
amount, plus (ii) any expense or penalty incurred by the Bank in
redepositing such principal amount. A certificate of Bank setting forth
the basis for the determination of the amount owed by Borrower pursuant
to this Section 5(g) shall be delivered to the Borrower and shall be
conclusive in the absence of manifest error.

6. COLLATERAL SECURITY. To secure the performance by Borrower of
its obligations hereunder, and under the Note and Security Instruments, whether
now or hereafter incurred, matured or unmatured, direct or contingent, joint or
several, or joint and several, including extensions, modifications, renewals
and increases thereof, and substitutions therefore, Borrower shall
contemporaneously with or prior to the execution of this Agreement and the
Note, grant and assign to the Bank a first and prior security interest and Lien
on certain of its Oil and Gas Properties, and on certain related equipment, oil
and gas inventory and proceeds of the foregoing. All Oil and Gas Properties
and other

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<PAGE> 23
collateral in which Borrower has herewith granted or hereafter grants to the
Bank either a first and prior Lien (to the satisfaction of the Bank) in
accordance with this Section 6 or a negative pledge (to the satisfaction of the
Bank) pursuant to Section 13 hereof or the Oil and Gas Properties listed and
described on Annex 1, as such properties and interests are from time to time
constituted, are hereinafter collectively called the "Collateral."

The granting and assigning of such security interests and Liens by
Borrower shall be pursuant to Security Instruments in form and substance
reasonably satisfactory to the Bank. Concurrently with the delivery of each of
the Security Instruments, Borrower shall furnish to the Bank mortgage and title
opinions and other documents reasonably satisfactory to Bank with respect to
the title and Lien status of Borrower's interests in not less than 81% of the
Engineered Value of the Oil and Gas Properties. "Engineered Value" for this
purpose shall mean future net revenues discounted at the discount rate being
used by the Bank as of the date of any such determination utilizing the pricing
parameters used in the engineering report furnished to the Bank pursuant to
Sections 7 and 12 hereof. Borrower will cause to be executed and delivered to
the Bank, in the future, additional Security Instruments if the Bank reasonably
deems such are necessary to insure perfection or maintenance of Bank's security
interests and Liens in the Oil and Gas Properties or any part thereof.

7. BORROWING BASE.

(a) Initial Borrowing Base. During the period from the date
hereof to the next Determination Date (as hereinafter defined), the
Borrowing Base shall be $6,200,000.00.

(b) Subsequent Determinations of Borrowing Base. Subsequent
determinations of the Borrowing Base shall be made by the Bank at least
semi-annually as set forth hereinbelow or as Unscheduled
Redeterminations. In connection with each such determination of the
Borrowing Base, the Bank shall also determine the Monthly Commitment
Reduction. Borrower shall furnish to the Bank as soon as possible but
in any event no later than March 1 of each year, beginning March 1,
1997, with an engineering report in form and substance reasonably
satisfactory to Bank prepared by an independent petroleum engineer
acceptable to Bank covering the Oil and Gas Properties utilizing pricing
parameters used by Bank in its reasonable discretion as established from
time to time, together with such other information concerning the value
of the Collateral as the Bank may reasonably deem necessary to determine
the value of the Collateral. By September 1 of each year, beginning
September 1, 1996, or within thirty (30) days after either (i) receipt
of notice from Bank that it requires an Unscheduled Redetermination, or
(ii) Borrower gives notice to Bank of its desire to have an Unscheduled
Redetermination performed, Borrower shall furnish to Bank an engineering
report

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<PAGE> 24
in form and substance satisfactory to Bank prepared in-house by Borrower
valuing the Oil and Gas Properties using substantially the same
methodology utilized by the independent petroleum engineer who prepared
the most recent independent engineer's report, together with such other
information, reports and data concerning the value of the Collateral as
the Bank shall deem reasonably necessary to determine the value of such
Collateral. Within thirty (30) days after receipt by Bank of such
required information, or within a reasonable time thereafter, Bank shall
notify Borrower of the new Borrowing Base and Monthly Commitment
Reduction for the period beginning on the date of such notice (herein
called the "Determination Date") and continuing until, but not
including, the next Determination Date. If an Unscheduled
Redetermination is made by the Bank, the Bank shall notify Borrower
within a reasonable time after receipt of all requested information of
the new Borrowing Base and Monthly Commitment Reduction, if any, and
such new Borrowing Base and Monthly Commitment Reduction shall continue
until the next Determination Date. If Borrower does not furnish all
such information, reports and data by the date specified in this Section
7(b), unless such failure is of no fault of Borrower, the Bank may
nonetheless designate the Borrowing Base and Monthly Commitment
Reduction at any amount which the Bank determines in its discretion to
be appropriate and may redesignate the Borrowing Base and Monthly
Commitment Reduction from time to time thereafter until the Bank
receives all such information, reports and data, whereupon the Bank
shall designate a new Borrowing Base and Monthly Commitment Reduction as
described above. If the information furnished by Borrower in connection
with any scheduled Borrowing Base determination shall ever be
unacceptable to the Bank, Bank shall have the right to require Borrower
to furnish information acceptable to Bank, prepared by an independent
engineer acceptable to Bank. The Bank shall determine the amount of the
Borrowing Base and Monthly Commitment Reduction based upon the loan
collateral value which it in its discretion (using such methodology,
assumptions and discounts rates as Bank customarily uses in assigning
collateral value to oil and gas properties) assigns to such Oil and Gas
Properties of Borrower at the time in question and based upon such other
credit factors consistently applied (including, without limitation, the
assets, liabilities, cash flow, business, properties, prospects,
management and ownership of Borrower and its affiliates) as the Bank
customarily considers in evaluating similar oil and gas credits. It is
expressly understood that the Bank has no obligation to designate the
Borrowing Base or Monthly Commitment Reduction at any particular amount,
except in the exercise of its discretion, whether in relation to the
Revolving Commitment or otherwise, and that the Bank's commitment to
advance funds hereunder is determined by reference to the Borrowing Base
from time to time in effect. Provided, however, that the Bank shall
never have the obligation to designate a Borrowing Base in excess of its
legal or internal lending limits. If at any time any of the Oil and Gas
Properties are sold pursuant to Section 12(q) hereof, the Borrowing Base
then in effect shall

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<PAGE> 25
immediately and automatically be reduced by a sum equal to the amount
prepaid by Borrower pursuant to Section 12(q). The Borrowing Base shall
be additionally reduced from time to time pursuant to the provisions of
Sections 2(e) and 2(f) hereof.

8. FEES.

(a) Origination Fee. Borrower shall pay to Bank on the
Effective Date an Origination Fee (the "Origination Fee") equal to
$10,000.00.

(b) Unused Portion Fee. Borrower shall pay to Bank an Unused
Portion Fee (hereinafter referred to as the "Unused Portion Fee")
equivalent to one-half of one percent ( 1/2%) per annum on the daily
average of the unadvanced amount of the Revolving Commitment as reduced
from time to time pursuant to Sections 2(e) and (f) hereof. The Unused
Portion Fee shall be payable in arrears on the last day of each calendar
quarter beginning June 30, 1996, with the final fee payment on the
Maturity Date for any period then ending for which the Unused Portion
Fee shall not have been theretofore paid. In the event the Revolving
Commitment terminates on any date prior to the end of any such calendar
quarter, Borrower shall pay to Bank, on the date of such termination,
the total Unused Portion Fee due for the period in which such
termination occurs.

(c) Borrowing Base Increase Fee. Borrower agrees to pay to
Bank a Borrowing Base Increase Fee (hereinafter referred to as the
"Borrowing Base Increase Fee") equal to one-fourth of one percent (
1/4%) of the amount of any increase in the Borrowing Base from the
amount of the Borrowing Base set as of the preceding Determination Date,
said fee to be payable upon notice to Borrower of such increase.

(d) Letter of Credit Fee. Borrower shall pay to Bank the
Letter of Credit fees and amendment fees required above in Section 2(d).

9. PREPAYMENTS.

(a) Voluntary Prepayments. The Borrower may at any time and
from time to time, without penalty or premium, prepay the Note, in whole
or in part. Each such prepayment shall be made on at least one (1)
Business Day's notice to Bank and shall be in a minimum amount of
$100,000 or the unpaid balance on the Note, whichever is less.

(b) Mandatory Prepayment. In the event the aggregate
principal amount outstanding on the Note ever exceeds the Borrowing Base
as determined by Bank

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<PAGE> 26
pursuant to Section 7(b) hereof (a "Borrowing Base Deficiency"),
Borrower shall, within sixty (60) days after written notification from
the Bank, either (A) by instruments reasonably satisfactory in form and
substance to the Bank, provide the Bank with additional collateral with
value and quality in amounts satisfactory to the Bank in its sole
discretion in order to increase the Borrowing Base by an amount at least
equal to such excess, or (B) prepay, without premium or penalty, the
principal amount of the Note in an amount at least equal to such excess
plus interest thereon to the date of such prepayment.

10. REPRESENTATIONS AND WARRANTIES. In order to induce the Bank to
enter into this Agreement, Borrower hereby represents and warrants to the Bank
(which representations and warranties will survive the delivery of the Note)
that:

(a) Partnership Existence. Borrower is a limited partnership
duly formed under the laws of the State of Delaware and is duly
qualified in all jurisdictions wherein the failure to qualify could
reasonably be expected to result in Material Adverse Effect.

(b) Authority of Managing General Partner. Brigham
Exploration Company ("BEC") is the managing general partner of Borrower
and on behalf of Borrower is duly authorized and empowered to create and
issue the Note; and BEC is duly authorized and empowered to execute,
deliver and perform the Security Instruments, including this Agreement;
and all action on BEC's part requisite for due creation and issuance of
the Note and for the due execution, delivery and performance of the
Security Instrument, including this Agreement, has been duly and
effectively taken.

(c) Binding Obligations. This Agreement does, and the Note
and other Loan Documents upon their creation, issuance, execution and
delivery will, constitute valid and binding obligations of Borrower,
enforceable in accordance with its terms (except that enforcement may be
subject to any applicable bankruptcy, insolvency, or similar debtor
relief laws now or hereafter in effect and relating to or affecting the
enforcement of creditors rights generally).

(d) No Legal Bar or Resultant Lien. The Note and the Loan
Documents, including this Agreement, do not and will not, to the best of
Borrower's knowledge, violate any provisions of any contract, agreement,
law, regulation, order, injunction, judgment, decree or writ to which
Borrower is subject, or result in the creation or imposition of any lien
or other encumbrance upon any assets or properties of Borrower, other
than those contemplated by this Agreement.

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<PAGE> 27
(e) No Consent. The execution, delivery and performance by
Borrower of the Note and the Security Instruments, including this
Agreement, does not require the consent or approval of any other person
or entity, including without limitation any regulatory authority or
governmental body of the United States or any state thereof or any
political subdivision of the United States or any state thereof or any
political subdivision of the United States or any state thereof except
for (i) consents required for federal, state and, in some instances,
private leases, right of ways and other conveyances or encumbrances of
oil and gas leases (all of which consents have been obtained by
Borrower) and (ii) those consents the failure to obtain could reasonably
be expected not to cause a Material Adverse Effect.

(f) Financial Condition. The Financial Statements of Borrower
dated December 31, 1995, which have been delivered to Bank are complete
and correct in all material respects, and fully and accurately reflect
in all material respects the financial condition and results of the
operations of the Borrower as of the date or dates and for the period or
periods stated, and such Financial Statements have been prepared in
accordance with GAAP. No change has since occurred in the condition,
financial or otherwise, of Borrower which is reasonably expected to have
a Material Adverse Effect, except as disclosed to the Bank in Schedule
"3" attached hereto.

(g) Liabilities. Borrower has no material (individually or in
the aggregate) liability, direct or contingent, except as disclosed to
the Bank in the Financial Statements or on Schedule "4" attached hereto.
No unusual or unduly burdensome restrictions, restraint, or hazard
exists by contract, law or governmental regulation or otherwise relative
to the business, assets or properties of Borrower which is reasonably
expected to have a Material Adverse Effect.

(h) Litigation. Except as described in the Financial
Statements, or as otherwise disclosed to the Bank in Schedule "5"
attached hereto, there is no litigation, legal or administrative
proceeding, investigation or other action of any nature pending or, to
the knowledge of the general partner of Borrower, threatened against or
affecting Borrower which involves the possibility of any judgment or
liability not fully covered by insurance, and which is reasonably
expected to have a Material Adverse Effect.

(i) Taxes; Governmental Charges. Borrower has filed all tax
returns and reports required to be filed and has paid all taxes,
assessments, fees and other governmental charges levied upon it or its
assets, properties or income which are due and payable, including
interest and penalties, the failure of which to pay could reasonably be
expected to have a Material Adverse Effect, except such as are being
contested in good faith by appropriate proceedings and for which
adequate reserves

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<PAGE> 28
for the payment thereof as required by GAAP has been provided and levy
and execution thereon have been stayed and continue to be stayed.

(j) Titles, Etc. Borrower has good and defensible title to
the Oil and Gas Properties, free and clear of all Liens except Permitted
Liens.

(k) Defaults. Borrower is not in default and no event or
circumstance has occurred which, but for the passage of time or the
giving of notice, or both, would constitute a default under any loan or
credit agreement, indenture, mortgage, deed of trust, security agreement
or other agreement or instrument to which Borrower is a party in any
respect that would be reasonably expected to have a Material Adverse
Effect. No Event of Default hereunder has occurred and is continuing.

(l) Casualties; Taking of Properties. Since the dates of the
latest Financial Statements of Borrower delivered to Bank, neither the
business nor the assets or properties of Borrower have been affected (to
the extent it could reasonably be expected to have a Material Adverse
Effect), as a result of any fire, explosion, earthquake, flood, drought,
windstorm, accident, strike or other labor disturbance, embargo,
requisition or taking of property or cancellation of contracts, permits
or concessions by any domestic or foreign government or any agency
thereof, riot, activities of armed forces or acts of God or of any
public enemy.

(m) Use of Proceeds; Margin Stock. The availability under the
Revolving Commitment shall be used by Borrower for (i) the issuance of
Letters of Credit, (ii) working capital and (iii) general business
purposes. Borrower is not engaged principally or as one of its
important activities in the business of extending credit for the purpose
of purchasing or carrying any "margin stock" as defined in Regulation U
of the Board of Governors of the Federal Reserve System (12 C.F.R. Part
221), or for the purpose of reducing or retiring any indebtedness which
was originally incurred to purchase or carry a margin stock or for any
other purpose which might constitute this transaction a "purpose credit"
within the meaning of said Regulation U.

Neither Borrower nor any person or entity acting on behalf of
Borrower has taken or will take any action which might cause the loans
hereunder or any of the Security Instruments, including this Agreement,
to violate Regulation U or any other regulation of the Board of
Governors of the Federal Reserve System or to violate the Securities
Exchange Act of 1934 or any rule or regulation thereunder, in each case
as now in effect or as the same may hereafter be in effect.

(n) Location of Business and Offices. The principal place of
business of Borrower is located at 5949 Sherry Lane, Suite 1616, Dallas,
Texas 75225.

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<PAGE> 29
(o) Compliance with the Law. To the best of Borrower's
knowledge, Borrower:

(i) is not in violation of any law, judgment, decree,
order, ordinance, or governmental rule or regulation to which
Borrower, or any of its assets or properties are subject; and

(ii) has not failed to obtain any license, permit,
franchise or other governmental authorization necessary to the
ownership of any of its assets or properties or the conduct of
its business;

which violation or failure is reasonably expected to have a Material
Adverse Effect.

(p) No Material Misstatements. No information, exhibit or
report (other than financial projections and other projections relating
to Borrower's drilling and production from the Oil and Gas Properties
which are, to the best of Borrower's knowledge at the time provided,
complete and accurate projections) furnished by Borrower to the Bank in
connection with the negotiation of this Agreement contained any material
misstatement of fact or omitted to state a material fact or any fact
necessary to make the statement contained therein not materially
misleading.

(q) Not A Utility. Borrower is not an entity engaged in the
State of Texas in the (i) generation, transmission, or distribution and
sale of electric power; (ii) transportation, distribution and sale
through a local distribution system of natural or other gas for
domestic, commercial, industrial, or other use; (iii) ownership or
operation of a pipeline for the transmission or sale of natural or other
gas, crude oil or petroleum products to other pipeline companies,
refineries, local distribution systems, municipalities, or industrial
consumers; (iv) provision of telephone or telegraph service to others;
(v) production, transmission, or distribution and sale of steam or
water; (vi) operation of a railroad; or (vii) provision of sewer service
to others.

(r) ERISA. Borrower is in compliance in all material respects
with the applicable provisions of ERISA, and no "reportable event", as
such term is defined in Section 4043 of ERISA, has occurred with respect
to any Plan of Borrower which is reasonably likely to cause a Material
Adverse Effect.

(s) Environmental Matters. Except as disclosed on Schedule
"6", Borrower has not received notice or otherwise learned of (i) any
Environmental Liability which could reasonably be expected to
individually or in the aggregate have a

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<PAGE> 30
Material Adverse Effect arising in connection with (A) any non-
compliance with or violation of the requirements of any Environmental
Law or (B) the release or threatened release of any toxic or hazardous
waste into the environment, (ii) any threatened or actual liability in
connection with the release or threatened release of any toxic or
hazardous waste into the environment which could reasonably be expected
to individually or in the aggregate have a Material Adverse Effect or
(iii) any federal or state investigation evaluating whether any remedial
action is needed to respond to a release or threatened release of any
toxic or hazardous waste into the environment for which Borrower is or
may be liable which could reasonably be expected to result in a Material
Adverse Effect.

(t) Ownership of Borrower. The general partnership interests
in Borrower are owned by the individuals and entities listed on Schedule
"1".

(u) Liens. Except for Permitted Liens, the Oil and Gas
Properties are free and clear of all Liens and security interests.

11. CONDITIONS OF LENDING.

(a) The obligation of the Bank to make the initial Advance
under the Revolving Commitment shall be subject to the following
conditions precedent:

(i) Execution and Delivery. Borrower shall have
executed and delivered to the Bank the Note, this Agreement and
the other Loan Documents, and other required documents, all in
form and substance satisfactory to the Bank;

(ii) Legal Opinion. The Bank shall have received from
Borrower's legal counsel a favorable legal opinion in form and
substance satisfactory to Bank (i) as to the matters set forth in
Subsections 10(a), (b), (c), (d), (e) and (h) hereof, and (ii) as
to such other matters as Bank or its counsel may reasonably
request;

(iii) Partnership Agreement. The Bank shall have
received a copy of the Borrower's Partnership Agreement and all
amendments thereto, certified to by the President or Vice
President of the General Partner as being a true and correct
copies of such Agreement and all amendments;

(iv) Good Standing and Existence. The Bank shall have
received evidence of existence and good standing for Borrower and
BEC;

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<PAGE> 31
(v) Corporate Resolutions. The Bank shall have
received appropriate certified corporate resolutions of BEC;

(vi) Incumbency. The Bank shall have received a signed
certificate of the officers of BEC, certifying the names of each
of the officers of BEC authorized to sign loan documents on
behalf of Borrower, together with the true signatures of each
such officer. The Bank may conclusively rely on such certificate
until the Bank receives a further certificate of the authorized
officers of BEC canceling or amending the prior certificate and
submitting signatures of the officers named in such further
certificate;

(vii) Title. The Bank shall have received satisfactory
evidence of the state of title to at least 81% of the Engineered
Value of the Oil and Gas Properties;

(viii) Subordinated Debt. The Bank shall have received
satisfactory evidence in the form of a letter to the Lenders (as
defined in the Subordinated Debt Agreement) to the effect that
the obligations owed the Bank under this Agreement have been
designated by Borrower as "Senior Obligations" pursuant to the
provision of that certain Subordinated Debt Agreement together
with evidence of the receipt by each subordinated lender of such
letter;

(ix) Management Committee Approval. The Bank shall have
received appropriate resolutions of the Management Committee of
Borrower approving the transactions described in this Agreement;

(x) Representation and Warranties. The representations
and warranties of Borrower under this Agreement are true and
correct in all material respects as of such date, as if then made
(except to the extent that such representations and warranties
related solely to an earlier date);

(xi) No Event of Default. No Event of Default shall
have occurred and be continuing nor shall any event have occurred
or failed to occur which, with the passage of time or service of
notice, or both, would constitute an Event of Default;

(xii) Other Documents. The Bank shall have received such
other instruments and documents incidental and appropriate to the
transaction provided for herein as the Bank or its counsel may

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<PAGE> 32
reasonably request, and all such documents shall be in form and
substance reasonably satisfactory to the Bank; and

(xiii) Legal Matters Satisfactory. All legal
matters incident to the consummation of the transactions
contemplated hereby shall be reasonably satisfactory to special
counsel for the Bank retained at the expense of Borrower.

(b) The obligation of the Bank to make any Advance (including
the initial Advance) on the Revolving Commitment shall be subject to the
following additional conditions precedent that, at the date of making
each such Advance and after giving effect thereto:

(i) Representation and Warranties. With respect to any
Advance, the representations and warranties of Borrower under
this Agreement are true and correct in all material respects as
of such date, as if then made (except to the extent that such
representations and warranties related solely to an earlier
date);

(ii) No Event of Default. No Event of Default shall have
occurred and be continuing nor shall any event have occurred or
failed to occur which, with the passage of time or service of
notice, or both, would constitute an Event of Default;

(iii) Other Documents. The Bank shall have received such
other instruments and documents incidental and appropriate to the
transaction provided for herein as the Bank or its counsel may
reasonably request, and all such documents shall be in form and
substance reasonably satisfactory to the Bank; and

(iv) Legal Matters Satisfactory. All legal matters
incident to the consummation of the transactions contemplated
hereby shall be reasonably satisfactory to special counsel for
the Bank retained at the expense of Borrower.

12. AFFIRMATIVE COVENANTS. A deviation from the provisions of this
Section 12 shall not constitute an Event of Default under this Agreement if
such deviation is consented to in writing by the Bank. Without the prior
written consent of the Bank, Borrower will at all times comply with the
covenants contained in this Section 12 from the date hereof and for so long as
any part of the Revolving Commitment is in existence.

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<PAGE> 33
(a) Financial Statements and Reports. Borrower shall promptly
furnish to the Bank from time to time upon request such information
regarding the business and affairs and financial condition of the
Borrower, as the Bank may reasonably request, and will furnish to the
Bank:

(i) Annual Audited Financial Statements. As soon as
available, and in any event within ninety (90) days after the
close of each fiscal year beginning with the fiscal year ended
December 31, 1995, the annual audited consolidated Financial
Statements of Borrower, prepared in accordance with GAAP
accompanied by an unqualified opinion rendered by an independent
accounting firm reasonably acceptable to the Bank;

(ii) Quarterly Financial Statements. As soon as
available, and in any event within forty-five (45) days after the
end of each calendar quarter of each year (except the last
calendar quarter of any fiscal year), beginning with the fiscal
quarter ended March 31, 1996, the quarterly unaudited Financial
Statements of Borrower prepared in accordance with GAAP;

(iii) Report on Properties. As soon as available and in
any event on or before March 1 and September 1 of each calendar
year, and at such other times as Bank, in accordance with Section
7 hereof, may request, the engineering reports required to be
furnished to the Bank under such Section 7 on the Oil and Gas
Properties;

(iv) Monthly Production Reports. Within 30 days after
the end of each month, a monthly report, in form and substance
satisfactory to the Bank, indicating the next preceding month's
sales volume, sales revenues, production taxes, operating expense
and net operating income from the Oil and Gas Properties, with
detailed calculations and worksheets, in the form of Schedule "7"
attached hereto and in substance satisfactory to Bank;

(v) Schedule of Liabilities. As soon as available, and
in any event within forty-five (45) days after the end of each
calendar quarter of each year (except for the last calendar
quarter of any year where the schedules required herein shall be
delivered within ninety (90) days of the end of such quarter),
beginning with the calendar quarter ended March 31, 1996, a
schedule of all material contingent liabilities together with a
statement of the current status of each such liability, in form
and in substance satisfactory to Bank;

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<PAGE> 34
(vi) Additional Information. Promptly upon request of
the Bank from time to time any additional financial information
or other information that the Bank may reasonably request.

All such information, reports, balance sheets and Financial Statements
referred to in Subsection 12(a) above shall be in such detail as the
Bank may reasonably request and shall be prepared in a manner consistent
with the Financial Statements.

(b) Certificates of Compliance. Concurrently with the
furnishing of the annual Financial Statements of Borrower pursuant to
Subsection 12(a)(i) hereof and the quarterly Financial Statements of
Borrower pursuant to Section 12(a)(ii) hereof, Borrower will furnish or
cause to be furnished to the Bank a certificate in the form of Exhibit
"C" attached hereto, signed by the Chief Financial Officer of the
Borrower (i) stating that, except as otherwise disclosed therein,
Borrower has fulfilled in all material respects its obligations under
this Agreement and the other Loan Documents and that all representations
and warranties made herein and therein continue (except to the extent
they relate solely to an earlier date) to be true and correct in all
material respects (or specifying the nature of any change), or if an
Event of Default has occurred, specifying the Event of Default and the
nature and status thereof; (ii) to the extent requested from time to
time by the Bank, specifically affirming compliance of Borrower in all
material respects with any of its representations (except to the extent
they relate solely to an earlier date) or obligations under said
instruments; (iii) setting forth the computation, in reasonable detail
as of the end of each period covered by such certificate, of compliance
with Sections 13(b) and (c); and (iv) containing or accompanied by such
financial or other details, information and material as the Bank may
reasonably request to evidence such compliance.

(c) Taxes and Other Liens. The Borrower will pay and
discharge promptly all taxes, assessments and governmental charges or
levies imposed upon Borrower or upon the income or any assets or
property of the Borrower as well as all claims of any kind (including
claims for labor, materials, supplies and rent) which, if unpaid, might
become a Lien (other than a Permitted Lien) upon any or all of the
assets or property of Borrower and which could reasonably be expected to
result in a Material Adverse Effect; provided, however, that Borrower
shall not be required to pay any such tax, assessment, charge, levy or
claim if the amount, applicability or validity thereof shall currently
be contested in good faith by appropriate proceedings diligently
conducted, levy and execution thereon have been stayed and continue to
be stayed, and Borrower shall have set up adequate reserves therefor, if
required, under GAAP.

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<PAGE> 35
(d) Compliance with Laws. Borrower will observe and comply,
in all material respects, with all applicable laws, statutes, codes,
acts, ordinances, orders, judgments, decrees, injunctions, rules,
regulations, orders and restrictions relating to environmental standards
or controls or to energy regulations of all federal, state, county,
municipal and other governments, departments, commissions boards,
agencies, courts, authorities, officials and officers, domestic or
foreign the failure to observe and comply with which could reasonably be
expected to have a Material Adverse Effect.

(e) Further Assurances. Borrower will cure, or cause to be
cured, promptly any defects in the creation and issuance of the Note and
the execution and delivery of the Note and the other Loan Documents,
including this Agreement. Borrower at its sole expense will promptly
execute and deliver to Bank upon its reasonable request all such other
and further documents, agreements and instruments in compliance with or
accomplishment of the covenants and agreements in this Agreement, or to
correct any omissions in the Note or more fully to state the obligations
set out herein.

(f) Performance of Obligations. Borrower will pay the Note
and other obligations incurred by it hereunder according to the reading,
tenor and effect thereof and hereof; and Borrower will do and perform
every act and discharge all of the obligations provided to be performed
and discharged by Borrower under the Loan Documents, including this
Agreement, at the time or times and in the manner specified.

(g) Insurance. The Borrower now maintains and will continue
to maintain insurance with financially sound and reputable insurers with
respect to its assets against such liabilities, fires, casualties, risks
and contingencies and in such types and amounts as is customary in the
case of persons engaged in the same or similar businesses and similarly
situated where the failure to so maintain such insurance could
reasonably be expected to have a Material Adverse Effect. Upon request
of the Bank, the Borrower will furnish or cause to be furnished to the
Bank from time to time a summary of the respective insurance coverage of
Borrower in form and substance satisfactory to the Bank, and, if
requested, will furnish the Bank copies of the applicable policies.
Upon demand by Bank any insurance policies covering the Oil and Gas
Properties shall be endorsed (i) to provide that such policies may not
be canceled, reduced or affected in any manner for any reason without
fifteen (15) days prior notice to Bank, (ii) to provide for insurance
against fire, casualty and other hazards normally insured against, in
the amount of the full value (less a reasonable deductible not to exceed
amounts customary in the industry for similarly situated business and
properties) of the property insured, and (iii) to provide for such other
matters as the Bank may reasonably require. The Borrower shall at all

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<PAGE> 36
times maintain adequate insurance with respect to the Oil and Gas
Properties or any collateral against its liability for injury to persons
or property, which insurance shall be by financially sound and reputable
insurers and shall without limitation provide the following coverages:
comprehensive general liability (including coverage for damage to
underground resources and equipment, damage caused by blowouts or
cratering, damage caused by explosion, damage to underground minerals or
resources caused by saline substances, broad form property damage
coverage, broad form coverage for contractually assumed liabilities and
broad form coverage for acts of independent contractors), worker's
compensation and automobile liability. The Borrower shall, if deemed
economical in the reasonable discretion of the Borrower, at all times
maintain cost of control of well insurance with respect to the Oil and
Gas Properties which shall insure the Borrower against seepage and
pollution expense; redrilling expense; and cost of control of well;
fires, blowouts, etc. Additionally, the Borrower shall at all times
maintain adequate insurance with respect to all of its other assets and
wells in accordance with prudent business practices.

(h) Accounts and Records. Borrower will keep books, records
and accounts in which full, true and correct entries will be made of all
dealings or transactions in relation to its business and activities,
prepared in a manner consistent with prior years, subject to changes
required by GAAP or suggested by Borrower's auditors where the failure
to maintain such books, records and account could reasonably be expected
to have a Material Adverse Effect.

(i) Right of Inspection. Borrower will permit any officer,
employee or agent of the Bank to examine the Borrower's books, records
and accounts, and take copies and extracts therefrom, all at such
reasonable times during normal business hours and as often as the Bank
may reasonably request. The Bank will keep all such information
confidential and will not without prior written consent disclose or
reveal the information or any part thereof to any person other than the
Bank's officers, employees, legal counsel, regulatory authorities or
advisors to whom it is necessary to reveal such information for the
purpose of effectuating the agreements and undertakings specified herein
or as otherwise required by law or in connection with the enforcement of
Bank's rights and remedies under the Note, this Agreement and the other
Loan Documents. The Bank will make reasonable efforts to insure that
any person to whom such confidential information is disclosed will keep
such information confidential.

(j) Notice of Certain Events. Borrower shall promptly notify
the Bank if Borrower learns of the occurrence of (i) any event which
constitutes a Default or an Event of Default (including, but not limited
to, a Change of Control) together with a detailed statement by Borrower
of the steps being taken to cure the Default

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<PAGE> 37
or Event of Default; or (ii) any legal, judicial or regulatory
proceedings affecting the Borrower or any of the assets or properties of
the Borrower which, if adversely determined, could have a Material
Adverse Effect; or (iii) any dispute between the Borrower and any
governmental or regulatory body or any other person or entity which, if
adversely determined, could cause a Material Adverse Effect; or (iv) any
other matter which in Borrower's opinion could reasonably be expected to
have a Material Adverse Effect.

(k) ERISA Information and Compliance. Borrower will promptly
furnish to the Bank immediately upon becoming aware of the occurrence of
any "reportable event", as such term is defined in Section 4043 of
ERISA, or of any "prohibited transaction", as such term is defined in
Section 4975 of the Internal Revenue Code of 1954, as amended, in
connection with any Plan or any trust created thereunder, a written
notice signed by the President or Chief Financial Officer of Borrower
specifying the nature thereof, what action Borrower is taking or
proposes to take with respect thereto, and, when known, any action taken
by the Internal Revenue Service with respect thereto.

(l) Environmental Reports and Notices. Borrower will deliver
to the Bank (i) promptly upon its becoming available, one copy of each
report sent by the Borrower to any court, governmental agency or
instrumentality pursuant to any Environmental Law (excluding, however,
reports filed with the Texas Railroad Commission or any similar state or
federal agency in the ordinary course of Borrower's business where the
report does not disclose, or is not in response to allegations of,
violation by Borrower of an Environmental Law), (ii) notice, in writing,
promptly upon Borrower's learning that it has received notice or
otherwise learned of any claim, demand, action, event, condition, report
or investigation indicating any potential or actual liability arising in
connection with (x) the non-compliance with or violation of the
requirements of any Environmental Law which could reasonably be expected
to have a Material Adverse Effect; (y) the release or threatened release
of any toxic or hazardous waste into the environment which could
reasonably be expected to have a Material Adverse Effect or which
release Borrower would have a duty to report to any court or government
agency or instrumentality, or (iii) the existence of any Environmental
Lien on any properties or assets of the Borrower and Borrower shall
immediately deliver a copy of any such notice to Bank.

(m) Maintenance. The Borrower will (i) observe and comply in
all material respects with all Environmental Laws where the failure to
comply could reasonably be expected to have a Material Adverse Effect;
(ii) except as provided in Subsections 12(o) and 12(p) below, maintain,
preserve, and keep or cause to be maintained, preserved and kept its Oil
and Gas Properties and all appurtenances

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<PAGE> 38
thereto, including, without limitation, all buildings, improvements,
machinery, equipment, pipelines, fixtures and other personal property of
every kind or character in respect of the Oil and Gas Properties, in
thorough repair, working order and condition, and from time to time, at
our own expense, do and cause to be done all necessary and proper
repairs, renewals, replacements and substitutions of the Oil and Gas
Properties and all appurtenances thereto, so that at all times the state
and condition of the Oil and Gas Properties and all appurtenances
thereto will be fully preserved and maintained; (iii) take or cause to
be taken whatever actions are necessary or desirable to prevent an event
or condition of default by Borrower under the provisions of any gas
purchase or sales contract or any other contract, agreement or lease
comprising a part of the Oil and Gas Properties or other collateral
security hereunder which default could reasonably be expected to result
in a Material Adverse Effect; and (iv) furnish Bank upon request with a
certificate of the chief executive officer or chief financial officer or
other evidence satisfactory to Bank to the effect that there are no
Liens, claims or encumbrances superior to the Lien of the Bank on the
Oil and Gas Properties, except laborers', vendors', repairmen's,
mechanics', worker's, or materialmen's liens arising by operation of law
or incident to the construction or improvement of property if the
obligations secured thereby are not yet due or are being contested in
good faith by appropriate legal proceedings or Permitted Liens.

(n) Operation of Properties. Except as provided in Subsection
12(o) and (p) below, the Borrower will operate, or use reasonable
efforts to cause to be operated, all Oil and Gas Properties in a careful
and efficient manner in accordance with the practice of the industry and
in compliance in all material respects with all applicable laws, rules,
and regulations, and in compliance in all material respects with all
applicable proration and conservation laws of the jurisdiction in which
the properties are situated, and all applicable laws, rules, and
regulations, of every other agency and authority from time to time
constituted to regulate the development and operation of the properties
and the production and sale of hydrocarbons and other minerals therefrom
where the failure to so operate could reasonably be expected to have a
Material Adverse Effect; provided, however, that the Borrower shall have
the right to contest in good faith by appropriate proceedings, the
applicability or lawfulness of any such law, rule or regulation and
pending such contest may defer compliance therewith, as long as such
deferment shall not subject the properties or any part thereof to
foreclosure or loss.

(o) Compliance with Leases and Other Instruments. The
Borrower will pay or cause to be paid and discharge all rentals, delay
rentals, royalties, production payment, and indebtedness required to be
paid by Borrower (or required to keep unimpaired in all material
respects the rights of Borrower in Oil and Gas Properties) accruing
under, and perform or cause to be performed in all material respects
each

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<PAGE> 39
and every act, matter, or thing required of Borrower by each and all of
the assignments, deeds, leases, subleases, contracts, and agreements in
any way relating to Borrower or any of the Oil and Gas Properties and do
all other things necessary of Borrower to keep unimpaired in all
material respects the rights of Borrower thereunder and to prevent the
forfeiture thereof or default thereunder where the failure to so pay or
perform or do other things could reasonably be expected to have a
Material Adverse Effect; provided, however, that nothing in this
Agreement shall be deemed to require Borrower to perpetuate or renew any
oil and gas lease or other lease by payment of rental or delay rental or
by commencement or continuation of operations nor to prevent Borrower
from abandoning or releasing any oil and gas lease or other lease or
well thereon when, in any of such events, in the opinion of Borrower
exercised in good faith, it is not in the best interest of the Borrower
to perpetuate the same.

(p) Certain Additional Assurances Regarding Maintenance and
Operations of Properties. With respect to those Oil and Gas Properties
which are being operated by operators other than the Borrower, the
Borrower shall not be obligated to perform any undertakings contemplated
by the covenants and agreement contained in Subsections 12(m) through
12(o) hereof which are performable only by such operators and are beyond
the control of Borrower; and otherwise Borrower's covenants as expressed
in Subsections 12(m) through 12(o) are modified to require that Borrower
use reasonable efforts to obtain compliance with such covenants by the
working interest owners or the operator or operators of the Oil and Gas
Properties, including, without limitation, the exercise by Borrower of
all rights under any operating agreements to which Borrower is a party.

(q) Sale of Certain Assets/Prepayment of Proceeds. The
Borrower will, immediately pay over to the Bank as a prepayment of
principal, 100% of the Release Price (net of federal income taxes and
direct costs of sale) received by the Borrower from the sale of any or
all of the Oil and Gas Properties other than the sale of production in
the ordinary course of Borrower's business, which sale has been approved
in advance by the Bank. Any prepayment made by Borrower pursuant to
this Section 12(q) shall reduce the Borrowing Base dollar for dollar.
The term "Release Price" as used herein shall mean a price determined by
the Bank in its discretion based upon the loan collateral value which
Bank in its discretion (using such methodology, assumptions and
discounts rates as Bank customarily uses in assigning collateral value
to oil and gas properties, oil and gas gathering systems, gas processing
and plant operations) assigns to such Oil and Gas Properties at the time
in question.

(r) Title Matters. As to any Oil and Gas Properties hereafter
mortgaged to Bank, Borrower will promptly (but in no event more than
sixty (60) days

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<PAGE> 40
following such mortgaging), furnish Bank with title opinions and/or
title information reasonably satisfactory to Bank showing good and
defensible title of Borrower to such Oil and Gas Properties subject only
to Permitted Liens.

(s) Curative Matters. Within ninety (90) days after the date
hereof with respect to matters listed on Schedule "8" (except for item
#3 on Schedule "8" for which there is only a ten (10) day cure period)
and, thereafter, within ninety (90) days after receipt by Borrower from
Bank or its counsel of written notice of title defects the Bank
reasonably requires to be cured, Borrower shall either (i) provide such
curative information, in form and substance satisfactory to Bank, (ii)
substitute Oil and Gas Properties of value and quality satisfactory to
the Bank for all of Oil and Gas Properties for which such title curative
was requested but upon which Borrower elected not to provide such title
curative information, and, within ninety (90) days of such substitution,
provide title opinions or title information satisfactory to the Bank
covering the Oil and Gas Properties so substituted, or (iii) make a
prepayment of principal equal to the amount, if any, the principal
amount due on the Note exceeds the Borrowing Base as a result of the
value of such Oil and Gas Properties (as determined by the Bank pursuant
to Section 7(b) hereof) being deducted from the then available Borrowing
Base.

(t) Change of Principal Place of Business. Borrower shall
give Bank at least thirty (30) days prior written notice of its
intention to move its principal place of business from the address set
forth in Section 16 hereof.

(u) Bank Accounts. Borrower shall establish and maintain with
Bank one or more operating accounts for Borrower (the "Operating
Accounts") and a lockbox accounts for Borrower ("Lockbox Account"), the
maintenance of each of which shall be subject to such rules and
regulations as the Bank shall from time to time specify. Such accounts
shall be maintained with the Bank until all amounts due hereunder and
under the Note have been paid in full. Borrower shall, within ten (10)
days of the Effective Date, instruct and cause all monetary proceeds of
production from the Oil and Gas Properties to be remitted to the Lockbox
Accounts. Such proceeds of production shall not be redirected without
the prior written consent of the Bank until such time as all
indebtedness due Bank by Borrower has been paid in full. If no Event of
Default has occurred and is continuing, the full balance of the Lockbox
Account each day will be deposited into the Operating Accounts. The
Borrower hereby grants a security interest to Bank in and to the Lockbox
Account and the Operating Accounts (collectively, the "Cash Collateral
Accounts") and all checks, drafts and other items ever received by Bank
for deposit therein. If any Event of Default shall occur and be
continuing, Bank shall have the immediate right, without prior notice or
demand, to take and apply against the Borrower's obligations

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<PAGE> 41
hereunder any and all funds legally and beneficially owned by the
Borrower then or thereafter on deposit in the Cash Collateral Accounts.

(v) Additional Collateral. Borrower agrees to regularly
monitor on or before each Determination Date all producing oil and gas
properties and interests acquired and/or drilled by Borrower on or after
the date hereof used in the calculation of the Borrowing Base and pledge
or cause to be pledged such of the same to Bank in substantially the
form of the Security Instruments, as applicable, so that the Bank shall
at all times during the existence of the Revolving Commitment be secured
by perfected Liens covering not less than ninety percent (90%) of the
Engineered Value of all producing oil and gas properties of Borrower
used in the calculation of the Borrowing Base.

13. NEGATIVE COVENANTS. A deviation from the provisions of this
Section 13 shall not constitute an Event of Default under this Agreement if
such deviation is consented to in writing by the Bank. Without the prior
written consent of the Bank, Borrower will at all times comply with the
covenants contained in this Section 13 from the date hereof and for so long as
any part of the Revolving Commitment is in existence.

(a) Liens. Borrower will not create, incur, assume or permit
to exist any Lien or security interest on any of its assets or
properties (except office equipment) except Permitted Liens.

(b) Current Ratio. Borrower will not allow its ratio of
Current Assets to Current Liabilities to be less than 1.0 to 1.0 during
any period beginning on the Effective Date and ending on the Maturity
Date, said ratio to be tested at the end of each fiscal quarter.

(c) Debt Service Coverage Ratio. Borrower will not allow its
ratio of Net Cash Flow to Debt Service for any fiscal quarter, to ever
be less than 1.0 to 1.0; provided, however, that at any time the Monthly
Commitment Reduction equals $0 per month, then in such event, the
Borrower will not allow its ratio of Net Cash Flow to Debt Service to be
less than (i) 2.0 to 1.0 for any fiscal quarter ended on or before
September 30, 1996, (ii) 2.25 to 1.0 for the fiscal quarter ended
December 31, 1996 and (iii) 2.5 to 1.0 for any fiscal quarter
thereafter.

(d) Debts, Guaranties and Other Obligations. Borrower will
not incur, create, assume or in any manner become or be liable in
respect of any indebtedness, nor will the Borrower guarantee or
otherwise in any manner become or be liable in respect of any
indebtedness, liabilities or other obligations of any other person or
entity, whether by agreement to purchase the indebtedness of any other
person or entity or agreement for the furnishing of funds to any other
person or entity

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<PAGE> 42
through the purchase or lease of goods, supplies or services (or by way
of stock purchase, capital contribution, advance or loan or issuance of
preferred stock or other quasi-equity) for the purpose of paying or
discharging the indebtedness of any other person or entity, or
otherwise, except that the foregoing restrictions shall not apply to:

(i) the Note, or other indebtedness of Borrower
heretofore disclosed to Bank in Borrower's Financial Statements
or on Schedule "4" hereto;

(ii) taxes, assessments or other government charges
which are not yet due or are being contested in good faith by
appropriate action promptly initiated and diligently conducted,
if such reserve as shall be required by GAAP shall have been made
therefor;

(iii) indebtedness incurred in the ordinary course of
business, including, but not limited to indebtedness for
drilling, completing, leasing and reworking oil and gas wells;

(iv) indebtedness or lease obligations incurred for the
purchase of computers and/or telephone systems and/or other
equipment related to Borrower's operations; or

(v) renewals or extensions of any or all of the
foregoing.

(e) Loans and Advances. Borrower shall not make or permit to
remain outstanding any loans or advances to any person or entity, except
that the foregoing restriction shall not apply to:

(i) loans or advances the material details of which
have been set forth in the Financial Statements of Borrower
heretofore furnished to Bank or have otherwise heretofore been
disclosed to Bank on Schedule "9" hereto; and

(ii) advances made in the ordinary course of Borrower's
business as conducted on the Effective Date.

(f) Nature of Business. Borrower will not permit any material
change to be made in the character of its business as carried on at the
date hereof which could reasonably be expected to have a Material
Adverse Effect.

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<PAGE> 43
(g) Hedging Transactions. Borrower will not enter into any
transaction providing (i) for the hedging, forward sale or swap of crude
oil or natural gas or other commodities, or (ii) for a swap, collar,
floor, cap, option, corridor, or other contract which is intended to
reduce or eliminate the risk of fluctuation in interest rates, as such
terms are referred to in the capital markets, except the foregoing
prohibitions shall not apply to (x) transactions consented to in writing
by the Bank which are on terms acceptable to the Bank, or (y)
Pre-approved Contracts. The term "Pre-Approved Contracts" as used
herein shall mean any contract or agreement (i) to hedge, forward, sell
or swap crude oil or natural gas or otherwise sell up to 75% of
Borrower's monthly production forecast for all of Borrower's proved and
producing oil and gas properties for the period covered by the proposed
hedging transaction, (ii) with a maturity of twelve (12) months or less,
(iii) with "strike prices" per barrel greater than the Bank's forecasted
price in the most recent engineering evaluation of the Borrower's oil
and gas properties, adjusted for the difference between the forecasted
price and the Borrower's actual product price as determined by Bank, and
(iv) with counter-parties to the hedging agreement which are approved by
Bank.

(h) Sale of Assets. Borrower shall not sell, transfer or
otherwise dispose of the Oil and Gas Properties except for production
from the oil and gas properties and undeveloped leases or acreage sold
in the ordinary course of Borrower's business.

(i) Transactions with Affiliates. Borrower will not enter
into any transaction with any of its affiliates, except transactions
upon terms no less favorable to it than would be obtained in a
transaction negotiated at arm's length with a unrelated third party.

(j) Consolidations and Mergers. Borrower will not consolidate
or merge with or into any other Person, except that Borrower may merge
with another Person if Borrower is the surviving entity in such merger
and if, after giving effect thereto, no Default or Event of Default
shall have occurred and be continuing.

(k) Distributions. Borrower will not make any distribution of
any kind to its partners except cash distributions to the partners in
Borrower for the payment by such partner or partners of federal or state
income taxes on such partner or partners' proportionate share of the
Borrower's taxable income, such distribution for such purpose to assume
the maximum tax rate for each such partner. Provided, however, that
prior to making any such distribution of any partner, Borrower will
provide to the Bank a certificate of its chief financial officer
certifying that such distribution was made in compliance with the
aforesaid standard or requirement. In addition, Borrower shall provide
Bank with a copy of the K-1 Supplemental

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<PAGE> 44
Exhibit to Internal Revenue Service Form 1065 relating to such partner
or partners at the same time the K-1 is made available to the partner or
partners.

(l) Investments. Borrower shall not make any investments in
any person or entity, except such restriction shall not apply to:

(i) investments and direct obligations of the United
States of America or any agency thereof;

(ii) investments in certificates of deposit issued by
Bank or certificates of deposit with maturities of less than one
year, issued by other commercial banks in the United States
having capital and surplus in excess of $500,000,000 and which
have a rating of (A) 50 or above by Sheshunoff and (B) "B" or
above by Keef-Bruett; or

(iii) investments in insured money market funds,
Eurodollar investment accounts and other similar accounts at Bank
or such investment with maturities of less than ninety (90) days
at other commercial banks having capital and surplus in excess of
$500,000,000 and which have a rating of (A) 50 or above by
Sheshunoff and (B) "B" or above by Keef-Bruett.

(m) Amendment of Partnership Agreement. Borrower will not
permit any amendment to, or any alteration of, its Partnership Agreement
without the written consent of the Bank. If any amendment or alteration
is made to the Partnership Agreement after receipt of consent of the
Bank, the Borrower shall provide a copy of such amendment or alteration
to the Bank within five (5) days of the execution thereof.

(n) Payment of Subordinated Debt. Borrower will not make any
payment, principal or interest, on the subordinated debt created
pursuant to that certain Note Purchase Agreement dated as of August 24,
1995 among Borrower, RIMCO Partners, L.P. II, RIMCO Partners, L.P. III
and RIMCO Partners, L.P. IV (the "Subordinated Debt") or make any other
payment or distribution of cash in respect of the Subordinated Debt when
any such payment would be prohibited pursuant to Section 9 of the
Subordinated Debt Agreement.

(o) Amendment of Subordinated Debt Agreement. Borrower will
not permit any amendment to, or alteration of, the Subordinated Debt
Agreement that would increase the amount of the Subordinated Debt,
change the interest rate thereon, change the maturity thereof, would
provide security for the Subordinated Debt, alter in any respect the
provisions relating to subordination of the

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<PAGE> 45
Subordinated Debt, alter in any respect the provisions regarding the
Borrower's ability or inability to make payment thereon, agree to any
waiver of any provision relating to any of the foregoing, or make any
other change which affects the senior status of the obligations owed
under this Agreement.

(p) Sale or Discount of Receivable. Borrower will not
discount or sell with recourse, or sell for less than the greater of the
face or market value thereof, any of its notes receivable or accounts
receivable.

14. EVENTS OF DEFAULT. Any one or more of the following events shall
be considered an "Event of Default" as that term is used herein:

(a) Borrower shall fail to pay when due or declared due the
principal of, and the interest on, the Note or any fee or any other
indebtedness of Borrower incurred pursuant to this Agreement or any
other Loan Document; or

(b) Any representation or warranty made by Borrower under this
Agreement, or in any certificate or statement furnished or made to Bank
pursuant hereto, or in connection herewith, or in connection with any
document furnished hereunder, shall prove to be untrue in any material
respect as of the date on which such representation or warranty is made
(or deemed made), or any representation, statement (including Financial
Statements), certificate, report or other data furnished or to be
furnished or made by Borrower under any Loan Document, including this
Agreement, proves to have been untrue in any material respect, as of the
date as of which the facts therein set forth were stated or certified;
or

(c) Default shall be made in the due observance or performance
of any of the covenants or agreements of Borrower contained in the Loan
Documents, including this Agreement (excluding covenants contained in
Section 13 of the Agreement for which there is no cure period) and such
default shall continue for more than thirty (30) days; or

(d) Default shall be made in the due observance or performance
of any of the covenants of the Borrower contained in Section 13 of this
Agreement; or

(e) Default shall be made in respect of any equipment lease
obligation or obligation for borrowed money, other than the Note
(including, without limitation, any subordinated indebtedness), for
which Borrower is liable (directly, by assumption, as guarantor or
otherwise), or any obligations secured by any mortgage, pledge or other
security interest, lien, charge or encumbrance with respect thereto, on
any asset or property of the Borrower or in respect of any

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<PAGE> 46
agreement relating to any such obligations, and such default shall
continue beyond the applicable grace period, if any; or

(f) Borrower shall commence a voluntary case or other
proceedings seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking an appointment of a
trustee, receiver, liquidator, custodian or other similar official of it
or any substantial part of its property, or shall consent to any such
relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take
any corporate action or authorizing the foregoing; or

(g) An involuntary case or other proceeding, shall be
commenced against Borrower seeking liquidation, reorganization or other
relief with respect to it or its debts under any bankruptcy, insolvency
or similar law now or hereafter in effect or seeking the appointment of
a trustee, receiver, liquidator, custodian or other similar official of
it or any substantial part of its property, and such involuntary case or
other proceeding shall remain undismissed and unstayed for a period of
sixty (60) days; or an order for relief shall be entered against the
Borrower under the federal bankruptcy laws as now or hereinafter in
effect; or

(h) A final judgment or order for the payment of money in
excess of $100,000.00 (or judgments or orders aggregating in excess of
$100,000.00) shall be rendered against Borrower and such judgments or
orders shall continue unsatisfied and unstayed for a period of thirty
(30) days; or

(i) In the event the aggregate principal amount outstanding
under the Note shall at any time exceed the Borrowing Base established
for the Note, Borrower shall fail to provide such additional Collateral
or prepay the principal of such Note, or either of them, in compliance
with the provisions of Section 9(b) hereof; or

(j) A Change of Control shall occur; or

(k) A Change of Management shall occur.

Upon occurrence of any Event of Default specified in Subsections 14(f)
and (g) hereof, the Revolving Commitment shall terminate and the entire
principal amount due under the Note and all interest then accrued thereon, and
any other liabilities of Borrower hereunder, shall become immediately due and
payable all without notice and without presentment, demand, protest, notice of
protest or dishonor or any other notice of default

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<PAGE> 47
of any kind, all of which are hereby expressly waived by Borrower. Upon the
occurrence and during the continuation of any other Event of Default, the Bank
may by notice to Borrower terminate the Revolving Commitment and declare the
principal of, and all interest then accrued on, the Note and any other
liabilities hereunder to be forthwith due and payable, whereupon the same shall
forthwith become due and payable without presentment, demand, protest or other
notice of any kind, all of which Borrower hereby expressly waives, anything
contained herein or in the Note to the contrary notwithstanding. Nothing
contained in this Section 14 shall be construed to limit or amend in any way
the Events of Default enumerated in the Note, or any other document executed in
connection with the transaction contemplated herein.

Upon the occurrence and during the continuance of any Event of Default,
the Bank is hereby authorized at any time and from time to time, without notice
to Borrower (any such notice being expressly waived by Borrower), to set-off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by either
of the Bank to or for the credit or the account of the Borrower against any and
all of the indebtedness of the Borrower under the Note and the Security
Instrument, including this Agreement, irrespective of whether or not the Bank
shall have made any demand under the Security Instrument, including this
Agreement or the Note and although such indebtedness may be unmatured. Any
amount set-off by either of the Bank shall be applied against the indebtedness
owed the Bank by Borrower pursuant to this Agreement and the Note. The Bank
agrees promptly to notify Borrower after any such setoff and application,
provided that the failure to give such notice shall not affect the validity of
such set-off and application. The rights of the Bank under this Section 14 are
in addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Bank may have. Within five (5) Business Days
after any such set-off or appropriation by the Bank, the Bank shall give
Borrower written notice thereof. However, a failure to give such notice will
not affect the validity of the set-off or appropriation.

15. EXERCISE OF RIGHTS. No failure to exercise, and no delay in
exercising, on the part of the Bank, any right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right. The
rights of the Bank hereunder shall be in addition to all other rights provided
by law. No modification or waiver of any provision of the Security Agreement,
including this Agreement, or the Note nor consent to departure therefrom, shall
be effective unless in writing, and no such consent or waiver shall extend
beyond the particular case and purpose involved. No notice or demand given in
any case shall constitute a waiver of the right to take other action in the
same, similar or other circumstances without such notice or demand.

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<PAGE> 48
16. NOTICES. Any notices or other communications required or
permitted to be given by this Agreement or any other documents and instruments
referred to herein must be given in writing (which may be by facsimile
transmission) and must be personally delivered or mailed by prepaid certified
or registered mail to the party to whom such notice or communication is
directed at the address of such party as follows: (a) BORROWER: BRIGHAM OIL &
GAS, L.P., 5949 Sherry Lane, Suite 1616, Dallas, Texas 75225, Facsimile No.
214-360-9825, Attention: Craig M. Fleming, Chief Financial Officer; (b) BANK:
BANK ONE, TEXAS, N.A., 1717 Main Street, Dallas, Texas 75201, Facsimile No.
214-290-2627, Attention: Mynan C. Feldman, Vice President. Any such notice or
other communication shall be deemed to have been given (whether actually
received or not) on the day it is personally delivered as aforesaid or, if
mailed, on the fifth day after it is mailed as aforesaid. Any party may change
its address for purposes of this Agreement by giving notice of such change to
the other party pursuant to this Section 16.

17. EXPENSES. The Borrower shall pay (i) all reasonable and
necessary out-of-pocket expenses of the Bank, including reasonable fees and
disbursements of special counsel for the Bank, in connection with the
preparation of this Agreement, any waiver or consent hereunder or any amendment
hereof or any default or Event of Default or alleged default or Event of
Default hereunder, (ii) all reasonable and necessary out-of-pocket expenses of
the Bank, including reasonable fees and disbursements of special counsel for
the Bank in connection with the preparation of any participation agreement for
a participant or participants requested by Borrower or any amendment thereof
and (iii) if a default or an Event of Default occurs, all reasonable and
necessary out-of-pocket expenses incurred by the Bank, including fees and
disbursements of counsel, in connection with such default and Event of Default
and collection and other enforcement proceedings resulting therefrom. The
Borrower shall indemnify the Bank against any transfer taxes, document taxes,
assessments or charges made by any governmental authority by reason of the
execution and delivery of this Agreement or the Note.

18. INDEMNITY. The Borrower agrees to indemnify and hold harmless
the Bank and its respective officers, employees, agents, attorneys and
representatives (singularly, an "Indemnified Party", and collectively, the
"Indemnified Parties") from and against any loss, cost, liability, damage or
expense (including the reasonable fees and out-of-pocket expenses of counsel to
the Bank, including all local counsel hired by such counsel) ("Claim") incurred
by the Bank in investigating or preparing for, defending against, or providing
evidence, producing documents or taking any other action in respect of any
commenced or threatened litigation, administrative proceeding or investigation
under any federal securities law, federal or state environmental law, or any
other statute of any jurisdiction, or any regulation, or at common law or
otherwise, which is alleged to arise out of or is based upon any acts,
practices or omissions or alleged acts, practices or omissions of the Borrower,
or its agents or arises in connection with the duties, obligations or
performance of the Indemnified Parties in negotiating, preparing, executing,
accepting, keeping,

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<PAGE> 49
completing, countersigning, issuing, selling, delivering, releasing, assigning,
handling, certifying, processing or receiving or taking any other action with
respect to the Loan Documents and all documents, items and materials
contemplated thereby even if any of the foregoing arises out of an Indemnified
Party's ordinary negligence. The indemnity set forth herein shall be in
addition to any other obligations or liabilities of the Borrower to the Bank
hereunder or at common law or otherwise, and shall survive any termination of
this Agreement, the expiration of the Loan and the payment of all indebtedness
of the Borrower to the Bank hereunder and under the Note, provided that the
Borrower shall have no obligation under this Section 18 to the Bank with
respect to any of the foregoing arising out of the gross negligence or willful
misconduct of the Bank. If any Claim is asserted against any Indemnified
Party, the Indemnified Party shall endeavor to notify the Borrower of such
Claim (but failure to do so shall not affect the indemnification herein made
except to the extent of the actual harm caused by such failure). The
Indemnified Party shall have the right to employ, at the Borrower's expense,
counsel of the Indemnified Parties' choosing and to control the defense of the
Claim. The Borrower may at its own expense also participate in the defense of
any Claim. Each Indemnified Party may employ separate counsel in connection
with any Claim to the extent such Indemnified Party believes it reasonably
prudent to protect such Indemnified Party. THE PARTIES INTEND FOR THE
PROVISIONS OF THIS SECTION 18 TO APPLY TO AND PROTECT EACH INDEMNIFIED PARTY
FROM THE CONSEQUENCES OF ANY LIABILITY INCLUDING STRICT LIABILITY IMPOSED OR
THREATENED TO BE IMPOSED ON SUCH INDEMNIFIED PARTY AS WELL AS FROM THE
CONSEQUENCES OF ITS OWN NEGLIGENCE OTHER THAN ITS GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT, WHETHER OR NOT THAT NEGLIGENCE IS THE SOLE, CONTRIBUTING, OR
CONCURRING CAUSE OF ANY CLAIM.

19. GOVERNING LAW. THIS AGREEMENT IS BEING EXECUTED AND DELIVERED,
AND IS INTENDED TO BE PERFORMED, IN DALLAS, TEXAS, AND THE SUBSTANTIVE LAWS OF
TEXAS SHALL GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION
OF THIS AGREEMENT AND ALL OTHER DOCUMENTS AND INSTRUMENTS REFERRED TO HEREIN,
UNLESS OTHERWISE SPECIFIED THEREIN.

20. CHOICE OF FORUM: CONSENT TO SERVICE OF PROCESS AND JURISDICTION.
THE OBLIGATIONS OF BORROWER UNDER THE LOAN DOCUMENTS ARE PERFORMABLE IN DALLAS
COUNTY, TEXAS. ANY SUIT, ACTION OR PROCEEDING AGAINST BORROWER WITH RESPECT TO
THE LOAN DOCUMENTS OR ANY JUDGMENT ENTERED BY ANY COURT IN RESPECT THEREOF, MAY
BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS, COUNTY OF DALLAS, OR IN THE
UNITED STATES COURTS LOCATED IN DALLAS, TEXAS AND BORROWER HEREBY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF SUCH COURTS FOR THE PURPOSE OF ANY SUCH SUIT,
ACTION OR PROCEEDING. BORROWER HEREBY IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN ANY SUIT, ACTION OR PROCEEDING IN SAID COURT BY THE MAILING THEREOF
BY BANK BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO BORROWER, AS
APPLICABLE, AT THE ADDRESS FOR NOTICES AS PROVIDED IN

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<PAGE> 50
SECTION 15. BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT BROUGHT IN THE COURTS LOCATED
IN THE STATE OF TEXAS, COUNTY OF DALLAS, AND HEREBY FURTHER IRREVOCABLY WAIVES
ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

21. INVALID PROVISIONS. If any provision of this Agreement is held
to be illegal, invalid, or unenforceable under present or future laws effective
during the term of this Agreement, such provisions shall be fully severable and
this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part of this Agreement, and the
remaining provisions of the Agreement shall remain in full force and effect and
shall not be affected by the illegal, invalid or unenforceable provision or by
its severance from this Agreement.

22. MAXIMUM INTEREST RATE. Regardless of any provisions contained in
this Agreement or in any other documents and instruments referred to herein,
the Bank shall never be deemed to have contracted for or be entitled to
receive, collect or apply as interest on the Note any amount in excess of the
maximum rate of interest permitted to be charged by applicable law, and in the
event the Bank ever receives, collects or applies as interest any such excess,
or if acceleration of the maturities of the Note or if any prepayment by
Borrower results in Borrower having paid any interest in excess of the maximum
rate, such amount which would be excessive interest shall be applied to the
reduction of the unpaid principal balance of the Note for which such excess was
received, collected or applied, and, if the principal balance of such Note is
paid in full, any remaining excess shall forthwith be paid to Borrower. All
sums paid or agreed to be paid to the Bank for the use, forbearance or
detention of the indebtedness evidenced by the Note and/or this Agreement
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full term of such indebtedness until
payment in full so that the rate or amount of interest on account of such
indebtedness does not exceed the maximum lawful rate permitted under applicable
law. In determining whether or not the interest paid or payable under any
specific contingency exceeds the maximum rate of interest permitted by law,
Borrower and the Bank shall, to the maximum extent permitted under applicable
law, (i) characterize any non-principal payment as an expense, fee or premium,
rather than as interest; and (ii) exclude voluntary prepayments and the effect
thereof; and (iii) compare the total amount of interest contracted for, charged
or received with the total amount of interest which could be contracted for,
charged or received throughout the entire contemplated term of the Note at the
maximum lawful rate under applicable law.

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<PAGE> 51
23. AMENDMENTS. This Agreement may be amended only by an instrument
in writing executed by an authorized officer of the party against whom such
amendment is sought to be enforced.

24. MULTIPLE COUNTERPARTS. This Agreement may be executed in a
number of identical separate counterparts, each of which for all purposes is to
be deemed an original, but all of which shall constitute, collectively, one
agreement. No party to this Agreement shall be bound hereby until a
counterpart of this Agreement has been executed by ail parties hereto.

25. CONFLICT. In the event any term or provision hereof is
inconsistent with or conflicts with any provision of the Security Instruments,
the terms or provisions contained in this Agreement shall be controlling.

26. SURVIVAL. All covenants, agreements, undertakings,
representations and warranties made in the Loan Documents, including this
Agreement, the Note or other documents and instruments referred to herein shall
survive all closings hereunder and shall not be affected by any investigation
made by any party.

27. PARTIES BOUND. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors, assigns,
heirs, legal representatives and estates, provided, however, that Borrower may
not, without the prior written consent of the Bank, assign any rights, powers,
duties or obligations hereunder.

28. PARTICIPATIONS. The Bank shall have the right at any time and
from time to time to sell one or more participations in the Note or any Advance
thereunder. To the extent of any such participation the provisions of this
Agreement shall inure to the benefit of, and be binding on, each participant,
including, but not limited to, any indemnity from Borrower to the Bank. The
Borrower shall have no obligation or liability to and no obligation to
negotiate or confer with, any participant, and Borrower shall be entitled to
treat the Bank as the sole owner of the Note without regard to notice or actual
knowledge of any such participation. Upon the occurrence of a default or an
Event of Default, each participant will have and is hereby granted the right to
setoff against and to appropriate and apply from time to time, without prior
notice to the Borrower or any other party, any such notice being hereby
expressly waived, any and all deposits (general or special or other
indebtedness or claims, direct or indirect, contingent or otherwise), at any
time held or owing by the participant to or for the credit or account of
Borrower against the payment of the note and any other obligations of the
Borrower hereunder; provided, however, none of the rights granted in this
Section 28 shall apply to any deposits held by any participant constituting
trust funds and so identified to such participant at the time the applicable
deposit account is created. Within five (5) Business Days after such setoff or
appropriation by a participant, that participant shall give Borrower and Bank
written notice thereof.

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<PAGE> 52
However, a failure to give such notice will not affect the validity of this
setoff or appropriation.

29. FINANCIAL TERMS. All accounting terms used in this Agreement
which are not specifically defined herein shall be construed in accordance with
GAAP.

30. OTHER AGREEMENTS. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

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

BORROWER:

BRIGHAM OIL & GAS, L.P.,
a Delaware limited partnership

By: BRIGHAM EXPLORATION COMPANY
its managing general partner

By:/s/ ANNE L. BRIGHAM
---------------------------
Anne L. Brigham,
Executive Vice President

BANK:

BANK ONE, TEXAS, N.A.,
a national banking association

By:/s/ MYNAN C. FELDMAN
----------------------------------
Mynan C. Feldman
Vice President

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<PAGE> 1
EXHIBIT 10.12.1

REVOLVING NOTE

$25,000,000.00 Dallas, Texas April 1, 1996

FOR VALUE RECEIVED, the undersigned, BRIGHAM OIL & GAS, L.P., a
Delaware limited partnership (hereinafter referred to as the "Borrower") hereby
unconditionally promises to pay to the order of BANK ONE, TEXAS, N.A., a
national banking association (the "Bank") the principal sum of TWENTY-FIVE
MILLION AND NO/100 DOLLARS ($25,000,000.00) or so much thereof as may be
advanced to or for the benefit of the Borrower pursuant to the Loan Agreement
(as hereinafter defined), in lawful money of the United States of America
together with interest from the date hereof until paid at the rates specified
in the Loan Agreement. All past due principal and interest on this Note shall
bear interest from the date of maturity until paid at a rate of interest equal
to the Base Rate plus five percent (5%). All payments of principal and
interest due hereunder are payable at the offices of Bank at 1717 Main Street,
4th Floor, Bank One Center, P.O. Box 655415, Dallas, Texas 75265-5415,
attention: Energy Department, or at such other address as Bank shall designate
in writing to Borrower.

The principal and all accrued interest on this Note shall be due and
payable in accordance with the terms and provisions of the Loan Agreement.

This Note is executed pursuant to that certain Loan Agreement dated of
even date herewith between Borrower and Bank (the "Loan Agreement"), and is the
Note referred to therein. Reference is made to the Loan Agreement and the Loan
Documents (as that term is defined in the Loan Agreement) for a statement of
prepayment, rights and obligations of Borrower, for a statement of the terms
and conditions under which the due date of this Note may be accelerated and for
statements regarding other matters affecting this Note (including without
limitation the obligations of the holder hereof to advance funds hereunder,
principal and interest payment due dates, voluntary and mandatory prepayments,
exercise of rights and remedies, payment of attorneys' fees, court costs and
other costs of collection and certain waivers by Borrower and others now or
hereafter obligated for payment of any sums due hereunder). Upon the
occurrence of an Event of Default, as that term is defined in the Loan
Agreement and used in the Loan Documents, the holder hereof (i) may declare
forthwith to be entirely and immediately due and payable the principal balance
hereof and the interest accrued hereon, and (ii) shall have all rights and
remedies of the Bank under the Loan Agreement and Loan Documents. This Note
may be prepaid in accordance with the terms and provisions of the Loan
Agreement.

Regardless of any provision contained in this Note, the holder hereof
shall never be entitled to receive, collect or apply, as interest on this Note,
any amount in excess of the Maximum Rate (as such term is defined in the Loan
Agreement), and, if the holder hereof ever receives, collects, or applies as
interest, any such amount which would be excessive interest, it shall be deemed
a partial prepayment of principal and treated hereunder as such; and, if the
indebtedness evidenced hereby is paid in full, any remaining excess shall
forthwith be paid to Borrower. In determining whether or not the interest paid
or payable, under any specific contingency, exceeds the Maximum Rate, Borrower
and the holder hereof shall, to the maximum extent permitted under applicable
law (i) characterize any
<PAGE> 2
non-principal payment as an expense, fee or premium rather than as interest,
(ii) exclude voluntary prepayments and the effects thereof, and (iii) spread
the total amount of interest throughout the entire contemplated term of the
obligations evidenced by this Note and/or referred to in the Loan Agreement so
that the interest rate is uniform throughout the entire term of this Note;
provided that, if this Note is paid and performed in full prior to the end of
the full contemplated term thereof; and if the interest received for the actual
period of existence thereof exceeds the Maximum Rate, the holder hereof shall
refund to Borrower the amount of such excess or credit the amount of such
excess against the indebtedness evidenced hereby, and, in such event, the
holder hereof shall not be subject to any penalties provided by any laws for
contracting for, charging, taking, reserving or receiving interest in excess of
the Maximum Rate.

If any payment of principal or interest on this Note shall become due
on a day other than a Business Day (as such term is defined in the Loan
Agreement), such payment shall be made on the next succeeding Business Day and
such extension of time shall in such case be included in computing interest in
connection with such payment.

If this Note is placed in the hands of an attorney for collection, or
if it is collected through any legal proceeding at law or in equity or in
bankruptcy, receivership or other court proceedings, Borrower agrees to pay all
costs of collection, including, but not limited to, court costs and reasonable
attorneys' fees.

Borrower and each surety, endorser, guarantor and other party ever
liable for payment of any sums of money payable on this Note, jointly and
severally waive presentment and demand for payment, notice of intention to
accelerate the maturity, protest, notice of protest and nonpayment, as to this
Note and as to each and all installments hereof, and agree that their liability
under this Note shall not be affected by any renewal or extension in the time
of payment hereof, or in any indulgences, or by any release or change in any
security for the payment of this Note, and hereby consent to any and all
renewals, extensions, indulgences, releases or changes.

This Note shall be governed by and construed in accordance with the
applicable laws of the United States of America and the laws of the State of
Texas.

THIS WRITTEN NOTE, THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENTS BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR

-2-
<PAGE> 3
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.

BRIGHAM OIL & GAS, L.P.,
a Delaware limited partnership

By: BRIGHAM EXPLORATION COMPANY
its managing general partner

By:
----------------------------------
Anne L. Brigham,
Executive Vice President

-3-

<PAGE> 1

EXHIBIT 10.12.2
ATTENTION ____________________ COUNTY CLERK:
Recording requested by and when recorded mail to:

BANK ONE, TEXAS, N.A.
c/o Robert N. Rule, Jr., Esq.
Locke Purnell Rain Harrell, P.C.
2200 Ross Avenue, Suite 2200
Dallas, Texas 75201

MORTGAGE, SECURITY AGREEMENT,
ASSIGNMENT OF PRODUCTION AND FINANCING STATEMENT
(Line of Credit Mortgage)

THE STATE OF NEW MEXICO )
) KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF LEA )

WHEREAS, Brigham Oil & Gas, L.P., a Delaware limited partnership, the
address of which is 5949 Sherry Lane, Suite 1616, Dallas, Texas
75225(hereinafter referred to as "Grantor"), does hereby execute and deliver
this Mortgage, Security Agreement, Assignment of Production and Financing
Statement (hereinafter referred to as the "Mortgage"), for the use and benefit
of BANK ONE, TEXAS, N. A., a national banking association (hereinafter referred
to as "Bank"), with its address at P. 0. Box 655415, Dallas, Texas 75265-5415;
covering oil and gas properties and interests, and related personal properties,
therein described located on land situated in the State of New Mexico;

NOW, THEREFORE, for and in consideration of the sum of $10.00 and
other good and valuable consideration, in hand paid by Bank to Grantor, the
receipt and sufficiency of which is hereby acknowledged and confessed, Grantor
does hereby GRANT, MORTGAGE, BARGAIN, SELL, TRANSFER, ASSIGN and CONVEY unto
Bank, all right, title and interest now or at any time hereafter vested in
Grantor in and to the following described properties and interests, to wit:

(a) All oil, gas and mineral interests and other
interests and property of every kind and character described and
referred to in Exhibit "A" attached hereto and made a part hereof by
reference for all purposes as if copied herein in full;

(b) Any and all operating agreements (including so-called
"working interest units" created under operating agreements or
otherwise), communitization agreements, unitization agreements,
pooling agreements, declarations of pooled units, all units created
under orders, regulations, rules or other official acts of any
federal, state or other governmental body or regulatory agencies
providing for pooling and unitization, spacing orders or other well
permits and other instruments, whether now or hereafter made, and the
units created thereby, which relate to any of the properties and
interests described or referred to in Exhibit "A", whether or not such
agreements, orders or instruments are described in Exhibit "A";

(c) All real property described or referred to in Exhibit
"A" and the real property described or referred to in Exhibit "A"
(hereinafter collectively referred to as the "Lands"), even though
Grantor's rights, titles and interests in such Lands be incorrectly or
insufficiently described or referred to therein, or a description of a
part or all of such rights, titles and interests be omitted from
Exhibit "A";

(d) Any and all oil, gas and mineral leases described or
referred to in Exhibit "A" (herein collectively referred to as the
"Leases") and any and all other oil, gas and mineral leases insofar as
they cover all or any part of the Lands together with all right, title
and interest now or at any time hereafter vested in Grantor in and to
any and all overriding royalty interests, mineral interests, royalty
interests, net profit interests, oil payments, production payments and
all other interests and properties of every kind and character insofar
as they cover any of the Lands or the Leases insofar as the Leases
cover the Lands, even though such rights, titles and interests be
incorrectly or insufficiently described or referred to therein, or a
description of a part or all of such rights, titles and interests be
omitted from
<PAGE> 2
Exhibit "A", together with any and all renewals, extensions,
substitutions, ratifications, supplements, amendments and replacements
of and for any of the Leases or other interests described or referred
to herein insofar as the same cover the Lands;

(e) All personal property, fixtures, hereditaments,
improvements, easements, permits, licenses, servitudes, surface leases
and rights-of-way situated upon or used or useful or held for use in
connection with the exploration, development or operation of the
foregoing properties and interests, or the production, treating,
storing or transportation of oil, gas and other hydrocarbons
therefrom, including, without limitation, liquid extraction plants,
plant compressors, field gathering systems, valves, fittings, engines,
boilers, meters, cables, wires, towers tubing and rods, casing,
connections, tanks and tank batteries, separators, lines, pumps,
pipes, pipelines, structures, buildings, sheds, oil wells, gas wells,
injection wells, other wells, fixtures, tools, machinery and other
equipment, power lines, telephone and telegraph lines, and other
appurtenances, apparatus, appliances and property of every kind and
character, movable or immovable now or at any time hereafter located
on the Lands, or which may now or hereafter be used or obtained in
connection therewith, whether or not the same are described or
referred to in Exhibit "A", together with all additions,
substitutions, replacements, accessions and attachments to any and all
of the foregoing properties;

(f) All oil, casinghead gas and gas sales, purchase,
exchange and processing contracts and agreements, and all other
contracts, agreements and instruments, whether now in existence or
hereafter made, which relate to (but only to the extent the same
relate to) any of the properties and interests described or referred
to in Exhibit "A", whether or not such contracts and agreements are
described or referred to in Exhibit "A", together with any and all
renewals, extensions, substitutions, ratifications, supplements,
amendments and replacements of or for any such contracts, agreements
and instruments to the extent such relate to such properties and
interests;

(g) All oil, gas and other hydrocarbons, including,
without limitation, casinghead gas, condensate, distillate, liquid
hydrocarbons, gaseous hydrocarbons, and all products separated,
settled and dehydrated therefrom, and all products refined therefrom,
including, without limitation, kerosene, liquified petroleum gas,
refined lubricating oils, diesel fuel, drip gasoline and natural
gasoline, and all other minerals, and the proceeds thereof, produced
and to be produced from and which accrue or are attributable to any of
the above described or referenced properties and interests, by virtue
of the above described or referenced contracts, agreements and
instruments; and

(h) Any and all proceeds, rents, issues, profits,
products, revenues and other income arising from or by virtue of the
sale, lease or other disposition or, or from any insurance payable
with respect to damage, loss or destruction of, the collateral
described in Subparagraphs (a) through (g) above.

It is expressly understood and agreed by the parties hereto that any
and all decimal fractional interests and/or well names set out in Exhibit "A"
pertaining to any of the properties and interests described or referred to in
Exhibit "A" have been appended for informational purposes only and shall not
limit in any way whatsoever the interest of Grantor in such properties and
interests, or interests derived thereunder, which are subject to this Mortgage.
It is also expressly understood and agreed by the parties hereto that any and
all references to township and range included in the descriptions set out in
Exhibit "A" attached hereto are based upon reference to the New Mexico Prime
Meridian.

Grantor's interests in the properties and interests described in
Subparagraphs (a) through (h) above are all hereinafter sometimes collectively
referred to as the "Mortgaged Properties

TO HAVE AND TO HOLD the Mortgaged Properties, together with all the
rights, hereditaments and appurtenances in anywise appertaining or belonging
thereto, unto Bank and its successors or substitutes in this trust, and its and
their assigns, in trust and for the uses and purposes hereinafter set forth,
forever.

The term "Grantor's Successors", as used herein, shall mean Grantor's
heirs, executors, legal representatives, successors and assigns. Grantor
hereby binds Grantor and Grantor's Successors to warrant and forever defend,
all and singular, the Mortgaged Properties, subject to the Permitted Liens (as
defined in the Loan Agreement), unto Bank and its successors or substitutes in
this trust, and its and their assigns, forever, against every person whomsoever
lawfully claiming or to claim the same or any part thereof.

- 2 -
<PAGE> 3
As used herein, the term "Loan Agreement" shall mean that certain Loan
Agreement of even date herewith between Grantor and Bank.

ARTICLE 1
REPRESENTATIONS AND WARRANTIES

1.1 Grantor hereby expressly represents and warrants to Bank that
(a) the Leases are in full force and effect; (b) Grantor's interests in the
Leases are valid and subsisting on the Lands and entitle Grantor to receive
that proportion (indicated as the "NRI") of the total production from the
Mortgaged Properties indicated in connection with the descriptions thereof in
Exhibit "A", subject to matters disclosed in Exhibit A and to Permitted Liens,
which altogether do not cause the working interests of Grantor to be greater
than or the net revenue interests of Grantor to be less than indicated on
Exhibit A; (c) Grantor has good, valid and indefeasible title to Grantor's
interest in the Leases and to Grantor's interest in the personal property and
fixtures comprising a part of the Mortgaged Properties or used or obtained in
connection therewith, except for Permitted Liens (as defined in the Loan
Agreement) and except as expressly provided in Exhibit "A" and the right, power
and authority to execute and deliver this Mortgage and convey the Mortgaged
Properties; (d) the Mortgaged Properties are free and clear of all claims,
liens, encumbrances, security interests, contracts, agreements, options,
preferential purchase rights or other restrictions or limitations of any nature
or kind, except for Permitted Liens (as defined in the Loan Agreement) and
except as expressly provided herein; (e) all rentals, royalties and other
amounts due and payable under the Leases have been duly paid, and obligations
to be performed under the Leases as to the Lands have been duly performed; (f)
the holder shall quietly enjoy and possess the Mortgaged Properties; (g)
Grantor is not a party to, and none of the hydrocarbons produced from any of
the wells located on the Leases are the subject of, any Advance Payment
Contract affecting or relating to any of the Mortgaged Properties. As used
herein, the term "Advance Payment Contract" means any contract whereby Grantor
either (1) receives or becomes entitled to receive (either directly or
indirectly to a third party for Grantor's account or benefit) any payment (an
"Advance Payment") to be applied toward payment of the purchase price of
hydrocarbons produced or to be produced from any of the Mortgaged Properties
and which Advance Payment is paid in advance of actual delivery of such
production to or for the account of the purchaser regardless of such
production, or (2) grants an option or right of refusal to the purchaser to
take delivery of such production in lieu of payment, and, in either of the
foregoing instances, the Advance Payment is, or is to be, applied as payment in
full for such production when sold and delivered or is, or is to be, applied as
payment for a portion only of the purchase price thereof or of a percentage or
share of such production; provided that (A) inclusion of the standard "take or
pay" provision in any gas sales or purchase contract shall not, in and of
itself, constitute such contract as an Advance Payment Contract for the
purposes hereof and (B) neither a hedging, swap or other similar arrangement,
nor a gas balancing agreement shall constitute an Advance Payment Contract; (h)
Grantor and any guarantor of the Secured Indebtedness (hereinafter defined) are
now in a solvent condition; (i) no bankruptcy or insolvency proceedings are
pending, or contemplated or threatened by or against Grantor and any guarantor
of the Secured Indebtedness; and (j) no other judicial or administrative
actions, suits or proceedings are pending, contemplated or threatened by or
against Grantor and any guarantor of the Secured Indebtedness.

ARTICLE 2
SECURED INDEBTEDNESS

2.1 This Mortgage is given to secure payment and performance of
the following indebtedness, obligations and liabilities, to wit:

(a) That certain Revolving Note, dated April 1, in the
original principal amount of TWENTY-FIVE MILLION and No/100 Dollars
($25,000,000.00), executed by Grantor, as maker, payable to the order
of Bank, bearing interest as provided therein and containing usual and
customary provisions for collection and attorneys' fees (hereinafter
referred to as the "Note"), and any and all renewals, increases,
refundings, substitutions, replacements, consolidations and/or
extensions of or for the Note, or any part thereof;

(b) All indebtedness, obligations and liabilities of
Grantor arising pursuant to the provisions of any loan agreement,
whether now existing or hereafter arising, executed or to be executed
by and between Grantor and Bank, including, without limitation, the
Loan Agreement, and all supplements, amendments, restatements,
modifications and replacements thereof or therefor, together with any
and all renewals, increases, refundings, substitutions, replacements,
consolidations and/or extensions of or for any such indebtedness,
obligations and liabilities, or any part thereof;

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<PAGE> 4
(c) All indebtedness, obligations and liabilities arising
pursuant to the provisions of this Mortgage, and any and all other
mortgages, indentures, security agreements, pledge agreements,
collateral mortgages, collateral chattel mortgages, assignments, or
other conveyances, whether now existing or hereafter arising, and all
supplements, amendments, restatements, modifications and replacements
thereof or therefor, executed or to be executed by Grantor or any
guarantor of the Secured Indebtedness to secure the Secured
Indebtedness, or for the use and benefit of Bank, together with any
and all renewals, increases, refundings, substitutions, replacements,
consolidations and/or extensions of or for any such indebtedness,
obligations and liabilities, or any part thereof (hereinafter
collectively referred to as the "Security Instruments");

(d) All loans and advances which Bank may hereafter make
to Grantor, and any and all renewals, increases, refundings,
substitutions, replacements, consolidations and/or extensions of any
and all such loans and advances, or any part thereof; and

(e) All other and additional debts, obligations and
liabilities of every kind and character of Grantor, now existing or
hereafter arising in favor of Bank, regardless of whether such debts,
obligations and liabilities are direct or indirect, primary or
secondary, joint, several or joint and several, fixed or contingent,
and regardless of whether such present or future debts, obligations
and liabilities may, prior to their acquisition by Bank, be or have
been payable to, or be or have been in favor of, some other persons or
have been acquired by Bank in a transaction with one other than
Grantor, together with any and all renewals, increases, refundings,
substitutions, replacements, consolidations and/or extensions of or
for any and all such debts, obligations, and liabilities, or any part
thereof (it being contemplated that Bank may lend additional sums of
money to Grantor from time to time, but shall not be obligated to do
so, and that all such additional sums and loans shall be part of the
"Secured Indebtedness" as hereinafter defined).

The term "Secured Indebtedness", as used herein, shall mean all of the
indebtedness, obligations and liabilities described or referred to above in
Subsections (a) through (e), inclusive, of this Section 2.1. The term
"holder", as used herein, shall mean the holder or holders of the Secured
Indebtedness or any part thereof.

2.2 The Secured Indebtedness shall not exceed $25,000,000.00,
which shall be the maximum amount secured at any one time hereby.

ARTICLE 3
COVENANTS

3.1 The covenants, agreements and undertakings of Grantor
contained in this Mortgage, whether in this Article 3 or elsewhere, are made by
Grantor for Grantor and Grantor's Successors.

3.2 Grantor hereby covenants, agrees and specifically undertakes
hereby:

(a) In all material respects to maintain, preserve and
keep or cause to be maintained, preserved and kept Grantor's interests
in the Mortgaged Properties and all appurtenances thereto, including,
without limitation, all buildings, improvements, machinery, equipment,
pipelines, fixtures and other personal property of every kind and
character, in respect of the Leases, in thorough repair, working order
and condition, and from time to time, at Grantor's own expense, do or
cause to be done all necessary and proper repairs, renewals,
replacements and substitutions of the Mortgaged Properties and all
appurtenances thereto, so that at all times the state and condition of
the Mortgaged Properties and all appurtenances thereto will be fully
preserved and maintained;

(b) To the extent Grantor has the right to do so, permit
or cause to be permitted the holder, its agents, employees and
representatives, at their own risk, to go upon, examine, inspect and
remain on the Mortgaged Properties, and to go upon the derrick floor
of any well or wells at any time drilled or being drilled thereon, and
to strap, gauge, measure and inspect any and all tanks at any time on
the Mortgaged Properties or holding oil, gasoline or casinghead
gasoline therefrom; and Grantor shall do or cause to be done all
things necessary and/or proper to enable the holder to exercise said
rights whenever it so desires information so obtained shall be subject
to the Bank's obligations to maintain confidentiality as provided in
Section 12(i) of the Loan Agreement;

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(c) To promptly notify the holder in writing if the
validity or priority of this Mortgage or any of the rights, titles,
liens or security interests created or evidenced hereby with respect
to the Mortgaged Properties, or any part thereof, shall be questioned
attacked or endangered, directly or indirectly, and do or cause to be
done all things necessary and/or proper to protect, warrant and defend
title to the Mortgaged Properties unto the holder and its successors
and assigns at Grantor's sole expense against all persons whomsoever
claiming an interest therein or a lien or security interest thereon,
but the holder shall have the right, at any time, to intervene in any
suit affecting such title and to employ independent counsel in
connection with any such suit to which it may be a party by
intervention or otherwise; and upon demand Grantor agrees to pay the
holder all reasonable expenses paid or incurred by it in respect of
any such suit affecting title to any such property or affecting the
holder's rights, titles, liens or security interests hereunder,
including, without limitation, reasonable fees to the holder's
attorneys, and Grantor will indemnify and hold the holder harmless
from and against any and all costs and expenses, including, without
limitation, any and all costs, loss, damage or liability which the
holder may suffer or incur by reason of the failure of the title to
all or any part of the Mortgaged Properties, or by reason of the
failure or inability of Grantor, for any reason, to convey the rights,
titles, liens and security interests which this Mortgage purports to
mortgage, create or assign, and all amounts at any time so payable by
Grantor shall be secured by the lien and security interest hereof and
by the assignment of production herein contained;

(d) At any time and from time to time, upon request by
the holder and at Grantor's sole expense, forthwith to execute and
deliver or cause to be executed and delivered to the holder and to
record, file or register, any and all additional instruments and
further assurances as may be necessary or proper, in the holder's
opinion, to effect the intent of these presents;

(e) To promptly furnish the holder with the financial
information, statements, and reports required to be furnished under
the Loan Agreement;

(f) To pay all Secured Indebtedness in accordance with
the terms thereof or hereof, or when the maturity thereof be
accelerated in accordance with the terms thereof or hereof;

(g) To promptly pay and discharge or cause to promptly
paid and discharged all rentals, delay rentals, royalties and
indebtedness accruing under, and to perform or cause to be performed
in all material respects each and every act, matter or thing required
by each and all of the assignments, deeds, Leases, subleases,
contracts and agreements comprising a part of or affecting Grantor's
interests in the Mortgaged Properties, and to do or cause to be done
all other things necessary to keep unimpaired in all material respects
Grantor's rights with respect thereto and to prevent any forfeiture
thereof or default thereunder; provided, however, that nothing in this
Mortgage shall be deemed to (1) require the Grantor to perpetuate or
renew any oil and gas lease or other lease by payment of rental or
delay rental or by commencement or continuation of operations, or (2)
prevent the Grantor from abandoning or releasing any oil and gas
lease, other lease or well thereon, when in any of such events, in the
opinion of Grantor, exercised in good faith, it is not in the best
interest of Grantor to perpetuate same;

(h) To do or cause to be done such development work as
may be reasonably necessary to the prudent and economical operation of
the Mortgaged Properties in accordance with the generally accepted
practices of prudent operators in the industry, including all actions
that may be appropriate to protect from diminution the productive
capacity of each producing well on the Mortgage Properties (including,
without limitation, cleaning out and a reconditioning wells) and to
protect the Mortgaged Properties against drainage whenever, and as
often as, is necessary;

(i) To promptly correct and cure any defect, error or
omission which may be discovered in the contents of this Mortgage or
in any other Security Instrument or in the execution or
acknowledgement hereof or thereof and in connection therewith,
promptly execute, acknowledge and deliver to the holder any and all
such corrective or curative instruments as the holder may in its sole
and absolute discretion deem necessary or appropriate, and pay all
costs and expenses, including, without limitation, the reasonable
attorneys' fees of the holder, in connection with any of the
foregoing; and

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<PAGE> 6
(j) To comply in all respects with the affirmative and
negative covenants contained in the Loan Agreement, as the same may be
supplemented, amended, modified and replaced from time to time.

3.3 Any and all covenants contained in this Mortgage may from time
to time, by instrument in writing signed by the holder and delivered to
Grantor, be waived to such extent and in such manner as the holder may consider
appropriate; but no such waiver shall at any time affect or impair the holder's
rights or liens hereunder, except to the extent so specifically stated in such
written instrument.

3.4 As to any part of the Mortgaged Properties which may be
comprised of interests in the Leases which are other than working interests or
which may be operated by a party or parties other than Grantor, Grantor's
covenants as expressed in this Article 3 are modified to require that Grantor
use reasonable efforts to obtain compliance with such covenants by the working
interest owners or the operator or operators of such Leases or properties,
including, without limitation, the exercise by Grantor of all rights under any
operating agreements to which Grantor is a party.

ARTICLE 4
DEFAULTS AND REMEDIES

4.1 The term "Event of Default", as used herein, shall mean the
occurrence of any one or more of the following events:

(a) The occurrence of any Event of Default, as that term
is defined in the Loan Agreement;

(b) The failure or refusal of Grantor to pay all or any
part of the Note as and when due in accordance with its terms;

(c) The failure or refusal of Grantor punctually and
properly to observe, keep and perform any covenant, agreement or
undertaking contained in this Mortgage or any of the Security
Instruments;

(d) The title of Grantor or Bank to the Mortgaged
Properties, or a substantial part thereof, becomes in any manner
affected or impaired or becomes the subject matter of litigation
which, in the good faith opinion of Bank, would likely result in
substantial impairment or loss of the lien and security interest
intended to be created by this Mortgage; or

(e) Any representation or warranty set forth in this
Mortgage or in any of the Security Instruments shall be determined to
be false or misleading in any respect.

then upon the occurrence of any such Event of Default, Mortgagor shall be in
default hereunder and the Bank may declare all of the Secured Indebtedness to
be forthwith due and payable whereupon the same shall forthwith become due
without presentment, demand, protest, notice of intent to accelerate and notice
of acceleration or other notice of any kind, all of which mortgagor hereby
expressly waives. The Bank may thereupon avail itself of any of its legal and
equitable rights and remedies, either by the institution of a suit or suits, in
equity or at law, or in bankruptcy, in any court or courts of competent
jurisdiction, whether for the specific performance of any covenant, undertaking
or agreement contained herein or in the aid of any execution of any powers
granted herein, or for any foreclosure hereof or hereunder, or for any sale of
the Mortgaged Properties, or any part thereof, so far as may be authorized by
law, or for the enforcement of such other or additional appropriate legal or
equitable remedies as the Bank may deem most effectual to protect and enforce
the aforesaid rights.

4.2 If Grantor should fail, refuse or be unable to pay any sum of
money herein covenanted to be paid by Grantor, or fail, refuse or be unable to
observe, keep or perform any additional covenant, agreement or undertaking
whatsoever contained in this Mortgage, the holder may, but shall not be
obligated to, pay said sums of money, or perform or attempt to perform any such
covenant, agreement or undertaking and any such payment so made or expense
reasonably incurred in the performance or attempted performance of any such
covenant, agreement or undertaking shall be, and is hereby declared by Grantor
to be, a part of the Secured Indebtedness, and Grantor promises, upon demand,
to pay to the holder at the office of Bank set forth hereinabove all sums so
advanced or paid by the holder, with interest at the Default Rate (as defined
in the Loan Agreement) from the date paid or incurred by the holder. No such
payment by the holder shall in any way be considered or constitute a waiver of
any such default or of the holder's right to declare the Secured Indebtedness
at once due

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<PAGE> 7
and payable. In addition to the lien and security interest hereof, the holder
shall be subrogated to all rights and liens securing the payment of any debt,
claim, tax or assessment for the payment of which it shall have made such
advance.

4.3 Upon the occurrence of an Event of Default, and if each Event
of Default is continuing, (i) Grantor shall be in default hereunder and the
entire principal amount of and all interest then accrued on the Note, and any
other obligations, indebtedness and liabilities hereunder, shall become
immediately due and payable, all without notice and without presentment,
demand, protest, notice of protest or dishonor, notice of intent to accelerate
and notice of acceleration, or any other notice of default of any kind, all of
which are hereby expressly waived by Grantor, and (ii) in any other such event,
Grantor shall be in default hereunder, and Bank may, at its option, declare the
principal of and all interest then accrued on the Note, and any other
obligations, indebtedness and liabilities hereunder to be forthwith due and
payable whereupon the same shall forthwith become due without presentment,
demand, protest, notice of intent to accelerate and notice of acceleration or
other notice of any kind, all of which Grantor hereby expressly waives,
anything contained herein or in the Note to the contrary notwithstanding.
Nothing contained in this Article 4 shall be construed to limit or amend in any
way the Events of Default enumerated in any other document executed in
connection with the transaction contemplated herein or hereby. Bank may
thereupon avail itself of any of its legal and equitable rights and remedies,
either by the institution of a suit or suits, in equity or at law, or in
bankruptcy, in any court or courts of competent jurisdiction, whether for the
specific performance of any covenant, undertaking or agreement contained herein
or in the aid of any execution of any powers granted herein, or for any
foreclosure hereof or hereunder, or for any sale of the Mortgaged Properties,
or any part thereof, so far as may be authorized by law, or for the enforcement
of such other or additional appropriate legal or equitable remedies as Bank may
deem most effectual to protect and enforce the aforesaid rights.

4.4 Upon the occurrence of an Event of Default, and if such Event
of Default is continuing, the holder may, at its option, and is hereby
authorized, prior or subsequent to the exercise of any remedies under Section
4.4 hereof, to enter upon the Mortgaged Properties, or any part thereof, and to
take possession of the Mortgaged Properties in the possession of Grantor or
Grantor's Successors, and may exclude Grantor or Grantor's Successors, and all
persons claiming under Grantor, wholly or partly therefrom; and, holding the
same, the holder may exercise without interference from Grantor or Grantor's
Successors, any and all rights which Grantor has with respect to the
management, possession, operation, protection or preservation of the Mortgaged
Properties, and the holder may use, administer, manage, operate and control the
Mortgaged Properties and conduct the business thereof to the same extent as
Grantor or Grantor's Successors might at the time do and may exercise all
rights and powers of Grantor, in the name, place and stead of Grantor, or
otherwise as the holder shall deem best. All reasonable costs, expenses and
liabilities of every character incurred by the holder shall be a demand
obligation owed by Grantor to holder and shall bear interest at the rate
specified in Section 4.2 hereof and shall constitute a portion of the Secured
Indebtedness and shall be secured by this Mortgage and all of the Security
Instruments. If necessary to obtain the possession provided for hereinabove,
the holder, as the case may be, may invoke any one or more actions for forcible
entry and detainer, trespass to try title and restitution. In connection with
any action taken by the holder pursuant to this Section 4.4, the holder shall
not be liable for any loss sustained by Grantor resulting from any act or
omission of the holder in managing the Mortgaged Properties, unless such loss
is caused by the willful misconduct or bad faith of the holder. Grantor hereby
agrees to indemnify and hold harmless the holder from and against any and all
liability, loss or damage which may be incurred by reason of the exercise of
rights or remedies hereunder. Should the holder incur any such liability by
reason of this Mortgage or the exercise of rights or remedies hereunder or in
defense of any such claims or demands, the amount thereof, including without
limitation, costs, expenses and reasonable attorneys' fees, shall be a demand
obligation owing by Grantor to the holder and shall bear interest each day from
the date incurred until paid at the rate specified in Section 4.2 hereof and
shall be a part of the Secured Indebtedness and shall be secured by this
Mortgage and all of the Security Instruments. Grantor hereby consents to,
ratifies and confirms any and all actions of the holder with respect to the
Mortgaged Properties taken under this Section 4.4.

4.5 The Bank may institute suit to foreclose this Mortgage in any
court having jurisdiction. In any such suit the Bank may, at its option, apply
for and be entitled to, as a matter or right and without proof of insolvency,
fraud, insecurity, or mismanagement on the part of the Grantor, the appointment
of a receiver to take possession of, operate, and preserve the Mortgaged
Properties. Grantor agrees that such receiver may be appointed to take
possession of, hold, maintain, operate and preserve said property, including
the production and sale of all oil, gas and other minerals therefrom, and apply
the proceeds of the sale thereof to the payment of the Secured Indebtedness due
the Bank until such Secured Indebtedness and costs are fully paid; and said

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<PAGE> 8
receiver may be authorized to sell and dispose of said property under orders of
the court appointing him such receiver.

4.6 Bank is authorized to receive the proceeds of said sale or
sales made pursuant to Section 4.3 or Section 4.5 hereof and apply the same as
follows: First, to the payment of all necessary costs and expenses incident to
the execution of said trust, including but not limited to all court costs and
charges of every character in the event foreclosure is by suit; Second, to the
payment of the Secured Indebtedness in such order as the holder shall elect;
and Third, the balance, if any, remaining after the full and final payment of
the Secured Indebtedness, to Grantor or Grantor's Successors.

4.7 It is agreed that in any deed or deeds given pursuant to the
exercise of a power of sale, any and all statements of fact or other recitals
therein made as to the identity of the holder or as to the occurrence or
existence of any default, or as to the acceleration of the maturity of the
Secured Indebtedness, or as to the request to sell, notice of sale, time,
place, terms and manner of sale, and receipt, distribution and application of
the money realized therefrom, and, without being limited by the foregoing, as
to any act or thing having been duly done by the holder, or any of them if
there be more than one, shall be taken by all courts of law and equity as prima
facie evidence that the said statements of recitals state facts and are without
further question to be so accepted, and Grantor does hereby ratify and confirm
any and all acts that Bank may lawfully do in the premises by virtue hereof.

4.8 In case the lien and security interest hereof shall be
foreclosed by judicial action, the purchaser at any sale shall receive, as an
incident to its ownership, immediate possession of the property purchased, and
Grantor agrees for Grantor and for all persons claiming under Grantor, that if
Grantor or any such person shall hold possession of said property, or any part
thereof, subsequent to foreclosure, Grantor or the parties so holding
possession shall be considered as tenants at sufferance of the purchaser at
foreclosure sale, and anyone occupying the property after demand for possession
thereof shall be guilty of forcible detainer and shall be subject to eviction
and removal, forcible or otherwise, with or without process of law, and all
damages by reason thereof are hereby expressly waived.

4.9 Upon the occurrence of an Event of Default, and if such Event
of Default is continuing, the holder may, at its election, proceed by suit or
suits, at law or in equity, to enforce the payment of the Secured Indebtedness
in accordance with the terms hereof and of the notes or other instruments
evidencing it, to foreclose the lien and security interest of this Mortgage as
against all or any portion of the Mortgaged Properties, and to have said
properties sold under the judgment or decree of a court of competent
jurisdiction Pursuant to Section 39-5-19 N.M. S.A. 1978 Comp., Grantor agrees
that the redemption period shall be limited to one (1) month. To the full
extent Grantor may do so, Grantor agrees that Grantor will not at any time
insist upon, plead, claim or take the benefit or advantage of any law now or
hereafter in force providing for any appraisement, valuation, stay, extension
or redemption, and Grantor, for Grantor and Grantor's Successors, and for any
and all persons ever claiming any interest in the Mortgaged Properties, or any
part thereof, to the extent permitted by law, hereby waives and releases all
rights of redemption, valuation, appraisement, stay of execution, notice of
intention to mature or declare due the whole of the Secured Indebtedness, and
all rights to a marshalling of the assets of Grantor, including the Mortgaged
Properties, or to a sale in inverse order of alienation in the event of
foreclosure of the liens and security interests hereby created. On or at any
time after the filing of judicial proceedings to protect or enforce the rights
of the holder, the holder, as a matter of right and without regard to the
sufficiency of the security, and without any showing of insolvency, fraud or
mismanagement on the part of Grantor, shall be entitled to the appointment of a
receiver or receivers of the Mortgaged Properties, and of the income, rents,
issues, products, profits and proceeds thereof.

4.10 It is agreed that Bank or any other holder may be the
purchaser of the Mortgaged Properties, or of any part thereof, at any sale
thereof, whether such sale be under the power of sale or upon any other
foreclosure of the lien and security interest hereof or otherwise, and Bank or
other holder so purchasing shall, upon any such purchase, acquire good title to
the Mortgaged Properties so purchased, free of the lien and security interest
of these presents.

4.11 To the full extent permitted by applicable law, Grantor agrees
that it will not at any time insist upon, plead, claim or take the benefit or
advantage of any law now or hereafter in force providing for any appraisement,
valuation, stay, extension or redemption, and Grantor, for Grantor and
Grantor's Successors, and for any and all persons claiming any interest in the
Mortgaged Properties, hereby waives and releases, except as expressly provided
herein, all rights of redemption, valuation, stay of execution, notice of
intention or the

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<PAGE> 9
election to accelerate the Secured Indebtedness and all rights to a marshalling
of assets of Grantor, including the Mortgaged Properties, or to a sale in the
inverse order of alienation in the event of foreclosure of the liens and/or
security interests hereby created.

4.12 The rights and remedies hereinabove expressly conferred are
cumulative of all other rights and remedies herein, or by law or in equity
provided, and shall not be deemed to deprive the holder of any such other legal
or equitable rights or remedies, by judicial proceedings or otherwise,
appropriate to enforce the conditions, covenants and terms of this Mortgage and
of the notes or other instruments evidencing the Secured Indebtedness, and the
employment of any remedy hereunder, or otherwise, shall not prevent the
concurrent or subsequent employment of any other appropriate remedy or
remedies.

4.13 The procedures for foreclosure and all other provisions of
this Article 4 relating to remedies upon default and related matters shall be
modified to the extent necessary to comply with the laws of the state where the
Mortgaged Properties are located. It is the intent of Grantor that this
Mortgage shall be legal and enforceable in any state where the Mortgaged
Properties, or any part thereof, are located and that the provisions hereof
shall be modified only to the extent necessary to comply with the laws of such
state, and that all other provisions contained herein shall be in no way
affected or impaired by the necessity to so modify some or all of the
provisions of this Article 4.

ARTICLE 5
ASSIGNMENT OF PRODUCTION

5.1 In order further to secure the payment of the Secured
Indebtedness, Grantor does hereby TRANSFER, ASSIGN and CONVEY unto and in favor
of the holder all of the interest of Grantor in the oil, gas, casinghead gas,
condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and other
minerals (herein collectively referred to as the "Hydrocarbons"), in and under,
or which may be produced from, the Mortgaged Properties, or allocated thereto
pursuant to pooling or unitization of the Leases or otherwise, together with
all accounts, contract rights, general intangibles, products and proceeds
arising from or derived from the sale, transfer or other disposition of such
Hydrocarbons on and after the date of the execution of this Mortgage.

5.2 The foregoing assignment is made upon, and subject to, the
following terms:

(a) The holder may give written or telegraphic notice to
all of the parties producing, purchasing, taking, possessing or
receiving any such Hydrocarbons, or having in their possession any
such Hydrocarbons belonging to Grantor or such proceeds for which they
or others are accountable to the holder by virtue of the provisions of
this Section 5.2, to hold and dispose of such Hydrocarbons for the
account of the holder and to make payment of such proceeds direct to
the holder at its principal office, and the holder shall thereafter
receive, collect and retain, subject to the provisions of Section 5.5,
as part of the Mortgaged Properties, all such Hydrocarbons, all for
the benefit and further security of the Secured Indebtedness.

(b) All parties producing, purchasing, taking,
possessing, processing or receiving any such Hydrocarbons, or having
in their possession any such Hydrocarbons or such proceeds for which
they or others are accountable to the holder by virtue of the
provisions of this Section 5.2, are authorized and directed by
Grantor, upon receipt of notice by the holder given pursuant to
Subsection 5. 2(a) above, to treat and regard the holder as the
assignee and transferee of Grantor and entitled in its place and stead
to receive such Hydrocarbons and proceeds; and such parties and each
of them shall be fully protected in so treating and regarding the
holder and shall be under an obligation to see to the application by
the holder of any such proceeds received by it. Until such notice is
received by such parties, payment of all proceeds attributable to such
Hydrocarbons shall be payable directly to Grantor. Without in any way
limiting the effectiveness of the authorization and direction in the
next preceding sentence, if Grantor shall hold such proceeds which
under this Section 5.2 are receivable by the holder after such notice,
Grantor will hold the same in trust and will remit such proceeds, or
cause such proceeds to be remitted, immediately, to the holder.

(c) Without limiting the foregoing provisions of this
Article 5, Grantor stipulates that this Article 5 is intended to grant
to the holder a security interest in Grantor's interest in the
Hydrocarbons to be extracted from or attributable to the Mortgaged
Properties, and in and to the proceeds resulting from the sale thereof
at the well head.

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<PAGE> 10
5.3 Grantor covenants, agrees and specifically undertakes hereby,
to cause, after Bank shall have so requested, all pipeline companies or other
purchasers of the Hydrocarbons to pay promptly to the holder at its principal
office, Grantor's interest in the proceeds derived from the sale thereof, in
accordance with the terms of this assignment, and forthwith to execute,
acknowledge and deliver to such pipeline companies and other purchasers such
further and proper division orders, transfer orders, certificates and other
documents as may be necessary or proper to effect the intent of these presents;
and the holder shall not be required at any time, as a condition to its right
to obtain the proceeds of the Hydrocarbons, to warrant its title thereto or to
make any guaranty whatsoever. In addition, and without limitation, Grantor
covenants, agrees and specifically undertakes hereby, to provide to the holder
the name and address of every pipeline company or other purchaser of the oil,
gas and other minerals produced from or allocated to the Mortgaged Properties
when determined, together with a copy of the applicable purchase and sales
contracts. All expenses incurred by the holder in the collection of such
proceeds shall be repaid promptly by Grantor; and prior to such repayment, such
expenses shall be a part of the Secured Indebtedness.

5.4 Without limitation upon any of the foregoing, Grantor hereby
designates and appoints the holder as Grantor's true and lawful agent and
attorney-in-fact (with full power of substitution, either generally or for such
periods or purposes as the holder may from time to time prescribe), with full
power and authority, for and on behalf of and in the name of Grantor and only
upon an Event of Default, and while such Event of Default is continuing, to
execute, acknowledge and deliver all such division orders, transfer orders,
certificates and other documents of every nature, with such provisions as may
from time to time, in the opinion of the holder, be necessary or proper to
effect the intent and purpose of the assignment contained in this Article 5;
and to demand, collect, receive and sue for, in the holder's own name or in the
name of Grantor, all cash, other distributions or proceeds due or which may
become due to Grantor by virtue of the Mortgaged Properties or any part thereof
or interest therein, with the absolute right in the holder to rehypothecate,
pledge, compromise, settle or discharge the same and to do all acts and things
necessary or convenient for any such purpose, including, without limitation,
the right to give good and sufficient receipts and releases; to endorse the
name of Grantor upon any and all checks, drafts, money orders and other
instruments for the payment of monies which are payable to Grantor and
constitute collections on the Mortgaged Properties; and to perform such other
and further acts and deeds in the name of Grantor which the holder may deem
necessary and appropriate to effect the intent and purpose of the Assignment
contained in this Article 5; and Grantor shall be bound thereby as fully and
effectively as if Grantor had personally executed, acknowledged and delivered
any of the foregoing certificates or documents; as if Grantor had personally
demanded, collected, received and/or sued for any and all cash, other
distributions or proceeds; as if Grantor had personally done any and all acts
and things necessary or convenient for any such purpose; as if Grantor had
personally endorsed Grantor's own name upon any and all checks, drafts, money
orders and other instruments; and as if Grantor personally performed such other
and further acts and deeds in Grantor's own name which the holder deemed
necessary and appropriate to effect the intent and purpose of the Assignment
contained in this Article 5; PROVIDED, HOWEVER, notwithstanding anything
contained herein to the contrary, the Assignment of Production contained in
Section 5.1 hereof, and the holders rights thereunder, shall be absolute and
shall not be conditioned upon the occurrence of an Event of Default. The
powers and authorities herein conferred on the holder may be exercised by the
holder through any person who, at the time of exercise, is an officer of the
holder. The power of attorney conferred by this Section 5.4 is granted for
valuable consideration and coupled with an interest and is irrevocable so long
as the Secured Indebtedness, or any part thereof, shall remain unpaid. All
persons dealing with the holder, or any substitute, shall be fully protected in
treating the powers and authorities conferred by this Section 5.4 as continuing
in full force and effect until advised by the holder that the Secured
Indebtedness is fully and finally paid.

5.5 All proceeds received by the holder in collected funds
pursuant to this Article 5 shall be placed in a collateral collection account
at Bank, and the holder is hereby authorized to apply all such proceeds as
follows: First, to the payment of all necessary costs and expenses incident to
the receipt and collection of such proceeds; Second, to the payment of the
Secured Indebtedness in such order as the holder shall elect; and Third, the
balance, if any, remaining after the full and final payment of the Secured
Indebtedness, to Grantor or Grantor's Successors.

5.6 Should any person or entity now or hereafter purchasing or
taking any part of the Hydrocarbons fail to make payment promptly to the holder
for the purchase price of such Hydrocarbons, after notice pursuant to this
Article 5, the holder shall have the right, subject to then existing
contractual obligations, to make or to require Grantor to make, a change of
connection and the right to designate or approve the purchaser with whose
facilities a new connection shall be made, and the holder shall be without
liability or responsibility in connection therewith so long as ordinary care is
used in making such designation.

- 10 -
<PAGE> 11
5.7 The holder shall never be under any obligation to enforce the
collection of the funds assigned to it hereunder, nor shall it ever be liable
for failure to exercise diligence in the collection of such funds, but it shall
only be accountable for the sums that it shall actually receive.

ARTICLE 6
SECURITY AGREEMENT

6.1 With respect to all personal property and fixtures comprising
a part of the Mortgaged Properties, together with all proceeds and products
thereof (hereinafter collectively referred to as the "Collateral"), this
Mortgage shall likewise be a security agreement, and for a valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
and for the purpose of further securing payment and performance of the Secured
Indebtedness, Grantor hereby grants to Bank a security interest in the
Collateral including, without limitation, all rights now owned and at any time
hereafter acquired by Grantor in all (a) oil, gas and other minerals produced
from or allocated to the Mortgaged Properties, (b) accounts, chattel paper and
general intangibles arising in connection with the sale or other disposition of
such production, or otherwise associated with the Mortgaged Properties, (c)
equipment, materials, other personal property, and fixtures at any time used on
or in connection with the Mortgaged Properties or in connection with such
production, and (d) geological, geophysical, engineering, accounting, title,
legal and other technical or business data concerning the Mortgaged Properties,
and the Hydrocarbons which are in the possession of Grantor or in which Grantor
can otherwise grant a security interest, and all books, files, records,
seismic, magnetic media and other forms of recording or obtaining access to
such data, together with all accessions, additions, proceeds, products,
replacements, substitutions, and modifications to or for any of the foregoing.

6.2 Grantor hereby assigns to Bank Grantor's security interests
and liens and all other interests of Grantor arising pursuant to or perfected
by any instrument to which Grantor is a party affecting real property in which
Grantor is an interest owner, as provided in the New Mexico Products Lien Act,
Sections 48-9-1 et seq. N.M.S.A. 1978 Comp., by virtue of the first sale of
Hydrocarbons produced from the Mortgaged Properties.

6.3 Grantor represents and warrants that, except for any financing
statement now in force filed by Bank, or as shown on Exhibit "A", no financing
statement covering the Collateral, or any part thereof, has been filed with any
filing officer, and no other security interest now in force has attached or
been perfected in the Collateral, or any part thereof.

6.4 This Mortgage shall be effective as a financing statement
filed as a fixture filing with respect to all of the Collateral which is or
will become fixtures related to the Lands and Leases and is to be filed for
record as a financing statement in the real estate records of each county where
any part of the Mortgaged Properties (including such fixtures) is situated.
Such of the Mortgaged Properties which constitute minerals or the like
(including oil and gas) or accounts subject to subsection (5) of Section
55-9-103 of the New Mexico Uniform Commercial Code are or will be financed at
the wellhead or minehead of the well or mine located on the Lands described in
Exhibit "A". This Mortgage shall also be effective as a financing statement
covering such minerals or the like (including oil and gas) and such accounts,
and, where so permitted or required, is to be filed for record as such a
financing statement in the real estate records for each county where a mortgage
on the Mortgaged Properties would be filed or recorded. The above goods are or
are to become fixtures on the Lands. The record owner of the real estate
interest covered by this Mortgage is Grantor.

ARTICLE 7
MISCELLANEOUS

7.1 Upon the full and final payment of the Secured Indebtedness,
this Mortgage shall be extinguished and be of no further force and effect; and
the Mortgaged Properties shall become wholly free and clear hereof and all of
the property as assigned hereby shall be automatically reassigned to Grantor
without any further act being required; and the holder, upon the request and at
the expense of Grantor, shall promptly deliver to Grantor such instruments
evidencing the Secured Indebtedness, marked "Paid", and execute and deliver to
Grantor and others a release of this Mortgage and such other instruments of
satisfaction as may be appropriate.

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<PAGE> 12
for the Secured Indebtedness or any part thereof. Grantor, for Grantor and
Grantor's Successors, and for any and all persons ever claiming any interest in
the Mortgaged Properties, hereby waives all rights of marshalling in event of
foreclosure of the lien hereby created. No failure to exercise and no delay in
exercising on the part of the holder any - right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power or privilege preclude any other or further exercise thereof,
or the exercise of any other right, power or privilege.

7.3 For all purposes of this instrument, the post office address
of Bank shall be: P.O. Box 665415, Dallas, Texas 75265-5415, Attention: Mynan
C. Feldman, Vice President, and the post office address of Grantor shall be:
5949 Sherry Lane, Suite 1616, Dallas, Texas 75225.

7.4 No provision herein or in any promissory note, instrument, or
any other loan document executed by Grantor evidencing the Secured Indebtedness
shall require the payment or permit the collection of interest in excess of the
maximum permitted by law. If any excess of interest in such respect is
provided for herein or in any such promissory note, instrument, or any other
loan document, the provisions of this Section 7.4 shall govern, and Grantor
shall not be obligated to pay the amount of such interest to the extent that it
is in excess of the amount permitted by law. The intention of the parties
being to conform strictly to the usury laws now in force, all promissory notes,
instruments and other loan documents executed by Grantor evidencing the Secured
Indebtedness shall be held subject to reduction to the amount allowed under
said usury laws as now or hereafter construed by the courts having
jurisdiction.

7.5 Grantor hereby grants, assigns and conveys unto Bank all of
Grantor's rights to payments and liens and security interests in the Mortgaged
Properties provided for in the New Mexico Oil and Gas Proceeds Payment Act,
Sections 70-10-1 et seq. N.M.S.A. 1978 Comp.

7.6 These presents shall be binding upon the Grantor and Grantor's
Successors, and shall inure to the benefit of the holder, its successors and
assigns, and shall be covenants running with the Lands.

7.7 In the event that any one or more of the provisions contained
in this Mortgage shall be invalid, illegal or unenforceable in any respect
under any law, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby. In case any term or provision hereof is inconsistent with any term or
provision of the Loan Agreement, the term or provision contained in the Loan
Agreement shall be controlling.

7.8 THIS MORTGAGE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW MEXICO.

7.9 This Mortgage has simultaneously been executed in a number of
identical counterparts, each of which, for all purposes, shall be deemed an
original, and all of which are identical except that, to facilitate
recordation, in any particular counterpart, portions of Exhibit "A" which
describe properties and interests situated in counties other than the county in
which such particular counterpart is to be recorded may have been omitted.

7.10 The use of any particular pronoun herein shall mean and be
construed to include the plural and singular number of such pronoun, whenever
and wherever appropriate and applicable, and shall mean and be construed to
include the masculine, feminine or neuter gender of such pronoun, whenever and
wherever appropriate and applicable.

7.11 In reaching any opinion, making any determination or
requirement, or issuing any request, Bank and each holder shall act in good
faith and in a reasonable manner.

7.12 The effective date of the assignment contained in Article 5 is
the date of execution of this Mortgage at 7:00 o'clock am.

EXECUTED as of the first day of April, 1996, in multiple counterparts.

MORTGAGOR-DEBTOR:

BRIGHAM OIL & GAS, L.P.
a Delaware limited partnership

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<PAGE> 13
By: Brigham Exploration Company
Managing General Partner

By:_____________________________________
Name: Anne L. Brigham
Title: Executive Vice President
of Brigham Exploration Company

MORTGAGEE-SECURED PARTY:

BANK ONE, TEXAS, N A.,
a national banking association

By:_____________________________________
Name: Mynan C. Feldman
Title: Vice President

THE STATE OF TEXAS

COUNTY OF DALLAS

This instrument was acknowledged before me on April 1, 1996 by Anne L.
Brigham, Executive Vice President of Brigham Exploration Company, a Texas
corporation, Managing General Partner of Brigham Oil & Gas, L.P., a Delaware
limited partnership, on behalf of such limited partnership.

__________________________________
Notary Public, State of Texas
My Commission Expires:

________________________ __________________________________
(Printed or Typed Name of Notary)

- 13 -
<PAGE> 14
THE STATE OF TEXAS

COUNTY OF DALLAS

THIS INSTRUMENT was acknowledged before me on April 1, 1996, by Mynan
C. Feldman, Vice President of BANK ONE, TEXAS, N.A., a national banking
association, on behalf of said association.

__________________________________
Notary Public, State of Texas
My Commission Expires:

________________________ __________________________________
(Printed or Typed Name of Notary)

- 14 -

<PAGE> 1

EXHIBIT 10.12.3

A POWER OF SALE HAS BEEN GRANTED IN THIS MORTGAGE. A POWER OF SALE MAY ALLOW
THE MORTGAGEE TO TAKE THE MORTGAGED PROPERTY AND SELL IT WITHOUT GOING TO COURT
IN A FORECLOSURE ACTION UPON DEFAULT BY THE MORTGAGOR UNDER THIS MORTGAGE.

ATTENTION ____________ COUNTY CLERK:
Recording requested by and when recorded mail to:

BANK ONE, TEXAS, N.A.
c/o Robert N. Rule, Jr., Esq.
Locke Purnell Rain Harrell
2200 Ross Avenue, Suite 2200
Dallas, Texas 75201

MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT
OF PRODUCTION AND FINANCING STATEMENT

THE STATE OF OKLAHOMA )
) KNOW ALL MEN BY THESE PRESENTS:
COUNTIES OF CANADIAN, GRADY )
and JACKSON )

WHEREAS, Brigham Oil & Gas L.P., a Delaware limited partnership, whose
address is 5949 Sherry Lane, Suite 1616, Dallas, Texas 75225 (hereinafter
referred to as "Mortgagor"), does hereby execute and deliver this Mortgage,
Security Agreement, Assignment of Production and Financing Statement
(hereinafter referred to as the "Mortgage"), for the use and benefit of BANK
ONE, TEXAS, N.A., a national banking association (hereinafter referred to as
"Bank"), with its address at P. O. Box 655415, Dallas, Texas 75265-5415;
covering oil and gas properties and interests, and related personal properties,
therein described located on land situated in the Counties of Canadian, Grady,
and Jackson, State of Oklahoma;

NOW, THEREFORE, for and in consideration of the sum of $10.00 and
other good and valuable consideration, in hand paid by Bank to Mortgagor, the
receipt and sufficiency of which is hereby acknowledged and confessed,
Mortgagor does hereby GRANT, MORTGAGE, WARRANT, BARGAIN, SELL, TRANSFER, ASSIGN
and CONVEY unto Bank, with power of sale, all right, title and interest now or
at any time hereafter vested in Mortgagor in and to the following described
properties and interests, to wit:

(a) All oil, gas and mineral interests and other
interests and property of every kind and character located on or
attributable to the real property described on Exhibit "A"
(hereinafter collectively referred to as the "Lands"), attached hereto
and made a part hereof by reference for all purposes as if copied
herein in full;

(b) Any and all operating agreements, communitization
agreements, unitization agreements, pooling agreements, declarations
of pooled units, all units created under orders, regulations, rules or
other official acts of any federal, state or other governmental body
or regulatory agencies providing for pooling and unitization, spacing
orders or other well permits and other instruments, whether now or
hereafter made, and the units created thereby, which relate to any of
the properties and interests described or referred to in Exhibit "A",
whether or not such agreements, orders or instruments are described in
Exhibit "A";

(c) All real property described or referred to in Exhibit
"A", even though Mortgagor's rights, titles and interests be
incorrectly or insufficiently described or referred to therein, or a
description of a part or all of such rights, titles and interests be
omitted from Exhibit "A";

(d) Any and all oil, gas and mineral leases described or
referred to in Exhibit "A" (herein collectively referred to as the
"Leases"), and any and all other oil, gas and mineral leases insofar
as they cover all or any part of the Lands together with all right,
title and interest now or at any time hereafter vested in Mortgagor in
and to any and all overriding royalty interests, mineral interests,
royalty interests, net profit interests, oil payments, production
payments and all other interests and properties of every kind and
character insofar as they cover any of the Lands or the Leases,
insofar as the Leases cover the Lands, even
<PAGE> 2
though such rights, titles and interests be incorrectly or
insufficiently described or referred to therein, or a description of a
part or all of such rights, titles and interests be omitted from
Exhibit "A", together with any and all renewals, extensions,
substitutions, ratifications, supplements, amendments and replacements
of and for any of the Leases or other interests described or referred
to herein, insofar as the same cover the Lands;

(e) All personal property, fixtures, hereditaments,
improvements, easements, permits, licenses, servitudes, surface leases
and rights-of-way situated upon or used or useful or held for use in
connection with the exploration, development or operation of the
foregoing properties and interests, or the production, treating,
storing or transportation of oil, gas and other hydrocarbons
therefrom, including, without limitation, liquid extraction plants,
plant compressors, field gathering systems, valves, fittings, engines,
boilers, meters, cables, wires, towers, tubing and rods, casing,
connections, tanks and tank batteries, separators, lines, pumps,
pipes, pipelines, structures, buildings, sheds, oil wells, gas wells,
injection wells, other wells, fixtures, tools, machinery and other
equipment, power lines, telephone and telegraph lines, and other
appurtenances, apparatus, appliances and property of every kind and
character, movable or immovable, now or at any time hereafter located
on the Lands, or which may now or hereafter be used or obtained in
connection therewith, whether or not the same are described or
referred to in Exhibit "A", together with all additions,
substitutions, replacements, accessions and attachments to any and all
of the foregoing properties;

(h) Any and all proceeds, rents, issues, profits,
products, revenues and other income arising from or by virtue of the
sale, lease or other disposition of, or from any insurance payable
with respect to damage, loss or destruction of, the collateral
described in Subparagraphs (a) through (g) above.

It is expressly understood and agreed by the parties hereto that any
and all decimal fractional interests and/or well names set out in Exhibit A
pertaining to any of the properties and interests described or referred to in
Exhibit A have been appended for informational purposes only and shall not
limit in any way whatsoever the interest of Mortgagor in such properties and
interests, or interests derived thereunder, which are subject to this Mortgage,
Security Agreement, Assignment of Production and Financing Statement
(hereinafter referred to as this "Mortgage").

Mortgagor's interests in the properties and interests described in
Subparagraphs (a) through (h) above are all hereinafter sometimes collectively
referred to as the "Mortgaged Properties".

TO HAVE AND TO HOLD the Mortgaged Properties, together with all the
rights, hereditaments and appurtenances in anywise appertaining or belonging
thereto, unto Bank and its successors and assigns for the uses and purposes
hereinafter set forth forever.

- 2 -
<PAGE> 3
The term "Mortgagor's Successors", as used herein, shall mean
Mortgagor's heirs, executors, legal representatives, successors and assigns.
Mortgagor hereby binds Mortgagor and Mortgagor's Successors to warrant and
forever defend all and singular, the Mortgaged Properties, subject to the
Permitted Liens (as defined in the Loan Agreement), unto Bank and its
successors or substitutes in this trust, and its and their assigns, forever,
against every person whomsoever lawfully claiming or to claim the same or any
part thereof.

This conveyance is intended as a mortgage, however, against the
Mortgaged Properties, and the same is executed and delivered to secure and
enforce the payment by Mortgagor of all amounts provided to be paid by the
terms of the Note (as hereinafter defined), as well as all other indebtedness
from Mortgagor to Bank, hereinafter mentioned, as well as for other purposes,
as hereinafter set forth.

As used herein, the term "Loan Agreement" shall mean that certain Loan
Agreement of even date herewith between Mortgagor and Bank.

ARTICLE 1
REPRESENTATIONS AND WARRANTIES

1.1 Mortgagor hereby expressly represents and warrants to Bank
that (a) the Leases are in full force and effect; (b) Mortgagor's interests in
the Leases are valid and subsisting on the Lands and entitle Mortgagor to
receive that proportion (indicated as "NRI") of the total production from the
Mortgaged Properties indicated in connection with the descriptions thereof in
Exhibit "A", subject to matters disclosed in Exhibit A and to Permitted Liens,
which altogether do not cause the working interests of Grantor to be greater
than or the net revenue interests of Grantor to be less than indicated on
Exhibit A; (c) Mortgagor has good, valid and indefeasible title to Mortgagor's
interest in the Leases and to Mortgagor's interest in the personal property and
fixtures comprising a part of the Mortgaged Properties or used or obtained in
connection therewith except for Permitted Liens (as that term is defined in the
Loan Agreement) and except as provided in Exhibit "A", and the right, power and
authority to execute and deliver this Mortgage and convey the Mortgaged
Properties; (d) the Mortgaged Properties are free and clear of all claims,
liens, encumbrances, security interests, contracts, agreements, options or
other restrictions or limitations of any nature or kind, except for Permitted
Liens (as defined in the Loan Agreement) and except as expressly provided
herein; (e) all rentals, royalties and other amounts due and payable under the
Leases have been duly paid or provision made for the payment of same, and
obligations to be performed under the Leases as to the Lands have been duly
performed; (f) the holder shall quietly enjoy and possess the Mortgaged
Properties; (g) Mortgagor is not a party to, and none of the hydrocarbons
produced from any of the wells located on the Leases are the subject of, any
Advance Payment Contract affecting or relating to any of the Mortgaged
Properties. As used herein, the term "Advance Payment Contract" means any
contract whereby Mortgagor either (1) receives or becomes entitled to receive
(either directly or indirectly to a third party for Mortgagor's account or
benefit) any payment (an "Advance Payment") to be applied toward payment of the
purchase price of hydrocarbons produced or to be produced from any of the
Mortgaged Properties and which Advance Payment is paid in advance of actual
delivery of such production to or for the account of the purchaser regardless
of such production, or (2) grants an option or right of refusal to the
purchaser to take delivery of such production in lieu of payment, and, in
either of the foregoing instances, the Advance Payment is, or is to be, applied
as payment in full for such production when sold and delivered or is, or is to
be, applied as payment for a portion only of the purchase price thereof or of a
percentage or share of such production; provided that (A) inclusion of the
standard "take or pay" provision in any gas sales or purchase contract shall
not, in and of itself, constitute such contract as an Advance Payment Contract
for the purposes hereof, and (B) neither a hedging, swap or other similar
arrangement, nor a gas balancing agreement shall constitute an Advance Payment
Contract; (h) Mortgagor and any guarantor of the Secured Indebtedness
(hereinafter defined) are now in a solvent condition; (i) no bankruptcy or
insolvency proceedings are pending contemplated or threatened by or against
Mortgagor and any guarantor of the Secured Indebtedness; and (j) no other
judicial or administrative actions, suits or proceedings are pending,
contemplated or threatened by or against Mortgagor and any guarantor of the
Secured Indebtedness.

ARTICLE 2
SECURED INDEBTEDNESS

2.1 This Mortgage is given to secure payment and performance of
the following indebtedness, obligations and liabilities, to wit:

- 3 -
<PAGE> 4
(a) That certain Revolving Note dated of even date in the
original principal amount of Twenty-Five Million Dollars
($25,000,000), executed by Mortgagor, as maker, payable to the order
of Bank, bearing interest as provided therein and containing usual and
customary provisions for collection and attorneys' fees (hereinafter
referred to as the "Note"); and any and all renewals, increases,
refundings, substitutions, replacements, consolidations and/or
extensions of or for the Note, or any part thereof;

(b) All indebtedness, obligations and liabilities of
Mortgagor arising pursuant to the provisions of any loan agreement,
whether now existing or hereafter arising, executed or to be executed
by and between Mortgagor and Bank, including, without limitation, the
Loan Agreement, and all supplements, amendments, restatements,
modifications and replacements thereof or therefor, together with any
and all renewals, increases, refundings, substitutions, replacements,
consolidations and/or extensions of or for any such indebtedness,
obligations and liabilities, or any part thereof;

(c) All indebtedness, obligations and liabilities arising
pursuant to the provisions of this Mortgage, and any and all other
deeds of trust, mortgages, indentures, security agreements, pledge
agreements, collateral mortgages, collateral chattel mortgages,
assignments, or other conveyances, whether now existing or hereafter
arising, and all supplements, amendments, restatements, modifications
and replacements thereof or therefor, executed or to be executed by
Mortgagor or any guarantor of the Secured Indebtedness to secure the
Secured Indebtedness or for the use and benefit of Bank, together with
any and all renewals, increases, refundings, substitutions,
replacements, consolidations and/or extensions of or for any such
indebtedness, obligations and liabilities, or any part thereof
(hereinafter collectively referred to as the "Security Instruments");

(d) All loans and advances which Bank may hereafter make
to Mortgagor, and any and all renewals, increases, refundings,
substitutions, replacements, consolidations and/or extensions of any
and all such loans and advances, or any part thereof; and

(e) All other and additional debts, obligations and
liabilities of every kind and character of Mortgagor, now existing or
hereafter arising in favor of Bank, regardless of whether such debts,
obligations and liabilities are direct or indirect, primary or
secondary, joint, several or joint and several, fixed or contingent,
and regardless of whether such present or future debts, obligations
and liabilities may, prior to their acquisition by Bank, be or have
been payable to, or be or have been in favor of, some other persons or
have been acquired by Bank in a transaction with one other than
Mortgagor, together with any and all renewals, increases, refundings,
substitutions, replacements, consolidations and/or extensions of or
for any and all such debts, obligations, and liabilities, or any part
thereof (it being contemplated that Bank may lend additional sums of
money to Mortgagor from time to time, but shall not be obligated to do
so, and that all such additional sums and loans shall be part of the
"Secured Indebtedness" as hereinafter defined).

ARTICLE 3
COVENANTS

3.1 The covenants, agreements and undertakings of Mortgagor
contained in this Mortgage, whether in this Article 3 or elsewhere, are made by
Mortgagor for Mortgagor and Mortgagor's Successors.

3.2 Mortgagor hereby covenants, agrees and specifically undertakes
hereby:

(a) In all material respects, to maintain, preserve and
keep or cause to be maintained, preserved and kept Mortgagor's
interests in the Mortgaged Properties and all appurtenances thereto,
including, without limitation, all buildings, improvements, machinery,

- 4 -
<PAGE> 5
equipment, pipelines, fixtures and other personal property of every
kind and character, in respect of the Leases, in thorough repair,
working order and condition, and from time to time, at Mortgagor's own
expense, do or cause to be done all necessary and proper repairs,
renewals, replacements and substitutions of the Mortgaged Properties
and all appurtenances thereto, so that at all times the state and
condition of the Mortgaged Properties and all appurtenances thereto
will be fully preserved and maintained;

(b) To the extent Mortgagor has the right to do so,
permit or cause to be permitted the holder, its agents, employees and
representatives, at their own risk, to go upon, examine, inspect and
remain on the Mortgaged Properties, and to go upon the derrick floor
of any well or wells at any time drilled or being drilled thereon, and
to strap, gauge, measure and inspect any and all tanks at any time on
the Mortgaged Properties or holding oil, gasoline or casinghead
gasoline therefrom; and Mortgagor shall do or cause to be done all
things necessary and/or proper to enable the holder to exercise said
rights whenever it so desires information so obtained shall be subject
to the Bank's obligations to maintain confidentiality as provided in
Section 12(i) of the Loan Agreement;

(c) To promptly notify the holder in writing if the
validity or priority of this Mortgage or any of the rights, titles,
liens or security interests created or evidenced hereby with respect
to the Mortgaged Properties, or any part thereof, shall be questioned,
attacked or endangered, directly or indirectly, and do or cause to be
done all things necessary and/or proper to protect, warrant and defend
title to the Mortgaged Properties unto the holder and its successors
and assigns at Mortgagor's sole expense against all persons whomsoever
claiming an interest therein or a lien or security interest thereon,
but the holder shall have the right, at any time, to intervene in any
suit affecting such title and to employ independent counsel in
connection with any such suit to which it may be a party by
intervention or otherwise; and upon demand Mortgagor agrees to pay the
holder all reasonable expenses paid or incurred by it in respect of
any such suit affecting title to any such property or affecting the
holder's rights, titles, liens or security interests hereunder,
including, without limitation, reasonable fees to the holder's
attorneys, and Mortgagor will indemnify and hold the holder harmless
from and against any and all costs and expenses, including, without
limitation, any and all costs, loss, damage or liability which the
holder may suffer or incur by reason of the failure of the title to
all or any part of the Mortgaged Properties, or by reason of the
failure or inability of Mortgagor, for any reason, to convey the
rights, titles, liens and security interests which this Mortgage
purports to mortgage, create or assign, and all amounts at any time so
payable by Mortgagor shall be secured by the lien and security
interest hereof and by the assignment of production herein contained;

(d) At any time and from time to time, upon request by
the holder and at Mortgagor's sole expense, forthwith to execute and
deliver or cause to be executed and delivered to the holder and to
record, file or register, any and all additional instruments and
further assurances as may be necessary or proper, in the holders
opinion, to effect the intent of these presents;

(e) To promptly furnish the holder with the financial
information, statements, and reports reasonably requested by and
required to be furnished to Bank;

(f) To pay all Secured Indebtedness in accordance with
the terms thereof or hereof, or when the maturity thereof be
accelerated in accordance with the terms thereof or hereof;

- 5 -
<PAGE> 6
perpetuate or renew any oil and gas lease or other lease by payment
of rental or delay rental or by commencement or continuation of
operations, or (2) prevent the Mortgagor from abandoning or releasing
any oil and gas lease, other lease or well thereon, when in such
events, in the opinion of Mortgagor, exercised in good faith, it is
not in the best interest of Mortgagor to perpetuate the same;

(h) To do or cause to be done such development work as
may be reasonably necessary to the prudent and economical operation of
the Mortgaged Properties in accordance with the generally accepted
practices of prudent operators in the industry, including all actions
that may be appropriate to protect from diminution the productive
capacity of the each producing well on the Mortgaged Properties
(including, without limitation, cleaning out and reconditioning wells)
and to protect the Mortgaged Properties against drainage whenever, and
as often as, is necessary;

(j) To comply in all respects with the affirmative and
negative covenants contained in the Loan Agreement, as the same may be
supplemented, amended, modified and replaced from time to time.

3.3 Any and all covenants contained in this Mortgage may from time
to time, by instrument in writing signed by the holder and delivered to
Mortgagor, be waived to such extent and in such manner as the holder may
consider appropriate; but no such waiver shall at any time affect or impair the
holder's rights or liens hereunder, except to the extent so specifically stated
in such written instrument.

3.4 As to any part of the Mortgaged Properties which may be
comprised of interests in the Leases which are other than working interests or
which may be operated by a party or parties other than Mortgagor, Mortgagor's
covenants as expressed in this Article 3 are modified to require that Mortgagor
use reasonable efforts to obtain compliance with such covenants by the working
interest owners or the operator or operators of such Leases or properties,
including, without limitation, the exercise by Mortgagor of all rights under
any operating agreements to which Mortgagor is a party.

ARTICLE 4
DEFAULTS AND REMEDIES

4.1 The term "Event of Default", as used herein, shall mean the
occurrence of any one or more of the following events:

(a) Any Event of Default specified in the Loan Agreement,
any of the Security Instruments or any other agreement or contract
existing at the date hereof or hereinafter entered into between
Mortgagor and Bank, or any supplement, amendment, modification or
replacement for any such agreement, shall have occurred; or

(b) The title of Mortgagor or Bank to the Mortgaged
Properties, or a substantial part thereof, becomes in any manner
affected or impaired or becomes the subject matter of litigation
which, in the good faith opinion of Bank, would likely result in
substantial impairment or loss of the lien and security interest
intended to be created by this Mortgage.

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of any of its legal and equitable rights and remedies, either by the
institution of a suit or suits, in equity or at law, or in bankruptcy, in any
court or courts of competent jurisdiction, whether for the specific performance
of any covenant, undertaking or agreement contained herein or in the aid of any
execution of any powers granted herein, or for any foreclosure hereof or
hereunder, or for any sale of the mortgaged Properties, or any part thereof, so
far as may be authorized by law, or for the enforcement of such other or
additional appropriate legal or equitable remedies as the Bank may deem most
effectual to protect and enforce the aforesaid rights.

4.2 If Mortgagor should fail, refuse or be unable to pay any sum
of money herein covenanted to be paid by Mortgagor, or fail, refuse or be
unable to observe, keep or perform any additional covenant, agreement or
undertaking whatsoever contained in this Mortgage, the holder may, but shall
not be obligated to, pay said sums of money, or perform or attempt to perform
any such covenant, agreement or undertaking and any such payment so made or
expense reasonably incurred in the performance or attempted performance of any
such covenant, agreement or undertaking shall be, and is hereby declared by
Mortgagor to be, a part of the Secured Indebtedness, and Mortgagor promises,
upon demand, to pay to the holder at the office of Bank set forth hereinabove
all sums so advanced or paid by the holder, with interest at the Default Rate
(as defined in the Loan Agreement) from the date paid or incurred by the
holder. No such payment by the holder shall in any way be considered or
constitute a waiver of any such default or of the holder's right to declare the
Secured Indebtedness at once due and payable. In addition to the lien and
security interest hereof, the holder shall be subrogated to all rights and
liens securing the payment of any debt, claim, tax or assessment for the
payment of which it shall have made such advance.

4.3 Nothing contained in this Article 4 shall be construed to
limit or amend in any way the Events of Default enumerated in or any other
document executed in connection with the transaction contemplated herein or
hereby. Bank may thereupon avail itself of any of its legal and equitable
rights and remedies, either by the institution of a suit or suits, in equity or
at law, or in bankruptcy, in any court or courts of competent jurisdiction,
whether for the specific performance of any covenant, undertaking or agreement
contained herein or in the aid of any execution of any powers granted herein,
or for any foreclosure hereof or hereunder, or for any sale of the Mortgaged
Properties, or any part thereof, so far as may be authorized by law, or for the
enforcement of such other or additional appropriate legal or equitable remedies
as Bank may deem most effectual to protect and enforce the aforesaid rights.

4.4 Upon the occurrence of an Event of Default, and if such Event
of Default is continuing, the Bank may, and Mortgagor hereby confers on the
Bank the power to, sell the Mortgaged Property and the interests therein in the
manner provided for in the Oklahoma Power of Sale Mortgage Foreclosure Act,
OKLA. STAT., tit. 46, Sections 40 et seq., as the same may be amended from time
to time (the "Act"), or other applicable Law. Such power of sale shall be
exercised by giving Mortgagor a notice of intent to foreclose by power of sale
and setting forth, among other things, the nature of the breach(es) or
default(s) and the action required to effect a cure thereof and the time period
within which such cure may be effected all in compliance with and as may be
required by the Act or other applicable law. If no cure is effected within the
statutory time limits, the holder may accelerate the Secured Indebtedness
without further notice (the aforementioned statutory cure period shall run
concurrently with any contractual provision for notice and cure period before
acceleration of the Secured Indebtedness) and may then proceed in the manner
and subject to and as required by the conditions of the Act or other applicable
law to serve upon Mortgagor and other necessary parties and publish a notice of
sale and to then sell and convey the Mortgaged Property all in accordance with
the Act or other applicable law. The sale shall be made as an entirety or in
lots, parcels, or divisions, upon such notice,at such time and place, in such
manner and under such conditions all as provided for in the Act or other
applicable law. The proceeds of the sale shall be applied in the manner
provided for in the Act or other applicable law and in accordance with Section
4.7 hereof. No action of Bank based upon the provisions contained herein or
contained in the Act, including, without limitation, the giving of the notice
of intent to foreclose by power of sale or service of the notice of sale, shall
constitute an election of remedies which would preclude Bank from pursuing
judicial foreclosure before or at any time after commencement of the power of
sale foreclosure procedure.

4.5 In addition to all rights, privileges and options specified
above, it is mutually agreed that upon the occurrence of an Event of Default,
and if such Event of Default is continuing, if permitted by the laws of the
state in which the Mortgaged Properties are located, Bank, acting and by and
through any one or more designated agents or representatives, shall have the
right (but not the obligation) and is hereby authorized and empowered to sell
the Mortgaged Properties, or any part or parts thereof, either as a whole or in
parts, at public or private sale, in whatever manner and upon whatever terms
Bank may specify, and to convey same to the purchaser or purchasers; provided,
however, that Bank may exercise the authority thus granted only after first

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having complied fully with all applicable laws of the state in which the
Mortgaged Properties are located, including, without limitation, such laws as
pertain to the foreclosure of mortgages or deeds of trust, the giving of notice
of the time, place and terms of sale or sales, and the exercise of any of the
rights, privileges and options thereby granted. Any holder of any indebtedness
secured hereby shall have the right to become the purchaser at any such sale.
The sale of any part of the Mortgaged Properties shall not exhaust the power of
sale, but sales may be made from time to time until all property is sold or the
Secured Indebtedness is paid in full. It shall not be necessary to have
present or to exhibit at any such sale any of the personal property subject to
the lien hereof. To the extent permitted by applicable law, any sale hereunder
may be adjourned by announcement at the time and place appointed for such sale,
without further notice except as may be required by applicable law.

4.6 Upon the occurrence of an Event of Default, and if such Event
of Default is continuing, the holder may, at its option, and is hereby
authorized, prior or subsequent to the exercise of any remedies provided for in
this Mortgage, to enter upon the Mortgaged Properties, or any part thereof, and
to take possession of the Mortgaged Properties in the possession of Mortgagor
or Mortgagor's Successors, and may exclude Mortgagor or Mortgagor's Successors,
and all persons claiming under Mortgagor, wholly or partly therefrom; and,
holding the same, the holder may exercise without interference from Mortgagor
or Mortgagor's Successors, any and all rights which Mortgagor has with respect
to the management, possession, operation, protection or preservation of the
Mortgaged Properties, and the holder may use, administer, manage, operate and
control the Mortgaged Properties and conduct the business thereof to the same
extent as Mortgagor or Mortgagor's Successors might at the time do and may
exercise all rights and powers of Mortgagor, in the name, place and stead of
Mortgagor, or otherwise as the holder shall deem best. All costs, expenses and
liabilities of every character incurred by the holder shall be a demand
obligation owed by Mortgagor to holder and shall bear interest at the rate
specified in Section 4.2 hereof and shall constitute a portion of the Secured
Indebtedness and shall be secured by this Mortgage and all of the Security
Instruments. If necessary to obtain the possession provided for hereinabove,
the holder, as the case may be, may invoke any one or more actions for forcible
entry and detainer, trespass to try title and restitution. In connection with
any action taken by the holder pursuant to this Section 4.6, the holder shall
not be liable for any loss sustained by Mortgagor resulting from any act or
omission of the holder in managing the Mortgaged Properties, unless such loss
is caused by the willful misconduct or bad faith of the holder. Mortgagor
hereby agrees to indemnify and hold harmless the holder from and against any
and all liability, loss or damage which may be incurred by reason of the
exercise of rights or remedies hereunder. Should the holder incur any such
liability by reason of this Mortgage or the exercise of rights or remedies
hereunder or in defense of any such claims or demands, the amount thereof,
including without limitation, costs, expenses and reasonable attorneys' fees,
shall be a demand obligation owing by Mortgagor to the holder and shall bear
interest each day from the date incurred until paid at the rate specified in
Section 4.2 hereof and shall be a part of the Secured Indebtedness and shall be
secured by this Mortgage and all of the Security Instruments. Mortgagor hereby
consents to, ratifies and confirms any and all actions of the holder with
respect to the Mortgaged Properties taken under this Section 4.6.

4.7 Bank is authorized to receive the proceeds of said sale or
sales made pursuant to Section 4.4 and Section 4.5 hereof and apply the same as
follows: First, to the payment of all necessary costs and expenses incident to
the execution of said trust, including but not limited to all court costs and
charges of every character in the event foreclosure is by suit; Second, to the
payment of the Secured Indebtedness in such order as the holder shall elect;
and Third, the balance, if any, remaining after the full and final payment of
the Secured Indebtedness, to Mortgagor or Mortgagor's Successors.

4.8 It is agreed that in any deed or deeds given pursuant to the
exercise of a power of sale, any and all statements of fact or other recitals
therein made as to the identity of the holder or as to the occurrence or
existence of any default, or as to the acceleration of the maturity of the
Secured Indebtedness, or as to the request to sell, notice of sale, time,
place, terms and manner of sale, and receipt, distribution and application of
the money realized therefrom, and, without being limited by the foregoing, as
to any act or thing having been duly done by the holder, or any of them if
there be more than one, shall be taken by all courts of law and equity as prima
facie evidence that the said statements of recitals state facts and are without
further question to be so accepted, and Mortgagor does hereby ratify and
confirm any and all acts that Bank may lawfully do in the premises by virtue
hereof.

4.9 In case the lien and security interest thereof shall be
foreclosed by power of sale or by judicial action, the purchaser at any such
sale shall receive, as an incident to its ownership, immediate possession of
the property purchased, and Mortgagor agrees for Mortgagor and for all persons
claiming under Mortgagor, that

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<PAGE> 9
if Mortgagor or any such person shall hold possession of said property, or any
part thereof, subsequent to foreclosure, Mortgagor or the parties so holding
possession shall be considered as tenants at sufferance of the purchaser at
foreclosure sale, and anyone occupying the property after demand for possession
thereof shall be guilty of forcible detainer and shall be subject to eviction
and removal, forcible or otherwise, with or without process of law, and all
damages by reason thereof are hereby expressly waved.

4.10 Upon the occurrence of an Event of Default, and if such Event
of Default is continuing, the holder may, at its election, proceed by suit or
suits, at law or in equity, to enforce the payment of the Secured Indebtedness
in accordance with the terms hereof and of the notes or other instruments
evidencing it, to foreclose the lien and security interest of this Mortgage as
against all or any portion of the Mortgaged Properties, and to have said
properties sold under the judgment or decree of a court of competent
jurisdiction. On or at any time after the filing of judicial proceedings to
protect or enforce the rights of the holder, the holder, as a matter of right
and without regard to the sufficiency of the security, and without any showing
of insolvency, fraud or mismanagement on the part of Mortgagor, shall be
entitled to the appointment of a receiver or receivers of the Mortgaged
Properties, and of the income, rents, issues, products, profits and proceeds
thereof.

4.11 It is agreed that Bank or any other holder may be the
purchaser of the Mortgaged Properties, or of any part thereof, at any sale
thereof, whether such sale be under the power of sale, or upon any other
foreclosure of the lien and security interest hereof or otherwise, and Bank or
other holder so purchasing shall, upon any such purchase, acquire good title to
the Mortgaged Properties so purchased, free of the lien and security interest
of these presents

4.12 Appraisement of the Mortgaged Properties is hereby waived or
not waived, at the option of the Bank, such option to be exercised at or prior
to the time judgment is rendered in any judicial foreclosure hereof. To the
full extent permitted by applicable law, Mortgagor agrees that it will not at
any time insist upon, plead, claim or take the benefit or advantage of any law
now or hereafter in force providing for any valuation, stay, extension or
redemption, and Mortgagor, for Mortgagor and Mortgagor's Successors, and for
any and all persons claiming any interest in the Mortgaged Properties, hereby
waives and releases, except as expressly provided herein, all rights of
redemption, valuation, stay of execution, notice of intention or the election
to accelerate the Secured Indebtedness and all rights to a marshalling of
assets of Mortgagor, including the Mortgaged Properties, or to a sale on
inverse order of alienation in the event of foreclosure of the liens and/or
security interests hereby created.

4.13 The rights and remedies hereinabove expressly conferred are
cumulative of all other rights and remedies herein, or by law or in equity
provided, and shall not be deemed to deprive the holder of any such other legal
or equitable rights or remedies, by judicial proceedings or otherwise,
appropriate to enforce the conditions, covenants and terms of this Mortgage and
of the notes or other instruments evidencing the Secured Indebtedness, and the
employment of any remedy hereunder, or otherwise, shall not prevent the
concurrent or subsequent employment of any other appropriate remedy or
remedies.

4.14 In the event the Mortgaged Properties, or any part thereof,
shall be located in any state other than the State of Oklahoma, the procedures
for foreclosure and all other provisions of this Article 4 relating to remedies
upon default and related matters shall be modified to the extent necessary to
comply with the laws of the state where such properties are located. It is the
intent of Mortgagor that this Mortgage shall be legal and enforceable in any
state where the Mortgaged Properties, or any part thereof, are located and that
the provisions hereof shall be modified only to the extent necessary to comply
with the laws of such state, and that all other provisions contained herein
shall be in no way affected or impaired by the necessity to so modify some or
all of the provisions of this Article 4.

ARTICLE 5
ASSIGNMENT OF PRODUCTION

5.1 In order further to secure the payment of the Secured
Indebtedness, Mortgagor does hereby TRANSFER, ASSIGN, and CONVEY unto and in
favor of the Bank all of the interest of Mortgagor in the oil, gas, casinghead
gas, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and
other minerals (herein collectively referred to as the Hydrocarbons"), in and
under, or which may be produced from, the Mortgaged Properties, or allocated
thereto pursuant to pooling or unitization of the Leases or otherwise, together
with all

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<PAGE> 10
accounts, contract rights, general intangibles, products and proceeds arising
from or derived from the sale, transfer or other disposition of such
Hydrocarbons on and after the date of the execution of this Mortgage.

5.2 The foregoing assignment is made upon, and subject to, the
following terms:

(a) The holder may give written or telegraphic notice to
all of the parties producing, purchasing, taking, possessing or
receiving any such Hydrocarbons, or having in their possession any
such Hydrocarbons belonging to Mortgagor or such proceeds for which
they or others are accountable to the holder by virtue of the
provisions of this Section 5.2, to hold and dispose of such
Hydrocarbons for the account of the holder and to make payment of such
proceeds direct to the holder at its principal office, and the holder
shall thereafter receive, collect and retain, subject to the
provisions of Section 5.5, as part of the Mortgaged Properties, all
such Hydrocarbons, all for the benefit and further security of the
Secured Indebtedness.

(b) All parties producing, purchasing, taking,
possessing, processing or receiving any such Hydrocarbons, or having
in their possession any such Hydrocarbons or such proceeds for which
they or others are accountable to the holder by virtue of the
provisions of this Section 5.2, are authorized and directed by
Mortgagor, upon receipt of notice by the holder given pursuant to
Subsection 5.2(a) above, to treat and regard the holder as the
assignee and transferee of Mortgagor and entitled in its place and
stead to receive such Hydrocarbons and proceeds; and such parties and
each of them shall be fully protected in so treating and regarding the
holder and shall be under no obligation to see to the application by
the holder of any such proceeds received by it. Until such notice is
received by such parties, payment of all proceeds attributable to such
Hydrocarbons shall be payable directly to Mortgagor as provided in
Section 5.3 below. Without in any way limiting the effectiveness of
the authorization and direction in the next preceding sentence, if
Mortgagor shall receive such proceeds which under this Section 5.2 are
receivable by the holder after such notice, Mortgagor will hold the
same in trust and will remit such proceeds, or cause such proceeds to
be remitted, immediately, to the holder.

(c) Without limiting the foregoing provisions of this
Article 5, Mortgagor stipulates that this Article 5 is intended to
grant to the holder a security interest in Mortgagor's interest in the
Hydrocarbons to be extracted from or attributable to the Mortgaged
Properties, and in and to the proceeds resulting from the sale thereof
at the well head.

5.3 Mortgagor covenants, agrees and specifically undertakes
hereby, to cause, after Bank shall have so requested, all pipeline companies or
other purchasers of the Hydrocarbons to pay promptly to the holder, for the
benefit of Mortgagor, at the address designated by the holder, Mortgagor's
interest in the proceeds derived from the sale thereof, in accordance with the
terms of this assignment, and forthwith to execute, acknowledge and deliver to
such pipeline companies and other purchasers such further and proper division
orders, transfer orders, certificates and other documents as may be necessary
or proper to effect the intent of these presents; and the holder shall not be
required at any time, as a condition to its right to obtain the proceeds of the
Hydrocarbons, to warrant its title thereto or to make any guaranty whatsoever.
In addition, and without limitation, Mortgagor covenants, agrees and
specifically undertakes hereby, to provide to the holder the name and address
of every pipeline company or other purchaser of the oil, gas and other minerals
produced from or allocated to the Mortgaged Properties when determined,
together with a copy of the applicable purchase and sales contracts. All
expenses incurred by the holder in the collection of such proceeds shall be
repaid promptly by Mortgagor; and prior to such repayment, such expenses shall
be a part of the Secured Indebtedness.

5.4 Without limitation upon any of the foregoing, Mortgagor hereby
designates and appoints the holder as Mortgagor's true and lawful agent and
attorney-in-fact (with full power of substitution, either generally or for such
periods or purposes as the holder may from time to time prescribe), with full
power and authority, for and on behalf of and in the name of Mortgagor and only
upon an Event of Default, and while such Event of Default is continuing, to
execute, acknowledge and deliver all such division orders, transfer orders,
certificates and other documents of every nature, with such provisions as may
from time to time, in the opinion of the holder, be necessary or proper to
effect the intent and purpose of the assignment contained in this Article 5;
and to demand, collect, receive and sue for, in the holder's own name or in the
name of Mortgagor, all cash, other distributions or proceeds due or which may
become due to Mortgagor by virtue of the Mortgaged Properties or any part
thereof or interest therein, with the absolute right in the holder to
rehypothecate, pledge,

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compromise, settle or discharge the same and to do all acts and things
necessary or convenient for any such purpose, including, without limitation,
the right to give good and sufficient receipts and releases; to endorse the
name of Mortgagor upon any and all checks, drafts, money orders and other
instruments for the payment of monies which are payable to Mortgagor and
constitute collections on the Mortgaged Properties; and to perform such other
and further acts and deeds in the name of Mortgagor which the holder may deem
necessary and appropriate to effect the intent and purpose of the Assignment
contained in this Article 5; and Mortgagor shall be bound thereby as fully and
effectively as if Mortgagor had personally executed, acknowledged and delivered
any of the foregoing certificates or documents; as if Mortgagor had personally
demanded, collected, received and/or sued for any and all cash, other
distributions or proceeds; as if Mortgagor had personally done any and all acts
and things necessary or convenient for any such purpose; as if Mortgagor had
personally endorsed Mortgagor's own name upon any and all checks, drafts, money
orders and other instruments; and as if Mortgagor personally performed such
other and further acts and deeds in Mortgagor's own name which the holder
deemed necessary and appropriate to effect the intent and purpose of the
Assignment contained in this Article 5; PROVIDED, HOWEVER, notwithstanding
anything contained herein to the contrary, the Assignment of Production
contained in Section 5.1 hereof, and the holders rights thereunder, shall be
absolute and shall not be conditioned upon the occurrence of an Event of
Default. The powers and authorities herein conferred on the holder may be
exercised by the holder through any person who, at the time of exercise, is an
officer of the holder. The power of attorney conferred by this Section 5.4 is
granted for valuable consideration and coupled with an interest and is
irrevocable so long as the Secured Indebtedness, or any part thereof, shall
remain unpaid. All persons dealing with the holder, or any substitute, shall
be fully protected in treating the powers and authorities conferred by this
Section 5.4 as continuing in full force and effect until advised by the holder
that the Secured Indebtedness is fully and finally paid.

5.5 All proceeds received by the holder in collected funds
pursuant to this Article 5 shall be placed in a collateral collection account
at Bank, and the holder is hereby authorized to apply all such proceeds as
follows: First, to the payment of all necessary costs and expenses incident to
the receipt and collection of such proceeds; Second, to the payment of the
Secured Indebtedness then due in such order as the holder shall elect; and
Third, the balance, if any, remaining after the full and final payment of the
Secured Indebtedness, to Mortgagor or Mortgagors Successors.

5.6 Should any person or entity now or hereafter purchasing or
taking any part of the Hydrocarbons fail to make payment promptly to the holder
for the purchase price of such Hydrocarbons, after notice pursuant to this
Article 5, the holder shall have the right to make or to require Mortgagor to
make, a change of connection and the right, subject to then existing
contractual obligations to designate or approve the purchaser with whose
facilities a new connection shall be made, and the holder shall be without
liability or responsibility in connection therewith so long as ordinary care is
used in making such designation

5.7 The holder shall never be under any obligation to enforce the
collection of the funds assigned to it hereunder, nor shall it ever be liable
for failure to exercise diligence in the collection of such funds, but it shall
only be accountable for the sums that it shall actually receive.

ARTICLE 6
SECURITY AGREEMENT

6.1 With respect to all personal property and fixtures comprising
a part of the Mortgaged Properties, together with all proceeds and products
thereof (hereinafter collectively referred to as the "Collateral"), this
Mortgage shall likewise be a security agreement, and for a valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
and for the purpose of further securing payment and performance of the Secured
Indebtedness, Mortgagor hereby grants to Bank a security interest in the
Collateral including, without limitation, all rights now owned and at any time
hereafter acquired by Mortgagor in all (a) oil, gas and other minerals produced
from or allocated to the Mortgaged Properties, (b) accounts, chattel paper and
general intangibles arising in connection with the sale or other disposition of
such production, or otherwise associated with the Mortgaged Properties, (c)
equipment, materials, other personal property, and fixtures at any time used on
or in connection with the Mortgaged Properties or in connection with such
production, and (d) geological, geophysical, engineering, accounting, title,
legal and other technical or business data concerning the Mortgaged Properties,
and the Hydrocarbons which are in the possession of Mortgagor or in which
Mortgagor can otherwise grant a security interest, and all books, files,
records, seismic, magnetic media and other forms of recording or

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<PAGE> 12
obtaining access to such data, together with all accessions, additions,
proceeds, products, replacements, substitutions, and modifications to or for
any of the foregoing.

6.2 Mortgagor hereby assigns to Bank Mortgagor's security
interests and liens and all other interests of Mortgagor arising pursuant to or
perfected by any instrument to which Mortgagor is a party affecting real
property in which Mortgagor is an interest owner, as and if provided in the
Oklahoma Uniform Commercial Code or otherwise, by virtue of the first sale of
Hydrocarbons produced from the Mortgaged Properties.

6.3 Mortgagor represents and warrants that, except for any
financing statement now in force filed by Bank, or as shown on Exhibit "A", no
financing statement covering the Collateral, or any part thereof, has been
filed with any filing officer, and no other security interest now in force has
attached or been perfected in the Collateral, or any part thereof.

6.4 This Mortgage shall be effective as a financing statement
filed as a fixture filing with respect to all of the Collateral which s or will
become fixtures related to the Lands and Leases and is to be filed for record
as a financing statement in the real estate records of each county where any
part of the Mortgaged Properties (including such fixtures) is situated. Such
of the Mortgaged Properties which constitute minerals or the like (including
oil and gas) or accounts subject to subsection (5) of Section 9-103 of the
Oklahoma Uniform Commerce Code are or will be financed at the wellhead or
minehead of the well or mine located on the Lands described in Exhibit "A".
This Mortgage shall also be effective as a financing statement covering such
minerals or the like (including oil and gas) and such accounts, and, where so
permitted or required, is to be filed for record as such a financing statement
in the real estate records for each county where a mortgage on the Mortgaged
Properties would be filed or recorded. The above goods are or are to become
fixtures on the Lands. The record owner of the real estate interest covered by
this Mortgage is Mortgagor.

ARTICLE 7
MISCELLANEOUS

7.1 Upon the full and final payment of the Secured Indebtedness,
this Mortgage shall be extinguished and be of no further force and effect; and
the Mortgaged Properties shall become wholly free and clear hereof and all of
the property as assigned hereby shall be automatically reassigned to Mortgagor
without any further act being required; and the holder, upon the request and at
the expense of Mortgagor, shall promptly deliver to Mortgagor such instruments
evidencing the Secured Indebtedness, marked "PAID", and execute and deliver to
Mortgagor and others a release of this Mortgage and such other instruments of
satisfaction as may be appropriate.

7.2 The rights, titles, interests, liens and powers hereunder are
cumulative of each other and of all other rights, titles, interests, liens and
powers which may now or hereafter exist to secure the payment of the Secured
Indebtedness to the holder, or any part thereof. The security herein and
hereby provided shall not affect or be affected by any other Security
Instrument or by any other or further security heretofore or hereafter taken
for the Secured Indebtedness or any part thereof. Mortgagor, for Mortgagor and
Mortgagor's Successors, and for any and all persons ever claiming any interest
in the Mortgaged Properties, hereby waives all rights of marshalling in event
of foreclosure of the lien hereby created. No failure to exercise and no delay
in exercising on the part of the holder any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power or privilege preclude any other or further exercise thereof,
or the exercise of any other right, power or privilege.

7.3 For all purposes of this instrument, the post office address
of Bank shall be: P.O. Box 655415, Dallas, Texas 75265-5415, Attention: Mynan
C. Feldman, Vice President, and the address of Mortgagor shall be: 5949 Sherry
Lane, Suite 1616, Dallas, Texas 75225.

7.4 No provision herein or in any promissory note, instrument, or
any other loan document executed by Mortgagor evidencing the Secured
Indebtedness shall require the payment or permit the collection of interest in
excess of the maximum permitted by law. If any excess of interest in such
respect is provided for herein or in any such promissory note, instrument, or
any other loan document, the provisions of this Section 7.4 shall govern, and
Mortgagor shall not be obligated to pay the amount of such interest to the
extent that it is in excess of the amount permitted by law. The intention of
the parties being to conform strictly to the usury laws now in force, all
promissory notes, instruments and other loan documents executed by Mortgagor
evidencing the

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<PAGE> 13
Secured Indebtedness shall be held subject to reduction to the amount allowed
under said usury laws as now or hereafter construed by the courts having
jurisdiction.

7.5 These presents shall be binding upon the Mortgagor and
Mortgagor s Successors, and shall inure to the benefit of the holder, its
successors and assigns, and shall be covenants running with the Lands.

7.6 In the event that any one or more of the provisions contained
in this Mortgage shall be invalid, illegal or unenforceable in any respect
under any law, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby. In case any term or provision hereof is inconsistent with any term or
provision contained in the Loan Agreement, the term or provision contained in
the Loan Agreement shall be controlling.

7.7 THIS MORTGAGE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF OKLAHOMA.

7.8 This Mortgage has simultaneously been executed in a number of
identical counterparts, each of which, for all purposes, shall be deemed an
original, and all of which are identical except that, to facilitate
recordation, in any particular counterpart, portions of Exhibit "A" which
describe properties and interests situated in counties other than the county in
which such particular counterpart is to be recorded may have been omitted.

7.9 The use of any particular pronoun herein shall mean and be
construed to include the plural and singular number of such pronoun, whenever
and wherever appropriate and applicable, and shall mean and be construed to
include the masculine, feminine or neuter gender of such pronoun, whenever and
wherever appropriate and applicable.

7.10 The effective date of the assignment contained in Article 5 is
the date of execution of this Mortgage at 7:00 o'clock a.m.

EXECUTED this first day of April, but effective as of the first day of
April, in multiple counterparts.

BRIGHAM OIL & GAS, L.P.
a Delaware limited partnership
By: Brigham Exploration Company
Managing General Partner

By:
-----------------------------
Name: Anne L. Brigham
Title: Executive Vice President
of Brigham Exploration Company

BANK ONE, TEXAS, N.A.,
a national banking association

By:
------------------------
Name: Mynan C. Feldman
Title: Vice President

THE STATE OF TEXAS )
)
COUNTY OF DALLAS )

BEFORE ME, the undersigned, a Notary Public in and for the State of
Texas, on this day personally appeared Anne L. Brigham, Executive Vice
President of Brigham Exploration Company, known to me to be the person whose
name is subscribed to the foregoing instrument, and acknowledged to me that the
same was the act of Brigham Oil & Gas, L.P., a Delaware limited partnership,
acting by and through Brigham Exploration Company, as managing general partner
of Brigham Oil & Gas, L.P., and that said corporation executed said

- 13 -
<PAGE> 14
instrument as the act of Brigham Oil & Gas, L.P. for the purposes and
consideration therein expressed, and in the capacity therein stated.

GIVEN UNDER MY HAND AND SEAL OF OFFICE, this first day of April, 1996.

My Commission Expires: -------------------------------
Notary Public, State of Texas

- ---------------------
-------------------------------
(Printed or Typed Name of Notary)

THE STATE OF TEXAS )
)
COUNTY OF DALLAS )

BEFORE ME, the undersigned, a Notary Public in and for the State of
Texas, on this day personally appeared Mynan C. Feldman, Vice President of BANK
ONE, TEXAS, N.A., a national banking association, known to me to be the person
whose name is subscribed to the foregoing instrument and acknowledged to me
that the same was the act of said association, and that he executed said
instrument as the act of such association for the purposes and consideration
therein expressed, and in the capacity therein stated.

GIVEN UNDER MY HAND AND SEAL OF OFFICE, this first day of April, 1996.

My Commission Expires: -------------------------------
Notary Public, State of Texas

- ---------------------
-------------------------------
(Printed or Typed Name of Notary)

- 14 -

<PAGE> 1

EXHIBIT 10.12.4

ATTENTION ___________________ COUNTY CLERK, TEXAS:

Recording requested by and when recorded mail to:

BANK ONE, TEXAS, N.A.
c/o Robert N. Rule, Jr.,
Locke Purnell Rain Harrell
(A Professional Corporation)
2200 Ross Avenue, Suite 2200
Dallas, Texas 75201

DEED OF TRUST, SECURITY AGREEMENT,
ASSIGNMENT OF PRODUCTION
AND FINANCING STATEMENT

THE STATE OF TEXAS )
) KNOW ALL MEN BY THESE PRESENTS:
COUNTIES OF BORDEN, )
DAWSON, HARDEMAN, )
HOWARD, JONES, MARTIN )
ROBERTS, SCURRY, )
SHACKELFORD, STEPHENS, )
STONEWALL and THROCKMORTON )

WHEREAS, BRIGHAM OIL & GAS, L.P., a Delaware limited partnership, the
address of which is 5949 Sherry Lane, Suite 1616, Dallas, Texas 75225
(hereinafter referred to as "Grantor"), does hereby execute this Deed of Trust,
Security Agreement, Assignment of Production and Financing Statement
(hereinafter referred to as the "Deed of Trust"), for the use and benefit BANK
ONE, TEXAS, N.A., national banking association (hereinafter referred to as the
"Bank"), the address of which is 1717 Main Street, Dallas, Texas 75201;
covering oil and gas properties herein described located on lands situated in
the Counties of Borden, Dawson, Hardeman, Howard, Jones, Martin, Roberts,
Scurry, Shackelford, Stephens, Stonewall and Throckmorton, Texas.

NOW, THEREFORE, for and in consideration of the sum of Ten Dollars
($10.00) and other good and valuable consideration, in hand paid by Bank to
Grantor, the receipt and sufficiency of which are hereby acknowledged and
confessed, Grantor does hereby GRANT, BARGAIN, SELL, TRANSFER, ASSIGN and
CONVEY unto Mynan C. Feldman, as Trustee (hereinafter referred to as the
"Trustee"), for the use and benefit of Bank all right, title and interest now
or at any time hereafter vested in Grantor, or either of them, in and to the
following described properties and interests, to wit:

(c) All real property described or referred to in Exhibit
"A" (hereinafter collectively referred to as the "Lands"), even though
Grantor's rights, titles and interests be incorrectly or
insufficiently described or referred to therein, or a description of a
part or all of such rights, titles and interests be omitted from
Exhibit "A";

(d) Any and all oil, gas and mineral leases described or
referred to in Exhibit "A" (herein collectively referred to as the
"Leases") and any and all other oil, gas and mineral leases
<PAGE> 2
insofar as they cover all or any part of the Lands, together with all
right, title and interest now or at any time hereafter vested in
Grantor in and to any and all overriding royalty interests, mineral
interests, royalty interests, net profit interests, oil payments,
production payments and all other interests and properties of every
kind and character insofar as they cover any of the Lands or the
Leases insofar as the Leases cover the Lands, even though such rights,
titles and interests be incorrectly or insufficiently described or
referred to therein, or a description of a part or all of such rights,
titles and interests be omitted from Exhibit "A" together with any and
all renewals, extensions, substitutions, ratifications, supplements,
amendments and replacements of and for any of the Leases or other
interests described or referred to herein insofar as the same cover
the Lands;

servitudes, surface leases and rights-of-way situated upon or used
orixtures, hereditaments, improvements, easements, permits, licenses,
servitudes, surface leases and rights-of-way situated upon or used or
useful or held for use in connection with the exploration, development
or operation of the foregoing properties and interests, or the
production, treating, storing or transportation of oil, gas and other
hydrocarbons therefrom, including, without limitation, liquid
extraction plants, plant compressors, field gathering systems, valves,
fittings, engines, boilers, meters, cables, wires, towers, tubing and
rods, casing, connections, tanks and tank batteries, separators,
lines, pumps, pipes, pipelines, structures, buildings, sheds, oil
wells, gas wells, injection wells, other wells, fixtures, tools,
machinery and other equipment, power lines, telephone and telegraph
lines, and other appurtenances, apparatus, appliances and property of
every kind and character, movable or immovable, now or at any time
hereafter located on the Lands, or which may now or hereafter be used
or obtained in connection therewith, whether or not the same are
described or referred to in Exhibit "A", together with all additions,
substitutions, replacements, accessions and attachments to any and all
of the foregoing properties;

(e) All oil, casinghead gas and gas sales, purchase,
exchange and processing contracts and agreements, and all other
contracts, agreements and instruments, whether now in existence or
hereafter made, which relate to (but only to the extent the same
relate to) any of the properties and interests described or referred
to in Exhibit "A", whether or not such contracts and agreements are
described or referred to in Exhibit "A", together with any and all
renewals, extensions, substitutions, ratifications, supplements,
amendments and replacements of or for any such contracts, agreements
and instruments, to the extent such relate to such properties and
interests;

(f) All oil, gas and other hydrocarbons, including,
without limitation, casinghead gas, condensate, distillate, liquid
hydrocarbons, gaseous hydrocarbons, and all products separated,
settled and dehydrated therefrom, and all products refined therefrom,
including, without limitation, kerosene, liquified petroleum gas,
refined lubricating oils, diesel fuel, drip gasoline and natural
gasoline, and all other minerals, and the proceeds thereof, produced
and to be produced from and which accrue or are attributable to any of
the above described or referenced properties and interests, by virtue
of the above described or referenced contracts, agreements and
instruments; and

(g) Any and all proceeds, rents, issues, profits,
products, revenues and other income arising from or by virtue of the
sale, lease or other disposition of, or from any insurance payable
with respect to damage, loss or destruction of, the collateral
described in Subparagraphs (a) through (g) above.

It is expressly understood and agreed by the parties hereto that any
and all decimal fractional interests and/or well names set out in Exhibit "A"
pertaining to any of the properties and interests described or referred to in
Exhibit "A" have been appended for informational purposes only and shall not
limit in any way whatsoever the interest of Grantor in such properties and
interests, or interests derived thereunder, which are subject to this Deed of
Trust, Security Agreement, Assignment of Production and Financing Statement
(hereinafter referred to as this "Deed of Trust").

Grantor's interests in the properties and interests described in
Subparagraphs (a) through (h) above are all hereinafter sometimes collectively
referred to as the "Mortgaged Properties".

- 2 -
<PAGE> 3
TO HAVE AND TO HOLD the Mortgaged Properties, together with all the
rights, hereditaments and appurtenances in anywise appertaining or belonging
thereto, unto Trustee and his successors or substitutes in this trust, and his
and their assigns, in trust and for the uses and purposes hereinafter set
forth, forever.

The term "Grantor's Successors" as used herein, shall mean Grantor's
heirs, executors, legal representatives, successors and assigns. Grantor
hereby binds Grantor and Grantor's Successors to warrant and forever defend,
all and singular, the Mortgaged Properties, subject to the Permitted Liens (as
defined in the Loan Agreement), unto Trustee and his successors or substitutes
in this trust, and his and their assigns, forever, against every person
whomsoever lawfully claiming or to claim the same or any part thereof.

The term "Loan Agreement", as used herein, means that certain Loan
Agreement of even date herewith, executed between Grantor and Bank.

ARTICLE 1
REPRESENTATIONS AND WARRANTIES

1.1 Grantor hereby expressly represents and warrants to Bank that
(a) the Leases are in full force and effect; (b) Grantor's interests in the
Leases are valid and subsisting on the Lands and entitle Grantor to receive
that proportion (indicated as "NRI") of the total production from the Mortgaged
Properties indicated in connection with the descriptions thereof in Exhibit
"A", subject to matters disclosed in Exhibit A and to Permitted Liens, which
altogether do not cause the working interests of Grantor to be greater than or
the net revenue interests of Grantor to be less than indicated on Exhibit A;
(c) Grantor has good, valid and indefeasible title to Grantor's interest in the
Leases and to Grantor's interest in the personal property and fixtures
comprising a part of the Mortgaged Properties or used or obtained in connection
therewith, except for Permitted Liens (as that term is defined in the Loan
Agreement) and except as provided in Exhibit "A" and the right, power and
authority to execute and deliver this Deed of Trust and convey the Mortgaged
Properties; (d) the Mortgaged Properties are free and clear of all claims,
liens, encumbrances, security interests, contracts, agreements, options,
preferential purchase rights or other restrictions or limitations of any nature
or kind, except for Permitted Liens (as defined in the Loan Agreement) and
except as expressly provided herein; (e) all rentals, royalties and other
amounts due and payable under the Leases have been duly paid, and obligations
to be performed under the Leases as to the Lands have been duly performed; (f)
the holder shall quietly enjoy and possess the Mortgaged Properties; (g)
Grantor is not a party to, and none of the hydrocarbons produced from any of
the wells located on the Leases are the subject of, any Advance Payment
Contract affecting or relating to any of the Mortgaged Properties. As used
herein, the term "Advance Payment Contract" means any contract whereby Grantor
either (1) receives or becomes entitled to receive (either directly or
indirectly to a third party for Grantor's account or benefit) any payment (an
"Advance Payment") to be applied toward payment of the purchase price of
hydrocarbons produced or to be produced from any of the Mortgaged Properties
and which Advance Payment is paid in advance of actual delivery of such
production to or for the account of the purchaser regardless of such
production, or (2) grants an option or right of refusal to the purchaser to
take delivery of such production in lieu of payment, and, in either of the
foregoing instances, the Advance Payment is, or is to be, applied as payment in
full for such production when sold and delivered or is, or is to be, applied as
payment for a portion only of the purchase price thereof or of a percentage or
share of such production; provided that (A) inclusion of the standard "take or
pay" provision in any gas sales or purchase contract shall not, in and of
itself, constitute such a contract as an Advance Payment Contract for the
purposes hereof, and (B) neither a hedging, swap or other similar arrangement,
nor a gas balancing agreement shall constitute an Advance Payment Contract; (h)
Grantor and any guarantor of the Secured Indebtedness (hereinafter defined) are
now in a solvent condition; (i) no bankruptcy or insolvency proceedings are
pending contemplated or threatened by or against Grantor and any guarantor of
the Secured Indebtedness; and (j) no other judicial or administrative actions,
suits or proceedings are pending, contemplated or threatened by or against
Grantor and any guarantor of the Secured Indebtedness.

ARTICLE 2
SECURED INDEBTEDNESS

2.1 This Deed of Trust is given to secure payment and performance
of the following indebtedness, obligations and liabilities, to wit:

(a) That certain Revolving Note dated as of even date
herewith in the original principal amount of Twenty-Five Million and
No/100 Dollars ($25,000,000.00), executed by Grantor, as Maker,
payable to the order of Bank, bearing interest as provided therein and

- 3 -
<PAGE> 4
containing usual and customary provisions for collection and
attorneys' fees (hereinafter referred to as the "Note"), and any and
all renewals, increases, refundings, substitutions, replacements,
consolidations and/or extensions of or for the Note;

(c) All indebtedness, obligations and liabilities arising
pursuant to the provisions of this Deed of Trust, and any and all
other deeds of trust, mortgages, indentures, security agreements,
pledge agreements, collateral mortgages, collateral chattel mortgages,
assignments, or other conveyances, whether now existing or hereafter
arising, and all supplements, amendments, restatements, modifications
and replacements thereof or therefor, executed or to be executed by
Grantor or any guarantor of the Secured Indebtedness to secured the
Secured Indebtedness, or for the use and benefit of Bank, together
with any and all renewals, increases, refundings, substitutions,
replacements, consolidations and/or extensions of or for any such
indebtedness, obligations and liabilities, or any part thereof
(hereinafter collectively referred to as the "Security Instruments");

(d) All loans and advances which Bank may hereafter make
to Grantor and any and all renewals, increases, refundings,
substitutions, replacements, consolidations and/or extensions of any
and all such loans and advances, or any part thereof; and

(e) All other and additional debts, obligations and
liabilities of every kind and character of Grantor now existing or
hereafter arising in favor of Bank, regardless of whether such debts,
obligations and liabilities are direct or indirect, primary or
secondary, joint, several or joint and several, fixed or contingent,
and regardless of whether such present or future debts, obligations
and liabilities may, prior to their acquisition by Bank, be or have
been payable to, or be or have been in favor of, some other persons or
have been acquired by Bank in a transaction with one other than
Grantor together with any and all renewals, increases, refundings,
substitutions, replacements, consolidations and/or extensions of or
for any and all such debts, obligations, and liabilities, or any part
thereof (it being contemplated that Bank may lend additional sums of
money to Grantor from time to time, but shall not be obligated to do
so, and that all such additional sums and loans shall be part of the
"Secured Indebtedness" as hereinafter defined).

ARTICLE 3
COVENANTS

3.1 The covenants, agreements and undertakings of Grantor
contained in this Deed of Trust, whether in this Article 3 or elsewhere, are
made by Grantor for Grantor and Grantor's Successors.

3.2 Grantor hereby covenants, agrees and specifically undertakes
hereby:

(a) In all material respects, to maintain, preserve and
keep or cause to be maintained, preserved and kept Grantor's interests
in the Mortgaged Properties and all appurtenances thereto, including,
without limitation, all buildings, improvements, machinery, equipment,
pipelines, fixtures and other personal property of every kind and
character, in respect of the Leases, in thorough repair, working order
and condition, and from time to time, at Grantor's own expense, do or
cause to be done all necessary and proper repairs, renewals,
replacements and substitutions of the Mortgaged Properties and all
appurtenances thereto, so

- 4 -
<PAGE> 5
that at all times the state and condition of the Mortgaged Properties
and all appurtenances thereto will be fully preserved and maintained;

(b) To the extent Grantor has the right to do so, permit
or cause to be permitted the holder, its agents, employees and
representatives, at their own risk, to go upon, examine, inspect and
remain on the Mortgaged Properties, and to go upon the derrick floor
of any well or wells at any time drilled or being drilled thereon, and
to strap, gauge, measure and inspect any and all tanks at any time on
the Mortgaged Properties or holding oil, gasoline or casinghead
gasoline therefrom; and Grantor shall do or cause to be done all
things necessary and/or proper to enable the holder to exercise said
rights whenever it so desires; information so obtained shall be
subject to the Bank's obligations to maintain confidentiality, as
provided in Section 12(i) of the Loan Agreement;

(c) To promptly notify the holder in writing if the
validity or priority of this Deed of Trust or any of the rights,
titles, liens or security interests created or evidenced hereby with
respect to the Mortgaged Properties, or any part thereof, shall be
questioned, attacked or endangered, directly or indirectly, and do or
cause to be done all things necessary and/or proper to protect,
warrant and defend title to the Mortgaged Properties unto the holder
and its successors and assigns at Grantor's sole expense against all
persons whomsoever claiming an interest therein or a lien thereon, but
the holder shall have the right, at any time, to intervene in any suit
affecting such title and to employ independent counsel in connection
with any such suit to which it may be a party by intervention or
otherwise; and upon demand Grantor agrees to pay the holder all
reasonable expenses paid or incurred by it in respect of any such suit
affecting title to any such property or affecting the holder's rights,
titles, liens or security interests hereunder, including, without
limitation, reasonable fees to the holder's attorneys, and Grantor
will indemnify and hold the holder harmless from and against any and
all costs and expenses, including, without limitation, any and all
costs, loss, damage or liability which the holder may suffer or incur
by reason of the failure of the title to all or any part of the
Mortgaged Properties, or by reason of the failure or inability of
Grantor, for any reason, to convey the rights, titles, liens and
security interests which this Deed of Trust purports to mortgage,
create or assign, and all amounts at any time so payable by Grantor
shall be secured by the lien and security interest hereof and by the
assignment of production herein contained;

(e) To promptly furnish the holder with the financial
information, statements, and reports required to be furnished to Bank
in accordance with the Loan Agreement;

(f) To pay all Secured Indebtedness in accordance with
the terms thereof or hereof, or when the maturity thereof be
accelerated in accordance with the terms thereof or hereof;

(g) To promptly pay and discharge or cause to be promptly
paid and discharged all rentals, delay rentals, royalties and
indebtedness accruing under, and to perform or cause to be performed
in all material respects each and every act, matter or thing required
by each and all of the assignments, deeds, Leases, subleases,
contracts and agreements comprising a part of or affecting Grantor's
interests in the Mortgaged Properties, and to do or cause to be done
all other things necessary to keep unimpaired in all material respects
Grantor's rights with respect thereto and to prevent any forfeiture
thereof or default thereunder; provided, however, that nothing in
this Deed of Trust shall be deemed to (1) require the Grantor to
perpetuate or renew any oil and gas lease or other lease by payment of
rental or delay rental or by commencement or continuation of
operations, or (2) prevent the Grantor from abandoning or releasing
any oil and gas lease or other lease or well thereon, when in any such
events, in the opinion of Grantor, exercised in good faith, it is not
in the best interest of Grantor to perpetuate the same;

- 5 -
<PAGE> 6
(h) To do or cause to be done such development work as
may be reasonably necessary to the prudent and economical operation of
the Mortgaged Properties in accordance with the generally accepted
practices of prudent operators in the industry, including all actions
that may be appropriate to protect from diminution the productive
capacity of each producing well on the Mortgaged Properties (including,
without limitation, cleaning out and a reconditioning wells), and to
protect the Mortgaged Properties against drainage whenever, and as
often as, is necessary;

(i) To promptly correct and cure any defect, error or
omission which may be discovered in the contents of this Deed of Trust
or in any other Security Instrument or in the execution or
acknowledgement hereof or thereof and in connection therewith,
promptly execute, acknowledge and deliver to the holder any and all
such corrective or curative instruments as the holder may in its sole
and absolute discretion deem necessary or appropriate, and pay all
costs and expenses, including, without limitation, the reasonable
attorneys' fees of the holder, in connection with any of the
foregoing; and

(j) To comply in all respects with the affirmative and
negative covenants contained in the Loan Agreement, as the same may be
supplemented, amended, modified and replaced from time to time.

3.3 Any and all covenants contained in this Deed of Trust may from
time to time, by instrument in writing signed by the holder and delivered to
Grantor, be waived to such extent and in such manner as the holder may consider
appropriate; but no such waiver shall at any time affect or impair the holders
rights or liens hereunder, except to the extent so specifically stated in such
written instrument.

ARTICLE 4
DEFAULTS AND REMEDIES

4.1 The term "Event of Default", as used herein, shall mean the
occurrence of any one or more of the following events:

(a) Any Event of Default specified in the Loan Agreement,
any of the Security Instruments or any other agreement or contract
existing at the date hereof or hereinafter entered into between
Grantor and Bank shall have occurred or any supplement, amendment
modification or replacement for any such agreement; and/or

(b) The title of Grantor or Bank to the Mortgaged
Properties, or a substantial part thereof, becomes the subject matter
of litigation or other judicial proceeding which, in the good faith
opinion of Bank, would likely result in substantial impairment or loss
of the lien and security interest intended to be created by this Deed
of Trust;

then, upon the occurrence of any such Event of Default the Bank shall have all
of the rights and remedies provided for in the Loan Agreement.

4.2 If Grantor should fail, refuse or be unable to pay any sum of
money herein covenanted to be paid by Grantor, or fail, refuse or be unable to
observe, keep or perform any additional covenant, agreement or undertaking
whatsoever contained in this Deed of Trust, the holder may, but shall not be
obligated to, pay said sums of money, or perform or attempt to perform any such
covenant, agreement or undertaking and any such payment so made or expense
reasonably incurred in the performance or attempted performance of any such
covenant, agreement or undertaking shall be, and is hereby declared by Grantor
above all sums so advanced or paid by the holder, with interest at the Default
Rate (as defined in the Loan Agreement) from the date paid or incurred by the
holder. No such payment by the holder shall in any way be considered or
constitute a waiver

- 6 -
<PAGE> 7
of any such default or of the holder's right to declare the Secured
Indebtedness at once due and payable. In addition to the lien and security
interest hereof, the holder shall be subrogated to all rights and liens
securing the payment of any debt, claim, tax or assessment for the payment of
which it shall havel be subrogated to all rights and liens securing the payment
of any debt, claim, tax or assessment for the payment of which it shall have
made such advance.

4.3 Upon the occurrence of an Event of Default, and if such Event
of Default is continuing, the holder may, at its option, in addition to any and
every other remedy, request Trustee to proceed with foreclosure, and in such
event, Trustee is hereby authorized and empowered, and it shall be its special
duty, upon such request of holder, to sell the Mortgaged Properties, as a whole
or in lots or parcels, as Trustee may deem proper, to the highest bidder or
bidders, for cash, at the courthouse door of the county in the State of Texas
wherein the Mortgaged Properties, then subject to the lien hereof, are
situated, provided that if any of the Mortgaged Properties be situated in more
than one county, such sale shall be made in any county in the State of Texas
wherein any part of such Mortgaged Properties subject to the lien hereof is
situated. Any such sale shall be made at public outcry, between the hours of
ten o'clock (10:00) a.m. and four o'clock (4:00) p.m. and at a time not later
than three (3) hours from the time set forth in the notice hereinafter
described, on the first Tuesday in any month after advertising the time, place
and terms of the sale of the Mortgaged Properties, then subject to the lien
hereof, for at least twenty-one (21) days preceding the date of sale by posting
written or printed notice thereof at the courthouse door of the county where
said Mortgaged Properties are situated and by filing such notice with the
County Clerk of such county (provided that where any of the Mortgaged
Properties are situated in more than one county the notice to be posted and
filed for record as herein provided shall be posted at the courthouse door of
each of such counties where said Mortgaged Properties are situated, and filed
for record in each of such counties, and the notices so posted and filed for
record shall designate the county where the Mortgaged Properties will be sold),
which notice may be posted and filed for record by Trustee acting, or by any
person acting for him, and the holder has, at least twenty-one (21) days
preceding the date of sale, served written or printed notice of the proposed
sale by certified mail on each debtor obligated to pay the Secured Indebtedness
according to the records of holder, by the deposit of such notice, enclosed in
a post-paid wrapper, properly addressed to such debtor at debtor's most recent
address as shown by the records of holder, in a post office or official
depository under the care and custody of the United States Postal Service, and
after such sale to make to the purchaser or purchasers thereunder good and
sufficient deeds and assignments, in the name of Grantor, conveying said
property so sold to the purchaser or purchasers with general warranty of title
by Grantor. The sale of any part of the Mortgaged Properties shall not exhaust
the power of sale, but sales may be made from time to time until all property
is sold or the Secured Indebtedness is paid in full. It shall not be necessary
to have present or to exhibit at any such sale any of the personal property
subject to the lien hereof. To the extent permitted by applicable law, any
sale hereunder may be adjourned by announcement at the time and place appointed
for such sale, without further notice except as may be required by applicable
law.

Trustee and/or the holder may, at their option, and are hereby authorized,
prior or subsequent to the exercise of any remedies under Section 4.3 hereof, to
enter upon the Mortgaged Properties, or any part thereof, and to take
possession of the Mortgaged Properties in the possession of Grantor or
Grantor's Successors, and may exclude Grantor or Grantor's Successors, and all
persons claiming under Grantor, wholly or partly therefrom; and, holding the
same, the Trustee and/or the holder may exercise without interference from
Grantor or Grantor's Successartly therefrom; and, holding the same, the Trustee
and/or the holder may exercise without interference from Grantor or Grantor's
Successors, any and all rights which Grantor has with respect to the
management, possession, operation, protection or preservation of the Mortgaged
Properties, and the Trustee and/or the holder may use, administer, manage,
operate and control the Mortgaged Properties andconduct the business thereof to
the same stead of Grantor, or otherwise as the Trustee and/or the holder shall
deem best. All reasonable costs, expenses and liabilities of every character
incurred by the Trustee and/or the holder shall be a demand obligation owed by
Grantor to holder and shall bear interest at the rate specified (as defined in
the Loan Agreement) and shall constitute a portion of the Secured Indebtedness
and shall be secured by this Deed of Trust and all of the Security Instruments.
If necessary to obtain the possession provided for hereinabove, the Trustee
and/or the holder, as the case may be, may invoke any one or more actions for
forcible entry and detainer, trespass to try title and restitution. In
connection with any action taken by the Trustee and/or the holder pursuant to
this Section 4.4, neither the Trustee nor the holder shall be liable for any
loss sustained by Grantor resulting from any act or omission ofthe Trustee or
the holder in managing the Mortgaged Properties, unless such loss is caused by
the willful misconduct or bad faith of the holder or the Trustee. Grantor
hereby agrees to indemnify and hold harmless the Trustee and the holder from
and against any and all liability, loss or damage which may be incurred by
reason of the exercise of rights or remedies hereunder. Should the holder or
Trustee incur any such liability by reason of this Deed of Trust or the
exercise of rights or remedies hereunder or in

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<PAGE> 8
defense of any such claims or demands, the amount thereof, including without
limitation, costs, expenses and reasonable attorneys' fees, shall be of any such
claims or demands, the amount thereof, including without limitation, costs,
expenses and reasonable attorneys' fees, shall be a demand obligation owing by
Grantor to the holder or the Trustee, as the case may be, and shall bear
interest each day from the date incurred until paid at the rate specified in
Section 4.2 hereof, and shall be a part of the Secured Indebtedness and shall
be secured by this Deed of Trust and all of the Security Instruments. Grantor
hereby consents to, ratifies and confirms any and all actions of the holder or
the Trustee with respect to the Mortgaged Properties taken under this Section
4.4.

4.4 Trustee is authorized to receive the proceeds of said sale or
sales made pursuant to Section 4.3 hereof and apply the same as follows: First,
to the payment of all necessary costs and expenses incident to the execution of
said trust, including but not limited to a reasonable fee to Trustee, not to
exceed five percent (5%) to be calculated upon the amount realized at said
sale; Second, to the payment of the Secured Indebtedness in such order as the
holder shall elect; and Third, the balance, if any, remaining after the full
and final payment of the Secured Indebtedness, to Grantor or Grantor's
Successors.

4.5 It is agreed that in any deed or deeds given by Trustee or any
substitute Trustee duly appointed hereunder, any and all statements of fact or
other recitals therein made as to the identity of the holder or as to the
occurrence or existence of any default, or as to the acceleration of the
maturity of the Secured Indebtedness, or as to the request to sell, notice of
sale, time, place, terms and manner of sale, and receipt, distribution and
application of the money realized therefrom, or as to the due and proper
appointment of a substitute Trustee, and, without being limited by the
foregoing, as to any act or thing having been duly done by the holder, or any
of them if there be more than one, or by the Trustee or any substitute Trustee,
shall be taken by all courts of law and equity as prima facie evidence that the
said statements of recitals state facts and are without further question to be
so accepted, and Grantor does hereby ratify and confirm any and all acts that
Trustee, or any substitute Trustee, may lawfully do in the premises by virtue
hereof.

4.6 In case the lien and security interest thereof shall be
foreclosed by Trustee's sale or by judicial action, the purchaser at any such
sale shall receive, as an incident to its ownership, immediate possession of
the property purchased, and Grantor agrees for Grantor and for all persons
claiming under Grantor, that if Grantor or any such person shall hold
possession of said property, or any part thereof, subsequent to foreclosure,
Grantor or the parties so holding possession shall be considered as tenants at
sufferance of the purchaser at foreclosure sale, and anyone occupying the
property after demand for possession thereof shall be guilty of forcible
detainer and shall be subject to eviction and removal, forcible or otherwise,
with or without process of law, and all damages by reason thereof are hereby
expressly waived.

4.7 Upon the occurrence of an Event of Default, and if such Event
of Default is continuing, the holder may, at its election, or Trustee may upon
written request of the holder, proceed by suit or suits, at law or in equity,
to enforce the payment of the Secured Indebtedness in accordance with the terms
hereof and of the notes or other instruments evidencing it, to foreclose the
lien and security interest of this Deed of Trust as against all or any portion
of the Mortgaged Properties, and to have said properties sold under the
judgment or decree of a court of competent jurisdiction. On or at any time
after the filing of judicial proceedings to protect or enforce the rights of
the holder, the holder, as a matter of right and without regard to the
sufficiency of the security, and without any showing of insolvency, fraud or
mismanagement on the part of Grantor, shall be entitled to the appointment of a
receiver or receivers of the Mortgaged Property, and of the income, rents,
issues, products, profits and proceeds thereof.

4.8 It is agreed that Bank or any other holder may be the
purchaser of the Mortgaged Properties, or of any part thereof, at any sale
thereof whether such sale be under the power of sale hereinabove vested in
Trustee or upon any other foreclosure of the lien and security interest hereof
or otherwise, and Bank or other holder so purchasing shall, upon any such
purchase, acquire good title to the Mortgaged Properties so purchased, free of
the lien and security interest of these presents.

4.9 To the full extent permitted by applicable law, Grantor agrees
that it will not at any time insist upon, plead, claim or take the benefit or
advantage of any law now or hereafter in force providing for any appraisement,
valuation, stay, extension or redemption, and Grantor, for Grantor and
Grantor's Successors, and for any and all persons claiming any interest in the
Mortgaged Properties, hereby waives and releases, except as expressly provided
herein, all rights of redemption, valuation, stay of execution, notice of
intention or the election to accelerate the Secured Indebtedness and all rights
to a marshalling of assets of Grantor, including

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<PAGE> 9
the Mortgaged Properties, or to a sale on inverse order of alienation in the
event of foreclosure of the liens and/or security interests hereby created.

4.10 The rights and remedies hereinabove expressly conferred are
cumulative of all other rights and remedies herein, or by law or in equity
provided, and shall not be deemed to deprive the holder or the Trustee of any
such other legal or equitable rights or remedies, by judicial proceedings or
otherwise, appropriate to enforce the conditions, covenants and terms of this
Deed of Trust and of the notes or other instruments evidencing the Secured
Indebtedness, and the employment of any remedy hereunder, or otherwise, shall
not prevent the concurrent or subsequent employment of any other appropriate
remedy or remedies.

4.11 In the event the Mortgaged Properties, or any part thereof,
shall be located in any state other than the State of Texas, the procedures for
foreclosure and all other provisions of this Article 4 relating to remedies
upon default and related matters shall be modified to the extent necessary to
comply with the laws of the state where such properties are located. It is the
intent of Grantor that this Deed of Trust shall be legal and enforceable in any
state where the Mortgaged Properties, or any part thereof, are located and that
the provisions hereof shall be modified only to the extent necessary to comply
with the laws of such state, and that all other provisions contained herein
shall be in no way affected or impaired by the necessity to so modify some or
all of the provisions of this Article 4.

ARTICLE 5
ASSIGNMENT OF PRODUCTION

5.1 In order further to secure the payment of the Secured
Indebtedness, Grantor does hereby TRANSFER, ASSIGN, and CONVEY unto and in
favor of the holder all of the interest of Grantor in the oil, gas, casinghead
gas, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and
other minerals (herein collectively referred to as the "Hydrocarbons"), in and
under, or which may be produced from, the Mortgaged Properties, or allocated
thereto pursuant to pooling or unitization of the Leases or otherwise, together
with all accounts, contract rights, general intangibles, products and proceeds
arising from or derived from the sale, transfer or other disposition of such
Hydrocarbons on and after the date of the execution of this Deed of Trust.

5.2 The foregoing assignment is made upon, and subject to, the
following terms:

(b) All parties producing, purchasing, taking,
possessing, processing or receiving any such Hydrocarbons, or having
in their possession any such Hydrocarbons or such proceeds for which
they or others are accountable to the holder by virtue of the
provisions of this Section 5.2, are authorized and directed by
Grantor, upon receipt of notice by the holder given pursuant to
Subsection 5.2(a) above, to treat and regard the holder as the
assignee and transferee of Grantor and entitled in its place and stead
to receive such Hydrocarbons and proceeds; and such parties and each
of them shall be fully protected in so treating and regarding the
holder and shall be under no obligation to see to the application by
the holder of any such proceeds received by it. Until such notice is
received by such parties, payment of all proceeds attributable to such
Hydrocarbons shall be payable directly to Grantor. Without in any way
limiting the effectiveness of the authorization and direction in the
next preceding sentence, if Grantor shall receive any such proceeds
which under this Section 5.2 are receivable by the holder, after such
notice, Grantor will hold the same in trust and will remit such
proceeds, or cause such proceeds to be remitted, immediately, to the
holder.

(c) Without limiting the foregoing provisions of this
Article 5, Grantor stipulates that this Article 5 is intended to grant
to the holder a security interest in Grantor's interest in

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<PAGE> 10
the Hydrocarbons to be extracted from or attributable to the
Mortgaged Properties, and in and to the proceeds resulting from the
sale thereof at the well head.

5.3 Grantor covenants, agrees and specifically undertakes hereby,
to cause, after Bank shall have so requested, all pipeline companies or other
purchasers of the Hydrocarbons to pay promptly to the holder at its principal
office, Grantor's interest in the proceeds derived from the sale thereof, in
accordance with the terms of this assignment, and forthwith to execute,
acknowledge and deliver to such pipeline companies and other purchasers such
further and proper division orders, transfer orders, certificates and other
documents as may be necessary or proper to effect the intent of these presents;
and the holder shall not be required at any time, as a condition to its right
to obtain the proceeds of the Hydrocarbons, to warrant its title thereto or to
make any guaranty whatsoever. In addition, and without limitation, Grantor
covenants, agrees and specifically undertakes hereby, to provide to the holder
the name and address of every pipeline company or other purchaser of the oil,
gas and other minerals produced from or allocated to the Mortgaged Properties
when determined, together with a copy of the applicable purchase and sales
contracts. All expenses incurred by the holder in the collection of such
proceeds shall be repaid promptly by Grantor; and prior to such repayment, such
expenses shall be a part of the Secured Indebtedness.

5.4 Without limitation upon any of the foregoing, Grantor hereby
designates and appoints the holder as Grantor's true and lawful agent and
attorney-in-fact (with full power of substitution, either generally or for such
periods or purposes as the holder may from time to time prescribe), with full
power and authority, for and on behalf of and in the name of Grantor and only
upon an Event of Default, and while such Event of Default is continuing, to
execute, acknowledge and deliver all such division orders, transfer orders,
certificates and other documents of every nature, with such provisions as may
from time to time, in the opinion of the holder, be necessary or proper to
effect the intent and purpose of the assignment contained in this Article 5;
and to demand, collect, receive and sue for, in the holder's own name or in the
name of Grantor, all cash, other distributions or proceeds due or which may
become due to Grantor by virtue of the Mortgaged Properties or any part thereof
or interest therein, with the absolute right in the holder to rehypothecate,
pledge, compromise, settle or discharge the same and to do all acts and things
necessary or convenient for any such purpose, including, without limitation,
the right to give good and sufficient receipts and releases; to endorse the
name of Grantor upon any and all checks, drafts, money orders and other
instruments for the payment of monies which are payable to Grantor and
constitute collections on the Mortgaged Properties; and to perform such other
and further acts and deeds in the name of Grantor which the holder may deem
necessary and appropriate to effect the intent and purpose of the assignment
contained in this Article 5; and Grantor shall be bound thereby as fully and
effectively as if Grantor had personally executed, acknowledged and delivered
any of the foregoing certificates or documents; as if Grantor had personally
demanded, collected, received and/or sued for any and all cash, other
distributions or proceeds; as if Grantor had personally done any and all acts
and things necessary or convenient for any such purpose; as if Grantor had
personally endorsed Grantor's own name upon any and all checks, drafts, money
orders and other instruments; and as if Grantor personally performed such other
and further acts and deeds in Grantor's own name which the holder deemed
necessary and appropriate to effect the intent and purpose of the Assignment
contained in this Article 5; PROVIDED, HOWEVER, notwithstanding anything
contained herein to the contrary, the Assignment of Production contained in
Section 5.1 hereof, and the holders rights thereunder, shall be absolute and
shall not be conditioned upon the occurrence of an Event of Default. The
powers and authorities herein conferred on the holder may be exercised by the
holder through any person who, at the time of exercise, is an officer of the
holder. The power of attorney conferred by this Section 5.4 is granted for
valuable consideration and coupled with an interest and is irrevocable so long
as the Secured Indebtedness, or any part thereof, shall remain unpaid. All
persons dealing with the holder, or any substitute, shall be fully protected in
treating the powers and authorities conferred by this Section 5.4 as continuing
in full force and effect until advised by the holder that the Secured
Indebtedness is fully and finally paid.

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<PAGE> 11
require Grantor to make, a change of connection and the right to designate or
approve the purchaser with whose facilities a new connection shall be made, and
the holder shall be without liability or responsibility in connection therewith
so long as ordinary care is used in making such designation.

ARTICLE 6
SECURITY AGREEMENT

6.1 With respect to all personal property and fixtures comprising
a part of the Mortgaged Properties, together with all proceeds and products
thereof (hereinafter collectively referred to as the Collateral"), this Deed of
Trust shall likewise be a security agreement, and for a valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and for the
purpose of further securing payment and performance of the Secured
Indebtedness, Grantor hereby grants to Bank a security interest in the
Collateral including, without limitation, all rights now owned and at any time
hereafter acquired by Grantor in all (a) oil, gas and other minerals produced
from or allocated to the Mortgaged Properties, (b) accounts, chattel paper and
general intangibles arising in connection with the sale or other disposition of
such production, or otherwise associated with the Mortgaged Properties, and (c)
equipment, materials, other personal property, and fixtures at any time used on
or in connection with the Mortgaged Properties or in connection with such
production, (d) geological, geophysical, engineering, accounting, title, legal
and other technical or business data concerning the Mortgaged Properties, and
the Hydrocarbons which are in the possession of Grantor or in which Grantor can
otherwise grant a security interest, and all books, files, records, seismic
data, magnetic media or other forms of recording or obtaining access to such
data, together with all accessions, additions, proceeds, products,
replacements, substitutions, and modifications to or for any of the foregoing.

6.2 Grantor hereby assigns to Bank Grantor's security interests
and liens and all other interests of Grantor arising pursuant to or perfected
by any instrument to which Grantor is a party affecting real property in which
Grantor is an interest owner, as provided in Section 9.319 of the Texas
Business and Commerce Code (and as provided in any similar provisions, if any,
of the Uniform Commercial Code as enacted in any other state where the
Mortgaged Properties, or any part thereof, are situated), by virtue of the
first sale of Hydrocarbons produced from the Mortgaged Properties.

6.3 Grantor represents and warrants that, except for any financing
statement now in force filed by Bank, or Bank's predecessor-in-interest in and
to the Original Deed of Trust, or as shown on Exhibit "A", no financing
statement covering the Collateral, or any part thereof, has been filed with any
filing officer, and no other security interest now in force has attached or
been perfected in the Collateral, or any part thereof.

6.4 This Deed of Trust shall be effective as a financing statement
filed as a fixture filing with respect to all of the Collateral which is or
will become fixtures related to the Lands and Leases and is to be filed for
record as a financing statement in the real estate records of each county where
any part of the Mortgaged Properties (including such fixtures) is situated.
Such of the Mortgaged Properties which constitute minerals or the like
(including oil and gas) or accounts subject to subsection (e) of Section 9.103
of the Texas Business and Commerce Code (and to similar provisions, if any, of
the Uniform Commercial Code as enacted in any other state where the Mortgaged
Properties are situated) are or will be financed at the wellhead or minehead of
the well or mine located on the Lands described in Exhibit "A". This Deed of
Trust shall also be effective as a financing statement covering such minerals
or the like (including oil and gas) and such accounts, and, where so permitted
or required, is to be filed for record as such a financing statement in the
real estate records for each county where a mortgage on the Mortgaged
Properties would be filed or recorded. The above goods are or are to become
fixtures on the Lands. The record owner of the real estate interest covered by
this Deed of Trust is Grantor.

ARTICLE 7
MISCELLANEOUS

7.1 Upon the full and final payment of the Secured Indebtedness,
this Deed of Trust shall be extinguished and be of no further force and effect;
and the Mortgaged Properties shall become wholly free and clear hereof and all
of the property as assigned hereby shall be automatically reassigned to Grantor
without any

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<PAGE> 12
further act being required; and the holder, upon the request and at the expense
of Grantor, shall promptly deliver to Grantor such instruments evidencing the
Secured Indebtedness, marked "PAID", and execute and deliver to Grantor and
others a release of this Deed of Trust and such other instruments of
satisfaction as may be appropriate.

7.2 The rights, titles, interests, liens and powers hereunder are
cumulative of each other and of all other rights, titles, interests, liens' and
powers which may now or hereafter exist to secure the payment of the Secured
Indebtedness to the holder, or any part thereof. The security herein and
hereby provided shall not affect or be affected by any other Security
Instrument or by any other or further security heretofore or hereafter taken
for the Secured Indebtedness or any part thereof. Grantor, for Grantor and
Grantor's Successors, and for any and all persons ever claiming any interest in
the Mortgaged Properties, hereby waives all rights of marshalling in event of
foreclosure of the lien hereby created. No failure to exercise and no delay in
exercising on the part of the holder any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power or privilege preclude any other or further exercise thereof,
or the exercise of any other right, power or privilege.

7.3 For all purposes of this instrument, the post office address
of Bank shall be: P.O. Box 655415, Dallas, Texas 75265-5415, Attention: Mynan
C. Feldman, Vice President, and the post office address of Grantor shall be:
5949 Sherry Lane, Suite 1616, Dallas, Texas 75225.

7.4 No provision herein or in any promissory note, instrument, or
any other loan document executed by Grantor evidencing the Secured Indebtedness
shall require the payment or permit the collection of interest in excess of the
maximum permitted by law. If any excess of interest in such respect as
provided for herein or in any such promissory note, instrument, or any other
loan document, the provisions of this Section 7.4 shall govern, and Grantor
shall not be obligated to pay the amount of such interest to the extent that it
is in excess of the amount permitted by law. The intention of the parties
being to conform strictly to the usury laws now in force, all promissory notes,
instruments and other loan documents executed by Grantor evidencing the Secured
Indebtedness shall be held subject to reduction to the amount allowed under
said usury laws as now or hereafter construed by the courts having
jurisdiction.

7.5 These presents shall be binding upon the Grantor and Grantor's
Successors, and shall inure to the benefit of the holder, its successors and
assigns, and shall be covenants running with the Lands.

7.6 In the event that any one or more of the provisions contained
in this Deed of Trust shall be invalid, illegal or unenforceable in any respect
under any law, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby. In case any term or provision hereof is inconsistent with any term or
provision contained in the Loan Agreement, the term or provision contained in
the Loan Agreement shall be controlling.

7.7 THIS DEED OF TRUST SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, EXCEPT IN THOSE INSTANCES WHERE
THE MORTGAGED PROPERTIES COVERED HEREBY ARE LOCATED IN STATES OTHER THAN THE
STATE OF TEXAS. IN SUCH EVENT, THE LAW IN FORCE IN THE STATE WHERE THE
MORTGAGED PROPERTIES ARE LOCATED SHALL GOVERN THE CONSTRUCTION OF THIS DEED OF
TRUST.

7.8 This Deed of Trust has simultaneously been executed in a
number of identical counterparts, each of which, for all purposes, shall be
deemed an original, and all of which are identical except that, to facilitate
recordation, in any particular counterpart, portions of Exhibit A which
describe properties and interests situated in counties other than the county in
which such particular counterpart is to be recorded may have been omitted.

7.10 In reaching any opinion, making any determination or
requirement, or issuing any request, Bank shall act in good faith and in a
reasonable manner.

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<PAGE> 13
7.11 The effective date of the assignment contained in Article 5 is
the date of execution of this Deed of Trust at 7:00 o'clock a.m.

IN TESTIMONY WHEREOF, Grantor has caused this instrument to be
executed by its duly authorized trustee, effective as of the first day of
April, 1996.

BRIGHAM OIL & GAS, L.P.,
(#%

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<PAGE> 1
EXHIBIT 10.13

LEASE AGREEMENT

THE STATE OF TEXAS (
)
COUNTY OF DALLAS )

THIS LEASE AGREEMENT, made and entered into by and between the
Landlord and Tenant hereinafter named.

WITNESSETH:

1. DEFINITIONS AND BASIC PROVISIONS. The following definitions
and basic provisions shall be used in conjunction with and limited by the
reference thereto in the provisions of this Lease:

(a) "Landlord":Sterling Plaza Ltd., by Sterling Projects,
Inc., General Partner

(b) "Tenant":Brigham Oil & Gas, L.P. (A Delaware Limited
Partnership)

(c) "Premises": Consisting of approximately 6,038
square feet located in the Sterling Plaza Building (the "Building") as shown
on Exhibit "B" attached hereto.

The Building Address is:

5949 Sherry Lane
Suite 1616
Dallas, Texas 75225

(d) "Lease Term": A period of sixty ( 60 ) months,
commencing on June 1, 1992, (the "Commencement Date").

(e) "Basic Rental": $ 365,670.00

(f) "Monthly Rental Installment":$ 7,170.00* *except
that months
8, 11, 14,
20, 26, 32,
38, 44 and
56 the
Monthly
Installment
shall be
$0.00

(g) "Security Deposit": $ -0-

(h) "Permitted Use": General Office

(i) "Lease Year": A period of twelve months beginning on
the day and month on which the Commencement Date occurred and ending twelve
months thereafter.

(j) "Building Holidays": New Year's Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day.

2. LEASE GRANT. Landlord, in consideration of the Basic Rental
and the additional rental to be paid and the other covenants and agreements to
be performed by Tenant and upon the terms and conditions hereinafter stated,
does hereby lease, demise and let unto Tenant the Premises (as defined in
Paragraph 1(c) hereof) commencing on the Commencement Date (as defined in
Paragraph 1(d) hereof, or as adjusted as hereinafter provided and ending on the
last day of the Lease Term, unless sooner terminated as herein provided.
Should Tenant occupy the Premises prior to the Commencement Date specified in
Paragraph 1(d), the Commencement Date shall be altered to coincide with the
date of said occupancy, with the ending date of the Lease remaining unchanged;
provided, however, Basic Rental shall remain unchanged. By occupying the
Premises, Tenant shall be deemed to have accepted the same as suitable for the
purpose herein intended and to have acknowledged that the same comply fully
with Landlord's covenants and obligations hereunder. Notwithstanding anything
in this Lease to the contrary. Tenant's acceptance of the Premises will not
constitute a waiver of any latent defects in the Premises.

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<PAGE> 2
The exact amount of rentable square feet in the Premises shall
be determined by the parties within 60 days of the Commencement Date. The
calculation of rentable space shall be done in accordance with the American
National Standard of the Building Owners and Managers Association International
as set forth in the Standard Method for Measuring Floor Area in Office
Buildings. ANSI 265.1-1980 (the "BOMA Standard)". The Building of which the
Premises are a part currently contains approximately 302,747 rentable square
feet calculated in accordance with the BOMA Standard whereby Tenant's
proportionate share is 1.9944% of the building. This percentage shall be
utilized in calculation of Tenant's pro rata share of excess operating expenses
described in paragraph 4 of this Lease. In the event the recalculation of
rentable square feet in the Premises discloses that the Premises does not
contain exactly 6.038 rentable square feet, the parties shall execute a written
amendment to this lease to change the number of rentable square feet in the
Premises, Tenant's revised proportionate share, and the calculation and amount
of rent payable hereunder (including a reconciliation as to rent already paid).
In the event of any change in the Building, any resulting adjustment in the
amount of rentable square feet in the Building shall not affect the
calculations of rent prior to the change.

3. RENT. In consideration of this Lease, Tenant promises and
agrees to pay Landlord the Basic Rental (as defined in paragraph 1(e) hereof)
without deduction or setoff. It is agreed that, notwithstanding anything to
the contrary, the Premises herein are leased for the Basic Rental for the Lease
Term, payable monthly beginning at the time of the making of this Lease. Basic
Rental has been adjusted to reflect that the initial leasehold improvement
costs are being borne by Tenant.

One such Monthly Rental Installment together with the Security Deposit
(as defined in Paragraph 1(g) hereof) shall be payable by Tenant to Landlord
contemporaneously with the execution hereof and a like Monthly Rental
Installment shall be due and payable without demand on or before the first day
of each calendar month during the term hereof beginning July 1, 1992. A
Monthly Rental Installment for any fractional month at the beginning or the end
of the Lease Term shall be prorated by multiplying said Monthly Rental
Installment times a fraction, the numerator of which is the number of days in
said fraction month which fall within the Lease Term and the denominator of
which is the total number of days in such calendar month.

If the Monthly Rental Installment is not received by the Landlord
within ten (10) days of the date said Monthly Rental Installment is due, a
service charge of 1% of the Monthly Rental Installment owed shall become due
and payable in addition to the Monthly Rental Installment owed. Said service
charge is for the purpose of reimbursing Landlord for the extra costs and
expenses incurred in connection with the handling and processing of late
Monthly Rental Installment payments. All sums of money which are or which
become owed to Landlord pursuant to any of the terms, covenants and conditions
of this Lease, whether or not so specified, shall be deemed "rent" or
"additional rent" and, if not timely paid, shall be subject to the 1% service
charge specified herein. Additionally, any Monthly Rental Installment not paid
within twenty (20) days of the due date thereof shall, in addition to the 1%
service charge specified herein, bear interest at the maximum lawful rate from
the due date until paid.

4. EXPENSE ESCALATION. In the event the operating expenses (as
defined below) of Landlord for the building of which the Premises are a part
shall, in any calendar year during the term of this Lease, exceed the sum of
the actual operating expenses for 1992 per square foot grossed up to reflect a
95% occupancy, Tenant agrees to pay as additional rental Tenant's pro rata
share of such excess operating expenses. Landlord shall, within nine months
following the close of any calendar year for which additional rental is due
under this paragraph, invoice Tenant for the additional rental. The invoice
shall include in reasonable detail all computations of the additional rental,
and Tenant agrees to pay the additional rental within thirty days following
receipt of the invoice. If this Lease shall terminate on a day other than the
last day of a year, the amount of any additional rental payable by Tenant
applicable to the year in which such termination shall occur shall be prorated
on the ratio that the number of days from the commencement of such year to and
including such termination date bears to 365. If at any time during the term
of this Lease, Landlord has reason to believe the per square foot operating
expenses for the calendar year will exceed the sum set forth above, Landlord
may invoice Tenant to prepay monthly one-twelfth of an amount equal to the
additional rental paid in the previous year. If the invoice delivered within
nine months following the close of a calendar year in accordance with this
paragraph shows an amount owing by Tenant that is less than the sum of the
monthly payments made by Tenant in the previous calendar year, the invoice
shall be

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<PAGE> 3
accompanied by a refund of the excess by Landlord to Tenant. If such invoice
shows an amount owing by Tenant which is more than the sum of the monthly
payments made by Tenant in the previous calendar year, Tenant shall pay such
deficiency to Landlord within thirty days after receipt of the invoice. During
the year in which this Lease terminates, Landlord shall have the option to
invoice Tenant for Tenant's pro rata share of the excess operating expenses
based upon the previous year's excess operating expenses. Landlord shall
invoice Tenant under this option within thirty days prior to the termination of
this Lease. Tenant shall have the right, at its own expense and at a
reasonable time, to audit Landlord's books relevant to the additional rentals
due under this paragraph.

The term "Operating Expenses" as used above includes all reasonable
expenses incurred with respect to the maintenance and operation of the building
of which the leased premises are a part, including, but not limited to,
maintenance and repair costs, electricity, fuel, water, sewer, gas and other
utility charges, security, window washing, janitorial services, trash and snow
removal, landscaping and pest control, management fees (not to exceed 4.5%),
wages and fringe benefits payable to employees of Landlord whose duties are
connected with the operation and maintenance of the Building and/or Premises,
amounts paid to contractors or subcontractors for work or services performed in
connection with the operation and maintenance of the Building and/or Premises,
all services, supplies, repairs, replacements or other expenses for maintaining
and operating the Building and/or Premises, including common area, parking
area, recreation area and plaza area maintenance. The term "Operating
Expenses" also includes all real property taxes and installments of special
assessments, including special assessments due to deed restrictions and/or
owners' associations, which accrue against the Building of which the Premises
are a part during the term of this Lease as well as all insurance premiums
Landlord is required to pay or deems necessary to pay, including public
liability insurance, with respect to the Building and/or Premises. The term
"Operating Expenses" does not include any capital improvement to the Building,
nor shall it include repairs, restoration or other work occasioned by fire,
windstorm or other casualty, income and franchise taxes of Landlord, expenses
incurred in leasing to or procuring of Tenants, leasing commissions,
advertising expenses, expenses for the renovating of space for new Tenants,
interest or principal payments on any mortgage or other indebtedness of
Landlord or any depreciation allowance. Operating Expenses shall be deemed,
for purposes of this Lease, not to include any of the following: (i) costs of
a type for which Tenant is required to pay itself directly or to provide
reimbursement under other provisions of this Lease (i.e., there shall be no
double counting), (ii) costs paid by insurance or by other parties (other than
payment by other tenants pursuant to provisions in their leases comparable to
those contained herein), (iii) debt service or ground lease payments, (iv)
costs incurred to lease or otherwise transfer any interest in the Building or
the adjacent land or any portion thereof, (v) expenditures for improvements to
the Building which should be capitalized according to generally accepted
accounting principles, (vi) costs incurred for the benefit of or because of a
dispute with a particular tenant or prospective tenant (in contrast to costs
incurred for the benefit of the tenant in the Building generally), (vii) costs
resulting from any breach or claimed breach by Landlord of its contractual
obligations to other parties, (viii) costs of correcting violations of
applicable laws resulting from actions of Landlord or anyone claiming by,
through or under Landlord (other than Tenant), or correcting construction
defects or deficiencies affecting the Building, (ix) depreciation and other
noncash expenses, (x) overhead or administrative costs of Landlord or any other
factor added to cover overhead and administrative costs or to provide Landlord
or any of its partners or affiliates an additional profit, or (xi) costs of
bringing the Building into compliance with the Americans with Disabilities Act.

5. SERVICES.

(a) During the Building Operating Hours (8:00 a.m. - 6:00
p.m. on Mondays through Fridays and 8:30 a.m. - 1:00 p.m. on Saturdays
[excepting Building Holidays]) Landlord shall furnish to Tenant
heating and air conditioning at such temperatures and in such amounts
as are reasonably considered to be standard unless otherwise required
by governmental regulation. Any usage by Tenant of heating or air
conditioning other than during Building Operating Hours, if permitted
by Landlord, shall be paid for by Tenant, as additional rental, upon
receipt by Tenant of a statement therefor from Landlord, at rates set
by Landlord from time to time. The after hours heating and air
conditioning charge in 1992 is $50.00 per hour. Landlord shall only
have the right to increase such charge based upon any increased
utility costs of Landlord.

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(b) Landlord shall further furnish to Tenant the
following:

(i) Hot and cold water, for normal office use
only, at those points of supply provided for
the general use of Tenants; and

(ii) Janitorial service on Mondays through Fridays
(building Holidays excepted), provided,
however, if Tenant's floor covering or other
improvements require special treatment,
Tenant shall pay the additional cleaning cost
attributable thereto, as additional rental,
upon presentation of a statement therefor;

(iii) Elevator service seven days a week.

(c) Landlord shall furnish electrical power to the
Premises through the existing feeders and electrical distribution
facilities servicing the Building. Landlord shall not bear the
utility costs (including meter installation and air conditioning
costs) occasioned by electrodata processing machines, computers and
similar machines of high electrical consumption. In the event that
Tenant's electrical requirements exceed the capacities available in
the Building, then all costs associated with increasing such
capacities in order to satisfy Tenant's electrical requirements shall
be borne by Tenant. Landlord shall provide replacement of fluorescent
light bulbs, tubes and ballasts in the Premises and fluorescent and
incandescent bulbs in the common areas. Tenant shall advise Landlord
of the equipment to be installed by Tenant in the Premises prior to
the commencement of this Lease and Landlord acknowledges and agrees
that such equipment shall not be considered equipment of high
electrical consumption so as to require Tenant to pay the utility
costs there for, so long as such equipment does not require electrical
capacity greater than that amount used by desktop personal computers
or other office equipment and/or appliances considered to be standard
use by other tenants in the building.

(d) Landlord shall provide security, in such form as
Landlord deems appropriate, in the form of limited access to the
Building during other than Building Operating Hours. Landlord shall
have no liability to Tenant, its employees, agents, invitees or
licensees for losses due to theft or burglary, or for damage done by
unauthorized persons on the Premises and shall not be required to
insure against any such losses. Tenant shall cooperate fully with
Landlord in Landlord's efforts to maintain security in the Building
and shall follow all regulations promulgated by Landlord with respect
thereto.

(e) Landlord does not warrant that any of said specified
services will be free from interruption or stoppage, but nevertheless
Landlord shall use reasonable diligence to resume any such interrupted
or stopped service. Anything to the contrary notwithstanding, neither
failure, to any extent, to furnish such services nor any stoppage or
interruption of these fined services shall render Landlord liable in
any respect for damages to either person, property or business, nor
shall any such failure, interruption or stoppage of such services be
deemed or construed as an eviction, actual or constructive, of Tenant,
nor work an abatement of rent nor relieve Tenant from the obligation
to fulfill any covenant or agreement contained in this Lease. Should
any of the equipment or machinery used in the provision of any of said
specified services for any cause cease to function properly, Tenant
shall have no claim for offset or abatement of rent or damages on
account of an interruption in service resulting therefrom and Landlord
shall not be liable therefor, except to the extent of gross negligence
or willful misconduct. Notwithstanding anything in this Lease to the
contrary, the failure by Landlord to furnish water, electricity,
heating, air conditioning or elevator service or the interruption or
the termination of any of such services shall, if the same continues
for more than three (3) consecutive days and materially affects
Tenants ability to conduct normal business operations in the premises,
give rise to any equitable abatement of rent during the continuance of
such failure, interruption or termination; and if such failure,
interruption or termination continues for more than thirty (30) days,
Tenant shall have the right to terminate this Lease.

6. LEASEHOLD IMPROVEMENTS. If construction to the Premises is to
be performed by Landlord prior to Tenant's occupancy, Landlord shall construct
and install in the

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Premises such Leasehold Improvements (herein so called) as are desired by
Tenant, subject to Landlord's prior written approval. Such Leasehold
Improvements shall be constructed and installed pursuant to plans and
specifications which are prepared by Landlord's representative in accordance
with Tenant's design criteria. Tenant agrees to cooperate fully with Landlord
or Landlord's representative in the design, construction and installation of
the Leasehold Improvements, so that Landlord shall have a reasonable period of
time to design, construct and install the Leasehold Improvements prior to the
Commencement Date. Such plans and specifications, together with the agreed
upon cost of constructing and installing the Leasehold Improvements depicted
therein shall be timely approved by Landlord and Tenant in writing, and when so
approved shall be deemed incorporated into this Lease by this reference
thereto. All costs and expenses of constructing and installing the Leasehold
Improvements to meet Tenant's specifications shall be paid by Tenant to
Landlord upon the substantial completion of such construction and upon receipt
of a statement from Landlord. The Commencement Date of this Lease shall not be
adjusted or delayed by virtue of the failure of Tenant to agree upon the final
plans and specifications for the construction of such Leasehold Improvements
nor by virtue of any delay caused by Tenant during the course of construction
or other failure, for whatever reason, of the Leasehold Improvements to be
fully completed prior to the Commencement Date. Tenant acknowledges that
Landlord has made no representations or promises as to the final cost of any
Leasehold Improvements to the Premises, and that no such costs can or will be
agreed upon between Landlord and Tenant until the final plans and
specifications have been approved by each. Tenant further acknowledges that
Landlord has made no representations or promises with respect to the time
needed to install and construct the Leasehold Improvements, and that any such
time periods suggested by Landlord or its representatives are only estimates
and shall not be binding on Landlord. The failure by Tenant to timely approve
final plans and specifications for Leasehold Improvements, the length of time
taken to construct and install the Leasehold Improvements, or the cost of
constructing and installing any such Leasehold Improvements, shall not
constitute grounds upon which Tenant may claim that this Lease is void,
voidable or otherwise not in full force and effect, any such claim being hereby
expressly waived by Tenant, and Tenant further agrees that such failure to
timely approve the plans and specifications, length of time or cost of
constructing and installation of the Leasehold Improvements shall not modify or
defer the Commencement Date or the payment of Rent hereunder. Upon the
expiration of the Lease Term, all Leasehold Improvements shall become the
property of the Landlord.

7. SIGNS.

If the Premises are within a multi-story building, Landlord
will furnish and install a suitable building directory and establish
suite numbers to facilitate locating and identifying the Premises. In
order to effect uniformity, to control the graphics, and to maintain
dignified aesthetics, Landlord will also furnish and install at the
entrance door to the Premises a uniform suite number plate and a name
plate. Signs, name plates or graphics which are wholly within the
Premises and not visible from the exterior of the building or from
public spaces within the building will be permitted.

Tenant agrees that no other sign (mobile or stationary) of any
description (other than signage in Tenant's reception area)shall be
erected, placed or painted in or about the Premises.

8. USE. Tenant shall use the Premises only for the Permitted Use
(as defined in Paragraph 1 (h) hereof). Tenant will not occupy or use the
Premises, or permit any portion of the Premises to be occupied or used for any
business or purpose other than the Permitted Use or for any use or purpose
which is unlawful in part or in whole or which violates any rule, regulation or
ordinance of any applicable governmental authority or deemed to be disreputable
in any manner or extrahazardous on account of fire, nor permit anything to be
done which will in any way increase the rate of fire insurance on the Building
or its contents. In the event that, by reason of acts of Tenant, there shall
be any increase in the rate of insurance on the Building or its contents or
which create additional cost or expense to Landlord because of Tenant's acts or
conduct of business, Tenant hereby agrees to pay to Landlord the amount of such
increase on demand and acceptance of such payment shall not constitute a waiver
of any of Landlord's other rights provided herein. Tenant will conduct its
business and control its agents, employees and invitees, in such a manner as
not to create any nuisance, nor interfere with, annoy or disturb other Tenants
or Landlord in its management of the Building. Tenant will maintain the
Premises

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<PAGE> 6
in a clean, healthful and safe condition and will comply with all laws,
ordinance, orders, rules and regulations (state, federal, municipal and other
agencies or bodies having any jurisdiction thereof) with reference to the use,
condition or occupancy of the Premises. Tenant shall not install any vending
machines or cooking apparatus (with the exception of coffee makers and
microwave ovens) in the Premises nor shall it sell, purchase or give away (or
permit anyone else to sell, purchase, or give away) within the Premises any
food, cigars, cigarettes, tobacco, sundries, refreshments, office supplies,
commercial photocopying services or similar items. Tenant will not, without
the prior written consent of Landlord, paint, install lighting, window
coverings or decorations, or install any signs, window or door lettering or
advertising media of any type on or about the Premises or any part thereof.
Tenant shall not, without Landlord's prior written consent, place any safes, or
other inordinately heavy objects in the Premises or the Building or in any
manner exceed the floor loading design for the Building as determined by
Landlord in its sole discretion. Should Landlord agree in writing to any
agents of the foregoing items in the preceding sentences, Tenant will maintain
such permitted items in good condition and repair at all times.
Notwithstanding anything in this Lease to the contrary, in no event shall
Tenant be responsible for compliance with laws, ordinances, rules and
regulations that require structural or other changes to the Premises or the
Building unless due to the particular use or manner of occupancy by Tenant.
Further, Tenant shall be obligated to remove only those hazardous substances or
wastes or solid wastes that are deposited on or in the Premises by Tenant or
its agents, employees, or licensees and all other hazardous substances or
wastes or solid wastes shall be removed by Landlord at its expense.

During the Lease Term, Tenant and its employees, guests, agents,
visitors and invitees shall have the nonexclusive use in common with Landlord,
other Tenants of the Building, their employees, guests, agents, visitors and
invitees, of the non-reserved common automobile parking areas, driveways, and
footways, subject to rules and regulations for the use thereof as prescribed
from time to time by Landlord. Landlord shall have the right to reserve
parking spaces as it elects and condition use thereof on such terms as it
elects.

9. REPAIRS AND MAINTENANCE.

(a) By Landlord: Landlord shall at its expense maintain
the roof, foundation, and the structural soundness of the exterior
walls except for reasonable wear and tear. Tenant shall give
immediate written notice to Landlord of the need for repairs or
corrections and, if Landlord shall deem it appropriate, Landlord shall
proceed promptly to make such repairs or corrections. Landlord's
liability hereunder shall be limited to the cost of such repairs or
corrections. Landlord shall maintain in good order, condition and
repair in accordance with applicable laws the Building systems and
exterior landscaping, parking areas, ground floor lobbies and other
common areas.

(b) By Tenant: Tenant shall, at its expense and risk,
maintain the Premises in good repair and condition, including but not
limited to repairs (including all necessary replacements) to plate
glass doors and the interior of the Premises in general. Tenant will
not in any manner deface or injure the Building, the Premises or
related facilities and will pay the cost of repairing any damage or
injury done by Tenant or Tenant's agents, employees or invitees.
Tenant shall throughout the Lease Term take good care of the Building,
the Premises and related facilities and keep them free from waste and
nuisance of any kind. If Tenant shall fail to make any repairs
required hereunder (including all necessary replacements) within
fifteen (15) days after written notification to do so, Landlord may,
at its option, make such repair, and the cost thereof shall be
additional rental immediately due hereunder by Tenant to Landlord.

10. ALTERATIONS AND IMPROVEMENTS. At the end or other termination
of this Lease, Tenant shall deliver possession of the Premises to Landlord with
all improvements located therein, (except as otherwise herein provided) in good
repair and condition, reasonable wear and tear excepted, and shall deliver to
Landlord all keys to the Premises. The cost and expense of any repairs
necessary to restore the condition of the Premises to said condition in which
they are to be delivered to Landlord shall be borne by Tenant. Tenant will not
make or allow to be made any alterations or physical additions in or to the
Premises without the prior written consent of Landlord, which consent shall not
be unreasonably withheld as to nonstructural alterations. In making any such
alterations, additions or improvements, Tenant shall utilize only such
contractors and subcontractors which have been approved, in writing, by

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<PAGE> 7
Landlord. All alterations, additions or improvements (whether temporary or
permanent in character) made in or upon the Premises, either by Landlord or
Tenant, shall, at Landlord's option be Landlord's property on termination of
this Lease and shall remain on the Premises without compensation to Tenant or,
if required by Landlord, shall be removed by Tenant, at Tenant's sole cost and
expense, upon termination of the Lease. All furniture, movable trade fixtures
and equipment installed by Tenant may be removed by Tenant, at Tenant's sole
cost and expense, at the termination of this Lease provided Tenant is not then
in default, and shall be so removed if required by Landlord, or if not so
removed shall, at the option of Landlord, become the property of Landlord or
shall be removed by Landlord at Tenant's sole cost and expense. All such
installations, removals and restoration shall be accomplished in a good and
workmanlike manner so as not to damage the Premises or the primary structure or
structural qualities of the Building or the plumbing, electrical lines or other
utilities of the Building.

11. ASSIGNMENT AND SUBLETTING. In the event Tenant desires to
assign or sublet the Premises or any part thereof, Tenant shall give Landlord
written notice of such desire at least ten (10) days prior to the date on which
Tenant desires to make such assignment or sublease. Landlord shall within five
(5) days following receipt of such notice notify Tenant in writing that
Landlord elects either (i) to permit or (ii) not to permit Tenant to assign or
sublet such space, subject, however, to subsequent written approval of the
proposed assignee or sublessee by Landlord and written approval of all
documents which will evidence or relate to such subleasing or assignment such
permission not to be unreasonably withheld or delayed. Notwithstanding
anything in this Lease to the contrary, Tenant may, without the prior written
consent of Landlord, but only after giving Landlord at least ten (10) days
prior written notice, sublet the Premises or any part thereof to an Affiliate
(hereinafter defined) or permit occupancy of any portion of the Premises by an
Affiliate. The term "Affiliate" shall mean (i) any corporation which, directly
or indirectly, controls or is controlled by Tenant or is under common control
with a general partner of Tenant, (ii) any corporation not less than fifty
percent (50%) of whose outstanding stock shall, at the time be owned directly
or indirectly by a general partner of Tenant or (iii) any partnership or joint
venture in which Tenant or a general partner of Tenant is a general partner or
joint venturer (with joint and several liability for all of the partnership's
or venture's obligations). If Landlord should fail to notify Tenant in
writing, of such election within said five (5) day period, Landlord shall be
deemed to have elected (i) above, but subsequent written approval by Landlord
of the proposed assignee or sublessee shall be required, unless not received
within the ten (10) day period. Consent by Landlord to one or more assignments
or sublettings shall not operate as a waiver of Landlord's rights as to any
subsequent assignments and sublettings. Notwithstanding any assignment or
subletting, Tenant, and any guarantor of Tenant's obligations under this Lease,
shall at all times remain fully responsible and liable for the payment of the
rent herein specified and for compliance with all of Tenant's other obligations
under this Lease unless otherwise agreed in writing. In the event of the
transfer and assignment by Landlord of its interest in this Lease and the
Building, Landlord shall thereby be released from any further obligations
hereunder if, and only if, Landlord's successor assumes all existing
obligations under the Lease, and Tenant agrees to look solely to such successor
in interest of the Landlord for performance of such obligations. Tenant shall
not mortgage, pledge or otherwise encumber its interest in this Lease or in the
Premises.

12. INDEMNIFY. Landlord shall not be liable for and Tenant will
indemnify and hold Landlord harmless of and from all fines, suits, claims,
demands, losses and actions (including attorneys' fees) for any injury to
person or damage to or loss of property on or about this Premises caused by the
negligence or misconduct or breach of this Lease by Tenant, its agents,
employees, subtenants, invitees or by any other person entering the Building,
the Premises, or related facilities under the express or implied invitation of
Tenant, or arising out of Tenant's use of the Building, the Premises, or
related facilities. Landlord shall not be liable or responsible for any loss
or damage to any property or death or injury to any person occasioned by theft,
fire, Act of God, public enemy, injunction, riot, strike, insurrection, war,
court order, requisition of any governmental body or authority, by other
Tenants of the Building or related facilities or any other matter beyond the
control of Landlord, or for any injury or damage or inconvenience which may
arise through repair or alteration of any part of the Building, the Premises or
related facilities, or failure to make repairs or from any cause whatsoever
except Landlord's gross negligence. Notwithstanding anything in this Lease to
the contrary, Tenant shall not be liable for the acts or omissions of
"invitees" other than Persons within the Premises at the invitation of Tenant.
The exculpation of Landlord's liability and the indemnification of Landlord by
Tenant as set forth in Paragraph 12 of this Lease shall not be applicable in
cases

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where such damage or injury is caused by or attributable to the negligence or
willful misconduct of Landlord. Further, in no event shall Tenant indemnify
Landlord form any loss, expense or claims arising out of damage or injury
occurring in or about an area other than the Premises unless such damage or
injury is caused by Tenant or its employees, agents or subtenants.

Landlord shall indemnify and hold Tenant harmless from all fines,
suits, cost and liability of every kind arising because of: (i) any violation
or nonperformance by Landlord of any representation or covenant contained in
this Lease which continues beyond any applicable cure period; (ii) any bodily
injury, death and/or damage to property (excluding damage to Tenant's personal
property within the Building) occurring in or resulting from any occurrence in
the common areas of the Building during the term of this Lease; and (iii) any
bodily injury, death and/or property damage that is proximately caused by the
negligence or willful misconduct of Landlord or any of its agents, employees or
contractors. The indemnity set out in the preceding sentence will not apply to
matters caused in whole or in part by negligence on the part of Tenant or
anyone acting for Tenant.

13. MORTGAGES AND GROUND LEASES. This lease shall be subject and
subordinate at all times to ground or underlying leases which now exist or may
hereafter be executed, modified or extended, affecting the Building or the land
upon which the Building is situated or both, and to the lien of any mortgages
or deeds of trust in any amount or amounts whatsoever now or hereafter placed
on or against the land and Building or either thereof, or on or against
Landlord's interest or estate therein, or on or against any ground or
underlying leases without the necessity of the execution and delivery of any
further instruments on the part of Tenant to effectuate such subordination.
Notwithstanding the foregoing, Tenant covenants and agrees to execute and
deliver, upon demand, such further instruments evidencing such subordination of
the Lease to such ground or underlying leases and to the lien of any such
mortgages or deeds of trust as may be required by Landlord. Landlord is hereby
irrevocably appointed and authorized as agent and attorney-in-fact of Tenant,
which appointment shall be deemed a power coupled with an interest, to execute
and deliver all such subordination instruments in the event Tenant fails to
execute and deliver same within five (5) days after notice from Landlord
requesting the execution thereof. Tenant shall, upon request by Landlord from
time to time made, execute and deliver instruments stating and certifying that
this Lease is in full force and effect and unmodified (or if modified stating
the nature of such modification), the date through which the rental has been
paid, the termination date of this Lease, that no defaults exist under this
Lease and the Tenant has no claims or offsets against Landlord.

13.a. NONDISTURBANCE AGREEMENT. Notwithstanding anything in this
Lease to the contrary, this Lease shall not be subject or subordinate to any
mortgage or deed of trust lien which hereafter encumbers the Premises unless
Landlord obtains a nondisturbance agreement from the holder of such mortgage or
deed of trust, wherein such holder agrees not to disturb Tenant's Possession of
the Premises (subject to the terms, conditions and provisions of this Lease) so
long as Tenant is not in default or breach of this Lease. Further, within
thirty (30) days after the complete execution of this Lease Landlord shall use
best efforts to obtain a similar nondisturbance agreement from the holder of am
current mortgage or deed of trust which encumbers the Premises by requesting
such agreement from the current mortgage holder.

14. INSURANCE. During the Lease Term, Landlord shall maintain a
policy or policies of insurance issued by and binding upon some solvent
insurance company, to insure the Building against loss or damage by fire,
explosion, or other hazards and contingencies in such amounts as Landlord may
determine in the exercise of its discretion provided that Landlord shall not be
obligated to insure any furniture, equipment, machinery, goods or supplies not
covered by this Lease which Tenant may bring or place upon the premises, or any
additional improvements which Tenant may construct thereon. Such insurance
shall be maintained at the expense of Landlord (as part of the operating
expenses defined in this Lease) and payments for losses thereunder shall be
made solely to Landlord or to others having an interest in the Building, as
their interest shall appear. If the annual premiums to be paid by Landlord
shall exceed the standard rates because of Tenant's operations, contents of the
Premises, or improvements with respect to the Premises beyond building
standard, or results in extrahazardous exposure, Tenant shall promptly pay the
excess amount of the premium upon request by Landlord. Tenant shall maintain
at all times and at its own expense, in an amount equal to full replacement
cost, fire and extended coverage insurance on all of its personal property,
including removable trade fixtures located in the Premises, together with
liability

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insurance in an amount of not less than $1,000,000 for any one occurrence in
form acceptable to Landlord and with insurers licensed to issue such insurance
coverage in the State of Texas which policy of liability insurance shall extend
to include Landlord as an additional named insured. Tenant shall, upon
request, provide Landlord with a certificate of insurance as written evidence
of the insurance in force and Tenant shall obtain the agreement of Tenant's
insurance in force and Tenant shall obtain the agreement of Tenant's insurers
to notify Landlord that a policy is due to expire at least ten (10) days prior
to such expiration.

15. INSPECTION. Landlord or its representatives shall have the
right to enter into and upon any and all parts of the Premises at reasonable
hours to (i) inspect same or clean or make repairs or alternations or additions
as Landlord may deem necessary (but without any obligation to do so, except as
expressly provided for herein), or (ii) show the Premises to prospective
Tenants anytime after 120 days prior to expiration, purchasers or lenders, and
Tenant shall not be entitled to any abatement or reduction of rent by reason
thereof, nor shall such be deemed to be an actual or constructive eviction.
Landlord shall provide Tenant with reasonable notice of any entry by Landlord
(except in the case of an emergency); and Landlord shall not unreasonably
interfere with Tenant or the operation of Tenant's business (except in the
event of an emergency) by reason of any such entry.

16. CONDEMNATION. If, during the term of this Lease, or any
extension or renewal thereof, all of the Premises or the Building should be
taken for any public or quasi-public use under any governmental law, ordinance,
regulation or by right of eminent domain or by private purchase in lieu
thereof, this Lease shall terminate and the rent shall be abated during the
unexpired portion of this Lease, effective on the date physical possession is
taken by the condemning authority, and Tenant shall have no claim against
Landlord for the value of any unexpired term of this Lease.

In the event a portion but not all of the Premises or the Building
(whether or not the Premises are affected) shall be taken for any public or
quasi-public use under any governmental law, ordinance or regulation, or by
right or eminent domain or by private sale in lieu thereof, then Landlord shall
have the option, in its reasonable discretion, of terminating this Lease, or,
at Landlord's sole risk and expense, if the Premises are affected, of restoring
and reconstructing the Premises to the extent necessary to make same reasonably
tenantable. Should Landlord elect to restore, the Lease shall continue in full
force and effect with the rent payable during the unexpired portion of this
Lease adjusted to such an extent as may be fair and reasonable under the
circumstances, and Tenant shall have no claim against Landlord for the value of
any interrupted portion of this Lease.

In the event of any condemnation or taking, total or partial, Tenant
shall not be entitled to any part of the award or price paid therefor, and
Landlord shall receive the full amount of such award or price, Tenant hereby
expressly waiving any right or claim to any part thereof.

17. FIRE OR OTHER CASUALTY. In the event that the Premises should
be totally destroyed by fire, tornado or other casualty or in the event the
Premises or the Building should be so damaged that rebuilding or repairs cannot
be completed within ninety (90) days after the date of such damage, either
Landlord or Tenant may at its option terminate this Lease, in which event the
rent shall be abated during the unexpired portion of this Lease effective with
the date of such damage. In the event the Premises should be damaged by fire,
tornado or other casualty, but only to such extent that rebuilding or repairs
can be completed within ninety (90) days after the date of such damage, or if
the damage should be more serious but neither Landlord nor Tenant elects to
terminate this Lease, in either such event Landlord shall within, thirty (30)
days after the date of such damage, commence to rebuild or repair the Premises
and shall proceed with reasonable diligence to restore the Premises to
substantially the same condition in which they were immediately prior to the
happening of the casualty, except that Landlord shall not be required to
rebuild, repair or replace any part of the furniture, equipment, fixtures and
other improvements which may have been placed by Tenant or other Tenants within
the Building or the Premises, or related facilities. In the event that the
Premises are totally untenantable, Landlord shall abate the rent during the
time the Premises are unfit for occupancy. If the Premises are not totally
untenantable, Landlord shall allow Tenant a fair diminution of rent during the
time the Premises are partially unfit for occupancy. Any insurance which may
be carried by Landlord or Tenant against loss or damage to the Building or to
the Premises shall be for the sole benefit of the party carrying such insurance
and under its sole control.

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<PAGE> 10
18. HOLDING OVER. Should Tenant or any of its successors in
interest hold over the premises, or any part thereof, after the expiration of
the term of this Lease, unless otherwise agreed in writing, such holding over
shall constitute and be construed as a tenancy at will only at a daily rental
equal to (i) one-thirtieth of the sum of, the Monthly Rental Installment,
together with the most current rental adjustment which may have been made
thereto pursuant to Paragraph 4 hereof, plus (ii) twenty-five percent (25%) of
such amount. The inclusion of the preceding sentence shall not be construed as
Landlord's consent for the Tenant to hold over.

19. TAXES ON TENANT'S PROPERTY. Tenant shall be liable for all
taxes levied or assessed against personal property, furniture or fixtures
placed by Tenant in the Premises. If any such taxes for which Tenant is liable
are levied or assessed against Landlord or Landlord's property and if Landlord
elects to pay the same or if the assessed value of Landlord's property is
increased by inclusion of personal property, furniture or fixtures placed by
Tenant in the Premises, and Landlord elects to pay the taxes based on such
increase, Tenant shall pay to Landlord upon demand that part of such taxes for
which Tenant is primarily liable hereunder.

20. EVENTS OF DEFAULT. The following events shall be deemed to be
events of default by Tenant under this Lease:

(a) Tenant shall fail to pay any Monthly Rental
Installment, any portion of the Basic Rental hereby reserved or any
other rental or additional rental when due and such failure shall
continue for a period of ten (10) days after written notice thereof to
Tenant;

(b) Tenant shall fail to comply with any term, provision,
or covenant of this Lease, other than the payment of rent, and shall
not cure such failure within thirty (30) days after written notice
thereof to Tenant or if such failure is not reasonably susceptible of
being cured within thirty (30) days, Tenant shall fail to commence the
curing thereof within thirty (30) days after Landlord gives written
notice to Tenant thereof, or having commenced the curing thereof,
Tenant shall fail to diligently pursue the curing of such default to
completion;

(d) Tenant shall file a petition under any section or
chapter of the Federal Bankruptcy Code, as amended, or under any
similar law or statute of the United States or any State thereof, or
Tenant shall be adjudged bankrupt or insolvent in any proceeding filed
against Tenant thereunder and such adjudication shall not be vacated
or set aside within thirty (30) days;

(e) A receiver, trustee or liquidator shall be appointed
for all or substantially all of the assets of Tenant and such
receivership shall not be terminated or stayed within thirty (30)
days; or

21. REMEDIES. Upon the occurrence of any event of default
specified in Paragraph 20 hereof, Landlord shall have the option to pursue any
one or more of the following remedies without "ny notice or demand whatsoever:

(a) Terminate this Lease in which event Tenant shall
immediately surrender the Premises to Landlord, and if Tenant fails to
do so, Landlord may, without prejudice to any other remedy which it
may have for possession or arrearages in rent, enter upon and take
possession and expel or remove Tenant and any other person who may be
occupying said Premises or any part thereof, without being liable for
prosecution or any claim for damages relating thereto. Tenant agrees
to pay to Landlord on demand the amount of all loss and damage which
Landlord may suffer by reason of such termination, whether through
inability to relet the Premises on satisfactory terms or otherwise,
including the loss of the Basic Rental then remaining unpaid;

(b) Enter upon and take possession of the Premises and
expel or remove Tenant and any other person who may be occupying the
Premises or any part thereof without being liable for prosecution or
any claim for damages therefor, and if Landlord so elects, relet the
Premises on such terms as Landlord shall deem advisable and receive

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<PAGE> 11
the rent therefor. Tenant agrees to pay to Landlord on demand any
deficiency in Basic Rental that may arise by reason of such reletting,
and

(c) Enter upon the Premises without being liable for
prosecution or any claim for damages therefor, and do whatever Tenant
is obligated to do under the terms of this lease, and Tenant agrees to
reimburse Landlord on demand for any expenses which Landlord may incur
in thus effecting compliance with Tenant's obligations under this
lease, and Tenant further agrees that Landlord shall not be liable for
any damages resulting to the Tenant from such action.

No reentry or taking possession of the Premises by Landlord shall be
construed as an election on its part to terminate this Lease, unless a written
notice of such intention be given to Tenant. Notwithstanding any such
reletting or re-entry or taking possession, Landlord may at any time thereafter
elect to terminate this lease for previous uncured default. Pursuit of any of
the foregoing remedies shall not preclude pursuit of any other remedies
otherwise available to Landlord at law or in equity, nor shall pursuit of any
remedy herein provided constitute a forfeiture or waiver of any rent due to
Landlord hereunder or of any damages accruing to Landlord by reason of the
violation of any of the terms, provisions and covenants herein contained.
Landlord's acceptance of rent following an event of default hereunder shall not
be construed as Landlord's waiver of such event of default. No waiver by
Landlord of any violation of breach of any of the terms, provisions, and
covenants herein contained shall be deemed or construed as Landlord's waiver of
any other violation or breach of any of the terms, provisions, and covenants
herein contained. Forbearance by Landlord to enforce one or more or the
remedies herein provided upon an event of default shall not be deemed or
construed to constitute a waiver of any other violation or default. The loss
or damage that Landlord may suffer by reason of termination of this Lease or
the deficiency from any reletting as provided for above shall include the
expense of repossession and any repairs or remodeling undertaken by Landlord
following possession. Should Landlord at any time terminate this lease for any
default, in addition to any other remedy Landlord may have, Landlord may
recover from Tenant all damages Landlord may incur by reason of such default,
including the cost of recovering the Premises and the loss of the Basic Rental
then remaining unpaid.

In the event Landlord shall be in default under this Lease as a result
of its failure to perform one of its obligations hereunder, Tenant shall have
the right, but shall not be obligated, to Perform such obligation on behalf of
Landlord, and Landlord shall reimburse Tenant within thirty (30) days after
demand by Tenant for all expenses incurred by Tenant in performing such
obligation. In the event Landlord shall fail to reimburse Tenant for any such
expenses so incurred and Tenant shall obtain a final judgment in its favor
against Landlord, Tenant shall have the right to set off the amount of such
judgment against any installment of rent payable by Tenant to Landlord (or any
future landlord) under this Lease.

22. SURRENDER OF PREMISES. No act or thing done by the Landlord
or its agents during the Lease Term shall be deemed an acceptance of a
surrender of the Premises, and no agreement to accept a surrender of the
Premises shall be valid unless the same be made in writing and subscribed by
the Landlord.

23. ATTORNEY'S FEES. In the event either party defaults in the
performance of any of the terms of this Lease and the other party employs an
attorney in connection therewith, the defaulting party shall pay the prevailing
party's reasonable attorneys' fees and costs (including court costs).

24. LANDLORD'S LIEN. In addition to the statutory Landlord's
lien, Landlord shall have, at all times, a valid security interest to secure
payment of all rentals and other sums of money becoming due hereunder from
Tenant, and to secure payment of any damages or loss which Landlord may suffer
by reason of the breach by Tenant of any covenant, agreement or condition
contained herein, upon all goods, wares, equipment, fixtures, furniture,
improvements and other personal property of Tenant presently or which may
hereafter be situated in the Premises and all proceeds therefrom and such
property shall not be removed therefrom without the consent of Landlord until
all arrearages in rent as well as any and all other sums of money then due to
Landlord hereunder shall first have been paid and discharged and all the
covenants, agreements and conditions hereof have been fully complied with and
performed by Tenant. Upon the occurrence of an event of default by Tenant,
Landlord may, in addition to any other

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<PAGE> 12
remedies provided herein, enter upon the Premises and take possession of any
and all goods, wares, equipment, fixtures, furniture, improvements and other
personal property of Tenant situated in the Premises, without liability for
trespass or conversion, and sell the same at public or private sale, with or
without having such property at the sale, after giving Tenant reasonable notice
of the time and place of any public sale or of the time after which any private
sale is to be made, at which sale the Landlord or its assigns may purchase
unless otherwise prohibited by law. Unless otherwise provided by law and
without intending to exclude any other manner of giving Tenant reasonable
notice, the requirement of reasonable notice shall be met if such notice is
given in the manner prescribed in this Lease at least five (5) days before the
time of sale. The proceeds from any such disposition, less any and all
expenses connected with the taking of possession, holding and selling of the
property (including reasonable attorneys' fees and other expenses), shall be
applied as a credit against the indebtedness secured by the security interest
granted herein. Any surplus shall be paid to Tenant or as otherwise required
by law and the Tenant shall pay any deficiencies forthwith. Upon request by
Landlord, Tenant agrees to execute and deliver to Landlord UCC-1 financing
statement in form sufficient to perfect the security interest of Landlord in
the aforementioned property and proceeds thereof under the provisions of the
Uniform Commercial Code in force in the State of Texas. The statutory lien for
rent is not hereby waived, the security interest herein granted being in
addition and supplementary thereto. Notwithstanding anything herein contained
to the contrary, Landlord shall neither sell nor withhold from Tenant, Tenant's
business records. Notwithstanding anything in this Lease to the contrary, the
lien granted to Landlord herein and the statutory landlord's lien granted to
Landlord pursuant to the Texas Property Code shall be subject and subordinate
to any and all purchase money security interests in and to any furniture,
fixtures and equipment of Tenant.

25. MECHANIC'S LIEN. Tenant will not permit any mechanic's
lien(s) to be placed upon the Premises or the Building or improvements thereon
during the term hereof caused by or resulting from any work performed,
materials furnished or obligation incurred by or at the request of Tenant, and
in the case of the filing of any such lien Tenant will promptly pay same. If
default in payment thereof shall continue for twenty (20) days after written
notice thereof from Landlord to the Tenant, then Landlord shall have the right
and privilege, at Landlord's option, of paying the same or any portion thereof
without inquiry as to the validity thereof, and any amounts so paid, including
expenses and interest, shall be so much additional rental hereunder due from
Tenant to Landlord and shall be due immediately on rendition of bill therefor.

26. WAIVER OF SUBROGATION. Anything in this Lease to the contrary
notwithstanding, the parties hereto hereby waive any and all rights of
recovery, claim, action or cause of action, against each other, their agents,
officers, and employees, for any loss or damage that may occur to the Premises
hereby demised, or any improvements thereto, or to the Building, any
improvements thereto, or related facilities, by reason of fire, the elements,
or any other cause which could be insured against under the terms of a Texas
standard form fire and extended coverage insurance policy, or which actually is
insured against under the terms of a valid and collectible insurance policy,
regardless of cause or origin, including negligence of the parties hereto,
their agents, officers, and employees.

28. FORCE MAJEURE. Whenever a period of time is herein prescribed
for action to be taken by Landlord, the Landlord shall not be liable or
responsible for, and there shall be excluded from the computation of any such
period of time, any delays due to strikes, riots, Acts of God, shortages of
labor or materials, war, governmental laws, regulations restrictions or any
other causes of any kind whatsoever which are beyond the control of Landlord.
In the event performance by Tenant of any term, condition or covenant in this
Lease is delayed or prevented by any act of God, strike, lockout, shortage of
material or labor, restriction by any governmental authority, civil riot, flood
or any other cause not within the reasonable control of Tenant, the period for
performance as such to term, condition or covenant shall be extended for a
period equal to the period Tenant is so delayed or hindered, except that the
foregoing shall not apply to the payment of any monies due hereunder by Tenant.

29. SEVERABILITY. If any clause or provision of this Lease is
held to be illegal, invalid or unenforceable under present or future laws
effective during the term of this Lease, then and in that event, it is the
intention of the parties hereto that the remainder of this Lease shall not be
affected thereby, and it is also the intention of the parties to this Lease
that in lieu of each clause or provision of this Lease that is held to be
illegal, invalid, or unenforceable,

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<PAGE> 13
there be added as a part of this Lease a clause or provision as similar in
terms to such illegal, invalid or unenforceable clause or provision as may be
possible and still be legal, valid and enforceable.

30. ENTIRE AGREEMENT: AMENDMENTS: BINDING EFFECT. This Lease
contains the entire agreement between the parties and may not be altered,
changed or amended, except by instrument in writing signed by both parties
hereto. No provision of this Lease shall be deemed to have been waived by
Landlord unless such waiver be in writing signed by Landlord and addressed to
Tenant, nor shall any custom or practice which may grow up between the parties
in the administration of the terms hereof be construed to waive or lessen the
right of Landlord to insist upon the performance by Tenant in strict accordance
with the terms hereof. No payment by Tenant or receipt by Landlord of a lesser
amount than the Monthly Rental Installment or additional rental, which may then
be due under this Lease, shall be deemed to be other than on account of the
earliest rent due hereunder, nor shall any statement or endorsement on any
check or in any letter accompanying any check or payment of rent be deemed an
accord and satisfaction, and Landlord may accept such check or payment without
prejudice to Landlord's right to recover the balance of such rent or pursue any
other remedy in this Lease provided. The terms, provisions, covenants and
conditions contained in this Lease shall apply to, inure to the benefit of, and
be binding upon the parties hereto, and upon their respective successors in
interest and legal representatives, except as otherwise herein expressly
provided.

31. QUIET ENJOYMENT. Provided Tenant has performed all of the
terms, covenants, agreements and conditions of this lease, including the
payment of rent, to be performed by Tenant, Tenant shall peaceably and quietly
hold and enjoy the Premises for the term hereof, without hindrance from
Landlord, subject to the terms and conditions of this Lease.

32. RULES AND REGULATIONS. Tenant shall, and Tenant shall cause
Tenant's agents, employees, guests, visitors and invitees to, comply fully with
all requirements of the rules and regulations of the Building and related
facilities which are attached hereto as Exhibit "A" and made a part hereof as
though fully set out herein. Landlord shall at all times have the right to
change such rules and regulations or to promulgate such other rules and
regulations in such reasonable manner as Landlord may deem advisable for the
safety, care, or cleanliness of the Building, the Premises, or related
facilities, and for the preservation of good order therein, all of which rules
and regulations, changes and amendments will be forwarded to Tenant in writing
and shall be carried out and observed by Tenant. Tenant shall further be
responsible for the compliance with such rules and regulations by all
employees, servants, agents, visitors and invitees of Tenant. Notwithstanding
anything in this Lease to the contrary, Tenant shall have no obligation to
comply with any rules and regulations that are inconsistent with the terms,
conditions and provisions of this Lease, or to comply with any rules and
regulations that are uniformly applied and administered to all of the other
tenants of the Building or which materially interfere with the use and
operation of the business by Tenant. Further, Tenant shall be permitted to
operate microwave ovens as well as vending machines for the sale of food and
other items to its employees and guests, provided that such operation is only
incidental to the purpose for which the Premises are leased to Tenant under
this lease. Provisions of this Lease which prohibit Tenant from "permitting"
or "allowing" certain conduct or actions shall not be construed to render
Tenant liable for the actions of other tenants or third parties, except
Tenant's own employees, contractors and invited guests. This Lease shall
control in the event there is any express or implied conflict between this
Lease and the rules and regulations.

33. GENDER. Words of any gender used in this Lease shall be held
and construed to include any other gender, and words in the singular number
shall be held to include the plural, unless the context otherwise requires.

34. Deleted.

35. NOTICES. Each provision of this Lease, or of any applicable
governmental laws, ordinances, regulations and other requirements with
reference to the sending, mailing or delivery of any notice, or with reference
to the making of any payment by Tenant to Landlord, shall be deemed to be
complied with when and if the following steps are taken:

(a) All rent and other payments required to be made by
Tenant to Landlord hereunder shall be payable to Landlord in Dallas
County, Texas, at the address

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<PAGE> 14
hereinbelow set forth, or at such other address as Landlord may
specify from time to time by written notice delivered in accordance
herewith;

(b) Any notice or document required to be delivered
hereunder shall be deemed to be delivered if actually received and
whether or not received when deposited in the United States mail,
postage prepaid, certified or registered mail, return receipt
requested, addressed to the parties hereto at the respective addresses
set out opposite their names below, or at such other address as they
have heretofore specified by written notice delivered in accordance
herewith:

<TABLE>
<S> <C> <C>
Sterling Plaza Ltd., by
LANDLORD:Sterling Projects, Inc., General Partner TENANT: Brigham Oil & Gas, L.P.
8235 Douglas Ave., Suite 800 5949 Sherry Lane, #1616
Dallas, Texas 75225 Dallas, Texas 75225

</TABLE>

36. CAPTIONS. The captions contained in this Lease are for
convenience of reference only, and in no way limit or enlarge the terms and
conditions of this Lease.

37. PLACE OF PERFORMANCE. Tenant shall perform all covenants,
conditions and agreements contained herein, including but not limited to
payment of rent, in Dallas County, Texas. Any suits arising from or relating
to this Lease shall be brought in Dallas County, Texas.

38. PARKING. Landlord and Tenant agree that Landlord shall make
available to Tenant throughout the term of this Lease, and any renewals or
extensions of this Lease, on-site owner controlled covered parking for one auto
per 333 square feet of rentable area with a minimum of 16 spaces, 4 of which
will be reserved and 12 of which shall be unreserved. All parking for the
initial term of the Lease and any expansions thereof shall be at no charge to
Tenant. Any charge for parking during renewal or extension periods shall be
negotiated at that time.

39. RENEWAL OPTION. If, at the end of the primary term of this
Lease, the Tenant is not in default of any of the terms, conditions or
covenants of the Lease, Tenant, but not any assignee or subtenant of Tenant
unless affiliate company or if otherwise agreed to in writing, is hereby
granted an option to renew this Lease for an additional term of 60 months upon
the same terms and conditions contained in this Lease with the following
exceptions:

A. The renewal option term will contain no further renewal
options unless expressly granted by Landlord in writing, and

B. The rental for the renewed term shall be based upon the then
prevailing rental rates for properties of equivalent quality,
size, utility and location, with the length of the lease term
and credit standing of the Tenant to be taken into account,
but in no event shall the rental rate exceed $18.00 per
rentable square foot per year, with an adjusted Base Year for
operating expenses, and a refurbishment allowance of $3.00 per
rentable square foot.

If Tenant desires to renew this Lease, Tenant will notify the Landlord of its
intention to renew no later than six months prior to the expiration date of the
lease. Landlord shall, within the next fifteen days, notify Tenant in writing
of the proposed renewal rate and the Tenant shall, within the next fifteen days
following receipt of the proposed rate, notify the Landlord in writing of its
acceptance or rejection of the proposed rental rate.

40. Deleted.

41. SPECIAL PROVISIONS.

41.1 Landlord and Tenant agree that Tenant shall take occupancy of
the Premises on an "as is" basis, provided, however, that at any time during
the Lease Term, Tenant may request and upon such request, Landlord shall make
the following, improvements at Tenant's expense:

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<PAGE> 15
1. Landlord shall recarpet and repaint throughout per
Tenant's selection, including replacement of existing
grey vinyl wall coverings with paint. Border carpet
installed in reception and conference room.
Grasscloth in two executive offices to be matched or
replaced with similar surface.
2. Landlord shall provide kitchen area complete with hot
and cold tap water, dishwasher, ice maker and
refrigerator.
3. Landlord shall install a new wall and door on the
west end of the space between the two executive
offices creating a new office and relocating both
entry doors to the executive offices.
4. Tenant shall have the right to delete any of these
requests.

41.2 Landlord and Tenant agree that Landlord shall provide, at its
sole expense, full space planning services for all "building standard" work,
including construction drawings and detailed plans and specifications,
reflected ceiling plans, telephone and electrical plans, and finish schedules.

41.3 Notwithstanding anything to the contrary contained in this
Lease, Landlord and Tenant agree that the Lease shall commence upon substantial
completion of the leased premises, unless such substantial completion is
delayed by Tenant beyond the projected commencement date, in which event the
Lease shall commence on the date that substantial completion would have
occurred but for such Tenant delays. Landlord acknowledges that Tenant desires
to occupy the leased premises on or before June 1, 1992, and Landlord will
endeavor to cause Tenant's initial leasehold improvements to be substantially
complete on or before such date.

Substantial completion shall mean:

a) all ceilings and lighting in the leased premises are
in and operative;
b) all walls and partitions in the leased premises have
been erected with final painting or wall covering
complete, and doors and hardware have been installed;
c) all built-in cabinetry, millwork, glass, kitchen
appliances, plumbing in the leased premises have been
completed and installed and are in good working
order;
d) all floor coverings in the lease premises have been
installed and cleaned;
e) telephone company has completed its base service to
the leased premises with all lines operative, and all
wiring within the leased premises for voice and data
communications has been installed and is operative;

f) building elevators, plumbing, HNIAC and electrical
systems serving the l leased premises have been
installed and are in good working condition;
electrical service is adequate for Tenant's lighting
fixtures and office equipment, in keeping with the
approved space plans and final working drawings; and
HVAC system has been balanced;
g) all debris has been removed from the leased premises,
and the leased premises cleaned;
h) a certificate of occupancy for the leased premises
has been granted by the City of Dallas;
i) all exterior door locks shall be changed or re-keyed;
and
j) minor "punch-list" type items which do not impede
Tenant's use and comfort will not serve to delay
"Substantial Completion";

Note: Any necessary changes or modifications to the space
required to meet applicable codes or laws are to be
performed by Landlord at Landlord's cost.

41.4 Landlord and Tenant agree that if the space is not
substantially complete through no fault of the Tenant is not able to occupy the
Premises by June 1, 1992, through no fault of Tenant, then Tenant shall have
the option to cancel this Lease.

41.5 Landlord and Tenant agree that Tenant shall have the option to
cancel this Lease after the end of the third (3rd) and fourth (4th) lease year
by giving Landlord four (4) months prior written notice.

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<PAGE> 16
41.6 First Right of Refusal Landlord hereby grants to Tenant an
ongoing Right of First Refusal to lease the adjoining approximately 1,634
square feet of space to the east of the Premises. If Tenant elects to exercise
its Right of First Refusal to lease such space within the first two years of
the Lease Term, it shall be under the same terms and conditions of this Lease.
After the first two years if Landlord desires to lease such space to a third
party, Tenant shall have ten business days from receipt of such notice to
notify Landlord in writing of Tenant's intent to exercise its Right of First
Refusal. If Tenant does not exercise its Right of First Refusal, then Landlord
may lease such space to any third party. If Tenant elects to exercise its
Right of First Refusal to lease such space, the term for such space shall
expire simultaneously with the term of this Lease, and the rent for such space
shall be based on the lesser of the then prevailing rental rates for properties
of equivalent quality, size, utility and location, with the length of the Lease
term and credit standing of Tenant to be taken into account or a third party
offer, otherwise subject to all of the same terms, covenants, and conditions of
this Lease. Within thirty days from the date of Tenant's election to exercise
its Right of First Refusal, Tenant shall execute plans and specifications,
change orders showing construction costs to be paid by Tenant, if any, and a
Modification and Ratification of this Lease to include the additional space;
otherwise Tenant's Right of First Refusal shall terminate as to the space
described in the notice from Landlord to Tenant and Landlord may lease such
space to any third party. Landlord agrees not to lease the space subject to
the Right of First Refusal during tenant's first six months of occupancy.

Furthermore, Tenant will have the right throughout the term of the
Lease and any renewals or extensions to lease any space on the same floor on
terms and conditions no less favorable than are generally being offered and/or
concluded by Landlord to other prospective tenants or other tenants in the
buildings.

Improvements to Expansion Space: Should Tenant exercise its rights
granted under the lease to obtain additional area for expansion, then Tenant
shall receive the greater of whatever finish allowance is being offered a bona
fide third party or $2.00 per rentable square foot multiplied by the number of
years (or fraction thereof) remaining on the lease for remodeling the space
during the first three (3) years and $1.00 per rentable square foot per year
during the last two (2) years of occupancy.

41.7 Landlord and Tenant agree that Landlord shall pay a real
estate commission to Bell & Hocker, Inc. in accordance with the Registration
Letter and Commission Agreement attached hereto as Exhibit "C". Notwithstanding
such agreement, Tenant agrees to pay the initial commission due Bell & Hocker,
Inc.

41.8 Notwithstanding anything to the contrary contained in this
Lease, Tenant agrees to reimburse Landlord for the initial construction costs,
if any, incurred in remodeling the space to meet Tenant's specifications. Any
other costs specified herein beyond these initial costs shall be paid by
Landlord.

EXECUTED this 21st day of May, 1992.

LANDLORD: Sterling Plaza Ltd., by TENANT:Brigham Oil & Gas, L.P.
Sterling Projects, Inc., General Partner by Brigham Exploration
Company, General Partner

By: /s/ Larry Keim By: /s/ Anne L. Brigham
------------------------------------ ------------------------------

Name: Larry Keim Name: Anne L.Brigham
---------------------------------- ----------------------------

Title: Vice President Title: Vice President
--------------------------------- ---------------------------

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<PAGE> 1
EXHIBIT 10.13.1

FIRST AMENDMENT

This First Amendment (the "Amendment") is made and entered into as of
the 8th day of April, 1994, by and between ZML-Sterling Plaza Limited
Partnership ("Landlord") by its agent, Equity Office Properties, Inc., and
Brigham Oil & Gas. L.P., a Delaware Limited Partnership ("Tenant").

WITNESSETH

A. WHEREAS, Landlord (as successor in interest to Sterling Plaza, Ltd.)
and Tenant are parties to that certain lease dated the 21st day of May, 1992
currently containing approximately 11.537 rentable square feet of space
described as Suite No. 1616 on the 16th floor ("Original Premises") of the
building commonly known as Sterling Plaza and the address of which is 5949
Sherry Lane, Dallas, Texas (the "Building"), which lease has been previously
amended or assigned by instrument(s) dated April 1, 1993 and May 12, 1993
(collectively, the "Lease"); and

B. WHEREAS, Tenant has requested that additional space consisting of
approximately 3,660 rentable square feet on the 16th floor of the Building
shown on Exhibit A hereto (the "Expansion Space") be added to the Premises and
that the Lease be appropriately amended (the Original Premises and Expansion
Space are sometimes collectively referred to as the "Premises"), and Landlord
is willing to do the same on the terms and conditions set forth below;

C. WHEREAS, the Lease, and this First Amendment by its terms shall expire
on May 31, 1997 ("Termination Date");

NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained and other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant
agree as follows:

I. Expansion. Effective as of the Expansion Effective Date (as
hereinafter defined), the Premises is increased from 11,357 rentable square
feet on the 16th floor to 15,017 rentable square feet described as Suite No(s).
1616 and 1625 on the 16th floor by the addition of the Expansion Space. The
lease term for the Expansion Space shall commence on the Expansion Effective
Date and end on the Termination Date (as hereinafter defined). The Expansion
Space is subject to all the terms and conditions of the Lease except as
expressly modified herein and except that Tenant shall not be entitled to
receive any allowances, abatements or other financial concessions granted with
respect to the Premises unless such concessions are expressly provided for
herein with respect to the Expansion Space.

A. The Expansion Effective Date shall be the later to occur of
(i) April 15, 1994 ("Target Expansion Effective Date"), or (ii) the
date upon which Landlord's improvement work in the Expansion Space has
been substantially completed; provided, however, that if Landlord
shall be delayed in substantially completing the Landlord's work in
the Expansion Space as a result of the occurrence of any of the
following (a "Delay"):

1. Tenant's failure to furnish information or to respond
to any request by Landlord for any approval or
information within any time period prescribed or, if
no time period is prescribed, then within two (2)
Business Days of such request: or

2. Tenant's insistence on materials, finishes or
installations that have long lead times after having
first been informed by Landlord that such materials,
finishes or installations will cause a Delay
provided, however. Landlord agrees that the
materials. finishes and installations set forth in
the plans shall not cause a Delay: or

3. Changes in any plans and specifications; or

<PAGE> 2

4. The performance or nonperformance by a person or
entity employed by Tenant in the completion of any
work (all such work and such persons or entities
being subject to the prior approval of Landlord); or

5. Any request by Tenant that Landlord delay the
completion of any of the Landlord's work; or

6. Any breach or default by Tenant in the performance
of Tenant's obligations under this Amendment or the
Lease; or

7. Any delay resulting from Tenant's having taken
possession of the Expansion Space for any reason
prior to substantial completion of the Landlord's
work; or, except as required during construction; or

8. Any other delay, except as approved by Landlord,
chargeable to Tenant, its agents, employees or
independent contractors; or

then, for purposes of determining the Expansion Effective Date, the date of
substantial completion shall be deemed to be the day that said Landlord's work
would have been substantially completed absent any such Delay(s) and Force
Majeure. The Expansion Space shall be deemed to be substantially completed on
the date that Landlord reasonably determines that all Landlord's work has been
performed (or would have been performed absent any Delays), other than any
details of construction, mechanical adjustment or any other matter, the
noncompletion of which does not materially interfere with Tenant's use of the
Expansion Space. The adjustment of the Expansion Effective Date and,
accordingly, the postponement of Tenant's obligation to pay Rent on the
Expansion Space shall be Tenant's sole remedy and shall constitute full
settlement of ail claims that Tenant might otherwise have against Landlord by
reason of the Expansion Space not being ready for occupancy by Tenant on the
Target Expansion Effective Date. Notwithstanding the foregoing, if Landlord has
not substantially completed the improvement work by June 30, 1994, as such date
shall be extended due to Delays or Force Majeure, this First Amendment shall be
deemed null and void.

B. In addition to the postponement, if any, of the Expansion Effective
Date as a result of the applicability of Paragraph I.A. of this Amendment, the
Expansion Effective Date shall be delayed to the extent that Landlord fails to
deliver possession of the Expansion Space for any other reason, including but
not limited to, holding over by prior occupants. Any such delay in the
Expansion Effective Date shall not subject Landlord to any liability for any
loss or damage resulting therefrom. If the Expansion Effective Date is delayed,
the Termination Date (as hereinafter defined) under the Lease shall not be
similarly extended.

II. MONTHLY RENTAL INSTALLMENTS.

A. ORIGINAL PREMISES THROUGH TERMINATION DATE. The Monthly Rental
Installments and all other charges under the Lease shall be payable as provided
therein with respect to the Original Premises through the Termination Date. Ali
such Basic Rental shall be payable by Tenant in accordance with the terms of
Article 3. of the Lease.

B. EXPANSION SPACE FROM EXPANSION EFFECTIVE DATE THROUGH TERMINATION DATE.
As of the Expansion Effective Date, the schedule of Monthly Rental Installments
of Basic Rental payable with respect to the Expansion Space for the balance of
the Lease Term and through the Termination Date is the following:

Tenant shall pay Landlord the sum of one hundred seventy-one thousand nine
hundred five and 63/100 Dollars ($171,905.63) as Basic Rental in thirty-eight
(38) monthly installments as follows:

A. One (1) installment of $2,292.08 payable on the execution of this First
Amendment for the period beginning on April 15,1994 and ending on April 30,
1994.

B. Thirty-seven (37) equal installments of $4,584.15 each payable on or
before the first day of each month during the period beginning May 1, 1994 and
ending May 31, 1997.

<PAGE> 3

Landlord and Tenant acknowledge that the foregoing schedule is based on the
assumption that the Expansion Effective Date is the Target Expansion Effective
Date. If the Expansion Effective Date is postponed, the beginning date set
forth above with respect to the payment of any installment(s) of Base Rental
shall be appropriately adjusted on a per diem basis and set forth in a
commencement agreement to be prepared by Landlord. All such Basic Rental shall
be payable by Tenant in accordance with the terms of Article 3. of the Lease.

III. TENANT'S PRO RATA SHARE. For the period commencing with the Expansion
Effective Date and ending on the Termination Date, Tenant's Pro Rata Share for
the Premises is five and two hundredths percent (5.02%).

IV. EXPENSE ESCALATION

A. EXPANSION SPACE FROM EXPANSION EFFECTIVE DATE THROUGH TERMINATION DATE.
For the period commencing with the Expansion Effective Date and ending on the
Termination Date, the Expansion Space Base Year herein defined for the
computation of Tenant's Pro Rata Share of Operating Expenses applicable to the
Expansion Space is 1994 (the "Expansion Space Base Year"). For the purposes of
calculating the Expansion Space Base Year and Tenant's Pro Rata Share of
Operating Expenses during the period commencing on the Expansion Effective Date
and ending on the Termination Date, the Operating Expenses shall be calculated
in accordance with Article 4 of the Lease.

V. IMPROVEMENTS TO EXPANSION SPACE.

A. Tenant has inspected the Expansion Space and agrees to accept the same
"as is" without any agreements, representations, understandings or obligations
on the part of Landlord to perform any alterations, repairs or improvements,
except as may be expressly provided otherwise in this Amendment.

B. COST OF IMPROVEMENTS TO EXPANSION SPACE. Provided Tenant is not in
default, any initial construction, alteration or improvement to the Expansion
Space shall be done at Landlord's sole cost and expense.

C. RESPONSIBILITY FOR IMPROVEMENTS TO EXPANSION SPACE. Landlord shall
enter into a direct contract with a general contractor selected by Landlord for
the initial improvements to the Expansion Space which are to be performed in
accordance with the plans dated the 3rd day of Feb., 1994 as revised the 15th
day of February, 1994 prepared by Steve Waddill & Company (the "Plans").

VI. RIGHT OF FIRST OFFER

A. Subject to the rights of Padgett Printing Corporation, Davrus of Texas,
Co. and D. Evans, Inc. during the period commencing April 15, 1994 and ending
May 31, 1997 (the "ROFO Period") Tenant shall have the right to first offer
(the "ROFO") with respect to approximately 4,773 rentable square feet located
on the sixteenth (16th) floor of the Building shown cross-hatched on the
demising plan attached hereto as Attachment #1 (the "Offering Space"). If at
any time during the ROFO Period, Landlord has a prospective tenant (the
"Prospect") interested in leasing the Offering Space (or applicable portion
thereof) Landlord shall advise Tenant in substantially the same form set forth
as Attachment #2 attached hereto (the "Landlord Notice") of the terms of which
Landlord is prepared to lease the Offering Space to Tenant for the remainder of
the Lease Term, which terms shall reflect the prevailing market rate for the
Offering Space, as reasonably determined by Landlord, and a tenant finish
allowance then being quoted by Landlord for comparable space and lease term in
the Building. In the event that Tenant desires to lease the Offering Space upon
the terms set forth in Landlord's Notice, Tenant shall notify Landlord (the
"Tenant Notice") within five (5) days after the date of such Notice, except
that Tenant shall have no such ROFO, and Landlord need not give the Landlord
Notice, if:

1. Tenant is in default under the Lease at the time Landlord would
otherwise deliver the Landlord Notice; or

<PAGE> 4

2. the Premises is sublet, unless to an affiliate company or if
otherwise agreed in writing, at the time Landlord would otherwise
deliver the Landlord Notice; or

3. the Lease has been assigned, unless to an affiliate company of if
otherwise agreed in writing, at the time Landlord would otherwise
deliver the Landlord Notice; or

4. Tenant is not an occupant of the Building under this Lease at the
time landlord would otherwise deliver the Landlord Notice; or

5. the Prospect is a tenant in the applicable Offering Space at the
time Lessor would otherwise deliver the Lessor Notice.

B. The ROFO shall be deemed exercised upon Landlord's receipt of the
Tenant Notice within the time period stated in subsection VI. A. hereof. If
Tenant exercises the ROFO, Tenant shall execute and deliver the Offering
Amendment (hereinafter defined) to Landlord within fifteen (15) days of the
submission of such Offering Amendment by Landlord to Tenant.

C. The Offering Space (including improvements and personally, if any)
shall be acceptable by Tenant in broom clean condition and its as-built
configuration existing, subject to the tenant finish allowance pursuant to
Landlord Notice. On the earlier of the date tenant takes possession of the
Offering Space or as of the date the term for such Offering Space commences.

D. 1. If Tenant is able to and properly exercises its ROFO, Landlord
shall prepare an amendment (the "Offering Amendment") adding the
Offering Space to the Premises on the terms set forth in the Landlord
Notice and reflecting the changes in the Basic Rental, Installments of
Basic Rental, Rental Area of the Premises, Tenant's proportionate
share of the operating expenses and other appropriate terms.

2. A copy of the Offering Amendment shall be (i) sent to Tenant within
a reasonable time after receipt of the Tenant Notice, and (ii)
executed by tenant and returned to Landlord in accordance with
subsection VI B. hereof.

E. If Landlord is not required to give Tenant a Landlord Notice due to a
violation by Tenant of one or more of the conditions set forth in subsection VI
A.1. through VI A.5. above, Landlord may lease the Offering Space for which
Landlord has Prospect to the Prospect or any other prospective tenant on
whatever terms Landlord elects.

VII. PARKING

Effective as of the Expansion Effective Date, Landlord shall make
available eight (8) additional parking spaces. Of said eight (8) spaces, one (1
) shall be reserved and seven (7) shall be on a first come first serve basis.
During the period commencing on the Expansion Effective Date and ending on the
Termination Date, said eight (8) additional spaces shall be at no charge during
the balance of the Lease Term.

VIII. ACCELERATION OPTION

Landlord and Tenant agree that the cancellation option pursuant to
Section 41.5 of the Lease shall not apply to the Expansion Space. Landlord
hereby grants Tenant the right to terminate the Lease with respect to the
Expansion Space as follows:

A. Tenant shall have the right to accelerate the Termination Date (the
"First Expansion Space Acceleration Option") of the Expansion Space from May
31, 1997 to May 31, 1995 (the "First Expansion Space Accelerated Termination
Date"), if:

1. Landlord receives written notice of acceleration (the "First
Expansion Space Acceleration Notice") on or before January 31, 1995;

2. Tenant is not in default under the Lease or if Tenant is in
default, such default has been cured within the applicable cure
periods in the Lease as of the date Tenant provides Landlord with the
First Expansion Space Acceleration Notice;

<PAGE> 5

3. All subleases of the Premises terminate on or before the First
Expansion Space Accelerated Termination Date;

4. this Lease has not been assigned to a non-affiliated company
as of the date Landlord receives the Acceleration Notice;

5. Tenant surrenders possession of the Premises on or prior to
the First Expansion Space Accelerated Termination Date; and

6. Tenant, on or before the First Expansion Space Accelerated
Termination Date, pays Landlord a termination fee equal to $28,589.39
(the "First Expansion Space Termination Fee"), provided that the
Termination Fee shall be increased by an amount equal to the
unamortized portion (based on an interest rate of thirteen percent
(13%) per annum) of any concessions, commissions, allowances or other
expenses incurred by Landlord for any Offering Space leased by Tenant
that is subject to the Acceleration Option hereunder.

B. Tenant shall have the right to accelerate the Termination Date (the
"Second Expansion Space Acceleration Option") of the Expansion Space from May
31, 1997 to May 31, 1996 (the "Second Expansion Space Accelerated Termination
Date"), if:

1. Landlord receives written notice of acceleration (the "Second
Expansion Space Acceleration Notice") on or before January 31,1996;

2. Tenant is not in default under the Lease or if Tenant is in
default such default has been cured within the applicable cure periods
as of the date Tenant provides Landlord with the Second Expansion
Space Acceleration Notice;

3. All subleases of the Premises terminate on or before the
Second Expansion Space Accelerated Termination Date;

4. this Lease has not been assigned to a non-affiliated company
or unless otherwise approved in writing as of the date Landlord
receives the Acceleration Notice;

5. Tenant surrenders possession of the Premises on or prior to
the Second Expansion Space Accelerated Termination Date; and

6. Tenant, on or before the Second Expansion Space Accelerated
Termination Date, pays Landlord a termination fee equal to $15,526.43
(the "Second Expansion Space Termination Fee"), provided that the
Second Expansion Space Termination Fee shall be increased by an amount
equal to the unamortized portion (based on an interest rate of
thirteen percent (13%) per annum) of any concessions, commissions,
allowances or other expenses incurred by Landlord for any Offering
Space leased by Tenant that is subject to the Second Expansion Space
Acceleration Option hereunder.

C. If Tenant exercises its First or Second Expansion Space Acceleration
Option, subject to satisfaction of the conditions set forth in subsection A and
B above, the Term, Termination Date, total Base Rental and other appropriate
terms of this Amendment shall be deemed amended to the extent necessary to
account for such exercise by Tenant.

D. If Tenant exercises its First or Second Expansion Space Acceleration
Option, Tenant shall remain liable for all Base Rental and other sums due under
the Lease up to and including the First or Second Expansion Space Accelerated
Termination Date even though billings for such may occur subsequent to the
First or Second Expansion Space Accelerated Termination Date.

E. If Tenant, subsequent to providing Landlord with the First or Second
Expansion Space Acceleration Notice, defaults in any of the provisions of this
Lease, and fails to cure within the applicable cure periods, Landlord at its
option, may declare Tenant's exercise of the Acceleration Option to be null and
void.

<PAGE> 6

IX. MISCELLANEOUS.

A. This Amendment sets forth the entire agreement between the
parties with respect to the matters set forth herein. There have been
no additional oral or written representations or agreements. Under no
circumstances shall Tenant be entitled to any Rent abatement, on
improvement allowance, leasehold improvements, or other work to the
Expansion Space, or any similar economic incentives that may have been
provided Tenant in connection with entering into the Lease, unless
specifically set forth in this Amendment.

B. Except as herein modified or amended, the provisions,
conditions and terms of the Lease shall remain unchanged and in full
force and effect.

C. In the case of any inconsistency between the provisions of the
Lease and this Amendment, the provisions of this Amendment shall
govern and control. Under no circumstances shall this Amendment be
deemed to grant Tenant any further right to expand the Premises or
extend the Lease, provided, however, any such additional rights
specifically provided Tenant in the Lease are not hereby relinquished
or waived.

D. Submission of this Amendment by Landlord is not an offer to
enter into this Amendment but rather is a solicitation for such an
offer by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.

E. The capitalized terms used in this Amendment shall have the
same definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.

F. Deleted.

G. Tenant hereby represents to Landlord that Tenant has dealt
with no broker other than Bell & Hocker in connection with this
Amendment. Tenant agrees to indemnify and hold Landlord and the
Landlord Related Parties harmless from all claims of any brokers
claiming to have represented Tenant in connection with this Amendment.

X. LIMITATION OF LIABILITY.

Notwithstanding anything to the contrary contained in this lease, the
Liability of Landlord (and of any successor Landlord hereunder) to Tenant shall
be limited to the interest of Landlord in the building, and Tenant agrees to
look solely to Landlord's interest in the building for the recovery of any
judgement or award against the Landlord, it being intended that Landlord shall
not be personally liable for any judgement or deficiency. Tenant hereby
covenants that, prior to the filing of any suit for an alleged default by
Landlord hereunder, it shall give Landlord and all mortgagees whom Tenant has
been notified hold mortgages or deed of trust liens on the property, building
or premises notice and the same amount of time as Landlord has under the Lease
to cure such alleged default by Landlord. In addition, Tenant acknowledges that
Equity Office Properties, Inc. is acting solely in its capacity as agent for
Landlord and shall not be liable for any obligations, liabilities, losses or
damages arising out of or in connection with this lease, all of which are
expressly waived by Tenant.

<PAGE> 7

IN WITNESS WHEREOF, Landlord and Tenant have duly executed this
Amendment as of the day and year first above written.

ATTEST: LANDLORD: ZML-Sterling Plaza Limited
Partnership

BY: EQUITY OFFICE PROPERTIES, INC.,
as Agent

/s/ J. Hay By: /s/
- ------------------ --------------------------------------------
J. Hay Name:
- ------------------ ------------------------------------------
Title: Vice Chairman
-----------------------------------------

TENANT: Brigham Oil & Gas. L.P.,
a Delaware Limited Partnership

By: Brigham Exploration Company
- ------------------ --------------------------------------------
Its: Managing General Partner
- ------------------ -------------------------------------------
By: /s/ Anne L. Brigham
--------------------------------------------
Anne L. Brigham, Vice President

<PAGE> 1
EXHIBIT 10.13.2

SECOND AMENDMENT

This Second Amendment (the "Amendment") is made and entered into as of
the 29th day of June, 1994, by and between ZML - Sterling Plaza Limited
Partnership ("Landlord") by its agent, Equity Office Properties, Inc., and
Brigham Oil & Gas, Inc., L.P., a Delaware Limited Partnership ("Tenant").

WITNESSETH

A. WHEREAS, Landlord and Tenant are parties to that certain lease dated the
21st day of May, 1992 currently containing approximately 15,017 rentable square
feet of space, described as Suite Nos. 1616 and 1025 on the 16th floor of the
building commonly known as Sterling Plaza and the address of which is 5949
Sherry Lane, Dallas, Texas (the "Building"), which lease has been previously
amended or assigned by instruments dated April 1, 1993, May 12, 1993 and April
8, 1994 (collectively, the "Lease"); and

B. WHEREAS, Tenant and Landlord mutually desire that the Lease be amended
on and subject to the terms and conditions hereinafter set forth;

NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:

I. AMENDMENT. Landlord and Tenant agree that the Lease shall be
amended in accordance with the following terms and conditions:

A. The Expansion Effective Date pursuant to Paragraph I.A. of the
First Amendment is hereby amended to May 9, 1994.

B. Notwithstanding anything to the contrary contained in Paragraph
II.B. of the First Amendment, Tenant shall pay Landlord monthly
installments of Base Rental with respect to the Expansion Space
as follows:

(i) One (1) installment of $3,401.44 payable on or before the
first day of the month during the period beginning May 9,
1994 and May 31, 1994.

(ii) Thirty-six (36) equal installments of $4,584.15 each
payable on or before the first day of each month during
the period beginning June 1, 1994 and ending May 31, 1997.

II. EFFECTIVE DATE. This Amendment shall become effective as of May
1, 1994 (the "Effective Date") and shall continue in effect until
otherwise amended by the parties in writing or until expiration
of this Second Amendment.

III. MISCELLANEOUS.

A. This Amendment sets forth the entire agreement between the
parties with respect to the matters set forth herein. There have
been no additional oral or written representations or agreements.

B. Except as herein modified or amended, the provisions,
conditions and terms of the Lease shall remain unchanged and in
full force and effect.

C. In the case of any inconsistency between the provisions of
the Lease and this Amendment, the provisions of this Amendment
shall govern and control.

D. Submission of this Amendment by Landlord is not an offer
to enter into this Amendment but rather is a solicitation for
such an offer by Tenant.
<PAGE> 2
Landlord shall not be bound by this Amendment until Landlord has
executed and delivered the same to Tenant.

E. The capitalized terms used in this Amendment shall have
the same definitions as set forth in the Lease to the extent that
such capitalized terms are defined therein and not redefined in
this Amendment.

F. Deleted.

IV. LIMITATION OF LIABILITY.

Notwithstanding anything to the contrary contained in this lease,
the Liability of Landlord (and of any successor Landlord
hereunder) to Tenant shall be limited to the interest of Landlord
in the building, and Tenant agrees to look solely to Landlord's
interest in the building for the recovery of any judgement or
award against the Landlord, it being intended that Landlord shall
not be personally liable for any judgement or deficiency. Tenant
hereby covenants that, prior to the filing of any suit for an
alleged default by Landlord hereunder, it shall give Landlord and
all mortgagees whom Tenant has been notified hold mortgages or
deed of trust liens on the property, building or premises notice
and the same amount of time as Landlord has under the Lease to
cure such alleged default by Landlord. In addition, Tenant
acknowledges that Equity Office Properties, Inc. is acting solely
in its capacity as agent for Landlord and shall not be liable for
any obligations, liabilities, losses or damages arising out of or
in connection with this lease, all of which are expressly waived
by Tenant.

IN WITNESS WHEREOF, Landlord and Tenant have duly executed this
Amendment as of the day and year first above written.

ATTESTATION LANDLORD: ZML - Sterling Plaza Limited
Partnership

BY: EQUITY OFFICE PROPERTIES INC.,
as Agent

By: /s/ Randy S. Bessolo
------------------------------------

/s/ Karen Mikos Name: Randy S. Bessolo
- -----------------------------------

Karen Mikos Title: Asst. VP - Asset Mgmt.
- -----------------------------------

TENANT: Brigham Oil & Gas, L.P. a
Delaware Limited Partnership

/s/ Christine J. Bowman By: /s/ Anne L. Brigham
- ----------------------------------- ------------------------------------

Christine J. Bowman Its: Anne L. Brigham
- ----------------------------------- -----------------------------------

Administrative Assistant

<PAGE> 1
EXHIBIT 10.13.3

THIRD AMENDMENT

This Third Amendment (the "Third Amendment") is made and entered into as of the
30th day of December, 1996, by and between ZML - Sterling Plaza Limited
Partnership ("Landlord") by its agent, Equity Office Holdings, L.L.C., a
Delaware limited liability company, and Brigham Oil & Gas, L.P. a Delaware
Limited Partnership ("Tenant").

WITNESSETH

A. WHEREAS, Landlord and Tenant are parties to that certain lease dated
the 21st day of May 1992 currently containing approximately 15,017 rentable
square feet of space described as Suite No(s). 1616 and 1625 on the 16th
floor(s) ("Original Premises") of the building commonly known as Sterling Plaza
and the address of which is 5949 Sherry Lane, Dallas, Texas (the "Building"),
which lease has been previously amended or assigned by instrument(s) dated
April 1, 1993, May 12, 1993, April 8, 1994 and June 29, 1994 (collectively, the
"Lease"); and

B. WHEREAS, Tenant has requested that additional space consisting of
approximately 907 rentable square feet on the 16th floor of the Building shown
on Exhibit A hereto (the "Expansion Space") be added to the Premises and that
the Lease be appropriately amended (the Original Premises and Expansion Space
are sometimes collectively referred to as the "Premises"), and Landlord is
willing to do the same on the terms and conditions set forth below;

C. WHEREAS, the Lease by its terms shall expire on May 31, 1997, ("Prior
Termination Date"), and the parties desire to extend the Lease, all on the
terms and conditions set forth below;

I. EXPANSION. Effective as of the Expansion Effective Date (as
hereinafter defined), the Premises is increased from 15,017 rentable square
feet on the 16th floor(s) to 15,924 rentable square feet on the 16th floor(s)
by the addition of the Expansion Space. The lease term for the Expansion Space
shall commence on the Expansion Effective Date and end on the Extended
Termination Date (as hereinafter defined). The Expansion Space is subject to
all the terms and conditions of the Lease except as expressly modified herein
and except that Tenant shall not be entitled to receive any allowances,
abatements or other financial concessions granted with respect to the Premises.

A. The Expansion Effective Date shall be November 15, 1996.

B. The Expansion Effective Date shall be delayed to the extent
that Landlord fails to deliver possession of the Expansion Space for
any reason (other than delays by Tenant), including but not limited
to, holding over by prior occupants. Any such delay in the Expansion
Effective Date shall not subject Landlord to any liability for any
loss or damage resulting therefrom. If the Expansion Effective Date is
delayed, the Extended Termination Date (as hereinafter defined) under
the Lease shall not be similarly extended.

II. EXTENSION. The Lease Term is hereby modified from five (5)
years, zero (0) months, and zero (0) days expiring on May 31, 1997 ("Prior
Termination Date") to five (5) years, three (3) months, and zero (0) days
("Extended Lease Term") expiring on August 31, 1997 ("Extended Termination
Date"), unless sooner terminated in accordance with the terms of the Lease.
That portion of the Lease Term commencing the day immediately following the
Prior Termination Date ("Extension Date") and ending on the Extended
Termination Date shall be referred to herein as the "Extended Term."

III. MONTHLY RENTAL INSTALLMENTS.

A. ORIGINAL PREMISES THROUGH PRIOR TERMINATION DATE. The Monthly
Rental Installments and all other charges under the Lease shall be
payable as provided therein with respect to the Original Premises
through and including the Prior Termination Date.

-1-

<PAGE> 2

B. ORIGINAL PREMISES FROM AND AFTER EXTENSION DATE. As of the
Extension Date, the schedule of Monthly Rental Installments of Basic
Rental payable with respect to the Original Premises for the Extended
Lease Term is the following:

Tenant shall pay Landlord the sum of Sixty-Nine Thousand Four Hundred
Fifty-Three and 63/100 Dollars ($69,453.63) as Basic Rental for the
Original Premises for the Extended Term in three (3) monthly
installments as follows:

(i). Three (3) equal installments of $23,151.21 each payable on or
before the first day of each month during the period beginning June 1,
1997 and ending August 31, 1997.

All such Basic Rental shall be payable by Tenant in accordance
with the terms of Article 3. of the Lease.

C. EXPANSION SPACE FROM EXPANSION EFFECTIVE DATE THROUGH EXTENDED
TERMINATION DATE. As of the Expansion Effective Date, the schedule of
Monthly Rental Installments of Basic Rental payable with respect to
the Expansion Space for the balance of the Lease Term and the Extended
Lease Term is the following:

Tenant shall pay Landlord the sum of Thirteen Thousand Two
Hundred Eighty Three and 76/100 Dollars ($13,283.76) as Base Rental for
the Extended Term in ten (10) monthly installments as follows:

(i). One (1) installment of $699.15 payable on or before November
15, 1996 for the period beginning November 15, 1996 and ending
November 30, 1996.

(ii). Nine (9) equal installments of $1,398.29 each payable on or
before the first day of each month during the period beginning
December 1, 1996 and ending August 31, 1997.

All such Basic Rental shall be payable by Tenant in accordance with the
terms of Article 3. of the Lease.

IV. TENANT'S PRO RATA SHARE. For the period commencing with the
Expansion Effective Date and ending on the Extended Termination Date, Tenant's
pro rata share for the Expansion Space is three tenths percent (0.3%).

V. EXPENSE ESCALATION.

A. ORIGINAL PREMISES FOR THE EXTENDED TERM. For the
period commencing with the Extension Date and ending on the
Extended Termination Date,

(i). Tenant shall pay any increases in Operating
Expenses in accordance with Article 4. of the Lease.

B. EXPANSION SPACE FROM EXPANSION EFFECTIVE DATE THROUGH
EXTENDED TERMINATION DATE. For the period commencing with the
Expansion Effective Date and ending on the Extended
Termination Date,

(i). Tenant shall pay any increases in Operating
Expenses in accordance with Section 4. of the Lease
with respect to the Expansion Space.

VI. IMPROVEMENTS TO EXPANSION SPACE.

A. Tenant has inspected the Expansion Space and agrees
to accept the same "as is" without any agreements,
representations, understandings or obligations on the part of
Landlord to perform any alterations, repairs or improvements.

VII. OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that
the Lease shall be amended in the following additional respects:

-2-

<PAGE> 3

A. Parking. Effective on or after the Expansion
Effective Date and upon request by Tenant, Landlord shall
provide Tenant three (3) additional unreserved parking spaces
in the Building's garage. Tenant shall pay $135.00 (plus
applicable tax) per month for said three (3) unreserved
spaces.

B. The first sentence of Section 39., Renewal Option. of
the Lease is hereby deleted in its entirety and the following
substituted therefor:

"If Tenant has not exercised the One Year Renewal Option
contained in the Third Amendment to the Lease and if, at the
end of the Primary term of this Lease the Tenant is not in
default of any of the terms, conditions or covenants of the
Lease, Tenant, but not any assignee or subtenant of Tenant
unless affiliate company or if otherwise agreed to in
writing, is hereby granted an option to renew this Lease for
an additional term of 60 months upon the same terms and
conditions contained in this Lease with the following
exceptions."

C. One Year Renewal Option.

1. Tenant shall have the right to extend the Lease Term
for an additional period of one year, commencing on the day
immediately following the Extended Termination Date of the
initial Lease Term and ending on the first anniversary of the
Termination Date (the "One Year Renewal Term"), if:

a. Landlord receives notice of exercise
(the "One Year Renewal Notice") not later
than November 15, 1996, which notice shall
specify which option is being exercised,
and

b. Tenant is not in default under the
Lease beyond any applicable cure periods at
the time that Tenant delivers its Initial
Renewal Notice or at the time Tenant
delivers its Binding Notice; and

c. Not more than 10% of the Premises is
sublet at the time that Tenant delivers its
One Year Renewal Notice or at the time
Tenant delivers its Binding Notice; and

d. The Lease has not been assigned
prior to the date that Tenant delivers its
One Year Renewal Notice or prior to the
date Tenant delivers its Binding Notice;
and

e. Tenant executes and returns the
Renewal Amendment (hereinafter defined)
within fifteen (15) days after its
submission to Tenant.

2. The initial Base Rental rate per rentable square foot
for the Premises during the One Year Renewal Term shall equal
the Prevailing Market (hereinafter defined) rate per rentable
square foot for the Premises.

3. Within thirty (30) days after receipt of Tenant's
Initial Renewal Notice, Landlord shall advise Tenant of the
applicable Base Rental rate for the Premises for the One Year
Renewal Term. Tenant, within thirty (30) days after the date
on which Landlord advises Tenant of the applicable Base
Rental rate for the One Year Renewal Term, shall either (i)
give Landlord final binding written notice ("Binding Notice")
of Tenant's exercise of its option, or (ii) if Tenant
disagrees with Landlord's determination, provide Landlord
with written notice of rejection (the "Rejection Notice"). If
Tenant fails to provide Landlord with either a Binding Notice
or Rejection Notice within such thirty (30) day period,
Tenant's One Year Renewal Option shall be null and void and
of no further force and effect. If Tenant provides Landlord
with a Binding Notice, Landlord and Tenant shall enter into
the Renewal Amendment upon the terms and conditions set forth
herein. If Tenant provides Landlord with a Rejection Notice,
Landlord and Tenant shall

-3-

<PAGE> 4

work together in good faith to agree upon the Prevailing
Market Base Rental rate for the Premises during the One Year
Renewal Term. Upon agreement Tenant shall provide Landlord
with Binding Notice and Landlord and Tenant shall enter into
the Renewal Amendment in accordance with the terms and
conditions hereof. Notwithstanding the foregoing, if Landlord
and Tenant are unable to agree upon the Prevailing Market
Base Rental rate for the Premises within thirty (30) days
after the date on which Tenant provides Landlord with a
Rejection Notice, Tenant's One Year Renewal Option shall be
null and void and of no force and effect.

4. If Tenant is entitled to and properly exercises its
One Year Renewal Option, Landlord shall prepare an amendment
(the "Renewal Amendment") to reflect changes in the Base
Rental, Lease Term, Extended Termination Date and other
appropriate terms. The Renewal Amendment shall be:

a. sent to Tenant within a reasonable time
after receipt of the One Year Renewal Notice; and

b. executed by Tenant and returned to Landlord
in accordance with paragraph C.1.e. above.

5. For purposes hereof, "Prevailing Market" shall mean
the arms length fair market annual rental rate per rentable
square foot under renewal leases and amendments entered into
on or about the date on which the Prevailing market is being
determined hereunder for space comparable to the Premises in
the Building and office buildings comparable to the Building
in Preston Center, Dallas, Texas area. The determination of
Prevailing Market shall take into account any material
economic differences between the terms of this Lease and any
comparison lease, such as rent abatements, construction costs
and other concessions and the manner, if any, in which the
Landlord under any such lease is reimbursed for operating
expenses and taxes. The determination of Prevailing Market
shall also take into consideration any reasonably anticipated
changes in the Prevailing Market rate and parking charges
from the time such Prevailing Market rate is being determined
and the time such Prevailing Market rate will become
effective under this Lease.

VIII. MISCELLANEOUS.

A. This Amendment sets forth the entire agreement between the
parties with respect to the matters set forth herein. There have been
no additional oral or written representations or agreements. Under no
circumstances shall Tenant be entitled to any Rent abatement,
improvement allowance, leasehold improvements, or other work to the
Premises, or any similar economic incentives that may have been
provided Tenant in connection with entering into the Lease, unless
specifically set forth in this Amendment or the Lease.

B. Except as herein modified or amended, the provisions,
conditions and terms of the Lease shall remain unchanged and in full
force and effect.

-4-

<PAGE> 5

F. Deleted.

G. Tenant hereby represents to Landlord that Tenant has dealt
with no broker other than Sam Hocker with Grubb & Ellis Company in
connection with this Amendment. Tenant agrees to indemnify and hold
Landlord and the Landlord Related Parties harmless from all claims of
any brokers claiming to have represented Tenant in connection with
this Amendment.

H. TENANT HEREBY WAIVES ALL RIGHTS TO PROTEST THE APPRAISED
VALUE OF THE PROPERTY OR TO APPEAL THE SAME AND ALL RIGHTS TO
RECEIVE NOTICES OF REAPPRAISALS AS SET FORTH IN SECTIONS 41.4113
AND 42.015 OF THE TEXAS TAX CODE.

IN WITNESS WHEREOF, Landlord and Tenant have duly executed this
Amendment as of the day and year first above written.

WITNESSES; ATTESTATION LANDLORD: ZML - Sterling Plaza Limited
Partnership

BY: EQUITY OFFICE HOLDINGS, L.L.C., as
Agent

/s/ Pat Washington By: /s/ Kim V. Koehn
- --------------------------- ----------------------------------------
Kim V. Koehn
Pat Washington SVP
- ---------------------------
TENANT: Brigham Oil & Gas, L.P.,
a Delaware Limited Partnership

/s/ By: /s/ Anne L. Brigham
- --------------------------- ----------------------------------------
/s/ Its: Executive Vice President
- --------------------------- ---------------------------------------

-5-

<PAGE> 1
EXHIBIT 10.13.4

MODIFICATION AND RATIFICATION OF LEASE

This Modification and Ratification of Lease Agreement is made and
entered into between Sterling Plaza Ltd., by Sterling Projects, Inc., General
Partner (Lessor or Landlord) and Brigham Oil Gas., L.P. (A Delaware Limited
Partnership) (Lessee or Tenant) for and in consideration of One Dollar ($1.00)
and other good and valuable consideration, receipt of which is hereby
acknowledged.

W I T N E S S E T H:

1. Lessor and Lessee hereby confirm and ratify, except as
modified below, all of the terms, conditions and covenants in that certain
written Lease Agreement dated May 21, 1992, between Lessor and Lessee, for the
rental of the following described property: Approximately 6,038 rentable square
feet of office space located at 5949 Sherry Lane, Suite 1616, Dallas, Texas
75225.

2. Lessor and Lessee agree that commencing upon occupancy the
square footage of the premises shall be increased to include the space shown on
the attached Exhibit "A" (Expansion Space) from 6,038 rentable square feet to
7,672 rentable square feet.

3. Lessor and Lessee agree that commencing upon occupancy the
monthly rental payments shall be increased from $7,170.00 to $9,110.38 with
expiration date to remain May 31, 1997. However, in accordance with paragraph
1.f. of that certain Lease Agreement dated May 21, 1992, tenant shall receive a
rental credit of $7,170.00 during months 8, 11, 14, 20, 26, 32, 38, 44 and 56,
leaving a rental balance due for each of those months of $1,940.38.

4. Lessor and Lessee hereby agree that such tenant finish
allowance in the total amount of $ 13,611.22 shall be first applied to the
construction and refurbishing cost of the Expansion Space. Any excess in this
tenant finish allowance over the actual construction and refurbishing costs of
the Expansion Space may be expended as tenant finish for existing space,
including the Expansion Space, or any additional space leased by Tenant through
July 31, 1993. Any excess not used by July 31, 1993 shall be applied as a full
or partial rental abatement on the Expansion Space commencing in month 20 and
continuing every 6th month thereafter until such excess is exhausted.

5. Lessor and Lessee hereby agree that Lessor shall provide four
(4) additional unreserved parking spaces at no additional cost to Lessee.

6. Lessor and Lessee hereby agree that all other terms and
conditions of the Lease Agreement shall remain the same.

Signed at Dallas, Texas, this 1st day of April, 1993.

LESSOR: Sterling Plaza Ltd., by
Sterling Projects, Inc., General Partner

BY: /s/ Larry Kelm
--------------------------------------------------
Larry Kelm

TITLE: Vice President
-----------------------------------------------

LESSEE: Brigham Oil & Gas, L.P.
(A Delaware Limited Partnership)

BY: /s/ Anne L. Brigham
--------------------------------------------------
Anne Brigham

TITLE: Vice President
-----------------------------------------------

<PAGE> 1
EXHIBIT 10.13.5

MODIFICATION AND RATIFICATION OF LEASE

This Modification and Ratification of Lease Agreement is made and
entered into between Sterling Plaza Ltd., by Sterling Projects, Inc., General
Partner (Lessor or Landlord) and Brigham Oil & Gas., L.P. (A Delaware Limited
Partnership) (Lessee or Tenant) for and in consideration of One Dollar ($1.00)
and other good and valuable consideration, receipt of which is hereby
acknowledged.

W I T N E S S E T H:

1. Lessor and Lessee hereby confirm and ratify, except as
modified below, all of the terms, conditions and covenants in that certain
written Lease Agreement dated May 21, 1992 and Modification and Ratification of
Lease dated April 1, 1993, between Lessor and Lessee, for the rental of the
following described property: Approximately 7,672 rentable square feet of
office space located at 5949 Sherry Lane, Suite 1616, Dallas, Texas 75225.

2. Lessee warrants that Lessee has accepted and is now in
possession of the demised premises and that the Lease Agreement is valid and
presently in full force and effect.

3. Lessor and Lessee agree that upon occupancy the square footage
of the premises shall be increased by 3,685 square feet, from 7,672 square feet
to 11,357 square feet.

4. Lessor and Lessee agree that upon occupancy, the monthly
rental payments shall be changed from $9,110.38 per month to $13,716.63 per
month. However, in accordance with paragraph 1.f. of that certain Lease
Agreement dated May 21, 1992, tenant shall receive a rental credit of $7,170.00
during months 8, 11, 14, 20, 26, 32, 38, 44 and 56, leaving a rental balance
due for each of those months of $6,546.63.

5. Lessor and Lessee hereby agree that the operating expense stop
shall be the actual operating expenses for 1993 on the additional 3,685 square
feet.

6. Lessor and Lessee hereby agree that Lessor shall bear the
actual costs, not to exceed $5.00 per square foot to improve the additional
3,685 square feet.

7. Lessor and Lessee hereby agree that Lessor shall provide ten
(10) additional unreserved and two (2) reserved parking spaces at no additional
cost to Lessee.

8. First Right of Refusal: Lessor hereby grants to Lessee an
ongoing Right of First Refusal to lease the adjoining approximately 2,822
square feet of space to the east of the Premises on the north side of the
Building. If Lessee elects to exercise its Right of First Refusal to lease
such space within the first two (2) years of the date of this Modification and
Ratification of Lease, it shall be under the same terms and conditions of this
Modification and Ratification of Lease. After the first two (2) years if
Lessor desires to lease such space to a third party, Lessee shall have ten (10)
business days from receipt of such notice to notify Lessor in writing of
Lessee's intent to exercise its Right of First Refusal. If Lessee does not
exercise its Right of First Refusal, then Lessor may lease such space to any
third party. If Lessee elects to exercise its Right of First Refusal to lease
such space, the term for such space shall expire simultaneously with the term
of this lease, and the rent for such space shall be based on the lesser of the
then prevailing rental rates for properties of equivalent quality, size,
utility and location, with the length of the Lease term and credit standing of
Lessee to be taken into account or a third party offer, otherwise subject to
all of the same terms, covenants, and conditions of this Modification and
Ratification of Lease. Within thirty (30) days from the date of Lessee's
election to exercise its Right of First Refusal, Lessee shall execute plans and
specifications, change orders showing construction costs to be paid by Lessee,
if any, and a Modification and Ratification of this Lease to include the
additional space; otherwise Lessee's Right of First Refusal shall terminate as
to the space described in the notice from Lessor to Lessee and Lessor may lease
such space to any third party.

If Lessee does not exercise its Right of First Refusal and
Lessor leases such space to a third party, then when such third party's rights
to the space have been completely terminated, either by expiration, termination
or any other means, Lessee shall have a fifteen
<PAGE> 2
(15) day option to lease such space at the then prevailing market rental rates.
If after fifteen (15) days Lessee fails to exercise its option, said option
shall expire, and Lessee shall thereafter possess a Right of First Refusal on
such space. If Lessor desires to lease such space to a third party, Lessee
shall have ten (10) business days from receipt of such notice to notify Lessor
in writing if Lessee's intent to exercise its Right of First Refusal. If
Lessee does not exercise its Right of First Refusal, then Lessor may lease such
space to any third party. If Lessee elects to exercise its Right of First
Refusal to lease such space, the term for such space shall expire
simultaneously with the term of this lease, and the rent for such space shall
be based on the lesser of the then prevailing rental rates for properties of
equivalent quality, size, utility and location, with the length of the Lease
term and credit standing of Lessee to be taken into account or a third party
offer, otherwise subject to all of the same terms, covenants, and conditions of
this Modification and Ratification of Lease. Within thirty (30) days from the
date of Lessee's election to exercise its Right of First Refusal, Lessee shall
execute plans and specifications, change orders showing construction costs to
be paid by Lessee, if any, and a Modification and Ratification of this Lease to
include the additional space; otherwise Lessee's Right of First Refusal shall
terminate as to the space described in the notice from Lessor to Lessee and
Lessor may lease such space to any third party.

8. Lessor and Lessee hereby agree that all other terms and
conditions of the Lease Agreement shall remain the same.

Signed at Dallas, Texas, this 12th day of May, 1993.

LESSOR: Sterling Plaza Ltd., by
Sterling Projects, Inc., General Partner

BY: /s/ Larry Keim
---------------------------------------------
Larry Keim

TITLE: Vice President
------------------------------------------

LESSEE: Brigham Oil & Gas, L.P.
(A Delaware Limited Partnership)

BY: /s/ Anne L. Brigham
---------------------------------------------
Anne Brigham

TITLE: Vice President
------------------------------------------

<PAGE> 1
EXHIBIT 10.14

TWO BRIDGEPOINT LEASE AGREEMENT

By and Between

INVESTORS LIFE INSURANCE COMPANY OF NORTH AMERICA
("Landlord")

and

BRIGHAM OIL & GAS, L.P.

("Tenant")

DATED: SEPTEMBER 20, 1996
<PAGE> 2
TWO BRIDGEPOINT LEASE AGREEMENT

This Lease is entered into as of September ___, 1996, between
INVESTORS LIFE INSURANCE COMPANY OF NORTH AMERICA, a Washington corporation
("Landlord"), whose address for purposes of notice hereunder is 6300
Bridgepoint Parkway, Suite 325, Austin, Texas, 78730 and BRIGHAM OIL & GAS,
L.P., a Delaware limited partnership ("Tenant"), whose address prior to the
Commencement Date (defined in Section 2.01 hereof) is 5949 Sherry Lane, Suite
1616, Dallas, Texas 75225 and whose address after the Commencement Date shall
be 6300 Bridgepoint Parkway, Building Two, Suite , Austin, Texas, 78730.

W I T N E S S E T H:

ARTICLE 1

1.01 PREMISES. Landlord hereby leases to Tenant, and Tenant hereby
leases from Landlord, for the rent and subject to the provisions of this Lease,
the space (the "Premises") reflected on the floor plan(s) attached as Exhibit
"A" hereto, consisting of the entire fifth floor and part of the fourth floor
of the building (the "Building") known as Two Bridgepoint, located at 6300
Bridgepoint Parkway, Austin, Travis County, Texas (such Building, and
ground-level open areas and walkways appurtenant to the Building, any parking
areas and garages serving the Building, any other structure or improvement
utilized in the operation or maintenance of the Building, and the land (the
"Land") on which all such improvements are located, said Land being more
particularly described on Exhibit "B" attached hereto and made a part hereof
for all purposes, and any present or future associated underground or elevated
pedestrian tunnels or walkways being hereinafter collectively referred to as
the "Project"). Landlord and Tenant hereby agree that the Premises contain
approximately 23,619 square feet of rentable area and the Building contains
approximately 92,459 square feet of rentable area.

ARTICLE 2

2.01 TERM. Subject to the other provisions hereof, and any
exhibits hereto, this Lease shall be for a term of approximately ten (10) years
commencing on the Commencement Date (defined in Section 2.02 hereof) and
expiring on June 30, 2007 (the "Expiration Date"). Such term, as it may be
modified, is herein called the "Term." A "Lease Year" shall be the twelve
month period beginning on July 1 of each calendar year and ending on June 30 of
the following calendar year.

2.02 COMMENCEMENT. As used herein, "Commencement Date" means the
earlier to occur of: (a) July 1, 1997, or if later, the date which is ten (10)
business days after the Premises (including the Tenant Improvements described
on Exhibit "C") are substantially completed (as hereinafter defined), or would
have been substantially completed but for Tenant Delays (as defined in Exhibit
"C"), and Landlord has notified Tenant of such completion, or (b) the date
Tenant begins the occupancy of all or any part of the Premises in a reasonably

<PAGE> 3
normal manner for the conduct of Tenant's business. The parties anticipate the
Premises will be substantially complete on or about June 20, 1997.
"Substantial completion" shall mean that Landlord has received a temporary or
permanent certificate of occupancy from the City of Austin permitting Tenant's
occupancy of the Premises and that the Premises (and parking and other
improvements in the Project reasonably necessary to Tenant's use and enjoyment
of the Premises) are sufficiently complete to allow Tenant's use and occupancy
of the Premises, except for any work upon which Landlord and Tenant shall have
agreed in writing ("punch list" items), the performance of which will not,
after Tenant commences occupancy of the Premises, significantly interrupt or
interfere with Tenant's use thereof. Landlord agrees to complete any punch
list items remaining on the Commencement Date within thirty (30) days
thereafter. Within five (5) days after the Commencement Date or at any time
thereafter upon the request of Landlord, Tenant shall execute and deliver to
Landlord a declaration (in the form of Exhibit "D" hereto) specifying, among
other things, the date upon which the same occurred.

Notwithstanding anything contained in this Lease to the contrary, in
the event the Premises are not substantially completed by August 15, 1997,
Tenant shall have the option to cancel and terminate this Lease, and in such
event, Tenant shall have no further obligations to Landlord.

2.03 RENEWAL OPTIONS. Landlord hereby gives and grants to Tenant
one (1) option to renew this Lease for a period of five (5) years on the terms
and conditions set forth in Exhibit "E". The Renewal Term shall commence on
the expiration of the Term.

2.04 RIGHT OF FIRST REFUSAL. Landlord hereby grants Tenant a right
of first refusal with respect to all remaining space on the fourth floor of Two
Bridgepoint as set forth in "Exhibit "F". This right of first refusal is in
effect only during the Primary Term and terminates on the expiration of the
Primary Term. Further, as more particularly provided in Exhibit "F", the right
of first refusal will not obligate Landlord to offer additional space on the
fourth floor if (1) Landlord delivers the Occupancy Notice, as defined in
Exhibit "F" or (2) delivers the Affiliate Lease Notice, as defined in Exhibit
"F", however, the right of first refusal will be reinstated automatically with
respect to all or any portion of the Refusal Space later released by Landlord
or Landlord's Affiliate, as applicable, during the Primary Term.

2.05 EXPANSION OPTION. In the event that Landlord (i) fails to
deliver the Occupancy Notice or the Affiliate Lease Notice to Tenant as
required in Exhibit "F" or (ii) delivers the Occupancy Notice or the Affiliate
Lease Notice to Tenant but Landlord or Landlord's Affiliate does not occupy at
least 40,000 rentable square feet of space in the Building , then Landlord
hereby gives and grants to Tenant an expansion option ("Expansion Option") on
the terms and conditions set forth in Exhibit "G". In the event that Landlord
delivers the Occupancy Notice or the Affiliate Lease Notice to Tenant as
required in Exhibit "F" and Landlord or Landlord's Affiliate does occupy at
least 40,000 rentable square feet of space in the Building, then Landlord
hereby gives and grants to Tenant a limited expansion option ("Limited
Expansion Option") on the terms and conditions set forth in Exhibit "G".

<PAGE> 4
2.06 CANCELLATION OPTION. Notwithstanding the foregoing, Tenant
shall have the right to cancel and terminate this Lease as of July 1, 2002, by
giving Landlord written notice of such election no later than July 1, 2001;
provided, however, in order for Tenant to cancel and terminate this Lease,
Tenant must pay, prior to July 1, 2002, liquidated damages to Landlord equal to
the unamortized Tenant Improvement Allowance (as defined in Exhibit "C") used
by Tenant, any unamortized Additional Tenant Improvement Allowance (also as
defined in Exhibit "C") used by Tenant and the unamortized cost of leasing
commissions incurred by Landlord in connection with this Lease.

ARTICLE 3

3.01 BASE RENT. Tenant, in consideration for this Lease, agrees to
pay to Landlord a base rental ("Base Rent") of $23.00 per year for each square
foot of rentable area agreed by Landlord and Tenant to be within the Premises
for Lease Years one (1) through five (5) and $24.00 per year for each square
foot of rentable area agreed by Landlord and Tenant to be within the Premises
for Lease Years six (6) through ten (10). The Base Rent shall be payable in
equal monthly installments, the amount of which shall be determined by dividing
the total rent for each respective Lease Year by twelve (12), and payable at
Landlord's address herein provided in legal tender of the United States of
America, without notice, demand, counterclaim, set-off or abatement (except as
expressly provided in this Lease), in advance on the first day of each calendar
month throughout the Term, except that the first such monthly installment is
due upon the date of execution of this Lease by Tenant. Notwithstanding the
foregoing, if the Commencement Date is a date other than the first day of a
calendar month, then the rent for the Base Rent for the first month of this
Lease shall be a sum equal to the Base Rent specified for the first full
calendar month as herein provided, times a fraction, the numerator of which
equals the number of days from the Commencement Date to the end of the calendar
month during which the Commencement Date falls and the denominator of which
equals the number of days in the same calendar month.

3.02 TENANT'S PERCENTAGE SHARE OF OPERATING EXPENSES. In addition
to the Base Rent, Tenant, as additional consideration for this Lease, agrees to
pay to Landlord Tenant's Percentage Share (defined in Section 3.03 hereof) of
Operating Expenses (defined in Section 3.04 hereof) annualized for each
calendar year during the Term, which exceeds $7.50 per rentable square foot per
year ("Expense Stop"). On or before the Commencement Date and thereafter on or
before the first day of each calendar year of the Term, Landlord shall provide
to Tenant the Estimated Operating Expense (defined in Section 3.03 hereof) for
the upcoming calendar year. Tenant shall pay in advance on the first day of
each calendar month during the Term, installments equal to one-twelfth (1/12)
of Tenant's Percentage Share of Estimated Operating Expenses annualized for
each calendar year which exceeds the Expense Stop. Within one hundred fifty
(150) days after the end of each calendar year during the Term, Landlord shall
furnish to Tenant a statement certified by Landlord of the Actual Operating
Expenses for the immediately preceding calendar year. If Tenant's Percentage
Share of Estimated Operating Expenses which exceeds the Expense Stop paid to
Landlord during the previous calendar year exceeds Tenant's Percentage Share of
Actual Operating Expense which exceeds the Expense Stop

3
<PAGE> 5
for such year, then Landlord shall refund the difference to Tenant at the time
Landlord furnishes the statement of the Actual Operating Expense. Otherwise,
within fifteen (15) days after Landlord furnishes such statement to Tenant,
Tenant shall make a lump sum payment to Landlord equal to the positive
difference between Tenant's Percentage Share of the Actual Operating Expense
which exceeds the Expense Stop for the preceding calendar year over Tenant's
Percentage Share of the Estimated Operating Expense which exceeds the Expense
Stop paid by Tenant for the preceding calendar year. As used in this Lease the
term "Rent" shall refer collectively to the Base Rent and Tenant's Percentage
Share of Operating Expenses in excess of the Expense Stop. If the Commencement
Date is on a day other than the first day of the month, then Tenant shall be
required to pay only a pro rata portion of the installment of Rent due for such
month.

Landlord will cause adequate books and records to be maintained to
permit Tenant to verify computations of Operating Expenses and other amounts
relevant to Tenants obligations under this Lease; provided, Landlord shall not
be required to maintain any books and records concerning any payment due
hereunder for more than 2 years after such payment is due. Further, Landlord
shall permit Tenant or Tenant's representative to audit such books and records
during normal business hours and shall assist in way reasonably required for
such audits. Landlord shall also furnish explanations in reasonable detail if
requested by Tenant of any computation made under this Lease. All
determinations required or permitted of Landlord concerning payments for
Operating Expenses and other charges due hereunder shall be subject to
verification by Tenant. If any such determinations are found to be incorrect,
an adjustment will be promptly made between Landlord and Tenant to correct any
underpayments or overpayments resulting from such incorrect determinations. If
an audit of Operating Expenses for any calendar year reveals that Tenant was
overcharged under this Section 3.02 by more than ten percent (10%) for that
year, Landlord will reimburse Tenant for the cost of such audit. However,
notwithstanding that a disagreement may arise between Tenant and Landlord about
any determination required or permitted of Landlord concerning rents and other
charges due hereunder, Tenant shall continue to pay all rents and other charges
as herein provided pending resolution of such determination.

3.03 TENANT'S PERCENTAGE SHARE. For purposes of this Lease, the
term "Tenant's Percentage Share" shall mean a percentage which is equal to the
number of rentable square feet contained in the Premises divided by the total
number of rentable square feet contained in the Building of the Premises are a
part.

3.04 OPERATING EXPENSES. "Operating Expenses" shall mean and
include all amounts, expenses, and costs of whatsoever nature incurred because
of or in connection with the ownership, management, operation, repair,
maintenance or security of the Building and Landlord's personal property which
may be utilized in connection therewith. Without limiting the foregoing,
Operating Expenses will include a share (equal to the rentable square footage
of the Building divided by the total rentable square footage of all buildings
in the Project from time to time) of any costs and expenses incurred by
Landlord which are for the benefit of the Project generally, rather than any
particular Building. Thus, for example, "Operating Expenses" will

4
<PAGE> 6
include such a share of any cost of providing health club facilities for all
occupants of the Project (in excess of any revenues generated by such
facilities) and of any cost of providing security throughout the Project, if
Landlord determines that such costs cannot be otherwise more appropriately
charged to each building. If, however, greater security is required for an
occupant of a particular building in the Project (for example, Motorola), the
cost of such greater security will not be treated as a cost for the benefit of
the Project generally under this provision.

Notwithstanding anything to the contrary herein, Operating Expenses
shall not include, and Tenant shall not be required to pay or reimburse
Landlord for any part of: property management fees in excess of (4%) of gross
rent (subject to this limitation, Tenant agrees that Operating Expenses may
include such fees to an affiliate of Landlord); the cost of capital
improvements or depreciation (except as expressly permitted by the next
sentence); interest and principal payments on mortgages, ground lease rentals
and other non-operating debts of Landlord; specific costs for special items or
services billed specific tenants (or that would be billed to another tenant if
its lease required payments in addition to base rent on substantially the same
terms and conditions as this Lease requires of Tenant); costs of correcting
construction or design defects or violations of law existing as of the
Commencement Date; legal fees or other costs incurred because of any lease
dispute between Landlord and other tenants; income, excess profits, franchise,
transfer, estate, inheritance or rent taxes; costs paid by insurance, recovery
upon construction warranties or other sources (excluding reimbursement by
tenants for Operating Expenses); leasing commissions, attorneys' fees,
advertising expenses, and other expenses incurred in connection with leasing,
selling or conveying any interest in the Project or the land associated
therewith; costs of repairs or other work occasioned by fire, wind storm or
other casualty or necessitated by condemnation. Operating Expenses shall,
however, include:

(A) The annual cost of all capital improvements made subsequent to
the final completion of the Building (including the Premises)
which, although capital in nature, can reduce the normal
operating costs of the Project, as amortized in accordance
with generally accepted accounting principles, consistently
applied; provided that such amortization shall not be more in
any calendar year than Landlord's reasonable estimate of the
resulting savings in other Operating Expenses.

(B) The annual cost of all capital improvements made in order to
comply with any statutes, rules, regulations, or directives
enacted or promulgated by any governmental authority after the
effective date of this Lease, as amortized in accordance with
generally accepted accounting principles, consistently
applied.

Although rent taxes shall not be included in Operating Expenses, if
any rent taxes become payable on the rents due to Landlord hereunder, Tenant
shall reimburse Landlord for such taxes upon request.

Operating Expenses shall be determined on an accrual basis in
accordance with generally accepted accounting principles consistently applied.
The "Estimated Operating Expense" shall

<PAGE> 7
equal the Landlord's reasonable estimate of Operating Expenses for the
applicable calendar year. Landlord's statement of the Estimated Operating
Expense shall control for the year specified in such statement and for each
succeeding year during the Term until Landlord provides a new statement of the
Estimated Operating Expense. The "Actual Operating Expense" shall equal the
operating expenses actually incurred for the applicable calendar year.
Notwithstanding any provision contained herein to the contrary, if less than
95% of the total square feet of rentable area in the Building is occupied by
tenants or Landlord is not supplying services to 95% of the total square feet
of rentable area of the Building at any time during any calendar year,
Operating Expenses for such calendar year shall be determined to be an amount
equal to the like expense which would normally be expected to be incurred had
such occupancy been 95% of the Building's total square feet of rentable area
and had Landlord been supplying services to 95% of the Building's total square
feet of rentable area throughout such calendar year.

3.05 TENANT IMPROVEMENTS. Prior to the applicable Commencement
Date, Landlord shall, on the terms and conditions set forth in Exhibit "C"
construct the improvements desired by Tenant to complete the Premises for
Tenant's occupancy (the "Tenant Improvements").

3.06 COMPLETION OF TENANT IMPROVEMENTS. Landlord agrees that the
Premises shall be substantially completed by July 1, 1997, plus any additional
time required for substantial completion because of Tenant Delays. Landlord
acknowledges that Tenant will incur certain holdover rent, penalties and costs
at its current lease space if Tenant is unable to occupy the Premises by July
15, 1997 (the "Penalty Date"). In the event the Premises are not substantially
completed by the Penalty Date, Landlord will pay Tenant's actual holdover rent,
penalties and costs incurred by Tenant, not to exceed $700.00 per day for each
day the Premises are not substantially completed after the Penalty Date.

ARTICLE 4

4.01 USE. Tenant shall use and occupy the Premises only for office
purposes and for no other purposes. Tenant shall not do or permit anything to
be done in the Premises or authorize anything to be done in other parts of the
Project, nor shall Tenant bring or keep anything in the Project, that will in
any way increase the existing rate of or affect any fire or other insurance
upon the Project or any of its contents, or cause cancellation of any insurance
policy covering the Project or any part thereof or any of its contents. Tenant
shall not do or permit anything to be done in the Premises or authorize
anything to be done in other parts of the Project that will unreasonably or
improperly obstruct or interfere with the rights of other tenants or occupants
of the Project or injure or annoy them or tend to lower the first class
character of the building or create unreasonable elevator loads or otherwise
interfere with standard Building operations. Tenant shall not do or permit
anything to be done in the Premises or authorize anything to be done in other
parts of the Project that would constitute a nuisance. Tenant shall not commit
or suffer to be committed any waste in or upon the Premises. Subject to the
rights of Tenant under other provisions of this Lease, Tenant shall not use the
Premises or authorize anything to be done in other parts of the Project that
will in any way conflict with

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<PAGE> 8
any private restrictive covenant, law, statute, ordinance or any reasonable
rule or regulation of Landlord or any governmental or quasi-governmental
authority now in force or that may hereafter be enacted or promulgated.

ARTICLE 5

5.01 LANDLORD'S SERVICES. Provided Tenant is not in default
hereunder, Landlord shall, at Landlord's expense, except as provided to the
contrary in this Lease, furnish to Tenant the following services, in keeping
with the standards of a first class suburban office building in Austin, Texas:

(a) Subject to curtailment as required by governmental laws, rules
or regulations, air conditioning and central heat, in season,
at temperatures between 67 and 78 degrees F., during all
normal Building hours. (Normal Building hours will be 7:00
a.m. through 6:00 p.m. on weekdays and 8:00 a.m. through 12:00
p.m. on Saturdays, exclusive of normal business holidays.
Normal business holidays for purposes of this Lease shall be
the days reasonably designated as such by Landlord from time
to time (but not more than nine days in any calendar year),
which days may include, without limitation, New Year's Day,
Martin Luther King Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, the Friday
following Thanksgiving Day and Christmas Day. If in the case
of any holiday described herein a different day shall be
observed than the respective day described, then the day which
constitutes the day observed by national banks in Austin,
Texas, on account of such holiday shall constitute the holiday
under this Lease.) Notwithstanding the foregoing, Landlord
acknowledges that Tenant shall have approximately 1,000 square
feet designated as "Veritas" space which shall have 24 hour a
day, seven days a week air conditioning and central heat, in
season, and such "Veritas" space shall be separately
submetered and billed separately to Tenant. To the extent
contemplated by the Drawings approved by Landlord and Tenant
as described in Exhibit "C", an emergency power backup system
may be installed for the "Veritas" space, and any such system
will be maintained at the expense of Tenant throughout the
Term.

(b) Janitorial services in the Premises and public portions of the
Building for all days except Saturdays, Sundays, and normal
business holidays.

(d) Normal and customary routine maintenance, and any repairs
required from time to time, for all public, structural, and
exterior portions of the Project and for the HVAC and other
Building systems.

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<PAGE> 9
(e) Electric lighting service for all public portions of the
Project.

(f) Reasonably adequate, non-exclusive automatic passenger
elevator service at all times for access to and egress from
the Premises. Freight elevator service, in common with other
tenants, shall be provided during reasonable business hours as
prescribed by Landlord, exclusive of Saturdays, Sundays, and
normal business holidays.

(g) Electric energy that Tenant shall require for normal office
equipment such as typewriters, dictation machines,
calculators, personal computers, copying machines and other
machines of a similar electrical consumption, and Building
Standard (defined in Exhibit "C" attached hereto) lighting in
the Premises. Without Landlord's prior written consent,
Tenant shall not be entitled to employ lighting on the
Premises that consumes electrical current in excess of
Building Standard lighting nor utilize space heaters nor
utilize any office equipment that requires a voltage of other
than 120 volts single phase or an electric capacity greater
than any limitations on capacity contemplated in the Drawings
approved by Landlord and Tenant as described in Exhibit "C".

(h) Building security to encourage compliance with the Rules and
Regulations (defined in Section 15.09 hereof) and to limit
after-hour access to the Building; provided, however, Landlord
shall have no responsibility to prevent, and shall not be
liable to Tenant for, and shall be indemnified by Tenant
against, liability or loss to Tenant, its agents, employees
and visitors arising out of losses due to theft, burglary, or
damage or injury to persons or property caused by persons
having or gaining access to the Building or the Premises,
whether or not caused by Landlord's negligence, and Tenant
hereby releases Landlord from all liability relating thereto.
Landlord agrees to work with Tenant to develop such other
mutually acceptable security programs to provide that the
Premises can be accessed solely by Tenant after Tenant's
normal business hours.

(i) Window washing services for the outside portions of the
Building at least one (1) time per calendar year.

(j) Landlord will use reasonable efforts to cause a restaurant,
deli or other retail food service provider and a health
facility to open within a reasonable time after the
Commencement Date at Bridgepoint Square and to remain open (or
to be replaced) throughout the remainder of the Term.

(k) Landlord will provide picnic tables for outdoor luncheon
purposes at Bridgepoint Square, in such locations as
determined by Landlord.

(l) For the non-exclusive use of Tenant's employees, Landlord
shall provide a basketball goal on top of the parking garage
adjacent to the Building or at another

8
<PAGE> 10
suitable location designated by Landlord and a men's rest room and a
women's rest room with showers in the Building. Without limiting
Landlord's right to choose a suitable location for the facilities
described in this clause, any or all such facilities may be provided
as part of a health facility described in clause (j) above.

5.02 ADDITIONAL SERVICE COST. Tenant shall pay Landlord, upon
demand, such additional amounts as are necessary to recover additional costs
incurred by Landlord in performing or providing janitorial, maintenance,
security, or other services or requirements of Tenant (and in paying additional
taxes) as to any non-Building Standard installations in the Premises; provided,
none of Tenant's Improvements will be deemed as non-Building Standard for
purposes of this Lease unless and except to the extent that Landlord so
notifies Tenant thereof when the plans for Tenant Improvements are finalized
and before construction thereof commences.

Tenant shall pay Landlord, upon demand, monthly as billed charges
(equal to Landlord's actual or reasonably estimated cost) for providing
off-hour and nonstandard air conditioning, heating and electricity, but in no
event less than $20.00 per hour per zone; provided, however, this provision
will not excuse Tenant's excessive use or consumption of heating, air
conditioning and/or electrical services in violation of Section 5.01 hereof.

5.03 SERVICE INTERRUPTION. To the extent any of the services
described above require electricity, gas, water or other services supplied by
public utilities, Landlord's covenants hereunder shall impose on Landlord only
the obligation to use its good faith efforts to cause the applicable public
utilities to furnish the same. Any failure or defect in the services described
above shall not be construed as an eviction of Tenant nor entitle Tenant to any
reduction, abatement, offset, or refund of Rent or to any damages from
Landlord. Landlord shall not be in breach or default under this Lease,
provided Landlord uses reasonable diligence during normal business hours to
restore any such failure or defect after Landlord receives written notice
thereof.

Notwithstanding the foregoing, however, and irrespective of any rights
Landlord may claim under Section 15.13, in the event of any interruption,
reduction or discontinuance of utilities or services described in this Article
5 or of parking or repairs required of Landlord by other provisions of this
Lease, which renders Tenant unable to use and enjoy any significant portion of
the Premises (the "Affected Portion") in a reasonably normal manner, Tenant
shall have the following rights:

(1) If the interruption, reduction or discontinuance occurs for
reasons within Landlord's control (a "Controllable
Interruption"), and if it continues for 30 consecutive days
after Landlord is notified thereof or for any 45 of the 90
days after Landlord is notified thereof, Tenant shall be
entitled to treat the Controllable Interruption as an eviction
from the Affected Portion.

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<PAGE> 11
(2) If the interruption, reduction or discontinuance occurs
because of applicable laws or any happening beyond the control
of Landlord, other than financial inability (an
"Uncontrollable Interruption"), then Tenant shall be entitled
to an abatement of rent and other charges due hereunder with
respect to the Affected Portion beginning on the tenth (10th)
day after Landlord is notified of the Uncontrollable
Interruption, which abatement shall continue thereafter until
the Uncontrollable Interruption is cured or Landlord otherwise
renders the Affected Portion suitable for use by Tenant in a
reasonably normal manner. Further, if any such Uncontrollable
Interruption continues with the result that Tenant is not able
to use the Affected Portion in a reasonably normal manner for
more than sixty (60) days after Landlord is notified of the
Uncontrollable Interruption, Tenant may notify Landlord of
Tenant's intention to terminate this Lease. If Landlord fails
to eliminate the Uncontrollable Interruption or to otherwise
render the Affected Portion again suitable for use by Tenant
in a reasonably normal manner within an additional thirty (30)
days after receiving any such notice of Tenant's intention to
terminate, then Tenant shall be entitled to terminate this
Lease by giving Landlord a notice of termination.

ARTICLE 6

6.01 ALTERATIONS. Tenant shall not make or allow to be made any
alterations, installations, additions or improvements in or to the Premises, or
place safes, vaults or other heavy furniture or equipment within the Premises,
without Landlord's prior written consent. Such consent by Landlord will not be
unreasonably withheld for interior, nonstructural alterations to the Premises
that do not require modifications to the Building HVAC or other systems. All
alterations, installations, additions or improvements, other than movable
furniture and movable trade fixtures, made by Tenant to the Premises shall
remain upon and be surrendered with the Premises and become the property of
Landlord at the expiration or termination of this Lease or the termination of
Tenant's right to possession of the Premises; provided, however, that Landlord
may require Tenant, at Tenant's cost, to remove any or all of such items made
by Tenant that are not Building Standard upon the expiration or termination of
this Lease or the termination of Tenant's right to possession of the Premises.
Tenant, at its sole cost and prior to the expiration or termination of this
Lease, shall remove all of Tenant's property from the Premises and make, or
reimburse Landlord for the cost of, all repairs to the Premises and/or Project
for damage resulting from such removal. All work shall be completed promptly
and in a good and workmanlike manner and shall be performed in such a manner
that no mechanic's, materialman's or other similar liens shall attach to
Tenant's leasehold estate, and in no event shall Tenant permit, or be
authorized to permit, any such liens or other claims to be asserted against
Landlord or Landlord's rights, estate and interests with respect to the Project
or this Lease. Landlord may require, at Tenant's sole cost and expense, a lien
and completion bond in an amount equal to the estimated cost of any
improvements, additions or alterations Tenant proposes to make in the Premises.

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<PAGE> 12
6.02 TENANT REPAIRS. By taking possession of the Premises, Tenant
shall be deemed to have accepted the Premises as being in good, sanitary order,
condition and repair, subject to punch list items and latent defects. Tenant
shall, at Tenant's sole cost and expense, keep the Premises in good condition
and repair, excepting damage thereto by fire or other casualty or resulting
from causes beyond the reasonable control of Tenant and further excepting
ordinary wear and tear. Other than as herein provided to the contrary with
respect to damages resulting from fire or other insurable casualties, any
injury or damage to the Premises or Project, or the appurtenances or fixtures
thereof, caused by or resulting from the negligent acts or omissions of or the
intentional misconduct of Tenant or Tenant's employees, servants, agents,
invitees, assignees, or subtenants shall be repaired or replaced by Tenant, or
at Landlord's option by Landlord, at the expense of Tenant. If Tenant fails to
maintain the Premises or fails to repair or replace any damage to the Premises
or Project for which it is responsible by the terms of this Lease, Landlord
may, but shall not be obligated to, cause such maintenance, repair or
replacement to be done, as Landlord deems necessary, and Tenant shall
immediately pay to Landlord all costs related thereto plus a charge for
overhead of 10% of such costs.

6.03 LANDLORD REPAIRS. Except as stipulated herein, Landlord shall
not be required to make any improvements to or repairs of any kind or character
to the Premises during the Term. However, notwithstanding any provisions of
this Lease to the contrary, all repairs, alterations or additions to the base
Building or its systems (as opposed to those involving only Tenant's leasehold
improvements), and all repairs, alterations or additions to Tenant's
non-Building Standard leasehold improvements which affect the Building's
structural components or major mechanical, electrical or plumbing systems in
the Building, shall be made by Landlord or its contractor only. Further, to
the extent that other provisions of this Lease would make any such repairs,
alterations or additions the responsibility of Tenant, Tenant shall pay the
cost thereof (including an additional charge of 10% of actual direct costs for
Landlord's overhead), except as otherwise provided in Exhibit "C" attached
hereto.

ARTICLE 7

7.01 LANDLORD INSURANCE. Landlord shall fully insure the Project
against fire and other casualty and shall maintain comprehensive general
liability and other insurance in such amounts as may be required by Landlord's
mortgagee, or in such greater amounts as Landlord, in its sole discretion, may
deem appropriate. The cost of such insurance, including any reasonable
deductible paid thereunder by Landlord, shall be an "Operating Expense" as
defined in Section 3.03 hereof. Such insurance shall be for the sole benefit
of Landlord and, if required, Landlord's mortgagee. If the annual premiums to
be paid by Landlord exceed the standard rates because of Tenant's operations
within or contents of the Premises or because improvements to the Premises are
beyond Building Standard, Tenant shall promptly pay the excess amount of the
premium upon request by Landlord (and if necessary, Landlord may allocate the
insurance costs of the Building to give effect to this sentence).

7.02 TENANT INSURANCE. Tenant shall, at Tenant's expense, fully
insure its property located in the Premises against fire and other casualty and
shall maintain comprehensive

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<PAGE> 13
general liability insurance insuring Landlord and Tenant against any liability
arising out of ownership, use, occupancy or maintenance of the Premises and all
areas appurtenant thereto, including contractual liability insurance (with
respect to Section 7.04 hereof), with insurance companies approved by Landlord
and with limits of liability of at least $2,000,000 in each occurrence for
Bodily Injury and Property Damage combined and $2,000,000 general aggregate for
Bodily Injury and Property Damage combined with the endorsement of
comprehensive general liability CG-2504. Tenant shall cause Landlord to be
named as an additional insured under such general liability policies and shall,
not less than twenty (20) days prior to (a) the Commencement Date, and (b) the
expiration of old policies, furnish Landlord with certificates of insurance
reasonably satisfactory to Landlord. The limit of such insurance shall not,
however, limit the liability of Tenant hereunder. Tenant may carry such
insurance under a blanket policy, provided such insurance has a Landlord's
protective liability endorsement attached thereto. If Tenant fails to procure
and maintain said insurance, Landlord may, but shall not be required to,
procure and maintain same, but at the expense of Tenant. No policy shall be
cancelable or subject to reduction of coverage except after thirty (30) days
prior written notice to Landlord.

7.03 WAIVER OF SUBROGATION. WHENEVER (A) ANY LOSS, COST, DAMAGE OR
EXPENSE RESULTING FROM FIRE, EXPLOSION OR ANY OTHER CASUALTY OR OCCURRENCE IS
INCURRED BY EITHER OF THE PARTIES TO THIS LEASE IN CONNECTION WITH THE PREMISES
OR THE PROJECT, AND (B) SUCH PARTY IS THEN COVERED (OR IS REQUIRED UNDER THIS
LEASE TO BE COVERED) IN WHOLE OR IN PART BY INSURANCE WITH RESPECT TO SUCH
LOSS, COST, DAMAGE OR EXPENSE, THEN NOTWITHSTANDING ANYTHING TO THE CONTRARY
HEREIN CONTAINED, THE PARTY SO INSURED (OR REQUIRED TO BE INSURED), FOR ITSELF
AND ANY INSURER OR ANYONE ELSE THAT MIGHT OTHERWISE CLAIM THROUGH IT BY WAY OF
SUBROGATION, HEREBY RELEASES THE OTHER PARTY (EVEN IF THE OTHER PARTY IS
NEGLIGENT! FROM ANY LIABILITY THE OTHER PARTY WOULD OTHERWISE HAVE ON ACCOUNT
OF SUCH LOSS, COST, DAMAGE.

7.04 INDEMNITY. Tenant hereby indemnifies and holds Landlord
harmless from and against any and all claims arising from Tenant's use of the
Premises for the conduct of its business or from any activity, work or other
thing done by Tenant on or about the Project and shall further indemnify and
hold harmless Landlord from and against any and all claims arising from any
breach or default in the performance of any obligation on Tenant's part to be
performed under the terms of this Lease, or arising from any negligence or
intentional misconduct of Tenant, or any officer, agent, employee, guest or
invitee of Tenant, and from and against all costs, attorney's fees, expenses
and liabilities incurred in or related to any such claim or any action or
proceeding brought thereon. Tenant, as a material part of the consideration to
Landlord, hereby assumes all risk of damage to property or injury to persons
including death in, upon or about the Premises, from any cause, including
without limitation, Landlord's negligence, but except for such damage or injury
caused by Landlord's gross negligence, and Tenant hereby waives all claims in
respect thereof against Landlord.

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<PAGE> 14
ARTICLE 8

8.01 CASUALTY. Tenant shall promptly give Landlord written notice
of any fire or other casualty occurring within the Premises. If the Premises
or other parts of the Building or Project reasonably required for Tenant's use
and quiet enjoyment of the Premises are damaged by fire or other casualty,
then, subject to the following provisions of this Article, Landlord shall
promptly repair the damage. If, however, the damage (a) is not covered by
insurance carried by Landlord hereunder, (b) is covered by insurance carried by
Landlord hereunder, but Landlord's mortgagee requires that proceeds of such
insurance be used to retire the mortgage debt, (c) is to such an extent that
the cost of repairs will be greater than 10% of the then full replacement cost
of the Building, or (d) occurs during the last 12 months of the then effective
Term of this Lease, then Landlord shall have the option (i) to repair the
damaged Premises and any other damaged parts of the Building or Project
reasonably necessary to Tenant's use and quiet enjoyment of the Premises to
substantially the same condition as immediately prior to such fire or other
casualty, or (ii) to terminate this Lease by so notifying Tenant within sixty
(60) days after the date of such damage, such termination to be effective as of
the date of the fire or other casualty causing the damage. The Rent required
to be paid hereunder shall be abated in proportion to the portion of the
Premises, if any, which is rendered untenantable by fire or other casualty
hereunder until repairs specified in clause (i) of the preceding sentence are
completed. Other than such rental abatement, no damages, compensation or
claims shall be payable by Landlord for loss of the use of the whole or any
part of the Premises, Tenant's personal property, or any inconvenience, loss of
business, or annoyance arising from any such repair and reconstruction.
Notwithstanding the foregoing, Landlord shall not be required to repair or
replace any furniture, furnishings, or other personal property that Tenant may
be entitled to remove from the Premises or any alterations to the Premises
constructed and installed by or for Tenant pursuant to Section 6.01 hereof or
any installations in excess of Building Standard.

ARTICLE 9

9.01 CONDEMNATION. If more than a "substantial portion of the
Premises" (as hereinafter defined) should be taken for any public or
quasi-public use, by right of eminent domain or otherwise, or should be sold in
lieu of condemnation, then either party hereof shall have the right, at its
option, to terminate this Lease as of the date when physical possession of the
Premises is taken by the condemning authority. If less than a substantial
portion of the Premises is so taken or sold, the Rent payable hereunder shall
be abated in proportion to the portion of the Premises which is rendered
untenantable by such condemnation, and Landlord shall, subject to the following
provisions of this Article, promptly restore the Premises and the appurtenances
thereto to substantially its former condition. As used herein, a "substantial
portion of the Premises" will mean (1) more than 20% of the rentable are of the
Premises itself, (2) any parking areas or other appurtenances to the Premises
in the Project, without which Tenant cannot continue to operate its business in
a reasonably normal manner, (3) any part of the Project, after the taking of
which (or sale in lieu thereof), Landlord is unable to promptly restore the
remainder of the Project for any reason (including any shortage of condemnation
or sales proceeds available to Lessor or any refusal of Landlord's mortgagee,
ground lessor or

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<PAGE> 15
other secured party, to give consents necessary for such restoration). If any
substantial part of the Project other than the Premises may be so taken or
sold, Landlord shall have the right at its option to terminate this Lease as of
the date when physical possession of such part of the Project is taken by the
condemning authority. All amounts awarded upon taking of any part or all of
the Project or the Premises shall belong to Landlord and Tenant shall not be
entitled to, and expressly assigns all claims, rights and interests to, any
such compensation to Landlord.

ARTICLE 10

10.01 ENTRY. Landlord, its agents, employees and representatives,
shall have the right to enter the Premises at any time after reasonable notice
to Tenant under the circumstances (which notice may be oral and not in
compliance with Section 15.08 hereof, but no notice shall be required in the
case of routine maintenance or an emergency) to show the Premises to
prospective lenders or prospective purchasers or, within the last six months of
the Term, prospective tenants or for any purpose that Landlord may reasonably
deem necessary for the operation and maintenance of the Project. Provided any
such entry is done in a manner that does not unnecessarily interfere with
Tenant's use or enjoyment of the Premises, Tenant hereby waives any claim for
damages or for any injury or inconvenience to or interference with Tenant's
business, any loss of occupancy or quiet enjoyment of the Premises, and any
other loss occasioned thereby. For each of the aforesaid purposes, Landlord
shall at all times have and retain a key with which to unlock all of the doors
in, upon and about the Premises, excluding Tenant's vaults, safes and files.
Landlord shall have the right to use any and all means which Landlord may deem
proper to open the doors in, upon and about the Premises in an emergency in
order to obtain entry to the Premises without liability to Tenant, except for
any failure to exercise due care for Tenant's property.

ARTICLE 11

11.01 SUBORDINATION. Subject to the nondisturbance provisions in
the next Section, this Lease is and shall be subject and subordinate to any and
all ground or similar leases affecting the Project, and to all mortgages, deeds
of trust, and security agreements that may now or hereafter encumber or affect
the Project or any interest of Landlord therein and/or the contents of the
Building, and to any advances made on the security thereof and to any and all
increases, renewals, modifications, consolidations, replacements and extensions
of any such leases, mortgages, deeds of trust and/or security agreements. This
clause shall be self-operative and no further instrument of subordination need
be required by any owner or holder of such ground lease, mortgage, deed of
trust or security agreement. Tenant agrees to execute and return any estoppel
certificate, consent or agreement reasonably requested by any such lessor,
mortgagee, trustee or secured party in connection with this Section within ten
(10) days after receipt of same; provided the applicable certificate, consent
or agreement is not inconsistent with Tenant's rights under this Lease. Any
breach of the preceding sentence by Tenant shall constitute a "Default"
hereunder. If any mortgagee of Landlord secured by a lien on the Project, any
lessor to Landlord under a ground lease of the Project, or any secured party
under a security agreement encumbering the interest of Landlord shall request
it and provide Tenant with an

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address for notices, Tenant shall provide to such mortgagee, lessor or secured
party written notice of any default or breach by Landlord at least thirty (30)
days prior to the exercise by Tenant of any rights and/or remedies of Tenant
hereunder arising out of such default or breach.

11.02 NONDISTURBANCE AND ATTORNMENT. If any ground or similar such
lease, mortgage, deed of trust or security agreement is enforced by the ground
lessor, the mortgagee, the trustee, or the secured party, Tenant shall, upon
request, attorn to the lessor under such lease or the mortgagee or purchaser at
such foreclosure sale, or any person or party succeeding to the interest of
Landlord as a result of such enforcement, as the case may be, and execute
instrument(s) confirming such attornment; provided, however, that regardless of
whether this Lease was approved and accepted in writing by such lessor,
mortgagee, trustee or secured party, Tenant's attornment and the rights of the
lessor, mortgagee, trustee or secured party (or anyone else claiming through
them) shall be conditioned upon the agreement by such successor to Landlord's
interest not to disturb Tenant's possession or other rights hereunder during
the Term so long as Tenant performs its obligations under this Lease. In the
event of such enforcement and upon Tenant's attornment as aforesaid, Tenant
will automatically become the tenant of the successor to Landlord's interest
without change in the terms or provisions of this Lease; provided, however,
that such successor to Landlord's interest shall not be (a) bound by any
payment of Rent for more than one month in advance (except prepayments for
security deposits, if any), or (b) bound by any amendments or modifications of
this Lease made without the prior written consent of the applicable mortgagee,
ground lessor, trustee or secured party after Tenant has been notified of its
name and address, or (c) subject to liability or offset for any damages Tenant
may claim because of a default by Landlord hereunder prior to the date
Landlord's interest in the Building is conveyed to such successor of Landlord.

11.03 QUIET ENJOYMENT. Tenant, on paying the Rent and keeping and
performing the conditions and covenants herein contained, shall and may
peaceably and quietly enjoy the Premises for the Term, subject to Sections
11.01 and 11.02, all applicable laws and other governmental and legal
requirements and the provisions of this Lease. It is understood and agreed
that this covenant and any and all other covenants of Landlord contained in
this Lease shall be subject to the penultimate sentence of Section 15.07.

ARTICLE 12

12.01 ASSIGNMENT AND SUBLETTING. Tenant shall not, voluntarily, by
operation of law, or otherwise, assign, transfer, mortgage, pledge, or encumber
this Lease or sublease the Premises or any part thereof, or suffer any person
other than Tenant, its employees, agents, servants and invitees to occupy or
use the Premises or any portion thereof, without the express prior written
consent of Landlord. Any attempt to do any of the foregoing without such
written consent shall be null and void and of no effect. If Tenant so requests
Landlord's consent, said request shall be in writing specifying the identity of
the proposed transferee, the duration of said desired sublease or assignment,
the date same is to occur, the exact location of the space affected thereby and
the proposed rentals on a square foot basis chargeable thereunder, and shall be
submitted to Landlord at least fifteen (15) days in advance of the date on
which Tenant desires

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to make such assignment or sublease or allow such occupancy or use. Upon such
request Landlord may, except as otherwise provided by the following provisions
in this Article, (a) grant such consent subject to Landlord's approval of the
assignee, transferee, subtenant, or mortgagee, or (b) deny such consent. If
Landlord does not give such consent in writing within fifteen (15) days of the
date such consent is requested, then Landlord's consent shall be deemed to have
been denied. In no event may Tenant assign this Lease or sublease the Premises
or any portion thereof to any party whose operations in the Project would not
be in keeping with, or would detract from, the operations of other tenants in
the Project.

Landlord's consent shall not be unreasonably withheld to any proposed
assignment or subletting by Tenant; provided, however, Landlord shall not be
required to give its consent to a sublease or assignment that would result in a
breach by Landlord of any of its lease obligations to other tenants. No
consent of Landlord will be required because of any change in the ownership,
directly or indirectly, of Tenant itself.

In any situation in which Landlord consents to an assignment or
sublease hereunder, Tenant shall promptly deliver to Landlord a fully executed
copy of the final sublease agreement or assignment instrument and all ancillary
agreements relating thereto. No assignment shall be effective unless the
assignee has agreed within the assignment instrument to assume the obligations
of Tenant hereunder and to be personally bound by all of the covenants, terms
and conditions hereof on the part of Tenant to be performed or observed
hereunder.

12.02 CONTINUED LIABILITY. Tenant shall, despite any permitted
assignment or sublease, remain directly and primarily liable for the
performance of all of the covenants, duties, and obligations of Tenant
hereunder, and Landlord shall be permitted to enforce the provisions of this
Lease against Tenant or any assignee or sublessee without demand upon or
proceeding in any way against any other person.

12.03 CONSENT. Consent by Landlord to a particular assignment or
sublease shall not be deemed a consent to any other or subsequent transaction.
If this Lease is assigned or if the Premises are subleased without the
permission of Landlord, then Landlord may nevertheless collect Rent from the
assignee or sublessee and apply the net amount collected to the Rent payable
hereunder, but no such transaction or collection of Rent or application thereof
by Landlord shall be deemed a waiver of any provision hereof or a release of
Tenant from the performance of the obligations of the Tenant hereunder.

12.04 PROCEEDS. All cash or other proceeds of any assignment, sale
or sublease of Tenant's interest in this Lease, whether consented to by
Landlord or not, shall be paid to Landlord (net of leasing commissions, the
cost of leasehold improvements and any other costs incurred by Tenant in
connection with the assignment, sale or sublease) notwithstanding the fact that
such proceeds exceed the Rent called for hereunder, and Tenant hereby assigns
all rights it might have or ever acquire in any such (net) proceeds to
Landlord.

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ARTICLE 13

13.01 DEFAULT. Each of the following shall constitute a "Default"
by Tenant:

(a) The failure of Tenant to pay the Rent or any part thereof when
due and the continuation of such failure for five days after
Tenant is notified thereof; provided, however, that if Tenant
fails to make any payment required by this Lease when due 2 or
more times in any Lease Year, then notwithstanding that such
defaults have been cured by Tenant, any further similar
failure shall be deemed a Default without notice or
opportunity to cure;

(b) Tenant shall become insolvent or unable to pay its debts as
they become due, or Tenant notifies Landlord that it
anticipates either condition;

(c) Tenant takes any action to, or notifies Landlord that Tenant
intends to, file a petition under any section or chapter of
the United States Bankruptcy Code, as amended from time to
time, or under any similar law or statute of the United States
or any state thereof; or a petition shall be filed against
Tenant under any such statute or Tenant notifies Landlord that
it knows such a petition will be filed; or the appointment of
a receiver or trustee to take possession of substantially all
of Tenant's assets located at the Premises or of Tenant's
interest in this Lease; or the attachment, execution or other
judicial seizure of substantially all of Tenant's assets
located at the Premises or of Tenant's interest in this Lease;
unless the application of this subsection 13.01(c) shall
contravene any applicable law;

(d) Tenant shall fail to fulfill or perform, in whole or in part,
any of its obligations under this Lease (other than the
payment of Rent) and such failure or nonperformance shall
continue for a period of fifteen (15) days after written
notice thereof has been given by Landlord to Tenant; but if
the failure is of a nature that it cannot be cured within such
15-day period, Tenant shall not have committed a Default if
Tenant commences the curing of the failure within such 15-day
period and thereafter diligently pursues the curing of same
and completes the cure within sixty (60) days; or

(e) Tenant shall fail to take possession of the Premises within
ninety (90) days after the Commencement Date.

(f) Any representation by Tenant in any certificate or other
document furnished by Tenant to induce Landlord to enter into
this Lease, including without limitation, financial
information, proves to be incorrect in any material respect.

13.02 RIGHTS UPON DEFAULT. If a Default by Tenant occurs, then at
any time thereafter prior to the curing thereof, with or without notice or
demand, Landlord may exercise

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<PAGE> 19
any and all rights and remedies available to Landlord under this Lease, at law
or in equity, including without limitation, termination of this Lease and
termination of Tenant's right to possession without terminating the Lease. If
Tenant is in Default for nonpayment of Rent and if Tenant fails to pay same in
full within five (5) days after Landlord hand delivers to the Premises written
notice of Landlord's intent to exercise its lockout rights, then Landlord shall
be entitled to change or modify door locks on all entry doors of the Premises
and Tenant shall not be entitled to a key to re-enter the Premises until all
delinquent Rent is paid in full; provided, however, Landlord shall immediately
thereafter post a notice on an entry door to the Premises, stating that
Landlord has exercised such lockout rights. If Tenant vacates or abandons the
Premises or any significant portion thereof, Landlord may permanently change
the locks without notice to Tenant, and Tenant shall not be entitled to a key
to re-enter the Premises. The two preceding sentences shall supersede any
conflicting provisions of Section 93.002 of the Texas Property Code or any
successor statute. In the event of a Default, Landlord may, without additional
notice and without court proceedings, re-enter and repossess the Premises and
remove all persons and property therefrom, and Tenant hereby agrees to
surrender possession of the Premises, waives any claim arising by reason
thereof or by reason of issuance of any distress warrant or writ of
sequestration, and agrees to hold Landlord harmless from any such claims. If
Landlord elects to terminate this Lease, it may treat the default as an entire
breach of this Lease and Tenant shall immediately become liable to Landlord for
damages equal to the total of (a) the cost of recovering, reletting, including,
without limitation, the cost of leasing commissions attributable to the
unexpired portion of the Term of this Lease, and remodeling the Premises, (b)
all unpaid Rent and other amounts earned or due through such termination,
including interest thereon at the rate specified in Section 13.04 hereof, plus
(c) the present value (discounted at the rate of 8% per annum) of the balance
of the Rent for the remainder of the Term less the present value (discounted at
the same rate) of the fair market rental value of the Premises for said period
and (d) any other sum of money and damages owed by Tenant to Landlord. If
Landlord elects to terminate Tenant's right to possession of the Premises
without terminating this Lease, Landlord may (but shall not be obligated to)
rent the Premises or any part thereof for the account of Tenant to any person
or persons for such rent and for such terms and conditions as Landlord
reasonably deems appropriate, and Tenant shall be liable to Landlord for the
amount, if any, by which the Rent for the unexpired balance of the Term exceeds
the net amount, if any, received by Landlord from such reletting, being the
gross amount so received by Landlord less the costs of repossession, reletting,
remodeling, and other expenses incurred by Landlord. Such sum or sums shall be
paid by Tenant in monthly installments on the first day of each month of the
Term. In no case shall Landlord be liable for failure to relet the Premises or
to collect the rent due under such reletting, and in no event shall Tenant be
entitled to more than 50% of any excess rents received by Landlord. All rights
and remedies of Landlord shall be cumulative and not exclusive.

13.03 COSTS. If a Default by Tenant occurs, then Tenant shall
reimburse Landlord on demand for all costs reasonably incurred by Landlord in
connection therewith including, but not limited to, reasonable attorney's fees,
court costs, and related costs, plus interest thereon from the date such costs
are paid by Landlord until Tenant reimburses Landlord, at the rate specified in
Section 13.04 hereof.

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<PAGE> 20
13.04 INTEREST. All late payments of Rent, costs or other amounts
due from Tenant under this Lease shall bear interest from the date due until
paid at the rate of 18% per annum; provided, however, in no event shall the
rate of interest hereunder exceed the maximum nonusurious rate of interest (the
"Maximum Rate") permitted by the applicable laws of the State of Texas or the
United States of America, whichever shall permit the higher non-usurious rate,
and as to which Tenant could not successfully assert a claim or defense of
usury, and to the extent that the Maximum Rate is determined by reference to
the laws of the State of Texas, the Maximum Rate shall be the indicated rate
ceiling (as defined and described in Texas Revised Civil Statutes, Article
5069-1.04, as amended) at the applicable time in effect.

13.05 LANDLORD'S LIEN. Landlord reserves (and is hereby granted) a
first and superior lien and security interest (which shall be in addition to
and not in lieu of the statutory landlord's lien) on all fixtures, equipment,
and personal property (tangible and intangible) now or hereafter placed by
Tenant in or on the Premises to secure all sums due by Tenant hereunder, which
lien and security interest may be enforced by Landlord in any manner provided
by law, including, without limitation, under and in accordance with the Texas
Uniform Commercial Code. The provisions of this Section shall constitute a
security agreement under the Texas Uniform Commercial Code and, at Landlord's
request, Tenant shall execute and file, where appropriate, all documents
required to perfect the security interest herein granted in accordance with the
Texas Uniform Commercial Code. Landlord may at its election at any time file a
copy of this Lease as a financing statement. Unless otherwise provided by law
and for the purpose of exercising any right pursuant to this Section, Landlord
and Tenant agree that reasonable notice shall be met if such notice is given by
five days' written notice, certified mail, return receipt requested, to
Landlord or Tenant at the address specified herein.

Notwithstanding anything in this Lease to the contrary, the lien
granted to Landlord herein and the statutory landlord's lien granted to
Landlord pursuant to the Texas Property Code shall be subject and subordinate
to any and all purchase money security interests in and to any furniture,
fixtures and equipment of Tenant. Further, in no event shall such liens and
security interest cover data or files (including computer data or files),
promissory notes, documents, contracts, maps, instruments or similar property,
and notwithstanding any eviction of Tenant pursuant to the terms of the Lease,
Landlord will make such excluded property available to Tenant upon request.

13.06 NON-WAIVER. The failure of Landlord or Tenant to seek redress
for violation of, or to insist upon the strict performance of, any covenant or
condition of this Lease shall not prevent a subsequent act or omission that
would have originally constituted a violation of this Lease from having all the
force and effect of an original violation. The receipt by Landlord of Rent
with or without knowledge of the breach of any provision of this Lease shall
not be deemed a waiver of such breach, shall not reinstate this Lease or
Tenant's right of possession if either or both have been terminated, and shall
not otherwise affect any notice, election, action, or suit by Landlord. No
provision of this Lease shall be deemed to have been waived unless such waiver
is in writing signed by the waiving party. No act or thing done by Landlord
during the

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<PAGE> 21
Term shall be deemed an acceptance of a surrender of the Premises and no
agreement to accept such surrender shall be valid, unless express and in
writing signed by Landlord.

ARTICLE 14

14.01 EVIDENCE OF AUTHORITY. Simultaneously with the execution and
delivery of this Lease, Tenant shall deliver a fully executed Certificate of
the Secretary of Tenant's corporate managing general partner, with attached
Resolutions of its corporate board and with attached provisions from Tenant's
partnership agreement indicating the authority of the managing general partner
to execute this Lease, substantially in the form attached hereto as Exhibit
"H".

ARTICLE 15

15.01 AMENDMENT. Any agreement hereafter made between Landlord and
Tenant shall be ineffective to modify, release, or otherwise affect this Lease,
in whole or in part, unless such agreement is in writing and signed by the
party to be bound thereby.

15.02 SEVERABILITY. If any term or provision of this Lease shall,
to any extent, be held invalid or unenforceable by a final judgment of a court
of competent jurisdiction, the remainder of this Lease shall not be affected
thereby.

15.03 ESTOPPEL LETTERS. Tenant shall promptly upon request from
Landlord execute and acknowledge a certificate containing such information as
may be reasonably requested for the benefit of Landlord, any prospective
purchaser or any current or prospective mortgagee of all or any portion of the
Project.

15.04 LANDLORD'S LIABILITY AND AUTHORITY. The liability of Landlord
to Tenant for any default by Landlord under the terms of this Lease shall be
limited to the interest of Landlord in the Project, it being intended that
Landlord, its officers, directors and employees shall not be personally liable
for any judgment or deficiency. Whenever in this Lease there is imposed upon
Landlord or Tenant the obligation to use its best efforts, reasonable efforts,
diligence or act in good faith, Landlord or Tenant, as the case may be, shall
be required to do so only to the extent the same is economically feasible and
otherwise will not impose upon Landlord extreme burdens, financial or
otherwise.

15.05 HOLDOVER. If Tenant shall remain in possession of the
Premises after the Expiration Date or earlier termination of this Lease, then
Tenant shall be deemed a tenant-at-will whose tenancy is terminable at any
time. In such event, Tenant shall pay Rent at one and one half the daily
rental rate prevailing on the date of such termination or expiration, but
otherwise shall be subject to all of the obligations of Tenant under this
Lease. Additionally, Tenant shall pay to Landlord all damages sustained by
Landlord on account of such holding over by Tenant.

15.06 SURRENDER. Upon the expiration or earlier termination of the
Term, Tenant shall peaceably quit and surrender the Premises in the condition
required by Sections 6.01 and

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6.02 hereof. All obligations of Tenant for the period of time prior to the
expiration or earlier termination of the Term shall survive such expiration or
termination.

15.07 PARTIES AND SUCCESSORS. Subject to the limitations and
conditions set forth elsewhere herein, this Lease shall bind and inure to the
benefit of the respective heirs, legal representatives, successors, and
permitted assigns and/or sublessees of the parties hereto. The term
"Landlord", as used in this Lease, so far as the performance of any covenants
or obligations on the part of Landlord under this Lease are concerned, shall
mean only the owner of the Project at the time in question, so that in the
event of any transfer of title to the Project, the party by whom any such
transfer is made shall have no liability for a breach of any obligations of the
Landlord under this Lease after the date of such transfer, and the party to
whom any such transfer is made shall have no liability for any breach of the
obligations of the Landlord under this Lease before the date of the transfer.
Landlord shall have the right to transfer, sell, assign, mortgage or encumber,
in whole or in part, all of its rights and obligations hereunder and in the
Building, the Land, the Project and other property of Landlord referred to
herein.

15.08 NOTICE. Except as otherwise provided herein, any statement,
notice, or other communication that Landlord or Tenant may desire or be
required to give to the other shall be deemed sufficiently given or rendered if
hand delivered, or if sent by registered or certified mail, return receipt
requested, addressed at the address(es) first hereinabove given or at such
other addresses(es) as the other party shall designate from time to time by
prior written notice, and such notice shall be effective when the same is
received or mailed as herein provided.

15.09 RULES AND REGULATIONS. Tenant, its servants, employees,
agents, visitors, invitees, and licensees, shall observe faithfully and comply
strictly with the Rules and Regulations set forth in Exhibit "I" hereto, and
shall abide by and conform to such further reasonable nondiscriminatory Rules
and Regulations as Landlord may from time to time make, amend or adopt, after
Tenant receives a copy thereof.

15.10 CAPTIONS. The captions in this Lease are inserted only as a
matter of convenience and for reference and they in no way define, limit, or
describe the scope of this Lease or the intent of any provision hereof.

15.11 NUMBER AND GENDER. All genders used in this Lease shall
include the other genders, the singular shall include the plural, and the
plural shall include the singular, whenever and as often as may be appropriate.

15.12 GOVERNING LAW. This Lease shall be governed by and construed
in accordance with the laws of the State of Texas.

15.13 INABILITY TO PERFORM. Notwithstanding Section 15.18 hereof,
whenever a period of time is herein prescribed for the taking of any action by
Landlord or Tenant, such party shall not be liable or responsible for, and
there shall be excluded from the computation of

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such period of time, any delays due to strikes, riots, acts of God, shortages
of labor or materials, war, governmental laws, regulations or restrictions, or
any other cause whatsoever beyond the control of such party (financial
inability or hardship excepted), and such nonperformance or delay in
performance shall not constitute a breach or default by such party under this
Lease nor give rise to any claim against such party for damages or constitute a
total or partial eviction, constructive or otherwise: provided, however, this
provision shall not: (1) excuse any delay in, or extend the time periods set
forth herein for Landlord's or Tenant's making of payments required by this
Lease; or (2) extend the dates and time periods specified in Sections 3.06 and
5.03 for purposes of determining Tenant's right to exercise the remedies
expressly provided in those Sections. Although Tenant's right to exercise
remedies expressly provided in Sections 3.06 and 5.03 will not be affected by
this provision, any other remedies of Tenant will be subject to this provision.

15.14 USE OF NAME. Tenant shall not, except to designate Tenant's
business address (and then only in a conventional manner and without emphasis
or display), use the name or mark "Two Bridgepoint" or "Bridgepoint Square" for
any purpose whatsoever.

15.15 BROKER. Tenant represents and warrants that the only brokers
Tenant has dealt with in connection with this Lease are: (1) Oxford
Commercial, Inc., which although representing Tenant, is expected to look to
Landlord for the payment of any commission in connection with this Lease
pursuant to a separate written agreement between it and Landlord; (2) Cushman
and Wakefield of Texas, Inc., which, although representing Tenant, is expected
to look only to Oxford Commercial, Inc. for the payment of any commission in
connection with this Lease pursuant to a separate written agreement between it
and Oxford Commercial, Inc.; and (3) FIC Realty Services, Inc. which represents
Landlord and is expected to look only to Landlord for any compensation in
connection with this Lease. Tenant also represents that, insofar as Tenant
knows, no other broker(s) negotiated this Lease or are entitled to any
commission in connection herewith. Tenant shall indemnify and hold harmless
Landlord from and against all claims (and costs of defending against and
investigating such claims) of any other broker(s) or similar parties claiming
under Tenant in connection with this Lease.

15.16 ENTIRE AGREEMENT. This Lease, including all Exhibits attached
hereto (which Exhibits are hereby incorporated herein and shall constitute a
portion hereof), contains the entire agreement between Landlord and Tenant with
respect to the subject matter hereof. Tenant hereby acknowledges and agrees
that neither Landlord nor Landlord's agents or representatives have made any
representations, warranties, or promises with respect to the Project, the
Premises, Landlord's services, or any other matter or thing except as herein
expressly set forth, and no rights, easements, or licenses are acquired by
Tenant by implication or otherwise except as expressly set forth in this Lease.
The taking of possession of the Premises by Tenant shall be conclusive
evidence, as against Tenant, that Tenant accepts the Premises and the Project,
and that same were in good and satisfactory condition at the time such
possession was so taken, subject to punch list items and latent defects.
Further, the terms and provisions of this Lease shall not be construed against
or in favor of a party hereto merely

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because such party is the "Landlord" or the "Tenant" hereunder or such party or
its counsel is the craftsman of this Lease.

15.18 TIME OF ESSENCE. Time is of the essence of this Lease and
each and all of its provisions in which performance is a factor.

15.19 PARKING. Tenant shall have the right to use the parking
facilities of the Building, subject to the rules and regulations for such
parking facilities, all as set forth in Exhibit "I" hereto. Landlord will
maintain the parking areas serving the Building as necessary to provide parking
to each of the building's occupants at a ratio of no less than one parking
space per 279 rentable square feet. In addition, Tenant shall be entitled to
lease as many as four (4) executive parking spaces beneath the Building at a
cost of $120.00 per space per month in addition to the Rent. Tenant shall
comply with all traffic, security, safety and other rules and regulations
concerning parking as are reasonably promulgated from time to time by Landlord.
Tenant shall indemnify and hold harmless Landlord from and against all claims,
losses, liabilities, damages, costs and expenses (including, but not limited
to, attorneys' fees and court costs) arising out of Tenant's use of any such
parking spaces, whether or not caused or alleged to be caused by Landlord's
negligence.

15.20 TENANT TAXES. Tenant shall pay, or cause to be paid, before
delinquency, any and all taxes levied or assessed and which become payable
during the Term upon all of Tenant's non-Building Standard leasehold
improvements and all of Tenant's equipment, furniture, fixtures and personal
property located in the Premises.

15.21 ATTORNEY'S FEES. In the event either party defaults or is
alleged to have defaulted in the performance of any of the terms, agreements or
conditions contained in this Lease and the other party places the enforcement
of this Lease, or any part thereof, or the collection of any amount due or to
become due hereunder, or recovery of the possession of the Premises, in the
hands of any attorney who files suit upon the same, the prevailing party in the
suit shall be entitled to recover its reasonable attorney's fees from the other
party.

15.22 LANDLORD ALTERATIONS OR MODIFICATIONS. Subject to the other
provisions hereof, Landlord expressly reserves the right in its sole discretion
to temporarily or permanently change the location of, close, block or otherwise
alter any entrances, corridors, skywalks, tunnels, doorways, or walkways
leading to or providing access to the Building or any part thereof or otherwise
restrict the use of same, provided such acts do not materially and adversely
impair Tenant's access to or interfere with Tenant's use and enjoyment of the
Premises. Landlord shall not incur any liability whatsoever to Tenant as a
consequence of acts authorized by this provision, and such acts shall not be
deemed to be a breach of any of Landlord's obligations hereunder. Landlord
agrees to exercise good faith in notifying Tenant within a reasonable time in
advance of any alterations, modification or other acts of Landlord under this
Section.

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15.23 NAME CHANGE. Landlord and Tenant covenant and agree that
Landlord hereby reserves and shall have the right at any time and from time to
time to change the name of the Building as Landlord may deem advisable, and
Landlord shall not incur any liability whatsoever to Tenant as a consequence
thereof.

15.24 SIGNAGE. Landlord shall provide monument signage in the front
of the Building which identifies Tenant. In addition, interior signage, suite
identity and lobby directories will be provided by Landlord consistent with
those provided as of the date of this Lease in building in the Project known as
One Bridgepoint. So long as Tenant occupies more rentable square feet in the
Building than any other occupant, Landlord will consider in good faith any
request by Tenant for a sign on the exterior of the Building itself that
identifies Tenant. However, without limiting Landlord's discretion to permit
or decline to permit any such sign on the exterior of the Building, it is
understood that Landlord will not permit any exterior signs on the Building
that Landlord determines to be inconsistent with its leasing or management
policies for the Project.

EXECUTED as of the date first written above.

LANDLORD:

INVESTORS LIFE INSURANCE COMPANY OF NORTH AMERICA

By: /s/ JAMES M. GRACE
----------------------------------------------

Name: James M. Grace
--------------------------------------------
Title: Executive Vice President
Assistant Secretary
-------------------------------------------

TENANT:

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company, a Texas
corporation, as managing general partner

By: /s/ BEN M. BRIGHAM
----------------------------------------
Ben M. Brigham, President and CEO

<PAGE> 1
EXHIBIT 10.15
ANADARKO BASIN
SEISMIC OPERATIONS AGREEMENT

This Anadarko Basin Seismic Operations Agreement (this "Agreement") is
dated effective as of the 15th day of February, 1996, and is by and between
BRIGHAM OIL & GAS, L.P. ("BOG") and VERITAS GEOPHYSICAL, LTD. ("Veritas") (BOG
and Veritas being sometimes individually referred to herein as a "Party" and
collectively referred to herein as the "Parties");

WHEREAS, BOG has identified a number of areas within the lands
described in Exhibit A which is attached hereto and incorporated herein for all
purposes (the lands described in Exhibit A being hereinafter referred to as the
"Alliance Area"), within which BOG desires to pursue oil and gas exploration
and/or development operations with project participants; and

WHEREAS, BOG desires to have Veritas conduct three-dimensional seismic
operations within the Alliance Area as provided in this Agreement; and

WHEREAS, Veritas desires to perform such three-dimensional seismic
operations within the Alliance Area pursuant to the terms set forth in this
Agreement;

NOW, THEREFORE, for and in consideration of the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto agree as
follows:

ARTICLE I.
RELATIONSHIP OF PARTIES

Section 1.1. No Partnership. The liabilities of the Parties
hereunder shall be several, not joint or collective. It is not the intention
of the Parties to create, nor shall this Agreement be deemed as creating, a
mining, tax or other partnership or association or to render the Parties liable
as partners. However, if for federal income tax purposes, this Agreement and
the operations hereunder are regarded as a partnership, each Party thereby
affected elects to be excluded from the application of all of the provisions of
Subchapter "K," Chapter 1, Subtitle "A," of the Internal Revenue Code of 1986,
as amended (hereinafter referred to as the "Code"), as permitted and authorized
by Section 761 of the Code and the regulations promulgated thereunder. Should
there be any requirement that each Party hereby affected give further evidence
of this election, each such Party shall execute such documents and furnish such
other evidence as may be required by the Federal Internal Revenue Service or as
may be necessary to evidence this election. No Party shall give any notice or
take any other action inconsistent with the election made hereby. In making
the foregoing election, each Party states that the income derived by such Party
from operations hereunder can be adequately determined without the computation
of partnership taxable income.

ARTICLE II.
CONDUCT OF SEISMIC OPERATIONS

Section 2.1. BOG Project Areas. The Parties recognize and
acknowledge that BOG will be designating geographic areas within the Alliance
Area (the separate geographic areas being herein referred to as "Project
Areas") for the conduct of three-dimensional seismic operations (hereinafter
referred to as "3-D Operations") hereunder for the benefit of BOG and its
participants. For purposes of this Agreement BOG's participants (hereinafter
referred to as "BOG Participants") shall mean (i) those parties that have
entered into an agreement with BOG providing for such parties' joint
participation with BOG in an entire Project Area, and (ii) those entities in
which BOG either owns more than fifty one percent (51%) of the ownership equity
in such entity or controls the day to day operations of such entity. The
Parties recognize and acknowledge that third parties that enter into agreements
with BOG under which such parties either assign or are assigned interests
covering less than an entire Project Area are not BOG Participants for purposes
of this Agreement. For example, in the event that BOG simply enters into a
farm-in agreement with the owner of an oil and gas leasehold estate covering
less than an entire Project Area, such party will not be considered a BOG
Participant for purposes of this Agreement.
<PAGE> 2
Section 2.2. BOG Commitment to 500 Square Miles.

A. Subject to the terms and provisions which are contained in
this Agreement, within eighteen months of the effective date of this Agreement
BOG agrees to utilize a Veritas seismic crew (hereinafter referred to as the
"Alliance Seismic Crew") to conduct 3-D Operations within Project Areas
covering a total of at least five hundred square miles within the Alliance
Area; provided, however, that at BOG's option such eighteen month period shall
be extended for any days during which the Alliance Seismic Crew does not
conduct operations hereunder due to weather conditions or any other causes
which are not the fault of BOG. The Parties recognize and acknowledge that in
order to complete 3-D Operations across the entire final Project Area which is
to be shot pursuant to the terms of this Agreement, the total square miles
covered by 3-D Operations hereunder may exceed five hundred square miles;
provided, however, that the Parties agree that the total square miles covered
by the 3-D Operations will not exceed five hundred fifty square miles without
the consent of both Parties. In addition, the Parties recognize and
acknowledge that in the event that Terrain Excluded Project Areas (as defined
in Section 2.6 below) or Sand Tire Excluded Project Areas (as defined in
Section 2.7 below) are designated hereunder, such five hundred square mile
commitment shall be reduced by the number of square miles which are covered by
the Terrain Excluded Project Areas and Sand Tire Excluded Project Areas.

B. For purposes of this Agreement the number of square miles
which are covered by the 3-D Operations shall be determined by the total number
of source and receiver points which are shot as part of the 3-D Operation for
the Project Area.

(i) For the 1,320' receiver line spacing parameters one hundred
ninety two total source and receiver points shall be deemed to be one
square mile; provided, however, that in the event that the total
number of receiver points are greater than fifty-one percent of the
total source and receiver points for any Project Area, any receiver
points exceeding such fifty-one percent amount shall not be counted
for purposes of determining the number of square miles covered by the
3-D Operations, and in the event that the total number of source
points are greater than fifty-one percent of the total source and
receiver points for the Project Area, any source points exceeding such
fifty-one percent amount shall not be counted for purposes of
determining the number of square miles covered by the 3-D Operations.
However, in the event that the total number of receiver points exceed
fifty-one percent of the total source and receiver points for a
Project Area and BOG approves such excess receiver points, though
those excessive receiver points will not be counted for purposes of
determining the number of square miles which are covered by the 3-D
Operations, BOG shall be charged for the number of receiver points
exceeding such fifty-one percent of total points at a rate of
sixty-seven dollars ($67.00) per additional receiver point. In the
event that the total number of source points exceed fifty-one percent
of the total source and receiver points for a Project Area and BOG
approves such excessive source points, though those excessive source
points will not be counted for purposes of determining the number of
square miles which are covered by the 3-D Operations, BOG shall be
charged for the number of source points exceeding such fifty-one
percent of total points at a rate of one hundred twelve dollars
($112.00) per additional source point. In the event that Veritas must
cable around a tract that is to be excluded from the 3-D Operations
and the amount of cable which is utilized to cable around such tract
would normally have more than five receiver points on it, then the
number of receiver points along the cable length which is used to
cable around such tract shall be counted as receiver points for
purposes of determining the number of square miles which are covered
by the 3-D Operations.

(ii) For the 660' receiver line spacing parameters two hundred
eighty-eight total source and receiver points shall be deemed to be
one square mile; provided, however, that in the event that the total
number of receiver points are greater than sixty-seven and one-half
percent of the total source and receiver points for any Project Area,
any receiver points exceeding such sixty-seven and one-half percent
amount shall not be counted for purposes of determining the number of
square miles covered by the 3-D Operations, and

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Seismic Operations Agreement 2
<PAGE> 3
in the event that the total number of source points are greater than
sixty-seven and one-half percent of the total points for the Project
Area, any source points exceeding such sixty-seven and one-half
percent amount shall not be counted for purposes of determining the
number of square miles covered by the 3-D Operations. However, in the
event that the total number of receiver points exceed sixty-seven and
one-half percent of the total source and receiver points for a Project
Area and BOG approves such excess receiver points, though those
excessive receiver points will not be counted for purposes of
determining the number of square miles which are covered by the 3-D
Operations, BOG shall be charged for the number of receiver points
exceeding such sixty- seven and one-half percent of total points at a
rate of seventy-nine dollars ($79.00) per additional receiver point.
In the event that the total number of source points exceed sixty-seven
and one-half percent of the total source and receiver points for a
Project Area and BOG approves such excessive source points, though
those excessive source points will not be counted for purposes of
determining the number of square miles which are covered by the 3-D
Operations, BOG shall be charged for the number of source points
exceeding such sixty-seven and one-half percent of total points at a
rate of one hundred thirty-two dollars ($132.00) per additional source
point. In the event that Veritas must cable around a tract that is to
be excluded from the 3-D Operations and the amount of cable which is
utilized to cable around such tract would normally have more than five
receiver points on it, then the number of receiver points along the
cable length which is used to cable around such tract shall be counted
as receiver points for purposes of determining the number of square
miles which are covered by the 3-D Operations, and

Section 2.3. Parameters and Equipment. For each Project Area BOG
shall select: 1) the seismic parameters that are to be utilized for the 3-D
Operations to be conducted within such Project Area from the parameters which
are set forth in Exhibit D; and 2) the equipment which is to be utilized for
the 3-D Operations to be conducted within such Project Area from the equipment
list which is set forth in Exhibit E. However, if for any Project Area BOG
desires to utilize parameters other than those which are set forth in Exhibit D
or equipment other than that which is listed in Exhibit E, BOG and Veritas
shall attempt to mutually agree upon the reasonable charges to be incurred for
such parameters or equipment. Should the Parties fail to reach agreement on
such charges, such Project Area shall be removed from this Agreement and shall
not be considered part of the five hundred square mile commitment which is set
forth in this Agreement; such five hundred square mile commitment shall not,
however, be reduced as the result of any such removal of a Project Area.

Section 2.4. Notification of Project Area Outline and Parameters
and Equipment. No less than twenty-one days prior to the expected commencement
of the field seismic acquisition operations for each of its Project Areas, BOG
will notify Veritas in writing of 1) the location and outline of the specific
Project Area, 2) the parameters to be utilized for the Project Area, 3) the
equipment to be utilized for the Project Area, and 3) the approximate patch to
be used for source and receiver lines within the Project Area.

Section 2.5. Veritas 3-D Seismic Crew Commitment. Commencing with
the effective date of this Agreement and continuing for a period of eighteen
months thereafter (as same may be extended as provided in Section 2.2 above),
Veritas hereby agrees to give BOG priority use of the Alliance Seismic Crew for
the continuous conduct of 3-D Operations covering approximately five hundred
square miles as provided in Section 2.2 above. BOG shall make a reasonable
effort to have Project Areas ready for surveying and field acquisition such
that the Alliance Seismic Crew may go directly from the completion of 3-D
Operations within one Project Area to the start of 3-D Operations for the next
Project Area. As long as BOG has a Project Area ready for surveying and field
seismic acquisition, Veritas agrees that the Alliance Seismic Crew will go from
Project Area to Project Area without interruption unless and until such time as
BOG does not have a Project Area ready for surveying and field seismic
acquisition. In the event that BOG notifies Veritas that BOG will not have a
Project Area ready for surveying in source and receiver points upon the
completion of the current Project Area, Veritas shall make every reasonable
effort to place the

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<PAGE> 4

Alliance Seismic Crew on a third-party project area with as little stand-by
time as possible incurred prior to the commencement of the next BOG Project
Area. However, in the event that following the completion of 3-D Operations
for a BOG Project Area the Alliance Seismic Crew is moved to a third-party
project area as provided above, at BOG's request, Veritas will schedule the
Alliance Seismic Crew to move to a designated BOG Project Area as soon as
possible following the completion of the intervening third-party project areas
which have been scheduled by Veritas prior to its receipt of BOG's notice. In
the event that following the completion of 3-D Operations for a BOG Project
Area a subsequent BOG Project Area is not ready for surveying and, despite
Veritas' efforts to place the Alliance Seismic Crew on a third- party project
area, the Alliance Seismic Crew experiences stand-by time, unless BOG has given
Veritas at least sixty days advance notice, as provided below in this Section
2.5, that no Project Area will be ready, BOG shall compensate Veritas for
stand-by time incurred by the Alliance Seismic Crew as follows (a) for the
first three days of stand-by time BOG shall pay Veritas fifteen thousand
dollars per day, and (b) for any stand-by time incurred after three days, BOG
shall pay Veritas ten thousand dollars per day; provided, however, in no event
shall BOG be required to pay Veritas more than four hundred fifty thousand
dollars in total stand-by charges for stand-by time incurred between the
completion of any one BOG Project Area and the commencement of the next
succeeding BOG Project Area. Anything to the contrary contained herein
notwithstanding, in the event that BOG gives Veritas at least sixty days
advance notice that BOG will not have any Project Areas ready for surveying and
field seismic acquisition, anything to the contrary contained in this Section
2.5 notwithstanding, BOG shall not be required to pay any stand-by time charges
for any stand- by time that may be incurred by Veritas more than sixty days
after Veritas' receipt of such notice. In the event that BOG gives Veritas
sixty days notice that BOG will not have any Project Areas ready for surveying
and field seismic acquisition, after such sixty day time period BOG shall not
be responsible for stand-by charges, unless and until BOG gives Veritas written
notice of a date by which BOG will have a Project Area ready for 3-D Operations
and then BOG subsequently fails to have a Project Area ready for surveying
within the time frame BOG has given Veritas. Any stand-by charges incurred
pursuant to this Section 2.5 shall be invoiced by Veritas on a monthly basis
and paid in full by BOG within thirty days of its receipt of an invoice
correctly reflecting the amount of such charges.

Section 2.6. Terrain Exception. No less than sixty days prior to
the expected commencement of the field seismic acquisition operations for a
Project Area BOG shall notify Veritas in writing of the general outline of such
Project Area so that Veritas may evaluate the terrain and operating conditions
that may be expected within the Project Area. In the event that Veritas
believes, in its reasonable opinion, that the terrain or operating conditions
for a Project Area is unreasonable such that routine seismic acquisition
operations will be excessively affected, Veritas must notify BOG in writing of
such determination within fifteen days of its receipt of BOG's notice of the
general outline for the Project Area. In the event that the terrain or
operating conditions for a Project Area is deemed to be unreasonable in
Veritas' reasonable opinion as aforesaid, the Parties shall attempt to
negotiate a fair Turnkey Charge (as defined in Article III below) for such
Project Area. In the event that within five business days of BOG's receipt of
Veritas' notification the Parties have not reached agreement on a Turnkey
Charge for the Project Area, such Project Area shall be deemed to have been
excluded from this Agreement for all purposes (hereinafter referred to as a
"Terrain Excluded Project Area") and BOG's commitment to conduct 3-D Operations
within Project Areas covering a total of at least five hundred square miles
shall be reduced by the size of such Terrain Excluded Project Area. Anything
to the contrary contained in this Agreement notwithstanding, the Parties agree
that the terrain and operating conditions which exist within the lands which
are outlined on Exhibit G, are not unreasonable such that routine seismic
acquisition operations within such lands would be excessively affected. The
Parties also recognize and agree that for purposes of this Section 2.6, other
lands which have terrain and operating conditions which are similar to those
that exist within the lands which are outlined on Exhibit G shall not be deemed
to be unreasonable such that routine seismic acquisition operations within such
lands would be excessively affected.

Section 2.7. Sand Tire Exception. In the event that BOG desires
to have the Alliance Seismic Crew vibrators equipped with sand tires for a
Project Area, no less than sixty days prior to the expected commencement of the
field seismic acquisition operations for such Project Area BOG shall notify
Veritas of its desire to utilize sand tires for such Project Area. In the
event that Veritas' existing sand tires will not be available for such Project
Area Veritas must notify BOG in writing of such determination within five
business days of its receipt of BOG's notice. In the

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<PAGE> 5

event that Veritas has notified BOG that Veritas' existing sand tires will not
be available for the scheduled Project Area as aforesaid, the Parties shall
attempt to negotiate a mutually agreeable arrangement for the provision of sand
tires for such Project Area. In the event that within five business days of
BOG's receipt of Veritas' notification the Parties have not reached agreement
on an arrangement for the provision of sand tires, BOG shall have the right to
exclude such Project Area from this Agreement for all purposes (hereinafter
referred to as a "Sand Tire Excluded Project Area") and BOG's commitment to
conduct 3-D Operations within Project Areas covering a total of at least five
hundred square miles shall be reduced by the size of such Sand Tire Excluded
Project Area.

Section 2.8. Excessive Weather Delays. Anything to the contrary
contained in Section 2.5 above notwithstanding, in the event that weather
problems prevent the Alliance Seismic Crew from conducting field seismic
acquisition operations within a Project Area for more than two continuous days
and it does not reasonably appear that the Alliance Seismic Crew will be able
to begin conducting field seismic acquisition operations for at least another
six days, unless BOG has oil and gas lease options, oil and gas leases or
farm-ins which are time sensitive, Veritas may move the Alliance Seismic Crew
off of such Project Area, provided that, unless BOG agrees otherwise, the
Alliance Seismic Crew shall return to the abandoned Project Area no later than
twenty days after it left such Project Area. In the event that Veritas
temporarily leaves a Project Area because of weather problems as provided in
this Section 2.8, Veritas shall pay any and all additional permitting,
surveying and damage costs or expenses which may be incurred as the result of
such temporary abandonment.

Section 2.9. General Terms and Provisions for 3-D Operations. All
3-D Operations provided for herein shall be conducted by Veritas in accordance
with the general terms and provisions which are set forth in Exhibit F which is
attached hereto and incorporated herein for all purposes. However, in the
event that there are any ambiguities or conflicts between the terms, provisions
and/or conditions which are set forth in the body of this Agreement and the
terms, provisions and/or conditions which are contained in Exhibit F, the
terms, provisions and conditions set forth in the body of this Agreement shall
control. Veritas covenants and warrants to BOG that during the term of this
Agreement the Alliance Seismic Crew shall use all reasonable efforts to keep
and maintain all of the equipment, supplies and personnel necessary to
efficiently perform the operations described in this Article II on a continuous
basis, including, without limitation, the equipment, supplies and personnel
described on Exhibit E which are selected by BOG for the applicable Project
Area.

Section 2.10. Veritas Failure to Perform. Anything to the contrary
contained herein notwithstanding, in the event that at any time the Alliance
Seismic Crew fails or is unable to perform seismic operations in full
compliance with all of the requirements set forth in this Agreement for more
than ten continuous days, in addition to and without limitation of any other
remedies which may be available to BOG at law or in equity, BOG shall have the
right to terminate this Agreement as to all future obligations to utilize the
Alliance Seismic Crew; provided, however, that if such failure to perform
seismic operations is due solely to weather or surface conditions which are
beyond Veritas' control or if BOG causes the nonperformance, BOG shall not have
the right to terminate this Agreement as provided herein.

Section 2.11. Definition of Completion of 3-D Operations. The
Parties agree that for all purposes of this Agreement, the 3-D Operations for
a Project Area shall be deemed to have been completed when BOG receives from
Veritas: 1) all of the final correlated field tapes resulting from all of the
3-D Operations conducted within the Project Area on 9-track tape or 3480
cartridges in a state that is suitable for processing; 2) all survey
information obtained within the Project Area in Seg-P1 format and on a hard
copy and digital format, including without limitation all shot and receiver
point locations and GPS stations located within the Project Area and all
non-seismic survey points obtained; and 3) all observor reports, field notes,
and any other survey and support data obtained. For each Project Area Veritas
agrees to provide all of the data and information which is described in this
Section 2.11 as soon as same is available and Veritas agrees to make every
reasonable effort to cause all of such data and information to be made
available as soon as is possible.

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5
<PAGE> 6
ARTICLE III
CONSIDERATION DUE TO VERITAS

Section 3.1. Payment of One-Third Seismic Acquisition Costs. For
each Project Area for which Veritas conducts and completes 3-D Operations as
provided herein, BOG shall owe Veritas one-third of 1) the turnkey charge which
is calculated as provided in Section 3.2 below based on the parameters,
dimensions and size of the applicable Project Area which are selected by BOG
for the applicable Project Area (hereinafter referred to as the "Turnkey
Charge") for the number of square miles over which 3-D Operations are conducted
within such Prospect Area, 2) the mobilization fee which is set forth in
Exhibit B for the number of road miles between the Project Area and the
previous Project Area (hereinafter referred to as the "Mobilization Fee"), and
3) the reimbursable costs which are not included in the Turnkey Charge as
reflected in Exhibit B, save and except any permitting and surface damage
settlement costs (the Turnkey Rate, the Mobilization Fee and all of the
reimbursable costs described in Exhibit B, save and except any permitting and
surface damage settlement costs, being hereinafter collectively referred to as
"Seismic Acquisition Costs"). BOG shall pay such one-third share of the
Seismic Acquisition Costs within thirty days of BOG's receipt of an invoice
correctly indicating the costs which have been incurred.

Section 3.2. Determining the Turnkey Charge. The Turnkey Charge
for each Project Area shall be determined as follows:

A. The number of square miles which are covered by the 3-D
Operations within the Project Area are to be determined by the total number of
source and receiver points that are included within such Project Area as
provided in Section 2.2 above. The total number of square miles which are
covered by the 3-D Operations within the applicable Project Area being referred
to in this Section 3.2 as the "TA."

B. BOG shall determine the source and receiver line spacing
(either 1320' or 660'), the patch (10x96 or 8x120) and the source and receiver
line directions.

C. The various lengths of the receiver lines within the Project
Area shall be determined, each individual receiver line length being rounded to
the nearest one-half mile. Each receiver line length for the applicable
Project Area being referred to in this Section 3.2 as a "RLLN", with "N" being
the length of the applicable receiver line rounded to the nearest one-half
mile. For example, if a Project Area has receiver line lengths that are five
and one- tenth miles wide, such receiver lines would be RLL5s. The same
Project Area could also have receiver lines that are three miles in width, or
RLL3s, as well as other receiver line lengths of any variation.

D. The hypothetical source line length for each RLLN shall be
determined by dividing the receiver line length of a specific RLLN (rounded to
the nearest one-half mile) into the TA. Each individual hypothetical source
line length being rounded to the nearest one-half mile and being referred to in
this Section 3.2 as a "HSLN", with "N" being the length of the receiver line
rounded to the nearest one-half mile. For example, if the Project Area's TA
equals 16 square miles, the HSL5 would equal sixteen divided by five, or three
point two, which would then be rounded to three.

E. The Turnkey Charge per square mile shall be determined for
each RLLN utilizing the applicable Master Rate Table set forth in Exhibit B for
the parameters selected by BOG and the HSLN for such RLLN. The Turnkey Charge
per square mile for an RLLN being found at the intersection of the receiver
line length for the applicable RLLN and the HSLN for such RLLN on the
applicable Master Rate Table. Such per square mile Turnkey Charge for each
RLLN shall be referred to in this Section 3.2 as "RRLLN."

F. The total number of square miles covered by each RLLN shall be
determined. The total number of square miles covered by an RLLN being referred
to in this Section 3.2 as an "SMRLLN." For example, if five mile long receiver
lines cover a total of twenty-two square miles within the applicable Project
Area, SMRLL5 for the Project Area would be twenty-two

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6
<PAGE> 7

square miles. It being understood that all of the SMRLLNs for a Project Area,
added together, total the TA for the Project Area.

G. The total Turnkey Charge for each RLLN shall then be
determined by multiplying the RRLLN for such RLLN times its SMRLLN. The total
Turnkey Charge for an RLLN being referred to in this Section 3.2 as "TCRLLN."

H. The sum of all of the TCRLLNs is then determined by adding
together all of the TCRLLNs for the Project Area. The sum of all of the
TCRLLNs for a Project Area being referred to in this Section 3.2 as the "SUM."

I. The average of all of the TCRLLNs for a Project Area is then
obtained by dividing the SUM by the TA for the Project Area. The average of
all of the TCRLLNs for a Project Area being referred to in this Section 3.2 as
the "AVG."

J. The Total Turnkey Charge per square mile for a Project Area is
then determined by adding twenty-five percent (25%) of the AVG to seventy-five
percent (75%) of the RRLLN for the longest receiver line in the Project Area.
The Total Turnkey Charge per square mile for a Project Area being referred to
in this Section 3.2 as the "TTCPM."

K. The Total Turnkey Charge for a Project Area is then determined
by multiplying the TTCPM for the Project Area times the TA for the Project
Area.

See Exhibit C for example determinations of the Turnkey Charges for
hypothetical Project Areas with different configurations.

Section 3.3. Right to Pay All Seismic Acquisition Costs and
Receive Full Ownership. Anything to the contrary contained herein
notwithstanding, prior to the commencement of field seismic acquisition for the
3-D Operations for a Project Area BOG shall have the right to designate in
writing all or any part of the Project Area for which it desires to pay one
hundred five percent of the Turnkey Charge for the applicable Project Area and
one hundred percent of all of the other Seismic Acquisition Costs related to
such selected lands (the lands for which BOG elects to pay one hundred five
percent of the Turnkey Charge and one hundred percent of other Seismic
Acquisition Costs as provided in this Section 3.3 being hereinafter referred to
as "Excluded Lands") in order to receive all of the ownership interest in the
seismic data obtained across the Excluded Lands. In the event that BOG
designates Excluded Lands covering all or part of a Project Area, BOG shall pay
one hundred five percent of the Turnkey Charge and one hundred percent of the
other Seismic Acquisition Costs related to such Excluded Lands within thirty
days of BOG's receipt of an invoice correctly indicating the costs which have
been incurred. The Parties recognize and acknowledge that with respect to the
Excluded Lands, BOG's obligation to pay one hundred five percent of the Turnkey
Charge and one hundred percent of the other Seismic Acquisition Costs related
to such Excluded Lands as provided in this Section 3.3 is in lieu of and
complete substitution for what would have otherwise been an obligation to pay
one-third of the Seismic Acquisition Costs as provided in Section 3.1 above and
the additional compensations set forth in Sections 3.4 and 3.5 below, and not
in addition to those obligations. The Parties also recognize and agree that in
the event that Excluded Lands are designated for a Project Area covering part,
but not all of the Project Area, the payment provided for in this Section 3.3
shall not include any part of the Mobilization Fee related to the applicable
Project Area as BOG shall still be required to pay such mobilization fee for
the Project Area in accordance with the terms and provisions of Sections 3.1
above and Sections 3.4 and 3.5 below. Anything to the contrary contained
herein notwithstanding, the Parties recognize and agree that if Excluded Lands
are designated hereunder such Excluded Lands shall not be counted as part of
BOG's commitment to utilize the Veritas Seismic Crew to conduct five hundred
square miles of 3-D Operations as set forth in Section 2.2 above and thus the
five hundred square mile commitment shall not be reduced by the number of
square miles which are included within Excluded Lands.

Section 3.4. Payment of 2/3rd Seismic Acquisition Cost Balance.
Until the earlier to occur of 1) the expiration of two years following the
completion of all of the 3-D Operations

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<PAGE> 8

conducted for the last Project Area covered by this Agreement (the period of
time commencing with the effective date of this Agreement and continuing until
the expiration of two years following the completion of all of the 3-D
Operations conducted for the last Project Area covered by this Agreement being
hereinafter referred to as the "Exclusivity Period"), or 2) such time as BOG
has paid Veritas a total amount under this Section 3.4 equal to the remaining
two- thirds of all Seismic Acquisition Costs (determined in accordance with the
provisions of Exhibit B for each of the applicable Project Areas) incurred in
conducting 3-D Operations within BOG Project Areas less and except the Excluded
Lands (such amount being hereinafter referred to as the "First Payout Amount"
and such time as BOG has paid Veritas the First Payout Amount being hereinafter
referred to as the "First Payout"), BOG shall pay Veritas an amount equal to
twenty percent of: (a) all actual lease bonus costs paid by BOG and the BOG
Participants to mineral interest owners in order to lease mineral interests
within Project Areas (other than within Excluded Lands, Terrain Excluded
Project Areas or Sand Tire Excluded Project Areas) after 3-D Operations have
been completed within such Project Area; and (b) all costs incurred by BOG and
the BOG Participants in drilling and completing oil and/or gas wells within
Project Areas (other than within Excluded Lands, Terrain Excluded Project Areas
or Sand Tire Excluded Project Areas) after 3-D Operations have been completed
within such Project Area. For the costs described in (a) above, within ten
working days following the end of a calendar month, BOG shall pay Veritas the
twenty percent fee on all actual lease bonus costs which were paid out by BOG
and the BOG Participants during such calendar month. For the costs described
in (b) above, within ten days of reaching casing point in a well, BOG shall pay
Veritas the twenty percent fee on drilling (and completion if BOG elects to
participate in completing such well) costs for such well based upon the AFE
prepared for such well; provided, however, that on a calendar quarter basis BOG
shall review all drilling and completion fees which have been paid to Veritas
during the calendar quarter to reconcile Veritas' account based on actual
drilling and completion costs incurred in drilling and completing wells during
the calendar quarter.

Section 3.5. Payments Following the First Payout. Following the
occurrence of the First Payout and continuing until the earlier to occur of 1)
the expiration of the Exclusivity Period, or 2) such time as BOG has paid
Veritas a total amount under this Section 3.5 equal to one million dollars
(such one million dollar amount being hereinafter referred to as the "Final
Payout Amount" and such time as BOG has paid Veritas the Final Payout Amount
being hereinafter referred to as "Final Payout"), BOG shall pay Veritas an
amount equal to ten percent of (i) all actual lease bonus costs paid by BOG
and the BOG Participants to mineral interest owners in order to lease mineral
interests within Project Areas (other than within Excluded Lands, Terrain
Excluded Project Areas or Sand Tire Excluded Project Areas) after 3-D
Operations have been completed within such Project Area and (ii) all costs
incurred by BOG and the BOG Participants in drilling and completing oil and/or
gas wells within Project Areas (other than within Excluded Lands, Terrain
Excluded Project Areas or Sand Tire Excluded Project Areas) after 3-D
Operations have been completed within such Project Area. For the costs
described in (i) above, within ten working days following the end of a calendar
month, BOG shall pay Veritas the ten percent fee on all actual lease bonus
costs which were paid out by BOG and the BOG Participants during such calendar
month. For the costs described in (ii) above, within ten days of reaching
casing point in a well, BOG shall pay Veritas the ten percent fee on drilling
(and completion if BOG elects to participate in completing such well) costs for
such well based upon the AFE prepared for such well; provided, however, that on
a calendar quarter basis BOG shall review all drilling and completion fees
which have been paid to Veritas during the calendar quarter to reconcile
Veritas' account based on actual drilling and completion costs incurred in
drilling and completing wells during the calendar quarter. Anything to the
contrary contained herein notwithstanding, in the event that Excluded Lands
have been designated by BOG in accordance with Section 3.3 above, Terrain
Excluded Project Areas are designated in accordance with Section 2.6 above or
Sand Tire Excluded Project Areas are designated in accordance with Section 2.7
above, the Final Payout Amount shall be reduced by an amount equal to the
product obtained by multiplying 1) the number obtained by dividing (a) the
number of square miles included within the Excluded Lands, Terrain Excluded
Project Areas and Sand Tire Excluded Project Areas by (b) five hundred, times
2) one million dollars. For example, if five square miles have been designated
as Excluded Lands in accordance with the provisions of Section 3.3 above and a
Terrain Excluded Project Area covering ten square miles has been designated in
accordance with the provisions of Section 2.6 above, the Final Payout Amount
will

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<PAGE> 9

be reduced by thirty thousand dollars (15/500 x $1,000,000 = $30,000).
However, if more than five hundred square miles are covered by the 3-D
Operations hereunder, the Final Payout Amount will be increased by an amount
equal to the product obtained by multiplying 1) the number obtained by dividing
(a) the total number of square miles covered by the 3-D Operations by (b) five
hundred, times 2) one million dollars. For example, if five hundred and thirty
square miles have been covered by the 3-D Operations, the Final Payout Amount
will be increased by sixty thousand dollars (530/500 x $1,000,000 = $60,000).
In addition, in the event that BOG's obligation to continue to use the Alliance
Seismic Crew is terminated prior to the completion of 3-D Operations covering
five hundred square miles as provided in Section 2.10, the Final Payout Amount
shall be reduced by an amount equal to the product obtained by multiplying 1)
the number obtained by dividing (a) the sum obtained by subtracting the number
of square miles covered by 3-D Operations which have been completed within
Project Areas prior to such termination from five hundred, by (b) five hundred,
times 2) one million dollars. For example, if 3-D Operations have been
completed covering three hundred square miles and BOG's obligation to continue
to utilize the Alliance Seismic Crew is subsequently terminated in accordance
with the terms of Section 2.10 above, then the Final Payout Amount shall be
reduced by four hundred thousand dollars ([500-300]/500 x $1,000,000 =
$400,000).

Section 3.6. Monthly Lease Bonus and Drilling and Completion Cost
Reports. Commencing with the completion of 3-D Operations for the first
Project Area hereunder and continuing until such time as the Final Payout has
occurred, within thirty days of the end of each calendar month BOG shall
provide Veritas with a report setting forth the amount of lease bonus costs and
drilling and completion costs which have been incurred by BOG within each
Project Area following the completion of 3-D Operations for such Project Area.

Section 3.7. Exclusion of Production Purchases. Anything to the
contrary contained in this Agreement notwithstanding, it is recognized and
agreed that in the event that subsequent to the date of this Agreement BOG or
any BOG Participant acquires an interest in oil and/or gas leasehold, mineral
or royalty interests that are already producing oil and/or gas, or that are
held by production which was in existence prior to the completion of 3-D
Operations covering such lands, BOG shall not be required to pay any
consideration to Veritas under the terms of Section 3.4 or 3.5 above as the
result of such acquisition with respect to the consideration paid for the
acquisition. However, in the event that following the completion of 3-D
Operations on the lands which are the subject of the acquisition, BOG or any
BOG Participant subsequently participates in the drilling of a well involving
the interests that were acquired in the acquisition, the terms and provisions
of Sections 3.4 or 3.5 (whichever is the applicable) shall apply with respect
to any drilling and completion costs incurred with respect to the drilling of
such well.

Section 3.8. Reimbursement for Permitting and Surveying Costs.
Veritas shall pay all BOG approved permitting costs and surface damage
settlement payments. Veritas shall submit to BOG an invoice on a monthly basis
for all permit and surface damage settlement payments incurred during the month
and BOG shall reimburse Veritas for one hundred percent of all of such costs
within ten days of BOG's receipt of the invoice.

Section 3.9. Compensation for BOG Failure to Shoot 500 Square
Miles. In the event that BOG fails, for any reason, to make sufficient Project
Areas ready for 3-D Operations in order to cause 3-D Operations to be conducted
by the Alliance Seismic Crew covering at least five hundred square miles within
the Alliance Area within eighteen months (as same may be extended as provided
in Section 2.2 above) of the effective date of this Agreement as provided in
Sections 2.2 and 2.5 above, BOG shall pay Veritas an amount (hereinafter
referred to as the "Pay Off Amount") equal to the sum obtained by subtracting
1) all amounts already paid by BOG to Veritas pursuant to the terms of Sections
3.1, 3.4 and 3.5 above, from 2) the sum of (A) all Seismic Acquisition Costs
(determined in accordance with the provisions of Exhibit B for each of the
applicable Project Areas) incurred in conducting the 3-D Operations during such
eighteen month period within BOG Project Areas, less and except any Seismic
Acquisition Costs related to the Excluded Lands, and (B) an amount equal to the
product obtained by multiplying (i) the number obtained by dividing (a) the
number of square miles which were covered by 3-D Operations that were conducted
hereunder during such eighteen month period by (b) five hundred, times (ii) one
million dollars. In such event, such payment shall be made to Veritas

Anadarko Basin
Seismic Operations Agreement

9
<PAGE> 10

within thirty (30) days of the expiration of such eighteen month period and
shall be in full and complete settlement and satisfaction of all obligations
hereunder. Upon making the payment described in this Section 3.9, BOG shall
own all interest in the Program Data (as defined below) which has resulted from
the 3-D Operations conducted within the Alliance Area. The payment by BOG to
Veritas hereunder of the Pay Off Amount shall be the sole and exclusive remedy
of Veritas for the failure of BOG to make sufficient Project Areas ready for
3-D Operations hereunder, and Veritas hereby waives any other remedy, damages
and/or cause of action it may otherwise have had against BOG, whether in law or
in equity. The Parties recognize and agree that BOG's payment of the Pay Off
Amount will not extinguish BOG's responsibility to reimburse Veritas for all
actual permit and damage settlement payments incurred prior to the termination
of this Agreement as set forth in Section 3.8 above and BOG shall remain
responsible for such payments in accordance with the terms of Section 3.8
above.

ARTICLE IV
OWNERSHIP AND USE OF SEISMIC DATA

Section 4.1. Ownership of the Program Data. Except as provided
above in Section 3.9 and below with respect to seismic data that covers
Excluded Lands, Terrain Excluded Project Areas and Sand Tire Excluded Project
Areas, and subject to the other terms of this Article IV, Veritas shall own one
hundred percent of the ownership interest in the seismic data that results from
the 3-D Operations (hereinafter referred to as "Program Data") conducted within
Project Areas hereunder until such time as the First Payout occurs. Once the
First Payout occurs BOG and Veritas shall each own an undivided fifty percent
interest in all of the Program Data. Then, if Final Payout occurs prior to the
expiration of the Exclusivity Period, upon the occurrence of Final Payout BOG
shall own one hundred percent of the ownership interest in all of the Program
Data. Anything to the contrary contained in this Agreement notwithstanding, in
the event that BOG designates Excluded Lands and pays for the costs described
in Section 3.3 above, BOG shall own one hundred percent of the ownership
interest in the Program Data covering such Excluded Lands. The Parties also
recognize and agree that in no event shall Veritas own any interest in any
Program Data which BOG may obtain within Terrain Excluded Project Areas or Sand
Tire Excluded Project Areas. In addition, anything to the contrary contained
in this Agreement notwithstanding, in the event that BOG is required to make
the payment which is described in Section 3.9 above, BOG shall own one hundred
percent of the ownership interest in the Program Data which has resulted from
all of the 3-D Operations conducted hereunder.

Section 4.2. BOG Right to Contribute Toward Final Payout. In the
event that Final Payout has not been reached prior to the expiration of the
Exclusivity Period, BOG shall nonetheless have the option to acquire one
hundred percent of the ownership interest in the Program Data by paying Veritas
the amount which is necessary to cause Veritas to have received the Final
Payout Amount. To exercise such option, BOG must notify Veritas in writing
that it is exercising such option prior to the expiration of the Exclusivity
Period. In the event that BOG exercises the option to acquire all interest in
the Program Data as provided herein, BOG shall remit payment for the amount
necessary to cause Veritas to have received the Final Payout Amount within
thirty days of the expiration of the Exclusivity Period.

Section 4.3. Program Data to Remain Clear of Liens and
Encumbrances. Anything to the contrary contained herein notwithstanding,
Veritas shall not allow its interest in the Program Data to be burdened or
encumbered with any liens, mortgages or other burdens of any kind unless, until
and to the extent that Veritas has retained ownership interest in the Program
Data after the expiration of the Exclusivity Period. Anything to the contrary
contained herein notwithstanding, BOG shall not burden or encumber the Program
Data with any liens, mortgages or other burdens of any kind unless and until
BOG has received an ownership interest in the Program Data. The Parties agree
that in exercising their rights to have liens, mortgages or other burdens
attached to the Program Data as allowed in this Section 4.3, neither Party
shall have the right to burden or encumber the other Party's ownership interest
in the Program Data.

Section 4.4. Veritas' Rights to Sale, Exchange and/or Disclose the
Program Data. Anything to the contrary contained herein notwithstanding,
Veritas agrees that it will not sell, license, trade, exchange or in any way
disclose the Program Data (or any part thereof) or any

Anadarko Basin
Seismic Operations Agreement

10
<PAGE> 11

information related to the Program Data, in any format or manner, or negotiate
or advertise for the potential sale, license, trade, exchange or other
disclosure of the Program Data (or any part thereof), prior to the expiration
of the Exclusivity Period. In addition, in the event that BOG ends up owning
one hundred percent of the ownership interest in all or part of the Program
Data as provided herein, Veritas shall not ever have the right to sell,
license, trade, exchange or otherwise disclose the Program Data or any
information related to the Program Data.

Section 4.5. Proceeds resulting from Sale or Licensing of Program
Data. In the event that after the expiration of the Exclusivity Period BOG and
Veritas each own an undivided fifty percent interest in the Program Data, if
either BOG or Veritas subsequently sells or licenses the Program Data for cash
consideration, the Parties shall each receive fifty percent of the cash
consideration received as the result of such sale or licensing; provided,
however, that the Party that licenses or sales the Program Data as aforesaid
shall have the right to deduct from the other Party's share of the cash
consideration fifty percent of the reasonable costs and expenses which have
been incurred in licensing or selling such Program Data. In the event that
either Party hereto trades, exchanges or licenses the Program Data in
conformance with the other terms that are contained in this Article IV, as long
as such exchange, trade or licensing does not involve the payment of cash
consideration, the trading, exchanging or licensing Party will not owe any
consideration of any kind to the other Party hereto as a result of such
transaction, even though such other Party may own part of the ownership
interest in the Program Data.

Section 4.6. BOG's and BOG Participants' Right to Utilize the
Program Data. Whether or not BOG owns any ownership interest in the Program
Data, at all times BOG and the BOG Participants shall have all rights to
utilize, copy, trade, exchange and disclose the Program Data in pursuit of
their oil and gas exploration and/or development operations within the
applicable Project Areas. In the event that Veritas owns an interest in the
Program Data following the expiration of the Exclusivity Period as provided
herein, BOG shall provide Veritas with a list of the names of the companies
with whom BOG has traded or exchanged all or parts of the Program Data as
allowed hereunder, together with a description of the Program Data which has
been traded or exchanged with each such company.

ARTICLE V.
VERITAS NON-COMPETE

Section 5.1. Veritas Agreement Not to Compete. Veritas hereby
agrees that for a period of six years from the date of this Agreement neither
Veritas, its successors or assigns or any of their affiliated companies
(hereinafter referred to as the "Veritas Group") shall compete with BOG or any
of the BOG Participants within one mile of the outside perimeter of any Project
Areas which are designated by BOG hereunder, by owning or acquiring any
leasehold, mineral or royalty interest within such area, either directly or
indirectly, through any agents, nominees, or representatives, unless purchased
or acquired from BOG or a BOG Participant. In the event that any member of the
Veritas Group breaches the non-compete provisions contained in this Section
5.1, in addition to any other remedies that may be available to BOG and each
BOG Participant at law or in equity, upon BOG's or any BOG Participant's
request, Veritas shall cause the interests that have been acquired in breach of
the provisions contained in this Section 5.1, to be assigned to BOG or such BOG
Participant without reimbursement for any costs incurred in obtaining such
interests. The Parties agree that for purposes of this Section 5.1 the
"outside perimeter of each Project Area" shall include all lands that are
located within the outside perimeter of the area that is depicted on the final
bin/fold map resulting from the 3-D Operations which is provided by the seismic
processor. Following the completion of final processing of the Program Data
resulting from a Project Area BOG shall prepare a legal description of the
acreage which is located within the outside perimeter depicted on the final
bin/fold map for such Project Area and the Parties agree that such legal
description shall constitute the outside perimeter of the Project Area for
purposes of this Section 5.1. BOG shall use reasonable efforts to cause the
legal description to depict the outside perimeter of the area that is depicted
on the final bin/fold map which is provided by the seismic processor; however,
the Parties recognize that in order to provide a legal description of such area
BOG shall not be required to have a survey conducted on the ground and may
approximate, in its sole and reasonable discretion, the location of the outside
perimeter depicted on the final bin/fold map for purposes of aiding BOG in the
preparation of the legal

Anadarko Basin
Seismic Operations Agreement

11
<PAGE> 12

description. Anything to the contrary contained in this Section 5.1
notwithstanding, in the event that following the expiration of the Exclusivity
Period Veritas owns an interest in the Program Data as provided herein, the
terms and provisions of this Section 5.1 shall not be construed to impede
Veritas' ability to sell, license, trade or exchange the Program Data in
accordance with the provisions of Article IV above.

ARTICLE VI.
MISCELLANEOUS

Section 6.1. Assignments. BOG shall have the right to assign or
convey all or any part of its rights, obligations or interests under this
Agreement provided that such assignment is made subject to all of the terms and
provisions of this Agreement; provided, however, that prior to the expiration
of the Exclusivity Period BOG shall not assign or convey all of its interests
under this Agreement. Veritas shall not have the right to assign or convey all
or any part of its rights, obligations or interests under this Agreement.

Section 6.2. Merger. This Agreement supersedes any and all prior
and existing agreements, whether oral or in writing, between any of the Parties
hereto with respect to the subject matter hereof and contains all of the
covenants and agreements between the Parties with respect to the subject matter
hereof.

Section 6.3. Notices. All notices and other communications
required or permitted under this Agreement shall be in writing, and shall be
delivered personally, or by telecopier or delivery service, to the addresses
set forth opposite the signatures of the Parties below, and shall be considered
delivered upon the date of receipt. Each Party may specify its proper address
or any other address by giving notice to other Parties, in the manner provided
in this section, at least ten days prior to the effective date of such change
of address.

Section 6.4. Right to Specific Performance. Each Party
acknowledges 1) that its obligations under this Agreement are unique and 2)
that the other Parties would be irreparably damaged and would not have an
adequate remedy at law for damages if such Party defaults in its obligations
hereunder. Each Party expressly waives the defense that a remedy in damages
will be adequate. If any Party should default in its obligations hereunder,
each non-defaulting Party, in addition to any other available rights or
remedies, may sue in equity for specific performance or injunctive relief.

Section 6.5. Governing Law. THIS AGREEMENT AND ALL MATTERS
PERTAINING THERETO, INCLUDING, BUT NOT LIMITED TO, MATTERS OF PERFORMANCE,
NON-PERFORMANCE, BREACH, REMEDIES, PROCEDURES, RIGHTS, DUTIES, AND
INTERPRETATIONS OR CONSTRUCTION, SHALL, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW, BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS. THE PARTIES
AGREE THAT THE EXCLUSIVE VENUE FOR ANY DISPUTES OR CLAIMS ARISING HEREUNDER OR
IN ANY WAY RELATED HERETO SHALL BE IN DALLAS COUNTY, TEXAS.

Section 6.6. Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be binding upon the signing Party or
Parties thereto as fully as if all Parties had executed one instrument, and all
of such counterparts shall constitute one and the same instrument. If
counterparts of this Agreement are executed, the signatures of the Parties, as
affixed hereto, may be combined in and treated and given effect for all
purposes as a single instrument.

Anadarko Basin
Seismic Operations Agreement

12
<PAGE> 13

IN WITNESS WHEREOF this Agreement is executed by the Parties on the
dates set forth opposite their respective signatures below but is effective for
all purposes as of the date first set forth above.

Address: VERITAS GEOPHYSICAL, LTD.
860 West Airport Freeway
Suite 509
Hurst, Texas 76054
Phone: (817) 498-1383
Fax: (817) 498-1256
Dated: 4/5/96 By: /s/ MARK HOLLAND
--------------------- --------------------------------
(name printed) Mark Holland
--------------------
Its: Operation Manager
------------------------------

Address: BRIGHAM OIL & GAS, L.P.,
5949 Sherry Lane by Brigham Exploration Company,
Suite 1616 its Managing General Partner
Dallas, Texas 75225
Phone: (214) 360-9182
Fax: (214) 360-9825
Dated: 4/5/96
--------------------- By: /s/ BEN M. BRIGHAM
--------------------------------
Ben M. Brigham, President/CEO

Anadarko Basin
Seismic Operations Agreement

<PAGE> 1
EXHIBIT 10.15.1
[BRIGHAM OIL & GAS, L.P. LETTERHEAD]

June 10, 1996

Via Overnight Delivery
Veritas Geophysical Ltd.
860 West Airport Freeway, Suite 509
Hurst, Texas 76054
Attention: Mr. Edward Compton

Re: Anadarko Basin Seismic Operations Agreement dated
February 15, 1996, by and between Brigham Oil & Gas,
L.P. ("BOG") and Veritas Geophysical, Ltd.
("Veritas") (hereinafter referred to as the "Alliance
Agreement")

Dear Ed:

This letter amendment sets forth BOG's and Veritas' agreement to amend
the Alliance Agreement to exclude our Cornhusker Project from the Alliance
Agreement and to set forth our new arrangement for the acquisition of sand
tires for the Alliance Seismic Crew's vibrator trucks.

The parties hereto agree that the 3-D seismic operations being
conducted for BOG's Cornhusker Project, located in Wheeler and Hemphill
Counties, Texas, are being conducted by Veritas pursuant to a separate Basic
and Supplemental Agreement executed by the parties and, therefore, such
Cornhusker Project and the 3-D seismic operations conducted therein are hereby
excluded from the Alliance Agreement. The parties hereto agree that the first
BOG Project Area which shall be the subject of the Alliance Agreement shall be
the Gold Project Area for which field seismic operations are expected to
commence around June 24, 1996.

II.

As 3-D Operations for the first Project Area under the Alliance
Agreement are not expected to commence until some time after the start of the
Cornhusker Project, the parties hereby agree that the term for conducting 3-D
Operations under the Alliance Agreement shall be increased from eighteen months
to twenty-three months. As such, the parties hereto agree that the Alliance
Agreement is hereby amended such that everywhere the word "eighteen" appears in
Sections 2.2, 2.5 and 3.9 of the Alliance Agreement, such term shall be
replaced with the word "twenty-three."
<PAGE> 2
Veritas Geophysical, Ltd.
Alliance Agreement Amendment
June 10, 1996
Page 2

III.

The parties have also agreed that model 28-L-26 ANS Goodyear Tractor
Tires with Diamond Tread, or the equivalent thereof, are to be acquired by
Veritas immediately and placed on the Alliance Seismic Crew's vibrator trucks.
For a period of five years from the date of this letter agreement, or for the
useful life of the tires, whichever comes first, Veritas shall maintain the
acquired sand tires and BOG shall receive priority use of such sand tires for
3-D Operations which are conducted for BOG by Veritas. During the term of the
Alliance Agreement the Alliance Seismic Crew's vibrator trucks shall always be
equipped with the acquired sand tires unless BOG notifies Veritas otherwise.
As such, the parties agree that Section 2.7 of the Alliance Agreement is hereby
deleted in its entirety and replaced with the following:

Section 2.7. Sand Tire Provisions. The Parties agree that
Veritas shall immediately purchase and acquire sufficient model
28-L-26 ANS Goodyear Tractor Tires with Diamond Tread, or the
equivalent thereof, to equip five of the Alliance Seismic Crew's
vibrator trucks with such sand tires. During the term of this
Agreement, five of the Alliance Seismic Crew's vibrator trucks shall
always be equipped with such acquired sand tires unless BOG notifies
Veritas otherwise.

The parties hereto also agree that the Vibrator section of Exhibit E
to the Alliance Agreement is hereby deleted in its entirety and replaced with
the following:

5-6 - Vibrators. Current configurations include Mertz 18 buggy
mounted (44,250 pounds peak force), Hemi 48 buggy mounted
(47,700 pounds peak force) and Mertz 18 HD buggy mounted
(51,240 pounds peak force) units. Five (being the Vibrators
in use) of the Vibrators are to be equipped with model 28-L-26
ANS Goodyear Tractor Tires with Diamond Tread, or the
equivalent thereof, unless BOG requests otherwise. All
Vibrators shall be equipped with Pelton Advance II
electronics, and Vibra *Sig QC software.

As the parties have now agreed to the provision of the above-described
tires, the parties agree that the Sand Tire Exception and the "Sand Tire
Excluded Project Area" concept is deleted from the Alliance Agreement
everywhere it appears in same.

As consideration for Veritas' acquisition of the model 28-L-26 ANS
Goodyear Tractor Tires with Diamond Tread, or the equivalent thereof, as
described above, the parties agree that the Turnkey Charge in Section 3.2 shall
be increased in amount by $38.00 per square mile. As such, the parties hereto
agree that Subsection J of Section 3.2 of the Alliance Agreement is hereby
deleted in its entirety and replaced with the following:

J. The Total Turnkey Charge per square mile for a
Project Area is then determined by adding together (i) twenty-five
percent (25%) of the AVG, (ii) seventy-five percent (75%) of the RRLLN
for the longest receiver line in the Project Area, and (iii)
<PAGE> 3
Veritas Geophysical, Ltd.
Alliance Agreement Amendment
June 10, 1996
Page 3

thirty-eight dollars. The Total Turnkey Charge per square mile for a
Project Area being referred to in this Section 3.2 as the "TTCPM."

Therefore, the Turnkey Charge per square mile which is set forth in the two
examples contained in Exhibit C to the Alliance Agreement shall be increased by
$38.00 as follows:

Project Area
Example A
Turnkey Charge Per Square Mile
= (.25 * AVG) + (.75 * longest RRLLN) + $38
= (.25 * $15,056) + (.75 * $15,788) + $38
= $3,764 + $11,841 + $38
= $15,643

Project Area
Example B
Turnkey Charge Per Square Mile
= (.25 * AVG) + (.75 * longest RRLLN) + $38
= (.25 * $14,644) + (.75 * $15,265) + $38
= $3,661 + $11,449 + $38
= $15,148

The parties agree that the consideration described above covers the
cost of initially transporting and installing the model 28-L-26 ANS Goodyear
Tractor Tires with Diamond Tread (or the equivalent thereof) on the Alliance
Seismic Crew's Vibrators and any costs which are incurred by Veritas in the
event that different Vibrators are used for the Alliance Seismic Crew and thus
Veritas must transport and/or install the tires on different Vibrators.
However, in the event that BOG requests that other tires be utilized for any
Project Area and then decides to utilize the model 28-L-26 ANS Goodyear
Tractor Tires with Diamond Tread (or the equivalent thereof) for a subsequent
Project Area, BOG shall pay the actual costs incurred to truck the model
28-L-26 ANS Goodyear Tractor Tires with Diamond Tread (or the equivalent
thereof) to the Alliance Seismic Crew. As such, the parties hereto agree that
the fifth item of the "Excluded From the Turnkey Rate" Section of Exhibit B
which provides that the cost of trucking sand tires is excluded from the
Turnkey Charge, is hereby deleted in its entirety and replaced with the
following:

- In the event that BOG requests that the Alliance Seismic
Crew's vibrators utilize tires other than the model 28-L-26
ANS Goodyear Tractor Tires with Diamond Tread (or the
equivalent thereof) for a Project Area and then decides to
utilize the model 28-L-26 ANS Goodyear Tractor Tires with
Diamond Tread (or the equivalent thereof)for a subsequent
Project Area, BOG shall pay the actual costs incurred to truck
the model 28-L-26 ANS Goodyear Tractor Tires with Diamond
Tread (or the equivalent thereof) back to the Alliance Seismic
Crew for such subsequent Project Area.
<PAGE> 4
Veritas Geophysical, Ltd.
Alliance Agreement Amendment
June 10, 1996
Page 4

If this letter amendment correctly sets forth Veritas' agreement and
understanding with respect to the subject matter hereof, we ask that you have
an authorized representative of Veritas execute the duplicate originals of same
below and return one of such fully executed duplicate originals to our offices.

Sincerely,
BRIGHAM OIL & GAS, L.P.
by Brigham Exploration Company,
its Managing General Partner

/s/ BEN M. BRIGHAM
Ben M. Brigham, President / CEO

ACCEPTED AND AGREED this ___ day of ________ , 1996:

VERITAS GEOPHYSICAL, LTD.

By: /s/ EDWARD COMPTON
--------------------------------
(name printed) Edward Compton
---------------------
Its: Operator Supervisor
-------------------------------

<PAGE> 1
EXHIBIT 10.16

EXPENSE ALLOCATION AND PARTICIPATION AGREEMENT

R E C I T A L S:

A. Brigham Oil & Gas, L.P., a Delaware limited partnership
("BOG"), is active in the exploration and development of oil and gas properties
in the domestic United States.

B. Gasco Limited Partnership a West Virginia limited partnership
("Gasco"), desires to participate with BOG in the drilling of wells on
properties owned or hereafter acquired, in whole or in part, by BOG, during the
term hereof and otherwise upon and subject to the provisions herein contained.

A G R E E M E N T:

FOR A GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of
which are hereby acknowledged, BOG and Gasco hereby act, agree and covenant as
follows:

Section 1. DEFINED TERMS. As used herein, the following terms shall
have the following meanings:

"Affiliate" means, with respect to any Person: (a) any other
Person directly or indirectly owning, controlling or holding with
power to vote 10% or more of the outstanding voting securities of such
Person, (b) any other Person 10% or more of whose outstanding voting
securities are directly or indirectly owned, controlled or held with
power to vote by such Person, and (c) any other Person directly or
indirectly controlling, controlled by or under common control with
such Person.

"Agreement Term" means the period beginning on the date hereof
at 7:00 a.m. Dallas, Texas local time, and ending on the earlier to
occur of (i) March 31, 1997, at 11:59 p.m. Dallas, Texas local time,
or (ii) the date on which Gasco's 25% share of the Drilling Costs
incurred in drilling the Subject Wells and Subsequent Wells equals or
exceeds $1,500,000.00. However, in the event that it reasonably
appears to BOG that such $1,500,000.00 amount will be reached before
March 31, 1997 based upon the Drilling Costs incurred to that point in
time and BOG's estimate of future Drilling Costs, BOG shall give Gasco
written notice that such amount will probably be reached before March
31, 1997 and Gasco shall have the option to nonetheless extend the
term of this Agreement to 11:59 p.m. Dallas, Texas local time on March
31, 1997, by giving BOG written notice of such extension no less than
fifteen (15) days after Gasco's receipt of BOG's notice. Anything to
the contrary contained herein notwithstanding, Gasco shall have the
one time option to terminate this Agreement and the Agreement Term
effective as of 7:00 a.m. Dallas, Texas local time on July 1, 1996.
To exercise such option to end the Agreement Term effective as of 7:00
a.m. Dallas, Texas local time on July 1, 1996, Gasco must cause
written notice of such election to be delivered to BOG's offices on or
before 5:00 p.m. Dallas, Texas local time on May 20, 1996.

"Applicable Environmental Laws" means any federal, state
and/or local laws, rules, orders or regulations, whether now existing
or hereafter enacted, modified or amended, relating to health or to
the protection of the environment, including without limitation the
Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended by the Superfund Amendments and Reauthorization
Act of 1986, the Resource Conservation and Recovery Act of 1976, a
amended by the Used Oil Recycling Act of 1980, the Solid Waste
Disposal Act Amendments of 1980, and the Hazardous and Solid Waste
Amendments of 1984.

"Assigned Interests" shall have the meaning assigned to it in
Section 9 hereof.

"Assignment" means any assignment executed pursuant to Section
9 hereof by BOG in favor of Gasco.

"BOG Account" shall be the BOG bank account designated by BOG
to Gasco in writing from time to time.
<PAGE> 2
"BOG Account Balance" means the balance of the funds that have
been deposited into the BOG Account for Gasco's share of BOG Drilling
Costs and BOG Completion Costs which have not yet been paid or
advanced to the drilling operator, together with any interest earned
from such funds in the BOG Account, net of all bank fees and other
charges incurred with respect to the BOG Account.

"BOG Completion Costs" means, with respect to any particular
Subject Well or Subsequent Well, BOG's share of the Completion Costs
associated with such Subject Well or Subsequent Well. For purposes of
the foregoing, "BOG's share" of Completion Costs shall be determined
based upon the share of Completion Costs allocable to BOG Properties
(a) without regard to any other agreement whereunder a third party
agrees to carry BOG for all or any portion of what would otherwise be
BOG's share of Completion Costs relative to any particular Subject
Well or Subsequent Well, (b) without regard to any agreement
whereunder BOG agrees to carry a third party for a share of such third
party's Completion Costs, and (c) with regard to and taking into
account any additional interest (and attendant share of Completion
Costs) in any particular Subject Well or Subsequent Well which BOG may
acquire, temporarily or permanently, due to the election by one or
more third parties not to participate in the Completion of such
Subject Well or Subsequent Well. By way of illustration, assume that
BOG owns (or is entitled to earn, under a BOG Farmout Agreement or
otherwise) a 25% interest in a lease covering 100% of the mineral fee
interest in Tract A, and ABC Oil Company ("ABC") owns 25% and CDE Oil
Company ("CDE") owns the remaining 50% interest. If BOG proposes the
Completion of a Subject Well or Subsequent Well on Tract A and all of
BOG, ABC and CDE elect to participate therein, BOG's share of the
Completion Costs associated with such well would, in typical
circumstances, be 25%. If, however, ABC elects not to participate in
the Completion of the well and BOG and CDE elect to proceed to
Complete the well and each acquire a proportionate part of ABC's
non-consent interest, BOG's share of the Completion Costs would, in
typical circumstances, be 33.333%. In the event ABC has the right to
again participate in the well after, for example, payout of a
nonconsent penalty, the interests of BOG and Gasco shall both
proportionately be reduced to take into account the after payout
interest of ABC. In both of the examples set out above, assume
further that XYZ Oil Company ("XYZ") has agreed to carry BOG for 50%
of what would otherwise be BOG's share of Completion Costs in order to
earn 25% of BOG's interest in the well. Under such circumstances, the
BOG Completion Costs shall be determined without regard to XYZ's
agreement to pay 50% of what would otherwise be BOG's share of the
Completion Costs associated with the well, but the 25% interest BOG is
obligated to assign to XYZ shall be taken into account in determining
the interest in any particular BOG Property subject to this Agreement.
As such, in this example in which XYZ has agreed to pay 50% of BOG's
share of Completion Costs in return for 25% of BOG's interest in the
Subject Well or Subsequent Well, as BOG's interest in the well is
reduced to 18.75% in the example in which all of the parties elected
to participate and to 24.99975% in the example in which ABC elected
not to participate in order to account for XYZ's earned interest, the
BOG Completion Costs associated with such well would be reduced to
BOG's reduced interest in the Subject Well or Subsequent Well.

"BOG Drilling Costs" means, with respect to any particular
Subject Well or Subsequent Well, BOG's share of the Drilling Costs
associated with such Subject Well or Subsequent Well. For purposes of
the foregoing, "BOG's share" of Drilling Costs shall be determined
based upon the share of Drilling Costs allocable to BOG Properties (a)
without regard to any other agreement whereunder a third party agrees
to carry BOG for all or any portion of what would otherwise be BOG's
share of Drilling Costs relative to any particular Subject Well or
Subsequent Well, (b) without regard to any agreement whereunder BOG
agrees to carry a third party for a share of such third party's
Drilling Costs, and (c) with regard to and taking into account any
additional interest (and attendant share of additional Drilling Costs)
in any particular Subject Well or Subsequent Well which BOG may
acquire, temporarily or permanently, due to the election by one or
more third parties not to participate in the drilling of such Subject
Well or Subsequent Well. By way of illustration, assume that BOG owns
(or is entitled to earn, under a BOG Farmout Agreement or otherwise) a
25% interest in a lease covering 100% of the mineral fee interest in
Tract A, and ABC Oil Company ("ABC") owns 25% and CDE Oil Company
("CDE") owns the remaining 50% interest. If BOG proposes the drilling
of a well on Tract A and all of BOG, ABC and CDE elect to participate
therein, BOG's share of the Drilling Costs associated with such well
would, in typical circumstances be 25%. If, however, ABC elects not
to participate in the drilling of the well and BOG and CDE elect to
proceed to drill the well and each acquire their proportionate part of
ABC's non-consent interest, BOG's share of the Drilling Costs would,
in typical circumstances, be 33.333%. In the event ABC has the right
to again participate in the well after, for example,

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<PAGE> 3
payout of a nonconsent penalty, the interests of BOG and Gasco shall
both proportionately be reduced to take into account the after payout
interest of ABC. In both of the examples set out above, assume
further that XYZ Oil Company ("XYZ") has agreed to carry BOG for 50%
of what would otherwise be BOG's share of Drilling Costs in order to
earn 25% of BOG's interest in the Subject Well or Subsequent Well.
Under such circumstances, the BOG Drilling Costs shall be determined
without regard to XYZ's agreement to pay 50% of what would otherwise
be BOG's share of the Drilling Costs associated with the well, but the
25% interest BOG is obligated to assign to XYZ shall be taken into
account in determining the interest in any particular BOG Property
subject to this Agreement. As such, in this example in which XYZ has
agreed to pay 50% of BOG's share of Drilling Costs in return for 25%
of BOG's interest in the Subject Well or Subsequent Well, as BOG's
interest in the well is reduced to 18.75% in the example in which all
of the parties elected to participate and to 24.99975% in the example
in which ABC elected not to participate in order to account for XYZ's
earned interest, the BOG Drilling Costs associated with such well
would be reduced to BOG's reduced interest in the Subject Well or
Subsequent Well.

"BOG Farmout Agreement" means any agreement through which BOG
and Gasco must either provide seismic data, drill a Subject Well or
drill a Subsequent Well in order to earn an assignment of BOG
Properties from a third party.

"BOG Participation Agreements" means any agreements now or
hereafter existing whereunder BOG agrees with certain third parties
upon terms and conditions of joint exploration and/or development of
oil and/or gas properties located in the domestic United States,
including without limitation the existing participation agreements
described in Exhibit A hereto, as same may be amended, modified or
extended from time to time.

"BOG Properties" means BOG's undivided right, title and
interest in and to any property, right or interest that gives BOG the
right to drill for and produce oil, gas and associated hydrocarbons in
any of the lands described in Exhibit B, whether now owned or
hereafter acquired by BOG during the term hereof; BOG Properties shall
in no event include any overriding royalty interest owned by or owing
to BOG, whether pursuant to a BOG Participation Agreement or
otherwise. However, in the event that prior to the Completion of a
Subject Well BOG has assigned or has agreed to assign interests in
properties, rights or interests which are related to such Subject Well
or the Drilling and Production Unit for the applicable Subject Well,
the interests in such properties, rights or interests which BOG has
assigned or agreed to assign shall not be part of the BOG Properties
for purposes of this Agreement; provided, however, that the interests
BOG has agreed to assign to Middle Bay Oil Company, Inc. pursuant to
the terms of that certain Expense Allocation and Participation
Agreement dated April 1, 1996 by and between BOG and Middle Bay, shall
be deemed to be part of the BOG Properties for purposes of this
Agreement. In addition, anything to the contrary contained herein
notwithstanding, in the event that BOG Drilling Costs with respect to
any particular Subject Well are estimated, as set out in the initial
authority for expenditure or "AFE" circulated for the drilling of such
Subject Well (which AFE may be circulated by BOG or by some third
party), to exceed $280,000.00, BOG's undivided interests in and to the
properties, rights and interests included in the Drilling and
Production Unit for such Subject Well shall be reduced in the same
percentage by which the estimated BOG Drilling Costs exceed
$280,000.00, and that reduction amount shall not be a part of the BOG
Properties and shall otherwise be excluded from this Agreement for all
purposes. By way of illustration, assume that (a) the estimated BOG
Drilling Costs for any particular Subject Well is $336,000.00 and thus
exceeds the amount of $280,000.00 by exactly 20%, (b) the Drilling and
Production Unit for such Subject Well covers 80 acres and as part of
the BOG Properties BOG owns and undivided 70% interest in an oil and
gas lease (for purposes of this example referred to as the "Lease")
covering 60 net mineral acres in such Drilling Unit and an undivided
40% interest in the minerals (for purposes of this example referred to
as the "Minerals") covering the other 20 net mineral acres in the
Drilling and Production Unit. Under this example, 20% of BOG's
interest in both the Lease and the Minerals would be excluded from the
BOG Properties; as such, an undivided 56% (i.e. 80% of BOG's 70%)
interest in the Lease and an undivided 32% (i.e. 80% of BOG's 40%)
interest in the Minerals would constitute the BOG Properties for the
Drilling and Production Unit for such Subject Well. Notwithstanding
any provision hereof to the contrary, the original estimate of BOG
Drilling Costs as set forth in the initial AFE circulated relative to
any Subject Well will always, unless BOG and Gasco mutually agree to
the contrary,

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<PAGE> 4
definitely be utilized for purposes of determining whether and by how
much the above-described $280,000.00 benchmark has been exceeded.

"Casing Point" means the time when the well has been drilled
to the objective depth stated in the initial notice, appropriate tests
have been made, and the drilling operator notifies all of the
participating parties of his recommendation with respect to completing
or plugging and abandoning the well.

"Complete" or "Completion" means a single operation designed
to complete a Subject Well or Subsequent Well as a producer in one or
more zones, including without limitation the setting of production
casing, perforating, and, where necessary or appropriate, well
stimulation.

"Completion Costs" means the costs and expenses associated
with any attempted Completion of a Subject Well or Subsequent Well.
In addition, in the event that Completion operations are attempted
within a well but the well is not ultimately completed as a producer,
the costs incurred to plug and abandon such well shall also constitute
Completion Costs for purposes of this Agreement.

"Consent" means any right of a third party to grant or deny
its consent to the execution of this Agreement or the consummation of
all or any part of the transactions contemplated herein, including
without limitation any consents provided for or otherwise disclosed in
the existing BOG Participation Agreements.

"Drilling Costs" means all costs and expenses related to (a)
the preparation for drilling and then the drilling and equipping of a
well up and to Casing Point, and (b) all activities associated with
plugging and abandoning a well in which Completion operations have not
been attempted. Without limitation of the generality of the
foregoing, Drilling Costs shall include all costs associated with (i)
clearing and building a location and creating or improving access to
such location (e.g., by building roads), (ii) setting surface casing,
and (iii) logging and testing the well prior to the commencement of
Completion operations.

"Drilling and Production Unit" means, with respect to any
particular well, the acreage allocable, as determined by reference to
the formation initially Completed in such well, to such well under
applicable laws, rules or regulations of governmental authorities
having jurisdiction for the drilling and production of such well at a
legal location and the production from such well of its maximum
allowable, such maximum allowable to be determined by reference to the
lesser of (a) the maximum permissible allowable for such well as set
by any governmental authority having jurisdiction, and (b) such well's
maximum prudent physical productive capability, as determined by
reference to the initial potential test or initial deliverability
test, as the case may be, for such well, limited in each instance to
those depths between the surface and 100 feet below the deepest depth
drilled in the relevant well; the exact configuration of any such
Drilling and Production Unit shall be designated by BOG utilizing
reasonable discretion and good faith. In the event that no
governmental authority having jurisdiction has promulgated any laws,
rules or regulations pursuant to which the Drilling and Production
Unit for any particular well can be determined as set forth in the
immediately preceding sentence, BOG shall, utilizing reasonable
discretion and good faith, designate a Drilling and Production Unit
for such well. However, in the event that after a Drilling and
Production Unit is established for a Subject Well as provided herein,
the Drilling and Production Unit for a Subject Well that has been
completed as a producer is reconfigured or otherwise altered or
changed under law, rule, order or regulation of any governmental
authority having jurisdiction, commencing with the effective date of
such change, the Drilling and Production Unit for such Subject Well
shall be deemed to have been altered as required by the law, rule,
order or regulation and the Parties shall execute all conveyance
instruments necessary to cause Gasco to own the interests (and only
the interests) in the BOG Properties which are included within the
revised Drilling and Production Unit; provided, however, that in the
event that prior to the change in the Drilling and Production Unit a
well has been drilled on acreage (or lands pooled or otherwise
combined therewith) which was not previously included within such
Drilling and Production Unit or BOG has assigned interests in acreage
which was not previously included within such Drilling and Production
Unit, BOG shall not be required to assign such well (or any production
therefrom) or interests to Gasco despite the later inclusion of such
well or acreage in the Drilling and Production Unit. Similarly, in
the event that prior to a change in a Drilling and Production Unit a
Subsequent Well has been drilled on acreage which was previously
included within such Drilling and Production Unit and Gasco
participated in the drilling of such Subsequent Well as provided in

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<PAGE> 5
Section 9(b) below, Gasco shall not be required to assign its interest
in such Subsequent Well (or any production therefrom) to BOG despite
the later exclusion of such Subsequent Well or acreage from the
Drilling and Production Unit. The Drilling and Production Unit for
any particular Subject Well shall in no event include any acreage
and/or depths otherwise allocable to the drilling and spacing,
proration or pooled unit reasonably and in good faith designated by
BOG for any other well, the actual drilling of which was commenced
prior to the date hereof, in which BOG owns an interest and which does
not constitute a Subject Well.

"Initial Deposit" shall have the meaning assigned to it in
Section 8 hereof.

"Initial Period" shall have the meaning assigned to it in
Section 8 hereof.

"Person" means, an individual, corporation, partnership,
limited liability company, association, joint stock company, pension
fund, trust or trustee thereof, estate or executor thereof,
unincorporated organization or joint venture, court or governmental
unit or any agency or subdivision thereof, or any other legally
recognizable entity.

"Preferential Rights" means a preferential right or option in
favor of a third party to acquire all or a portion of a BOG Property,
or to otherwise participate with BOG in the exploration, or
development thereof.

"Routine Governmental Approvals" means the right of any
governmental entity to consent to or approve the transfer of any
interest in a specific BOG Property.

"Seismic Data" means all data secured by or on behalf of BOG
in the conduct of 3-D seismic operations on, across or through the BOG
Properties, including any tapes, reproducibles and interpretations.
Seismic Data shall not include any data which BOG, in its sole and
absolute discretion, deems to be subject to a confidentiality
restriction imposed by or for the benefit of a third party.

"Shortfall Deposit" means any additional funds required to be
deposited by Gasco with BOG pursuant to subsections 8(b)(iii) and
8(c)(iii) hereof.

"Subject Well" means each well on a BOG Property, or on lands
pooled or unitized therewith, for which drilling operations are
actually commenced after the commencement of the Agreement Term and
for which Gasco's share of the BOG Drilling Costs for such well have
been forwarded to the drilling operator for such well prior to the
expiration of the Agreement Term in accordance with the terms of
Section 8 below, regardless of when the well was proposed; the term
Subject Well shall not include (a) any well in the drilling of which
BOG elects not to participate, or (b) any recompletion, deepening,
side track, plug back, rework or other operation in a wellbore already
in existence at the time the subject new operation is proposed. For
purposes of this definition drilling operations for a well shall not
be deemed to have been "actually commenced" unless and until a drill
bit is turning in the ground at the well's surface location utilizing
a drilling rig that is capable of drilling the well to its proposed
total depth. The Parties recognize and agree that any well which is
drilled within the Drilling and Production Unit (or on lands pooled or
unitized therewith) of a well for which drilling operations were
actually commenced prior to the Agreement Term, shall not be a Subject
Well or Subsequent Well for purposes of this Agreement and such a well
shall not be subject to this Agreement, to the effect that Gasco shall
not be obligated to pay any share of the Drilling Costs associated
with any such well or wells and shall further have no right to receive
assignment of any interest therein (or in any Drilling and Production
Unit otherwise allocable thereto). In addition, in the event that BOG
and Gasco mutually so agree with respect to any particular well or
wells proposed to be drilled during the Agreement Term, such well or
wells shall not become Subject Wells and shall otherwise not be
subject to this Agreement, to the effect that Gasco shall not be
obligated to pay any share of the Drilling Costs associated with any
such well or wells and shall further have no right to receive
assignment of any interest therein (or in any Drilling and Production
Unit otherwise allocable thereto).

"Subsequent Deposit" shall have the meaning assigned to it in
Section 8 hereof.

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<PAGE> 6
"Subsequent Period" means each of (a) the period beginning on
July 1, 1996 and ending on September 30, 1996, (b) the period
beginning on October 1, 1996 and ending on December 31, 1996, and (c)
the period beginning on January 1, 1997 and ending on March 31, 1997.

"Subsequent Well" shall have the meaning assigned to it in
subsection 9(b) hereof.

"Termination Amount" means the amount determined utilizing the
following formula:

EW x ADC x AWI x 12.5% x EW - AW
-------
EW

where EW is the number of Subject Wells BOG estimates will be drilled
during the Agreement Term, ADC is the average of BOG's estimate of all
Drilling Costs for EW, calculated based on 8/8ths of such Drilling
Costs, AWI is the average working interest BOG estimates it will have
in the EWs, and AW is the actual number of Subject Wells drilled
hereunder during the Agreement Term and prior to termination of this
Agreement pursuant to Section 10 hereof. For purposes hereof, the
parties stipulate that EW is, based on BOG's estimate, 87 wells, AWI
is, based on BOG's estimate, 25% and ADC is, based on BOG's estimate,
$264,000.

Section 2. REPRESENTATIONS OF BOG. BOG represents to Gasco that:

(a) BOG is a limited partnership, duly formed and legally
existing under the laws of the State of Delaware. BOG has full power
to enter into and perform its obligations under this Agreement and has
taken all appropriate action to authorize entering into this Agreement
and performance of its obligations hereunder. Other than requirements
(if any) that there be obtained Consents or waivers of Preferential
Rights regarding the transfer of specific BOG Properties, and except
for Routine Governmental Approvals which are customarily obtained
post-closing and which BOG has no reason to believe cannot be
obtained, neither the execution and delivery of this Agreement, nor
the consummation of the transactions contemplated hereby, nor the
compliance with the terms hereof, will result in any material default
under any material agreement or instrument to which BOG is a party or
by which the BOG Properties are bound, or violate any order, writ,
injunction, decree, statute, rule or regulation applicable to BOG or
to the BOG Properties. This Agreement constitutes the legal, valid
and binding obligation of BOG, enforceable in accordance with its
terms, except as limited by bankruptcy or other laws applicable
generally to creditor's rights and as limited by general equitable
principles.

(b) There are no suits, actions, claims, investigations,
inquiries, proceedings or demands pending (or, to the best of BOG's
knowledge, threatened) which affect the execution and delivery of this
Agreement, the consummation of the transactions contemplated hereby,
or the BOG Properties, other than as disclosed in Exhibit A.

THE EXPRESS REPRESENTATIONS OF BOG CONTAINED IN THIS SECTION OR IN ANY
ASSIGNMENT EXECUTED PURSUANT HERETO ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER
REPRESENTATIONS AND WARRANTIES, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, AND
BOG EXPRESSLY DISCLAIMS ANY AND ALL SUCH OTHER REPRESENTATIONS AND WARRANTIES.
WITHOUT LIMITATION OF THE FOREGOING, UNDIVIDED INTERESTS EARNED BY GASCO
HEREUNDER IN THE BOG PROPERTIES SHALL BE CONVEYED WITHOUT ANY WARRANTY OR
REPRESENTATION, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, RELATING TO
THE CONDITION, QUANTITY, QUALITY, FITNESS FOR A PARTICULAR PURPOSE, CONFORMITY
TO THE MODELS OR SAMPLES OF MATERIALS OR MERCHANTABILITY OF ANY EQUIPMENT OR
ITS FITNESS FOR ANY PURPOSE AND GASCO SHALL ACCEPT ALL OF THE SAME IN THEIR "AS
IS, WHERE IS" CONDITION. BOG MAKES NO WARRANTY OR REPRESENTATION, EXPRESS,
IMPLIED, STATUTORY OR OTHERWISE, AS TO THE ACCURACY OR COMPLETENESS OF ANY
DATA, INTERPRETATIONS, REPORTS, RECORDS, PROJECTIONS, INFORMATION OR MATERIALS
NOW, HERETOFORE OR HEREAFTER FURNISHED OR MADE AVAILABLE TO GASCO IN CONNECTION
WITH THIS AGREEMENT INCLUDING, WITHOUT LIMITATION, RELATIVE TO SEISMIC OR
GEOLOGICAL MATTERS, PRICING ASSUMPTIONS, OR QUALITY OR QUANTITY OF HYDROCARBON

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<PAGE> 7
RESERVES (IF ANY) ATTRIBUTABLE TO THE BOG PROPERTIES OR THE ABILITY OR
POTENTIAL OF THE BOG PROPERTIES TO PRODUCE HYDROCARBONS OR ANY OTHER MATTERS
CONTAINED IN THE PROPRIETARY DATA OR ANY OTHER MATERIALS FURNISHED OR MADE
AVAILABLE TO GASCO BY BOG OR BY BOG'S AGENTS OR REPRESENTATIVES. ANY AND ALL
SUCH DATA, RECORDS, REPORTS, PROJECTIONS, INFORMATION AND OTHER MATERIALS
(WRITTEN OR ORAL) FURNISHED BY BOG OR OTHERWISE MADE AVAILABLE OR DISCLOSED TO
GASCO ARE PROVIDED GASCO AS A CONVENIENCE AND SHALL NOT CREATE OR GIVE RISE TO
ANY LIABILITY OF OR AGAINST BOG AND ANY RELIANCE ON OR USE OF THE SAME SHALL BE
AT GASCO'S SOLE RISK TO THE MAXIMUM EXTENT PERMITTED BY LAW.

Section 3. REPRESENTATIONS OF GASCO. Gasco represents to BOG that:

(a) Gasco is a limited partnership duly organized and
legally existing under the laws of the State of West Virginia. Gasco
has full power to enter into and perform its obligations under this
Agreement and has taken all appropriate action to authorize entering
into this Agreement and performance of its obligations hereunder.
Neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, nor the
compliance with the terms hereof, will result in any default under any
material agreement or instrument to which Gasco is a party or by which
Gasco is bound, or violate any order, writ, injunction, decree,
statute, rule or regulation applicable to Gasco. This Agreement
constitutes the legal, valid and binding obligation of Gasco,
enforceable in accordance with its terms, except as limited by
bankruptcy or other laws applicable generally to creditor's rights and
as limited by general equitable principles.

(b) There are no suits, actions, claims, investigations,
inquiries, proceedings or demands pending (or, to the best of Gasco's
knowledge, threatened) which affect the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.

(c) Gasco is a knowledgeable purchaser, owner and
operator of oil and gas properties, has the ability to evaluate (and
in fact has evaluated or will evaluate, as the case may be) the BOG
Properties for acquisition, and is acquiring the BOG Properties and
its rights and interests hereunder for its own account and not with
the intent to make a distribution in violation of the Securities Act
of 1933 as amended (and the rules and regulations pertaining thereto)
or in violation of any other applicable securities laws, rules, or
regulations.

Section 4. PREFERENTIAL RIGHTS AND CONSENTS.

BOG will utilize reasonable efforts, consistent with industry
practices in transactions of this type, to identify any Preferential Rights or
Consents which would be applicable to the BOG Properties and the transactions
contemplated hereby. In attempting to identify such Preferential Rights and
Consents, BOG is in no event obligated to go beyond its own records. BOG shall
have no obligation other than to so attempt to identify such Preferential
Rights or Consents and to give the notices required by such identified
Preferential Rights or Consents prior to the drilling of a Subject Well or
Subsequent Well on the applicable BOG Properties. To the extent a Preferential
Right applicable to any BOG Property (or portion thereof) is properly exercised
prior to the execution of an Assignment covering such BOG Property in favor of
Gasco, any well located or proposed to be located on the lands covered by such
BOG Property shall not be considered a Subject Well for purposes hereof, and
Gasco shall have no obligation to pay or bear any BOG Drilling Costs associated
therewith; any share of BOG Drilling Costs paid by Gasco relating to such well
prior to the exercise of the subject Preferential Right shall be reimbursed by
BOG to Gasco. To the extent any Preferential Right applicable to any BOG
Property (or portion thereof) is identified after the date of an Assignment to
Gasco covering such BOG Property, and is further validly and properly exercised
by a third party or third parties after such date, Gasco shall convey the
specific BOG Property affected by such Preferential Right to the exercising
third party or third parties, and Gasco shall be entitled, as its sole remedy
against BOG, to any consideration paid by such party or parties on account of
the post-Assignment exercise of any Preferential Right affecting the BOG
Property. BOG and Gasco hereby recognize that any Preferential Right shall
apply only to the specific property described in the instrument creating same,
and shall in no event be construed to apply to all, or any group of, the BOG
Properties, other than the specific property described in the instrument
creating the Preferential Right. BOG shall use reasonable commercial efforts
to secure any Consent of which it becomes aware (whether such Consent was
identified before or after an Assignment was made covering the BOG Property
burdened by such

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<PAGE> 8
Consent), and to the extent BOG so utilizes reasonable commercial efforts,
whether successful or not, Gasco shall have no legal redress against BOG
relating to any Consent (or the failure to obtain same). Prior to the drilling
of each Subject Well, at Gasco's request, Gasco will be given reasonable
access, in BOG's offices, to BOG's copies of the operating agreements and BOG
Participation Agreements affecting the drilling of such Subject Well.

Section 5. MAINTENANCE OF UNIFORM INTEREST PROVISIONS.

It is hereby recognized that some of the BOG Properties may now be, or
hereafter become, subject to agreements (the "MUI Agreements") containing
maintenance of uniform interest provisions or similar restrictions against
assigning an interest in part, but less than all, of the contract area covered
by such agreement. In this connection, BOG undertakes to use reasonable
commercial efforts to secure waivers from the other parties to each MUI
Agreement that will allow Assignments to be made hereunder. In order to secure
these waivers, BOG may agree that any separate measurement and/or storage
facilities necessitated by an assignment by BOG to Gasco of an interest in
part, but less than all, of the contract area covered by the applicable MUI
Agreement shall be arranged and paid for in equal shares by BOG (50%) and Gasco
(50%). BOG and Gasco further agree that any other costs, liabilities, damages
or obligations, of whatever kind or character, arising out of or relative to
any maintenance of uniform interest or similar provision contained in an MUI
Agreement shall be borne and paid for in equal shares by BOG (50%) and Gasco
(50%).

Section 6. PARTICIPATION IN BOG DRILLING COSTS BY GASCO.

Gasco shall have the obligation to fund 25% of the BOG Drilling Costs
associated with each Subject Well. The election whether or not to participate
in the drilling of any particular well, and thus whether such well becomes a
Subject Well hereunder, will be exercised in the sole and absolute discretion
of BOG; upon an election by BOG to participate in the drilling of any
particular Subject Well, Gasco's obligation to pay 25% of the BOG Drilling
Costs associated with such Subject Well shall become absolute. The Parties
recognize and agree that anything to the contrary contained herein
notwithstanding, in the event that Gasco's share of BOG Drilling Costs have
been forwarded to the drilling operator for a Subject Well prior to the
expiration of the Agreement Term, Gasco's responsibility to fund 25% of the BOG
Drilling Costs associated with such Subject Well shall continue despite the
termination of the Agreement Term.

Section 7. COMPLETION ELECTIONS.

Gasco shall have the obligation to fund 12.5% of the BOG Completion
Costs associated with each Subject Well. In the event there is a separate
Completion point election relative to any particular Subject Well, BOG shall,
in its sole and absolute discretion, make such election for itself and for
Gasco. Any election by BOG to Complete or not to Complete any Subject Well
shall for all purposes be binding upon Gasco, the same as if Gasco had also
made the same election. Gasco shall have the obligation to fund a 12.5% share
of all BOG Completion Costs associated with any Subject Well. The Parties
recognize and agree that anything to the contrary contained herein
notwithstanding, in the event that Gasco's share of BOG Drilling Costs have
been forwarded to the drilling operator for a Subject Well prior to the
expiration of the Agreement Term, Gasco's responsibility to fund 25% of the BOG
Drilling Costs and 12.5% of the BOG Completion Costs associated with such
Subject Well shall continue despite the termination of the Agreement Term.

Section 8. FUNDING AND PAYMENT OBLIGATIONS

(a) Drilling Costs During the Initial Period.

(i) On or prior to the execution hereof, BOG has
provided to Gasco an estimate, determined in BOG's reasonable
discretion, of all BOG Drilling Costs related to Subject Wells
for which costs are estimated to be incurred or advanced
between April 1, 1996 and June 30, 1996 (the "Initial
Period").

(ii) Contemporaneously with the execution of this
Agreement, Gasco shall forward to BOG three hundred
ninety-eight thousand six hundred fifty-one dollars
($398,651.00) (the "Initial Deposit"), in readily available
funds, representing the sum of Gasco's 25% share of the
estimated BOG Drilling Costs

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<PAGE> 9
relating to Subject Wells for the Initial Period estimated to
be incurred or advanced during the Initial Period. BOG shall
deposit such Initial Deposit into the BOG Account.

(iii) It is hereby recognized that the amount of the
Initial Deposit has been calculated based on estimated BOG
Drilling Costs relating to Subject Wells for the Initial
Period. BOG shall have the right from time to time during the
Initial Period to revise its estimate of BOG Drilling Costs
relating to Subject Wells upward. To the extent that the
Deposit Balance is (or is reasonably estimated by BOG to be)
less at any particular time than the sum of Gasco's 25% share
of the revised estimate of BOG Drilling Costs relating to
Subject Wells for the Initial Period, Gasco shall forward to
BOG readily available funds representing 25% of the portion of
the estimated shortfall attributable to BOG Drilling Costs
relating to Subject Wells (which funds shall constitute a
Shortfall Deposit); such Shortfall Deposit shall be made by
Gasco, in immediately available funds, within 15 days after
receipt by Gasco of a written request for the subject
Shortfall Deposit. BOG shall deposit the Shortfall Deposit
into the BOG Account

(iv) BOG shall pay when due, out of and to the
extent of the Initial Deposit and any Shortfall Deposit, the
share of BOG Drilling Costs relating to Subject Wells actually
incurred and charged to the account of Gasco. The balance of
the Initial Deposit and any Shortfall Deposit which has not
been incurred and paid for Gasco's share of BOG Drilling Costs
will be reflected on the books of BOG as a payable to Gasco
until such time as it is applied against Gasco's share of the
BOG Drilling Costs relating to Subject Wells.

(b) Drilling Costs During Subsequent Periods.

(i) Within forty-five days of the first day of each
Subsequent Period, BOG shall provide to Gasco a written
estimate, determined in BOG's reasonable discretion, of the
BOG Drilling Costs relating to Subject Wells for such
Subsequent Period.

(ii) On or before 30 days before the first day of
each Subsequent Period, Gasco shall forward to BOG an amount
(the "Subsequent Deposit"), in readily available funds,
representing the sum of Gasco's 25% share of the estimated BOG
Drilling Costs relating to Subject Wells for such Subsequent
Period estimated to be incurred or advanced during such
Subsequent Period. The amount of each Subsequent Deposit
shall, however, be determined giving due credit to any BOG
Account Balance that is expected to remain unused from a
previous period (i.e., from the Initial Period or a prior
Subsequent Period, as the case may be) and that further is not
earmarked by BOG for payment of Gasco's share of BOG Drilling
Costs relating to Subject Wells for such previous period. BOG
shall deposit each Subsequent Deposit into the BOG Account.

(iii) It is hereby recognized that each Subsequent
Deposit shall be calculated based on estimated BOG Drilling
Costs relating to Subject Wells for the applicable Subsequent
Period. BOG shall have the right from time to time during
each Subsequent Period to revise its estimates of BOG Drilling
Costs relating to Subject Wells for such Subsequent Period
upward. To the extent that the BOG Account Balance is (or is
reasonably estimated by BOG to be) less at any particular time
than the sum of Gasco's 25% share of the revised estimate of
BOG Drilling Costs relating to Subject Wells for the
applicable Subsequent Period, Gasco shall forward to BOG
readily available funds (which shall constitute a Shortfall
Deposit) representing 25% of the portion of the estimated
shortfall attributable to BOG Drilling Costs relating to
Subject Wells; such deposit shall be made by Gasco, in
immediately available funds, within 15 days after receipt by
Gasco of a written request for the Shortfall Deposit. BOG
shall deposit the Shortfall Deposit into the BOG Account.

(iv) During each Subsequent Period BOG shall pay
when due, out of and to the extent of the Subsequent Deposit
and any Shortfall Deposit, the share of BOG Drilling Costs
relating to Subject Wells actually incurred and charged to the
account of Gasco during such Subsequent Period. The balance
of the Subsequent Deposit and any Shortfall Deposit which has
not been incurred and paid for

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<PAGE> 10
Gasco's share of BOG Drilling Costs will be reflected on the
books of BOG as a payable to Gasco until such time as it is
applied against Gasco's share of the BOG Drilling Costs
relating to Subject Wells.

(c) BOG Completion Costs. On or before the 25th day of
each calendar month preceding each calendar month occurring within the
Initial Period and each Subsequent Period, BOG shall provide Gasco
with an estimate, determined in BOG's reasonable discretion, of all of
the BOG Completion Costs relating to Subject Wells estimated to be
incurred or advanced during the next succeeding calendar month. The
amount of each such estimate shall, however, be determined giving due
credit to any BOG Account Balance from the previous month that is
expected to remain unused and that further is not earmarked by BOG for
payment of Gasco's share of BOG Drilling Costs relating to Subject
Wells and/or BOG Completion Costs relating to Subject Wells for such
previous month. On or before the first day of the next succeeding
calendar month Gasco shall pay to BOG, in immediately available funds,
Gasco's 12.5% share of BOG Completion Costs relating to Subject Wells
estimated by BOG to be incurred or advanced during the such calendar
month. BOG shall initially deposit such funds into the BOG Account
and shall withdraw those funds from the BOG Account to pay, when due,
out of and to the extent of such deposit, Gasco's 12.5% share of BOG
Completion Costs relating to Subject Wells which are incurred during
such calendar month. The balance of each monthly deposit which has
not been incurred and paid for Gasco's share of BOG Completion Costs
will be reflected on the books of BOG as a payable to Gasco until such
time as it is applied against Gasco's share of the BOG Completion
Costs relating to Subject Wells.

(d) Reporting. On or before a date that is Forty-five
(45) days after expiration of the previous period (i.e., the Initial
Period or a prior Subsequent Period, as the case may be), BOG shall
provide to Gasco a statement reflecting, on a well-by-well basis,
application of the funds attributable to Gasco's share of BOG Drilling
Costs relating to Subject Wells and BOG Completion Costs relating to
Subject Wells for the previous period; such statement shall be based
on actual numbers, where available, and on estimates, where actuals
are not available.

Section 9. ASSIGNMENTS AND SUBSEQUENT WELLS.

(a) Assignments. BOG shall execute an Assignment in favor of
Gasco covering each Subject Well that is Completed as a producer of
oil, gas and/or associated hydrocarbons; any such Assignment shall be
made on or before the later to occur of (i) thirty business days after
the date the Subject Well was Completed, and (ii) thirty business days
after BOG secures assignment from a third party of all or any portion
of the interest in the Subject Well it is obligated to assign to Gasco
hereunder. Under each Assignment, BOG shall assign to Gasco an
undivided 12.5% interest in and to the BOG Properties related to (A)
the wellbore of any particular Subject Well that is Completed as a
producer of oil, gas and/or associated hydrocarbons, and in and to the
right to produce oil, gas and/or associated hydrocarbons therefrom,
and (B) subject to the limitations and restrictions set forth in
subsection 9(b), below, the Drilling and Production Unit allocable to
such Subject Well. Each Assignment shall be made effective on or
before the date of first production from the Subject Well under
instrument in substantially the form attached hereto as Exhibit C.
Notwithstanding any provision hereof to the contrary, BOG shall not be
obligated to execute any Assignment to Gasco hereunder if Gasco has
failed to fund the BOG Drilling Costs or BOG Completion Costs for any
Subject Well(s) in accordance with the provisions of Section 8 above.
The interest assigned to Gasco under any Assignment (the "Assigned
Interests") shall be burdened by an overriding royalty interest in
favor of BOG (the "BOG ORRI") in the same proportions as the interests
of the participants under the BOG Participation Agreement(s) relating
to such Assigned Interests are burdened by an overriding royalty
interest created or reserved in favor of BOG pursuant to the
applicable BOG Participation Agreement(s). The BOG ORRI shall be
calculated in the same manner, and shall bear the same costs, expenses
and taxes, as the overriding royalty interest of BOG burdening the
interests of the other participants under the BOG Participation
Agreements; provided, however, that in the event that the BOG ORRI
would reduce Gasco's net revenue interest in any of the BOG Properties
included within the Drilling and Production Unit of a Subject Well
below 75%, proportionately reduced to Gasco's interest in the BOG
Properties, with respect to those BOG Properties the amount of the BOG
ORRI shall be reduced to an amount that is equal to the positive
difference, if any, between 25% and the total of all existing royalty
and overriding royally interests burdening such BOG Properties. Any
Assigned Interests shall further bear their proportionate share of any
(i) rights of reversion or conversion in favor of third parties

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<PAGE> 11
that do or may result in the reduction of BOG's interest in the
Assigned Interests or the alteration of such interest (e.g. a back-in
right under a BOG Farmout Agreement), and (ii) royalties, overriding
royalties, production payments and any other burdens against BOG's
interest in, or share of production from, the Assigned Interests, to
the extent same are in existence or owing under documentation in
existence as of the date the Assignment is made.

(b) Subsequent Wells. Any well drilled or commenced to be
drilled, whether during or at any time after expiration of the
Agreement Term, on acreage and to depths included within the Drilling
and Production Unit (or on lands pooled or unitized therewith) for a
Subject Well shall be considered a "Subsequent Well" for all purposes
hereof. Notwithstanding any provision hereof to the contrary:

(i) In the event that both Gasco and BOG elect to
participate under the applicable BOG Participation Agreement,
joint operating agreement or similar agreement governing joint
operations on any Drilling and Production Unit in the drilling
of any particular Subsequent Well, Gasco shall have the
obligation to fund the sum of (A) 12.5% of BOG's share of all
Drilling Costs associated with such Subsequent Well (the "BOG
Carry Amount") and (B) Gasco's own share of the Drilling Costs
associated with such Subsequent Well. Upon an election by
both Gasco and BOG to participate in the drilling of any
particular Subsequent Well, Gasco's obligation to pay all BOG
Carry Amounts associated with such Subsequent Well shall
become absolute. Gasco shall pay over to BOG all BOG Carry
Amounts if and when incurred by BOG; provided that Gasco shall
have 15 business days after receipt from BOG of an invoice for
any particular BOG Carry Amounts to submit payment for same,
in immediately available funds, to BOG.

(ii) In the event that Gasco fails to timely pay any
BOG Carry Amount within 15 days of Gasco's receipt of written
notice of such default from BOG, in addition to, and without
limitation of any remedies that may be available to BOG at law
or in equity, at BOG's option Gasco shall automatically and in
perpetuity forfeit to BOG all of Gasco's right, title and
interest, whether legal or equitable, vested or contingent, in
and to the entire wellbore of the Subsequent Well to which
such BOG Carry Amount relates, together with any right to oil,
gas or other substances that may be produced therefrom and any
proceeds related thereto, free and clear of any liens or
encumbrances created by, through or under Gasco, but not
otherwise, and subject to any superior rights of third parties
under any BOG Participation Agreement, joint operating
agreement or other agreement governing joint operations on the
relevant Drilling and Production Unit to which both Gasco and
BOG are parties or are otherwise bound.

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<PAGE> 12
to 6.25% (i.e. 12.5% x 50%) of the production and allocable
proceeds from the subject Subsequent Well, prior to deduction
of royalties and other burdens, assuming production is
allocable as between Tracts A and B equally (i.e., on a
surface acreage basis); if production is allocable as between
Tracts A and C other than on a surface acreage basis (e.g.,
based on acre-feet), then Gasco's share of production from the
Subsequent Well, again derived only from its 12.5% interest in
Tract A, will be adjusted accordingly. Gasco's allocable
share of Drilling Costs under these facts would be $125,000
(i.e., the sum of (a) 12.5% x 50% x $1,000,000, and (b) the
BOG Carry Amount, which is 12.5% x 50% x $1,000,000), assuming
that Drilling Costs are allocable as between Tracts A and B on
a surface acreage basis; if Drilling Costs are allocable other
than on a surface acreage basis, Gasco's allocable share
thereof, again delivered from both its 12.5% interest in Tract
A and from its obligation to pay and bear the BOG Carry
Amount, shall be adjusted accordingly.

(iv) The provisions of this subsection 9(b) shall be
binding upon and shall enure to the benefit of BOG and Gasco,
and their respective successors and assigns. Any assignment
or other transfer by Gasco of any right, title or interest in
any Drilling and Production Unit established pursuant to this
Agreement shall be made expressly subject to the terms of this
subsection 9(b), and the transferee shall expressly agree to
assume and be bound by the terms of this subsection 9(b); any
attempted assignment or other transfer by Gasco that is not in
compliance with the foregoing shall be void.

Section 10. CONDITIONS PRECEDENT TO BOG PERFORMANCE AND TERMINATION
RIGHTS.

The obligation of BOG under this Agreement to allow Gasco to
participate in the drilling of any particular Subject Well, and to receive
assignment of an undivided 12.5% of BOG's interest therein, is subject to the
fulfillment of each of the following conditions, unless any one or more of same
are waived, in whole or in part, by BOG:

a. Each and every representation of Gasco under this
Agreement shall be true and accurate in all material respects as of
the date when made and shall be deemed to have been made again at and
as of the time of the proposed drilling of each Subject Well, and
shall at and as of the proposed drilling of each Subject Well be true
and accurate in all material respects except as to changes
specifically contemplated by this Agreement or consented to by BOG.

b. Gasco shall have performed and complied in all
material respects with (or compliance therewith shall have been waived
by BOG) each and every covenant, agreement and condition required by
this Agreement to be performed or complied with by Gasco, including
without limitation Gasco shall have timely performed its funding and
payment obligations under Section 8 hereof.

c. No suit, action or other proceedings shall, on the
date of the proposed drilling of each Subject Well, be pending or
threatened against Gasco or BOG before any court or governmental
agency seeking to restrain, prohibit, or obtain damages or other
relief in connection with the consummation of the transactions
contemplated by this Agreement, except to the extent that such suit,
action or other proceedings arise, in whole or in part out of any
action or inaction of BOG in breach of or otherwise in derogation of
this Agreement.

Notwithstanding any provision hereof to the contrary, in the event Gasco fails
at any time or from time to time, within 15 days after receipt of written
notice of default from BOG, to make any payment owing to BOG hereunder or to
otherwise satisfy any funding obligation hereunder, BOG shall have the right,
exercisable in its sole and absolute discretion, to terminate this Agreement,
in which case BOG shall be authorized to receive from Gasco the Termination
Amount. Gasco shall wire transfer to an account or accounts designated by BOG
the Termination Amount within fifteen business days after receipt by Gasco of
BOG's written notice that this Agreement has been terminated pursuant to the
preceding sentence of this Section 10. GASCO AND BOG ACKNOWLEDGE THAT THE
EXTENT OF DAMAGES TO BOG OCCASIONED BY GASCO'S FAILURE TO PROMPTLY PERFORM ITS
PAYMENT OR FUNDING OBLIGATIONS HEREUNDER WOULD BE IMPOSSIBLE OR EXTREMELY
DIFFICULT TO ASCERTAIN AND THAT THE AMOUNT OF THE TERMINATION AMOUNT IS A FAIR
AND REASONABLE ESTIMATE OF SUCH DAMAGES UNDER THE

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<PAGE> 13
CIRCUMSTANCES AND DOES NOT CONSTITUTE A PENALTY. Gasco hereby expressly
recognizes that BOG has a legal right, but not the obligation, to set-off all
or any portion of the BOG Account Balance against Gasco's obligation to pay the
Termination Amount.

Section 11. CONDITIONS PRECEDENT TO GASCO PERFORMANCE.

The obligation of Gasco under this Agreement to fund BOG Drilling
Costs and BOG Completion Costs for the drilling of Subject Wells as set forth
in Section 8 above, is subject to the fulfillment of each of the following
conditions, unless any one or more of same are waived, in whole or in part, by
Gasco:

a. BOG shall have performed and complied in all material
respects with (or compliance therewith shall have been waived by
Gasco) each and every covenant, agreement and condition required by
this Agreement to be performed or complied with by BOG.

b. No suit, action or other proceedings shall, on the
date for funding as set forth in Section 8, be pending or threatened
against Gasco or BOG before any court or governmental agency seeking
to restrain, prohibit, or obtain damages or other relief in connection
with the consummation of the transactions contemplated by this
Agreement, except to the extent that such suit, action or other
proceedings arise, in whole or in part out of any action or inaction
of Gasco in breach of or otherwise in derogation of this Agreement.

Section 12. ASSUMPTION AND REIMBURSEMENT.

Any assignment made by BOG to Gasco hereunder shall be made expressly
subject to any applicable BOG Participation Agreement(s), and any joint
operating agreements related thereto. Gasco agrees to be bound by the terms of
any such BOG Participation Agreement(s) and any related joint operating
agreements, and hereby agrees, effective as of the effective time of the
subject Assignment, to expressly assume a 12.5% share of BOG's obligations
under the applicable BOG Participation Agreements and joint operating
agreement(s), insofar as they pertain to the particular Assigned Interests and
any related facilities. Except as may be provided in the BOG Participation
Agreements which are described in Exhibit A which is attached hereto or as may
be provided in a BOG Farmout Agreement, no BOG Participation Agreement, other
than a BOG Farmout, shall contain provisions which would reduce the net revenue
interest in the BOG Properties to be assigned to Gasco hereunder below 75%
(proportionately reduced to the interest in the BOG Properties to be assigned
to Gasco). Nothing contained in this Section 12 or elsewhere in this Agreement
or any Assignment executed pursuant hereto shall be construed to afford Gasco
any right (and Gasco shall have no right) to participate in production from or
proceeds attributable to any well, other than a Subject Well or a Subsequent
Well, whether drilled under the terms of any particular BOG Participation
Agreement and/or joint operating agreement or otherwise. In addition, nothing
contained in this Section 12 or elsewhere in this Agreement or any Assignment
executed pursuant hereto shall be construed to afford Gasco any right (and
Gasco shall have no right) to participate, as the result of the operation of an
area of mutual interest or similar provision, in any interests acquired by
third party participants under any BOG Participation Agreement or joint
operating agreement.

Section 13. INDEMNIFICATIONS.

(a) INDEMNIFICATIONS BY BOG. BOG agrees to indemnify and
hold harmless Gasco and its officers, directors, employees, agents,
and representatives from and against any and all claims, obligations,
actions, liabilities, damages, or expenses of any kind or character
arising out of or resulting from any agreement, arrangement or
understanding alleged to have been made by, or on behalf of, such
party with any broker or finder in connection with this Agreement or
the transactions contemplated hereby.

(b) INDEMNIFICATIONS BY GASCO.

(i) GENERAL AND ENVIRONMENTAL. NOTWITHSTANDING ANY
PROVISION HEREOF TO THE CONTRARY, GASCO SHALL, FROM AND AFTER
THE EFFECTIVE DATE OF EACH ASSIGNMENT, AGREE TO INDEMNIFY AND
HOLD BOG, ITS OFFICERS, DIRECTORS,

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<PAGE> 14
EMPLOYEES, AGENTS AND REPRESENTATIVES (HEREIN COLLECTIVELY
CALLED THE "BOG INDEMNIFIED PARTIES") HARMLESS FROM AND
AGAINST ANY AND ALL CLAIMS, OBLIGATIONS, ACTIONS, LIABILITIES,
DAMAGES, OR EXPENSES, INCLUDING WITHOUT LIMITATION COURT COSTS
AND ATTORNEYS' FEES (HEREIN COLLECTIVELY CALLED "CLAIMS"), TO
THE EXTENT SUCH CLAIMS AROSE OUT OF THE PHYSICAL CONDITION,
OWNERSHIP AND/OR OPERATION OF THE BOG PROPERTIES COVERED BY
THE SUBJECT ASSIGNMENT AT ANY TIME AFTER THE COMMENCEMENT OF
OPERATIONS FOR THE DRILLING OF THE SUBJECT WELL WHICH RESULTED
IN SUCH ASSIGNMENT, INCLUDING, WITHOUT LIMITATION, ANY CLAIMS
ARISING UNDER, OR AS A RESULT OF VIOLATION OF, APPLICABLE
ENVIRONMENTAL LAWS, WHETHER DUE, IN WHOLE OR IN PART, TO THE
NEGLIGENCE OR STRICT LIABILITY OF BOG, OTHER THAN GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.

(ii) COMMISSIONS. Gasco agrees to indemnify and
hold harmless BOG and the other BOG Indemnified Parties, from
and against any and all claims, obligations, actions,
liabilities, damages, or expenses of any kind or character
arising out of or resulting from any agreement, arrangement or
understanding alleged to have been made by, or on behalf of,
such party with any broker or finder in connection with this
Agreement or the transactions contemplated hereby.

Section 14. WELL DATA AND INFORMATION.

For each Subject Well, BOG shall provide Gasco with the following: (i)
one copy of the AFE submitted for the Subject Well with an estimated working
interest and net revenue interest break down; (ii) one copy of each drilling
and completion report received by BOG for the Subject Well; (iii) one copy of
each well log received by BOG for the Subject Well; and (iv) all data and
information received regarding the testing and analysis of the well. With
respect to each Subject Well which is completed as a producer, following the
completion of such Subject Well BOG shall provide Gasco with a copy of each of
the following documents which are in BOG's possession (i) the BOG Participation
Agreements which affect Gasco's interests in the Drilling and Production Unit
for the Subject Well, (ii) the operating agreements which govern the Drilling
and Production Unit for the Subject Well, and (iii) a copy of each oil and gas
lease and farm-in agreement which covers minerals which are located within the
Drilling and Production Unit for the Subject Well; provided, however, that
Gasco shall reimburse BOG for any third party copying charges which are
incurred to generate such copies. In addition, with respect to each Subject
Well which is completed as a producer, subject to any contractual restrictions
that are placed on such interpretations pursuant to the terms of the applicable
BOG Participation Agreement(s) or the applicable seismic acquisition agreement,
BOG shall provide Gasco with one copy of a 3-D interpretational map generated
from Seismic Data by BOG for each of the targeted zone(s) in such Subject Well
(if a 3-D interpretational map has been generated by BOG for such zone),
limited in geographical extent to 1/2 mile of the outside perimeter of the
Drilling and Production Unit for the Subject Well. Under no circumstances
shall Gasco acquire any ownership interest or license in any of the Seismic
Data.

Section 15. TITLE REVIEW.

To the extent that it is within BOG's control, BOG agrees that a
reasonable title examination shall be performed for each Subject Well prior to
the commencement of actual drilling operations for such Subject Well.

Section 16. NON-COMPETE.

During the Agreement Term and continuing for a period of 5 years
thereafter, unless BOG agrees in writing otherwise, except as provided in this
Agreement, neither Gasco, nor any Affiliate of Gasco, nor any broker or other
representative acting on behalf of Gasco shall own, purchase or otherwise
acquire any interest in the oil, gas and/or other minerals in, under or that
may be produced from any lands located within any of the following described
lands (hereinafter collectively referred to as the "Non-Compete Lands"): (1)
any lands located within one mile of the outside perimeter of the drilling
and/or proration units which are established for each Subject Well; and (2) the
lands which must be the subject of a non-compete agreement as the result of the
disclosure of 3-D interpretational maps or the assignment of interests in BOG
Properties pursuant to the terms of a BOG Participation Agreement which is

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<PAGE> 15
applicable to BOG Properties which are to be assigned to Gasco pursuant to the
terms of this Agreement. The interests Gasco is precluded hereunder from
owning or acquiring include leasehold working interests, mineral fee interests
or servitudes, overriding royalty interests, royalty interests, production
payments, net profits interests, and any other interests, whether similar or
dissimilar, in the oil, gas and/or other minerals in, under or that may be
produced from any part of the Non-Compete Lands. In the event that Gasco, any
Affiliate of Gasco or any broker or other representative acting on behalf of
Gasco or any Affiliate of Gasco owns or acquires any interest in breach of this
Section 16, BOG shall, in addition to any other remedies it may have at law or
in equity, have the right, exercisable in its sole discretion, to secure from
Gasco, an Affiliate of Gasco and/or any broker or other representative acting
on behalf of Gasco or any Affiliate of Gasco, as the case may be, an
assignment, free of all cost and expense, covering the entire interest so owned
or acquired in breach of this Section 16. The provisions of this Section 16
shall survive the expiration of the Agreement Term and any earlier termination
of this Agreement. Anything to the contrary contained in this Section 16
notwithstanding, the parties hereto agree that Gasco shall not be precluded
from acquiring interests from a third party which is a party to a BOG
Participation Agreement, provided that the interest acquired by Gasco from such
third party is subject to the BOG Participation Agreement to which such third
party is a party.

Section 17. ACCOUNTING MATTERS.

On or before a date that is 30 calendar days after the earlier of
expiration of the Agreement Term or termination of this Agreement under Section
10 or Section 11 hereof, BOG shall issue to Gasco a statement reflecting the
BOG Account Balance as of the statement date. Along with said statement, BOG
shall, subject to any right of set-off afforded BOG hereunder, return to Gasco
the BOG Account Balance, less that portion which BOG believes should be
retained by BOG in order to satisfy Gasco's share of any BOG Drilling Costs or
BOG Completion Costs still to be paid or incurred hereunder. On or before a
date that is 120 calendar days after the earlier of expiration of the Agreement
Term or termination of this Agreement under Section 10 or Section 11 hereof,
BOG shall return, subject to any right of set-off afforded BOG hereunder, to
Gasco any of the remaining BOG Account Balance, to the extent it exceeds an
amount sufficient to cover Gasco's share of any then-accrued BOG Drilling Costs
or BOG Completion Costs.

Section 18. INSURANCE.

Gasco agrees to be bound by any election made by BOG concerning
insurance coverage relative to any particular Subject Well, and Gasco shall pay
a 12.5% share of what would otherwise be BOG's insurance costs relative to such
Subject Well and any related facilities. Prior to execution of an Assignment
covering such Subject Well, BOG shall make any insurance elections for and on
behalf of Gasco, and such election shall be binding upon Gasco, the same as if
made by Gasco. For example, if BOG elects to be covered by the operator's
insurance relative to any particular Subject Well, so will Gasco and if BOG
decides to secure or utilize its own insurance coverage relative to any
particular Subject Well, Gasco's interest in the Subject Well shall also rely
upon such insurance coverage; Gasco shall pay a 12.5% share of BOG's costs in
securing insurance coverage relative to any particular Subject Well. If BOG
decides to secure or utilize its own insurance coverage relative to a Subject
Well, Gasco will be named as an additional insured in the certificate issued
for such coverage.

Section 19. NOTICES.

All notices and other communications required under this Agreement
shall (unless otherwise specifically provided herein) be in writing and be
delivered personally, by recognized commercial courier or delivery service
(which provides a receipt), by telex or telecopier (with receipt acknowledged),
or by registered or certified mail (postage prepaid), at the following
addresses:

If to Gasco:
194 Summers Street, 2nd Floor
Charleston, W.V. 25301
Facsimile # (304) 344-2467
Attention: Mr. J. S. Stevens, III

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If to BOG:
Brigham Oil & Gas, L.P.
5949 Sherry Lane, Suite 1616
Dallas, Texas 75225
Facsimile # (214) 360-9825
Attention: Mr. Bud Brigham

and shall be considered delivered on the date of receipt. Either Gasco or BOG
may specify as its proper address any other post office address within the
continental limits of the United States by giving notice to the other party, in
the manner provided in this Section, at least two (2) business days prior to
the effective date of such change of address.

Section 20. SURVIVAL OF PROVISIONS.

All representations, warranties and indemnifications made herein by BOG
or Gasco shall survive in perpetuity the expiration of the Agreement Term and
any termination hereof under Section 10 or Section 11.

Section 21. DISCLAIMERS AND ELECTIONS.

The liabilities of the parties hereunder shall be several, not joint or
collective. It is not the intention of the parties to create, nor shall this
Agreement be deemed as creating, a joint venture, or a mining, tax or other
partnership or association or to render the parties liable as partners.
However, if for federal income tax purposes, this Agreement and the operations
hereunder are regarded as a partnership, each party thereby affected elects to
be excluded from the application of all of the provisions of Subchapter "K,"
Chapter 1, Subtitle "A," of the Internal Revenue Code of 1986, as amended
(hereinafter referred to as the "Code"), as permitted and authorized by Section
761 of the Code and the regulations promulgated thereunder. Should there be
any requirement that each party hereby affected give further evidence of this
election, each such party shall execute such documents and furnish such other
evidence as may be required by the federal Internal Revenue Service or as may
be necessary to evidence this election. No party shall give any notice or take
any other action inconsistent with the election made hereby. In making the
foregoing election, each party states that the income derived by such party
from operations hereunder can be adequately determined without the computation
of partnership income.

Section 22. MISCELLANEOUS MATTERS.

a. Neither Gasco nor BOG shall assign or otherwise transfer any
rights, interests or obligations under this Agreement to any third party
without first obtaining the written consent of the other, which consent
may be either granted or withheld in the sole and absolute discretion of
the party being asked to grant consent; provided that either of BOG or
Gasco may freely transfer or otherwise dispose of all of its rights,
interests and obligations hereunder (i) by sale or other transfer or
disposition of all or substantially all of its assets (whether or not
covered hereby) to an Affiliate or (ii) otherwise by merger,
reorganization or consolidation. This Agreement shall be binding upon
and shall enure to the benefit of Gasco and BOG and their respective
permitted successors and assigns.

b. Each party shall bear and pay all expenses (including without
limitation attorneys' fees) incurred by it in connection with the
transaction contemplated by this Agreement.

c. This Agreement contains the entire understanding of the
parties hereto with respect to subject matter hereof and supersedes all
prior agreements, understandings, negotiations, and discussions among the
parties with respect to such subject matter. The descriptive headings
contained in this Agreement are for convenience only and shall not
control or affect the meaning or construction of any provision of this
Agreement. Within this Agreement words of any gender shall be held and
construed to cover any other gender, and words in the singular shall be
held and construed to cover the plural, unless the context otherwise
requires. Time is of the essence in this Agreement.

-16-
<PAGE> 17
d. This Agreement may be amended, modified, supplemented,
restated or discharged (and provisions hereof may be waived) only by an
instrument in writing signed by the party against whom enforcement of the
amendment, modification, supplement, restatement or discharge (or waiver)
is sought.

e. Without limitation of BOG's right to be paid the Termination
Amount upon terms and conditions set forth in Section 10 above, BOG and
Gasco do hereby covenant and agree that the recovery by either party
hereto of any damages suffered or incurred by it as a result of any
breach by the other party of any provision of this Agreement shall be
limited to the actual damages suffered or incurred by the non-breaching
party as a result of the breach by the breaching party and in no event
shall the breaching party be liable to the non-breaching party for any
interest, consequential, special, exemplary or punitive damages suffered
or incurred by the non-breaching party as a result of the breach by the
breaching party.

f. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS, EXCEPT THAT, TO THE EXTENT THAT THE LAW
OF A STATE IN WHICH A PORTION OF THE BOG PROPERTIES IS NOW OR HEREAFTER
LOCATED (OR WHICH IS OTHER APPLICABLE TO A PORTION OF THE BOG PROPERTIES
NECESSARILY GOVERNS, THE LAW OF SUCH STATE SHALL APPLY TO THAT PORTION OF
THE BOG PROPERTIES LOCATED IN (OR OTHERWISE SUBJECT TO THE LAWS OF) SUCH
STATE.

g. This Agreement may be executed in counterparts, all of which
are identical and all of which constitute one and the same instrument.
It shall not be necessary for BOG and Gasco to sign the same counterpart
and signature pages from different counterparts may be combined to form
masters of this Agreement.

This Agreement is executed by the parties hereto on the date set forth
beneath the signature of each but is effective for all purposes as of April 1,
1996.

BRIGHAM OIL & GAS, L.P.
By: Brigham Exploration Company
Its: Managing General Partner

By: /s/ BEN M. BRIGHAM
---------------------------------
Name: Ben M. Brigham
Title: President/CEO
Date: May 8, 1996

GASCO LIMITED PARTNERSHIP
By: Gasco, Inc.
Its: General Partner

By: /s/ J. S. STEVENS, III
---------------------------------
Name: J. S. Stevens, III
Title: President
Date: May 9, 1996

-17-

<PAGE> 1
EXHIBIT 10.16.1

AMENDMENT

RECITALS:

1. Effective as of April 1, 1996, Brigham Oil & Gas, L.P. ("BOG") and Gasco
Limited Partnership ("Gasco") entered into that certain Expense
Allocation and Participation Agreement (as heretofore amended, herein
called the "Agreement"); all capitalized terms used but not defined
herein shall have the meanings assigned to them in the Agreement.

2. An AFE has been circulated reflecting that the estimated BOG Drilling
Costs associated with the proposed Wiser Mustang No. 1 well (the
"Mustang Well") are $794,208.12, which amount exceeds the $280,000
limitation set forth in the definition of BOG Properties as found in the
Agreement.

AGREEMENT:

FOR A GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which are
hereby acknowledged, BOG and Gasco hereby amend the Agreement such that (a) the
amount of $1,500,000 as found in the definition of Agreement Term shall be
replaced with the amount of $1,580,000, and (b) solely for purposes of the AFE
relating to the Mustang Well, (i) the dollar figure of $280,000 as found in the
Agreement in the third and sixth sentences of the definition of BOG Properties
shall be replaced with the dollar figure of $600,000, and (ii) the fourth
sentence of the definition of BOG Properties shall be replaced with the
following:

"By way of illustration, assume that (a) the estimated BOG Drilling Cost
for the Mustang Well (being a Subject Well) are $720,000 and thus exceed
the amount of $600,000 by exactly 20%, and (b) the Drilling and
Production Unit for such Mustang Well covers 80 acres and as part of the
BOG Properties BOG owns an undivided seventy percent interest in and oil
and gas lease (for purposes of this example referred to as the "Lease")
covering 60 net mineral acres in the Drilling and Production Unit and an
undivided 40% interest in the minerals (for purposes of this example
referred to as the "Minerals") covering the other 20 net mineral acres
in the Drilling and Production Unit."

BOG agrees that, without Gasco's prior consent, BOG shall not propose, or
suggest to the other working interest owners in the Mustang Well, that the
Mustang Well be drilled or deepened to a depth deeper than the total depth set
forth in the AFE. In addition, in the event that any other working interest
owner in the Mustang Well proposes the drilling or deepening of the Mustang
Well to a depth below the total depth set forth in the AFE, unless Gasco agrees
with the proposed deepening operation, BOG agrees to oppose the drilling or
deepening of the Mustang Well below the total depth set forth in the AFE.
<PAGE> 2
MISCELLANEOUS:

1. This Amendment shall be binding upon and shall enure to the benefit of
Gasco and BOG, and their respective successors and assigns, forever.

3. This Amendment shall be governed by and construed in accordance with the
laws of the State of Texas, without regard to principles of conflicts of
laws.

Executed by the parties hereto on the dates set forth below the
signature of each.

BRIGHAM OIL & GAS, L.P.
by Brigham Exploration Company,
its Managing General Partner

By: /s/ ANNE L. BRIGHAM
-----------------------------------------
Anne L. Brigham, Executive Vice President
Date: October 14, 1996
-------------------

GASCO LIMITED PARTNERSHIP
by Gasco, Inc.,
its General Partner

By: /s/ J.S. STEVENS III
-----------------------------------------
Name: J.S. STEVENS III
-----------------------------------------
Title: PRESIDENT
-----------------------------------------
Date: 10-21-96
-----------------------------------------

Amendment to Expense Allocation
and Participation Agreement

<PAGE> 1
EXHIBIT 10.17

EXPENSE ALLOCATION AND PARTICIPATION AGREEMENT

R E C I T A L S:

A. Brigham Oil & Gas, L.P., a Delaware limited partnership ("BOG"),
is active in the exploration and development of oil and gas properties in the
domestic United States.

B. Middle Bay Oil Company, Inc. an Alabama corporation ("Middle
Bay"), desires to participate with BOG in the drilling of wells on properties
owned or hereafter acquired, in whole or in part, by BOG, during the term
hereof and otherwise upon and subject to the provisions herein contained.

A G R E E M E N T:

FOR A GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of
which are hereby acknowledged, BOG and Middle Bay hereby act, agree and
covenant as follows:

Section 1. DEFINED TERMS. As used herein, the following terms shall have
the following meanings:

"Account Balance" means the total amount of money at any
particular time in the Escrow Account, which amount shall include any
accrued interest.

"Affiliate" means, with respect to any Person: (a) any other
Person directly or indirectly owning, controlling or holding with power to
vote 10% or more of the outstanding voting securities of such Person, (b)
any other Person 10% or more of whose outstanding voting securities are
directly or indirectly owned, controlled or held with power to vote by
such Person, and (c) any other Person directly or indirectly controlling,
controlled by or under common control with such Person.

"Agreement Term" means the period beginning on the date hereof at
7:00 a.m. CST, and ending on the earlier to occur of (i) March 31, 1997,
at 11:59 p.m. CST, or (ii) the date on which Middle Bay's 25% share of the
Drilling Costs incurred in drilling the Subject Wells and Subsequent Wells
equals or exceeds $1,500,000.00. However, in the event that it reasonably
appears to BOG that such $1,500,000.00 amount will be reached before March
31, 1997 based upon the Drilling Costs incurred to that point in time and
BOG's estimate of future Drilling Costs, BOG shall give Middle Bay written
notice that such amount will probably be reached before March 31, 1997 and
Middle Bay shall have the option to nonetheless extend the term of this
Agreement to 11:59 p.m. CST on March 31, 1997, by giving BOG written
notice of such extension no less than fifteen (15) days after Middle Bay's
receipt of BOG's notice.

"Applicable Environmental Laws" means any federal, state and/or
local laws, rules, orders or regulations, whether now existing or
hereafter enacted, modified or amended, relating to health or to the
protection of the environment, including without limitation the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended by the Superfund Amendments and Reauthorization Act of
1986, the Resource Conservation and Recovery Act of 1976, a amended by the
Used Oil Recycling Act of 1980, the Solid Waste Disposal Act Amendments of
1980, and the Hazardous and Solid Waste Amendments of 1984.

"Assigned Interests" shall have the meaning assigned to it in
Section 9 hereof.

"Assignment" means any assignment executed pursuant to Section 9
hereof by BOG in favor of Middle Bay.

"BOG Account" shall be the BOG bank account designated by BOG to
Middle Bay in writing from time to time.
<PAGE> 2
"BOG Account Balance" means the balance of the funds that
have been deposited into the BOG Account from the Escrow Account for
Middle Bay's share of BOG Drilling Costs and BOG Completion Costs which
have not yet been paid or advanced to the drilling operator, together with
any interest earned from such funds in the BOG Account, net of all bank
fees and other charges incurred with respect to the BOG Account.

"BOG Completion Costs" means, with respect to any particular
Subject Well or Subsequent Well, BOG's share of the Completion Costs
associated with such Subject Well or Subsequent Well. For purposes of the
foregoing, "BOG's share" of Completion Costs shall be determined based
upon the share of Completion Costs allocable to BOG Properties (a) without
regard to any other agreement whereunder a third party agrees to carry BOG
for all or any portion of what would otherwise be BOG's share of
Completion Costs relative to any particular Subject Well or Subsequent
Well, (b) without regard to any agreement whereunder BOG agrees to carry a
third party for a share of such third party's Completion Costs, and (c)
with regard to and taking into account any additional interest (and
attendant share of Completion Costs) in any particular Subject Well or
Subsequent Well which BOG may acquire, temporarily or permanently, due to
the election by one or more third parties not to participate in the
Completion of such Subject Well or Subsequent Well. By way of
illustration, assume that BOG owns (or is entitled to earn, under a
farmout agreement or otherwise) a 25% interest in a lease covering 100% of
the mineral fee interest in Tract A, and ABC Oil Company ("ABC") owns 25%
and CDE Oil Company ("CDE") owns the remaining 50% interest. If BOG
proposes the Completion of a Subject Well or Subsequent Well on Tract A
and all of BOG, ABC and CDE elect to participate therein, BOG's share of
the Completion Costs associated with such well would, in typical
circumstances, be 25%. If, however, ABC elects not to participate in the
Completion of the well and BOG and CDE elect to proceed to Complete the
well and each acquire a proportionate part of ABC's non-consent interest,
BOG's share of the Completion Costs would, in typical circumstances, be
33.333%. In the event ABC has the right to again participate in the well
after, for example, payout of a nonconsent penalty, the interests of BOG
and Middle Bay shall both proportionately be reduced to take into account
the after payout interest of ABC. In both of the examples set out above,
assume further that XYZ Oil Company ("XYZ") has agreed to carry BOG for
50% of what would otherwise be BOG's share of Completion Costs in order to
earn 25% of BOG's interest in the well. Under such circumstances, the BOG
Completion Costs shall be determined without regard to XYZ's agreement to
pay 50% of what would otherwise be BOG's share of the Completion Costs
associated with the well, but the 25% interest BOG is obligated to assign
to XYZ shall be taken into account in determining the interest in any
particular BOG Property subject to this Agreement. As such, in this
example in which XYZ has agreed to pay 50% of BOG's share of Completion
Costs in return for 25% of BOG's interest in the Subject Well or
Subsequent Well, as BOG's interest in the well is reduced to 18.75% in the
example in which all of the parties elected to participate and to
24.99975% in the example in which ABC elected not to participate in order
to account for XYZ's earned interest, the BOG Completion Costs associated
with such well would be reduced to BOG's reduced interest in the Subject
Well or Subsequent Well.

"BOG Drilling Costs" means, with respect to any particular Subject
Well or Subsequent Well, BOG's share of the Drilling Costs associated with
such Subject Well or Subsequent Well. For purposes of the foregoing,
"BOG's share" of Drilling Costs shall be determined based upon the share
of Drilling Costs allocable to BOG Properties (a) without regard to any
other agreement whereunder a third party agrees to carry BOG for all or
any portion of what would otherwise be BOG's share of Drilling Costs
relative to any particular Subject Well or Subsequent Well, (b) without
regard to any agreement whereunder BOG agrees to carry a third party for a
share of such third party's Drilling Costs, and (c) with regard to and
taking into account any additional interest (and attendant share of
additional Drilling Costs) in any particular Subject Well or Subsequent
Well which BOG may acquire, temporarily or permanently, due to the
election by one or more third parties not to participate in the drilling
of such Subject Well or Subsequent Well. By way of illustration, assume
that BOG owns (or is entitled to earn, under a farmout agreement or
otherwise) a 25% interest in a lease covering 100% of the mineral fee
interest in Tract A, and ABC Oil Company ("ABC") owns 25% and CDE Oil
Company ("CDE") owns the remaining 50% interest. If BOG proposes the
drilling of a well on Tract A and all of BOG, ABC and CDE elect to
participate therein, BOG's share of the Drilling Costs associated with
such well would, in typical circumstances be 25%. If, however, ABC elects
not to participate in the drilling of the well and BOG and CDE elect to
proceed to drill the well and each acquire their proportionate part of
ABC's non-consent interest, BOG's share of the Drilling Costs would, in
typical

-2-
<PAGE> 3
circumstances, be 33.333%. In the event ABC has the right to again
participate in the well after, for example, payout of a nonconsent
penalty, the interests of BOG and Middle Bay shall both proportionately be
reduced to take into account the after payout interest of ABC. In both of
the examples set out above, assume further that XYZ Oil Company ("XYZ")
has agreed to carry BOG for 50% of what would otherwise be BOG's share of
Drilling Costs in order to earn 25% of BOG's interest in the Subject Well
or Subsequent Well. Under such circumstances, the BOG Drilling Costs
shall be determined without regard to XYZ's agreement to pay 50% of what
would otherwise be BOG's share of the Drilling Costs associated with the
well, but the 25% interest BOG is obligated to assign to XYZ shall be
taken into account in determining the interest in any particular BOG
Property subject to this Agreement. As such, in this example in which XYZ
has agreed to pay 50% of BOG's share of Drilling Costs in return for 25%
of BOG's interest in the Subject Well or Subsequent Well, as BOG's
interest in the well is reduced to 18.75% in the example in which all of
the parties elected to participate and to 24.99975% in the example in
which ABC elected not to participate in order to account for XYZ's earned
interest, the BOG Drilling Costs associated with such well would be
reduced to BOG's reduced interest in the Subject Well or Subsequent Well.

"BOG Participation Agreements" means any agreements now or
hereafter existing whereunder BOG agrees with certain third parties upon
terms and conditions of joint exploration and/or development of oil and/or
gas properties located in the domestic United States, including without
limitation the existing participation agreements described in Exhibit A
hereto, as same may be amended, modified or extended from time to time.

"BOG Properties" means BOG's undivided right, title and interest
in and to any property, right or interest that gives BOG the right to
drill for and produce oil, gas and associated hydrocarbons in any of the
lands described in Exhibit B, whether now owned or hereafter acquired by
BOG during the term hereof; BOG Properties shall in no event include any
overriding royalty interest owned by or owing to BOG, whether pursuant to
a Participation Agreement or otherwise. However, in the event that prior
to the Completion of a Subject Well BOG has assigned or has agreed to
assign interests in properties, rights or interests which are related to
such Subject Well or the Drilling and Production Unit for the applicable
Subject Well, the interests in such properties, rights or interests which
BOG has assigned or agreed to assign shall not be part of the BOG
Properties for purposes of this Agreement. In addition, anything to the
contrary contained herein notwithstanding, in the event that BOG Drilling
Costs with respect to any particular Subject Well are estimated, as set
out in the initial authority for expenditure or "AFE" circulated for the
drilling of such Subject Well (which AFE may be circulated by BOG or by
some third party), to exceed $280,000.00, BOG's undivided interests in and
to the properties, rights and interests included in the Drilling and
Production Unit for such Subject Well shall be reduced in the same
percentage by which the estimated BOG Drilling Costs exceed $280,000.00,
and that reduction amount shall not be a part of the BOG Properties and
shall otherwise be excluded from this Agreement for all purposes. By way
of illustration, assume that (a) the estimated BOG Drilling Costs for any
particular Subject Well is $336,000.00 and thus exceeds the amount of
$280,000.00 by exactly 20%, (b) the Drilling and Production Unit for such
Subject Well covers 80 acres and as part of the BOG Properties BOG owns
and undivided 70% interest in an oil and gas lease (for purposes of this
example referred to as the "Lease") covering 60 net mineral acres in such
Drilling Unit and an undivided 40% interest in the minerals (for purposes
of this example referred to as the "Minerals") covering the other 20 net
mineral acres in the Drilling and Production Unit. Under this example,
20% of BOG's interest in both the Lease and the Minerals would be excluded
from the BOG Properties; as such, an undivided 56% (i.e. 80% of BOG's 70%)
interest in the Lease and an undivided 32% (i.e. 80% of BOG's 40%)
interest in the Minerals would constitute the BOG Properties for the
Drilling and Production Unit for such Subject Well. Notwithstanding any
provision hereof to the contrary, the original estimate of BOG Drilling
Costs as set forth in the initial AFE circulated relative to any Subject
Well will always, unless BOG and Middle Bay mutually agree to the
contrary, definitely be utilized for purposes of determining whether and
by how much the above-described $280,000.00 benchmark has been exceeded.

"Casing Point" means the time when the well has been drilled to
the objective depth stated in the initial notice, appropriate tests have
been made, and the drilling operator notifies all of the participating
parties of his recommendation with respect to completing or plugging and
abandoning the well.

-3-
<PAGE> 4

"Complete" or "Completion" means a single operation designed to
complete a Subject Well or Subsequent Well as a producer in one or more
zones, including without limitation the setting of production casing,
perforating, and, where necessary or appropriate, well stimulation.

"Completion Costs" means the costs and expenses associated with
any attempted Completion of a Subject Well or Subsequent Well. In
addition, in the event that Completion operations are attempted within a
well but the well is not ultimately completed as a producer, the costs
incurred to plug and abandon such well shall also constitute Completion
Costs for purposes of this Agreement.

"Consent" means any right of a third party to grant or deny its
consent to the execution of this Agreement or the consummation of all or
any part of the transactions contemplated herein, including without
limitation any consents provided for or otherwise disclosed in the
existing BOG Participation Agreements.

"Drilling Costs" means all costs and expenses related to (a) the
preparation for drilling and then the drilling and equipping of a well up
and to Casing Point, and (b) all activities associated with plugging and
abandoning a well in which Completion operations have not been attempted.
Without limitation of the generality of the foregoing, Drilling Costs
shall include all costs associated with (i) clearing and building a
location and creating or improving access to such location (e.g., by
building roads), (ii) setting surface casing, and (iii) logging and
testing the well prior to the commencement of Completion operations.

"Drilling and Production Unit" means, with respect to any
particular well, the acreage allocable, as determined by reference to the
formation initially Completed in such well, to such well under applicable
laws, rules or regulations of governmental authorities having jurisdiction
for the drilling and production of such well at a legal location and the
production from such well of its maximum allowable, such maximum allowable
to be determined by reference to the lesser of (a) the maximum permissible
allowable for such well as set by any governmental authority having
jurisdiction, and (b) such well's maximum prudent physical productive
capability, as determined by reference to the initial potential test or
initial deliverability test, as the case may be, for such well, limited in
each instance to those depths between the surface and 100 feet below the
deepest depth drilled in the relevant well; the exact configuration of any
such Drilling and Production Unit shall be designated by BOG utilizing
reasonable discretion and good faith. In the event that no governmental
authority having jurisdiction has promulgated any laws, rules or
regulations pursuant to which the Drilling and Production Unit for any
particular well can be determined as set forth in the immediately
preceding sentence, BOG shall, utilizing reasonable discretion and good
faith, designate a Drilling and Production Unit for such well. However,
in the event that after a Drilling and Production Unit is established for
a Subject Well as provided herein, the Drilling and Production Unit for a
Subject Well that has been completed as a producer is reconfigured or
otherwise altered or changed under law, rule, order or regulation of any
governmental authority having jurisdiction, commencing with the effective
date of such change, the Drilling and Production Unit for such Subject
Well shall be deemed to have been altered as required by the law, rule,
order or regulation and the Parties shall execute all conveyance
instruments necessary to cause Middle Bay to own the interests (and only
the interests) in the BOG Properties which are included within the revised
Drilling and Production Unit; provided, however, that in the event that
prior to the change in the Drilling and Production Unit a well has been
drilled on acreage (or lands pooled or otherwise combined therewith) which
was not previously included within such Drilling and Production Unit or
BOG has assigned interests in acreage which was not previously included
within such Drilling and Production Unit, BOG shall not be required to
assign such well (or any production therefrom) or interests to Middle Bay
despite the later inclusion of such well or acreage in the Drilling and
Production Unit. Similarly, in the event that prior to a change in a
Drilling and Production Unit a Subsequent Well has been drilled on acreage
which was previously included within such Drilling and Production Unit and
Middle Bay participated in the drilling of such Subsequent Well as
provided in Section 9(b) below, Middle Bay shall not be required to assign
its interest in such Subsequent Well (or any production therefrom) to BOG
despite the later exclusion of such Subsequent Well or acreage from the
Drilling and Production Unit. The Drilling and Production Unit for any
particular Subject Well shall in no event include any acreage and/or
depths otherwise allocable to the drilling and spacing, proration or
pooled unit reasonably and in good faith designated by BOG for any other
well, the actual drilling of which was

-4-
<PAGE> 5
commenced prior to the date hereof, in which BOG owns an interest and
which does not constitute a Subject Well.

"Escrow Account" shall mean the escrow account to be established
at the Bank of Oklahoma, Tulsa, Oklahoma, and governed by the escrow
agreement which is attached hereto as Exhibit D.

"Initial Deposit" shall have the meaning assigned to it in Section
8 hereof.

"Initial Period" shall have the meaning assigned to it in Section
8 hereof.

"Person" means, an individual, corporation, partnership, limited
liability company, association, joint stock company, pension fund, trust
or trustee thereof, estate or executor thereof, unincorporated
organization or joint venture, court or governmental unit or any agency or
subdivision thereof, or any other legally recognizable entity.

"Preferential Rights" means a preferential right or option in
favor of a third party to acquire all or a portion of a BOG Property, or
to otherwise participate with BOG in the exploration, or development
thereof.

"Routine Governmental Approvals" means the right of any
governmental entity to consent to or approve the transfer of any interest
in a BOG Property.

"Seismic Data" means all data secured by or on behalf of BOG in
the conduct of 3-D seismic operations on, across or through the BOG
Properties, including any tapes, reproducibles and interpretations.
Seismic Data shall not include any data which BOG, in its sole and
absolute discretion, deems to be subject to a confidentiality restriction
imposed by or for the benefit of a third party.

"Shortfall Deposit" means any additional funds required to be
deposited by Middle Bay with BOG pursuant to subsections 8(b)(iii) and
8(c)(iii) hereof.

"Subject Well" means each well on a BOG Property, or on lands
pooled or unitized therewith, for which drilling operations are actually
commenced after the commencement of the Agreement Term and for which
Middle Bay's share of the BOG Drilling Costs for such well have been
forwarded to the drilling operator for such well prior to the expiration
of the Agreement Term in accordance with the terms of Section 8 below,
regardless of when the well was proposed; the term Subject Well shall not
include (a) any well in the drilling of which BOG elects not to
participate, or (b) any recompletion, deepening, side track, plug back,
rework or other operation in a wellbore already in existence at the time
the subject new operation is proposed. For purposes of this definition
drilling operations for a well shall not be deemed to have been "actually
commenced" unless and until a drill bit is turning in the ground at the
well's surface location utilizing a drilling rig that is capable of
drilling the well to its proposed total depth. The Parties recognize and
agree that any well which is drilled within the Drilling and Production
Unit (or on lands pooled or unitized therewith) of a well for which
drilling operations were actually commenced prior to the Agreement Term,
shall not be a Subject Well or Subsequent Well for purposes of this
Agreement and such a well shall not be subject to this Agreement, to the
effect that Middle Bay shall not be obligated to pay any share of the
Drilling Costs associated with any such well or wells and shall further
have no right to receive assignment of any interest therein (or in any
Drilling and Production Unit otherwise allocable thereto). In addition,
in the event that BOG and Middle Bay mutually so agree with respect to any
particular well or wells proposed to be drilled during the Agreement Term,
such well or wells shall not become Subject Wells and shall otherwise not
be subject to this Agreement, to the effect that Middle Bay shall not be
obligated to pay any share of the Drilling Costs associated with any such
well or wells and shall further have no right to receive assignment of any
interest therein (or in any Drilling and Production Unit otherwise
allocable thereto).

"Subsequent Deposit" shall have the meaning assigned to it in
Section 8 hereof.

-5-
<PAGE> 6
"Subsequent Period" means each of (a) the period
beginning on July 1, 1996 and ending on September 30, 1996, (b) the period
beginning on October 1, 1996 and ending on December 31, 1996, and (c) the
period beginning on January 1, 1997 and ending on March 31, 1997.

"Subsequent Well" shall have the meaning assigned to it in
subsection 9(b) hereof.

"Termination Amount" means the amount determined utilizing the
following formula:

EW x ADC x AWI x 12.5% x EW - AW
-------
EW

where EW is the number of Subject Wells BOG estimates will be drilled
during the Agreement Term, ADC is the average of BOG's estimate of all
Drilling Costs for EW, calculated based on 8/8ths of such Drilling Costs,
AWI is the average working interest BOG estimates it will have in the EWs,
and AW is the actual number of Subject Wells drilled hereunder during the
Agreement Term and prior to termination of this Agreement pursuant to
Section 10 hereof. For purposes hereof, the parties stipulate that EW is,
based on BOG's estimate, 87 wells, AWI is, based on BOG's estimate, 25%
and ADC is, based on BOG's estimate, $264,000.

Section 2. REPRESENTATIONS OF BOG. BOG represents to Middle Bay that:

(a) BOG is a limited partnership, duly formed and legally
existing under the laws of the State of Delaware. BOG has full power to
enter into and perform its obligations under this Agreement and has taken
all appropriate action to authorize entering into this Agreement and
performance of its obligations hereunder. Other than requirements (if
any) that there be obtained Consents or waivers of Preferential Rights,
and except for Routine Governmental Approvals which are customarily
obtained post-closing and which BOG has no reason to believe cannot be
obtained, neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, nor the compliance
with the terms hereof, will result in any material default under any
material agreement or instrument to which BOG is a party or by which the
BOG Properties are bound, or violate any order, writ, injunction, decree,
statute, rule or regulation applicable to BOG or to the BOG Properties.
This Agreement constitutes the legal, valid and binding obligation of BOG,
enforceable in accordance with its terms, except as limited by bankruptcy
or other laws applicable generally to creditor's rights and as limited by
general equitable principles.

(b) There are no suits, actions, claims, investigations,
inquiries, proceedings or demands pending (or, to the best of BOG's
knowledge, threatened) which affect the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.

THE EXPRESS REPRESENTATIONS OF BOG CONTAINED IN THIS SECTION OR IN ANY
ASSIGNMENT EXECUTED PURSUANT HERETO ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER
REPRESENTATIONS AND WARRANTIES, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, AND
BOG EXPRESSLY DISCLAIMS ANY AND ALL SUCH OTHER REPRESENTATIONS AND WARRANTIES.
WITHOUT LIMITATION OF THE FOREGOING, UNDIVIDED INTERESTS EARNED BY MIDDLE BAY
HEREUNDER IN THE BOG PROPERTIES SHALL BE CONVEYED WITHOUT ANY WARRANTY OR
REPRESENTATION, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, RELATING TO
THE CONDITION, QUANTITY, QUALITY, FITNESS FOR A PARTICULAR PURPOSE, CONFORMITY
TO THE MODELS OR SAMPLES OF MATERIALS OR MERCHANTABILITY OF ANY EQUIPMENT OR
ITS FITNESS FOR ANY PURPOSE AND MIDDLE BAY SHALL ACCEPT ALL OF THE SAME IN
THEIR "AS IS, WHERE IS" CONDITION. BOG MAKES NO WARRANTY OR REPRESENTATION,
EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, AS TO THE ACCURACY OR COMPLETENESS OF
ANY DATA, INTERPRETATIONS, REPORTS, RECORDS, PROJECTIONS, INFORMATION OR
MATERIALS NOW, HERETOFORE OR HEREAFTER FURNISHED OR MADE AVAILABLE TO MIDDLE
BAY IN CONNECTION WITH THIS AGREEMENT INCLUDING, WITHOUT LIMITATION, RELATIVE
TO SEISMIC OR GEOLOGICAL MATTERS, PRICING ASSUMPTIONS, OR QUALITY OR QUANTITY
OF HYDROCARBON RESERVES (IF ANY) ATTRIBUTABLE TO THE BOG PROPERTIES OR THE
ABILITY

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<PAGE> 7
OR POTENTIAL OF THE BOG PROPERTIES TO PRODUCE HYDROCARBONS OR ANY OTHER MATTERS
CONTAINED IN THE PROPRIETARY DATA OR ANY OTHER MATERIALS FURNISHED OR MADE
AVAILABLE TO MIDDLE BAY BY BOG OR BY BOG'S AGENTS OR REPRESENTATIVES. ANY AND
ALL SUCH DATA, RECORDS, REPORTS, PROJECTIONS, INFORMATION AND OTHER MATERIALS
(WRITTEN OR ORAL) FURNISHED BY BOG OR OTHERWISE MADE AVAILABLE OR DISCLOSED TO
MIDDLE BAY ARE PROVIDED MIDDLE BAY AS A CONVENIENCE AND SHALL NOT CREATE OR GIVE
RISE TO ANY LIABILITY OF OR AGAINST BOG AND ANY RELIANCE ON OR USE OF THE SAME
SHALL BE AT MIDDLE BAY'S SOLE RISK TO THE MAXIMUM EXTENT PERMITTED BY LAW.

Section 3. REPRESENTATIONS OF MIDDLE BAY. Middle Bay represents to BOG
that:

(a) Middle Bay is a corporation duly organized and legally
existing under the laws of the State of Alabama. Middle Bay has full
power to enter into and perform its obligations under this Agreement and
has taken all appropriate action to authorize entering into this Agreement
and performance of its obligations hereunder. Neither the execution and
delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, nor the compliance with the terms hereof, will result
in any default under any material agreement or instrument to which Middle
Bay is a party or by which Middle Bay is bound, or violate any order,
writ, injunction, decree, statute, rule or regulation applicable to Middle
Bay. This Agreement constitutes the legal, valid and binding obligation
of Middle Bay, enforceable in accordance with its terms, except as limited
by bankruptcy or other laws applicable generally to creditor's rights and
as limited by general equitable principles.

(b) There are no suits, actions, claims, investigations,
inquiries, proceedings or demands pending (or, to the best of Middle Bay's
knowledge, threatened) which affect the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.

(c) Middle Bay is a knowledgeable purchaser, owner and
operator of oil and gas properties, has the ability to evaluate (and in
fact has evaluated or will evaluate, as the case may be) the BOG
Properties for acquisition, and is acquiring the BOG Properties and its
rights and interests hereunder for its own account and not with the intent
to make a distribution in violation of the Securities Act of 1933 as
amended (and the rules and regulations pertaining thereto) or in violation
of any other applicable securities laws, rules, or regulations.

Section 4. PREFERENTIAL RIGHTS AND CONSENTS.

BOG will utilize reasonable efforts, consistent with industry practices in
transactions of this type, to identify any Preferential Rights or Consents
which would be applicable to the BOG Properties and the transactions
contemplated hereby. In attempting to identify such Preferential Rights and
Consents, BOG is in no event obligated to go beyond its own records. BOG shall
have no obligation other than to so attempt to identify such Preferential
Rights or Consents and to give the notices required by such identified
Preferential Rights or Consents prior to the drilling of a Subject Well or
Subsequent Well on the applicable BOG Properties. To the extent a Preferential
Right applicable to any BOG Property (or portion thereof) is properly exercised
prior to the execution of an Assignment covering such BOG Property in favor of
Middle Bay, any well located or proposed to be located on the lands covered by
such BOG Property shall not be considered a Subject Well for purposes hereof,
and Middle Bay shall have no obligation to pay or bear any BOG Drilling Costs
associated therewith; any share of BOG Drilling Costs paid by Middle Bay
relating to such well prior to the exercise of the subject Preferential Right
shall be reimbursed by BOG to Middle Bay. To the extent any Preferential Right
applicable to any BOG Property (or portion thereof) is identified after the
date of an Assignment to Middle Bay covering such BOG Property, and is further
validly and properly exercised by a third party or third parties after such
date, Middle Bay shall convey the specific BOG Property affected by such
Preferential Right to the exercising third party or third parties, and Middle
Bay shall be entitled, as its sole remedy against BOG, to any consideration
paid by such party or parties on account of the post- Assignment exercise of
any Preferential Right affecting the BOG Property. BOG and Middle Bay hereby
recognize that any Preferential Right shall apply only to the specific property
described in the instrument creating same, and shall in no event be construed
to apply to all, or any group of, the BOG Properties, other than the specific
property described in the instrument creating the Preferential Right. BOG
shall use reasonable commercial efforts to secure

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<PAGE> 8
any Consent of which it becomes aware (whether such Consent was identified
before or after an Assignment was made covering the BOG Property burdened by
such Consent), and to the extent BOG so utilizes reasonable commercial efforts,
whether successful or not, Middle Bay shall have no legal redress against BOG
relating to any Consent (or the failure to obtain same). Prior to the drilling
of each Subject Well, at Middle Bay's request, Middle Bay will be given
reasonable access, in BOG's offices, to BOG's copies of the operating
agreements and BOG Participation Agreements affecting the drilling of such
Subject Well.

Section 5. MAINTENANCE OF UNIFORM INTEREST PROVISIONS.

It is hereby recognized that some of the BOG Properties may now be, or
hereafter become, subject to agreements (the "MUI Agreements") containing
maintenance of uniform interest provisions or similar restrictions against
assigning an interest in part, but less than all, of the contract area covered
by such agreement. In this connection, BOG undertakes to use reasonable
commercial efforts to secure waivers from the other parties to each MUI
Agreement that will allow Assignments to be made hereunder. In order to secure
these waivers, BOG may agree that any separate measurement and/or storage
facilities necessitated by an assignment by BOG to Middle Bay of an interest in
part, but less than all, of the contract area covered by the applicable MUI
Agreement shall be arranged and paid for in equal shares by BOG (50%) and
Middle Bay (50%). BOG and Middle Bay further agree that any other costs,
liabilities, damages or obligations, of whatever kind or character, arising
out of or relative to any maintenance of uniform interest or similar provision
contained in an MUI Agreement shall be borne and paid for in equal shares by
BOG (50%) and Middle Bay (50%).

Section 6. PARTICIPATION IN BOG DRILLING COSTS BY MIDDLE BAY.

Middle Bay shall have the obligation to fund 25% of the BOG Drilling Costs
associated with each Subject Well. The election whether or not to participate
in the drilling of any particular well, and thus whether such well becomes a
Subject Well hereunder, will be exercised in the sole and absolute discretion
of BOG; upon an election by BOG to participate in the drilling of any
particular Subject Well, Middle Bay's obligation to pay 25% of the BOG Drilling
Costs associated with such Subject Well shall become absolute. The Parties
recognize and agree that anything to the contrary contained herein
notwithstanding, in the event that Middle Bay's share of BOG Drilling Costs
have been forwarded to the drilling operator for a Subject Well prior to the
expiration of the Agreement Term, Middle Bay's responsibility to fund 25% of
the BOG Drilling Costs associated with such Subject Well shall continue despite
the termination of the Agreement Term.

Section 7. COMPLETION ELECTIONS.

Middle Bay shall have the obligation to fund 12.5% of the BOG Completion
Costs associated with each Subject Well. In the event there is a separate
Completion point election relative to any particular Subject Well, BOG shall,
in its sole and absolute discretion, make such election for itself and for
Middle Bay. Any election by BOG to Complete or not to Complete any Subject
Well shall for all purposes be binding upon Middle Bay, the same as if Middle
Bay had also made the same election. Middle Bay shall have the obligation to
fund a 12.5% share of all BOG Completion Costs associated with any Subject
Well. The Parties recognize and agree that anything to the contrary contained
herein notwithstanding, in the event that Middle Bay's share of BOG Drilling
Costs have been forwarded to the drilling operator for a Subject Well prior to
the expiration of the Agreement Term, Middle Bay's responsibility to fund 25%
of the BOG Drilling Costs and 12.5% of the BOG Completion Costs associated with
such Subject Well shall continue despite the termination of the Agreement Term.

Section 8. FUNDING AND PAYMENT OBLIGATIONS

(a) April Funding.

(i) On or prior to the date hereof, BOG has provided to
Middle Bay an estimate, determined in BOG's reasonable discretion,
of all BOG Drilling Costs related to Subject Wells and all BOG
Completion Costs relating to Subject Wells for which costs are
estimated to be incurred or advanced during the calendar month of
April, 1996.

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<PAGE> 9

(ii) Contemporaneously with the execution of this
Agreement, Middle Bay shall wire transfer to BOG's Account the sum
of $249,791.00 (the "April Deposit"), being Middle Bay's 25% share
of the estimated BOG Drilling Costs related to Subject Wells and
Middle Bay's 12.5% share of BOG Completion Costs related to
Subject Wells which costs are expected to be incurred or advanced
during the calendar month of April, 1996, in accordance with the
estimate provided in accordance with (i) above. BOG shall then
pay when due, out of and to the extent of the April Deposit, the
share of BOG Drilling Costs relating to Subject Wells and BOG
Completion Costs relating to Subject Wells actually incurred and
charged to the account of Middle Bay. The balance of the April
Deposit which has not been incurred and paid for Middle Bay's
share of BOG Drilling Costs or BOG Completion Costs will be
reflected on the books of BOG as a payable to Middle Bay until
such time as it is applied against Middle Bay's share of the BOG
Drilling Costs and BOG Completion Costs relating to Subject Wells.

(b) The Initial Period.

(i) On or prior to the date hereof, BOG has provided
to Middle Bay an estimate, determined in BOG's reasonable
discretion, of all BOG Drilling Costs relating to Subject Wells
and all BOG Completion Costs relating to Subject Wells estimated
to be incurred or advanced for the period starting on May 1, 1996
and ending on June 30, 1996 (the "Initial Period").

(ii) Contemporaneously with the execution of this
Agreement, Middle Bay shall deposit into the Escrow Account the
sum of $233,975.00 (the "Initial Deposit"), representing the sum
of Middle Bay's 25% share of the estimated BOG Drilling Costs
relating to Subject Wells for the Initial Period (the "Drilling
Cost Portion") and Middle Bay's 12.5% share of BOG Completion
Costs relating to Subject Wells for the Initial Period (the
"Completion Cost Portion") estimated to be incurred or advanced
during the Initial Period. Such deposit shall be made in
immediately available funds.

(iii) It is hereby recognized that the Initial Deposit
was calculated based on estimated BOG Drilling Costs relating to
Subject Wells and estimated BOG Completion Costs relating to
Subject Wells for the Initial Period. BOG shall have the right
from time to time during the Initial Period to revise its estimate
of BOG Drilling Costs relating to Subject Wells and/or BOG
Completion Costs relating to Subject Wells upward. To the extent
that the Deposit Balance is (or is reasonably estimated by BOG to
be) less at any particular time than the sum of Middle Bay's 25%
share of the revised estimate of BOG Drilling Costs relating to
Subject Wells for the Initial Period, and Middle Bay's 12.5% share
of the revised estimate of BOG Completion Costs relating to
Subject Wells for the Initial Period, Middle Bay shall deposit
into the Escrow Account funds representing 25% of the portion of
the estimated shortfall attributable to BOG Drilling Costs
relating to Subject Wells and 12.5% of the portion of the
estimated shortfall attributable to BOG Completion Costs relating
to Subject Wells (which funds shall constitute a Shortfall
Deposit); such Shortfall Deposit shall be made by Middle Bay, in
immediately available funds, into the Escrow Account, within 15
days after receipt by Middle Bay of a written request for the
subject Shortfall Deposit.

(iv) On or before the 25th day of each calendar month
within the Initial Period BOG shall provide Middle Bay with an
estimate, determined in BOG's reasonable discretion, of all BOG
Drilling Costs relating to Subject Wells and all BOG Completion
Costs relating to Subject Wells estimated to be incurred or
advanced during the next succeeding calendar month. The amount of
each such estimate shall, however, be determined giving due credit
to any BOG Account Balance from the previous month that is
expected to remain unused and that further is not earmarked by BOG
for payment of Middle Bay's share of BOG Drilling Costs relating
to Subject Wells and/or BOG Completion Costs relating to Subject
Wells for such previous month. On or before the first day of the
next succeeding calendar month the Bank of Oklahoma shall, upon
receipt from BOG of a copy of the same written estimate described
above, cause Middle Bay's 25% share of the BOG Drilling Costs
relating to Subject Wells and Middle Bay's 12.5% share of the BOG
Completion Costs relating to Subject Wells estimated by BOG to be
incurred or advanced during the next calendar month, to be
dispersed from the Escrow Account into the BOG Account by wire
transfer, in immediately available funds. BOG shall utilize such
funds to

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<PAGE> 10
pay, when due, out of and to the extent of such deposit, Middle
Bay's 25% share of the estimated BOG Drilling Costs relating to
Subject Wells and Middle Bay's 12.5% share of the estimated BOG
Completion Costs relating to Subject Wells which are incurred
during such next calendar month. The balance of each monthly
deposit which has not been incurred and paid for Middle Bay's
share of BOG Drilling Costs or BOG Completion Costs will be
reflected on the books of BOG as a payable to Middle Bay until
such time as it is applied against Middle Bay's share of the BOG
Drilling Costs and BOG Completion Costs relating to Subject Wells.

(i) Within forty-five days of the first day of each
Subsequent Period, BOG shall provide to Middle Bay a written
estimate, determined in BOG's reasonable discretion, of the BOG
Drilling Costs relating to Subject Wells and BOG Completion Costs
relating to Subject Wells for such Subsequent Period.

(ii) On or before 30 days before the first day of each
Subsequent Period, Middle Bay shall deposit into the Escrow
Account an amount (the "Subsequent Deposit") representing the sum
of Middle Bay's 25% share of the estimated BOG Drilling Costs
relating to Subject Wells for such Subsequent Period and Middle
Bay's 12.5% share of the estimated BOG Completion Costs relating
to Subject Wells expected to be incurred or advanced during such
Subsequent Period. The amount of each Subsequent Deposit shall,
however, be determined giving due credit to any Account Balance
that is expected to remain unused from a previous period (i.e.,
from the Initial Period or a prior Subsequent Period, as the case
may be) and that further is not earmarked by BOG for payment of
Middle Bay's share of BOG Drilling Costs relating to Subject Wells
and/or BOG Completion Costs relating to Subject Wells for such
previous period. Such deposit shall be made, in immediately
available funds, into the Escrow Account.

(iii) It is hereby recognized that each Subsequent
Deposit shall be calculated based on estimated BOG Drilling Costs
relating to Subject Wells and BOG Completion Costs relating to
Subject Wells for the applicable Subsequent Period. BOG shall
have the right from time to time during each Subsequent Period to
revise its estimates of BOG Drilling Costs relating to Subject
Wells and/or BOG Completion Costs relating to Subject Wells for
such Subsequent Period upward. To the extent that the Account
Balance is (or is reasonably estimated by BOG to be) less at any
particular time than the sum of Middle Bay's 25% share of the
revised estimate of BOG Drilling Costs relating to Subject Wells
for the applicable Subsequent Period and Middle Bay's 12.5% share
of the revised estimate of BOG Completion Costs relating to
Subject Wells for such Subsequent Period, Middle Bay shall deposit
into the Escrow Account funds (which shall constitute a Shortfall
Deposit) representing 25% of the portion of the estimated
shortfall attributable to BOG Drilling Costs relating to Subject
Wells and 12.5% of the portion of the estimated shortfall
attributable to BOG Completion Costs relating to Subject Wells;
such deposit shall be made by Middle Bay, in immediately available
funds, within 15 days after receipt by Middle Bay of a written
request for the Shortfall Deposit.

(iv) On or before the 25th day of each calendar month
occurring within the applicable Subsequent Period, BOG shall
provide Middle Bay with an estimate, determined in BOG's
reasonable discretion, of all BOG Drilling Costs relating to
Subject Wells and all BOG Completion Costs relating to Subject
Wells estimated to be incurred or advanced during the next
succeeding calendar month. The amount of each such estimate
shall, however, be determined giving due credit to any BOG Account
Balance from the previous month that is expected to remain unused
and that further is not earmarked by BOG for payment of Middle
Bay's share of BOG Drilling Costs relating to Subject Wells and/or
BOG Completion Costs relating to Subject Wells for such previous
month. On or before the first day of the next succeeding
calendar month the Bank of Oklahoma shall, upon receipt from BOG
of a copy of the same written estimate described above, cause
Middle Bay's 25% share of the BOG Drilling Costs relating to
Subject Wells and Middle Bay's 12.5% share of BOG Completion Costs
relating to Subject Wells estimated by BOG to be incurred or
advanced during the next calendar month, to be dispersed

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from the Escrow Account into the BOG Account by wire transfer, in
immediately available funds. BOG shall utilize such funds to pay,
when due, out of and to the extent of such deposit, Middle Bay's
25% share of the estimated BOG Drilling Costs relating to Subject
Wells and Middle Bay's 12.5% share of BOG Completion Costs
relating to Subject Wells which are incurred during the such next
calendar month. The balance of each monthly deposit which has not
been incurred and paid for Middle Bay's share of BOG Drilling
Costs or BOG Completion Costs will be reflected on the books of
BOG as a payable to Middle Bay until such time as it is applied
against Middle Bay's share of the BOG Drilling Costs and BOG
Completion Costs relating to Subject Wells.

(d) Reporting. On or before a date that is Forty-five (45)
days after expiration of the previous period (i.e., the Initial Period or
a prior Subsequent Period, as the case may be), BOG shall provide to
Middle Bay a statement reflecting, on a well-by-well basis, application of
the funds attributable to Middle Bay's share of BOG Drilling Costs
relating to Subject Wells and BOG Completion Costs relating to Subject
Wells for the previous period; such statement shall be based on actual
numbers, where available, and on estimates, where actuals are not
available.

Section 9. ASSIGNMENTS AND SUBSEQUENT WELLS.

(a) Assignments. BOG shall execute an Assignment in favor of
Middle Bay covering each Subject Well that is Completed as a producer of
oil, gas and/or associated hydrocarbons; any such Assignment shall be made
on the later to occur of (i) thirty business days after the end of the
calendar quarter during which the Subject Well was Completed, and (ii)
thirty business days after BOG secures assignment from a third party of
all or any portion of the interest in the Subject Well it is obligated to
assign to Middle Bay hereunder. Under each Assignment, BOG shall assign
to Middle Bay an undivided 12.5% interest in and to the BOG Properties
related to (A) the wellbore of any particular Subject Well that is
Completed as a producer of oil, gas and/or associated hydrocarbons, and in
and to the right to produce oil, gas and/or associated hydrocarbons
therefrom, and (B) subject to the limitations and restrictions set forth
in subsection 9(b), below, the Drilling and Production Unit allocable to
such Subject Well. Each Assignment shall be made effective on or before
the date of first production from the Subject Well under instrument in
substantially the form attached hereto as Exhibit C. Notwithstanding any
provision hereof to the contrary, BOG shall not be obligated to execute
any Assignment to Middle Bay hereunder upon the occurrence and during the
continuance of a material breach by Middle Bay of any representation,
warranty, covenant or other agreement herein contained. The interest
assigned to Middle Bay under any Assignment (the "Assigned Interests")
shall be burdened by an overriding royalty interest in favor of BOG (the
"BOG ORRI") in the same proportions as the interests of the participants
under the BOG Participation Agreement(s) relating to such Assigned
Interests are burdened by an overriding royalty interest created or
reserved in favor of BOG pursuant to the applicable BOG Participation
Agreement(s). The BOG ORRI shall be calculated in the same manner, and
shall bear the same costs, expenses and taxes, as the overriding royalty
interest of BOG burdening the interests of the other participants under
the BOG Participation Agreements; provided, however, that in the event
that the BOG ORRI would reduce Middle Bay's net revenue interest in any of
the BOG Properties included within the Drilling and Production Unit of a
Subject Well below 75%, proportionately reduced to Middle Bay's interest
in the BOG Properties, with respect to those BOG Properties the amount of
the BOG ORRI shall be reduced to an amount that is equal to the positive
difference, if any, between 25% and the total of all existing royalty and
overriding royally interests burdening such BOG Properties. Any Assigned
Interests shall further bear their proportionate share of any (i) rights
of reversion or conversion in favor of third parties that do or may result
in the reduction of BOG's interest in the Assigned Interests or the
alteration of such interest (e.g. a back-in right under a farmout), and
(ii) royalties, overriding royalties, production payments and any other
burdens against BOG's interest in, or share of production from, the
Assigned Interests, to the extent same are in existence or owing under
documentation in existence as of the date the Assignment is made.

(b) Subsequent Wells. Any well drilled or commenced to be
drilled, whether during or at any time after expiration of the Agreement
Term, on acreage and to depths included within the Drilling and Production
Unit (or on lands pooled or unitized therewith) for a Subject Well shall
be considered a "Subsequent Well" for all purposes hereof.
Notwithstanding any provision hereof to the contrary:

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<PAGE> 12

(i) In the event that both Middle Bay and BOG elect to
participate under the applicable Participation Agreement, joint
operating agreement or similar agreement governing joint
operations on any Drilling and Production Unit in the drilling of
any particular Subsequent Well, Middle Bay shall have the
obligation to fund the sum of (A) 12.5% of BOG's share of all
Drilling Costs associated with such Subsequent Well (the "BOG
Carry Amount") and (B) Middle Bay's own share of the Drilling
Costs associated with such Subsequent Well. Upon an election by
both Middle Bay and BOG to participate in the drilling of any
particular Subsequent Well, Middle Bay's obligation to pay all BOG
Carry Amounts associated with such Subsequent Well shall become
absolute. Middle Bay shall pay over to BOG all BOG Carry Amounts
if and when incurred by BOG; provided that Middle Bay shall have
15 business days after receipt from BOG of an invoice for any
particular BOG Carry Amounts to submit payment for same, in
immediately available funds, to BOG.

(ii) In the event that Middle Bay fails to timely pay
any BOG Carry Amount within 15 days of Middle Bay's receipt of
written notice of such default from BOG, in addition to, and
without limitation of any remedies that may be available to BOG at
law or in equity, at BOG's option Middle Bay shall automatically
and in perpetuity forfeit to BOG all of Middle Bay's right, title
and interest, whether legal or equitable, vested or contingent, in
and to the entire wellbore of the Subsequent Well to which such
BOG Carry Amount relates, together with any right to oil, gas or
other substances that may be produced therefrom and any proceeds
related thereto, subject only to any superior rights of third
parties under any Participation Agreement, joint operating
agreement or other agreement governing joint operations on the
relevant Drilling and Production Unit to which both Middle Bay and
BOG are parties or are otherwise bound.

(iii) Notwithstanding any provision hereof to the
contrary, in the event that any particular Subsequent Well has
allocated to it a drilling and spacing unit or a proration or
pooled unit, as the case may be, that includes acreage outside the
aerial confines of the Drilling and Production Unit related to
such Subsequent Well (the "Outside Lands"), Middle Bay shall in no
event be entitled to any right, title or interest in (A) any such
Outside Lands, or (B) any production or proceeds allocable to such
Outside Lands under applicable law, rule, order or regulation or
otherwise under any voluntary pooling, unitization or similar
agreement to which BOG is a party or is otherwise bound; instead,
Middle Bay shall be limited to its share of production (or the
proceeds thereof) as derived from its right, title and interest
only in the pooled unit, drilling and spacing unit or proration
unit, as the case may be, that is made up of lands from the
Drilling and Production Unit. Further, BOG's share of Drilling
Costs utilized in the computation of BOG Carry Amounts shall be
determined only by reference to the proportionate share of any
pooled unit, drilling and spacing unit or proration unit, as the
case may be, that is made up of lands included in the Drilling and
Production Unit. By way of example, assume that a particular
Drilling and Production Unit is comprised of Tract A, containing
320 acres, and Tract B, containing 320 acres; Middle Bay owns a
12.5% share of the oil, gas and other mineral leasehold interest
in Tracts A and B and BOG owns the remaining 87.5%. Further
assume that a Subsequent Well is drilled on Tract A, and both
Middle Bay and BOG elect to participate in the drilling of such
well. Tract A, constituting Drilling and Production Unit lands,
is then pooled or otherwise combined with Tract C, constituting
Outside Lands; BOG owns a 100% interest in the oil, gas and/other
mineral leasehold interest in Tract C. BOG's share of the
Drilling Costs for the Subsequent Well is $1,000,000. Under these
facts, Middle Bay would be entitled to 6.25% (i.e. 12.5% x 50%) of
the production and allocable proceeds from the subject Subsequent
Well, prior to deduction of royalties and other burdens, assuming
production is allocable as between Tracts A and B equally (i.e.,
on a surface acreage basis); if production is allocable as between
Tracts A and C other than on a surface acreage basis (e.g., based
on acre-feet), then Middle Bay's share of production from the
Subsequent Well, again derived only from its 12.5% interest in
Tract A, will be adjusted accordingly. Middle Bay's allocable
share of Drilling Costs under these facts would be $125,000 (i.e.,
the sum of (a) 12.5% x 50% x $1,000,000, and (b) the BOG Carry
Amount, which is 12.5% x 50% x $1,000,000), assuming that Drilling
Costs are allocable as between Tracts A and B on a surface acreage
basis; if Drilling Costs are allocable other than on a surface
acreage basis, Middle Bay's allocable share thereof, again
delivered from both its 12.5% interest in Tract A and from its
obligation to pay and bear the BOG Carry Amount, shall be adjusted
accordingly.

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(iv) The provisions of this subsection 9(b) shall be
binding upon and shall enure to the benefit of BOG and Middle Bay,
and their respective successors and assigns. Any assignment or
other transfer by Middle Bay of any right, title or interest in
any Drilling and Production Unit established pursuant to this
Agreement shall be made expressly subject to the terms of this
Section 9(b), and the transferee shall expressly agree to assume
and be bound by the terms of this subsection 9(b); any attempted
assignment or other transfer by Middle Bay that is not in
compliance with the foregoing shall be void.

Section 10. CONDITIONS PRECEDENT AND TERMINATION RIGHTS.

The obligation of BOG under this Agreement to allow Middle Bay to
participate in the drilling of any particular Subject Well, and to receive
assignment of an undivided 12.5% of BOG's interest therein, is subject to the
fulfillment of each of the following conditions, unless any one or more of same
are waived, in whole or in part, by BOG:

a. Each and every representation of Middle Bay under this
Agreement shall be true and accurate in all material respects as of the
date when made and shall be deemed to have been made again at and as of
the time of the proposed drilling of each Subject Well, and shall at and
as of the proposed drilling of each Subject Well be true and accurate in
all material respects except as to changes specifically contemplated by
this Agreement or consented to by BOG.

b. Middle Bay shall have performed and complied in all
material respects with (or compliance therewith shall have been waived by
BOG) each and every covenant, agreement and condition required by this
Agreement to be performed or complied with by Middle Bay, including
without limitation Middle Bay shall have timely performed its funding and
payment obligations under Section 8 hereof.

c. No suit, action or other proceedings shall, on the date
of the proposed drilling of each Subject Well, be pending or threatened
against Middle Bay or BOG before any court or governmental agency seeking
to restrain, prohibit, or obtain damages or other relief in connection
with the consummation of the transactions contemplated by this Agreement,
except to the extent that such suit, action or other proceedings arise, in
whole or in part out of any action or inaction of BOG in breach of or
otherwise in derogation of this Agreement.

Notwithstanding any provision hereof to the contrary, in the event Middle Bay
fails at any time or from time to time, within 15 days after receipt of an
invoice or other written demand by BOG, to make any payment owing to BOG
hereunder or to otherwise satisfy any funding obligation hereunder, BOG shall
have the right, exercisable in its sole and absolute discretion, to terminate
this Agreement, in which case BOG shall be authorized to receive from Middle
Bay the Termination Amount. Middle Bay shall wire transfer to an account or
accounts designated by BOG the Termination Amount within fifteen business days
after receipt by Middle Bay of BOG's written notice that this Agreement has
been terminated pursuant to the preceding sentence of this Section 10. MIDDLE
BAY AND BOG ACKNOWLEDGE THAT THE EXTENT OF DAMAGES TO BOG OCCASIONED BY MIDDLE
BAY'S FAILURE TO PROMPTLY PERFORM ITS PAYMENT OR FUNDING OBLIGATIONS HEREUNDER
WOULD BE IMPOSSIBLE OR EXTREMELY DIFFICULT TO ASCERTAIN AND THAT THE AMOUNT OF
THE TERMINATION AMOUNT IS A FAIR AND REASONABLE ESTIMATE OF SUCH DAMAGES UNDER
THE CIRCUMSTANCES AND DOES NOT CONSTITUTE A PENALTY. Middle Bay hereby
expressly recognizes that BOG has a legal right, but not the obligation, to
set-off all or any portion of the Account Balance against Middle Bay's
obligation to pay the Termination Amount.

Section 11. ASSUMPTION AND REIMBURSEMENT.

Any assignment made by BOG to Middle Bay hereunder shall be made expressly
subject to any applicable Participation Agreement(s), and any joint operating
agreements related thereto. Middle Bay agrees to be bound by the terms of any
such Participation Agreement(s) and any related joint operating agreements, and
hereby agrees, effective as of the effective time of the subject Assignment, to
expressly assume a 12.5% share of BOG's obligations under the applicable
Participation Agreements and joint operating agreement(s), insofar as they
pertain to the

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<PAGE> 14
particular Assigned Interests and any related facilities. Nothing contained in
this Section 11 or elsewhere in this Agreement or any Assignment executed
pursuant hereto shall be construed to afford Middle Bay any right (and Middle
Bay shall have no right) to participate in production from or proceeds
attributable to any well, other than a Subject Well or a Subsequent Well,
whether drilled under the terms of any particular Participation Agreement
and/or joint operating agreement or otherwise. In addition, nothing contained
in this Section 11 or elsewhere in this Agreement or any Assignment executed
pursuant hereto shall be construed to afford Middle Bay any right (and Middle
Bay shall have no right) to participate, as the result of the operation of an
area of mutual interest or similar provision, in any interests acquired by
third party participants under any Participation Agreement or joint operating
agreement.

Section 12. INDEMNIFICATIONS.

(a) INDEMNIFICATIONS BY BOG. BOG agrees to indemnify and
hold harmless Middle Bay and its officers, directors, employees, agents,
and representatives from and against any and all claims, obligations,
actions, liabilities, damages, or expenses of any kind or character
arising out of or resulting from any agreement, arrangement or
understanding alleged to have been made by, or on behalf of, such party
with any broker or finder in connection with this Agreement or the
transactions contemplated hereby.

(b) INDEMNIFICATIONS BY MIDDLE BAY.

(i) GENERAL AND ENVIRONMENTAL. NOTWITHSTANDING ANY
PROVISION HEREOF TO THE CONTRARY, MIDDLE BAY SHALL, FROM AND AFTER
THE EFFECTIVE DATE OF EACH ASSIGNMENT, AGREE TO INDEMNIFY AND HOLD
BOG, ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND
REPRESENTATIVES (HEREIN COLLECTIVELY CALLED THE "BOG INDEMNIFIED
PARTIES") HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS,
OBLIGATIONS, ACTIONS, LIABILITIES, DAMAGES, OR EXPENSES, INCLUDING
WITHOUT LIMITATION COURT COSTS AND ATTORNEYS' FEES (HEREIN
COLLECTIVELY CALLED "CLAIMS"), TO THE EXTENT SUCH CLAIMS AROSE OUT
OF THE PHYSICAL CONDITION, OWNERSHIP AND/OR OPERATION OF THE BOG
PROPERTIES COVERED BY THE SUBJECT ASSIGNMENT INCLUDING, WITHOUT
LIMITATION, ANY CLAIMS ARISING UNDER, OR AS A RESULT OF VIOLATION
OF, APPLICABLE ENVIRONMENTAL LAWS, WHETHER SUCH CLAIMS AROSE
BEFORE, ON, OR AFTER THE APPLICABLE EFFECTIVE DATE, AND WHETHER
DUE, IN WHOLE OR IN PART, TO THE NEGLIGENCE OR STRICT LIABILITY OF
BOG, OTHER THAN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

(ii) COMMISSIONS. Middle Bay agrees to indemnify and
hold harmless BOG and the other BOG Indemnified Parties, from and
against any and all claims, obligations, actions, liabilities,
damages, or expenses of any kind or character arising out of or
resulting from any agreement, arrangement or understanding alleged
to have been made by, or on behalf of, such party with any broker
or finder in connection with this Agreement or the transactions
contemplated hereby.

Section 13. WELL DATA AND INFORMATION.

For each Subject Well, BOG shall provide Middle Bay with the following:
(i) one copy of the AFE submitted for the Subject Well with an estimated
working interest and net revenue interest break down; (ii) one copy of each
drilling and completion report received by BOG for the Subject Well; (iii) one
copy of each well log received by BOG for the Subject Well; and (iv) all data
and information received regarding the testing and analysis of the well. With
respect to each Subject Well which is completed as a producer, following the
completion of such Subject Well BOG shall provide Middle Bay with a copy of
each of the following documents which are in BOG's possession (i) the BOG
Participation Agreements which affect Middle Bay's interests in the Drilling
and Production Unit for the Subject Well, (ii) the operating agreements which
govern the Drilling and Production Unit for the Subject Well, and (iii) a copy
of each oil and gas lease and farm-in agreement which covers minerals which are
located within the Drilling and Production Unit for the Subject Well; provided,
however, that Middle Bay shall reimburse BOG for any third party copying
charges which are incurred to generate such copies. In addition, with respect
to each

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<PAGE> 15
Subject Well which is completed as a producer, subject to any contractual
restrictions that are placed on such interpretations pursuant to the terms of
the applicable Participation Agreement(s) or the applicable seismic acquisition
agreement, BOG shall provide Middle Bay with one copy of a 3-D interpretational
map generated from Seismic Data by BOG for each of the targeted zone(s) in such
Subject Well (if a 3-D interpretational map has been generated by BOG for such
zone), limited in geographical extent to 1/2 mile of the outside perimeter of
the Drilling and Production Unit for the Subject Well. Under no circumstances
shall Middle Bay acquire any ownership interest or license in any of the
Seismic Data.

Section 14. NON-COMPETE.

During the Agreement Term and continuing for a period of 5 years
thereafter, unless BOG agrees in writing otherwise, except as provided in this
Agreement, neither Middle Bay, nor any Affiliate of Middle Bay, nor any broker
or other representative acting on behalf of Middle Bay shall own, purchase or
otherwise acquire any interest in the oil, gas and/or other minerals in, under
or that may be produced from any lands located within any of the following
described lands (hereinafter collectively referred to as the "Non-Compete
Lands"): (1) any lands located within one mile of the outside perimeter of the
drilling and/or proration units which are established for each Subject Well;
and (2) the lands which must be the subject of a non-compete agreement as the
result of the disclosure of 3-D interpretational maps or the assignment of
interests in BOG Properties pursuant to the terms of a Participation Agreement
which is applicable to BOG Properties which are to be assigned to Middle Bay
pursuant to the terms of this Agreement. The interests Middle Bay is precluded
hereunder from owning or acquiring include leasehold working interests, mineral
fee interests or servitudes, overriding royalty interests, royalty interests,
production payments, net profits interests, and any other interests, whether
similar or dissimilar, in the oil, gas and/or other minerals in, under or that
may be produced from any part of the Non-Compete Lands. In the event that
Middle Bay, any Affiliate of Middle Bay or any broker or other representative
acting on behalf of Middle Bay or any Affiliate of Middle Bay owns or acquires
any interest in breach of this Section 14, BOG shall, in addition to any other
remedies it may have at law or in equity, have the right, exercisable in its
sole discretion, to secure from Middle Bay, an Affiliate of Middle Bay and/or
any broker or other representative acting on behalf of Middle Bay or any
Affiliate of Middle Bay, as the case may be, an assignment, free of all cost
and expense, covering the entire interest so owned or acquired in breach of
this Section 14. The provisions of this Section 14 shall survive the
expiration of the Agreement Term and any earlier termination of this Agreement.
Anything to the contrary contained in this Section 14 notwithstanding, the
parties hereto agree that Middle Bay shall not be precluded from acquiring
interests from a third party which is a party to a BOG Participation Agreement,
provided that the interest acquired by Middle Bay from such third party is
subject to the BOG Participation Agreement to which such third party is a
party.

Section 15. ACCOUNTING MATTERS.

On or before a date that is 30 calendar days after the earlier of
expiration of the Agreement Term or termination of this Agreement under Section
10 hereof, BOG shall issue to Middle Bay a statement reflecting the BOG Account
Balance as of the statement date. Along with said statement, BOG shall,
subject to any right of set-off afforded BOG hereunder, return to Middle Bay
the BOG Account Balance, less that portion which BOG believes should be
retained by BOG in order to satisfy Middle Bay's share of any BOG Drilling
Costs or BOG Completion Costs still to be paid or incurred hereunder. On or
before a date that is 120 calendar days after the earlier of expiration of the
Agreement Term or termination of this Agreement under Section 10 hereof, BOG
shall return, subject to any right of set-off afforded BOG hereunder, to Middle
Bay any of the remaining BOG Account Balance, to the extent it exceeds an
amount sufficient to cover Middle Bay's share of any then-accrued BOG Drilling
Costs or BOG Completion Costs.

Section 16. INSURANCE.

Middle Bay agrees to be bound by any election made by BOG concerning
insurance coverage relative to any particular Subject Well, and Middle Bay
shall pay a 12.5% share of what would otherwise be BOG's insurance costs
relative to such Subject Well and any related facilities. Prior to execution
of an Assignment covering such Subject Well, BOG shall make any insurance
elections for and on behalf of Middle Bay, and such election shall be binding

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<PAGE> 16
upon Middle Bay, the same as if made by Middle Bay. For example, if BOG elects
to be covered by the operator's insurance relative to any particular Subject
Well, so will Middle Bay and if BOG decides to secure or utilize its own
insurance coverage relative to any particular Subject Well, Middle Bay's
interest in the Subject Well shall also rely upon such insurance coverage;
Middle Bay shall pay a 12.5% share of BOG's costs in securing insurance
coverage relative to any particular Subject Well. If BOG decides to secure or
utilize its own insurance coverage relative to a Subject Well, Middle Bay will
be named as an additional insured in the certificate issued for such coverage.

Section 17. NOTICES.

All notices and other communications required under this Agreement shall
(unless otherwise specifically provided herein) be in writing and be delivered
personally, by recognized commercial courier or delivery service (which
provides a receipt), by telex or telecopier (with receipt acknowledged), or by
registered or certified mail (postage prepaid), at the following addresses:

If to Middle Bay:
115 S. Dearborn Street
Mobile, Alabama 36602
or
P.O. Box 390
Mobile, Alabama 36601
Facsimile # (334) 433-7802
Attention: Mr. John Bassett

If to BOG:
Brigham Oil & Gas, L.P.
5949 Sherry Lane, Suite 1616
Dallas, Texas 75225
Facsimile # (214) 360-9825
Attention: Mr. Bud Brigham

and shall be considered delivered on the date of receipt. Either Middle Bay or
BOG may specify as its proper address any other post office address within the
continental limits of the United States by giving notice to the other party, in
the manner provided in this Section, at least two (2) business days prior to
the effective date of such change of address.

Section 18. SURVIVAL OF PROVISIONS.

All representations, warranties and indemnifications made herein by BOG
or Middle Bay shall survive in perpetuity the expiration of the Agreement Term
and any termination hereof under Section 10.

Section 19. DISCLAIMERS AND ELECTIONS.

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<PAGE> 17

Section 20. MISCELLANEOUS MATTERS.

a. Neither Middle Bay nor BOG shall assign or otherwise transfer
any rights, interests or obligations under this Agreement to any third
party without first obtaining the written consent of the other, which
consent may be either granted or withheld in the sole and absolute
discretion of the party being asked to grant consent; provided that
either of BOG or Middle Bay may freely transfer or otherwise dispose of
all of its rights, interests and obligations hereunder (i) by sale or
other transfer or disposition of all or substantially all of its assets
(whether or not covered hereby) to an Affiliate or (ii) otherwise by
merger, reorganization or consolidation. This Agreement shall be binding
upon and shall enure to the benefit of Middle Bay and BOG and their
respective permitted successors and assigns.

b. Each party shall bear and pay all expenses (including without
limitation attorneys' fees) incurred by it in connection with the
transaction contemplated by this Agreement.

d. This Agreement may be amended, modified, supplemented,
restated or discharged (and provisions hereof may be waived) only by an
instrument in writing signed by the party against whom enforcement of the
amendment, modification, supplement, restatement or discharge (or waiver)
is sought.

e. Without limitation of BOG's right to be paid the Termination
Amount upon terms and conditions set forth in Section 10 above, BOG and
Middle Bay do hereby covenant and agree that the recovery by either party
hereto of any damages suffered or incurred by it as a result of any
breach by the other party of any provision of this Agreement shall be
limited to the actual damages suffered or incurred by the non-breaching
party as a result of the breach by the breaching party and in no event
shall the breaching party be liable to the non- breaching party for any
interest, consequential, special, exemplary or punitive damages suffered
or incurred by the non-breaching party as a result of the breach by the
breaching party.

g. This Agreement may be executed in counterparts, all of which
are identical and all of which constitute one and the same instrument.
It shall not be necessary for BOG and Middle Bay to sign the same
counterpart and signature pages from different counterparts may be
combined to form masters of this Agreement.

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<PAGE> 18
This Agreement is executed by the parties hereto on the date set
forth beneath the signature of each but is effective for all purposes as of
April 1, 1996.

BRIGHAM OIL & GAS, L.P.

By: Brigham Exploration Company
Its: Managing General Partner

By:/s/ BEN M. BRIGHAM
--------------------------------
Name: Ben M. Brigham
Title: President / CEO
Date: April 3, 1996

MIDDLE BAY OIL COMPANY, INC.

By:/s/ JOHN J. BASSETT
---------------------------------
Name: John J. Bassett
Title: President
Date: April 3, 1996

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<PAGE> 1
EXHIBIT 10.17.1

AMENDMENT

RECITALS:

1. Effective as of April 1, 1996, Brigham Oil & Gas, L.P. ("BOG") and
Middle Bay Oil Company, Inc. ("Middle Bay") entered into that certain
Expense Allocation and Participation Agreement (as heretofore amended,
herein called the "Agreement"); all capitalized terms used but not
defined herein shall have the meanings assigned to them in the
Agreement.

AGREEMENT:

FOR A GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which are
hereby acknowledged, BOG and Middle Bay hereby amend the Agreement such that
(a) the amount of $1,500,000 as found in the definition of Agreement Term shall
be replaced with the amount of $1,542,500, and (b) solely for purposes of the
AFE relating to the Mustang Well, (i) the dollar figure of $280,000 as found in
the Agreement in the third and sixth sentences of the definition of BOG
Properties shall be replaced with the dollar figure of $450,000, and (ii) the
fourth sentence of the definition of BOG Properties shall be replaced with the
following:

"By way of illustration, assume that (a) the estimated BOG Drilling
Cost for the Mustang Well (being a Subject Well) are $540,000 and thus
exceed the amount of $450,000 by exactly 20%, and (b) the Drilling and
Production Unit for such Mustang Well covers 80 acres and as part of
the BOG Properties BOG owns an undivided seventy percent interest in
and oil and gas lease (for purposes of this example referred to as the
"Lease") covering 60 net mineral acres in the Drilling and Production
Unit and an undivided 40% interest in the minerals (for purposes of
this example referred to as the "Minerals") covering the other 20 net
mineral acres in the Drilling and Production Unit."

MISCELLANEOUS:

1. This Amendment shall be binding upon and shall enure to the benefit
of Middle Bay and BOG, and their respective successors and assigns,
forever.

2. This Amendment may be executed in multiple counterparts, all of which
are identical. All of such counterparts together shall constitute one
and the same instrument. If counterparts of this Amendment are
executed, the signatures of the parties may be combined in and treated
and given effect for all purposes as a single instrument.
<PAGE> 2
3. This Amendment shall be governed by and construed in accordance with
the laws of the State of Texas, without regard to principles of
conflicts of laws.

Executed by the parties hereto on the dates set forth below the
signature of each.

BRIGHAM OIL & GAS, L.P.
by Brigham Exploration Company,
its Managing General Partner

By:/s/ ANNE L. BRIGHAM
----------------------------------------
Anne L. Brigham, Executive Vice President
Date: September 26, 1996

MIDDLE BAY OIL COMPANY, INC.

By:/s/ JOHN J. BASSETT
----------------------------------------
John J. Bassett, President
Date: September 26, 1996

<PAGE> 1
EXHIBIT 10.17.2

[BRIGHAM OIL & GAS, L.P. LETTERHEAD]

May 20, 1996

Mr. John Bassett
Middle Bay Oil Company, Inc.
115 S. Dearborn Street
P.O. Box 390
Mobile, Alabama 36601

Re: Amendment to Expense Allocation and Participation
Agreement by and between Brigham Oil & Gas, L.P.
("BOG") and Middle Bay Oil Company, Inc. ("Middle
Bay"), dated effective as of April 1, 1996 (the
"Agreement")
Dear John:

Middle Bay and BOG recognize and acknowledge that part of the
definition of "BOG Properties" contained in the Agreement provides as follows:

However, in the event that prior to the Completion of a Subject Well
BOG has assigned or has agreed to assign interests in properties,
rights or interests which are related to such Subject Well or the
Drilling and Production Unit for the applicable Subject Well, the
interests in such properties, rights or interests which BOG has
assigned or agreed to assign shall not be part of the BOG Properties
for purposes of this Agreement.

Middle Bay and BOG also recognize and acknowledge that BOG has entered
into an agreement (hereinafter referred to as the "Gasco Agreement") with Gasco
Limited Partnership ("Gasco") which provides for Gasco's participation in BOG
Properties and Subject Wells pursuant to the same terms as are provided for
Middle Bay's participation in BOG Properties and Subject Wells. As such,
pursuant to the definition of BOG Properties currently contained in the
Agreement, the interests to be assigned to Gasco under the terms of the Gasco
Agreement would not be part of the BOG Properties and thus Middle Bay's
participation in such BOG Properties and Subject Wells would be proportionately
reduced to account for the interest to be assigned to Gasco.

Middle Bay and BOG hereby agree, however, that, anything to the
contrary contained in the Agreement notwithstanding, the interests that are to
be assigned to Gasco pursuant to the terms of the Gasco Agreement shall be part
of the BOG Properties for purposes of determining Middle Bay's participation
and interest in BOG Properties and Subject Wells under the Agreement.

Except as provided above, the Agreement shall remain in full force and
effect as to all of its terms.

If this letter amendment accurately reflects our agreement and
understanding, please sign the duplicate originals hereof below and return one
of such duplicate originals to BOG.

Sincerely,
BRIGHAM OIL & GAS, L.P.
by Brigham Exploration Company,
its Managing General Partner

/s/ ANNE L. BRIGHAM
Anne L. Brigham
Executive Vice President

Agreed and Accepted this 21st day of May, 1996:
MIDDLE BAY OIL COMPANY, INC.

By: /s/ JOHN J. BASSETT
---------------------------------
(name printed) John J. Bassett
----------------------
Its: President
--------------------------------

<PAGE> 1
EXHIBIT 18

ANADARKO BASIN JOINT PARTICIPATION AGREEMENT

This Anadarko Basin Joint Participation Agreement (this "Agreement")
is dated effective as of the 1st day of May, 1996, and is by and among STEPHENS
PRODUCTION COMPANY ("Participant") and BRIGHAM OIL & GAS, L.P. ("BOG")
(Participant and BOG are sometimes referred to herein individually as "Party"
and collectively as "Parties");

WITNESSETH:

WHEREAS, the Parties desire to create an area of mutual interest
("AMI") for oil and/or gas exploration and development purposes; and

WHEREAS, the Parties have reached an agreement with respect to the
evaluation by them of areas that have been identified by BOG within the AMI and
areas which may in the future be identified by BOG within the AMI (hereinafter
referred to as "Project Areas"); and

WHEREAS, the Parties have also reached an agreement with respect to
certain matters concerning the ownership of seismic permits (hereinafter
referred to as "Seismic Permits"), oil and/or gas lease option agreements
(hereinafter referred to as "Options"), oil and/or gas leases (hereinafter
referred to as "Leases") and other agreements to obtain interests in oil and/or
gas leases, mineral interests or royalty interests (hereinafter referred to as
"Farm-Ins") covering portions of the AMI and the Parties' future oil and/or gas
exploration and development operations within the AMI;

ARTICLE I.
RELATIONSHIP OF PARTIES

Section 1.2. Definition of Affiliate. For purposes of this
Agreement "Affiliate" means any parent or subsidiary of a Party and any
individual, corporation, joint venture, partnership, trust or other entity
controlling, controlled by or under common control with the Party. For
purposes of this Section 1.2, the concept of control meaning the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of another, whether through ownership of voting
securities, by contract or otherwise.

ARTICLE II.
AREA OF MUTUAL INTEREST

<PAGE> 2

and continue until the earlier to occur of: (i) two (2) years from the
effective date hereof; (ii) such time as BOG has designated Project Areas (in
accordance with the provisions of Section 3.1 below) hereunder within which BOG
reasonably estimates that the Parties will conduct three-dimensional seismic
operations (hereinafter referred to as "3-D Operations") meeting the commitment
set forth in Article II of that certain Anadarko Basin Seismic Operations
Agreement dated effective as of February 15, 1996 with Veritas Geophysical,
Ltd. ("Veritas"), as amended, a copy of which is attached hereto as Exhibit D
(hereinafter referred to as the "Veritas Agreement"), after taking into
consideration any 3-D Operations which BOG may have conducted under the Veritas
Agreement within Excluded Existing BOG Project Areas, Excluded Exempt Lands
Project Areas, Excluded Future Third-Party Project Areas, Excluded Stephens
Existing Property Project Areas, or Excluded BOG Producing Property Project
Areas. Without the mutual agreement of both of the Parties hereto, no
additional Project Areas will be established under the terms of this Agreement
following the termination of the AMI as aforesaid. The Parties recognize that
the termination of the AMI hereunder will not act to terminate the Geophysical
Exploration Agreements executed by the Parties for previously designated
Project Areas as set forth in Section 3.2 below or the separate areas of mutual
interest established under such Geophysical Exploration Agreements.

Section 2.2. Excluded Existing BOG Project Areas. The Parties
agree that all of the lands described in Exhibit B which is attached hereto and
incorporated herein (hereinafter referred to as the "Exhibit B Lands") shall be
deemed to be excluded from the AMI hereunder and all of the terms and
provisions of this Agreement (hereinafter referred to as "Excluded Existing BOG
Project Areas").

Section 2.3. Project Areas Which BOG Elects to Treat as Exempt
Lands Under Veritas Agreement. The Parties recognize and acknowledge that
under the terms of Section 3.3 of the Veritas Agreement BOG has the right to
designate to Veritas in writing all or part of a Project Area for which BOG
shall pay one hundred five percent of the Turnkey Charge (as such term is
defined in the Veritas Agreement) and one hundred percent of all of the other
Seismic Acquisition Costs (as such term is defined in the Veritas Agreement) in
order to receive immediate ownership of all interests in the seismic data
covering such lands (the lands so designated being referred to in the Veritas
Agreement as "Excluded Lands," but being herein referred to as "Exempt Lands").
The Parties agree that in the event that BOG elects to designate an entire
Project Area as Exempt Lands under the Veritas Agreement (hereinafter referred
to as an "Exempt Lands Project Area"), Participant shall have the option to
participate, or not participate, in such Exempt Lands Project Area. However,
BOG agrees that it will not designate an entire Project Area as an Exempt Lands
Project Area unless BOG has entered into an agreement with a third party that
owns substantial mineral and/or leasehold interests within the Project Area and
such agreement provides that the third party is to have some ownership in
seismic data or contains confidentiality restrictions with respect to the
seismic data which are inconsistent with the confidentiality provisions set
forth in the Veritas Agreement. In the event that BOG designates, or intends
to designate, an entire Project Area as an Exempt Lands Project Area under the
Veritas Agreement, BOG shall notify Participant in writing of such designation,
or intended designation. Participant must then make its election in writing
within fifteen (15) days whether to participate, or not participate, in such
Exempt Lands Project Area; provided, however, that in the event that
Participant fails to notify BOG in writing of its election prior to the
expiration of such fifteen (15) day period, Participant shall be deemed to have
elected not to participate in the Exempt Lands Project Area. In the event that
Participant either elects, or is deemed to have elected, not to participate in
the Exempt Lands Project Area, such Exempt Lands Project Area shall be deemed
to be excluded from the AMI and all of the terms of this Agreement (hereinafter
referred to as an "Excluded Exempt Lands Project Area"). In the event that
Participant elects to participate in an Exempt Lands Project Area as provided
herein, anything to the contrary contained elsewhere herein or in the form
Geophysical Exploration Agreement which is attached hereto as Exhibit C
notwithstanding, Participant shall pay for fifty percent (50%) of all of the
costs, charges and expenses which are required to be paid by BOG to Veritas
under Section 3.3 of the Veritas Agreement for the conduct of the 3-D
Operations within such Exempt Lands Project Area.

Section 2.4. Project Areas Which are Treated as Terrain Excluded
Project Areas Under Veritas Agreement. The Parties recognize and acknowledge
that under the terms of Section 2.6

Anadarko Basin Joint Participation Agreement

<PAGE> 3

of the Veritas Agreement certain project areas may be excluded from the Veritas
Agreement in the event that Veritas has notified BOG that there are problems
with the terrain conditions for such project area and BOG and Veritas fail to
reach agreement on a Turnkey Charge (as such term is defined in the Veritas
Agreement) for the project area (such project area being referred to in the
Veritas Agreement and hereinafter in this Agreement as a "Terrain Excluded
Project Area"). The Parties agree that all Terrain Excluded Project Areas
shall be deemed to be excluded from the AMI and all of the terms of this
Agreement.

Section 2.5. Future Third-Party Generated Project Areas.

(a) If during the term of this Agreement a third-party offers BOG
the opportunity to participate in an oil and gas exploration project within the
AMI which (i) was not previously identified or generated by BOG, (ii) includes
the conduct of 3-D Operations and (iii) either (x) includes terms under which
BOG will acquire the interest in the project subject to a promote or carry of
any kind (in whole or in part and whether temporary or permanent) or (y)
includes terms under which BOG will acquire less than all of the working
interest and/or ownership interest (other than royalties or retained overriding
royalties) in the lands covered by the project (each such project which meets
all of (i), (ii) and (iii) above to be hereinafter referred to as "Future
Third-Party Project Areas") and BOG desires to participate in such Future
Third-Party Project Area, then BOG shall notify Participant of the terms of
such offer. Participant must notify BOG in writing within fifteen (15) days of
its receipt of such notice as to whether Participant shall participate in the
Future Third-Party Project Area; provided, however, that in the event that
Participant fails to notify BOG in writing of its election prior to the
expiration of such fifteen (15) day period, Participant shall be deemed to have
elected not to participate in the Future Third-Party Project Area. In the
event that Participant either elects, or is deemed to have elected, not to
participate in the Future Third-Party Project Area, such Future Third- Party
Project Area shall be deemed to be excluded from the AMI and all of the terms
of this Agreement (hereinafter referred to as an "Excluded Future Third-Party
Project Area") and BOG shall not be obligated to include Participant in any
exploration and/or development operations conducted within such Excluded Future
Third-Party Project Area.

(b) In the event that Participant elects to participate in a
Future Third-Party Project Area and BOG is not required to provide geophysical
expertise or support for the 3-D Operations to be conducted within the Future
Third- Party Project Area, Participant shall pay its heads-up share (being
31.25%) of all costs, expenses or consideration that BOG is required to pay
pursuant to the terms under which such Third-Party Project Area is offered. In
such event, Participant shall pay its heads-up share of all of such costs,
expenses and consideration on or before the date on which such payment is due
pursuant to the terms of participation which are set forth for the Future
Third-Party Project Area with the third-party.

(c) In the event that Participant elects to participate in a
Future Third-Party Project Area and BOG is to provide to such third-party
geophysical expertise or support for the 3-D Operations to be conducted within
the Future Third-Party Project Area, Participant shall pay (i) fifty percent
(50%) of all of the Geophysical Program Costs (as such term is defined in
Section 2.4 of the form Geophysical Exploration Agreement which is attached
hereto as Exhibit C) incurred within the Future Third-Party Project Area, (ii)
fifty percent (50%) of all of the land costs incurred prior to the completion
of final processing of the Program Data (as defined in Section 3.3 of the form
Geophysical Exploration Agreement which is attached hereto as Exhibit C), (iii)
in the event that BOG is required to pay in excess of fifty percent (50%) of
all Geophysical Program Costs and/or land costs incurred prior to the
completion of final processing of the Program Data pursuant to the terms under
which such Third-Party Project Area is offered, Participant shall pay its
heads-up share (being 31.25%) of such excess above fifty percent (50%), and
(iv) its heads-up share (being 31.25%) of all other costs, expenses or
consideration that BOG is required to pay (other than any costs and expenses
that Participant must pay under (i), (ii) or (iii) above) pursuant to the terms
under which such Third-Party Project Area is offered. However, in the event
that under the terms of the third-party offer BOG is to be assigned less than
all of the ownership interest (save and except any overriding royalties and
lessors' royalties) in the Future Third-Party Project Area, then the amounts
that Participant shall be required to pay under (i) and (ii) above shall be
reduced in the proportion that the ownership interest being assigned to BOG
bears to the total ownership interest in the Future Third- Party Project Area.
In

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<PAGE> 4

the event that Participant elects to participate in a Future Third-Party
Project Area, the consideration set forth in (i) and (ii) above shall be paid
by Participant to BOG in accordance with the terms that are set forth in the
form Geophysical Exploration Agreement which is attached hereto as Exhibit C
and the consideration due under (iii) above shall be paid by Participant to BOG
before such payment is due to the third-party or any other party pursuant to
the terms of participation which are set forth for the Future Third-Party
Project Area with the third-party.

(d) In the event that Participant elects to participate in a
Future Third-Party Project Area under the terms set forth herein, BOG shall
assign Participant thirty-one and one-quarter percent (31.25%) of all of the
interest in the Third-Party Project Area which is assigned to BOG by the
third-party.

(e) The Parties expressly acknowledge and agree that in the event
that BOG identifies a potential Project Area and subsequently enters into an
agreement with a third-party to acquire all or part of such third-party's
interests within the Project Area (e.g. a "shoot to earn" type of arrangement),
despite the fact that BOG may be earning or acquiring less than all of such
third-party's interests in such Project Area or that BOG may have agreed to pay
a carry or promote to acquire all or part of such third-party's interest in the
Project Area, such Project Area shall not be deemed to be a Future Third-Party
Project Area for purposes of this Section 2.5, but rather shall be deemed to be
a normal Project Area for purposes of this Agreement.

Section 2.6. Excluded Stephens Existing Property Project Areas.
In the event that Participant or any of its Affiliates own or hereafter acquire
an interest in (i) oil and/or gas leases, (ii) oil, gas or related hydrocarbon
mineral interests, or (iii) other interests of any kind in oil, gas or their
related hydrocarbons, other than Participant Acquired Interests (as defined in
Section 5.3 below) in which BOG has elected to participate (the interests
described in (i), (ii) and (iii) above, save and except Participant Acquired
Interests in which BOG has elected to participate, being herein referred to as
"Existing Properties") and BOG subsequently intends to include such Existing
Properties within a Project Area (such Project Area being hereinafter referred
to as a "Stephens Existing Property Project Area"), BOG shall notify
Participant in writing of BOG's intent to designate such Stephens Existing
Property Project Area as a Project Area hereunder. However, unless the
Parties mutually agree in writing upon the terms for BOG's participation in the
Existing Properties owned by Participant or its Affiliates within such Stephens
Existing Property Project Area within thirty (30) days of Participant's receipt
of BOG's notice, such Stephens Existing Property Project Area shall be deemed
to be excluded from the AMI and all of the terms and provisions of this
Agreement (hereinafter referred to as an "Excluded Stephens Existing Property
Project Area"). The Parties recognize and agree that under the terms of this
Agreement neither Party shall have any responsibility of any kind to the other
Party hereto with respect to any Excluded Stephens Existing Property Project
Area. The Parties recognize and agree that in the event a Project Area has
already been designated pursuant to the provisions of Section 3.1 and the
Parties have executed a Geophysical Exploration Agreement for such Project Area
as provided in Section 3.2 below, the terms and provisions of such Geophysical
Exploration Agreement shall govern any subsequent acquisition of Existing
Properties within that Project Area.

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<PAGE> 5

election to participate or not participate in the acquisition of such a
Producing Property and its associated BOG Producing Property Project Area by
delivering its written election to BOG within thirty (30) days of its receipt
of a written notice from BOG setting forth the terms upon which BOG intends to
acquire the Producing Property. In the event that Participant fails to deliver
its written election to BOG's offices prior to the expiration of such thirty
(30) day period, Participant shall be deemed to have elected not to participate
in the acquisition of the Producing Property and the associated BOG Producing
Property Project Area. In the event that Participant elects to participate in
a BOG Producing Property, Participant shall only be required to pay its
thirty-one and one-quarter percent (31.25%) ownership interest share of the
costs that are paid directly to the sellers of such Producing Property;
however, Participant shall still be responsible for fifty percent (50%) of all
Land Costs (as such term is defined in Section 5.1 below) related to such
Producing Property other than the costs that are paid directly to the seller
and fifty percent (50%) of all Geophysical Program Costs (as such term is
defined in Section 2.4 of the form Geophysical Exploration Agreement which is
attached hereto as Exhibit C) incurred by the Parties within such BOG Producing
Property Project Area. In the event that the Participant elects, or is deemed
to have elected, not to participate in the acquisition of a Producing Property
and its associated BOG Producing Property Project Area (the Producing Property
Project Areas in which Participant elects or is deemed to have elected not to
participate being hereinafter referred to as the "Excluded BOG Producing
Property Project Areas") as aforesaid, the Excluded BOG Producing Property
Project Area shall be deemed to be excluded from the AMI hereunder. The
Parties recognize and agree that in the event a Project Area has already been
designated pursuant to the provisions of Section 3.1 and the Parties have
executed a Geophysical Exploration Agreement for such Project Area as provided
in Section 3.2 below, the terms and provisions of such Geophysical Exploration
Agreement shall govern any subsequent acquisition of Producing Properties
within that Project Area.

Section 2.8. Other Acquisitions of Producing Properties. The
Parties recognize and agree that in the event that either Party acquires or
intends to acquire any Producing Properties which are not located within a
Project Area which has been designated hereunder and such Party does not intend
to subsequently participate in the conduct of 3-D Operations across such
Producing Properties prior to the termination of the AMI hereunder, anything to
the contrary contained in this Agreement notwithstanding, such Party shall not
be required to offer to allow the other Party hereto to participate in such
Producing Properties and the Producing Properties shall not be subject to the
terms of this Agreement.

ARTICLE III.
ESTABLISHMENT OF PROJECT AREAS

Section 3.1. Project Area Development. The Parties recognize that
during the term of the AMI BOG will, utilizing reasonable criteria under the
circumstances as they exist at such time, delineate Project Areas over which
BOG is interested in conducting 3-D Operations in order to evaluate such
Project Areas. Each Project Area shall be a separate and discrete geographical
area. Once BOG has decided to pursue potential 3-D Operations within a Project
Area, BOG shall notify Participant in writing of the Project Area, designating
the Project Area by describing the geographical area included in the Project
Area, providing an estimate of the time frame for the conduct of 3-D Operations
within the Project Area and providing an estimate of the cost of such 3-D
Operations within the Project Area. However, at any time prior to the
commencement of the 3-D Operations within a Project Area BOG shall have the
right to amend the geographical area covered by the Project Area by giving
Participant written notice of the amended description of the geographical area
covered by such Project Area. In addition, the Parties recognize that in
accordance with the terms of the form Geophysical Exploration Agreement which
is attached hereto as Exhibit C, following the conduct of a Geophysical Program
within a Project Area, the size of such Project Area may be reduced as set
forth in the form Geophysical Exploration Agreement. During the term of the
AMI hereunder, BOG shall not have the right to conduct 3-D Operations within
the AMI without Participant's participation as set forth in this Agreement,
other than within Excluded Existing BOG Project Areas, Excluded Exempt Lands
Project Areas, Terrain Excluded Project Areas, Excluded Future Third-Party
Project Areas, Excluded Stephens Producing Property Project Areas, and Excluded
BOG Producing Property Project Areas.

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<PAGE> 6

Section 3.2. Execution of Geophysical Exploration Agreement for
Each Project Area. Within fifteen (15) days of Participant's receipt of BOG's
notice of the designation of each Project Area as set forth in Section 3.1
above, the Parties shall execute a separate Geophysical Exploration Agreement
for each such Project Area in the form attached hereto as Exhibit C, being
completed to reflect the geographical area of the Project Area and any
additional burdens that may have been established in accordance with the terms
and provisions of Article IV below. The effective date of each Geophysical
Exploration Agreement to be executed by the Parties shall be the date that BOG
sends the notice of the designation of such Project Area to Participant.
Following the execution of a Geophysical Exploration Agreement for a Project
Area, such Project Area shall no longer be subject to the terms and conditions
of this Agreement but shall, from and after such date, be governed solely by
the terms and conditions of the executed Geophysical Exploration Agreement;
provided, however, that nothing contained herein shall be construed to relieve
any Party from liabilities or obligations (whether monetary or otherwise) that
accrued prior to such date with respect to the subject Project Area. Anything
to the contrary contained herein notwithstanding, Participant recognizes that
it does not have the right to participate in any Project Areas established by
BOG which cover any part of either the Excluded Existing BOG Project Areas,
Excluded Exempt Lands Project Areas, Terrain Excluded Project Areas, Excluded
Future Third-Party Project Areas, Excluded Stephens Existing Property Project
Areas or Excluded BOG Producing Property Project Areas.

ARTICLE IV.
PROJECT AREA BURDENS

Section 4.1. BOG Override. Participant agrees that its interest
in all Options, Leases and Farm-Ins that are currently owned or hereafter
acquired within the Project Areas shall be burdened with an overriding royalty
in all oil, gas and other minerals in, under and that may be produced, saved
and marketed pursuant to such Leases, Options and Farm-ins, in favor of BOG
(hereinafter referred to as the "BOG Override"), in an amount equal to the
lesser of: (i) two percent (2% of 8/8ths); or (ii) the positive difference, if
any, between 25% and all existing royalty and overriding royalty burdens, it
being understood that the BOG Override is not to reduce the net revenue
interest in any Option, Lease or Farm-In below 75%. All permitted third-party
burdens and lease burdens identified in Sections 4.2 and 4.3 below shall be
calculated and applied to all Options, Leases and Farm-Ins prior to the
calculation and assessment of the BOG Override.

Section 4.2. Other Third-Party Burdens. Participant expressly
recognizes and agrees that its interests (whether now owned or hereafter
acquired pursuant hereto) in portions of the AMI shall be burdened with
overriding royalties in favor of (i) MXC Exploration Company (hereinafter
referred to as "MXC") under and pursuant to the terms of that certain MXC
Exploration Company Consulting Agreement dated February 28, 1994 (a copy of
which is attached hereto as Exhibit F-1), by and between MXC and BOG (such
overriding royalty being hereinafter referred to as the "MXC Override"), (ii)
overriding royalties in favor of Barclay pursuant to the terms of that certain
Area of Mutual Interest Agreement dated August 1, 1994 (a copy of which is
attached hereto as Exhibit F-2), by and between BOG and Barclay (such
overriding royalty being hereinafter referred to as the "Barclay I Override"),
(iii) overriding royalties in favor of Barclay pursuant to the terms of that
certain Area of Mutual Interest Agreement dated April 1, 1996 (a copy of which
is attached hereto as Exhibit F-3), by and between BOG and Barclay (such
overriding royalty being hereinafter referred to as the "Barclay II Override")
and/or (iv) overriding royalties in favor of James E. Goudie (hereinafter
referred to as "Goudie") pursuant to the terms of that certain Area of Mutual
Interest Agreement dated October 1, 1994 (a copy of which is attached hereto as
Exhibit F-4), by and between BOG and Goudie (such overriding royalty being
hereinafter referred to as the "Goudie Override"). Participant also recognizes
and agrees that in its efforts to delineate Project Areas and obtain geological
consulting services within Project Areas, BOG may enter into agreements with
other third-party geologists and/or companies under which such third-parties
are due overriding royalties (hereinafter referred to as "Third-Party
Overrides") which shall proportionately burden both BOG's and Participant's
interests in all or parts of the AMI. Participant agrees that to the extent
that the MXC Override, the Barclay I Override, the Barclay II Override, the
Goudie Override or any other Third-Party Override burdens the applicable
Project Area, the Geophysical

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<PAGE> 7

Exploration Agreement executed for such Project Area shall provide that such
Overrides proportionately burden the Parties' Ownership Interests in the
Project Area.

Section 4.3. Lease Burdens. Neither Party hereto shall burden or
encumber the other Party's legal or equitable interest in any Option, Lease or
Farm-In located within the AMI with any overriding royalty, production payment,
mortgage, security interest, or other burden except as provided in Sections 4.1
and 4.2 above, without the consent of the other Party hereto; provided,
however, that in its efforts to obtain an Option, Lease or Farm-In (as such
terms are defined in the form Geophysical Exploration Agreement which is
attached hereto as Exhibit C), a Party may grant or otherwise burden an Option,
Lease or Farm-In with a royalty, overriding royalty, production payment or
other similar burden in favor of a third party owning the rights to the
minerals underlying such Option, Lease or Farm-In or owning the rights to oil
and/or gas leases which are the subject to an Option or Farm-In (farmor,
mineral owner, assignor, lessee or lessor) in such Party's reasonable efforts
to obtain the Option, Lease or Farm-In.

ARTICLE V.
OBTAINMENT OF SEISMIC PERMITS, OPTIONS, LEASES
AND FARM-INS PRIOR TO DESIGNATION OF PROJECT AREAS

Section 5.2. Ownership and Assignment of Seismic Permits, Options,
Leases and Farm-Ins Acquired by BOG but Not Included Within Designated Project
Areas at the Termination of the AMI. The Parties agree that in the event that
any Seismic Permits, Options, Leases or Farm-Ins have been acquired by BOG
within the AMI (as modified as provided in Sections 2.2, 2.3, 2.4, 2.5, 2.6,
2.7 and 2.8) prior to the effective date hereof or are acquired by BOG within
the AMI during the term hereof, BOG shall own an undivided sixty-eight and
three-quarters percent (68.75%) and Participant shall own an undivided
thirty-one and one-quarter percent (31.25%) interest in such Seismic Permits,
Options, Leases or Farm-Ins; provided, however, that, except as provided below
in this Section 5.2, legal title to such Seismic Permits, Options, Leases and
Farm-Ins shall not be assigned to Participant until after the applicable
Seismic Permit, Option, Lease or Farm-In has been included within a designated
Project Area and the Geophysical Exploration Agreement executed for such
Project Area shall then govern the terms of the assignment of legal title to
the Parties. Anything to the contrary contained above notwithstanding, the
Parties agree that in the event that any Seismic Permits, Options, Leases or

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<PAGE> 8

Farm-Ins are not included within a designated Project Area prior to the
expiration of the term of this Agreement and Participant has paid its share of
all Land Costs associated with such Seismic Permits, Options, Leases or
Farm-Ins, promptly following the expiration of the term of this Agreement BOG
shall assign and convey to Participant it's undivided thirty-one and
one-quarter percent (31.25%) ownership interest in such Seismic Permits,
Options, Leases and/or Farm-Ins utilizing the general form of assignment which
is attached hereto as Exhibit E.

Section 5.3. Participant's Acquisition of Seismic Permits,
Options, Leases and Farm-Ins Prior to Designation of Project Areas. In the
event that at any time after the effective date of this Agreement Participant
acquires an interest in a Seismic Permit, Option, Lease or Farm-In within the
AMI prior to BOG's designation of a Project Area covering the acreage which is
the subject of such Seismic Permit, Option, Lease and/or Farm-In, BOG shall
have an election to participate, or not participate, in such Seismic Permit,
Option, Lease or Farm-In. As such, should Participant acquire a Seismic
Permit, Option, Lease or Farm-In prior to BOG's designation of a Project Area
covering the acreage which is the subject of such Seismic Permit, Option, Lease
or Farm-In, by purchase, exchange, gift or otherwise (such Seismic Permit,
Lease, Option or Farm-In acquired by Participant as set forth above being
herein called a "Participant Acquired Interest"), Participant shall promptly
(but in any event within 30 days of the acquisition) notify BOG, in writing, of
such acquisition together with the material terms of the Participant Acquired
Interest. BOG shall, within thirty (30) days after receipt of such a notice
from Participant, notify Participant, in writing, whether it wishes to
participate in such acquisition; provided that failure to respond within the
time and in the manner set forth above shall be deemed to be an election by BOG
to not participate in the Participant Acquired Interest. However, if BOG
reasonably desires additional information with respect to a Participant
Acquired Interest before it makes its election whether or not to participate in
the acquisition of the Participant Acquired Interest, BOG may notify
Participant in writing within fifteen (15) days of its receipt of Participant's
notice, detailing in such notice to Participant the additional information
reasonably desired by BOG, and BOG shall have fifteen (15) days from the date
of its receipt of the additional information it has reasonably requested from
Participant in which to make its election whether to participate in the
acquisition of the Participant Acquired Interest. Should BOG elect to
participate in a Participant Acquired Interest, Participant shall pay fifty
percent (50%) and BOG shall pay fifty percent (50%) of all Land Costs
reasonably and prudently incurred (in light of the circumstances then in
existence) in acquiring such Participant Acquired Interest. In the event that
BOG elects to participate in a Participant Acquired Interest, BOG shall
reimburse Participant for BOG's share of the Land Costs related to such
Participant Acquired Interest within thirty (30) days of its receipt of an
invoice from Participant indicating the amount due. In the event that BOG
elects not to participate in a Participant Acquired Interest, Participant shall
be responsible for all of the Land Costs related to such Participant Acquired
Interest. Anything to the contrary contained in this Section 5.3 or in Section
5.4 below notwithstanding, if Producing Properties are acquired by Participant
and Participant does not intend to subsequently participate in the conduct of
3-D Operations across such Producing Properties prior to the termination of the
AMI hereunder, such acquisition shall not be deemed to be a Participant
Acquired Interest for purposes of this Section 5.3, but rather shall be
governed by the terms and provisions of Section 2.8 above.

Section 5.4. Ownership and Assignment of Seismic Permits, Options,
Leases and Farm-Ins Acquired by Participant Prior to Designation of a Project
Area. The Parties agree that in the event that BOG elects to participate in a
Participant Acquired Interest as set forth in Section 5.3 above, BOG shall own
an undivided sixty-eight and three- quarters percent (68.75%) and Participant
shall own an undivided thirty-one and one-quarter percent (31.25%) interest in
such Participant Acquired Interest; provided, however, that, except as provided
below in this Section 5.4, legal title to such Participant Acquired Interest
shall not be assigned to BOG until after the applicable Participant Acquired
Interest has been included within a designated Project Area and the Geophysical
Exploration Agreement executed for such Project Area shall then govern the
terms of the assignment of legal title to the Parties. Anything to the
contrary contained above notwithstanding, the Parties agree that in the event
that any Participant Acquired Interests are not included within a designated
Project Area prior to the expiration of the term of this Agreement and BOG has
elected to participate in such Participant Acquired Interest and has paid its
share of all Land Costs associated with such Participant Acquired Interest as
set forth in Section 5.3 above, promptly following the expiration of the term
of this Agreement Participant

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<PAGE> 9

shall assign and convey to BOG it's undivided sixty-eight and three-quarters
percent (68.75%) ownership interest in such Participant Acquired Interest
utilizing the general form of assignment which is attached hereto as Exhibit E.
In the event that BOG elects not to participate in a Participant Acquired
Interest, such Participant Acquired Interest shall be owned solely by
Participant and anything to the contrary contained in this Agreement
notwithstanding, such Participant Acquired Interest shall not be subject to or
burdened by the BOG Override. The Parties recognize and acknowledge that in
the event that BOG elects not to participate in the acquisition of a
Participant Acquired Interest and BOG subsequently desires to designate a
Project Area which would include all or part of such Participant Acquired
Interest within its boundaries, such Participant Acquired Interest would be an
Existing Property for purposes of Section 2.6 above and the Project Area would
be a Stephens Existing Property Project Area under the terms of Section 2.6
above.

ARTICLE VI.
3-D OPERATIONS WITHIN PROJECT AREAS

Section 6.1. Veritas Agreement. The Parties recognize that BOG
has entered into that certain Anadarko Basin Seismic Operations Agreement dated
effective as of February 15, 1996 with Veritas Geophysical, Ltd. ("Veritas"),
as amended, a copy of which is attached hereto as Exhibit D (hereinafter
referred to as the "Veritas Agreement"), providing for the conduct of 3-D
Operations within the AMI. Unless the Parties mutually agree otherwise, all
3-D Operations conducted by the Parties within the Project Areas designated
hereunder shall be conducted by Veritas, subject to the direction of BOG,
pursuant to the terms of the Veritas Agreement.

Section 6.2. Payments Due Under the Veritas Agreement.
Participant agrees to pay fifty percent (50%) of all of the payments that are
due under the terms of the Veritas Agreement, except with respect to the
payments that are due to Veritas pursuant to the terms of Sections 3.4 and 3.5
of the Veritas Agreement and payments which are related to 3-D Operations
conducted by Veritas for BOG within Excluded Existing BOG Project Areas,
Excluded Exempt Lands Project Areas, Excluded Future Third-Party Project Areas,
Excluded Stephens Existing Property Project Areas, or Excluded BOG Producing
Property Project Areas. With respect to the payments which are due to Veritas
pursuant to the terms of Sections 3.4 and 3.5 of the Veritas Agreement, in the
event that Participant participates in the acquisition of the oil and gas lease
or drilling or completion operation which results in such payment to Veritas
under Section 3.4 or 3.5 of the Veritas Agreement, Participant shall pay its
thirty-one and one quarter percent (31.25%) heads-up share of such payments;
provided, however, that in the event that Participant is the only Party that
participates in the acquisition of the oil and gas lease or drilling or
completion operation which results in the payment to Veritas under Section 3.4
or 3.5 of the Veritas Agreement, Participant shall be responsible to Veritas
for the full amount of such payment. BOG agrees to utilize appropriate and
commercially reasonable efforts to avoid incurring liability to Veritas under
Section 3.9 of the Veritas Agreement.

Section 6.3. Contribution Toward Payout. In the event that prior
to the end of the Exclusivity Period (as such term is defined in the Veritas
Agreement) under the Veritas Agreement Final Payout (as such term is defined in
the Veritas Agreement) has not occurred and only one of the Parties hereto
desires to contribute the cash payment toward such Final Payout as provided in
Section 4.2 of the Veritas Agreement, if such Party contributes consideration
toward Final Payout as provided in the Veritas Agreement, such Party shall own
all of the interest in the Program Data and all rights to receive any proceeds
resulting from the sale or licensing of the Program Data, subject only to the
other Party's right to continue to utilize such Program Data in its exploration
and development efforts as if such Final Payout amount had not been met.

Section 6.4. BOG Cooperation Regarding Veritas Agreement. BOG
agrees to fully cooperate with Participant to permit Participant to obtain from
Veritas ownership interests in the Program Data earned by Participant by reason
of Participant's contributions under this Agreement, including without
limitation the execution of any assignments or other documents required by
Veritas.

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<PAGE> 10

ARTICLE VII.
PARTICIPANT'S PAYMENT OF COSTS;
BOG RIGHT TO TERMINATION

Section 7.1. Participant's Reimbursement of Previously Incurred
Land Costs. Concurrent with its execution of this Agreement Participant shall
reimburse BOG for its thirty-one and one-quarter percent (31.25%) ownership
interest share of all Land Costs incurred prior to the effective date of this
Agreement.

Section 7.2. Participant Payment to BOG to be Utilized by BOG for
BOG's Future Exploration and/or Development Costs. Concurrent with its
execution of this Agreement Participant shall pay BOG eighty-eight thousand
seven hundred thirty-seven dollars ($88,737.00) which shall be used by BOG for
the payment of future exploration and development costs and expenses which
would have otherwise been charged to BOG under the terms of this Agreement and
the Geophysical Exploration Agreements executed by the Parties in accordance
with Section 3.2 above for the properties located within the Project Areas that
are designated pursuant to the terms of Section 3.1 above; provided, however,
that in the event that BOG does not, in its sole discretion, incur exploration
and/or development costs for its own account under this Agreement or the
Geophysical Exploration Agreements equaling or exceeding the total amounts paid
to it by Participant hereunder, BOG shall nonetheless retain the full amount
paid by Participant and shall have the right to utilize same in BOG's other
exploration and/or development efforts, whether or not relating to the AMI.

Section 7.3. Participant's Pre-Payment of Estimated Pre-Seismic
Land Costs. Concurrent with its execution of this Agreement Participant shall
deposit six hundred twenty-five thousand three hundred sixty-eight dollars
($625,368.00) into a segregated interest bearing account established by BOG.
The Parties agree that BOG shall utilize the funds deposited in such account
and all interest earned thereunder to pay for Participant's share of the Land
Costs that are incurred after the effective date of this Agreement pursuant to
the terms of Section 5.1 above and any Land Costs that are incurred within each
designated Project Area in acquiring any Seismic Permits, Options, Leases or
Farm-Ins that are acquired prior to the completion of final processing of the
Program Data (as defined in Section 3.3 of the form Geophysical Exploration
Agreement attached hereto as Exhibit C) within such Project Area. In the event
that any costs are incurred over and above the amount deposited in the
segregated account together with the interest earned thereunder, Participant
shall pay its fifty percent (50%) share of such costs in accordance with the
terms set forth in the Geophysical Exploration Agreement executed for the
applicable Project Area within which the Land Costs are incurred. BOG agrees
to provide Participant with monthly statements indicating the amount of Land
Costs incurred to date and the balance remaining in the BOG account.

Section 7.4. Participant Deposit Into Escrow Account. Concurrent
with its execution of this Agreement, Participant shall deposit two hundred
thousand dollars ($200,000.00) into the escrow account (the "Escrow Account")
established with Merchants National Bank / Fort Smith, Arkansas, pursuant to
the terms of that certain escrow agreement which is attached hereto as Exhibit
G (the "Escrow Agreement"). Participant shall pay all of the costs which are
incurred to Merchants National Bank / Fort Smith, Arkansas to establish,
service and maintain the Escrow Account. The funds deposited in the Escrow
Account together with all interest earned thereunder being referred to herein
as the "Escrow Account Balance." Subject to BOG's right to set-off all or any
portion of the Escrow Account Balance against amounts otherwise owing by
Participant as provided in Section 7.5 below, upon Participant's payment of the
Geophysical Program Costs incurred for the last Project Area designated
hereunder, the entire Escrow Account Balance shall be released to Participant.

Section 7.5. BOG's Rights Upon Participant Failure to Pre-Pay
Geophysical Program Costs. Anything to the contrary contained in this Article
VI notwithstanding, the Parties agree that in the event that Participant fails
to pre-pay its share of the estimated Geophysical Program Costs (as defined in
the form Geophysical Exploration Agreement which is attached hereto as Exhibit
C) for any Project Area in accordance with the terms set forth in Section 2.4
of the form Geophysical Exploration Agreement which is attached hereto as
Exhibit C and fails to cure such default within the period set forth in Section
2.5 of the form Geophysical Exploration Agreement

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<PAGE> 11

(hereinafter referred to as a "Pre-Payment Breach"), then BOG shall have the
right and option to receive and retain the Escrow Account Balance contained in
the Escrow Account created pursuant to the terms of Section 7.4 above to apply
such Escrow Account Balance toward any amounts for which Participant is in
default, and in addition to any other remedies which may be available to BOG at
law or in equity, BOG shall have the option, to be exercised in its sole
discretion, to terminate this Agreement as to any Project Areas not already
designated hereunder and as to the remainder of the AMI by giving Participant
written notice of such termination and upon such termination BOG; provided,
however that in the event of such a termination for a Pre-Payment Breach, the
provisions contained in Sections 8.1 and 8.2 and any other provisions that are
expressly stated to survive termination shall remain in full force and effect
and Participant shall continue to be subject to such terms and provisions for a
period of five (5) years from the effective date of this Agreement.

Section 7.6. Itemization of Expenditures In Billings. Each
invoice sent to Participant by BOG hereunder shall provide Participant with a
categorized listing of the items invoiced for payment. Such invoice will list
all Permits, Options, Leases and Farm-In costs, brokerage costs, and
Geophysical Program Costs (broken down into subcategories -- e.g. geophysical
acquisition charges, processing costs, workstation and plotter charges).

ARTICLE VIII.
PARTICIPANT'S ACTIVITY WITHIN THE AMI

Section 8.1. Participant Agreement Not to Conduct 3-D Operations
Within the AMI. Except as provided below in Section 8.2 with respect to
Third-Party 3-D Projects, Participant agrees that during the term of this
Agreement Participant shall not participate in any 3-D Operations within the
AMI other than its participation in the 3-D Operations which are contemplated
by the terms of this Agreement.

Section 8.2. Participant's Right to Participate in Third-Party 3-D
Operations. In the event that during the term of this Agreement Participant is
approached by a third-party with an opportunity to participate in a proposed
3-D operation to be conducted within the AMI, Participant shall have the right
to participate in such proposed 3-D operation; however, Participant hereby
agrees that BOG shall also have the right to participate in the 3-D operation
with sixty-eight and three-quarters percent (68.75%) of the interest in such
3-D operation which is offered to Participant upon the same terms which are
offered to Participant. Participant shall give BOG written notice of the terms
of the 3-D operation and BOG shall have fifteen (15) days from receipt of such
notice in which to make its election whether or not to participate in same.
The Parties recognize and agree that in the event that BOG elects to
participate in a third-party 3-D operation offered by Participant pursuant to
the terms of this Section 8.2, such 3-D operations shall not be conducted
pursuant to the terms of the Veritas Agreement.

ARTICLE IX.
RIGHT TO SAME TERMS AS SUBSEQUENT PARTICIPATION AGREEMENTS

Section 9.1. Defined Terms. As used in this Article IX, the
following terms shall have the following meanings:

(a) "Completion of Field Acquisition" means the date that field
seismic acquisition operations are completed for the 3-D Operations conducted
under the Veritas Agreement for the last Project Area hereunder.

(b) "Subsequent Participation Agreement" means an agreement
executed after the date hereof by and between BOG and any third party that is
not an Affiliate of BOG concerning (i) the third party's participation in
substantially all of the same Project Areas which are to be designated under
the terms of this Agreement within the AMI, (ii) the participation of such
third party in the 3-D Operations to be conducted within substantially all of
the Project Areas designated hereunder, (iii) the participation by BOG and such
third party in the acquisition and ownership of Seismic Permits, Options,
Leases and Farm-Ins obtained covering lands located within substantially all of
the Project Areas designated hereunder, and (iii) the participation by

Anadarko Basin Joint Participation Agreement

<PAGE> 12

BOG and such third party in the drilling of oil and gas wells within
substantially all of the Project Areas designated hereunder.

Section 9.2. Participant's Right to Same Terms Contained in a
Subsequent Participation Agreement. In the event that at any time prior to the
Completion of Field Acquisition BOG enters into a Subsequent Participation
Agreement covering substantially the entire AMI, Participant shall have the
right, but not the obligation, to request that BOG enter into a new agreement
with Participant covering the subject matter hereof, which agreement shall
contain the terms and conditions substantially identical, apart from the
quantum of participation interests, to all of those contained in the Subsequent
Participation Agreement; such new agreement shall be made in lieu of, and in
full substitution for, this Agreement. Participant hereby recognizes that such
right to elect to substitute a new agreement for this Agreement may be
exercised only once by Participant. Promptly following BOG's execution of a
Subsequent Participation Agreement BOG shall notify Participant of the
execution of such Subsequent Participation Agreement and provide Participant
with a copy of the executed Participation Agreement. Participant shall make
its election whether or not to enter into a substantially identical agreement
as set forth above within ten (10) days after Participant's receipt from BOG of
the copy of the executed Subsequent Participation Agreement; provided,
however, that in the event that Stephens fails to notify BOG of Stephens'
election within such ten (10) day period, Stephens shall be deemed to have
irrevocably elected not to enter into an agreement substantially identical to
the Subsequent Participation Agreement.

ARTICLE X.
MISCELLANEOUS

Section 10.1. Assignments. In the event that either Party hereto
assigns or conveys any of its rights or interests herein or in any properties
(whether real, personal, tangible or intangible, vested or contingent) that are
the subject of this Agreement, this Agreement shall be binding upon and run to
the benefit of such Party's assignee; provided, however, that the conveyance or
assignment instrument vesting such assignee with all or part of such interests
must expressly provide that the assignment or conveyance is made subject to the
terms and conditions contained in this Agreement. In addition, in any such
assignment or conveyance, the assignee shall expressly agree to assume and be
responsible for any liabilities, damages, obligations, covenants and agreements
arising from and after the date of such assignment or conveyance, in relation
to or otherwise out of the properties, rights and interests that are the
subject of this Agreement. Anything to the contrary contained in this Section
10.1 notwithstanding, for a period of five (5) years from the date of this
Agreement BOG cannot assign or convey its obligation to interpret the Program
Data resulting from the Geophysical Programs conducted within the Project
Areas; provided, however, that in the event of a merger involving BOG or the
acquisition of a substantial portion of BOG's assets, BOG may assign or convey
such obligations to the surviving or acquiring company.

Section 10.2. Notices. All notices and other communications
required or permitted under this Agreement shall be in writing, and unless
otherwise specifically provided, shall be delivered personally, or by mail,
facsimile, telecopier or delivery service, to the addresses set forth opposite
the signatures of the Parties below, and shall be considered delivered upon the
date of receipt. Each Party may specify its proper address or any other post
office address within the continental limits of the United States by giving
notice to other Parties, in the manner provided in this section, at least ten
(10) days prior to the effective date of such change of address.

Section 10.3. Merger. This Agreement supersedes any and all prior
and existing agreements, whether oral or in writing, between the Parties hereto
with respect to the subject matter hereof and contains all of the covenants and
agreements between the Parties with respect to the subject matter hereof. Each
Party acknowledges that no Party to this Agreement or anyone on their behalf
has made any representations, inducements, promises or agreements, orally or
otherwise, relating to the subject matter of this Agreement that are not
embodied herein.

Section 10.4. Governing Law. THIS AGREEMENT AND ALL MATTERS
PERTAINING THERETO, INCLUDING, BUT NOT LIMITED TO, MATTERS OF PERFORMANCE,
NON-PERFORMANCE, BREACH, REMEDIES, PROCEDURES,

Anadarko Basin Joint Participation Agreement

<PAGE> 13

RIGHTS, DUTIES, AND INTERPRETATIONS OR CONSTRUCTION, SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

Section 10.5. Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be binding upon the signing Party or
Parties thereto as fully as if all Parties had executed one instrument, and all
of such counterparts shall constitute one and the same instrument. If
counterparts of this Agreement are executed, the signatures of the Parties, as
affixed hereto, may be combined in and treated and given effect for all
purposes as a single instrument.

IN WITNESS WHEREOF this Agreement is executed by the Parties on the
dates set forth opposite their respective signatures below but is effective for
all purposes as of the date first set forth above.

Address: BRIGHAM OIL & GAS, L.P.,
5949 Sherry Lane, Suite 1616 by Brigham Exploration Company,
Dallas, Texas 75225 its Managing General Partner
(214) 360-9182
Fax: (214) 360-9825
Dated: 7/23/96 By: /s/ ANNE L. BRIGHAM
----------------- --------------------------------
Anne L. Brigham, Executive
Vice President

Address: STEPHENS PRODUCTION COMPANY
Stephens Building
623 Garrision Avenue
P.O. Box 2407
Fort Smith, Arkansas 72902-2407
Phone (501) 783-4191
Fax (501) 783-4195 By: /s/ WILLIAM S. WALKER
Dated: July 23, 1996 --------------------------------
--------------------- (name printed) William S. Waker
---------------------
Its: President
----------------------------

Anadarko Basin Joint Participation Agreement

<PAGE> 1
EXHIBIT 10.19

ANADARKO BASIN JOINT PARTICIPATION AGREEMENT

BY AND BETWEEN

VINTAGE PETROLEUM, INC.

AND

BRIGHAM OIL & GAS, L.P.

DATED MAY 1, 1996
<PAGE> 2
TABLE OF CONTENTS

ANADARKO BASIN JOINT PARTICIPATION AGREEMENT

ARTICLE I. RELATIONSHIP OF PARTIES 1
Section 1.1. No Partnership. 1
Section 1.2. Definition of Affiliate. 1

ARTICLE II. AREA OF MUTUAL INTEREST 1
Section 2.1. Creation of Area of Mutual Interest. 1
Section 2.2. Excluded Existing BOG Project Areas. 2
Section 2.3. Excluded Existing Vintage Project Areas. 2
Section 2.4. Project Areas Which BOG Elects to Treat as Exempt Lands. 2
Section 2.5. Project Areas Which are Treated as Terrain Excluded
Project Areas. 3
Section 2.6. Future Third-Party Generated Project Areas. 3
Section 2.7. Excluded BOG Producing Property Project Areas. 4
Section 2.8. Other Acquisition of Producing Properties. 5

ARTICLE III. ESTABLISHMENT OF PROJECT AREAS 5
Section 3.1. Project Area Development. 5
Section 3.2. Execution of Geophysical Exploration Agreement for Each
Project Area. 5

ARTICLE IV. PROJECT AREA BURDENS 6
Section 4.1. BOG Override. 6
Section 4.2. Other Third-Party Burdens. 6
Section 4.3. Lease Burdens. 6

ARTICLE V. OBTAINMENT OF SEISMIC PERMITS, OPTIONS, LEASES AND FARM-INS
PRIOR TO DESIGNATION OF PROJECT AREA 7
Section 5.1. BOG'S Acquisition of Land Interests Prior to Designation
of Project Area. 7
Section 5.2. Ownership and Assignment of Land Interests Acquired by
BOG but Not Included Within Designated Project Areas at
Termination of AMI. 7
Section 5.3. Participant's Acquisition of Land Interests Prior to
Designation of Project Area. 8
Section 5.4. Ownership and Assignment of Land Interest Acquired by
Participant Prior to Designation of a Project Area. 8

ARTICLE VI. 3-D OPERATIONS WITHIN PROJECT AREAS 9
Section 6.1. Veritas Agreement. 9
Section 6.2. Payments Due Under the Veritas Agreement. 9
Section 6.3. Contribution Toward Payout. 9
Section 6.4. BOG Cooperation Regarding Veritas Agreement. 9

ARTICLE VII. PARTICIPANT'S PAYMENT OF COSTS; BOG RIGHT TO TERMINATION 10
Section 7.1. Participant's Reimbursment of Previously Incurred Costs. 10
Section 7.2. Participant's Payment to BOG for BOG Future Costs. 10
Section 7.3. Participant's Pre-Payment of Estimated Pre-Seismic Land
Costs. 10
Section 7.4. Participant Deposit Into Escrow Account. 10
Section 7.5. BOG's Rights Upon Participant Failure to Pre-Pay
Geophysical Costs. 10
Section 7.6. Itemization of Expenditures In Billings. 11

ARTICLE VIII. PARTICIPANT'S ACTIVITY WITHIN THE AMI 11
Section 8.1. Participant Agreement Not to Conduct 3-D Within the AMI. 11
Section 8.2. Participant's Right to Participate in Third-Party
Operations. 11
Section 8.3. Participant's Right to Participate in 3-d Operations
Excluding Existing Vintage Project Areas. 11

ARTICLE IX. RIGHT TO SAME TERMS AS SUBSEQUENT PARTICIPANTS 11
Section 9.1. Defined Terms. 11
Section 9.2. Participant Right to Same Terms as Subsequent Participant. 12

ARTICLE X. MISCELLANEOUS 12
Section 10.1. Assignments. 12
Section 10.2. Notices. 12
Section 10.3. Merger. 12
Section 10.4. Governing Law. 13
Section 10.5. Counterparts. 13

<PAGE> 3
EXHIBITS
Exhibit A--AREA OF MUTUAL INTEREST
Exhibit B--EXCLUDED BOG PROJECT AREAS
Exhibit C--EXCLUDED VINTAGE PROJECT AREAS
Exhibit D--FORM GEOPHYSICAL EXPLORATION AGREEMENT
Exhibit A--Program Area
Exhibit B--Existing Options, Existing Leases and Existing
Farm-Ins
Exhibit C--Agreement as to Prospect Areas
Annex A-- Description of Prospect Areas
Exhibit D--Form Confidentiality Agreement
Exhibit E--Form of Assignment
Exhibit F--Form Override Assignment
Exhibit G--Form Joint Operating Agreement
Exhibit A--Contract Area Particulars
Exhibit C--Accounting Procedure (COPAS)
Exhibit D--Insurance
Exhibit E--Gas Balancing
Exhibit F--Memorandum of Joint Operating
Agreement
Exhibit H--Veritas Agreement
Exhibit A--Alliance Area
Exhibit B--Turnkey Amount and Other Seismic Costs
Exhibit C--Example Turnkey Charge Determinations
Exhibit D--Alternative Seismic Parameters
Exhibit E--Description of Equipment and Personnel
Exhibit F--General Terms and Provisions
Letter Amendment Dated June 10, 1996
Exhibit I--Land Status Reporting Form
Exhibit J--Form Participant Lease Option
Exhibit A--Form Oil & Gas Lease (Texas or Oklahoma
Form)
Exhibit B--Memorandum of Option Agreement
Exhibit K--Form Participant Lease Assignment Option
Exhibit A--Description of Oil & Gas Leases
Exhibit B--Form Assignment of Oil & Gas Leases
Annex I--Description of Oil & Gas Leases
Exhibit C--Memorandum of Lease Assignment Option
Exhibit A--Description of Oil & Gas
Leases
Exhibit L--Form Participant Partial Lease Assignment
Agreement
Exhibit A--Description of Oil & Gas Leases
Exhibit B--Form Partial Assignment of Oil & Gas
Leases
Exhibit A--Description of Oil & Gas
Leases
Exhibit M--Form Participant PUD Partial Lease Assignment
Agreement
Exhibit A--Description of Oil & Gas Leases
Exhibit B--Form Partial Assignment of Oil & Gas
Leases
Exhibit A--Description of Oil & Gas
Leases
Exhibit N--HBP PUD Leasehold Description
Exhibit E--VERITAS AGREEMENT
Exhibit F--FORM ASSIGNMENT
Exhibit G--COPIES OF OVERRIDE AGREEMENTS
Exhibit "G-1" MXC Override Agreement
Exhibit "G-2" Barclay I Override Agreement
Exhibit "G-3" Barclay II Override Agreement
Exhibit "G-4" Goudie Override Agreement
Exhibit H--ESCROW AGREEMENT
<PAGE> 4
ANADARKO BASIN JOINT PARTICIPATION AGREEMENT

This Anadarko Basin Joint Participation Agreement (this "Agreement")
is dated effective as of the 1st day of May, 1996, and is by and among VINTAGE
PETROLEUM, INC. ("Participant") and BRIGHAM OIL & GAS, L.P. ("BOG")
(Participant and BOG are sometimes referred to herein individually as "Party"
and collectively as "Parties");

WITNESSETH:

WHEREAS, the Parties desire to create an area of mutual interest
("AMI") for oil and/or gas exploration and development purposes; and

ARTICLE I.
RELATIONSHIP OF PARTIES

ARTICLE II.
AREA OF MUTUAL INTEREST

Section 2.1. Creation of Area of Mutual Interest. Subject to the
other terms which are set forth in this Article II, the Parties hereto agree to
establish the AMI encompassing all of the lands described in Exhibit A which is
attached hereto and incorporated herein for all purposes. The AMI established
hereunder shall remain in force and effect from the effective date hereof
<PAGE> 5
and continue until the earlier to occur of: (i) two (2) years from the
effective date hereof; (ii) such time as BOG has designated Project Areas (in
accordance with the provisions of Section 3.1 below) hereunder within which BOG
reasonably estimates that the Parties will conduct three-dimensional seismic
operations (hereinafter referred to as "3-D Operations") meeting the commitment
set forth in Article II of that certain Anadarko Basin Seismic Operations
Agreement dated effective as of February 15, 1996 with Veritas Geophysical,
Ltd. ("Veritas"), as amended, a copy of which is attached hereto as Exhibit E
(hereinafter referred to as the "Veritas Agreement"), after taking into
consideration any 3-D Operations which BOG may have conducted under the Veritas
Agreement within Excluded Existing BOG Project Areas, Excluded Existing Vintage
Project Areas, Excluded Exempt Lands Project Areas, Excluded Future Third-Party
Project Areas, or Excluded BOG Producing Property Project Areas. Without the
mutual agreement of both of the Parties hereto, no additional Project Areas
will be established under the terms of this Agreement following the termination
of the AMI as aforesaid. The Parties recognize that the termination of the AMI
hereunder will not act to terminate the Geophysical Exploration Agreements
executed by the Parties for previously designated Project Areas as set forth in
Section 3.2 below or the separate areas of mutual interest established under
such Geophysical Exploration Agreements.

Section 2.3. Excluded Existing Vintage Project Areas. The Parties
agree that all of the lands described in Exhibit C which is attached hereto and
incorporated herein (hereinafter referred to as the "Exhibit C Lands") shall be
deemed to be excluded from the AMI hereunder and all of the terms and
provisions of this Agreement (hereinafter referred to as "Excluded Existing
Vintage Project Areas").

Section 2.4. Project Areas Which BOG Elects to Treat as Exempt
Lands Under Veritas Agreement. The Parties recognize and acknowledge that
under the terms of Section 3.3 of the Veritas Agreement BOG has the right to
designate to Veritas in writing all or part of a Project Area for which BOG
shall pay one hundred five percent of the Turnkey Charge (as such term is
defined in the Veritas Agreement) and one hundred percent of all of the other
Seismic Acquisition Costs (as such term is defined in the Veritas Agreement) in
order to receive immediate ownership of all interests in the seismic data
covering such lands (the lands so designated being referred to in the Veritas
Agreement as "Excluded Lands," but being herein referred to as "Exempt Lands").
The Parties agree that in the event that BOG elects to designate an entire
Project Area as Exempt Lands under the Veritas Agreement (hereinafter referred
to as an "Exempt Lands Project Area"), Participant shall have the option to
participate, or not participate, in such Exempt Lands Project Area. However,
BOG agrees that it will not designate an entire Project Area as an Exempt Lands
Project Area unless BOG has entered into an agreement with a third party that
owns substantial mineral and/or leasehold interests within the Project Area and
such agreement provides that the third party is to have some ownership in
seismic data or contains confidentiality restrictions with respect to the
seismic data which are inconsistent with the confidentiality provisions set
forth in the Veritas Agreement. In the event that BOG designates, or intends
to designate, an entire Project Area as an Exempt Lands Project Area under the
Veritas Agreement, BOG shall notify Participant in writing of such designation,
or intended designation. Participant must then make its election in writing
within fifteen (15) days whether to participate, or not participate, in such
Exempt Lands Project Area; provided, however, that in the event that
Participant fails to notify BOG in writing of its election prior to the
expiration of such fifteen (15) day period, Participant shall be deemed to have
elected not to participate in the Exempt Lands Project Area. In the event that
Participant either elects, or is deemed to have elected, not to participate in
the Exempt Lands Project Area, such Exempt Lands Project Area shall be deemed
to be excluded from the AMI and all of the terms of this Agreement (hereinafter
referred to as an "Excluded Exempt Lands Project Area"). In the event that
Participant elects to participate in an Exempt Lands Project Area as provided
herein, anything to the contrary contained elsewhere herein or in the form
Geophysical Exploration Agreement which is attached hereto as Exhibit D
notwithstanding, Participant shall pay for fifty

Anadarko Basin Joint Participation Agreement
2
<PAGE> 6
percent (50%) of all of the costs, charges and expenses which are required to
be paid by BOG to Veritas under Section 3.3 of the Veritas Agreement for the
conduct of the 3-D Operations within such Exempt Lands Project Area.

Section 2.5. Project Areas Which are Treated as Terrain Excluded
Project Areas Under Veritas Agreement. The Parties recognize and acknowledge
that under the terms of Section 2.6 of the Veritas Agreement certain project
areas may be excluded from the Veritas Agreement in the event that Veritas has
notified BOG that there are problems with the terrain conditions for such
project area and BOG and Veritas fail to reach agreement on a Turnkey Charge
(as such term is defined in the Veritas Agreement) for the project area (such
project area being referred to in the Veritas Agreement and hereinafter in this
Agreement as a "Terrain Excluded Project Area"). The Parties agree that all
Terrain Excluded Project Areas shall be deemed to be excluded from the AMI and
all of the terms of this Agreement.

Section 2.6. Future Third-Party Generated Project Areas.

(a) If during the term of this Agreement a third-party offers BOG
the opportunity to participate in an oil and gas exploration project within the
AMI which (i) was not previously identified or generated by BOG, (ii) includes
the conduct of 3-D Operations and (iii) either (x) includes terms under which
BOG will acquire the interest in the project subject to a promote or carry of
any kind (in whole or in part and whether temporary or permanent) or (y)
includes terms under which BOG will acquire less than all of the working
interest and/or ownership interest (other than royalties or retained overriding
royalties) in the lands covered by the project (each such project which meets
all of (i), (ii) and (iii) above to be hereinafter referred to as "Future
Third-Party Project Areas") and BOG desires to participate in such Future
Third-Party Project Area, then BOG shall notify Participant of the terms of
such offer. Participant must notify BOG in writing within fifteen (15) days of
its receipt of such notice as to whether Participant shall participate in the
Future Third-Party Project Area; provided, however, that in the event that
Participant fails to notify BOG in writing of its election prior to the
expiration of such fifteen (15) day period, Participant shall be deemed to have
elected not to participate in the Future Third-Party Project Area. In the
event that Participant either elects, or is deemed to have elected, not to
participate in the Future Third-Party Project Area, such Future Third-Party
Project Area shall be deemed to be excluded from the AMI and all of the terms
of this Agreement (hereinafter referred to as an "Excluded Future Third-Party
Project Area") and BOG shall not be obligated to include Participant in any
exploration and/or development operations conducted within such Excluded Future
Third-Party Project Area.

(b) In the event that Participant elects to participate in a
Future Third-Party Project Area and BOG is not required to provide geophysical
expertise or support for the 3-D Operations to be conducted within the Future
Third-Party Project Area, Participant shall pay its heads-up share (being
31.25%) of all costs, expenses or consideration that BOG is required to pay
pursuant to the terms under which such Third-Party Project Area is offered. In
such event, Participant shall pay its heads-up share of all of such costs,
expenses and consideration on or before the date on which such payment is due
pursuant to the terms of participation which are set forth for the Future
Third-Party Project Area with the third-party.

Anadarko Basin Joint Participation Agreement
3
<PAGE> 7
(iii) above) pursuant to the terms under which such Third-Party Project Area is
offered. However, in the event that under the terms of the third-party offer
BOG is to be assigned less than all of the ownership interest (save and except
any overriding royalties and lessors' royalties) in the Future Third-Party
Project Area, then the amounts that Participant shall be required to pay under
(i) and (ii) above shall be reduced in the proportion that the ownership
interest being assigned to BOG bears to the total ownership interest in the
Future Third-Party Project Area. In the event that Participant elects to
participate in a Future Third-Party Project Area, the consideration set forth
in (i) and (ii) above shall be paid by Participant to BOG in accordance with
the terms that are set forth in the form Geophysical Exploration Agreement
which is attached hereto as Exhibit D and the consideration due under (iii)
above shall be paid by Participant to BOG before such payment is due to the
third-party or any other party pursuant to the terms of participation which are
set forth for the Future Third-Party Project Area with the third-party.

(e) The Parties expressly acknowledge and agree that in the event
that BOG identifies a potential Project Area and subsequently enters into an
agreement with a third-party to acquire all or part of such third-party's
interests within the Project Area (e.g. a "shoot to earn" type of arrangement),
despite the fact that BOG may be earning or acquiring less than all of such
third-party's interests in such Project Area or that BOG may have agreed to pay
a carry or promote to acquire all or part of such third-party's interest in the
Project Area, such Project Area shall not be deemed to be a Future Third-Party
Project Area for purposes of this Section 2.6, but rather shall be deemed to be
a normal Project Area for purposes of this Agreement.

Section 2.7. Excluded BOG Producing Property Project Areas. In
the event that after the effective date hereof BOG acquires or intends to
acquire an interest in producing wells together with their associated oil
and/or gas leases or mineral interests (herein referred to as "Producing
Properties") and intends to conduct 3-D Operations across such Producing
Properties, Participant shall have the election to participate or not
participate in such acquisition of Producing Properties and the Project Area
which includes such Producing Properties (hereinafter referred to as a "BOG
Producing Property Project Area"). Participant's election must be made with
respect to all of the Producing Properties acquired by BOG in a transaction, it
being understood and agreed that in the event that BOG enters into an agreement
to purchase Producing Properties which are made up of a number of different
wells and land interests, Participant shall not have the option to participate
in less than all of the properties that are the subject of the agreement. In
addition, the Parties recognize and agree that if Participant elects to
participate in Producing Properties, Participant must also participate in the
BOG Producing Property Project Area which covers those Producing Properties.
Participant shall make its election to participate or not participate in the
acquisition of such a Producing Property and its associated BOG Producing
Property Project Area by delivering its written election to BOG within thirty
(30) days of its receipt of a written notice from BOG setting forth the terms
upon which BOG intends to acquire the Producing Property. In the event that
Participant fails to deliver its written election to BOG's offices prior to the
expiration of such thirty (30) day period, Participant shall be deemed to have
elected not to participate in the acquisition of the Producing Property and the
associated BOG Producing Property Project Area. In the event that Participant
elects to participate in a BOG Producing Property, Participant shall only be
required to pay its thirty-one and one-quarter percent (31.25%) ownership
interest share of the costs that are paid directly to the sellers of such
Producing Property; however, Participant shall still be responsible for fifty
percent (50%) of all Land Costs (as such term is defined in Section 5.1 below)
related to such Producing Property which are incurred prior to the completion
of final processing of Program Data (as such phrase is defined in Section 3.5
of the form Geophysical Exploration Agreement which is attached hereto as
Exhibit D) covering the lands which are the subject of such Producing Property,
other than the costs that are paid directly to the seller and fifty percent
(50%) of all Geophysical Program Costs (as such term is defined in Section 2.4
of the form Geophysical Exploration Agreement which is attached hereto as
Exhibit D) incurred by the Parties within such BOG Producing Property Project
Area. In the event that the Participant

Anadarko Basin Joint Participation Agreement
4
<PAGE> 8
elects, or is deemed to have elected, not to participate in the acquisition of
a Producing Property and its associated BOG Producing Property Project Area
(the Producing Property Project Areas in which Participant elects or is deemed
to have elected not to participate being hereinafter referred to as the
"Excluded BOG Producing Property Project Areas") as aforesaid, the Excluded BOG
Producing Property Project Area shall be deemed to be excluded from the AMI
hereunder. The Parties recognize and agree that in the event a Project Area
has already been designated pursuant to the provisions of Section 3.1 and the
Parties have executed a Geophysical Exploration Agreement for such Project Area
as provided in Section 3.2 below, the terms and provisions of such Geophysical
Exploration Agreement shall govern any subsequent acquisition of Producing
Properties within that Project Area.

ARTICLE III.
ESTABLISHMENT OF PROJECT AREAS

Section 3.1. Project Area Development. The Parties recognize that
during the term of the AMI BOG will, utilizing reasonable criteria under the
circumstances as they exist at such time, delineate Project Areas over which
BOG is interested in conducting 3-D Operations in order to evaluate such
Project Areas. Each Project Area shall be a separate and discrete geographical
area. Once BOG has decided to pursue potential 3-D Operations within a Project
Area, BOG shall notify Participant in writing of the Project Area, designating
the Project Area by describing the geographical area included in the Project
Area, providing an estimate of the time frame for the conduct of 3-D Operations
within the Project Area and providing an estimate of the cost of such 3-D
Operations within the Project Area. BOG agrees to consult with Participant
with respect to the delineation of Project Areas which BOG has not delineated
prior to the Parties' execution of this Agreement, however, in the event that
the Parties are not in mutual agreement with respect to the delineation of any
Project Areas, BOG shall have the final say as to the delineation and
designation of the Project Areas. Furthermore, at any time prior to the
commencement of the 3-D Operations within a Project Area BOG shall have the
right to amend the geographical area covered by the Project Area by giving
Participant written notice of the amended description of the geographical area
covered by such Project Area. In addition, the Parties recognize that in
accordance with the terms of the form Geophysical Exploration Agreement which
is attached hereto as Exhibit D, following the conduct of a Geophysical Program
within a Project Area, the size of such Project Area may be reduced as set
forth in the form Geophysical Exploration Agreement. During the term of the
AMI hereunder, BOG shall not have the right to conduct 3-D Operations within
the AMI without Participant's participation as set forth in this Agreement,
other than within Excluded Existing BOG Project Areas, Excluded Existing
Vintage Project Areas, Excluded Exempt Lands Project Areas, Terrain Excluded
Project Areas, Excluded Future Third-Party Project Areas, and Excluded BOG
Producing Property Project Areas.

Anadarko Basin Joint Participation Agreement
5
<PAGE> 9
Geophysical Exploration Agreement; provided, however, that nothing contained
herein shall be construed to relieve any Party from liabilities or obligations
(whether monetary or otherwise) that accrued prior to such date with respect to
the subject Project Area. Anything to the contrary contained herein
notwithstanding, Participant recognizes that it does not have the right
hereunder to participate in any Project Areas established by BOG which cover
any part of either the Excluded Existing BOG Project Areas, Excluded Existing
Vintage Project Areas, Excluded Exempt Lands Project Areas, Terrain Excluded
Project Areas, Excluded Future Third-Party Project Areas, or Excluded BOG
Producing Property Project Areas.

ARTICLE IV.
PROJECT AREA BURDENS

Section 4.2. Other Third-Party Burdens. Participant expressly
recognizes and agrees that its interests (whether now owned or hereafter
acquired pursuant hereto) in portions of the AMI shall be burdened with
overriding royalties in favor of (i) MXC Exploration Company (hereinafter
referred to as "MXC") under and pursuant to the terms of that certain MXC
Exploration Company Consulting Agreement dated February 28, 1994 (a copy of
which is attached hereto as Exhibit G-1), by and between MXC and BOG (such
overriding royalty being hereinafter referred to as the "MXC Override"), (ii)
overriding royalties in favor of Barclay pursuant to the terms of that certain
Area of Mutual Interest Agreement dated August 1, 1994 (a copy of which is
attached hereto as Exhibit G-2), by and between BOG and Barclay (such
overriding royalty being hereinafter referred to as the "Barclay I Override"),
(iii) overriding royalties in favor of Barclay pursuant to the terms of that
certain Area of Mutual Interest Agreement dated April 1, 1996 (a copy of which
is attached hereto as Exhibit G-3), by and between BOG and Barclay (such
overriding royalty being hereinafter referred to as the "Barclay II Override")
and/or (iv) overriding royalties in favor of James E. Goudie (hereinafter
referred to as "Goudie") pursuant to the terms of that certain Area of Mutual
Interest Agreement dated October 1, 1994 (a copy of which is attached hereto as
Exhibit G-4), by and between BOG and Goudie (such overriding royalty being
hereinafter referred to as the "Goudie Override"). Participant also recognizes
and agrees that in its efforts to delineate Project Areas and obtain geological
consulting services within Project Areas, BOG may enter into agreements with
other third-party geologists and/or companies under which such third-parties
are due overriding royalties (hereinafter referred to as "Third-Party
Overrides") which shall proportionately burden both BOG's and Participant's
interests in all or parts of the AMI. Participant agrees that to the extent
that the MXC Override, the Barclay I Override, the Barclay II Override, the
Goudie Override or any other Third-Party Override burdens the applicable
Project Area, the Geophysical Exploration Agreement executed for such Project
Area shall provide that such Overrides proportionately burden the Parties'
Ownership Interests in the Project Area.

Section 4.3. Lease Burdens. Neither Party hereto shall burden or
encumber the other Party's legal or equitable interest in any Option, Lease or
Farm-In located within the AMI with any overriding royalty, production payment,
mortgage, security interest, or other burden except as provided in Sections 4.1
and 4.2 above, without the consent of the other Party hereto; provided,
however, that in its efforts to obtain an Option, Lease or Farm-In (as such
terms are defined in the form Geophysical Exploration Agreement which is
attached hereto as Exhibit D), a Party may grant or otherwise burden an Option,
Lease or Farm-In with a royalty, overriding royalty, production payment or
other similar burden in favor of a third party owning the rights to

Anadarko Basin Joint Participation Agreement
6
<PAGE> 10
the minerals underlying such Option, Lease or Farm-In or owning the rights to
oil and/or gas leases which are the subject to an Option or Farm-In (farmor,
mineral owner, assignor, lessee or lessor) in such Party's reasonable efforts
to obtain the Option, Lease or Farm-In.

ARTICLE V.
OBTAINMENT OF SEISMIC PERMITS, OPTIONS, LEASES
AND FARM-INS PRIOR TO DESIGNATION OF PROJECT AREAS

Section 5.1. BOG's Acquisition of Seismic Permits, Options, Leases
and Farm-Ins Prior to Designation of Project Areas. The Parties recognize that
BOG, in its efforts to target potential Project Areas, may have obtained and
may in the future obtain Seismic Permits, Options, Leases or Farm-Ins within
the AMI prior to designating a Project Area covering the acreage which is the
subject of such Seismic Permits, Options, Leases and/or Farm-Ins. Participant
agrees to pay its thirty-one and one-quarter percent (31.25%) ownership
interest share of all of the costs incurred prior to the effective date of this
Agreement in acquiring and maintaining Seismic Permits, Options, Leases and/or
Farm-Ins, including, without limitation, all brokerage costs and expenses,
option fees, permit fees, surface damage pre-payments, lease bonus payments,
delay rental payments, mineral or royalty acquisition payments, attorneys fees,
recording costs, abstract company fees and reproduction charges (hereinafter
referred to as "Land Costs"). Participant agrees to pay fifty percent (50%) of
all Land Costs reasonably and prudently incurred (in light of the circumstances
then in existence) after the effective date of this Agreement in acquiring and
maintaining Seismic Permits, Options, Leases and/or Farm-Ins prior to the
Parties execution of a Geophysical Exploration Agreement for a Project Area
within which the lands covered by such Seismic Permits, Options, Leases and/or
Farm-Ins are located. However, anything to the contrary contained above
notwithstanding, in the event that more than a total of two million two hundred
thousand dollars ($2,200,000.00) of Land Costs are incurred (to the 8/8ths) in
acquiring and maintaining Seismic Permits, Options, Leases and/or Farm-Ins
within the AMI prior to the completion of final processing of Program Data (as
such phrase is defined in Section 3.5 of the form Geophysical Exploration
Agreement which is attached hereto as Exhibit D) covering the lands which are
the subject of such Seismic Permits, Options, Leases and/or Farm-Ins (such
$2,200,000.00 amount of total pre-completion of final processing of Program
Data Land Costs being hereinafter referred to as the "Pre-Seismic Land Cost
Promote Cap"), Participant shall only be required to pay for its thirty-one and
one-quarter percent (31.25%) ownership interest share of all Land Costs that
are incurred within the AMI after such time as the Pre-Seismic Land Cost
Promote Cap has been exceeded. In addition, anything to the contrary contained
above notwithstanding, the Parties agree that in the event that a Producing
Property is acquired by BOG prior to the designation of the Project Area
covering same and Participant elects to participate in such Producing Property
as set forth in Section 2.7 above, Participant shall only be required to pay
its thirty-one and one-quarter percent (31.25%) ownership interest share of the
costs that are paid directly to the sellers of such Producing Property;
however, Participant shall still be responsible for fifty percent (50%) of all
Land Costs related to such Producing Property other than the costs that are
paid directly to the seller and fifty percent (50%) of all Geophysical Program
Costs (as such term is defined in Section 2.4 of the form Geophysical
Exploration Agreement which is attached hereto as Exhibit D) incurred by the
Parties within such Project Area. However, the costs that are paid directly to
sellers of Producing Properties shall not be included in the calculation of the
total Land Costs incurred for purposes of determining the Pre-Seismic Land Cost
Promote Cap.

Section 5.2. Ownership and Assignment of Seismic Permits, Options,
Leases and Farm-Ins Acquired by BOG but Not Included Within Designated Project
Areas at the Termination of the AMI. The Parties agree that in the event that
any Seismic Permits, Options, Leases or Farm-Ins have been acquired by BOG
within the AMI (as modified as provided in Sections 2.2, 2.3, 2.4, 2.5, 2.6,
2.7, and 2.8) prior to the effective date hereof or are acquired by BOG within
the AMI during the term hereof, BOG shall own an undivided sixty-eight and
three-quarters percent (68.75%) and Participant shall own an undivided
thirty-one and one-quarter percent (31.25%) interest in such Seismic Permits,
Options, Leases or Farm-Ins; provided, however, that, except as provided below
in this Section 5.2, legal title to such Seismic Permits, Options, Leases and
Farm-Ins shall not be assigned to Participant until after the applicable
Seismic Permit, Option, Lease or Farm-In has been included within a designated
Project Area and the Geophysical Exploration Agreement executed for such
Project Area shall then govern the

Anadarko Basin Joint Participation Agreement
7
<PAGE> 11
terms of the assignment of legal title to the Parties. Anything to the
contrary contained above notwithstanding, the Parties agree that in the event
that any Seismic Permits, Options, Leases or Farm-Ins are not included within a
designated Project Area prior to the expiration of the term of this Agreement
and Participant has paid its share of all Land Costs associated with such
Seismic Permits, Options, Leases or Farm-Ins, promptly following the expiration
of the term of this Agreement BOG shall assign and convey to Participant it's
undivided thirty-one and one-quarter percent (31.25%) ownership interest in
such Seismic Permits, Options, Leases and/or Farm-Ins utilizing the general
form of assignment which is attached hereto as Exhibit D.

Section 5.4. Ownership and Assignment of Seismic Permits, Options,
Leases and Farm-Ins Acquired by Participant Prior to Designation of a Project
Area. The Parties agree that in the event that BOG elects to participate in a
Participant Acquired Interest as set forth in Section 5.3 above, BOG shall own
an undivided sixty-eight and three-quarters percent (68.75%) and Participant
shall own an undivided thirty-one and one-quarter percent (31.25%) interest in
such Participant Acquired Interest; provided, however, that, except as provided
below in this Section 5.4, legal title to such Participant Acquired Interest
shall not be assigned to BOG until after the applicable Participant Acquired
Interest has been included within a designated Project Area and the Geophysical
Exploration Agreement executed for such Project Area shall then govern the
terms of the assignment of legal title to the Parties. Anything to the
contrary contained above notwithstanding, the Parties agree that in the event
that any Participant Acquired Interests are not included within a designated
Project Area prior to the expiration of the term of this Agreement and BOG has
elected to participate in such Participant Acquired Interest and has

Anadarko Basin Joint Participation Agreement
8
<PAGE> 12
paid its share of all Land Costs associated with such Participant Acquired
Interest as set forth in Section 5.3 above, promptly following the expiration
of the term of this Agreement Participant shall assign and convey to BOG it's
undivided sixty-eight and three-quarters percent (68.75%) ownership interest in
such Participant Acquired Interest utilizing the general form of assignment
which is attached hereto as Exhibit F. In the event that BOG elects not to
participate in a Participant Acquired Interest, such Participant Acquired
Interest shall be owned solely by Participant and anything to the contrary
contained in this Agreement notwithstanding, such Participant Acquired Interest
shall not be subject to or burdened by the BOG Override. The Parties recognize
and acknowledge that in the event that BOG elects not to participate in the
acquisition of a Participant Acquired Interest and BOG subsequently designates
a Project Area which would include all or part of such Participant Acquired
Interest within its boundaries, such Participant Acquired Interest would be
subject to the terms and provisions of Section 3.3 of the Geophysical
Exploration Agreement (in the form attached hereto as Exhibit D) executed for
such Project Area.

ARTICLE VI.
3-D OPERATIONS WITHIN PROJECT AREAS

Section 6.1. Veritas Agreement. The Parties recognize that BOG
has entered into that certain Anadarko Basin Seismic Operations Agreement dated
effective as of February 15, 1996 with Veritas Geophysical, Ltd. ("Veritas"),
as amended, a copy of which is attached hereto as Exhibit E (hereinafter
referred to as the "Veritas Agreement"), providing for the conduct of 3-D
Operations within the AMI. Unless the Parties mutually agree otherwise, all
3-D Operations conducted by the Parties within the Project Areas designated
hereunder shall be conducted by Veritas, subject to the direction of BOG,
pursuant to the terms of the Veritas Agreement.

Section 6.2. Payments Due Under the Veritas Agreement.
Participant agrees to pay fifty percent (50%) of all of the payments that are
due under the terms of the Veritas Agreement, except with respect to the
payments that are due to Veritas pursuant to the terms of Sections 3.4 and 3.5
of the Veritas Agreement and payments which are related to 3-D Operations
conducted by Veritas for BOG within Excluded Existing BOG Project Areas,
Excluded Existing Vintage Project Areas, Excluded Exempt Lands Project Areas,
Excluded Future Third-Party Project Areas, or Excluded BOG Producing Property
Project Areas. With respect to the payments which are due to Veritas pursuant
to the terms of Sections 3.4 and 3.5 of the Veritas Agreement, in the event
that Participant participates in the acquisition of the oil and gas lease or
drilling or completion operation which results in such payment to Veritas under
Section 3.4 or 3.5 of the Veritas Agreement, Participant shall pay its
thirty-one and one quarter percent (31.25%) heads-up share of such payments;
provided, however, that in the event that Participant is the only Party that
participates in the acquisition of the oil and gas lease or drilling or
completion operation which results in the payment to Veritas under Section 3.4
or 3.5 of the Veritas Agreement, Participant shall be responsible to Veritas
for the full amount of such payment. BOG agrees to utilize appropriate and
commercially reasonable efforts to avoid incurring liability to Veritas under
Section 3.9 of the Veritas Agreement.

Anadarko Basin Joint Participation Agreement
9
<PAGE> 13
ARTICLE VII.
PARTICIPANT'S PAYMENT OF COSTS;
BOG RIGHT TO TERMINATION

Section 7.2. Participant Payment to BOG to be Utilized by BOG for
BOG's Future Exploration and/or Development Costs. Concurrent with its
execution of this Agreement Participant shall pay BOG two hundred forty
thousand three hundred ninety-five dollars and sixty-two cents ($240,395.62)
which shall be used by BOG for the payment of future exploration and
development costs and expenses which would have otherwise been charged to BOG
under the terms of this Agreement and the Geophysical Exploration Agreements
executed by the Parties in accordance with Section 3.2 above for the properties
located within the Project Areas that are designated pursuant to the terms of
Section 3.1 above; provided, however, that in the event that BOG does not, in
its sole discretion, incur exploration and/or development costs for its own
account under this Agreement or the Geophysical Exploration Agreements equaling
or exceeding the total amounts paid to it by Participant hereunder, BOG shall
nonetheless retain the full amount paid by Participant and shall have the right
to utilize same in BOG's other exploration and/or development efforts, whether
or not relating to the AMI.

Section 7.3. Participant's Pre-Payment of Estimated Pre-Seismic
Land Costs. Concurrent with its execution of this Agreement Participant shall
deposit three hundred fifty-eight thousand nine hundred forty-five dollars
($358,945.00) into a segregated interest bearing account established by BOG.
The Parties agree that BOG shall utilize the funds deposited in such account
and all interest earned thereunder to pay for Participant's share of the Land
Costs that are incurred after the effective date of this Agreement pursuant to
the terms of Section 5.1 above and any Land Costs that are incurred within each
designated Project Area in acquiring any Seismic Permits, Options, Leases or
Farm-Ins that are acquired prior to the completion of final processing of the
Program Data (as defined in Section 3.3 of the form Geophysical Exploration
Agreement attached hereto as Exhibit D) within such Project Area. In the event
that any costs are incurred over and above the amount deposited in the
segregated account together with the interest earned thereunder, Participant
shall pay its fifty percent (50%) share of such costs in accordance with the
terms set forth in the Geophysical Exploration Agreement executed for the
applicable Project Area within which the Land Costs are incurred. BOG agrees
to provide Participant with monthly statements indicating the amount of Land
Costs incurred to date and the balance remaining in the BOG account.

Section 7.4. Participant Deposit Into Escrow Account. Concurrent
with its execution of this Agreement, Participant shall deposit two hundred
thousand dollars ($200,000.00) into the escrow account (the "Escrow Account")
established with Bank One / Dallas, Texas, pursuant to the terms of that
certain escrow agreement which is attached hereto as Exhibit H (the "Escrow
Agreement"). Participant shall pay all of the costs which are incurred to Bank
One / Dallas, Texas to establish, service and maintain the Escrow Account. The
funds deposited in the Escrow Account together with all interest earned
thereunder being referred to herein as the "Escrow Account Balance." Subject
to BOG's right to set-off all or any portion of the Escrow Account Balance
against amounts otherwise owing by Participant as provided in Section 7.5
below, upon Participant's payment of the Geophysical Program Costs incurred for
the last Project Area designated hereunder, the entire Escrow Account Balance
shall be released to Participant.

Section 7.5. BOG's Rights Upon Participant Failure to Pre-Pay
Geophysical Program Costs. Anything to the contrary contained in this Article
VI notwithstanding, the Parties agree that in the event that Participant fails
to pre-pay its share of the estimated Geophysical Program Costs (as defined in
the form Geophysical Exploration Agreement which is attached hereto as Exhibit
D) for any Project Area in accordance with the terms set forth in Section 2.4
of the form Geophysical Exploration Agreement which is attached hereto as
Exhibit D and fails to cure such default within the period set forth in Section
2.5 of the form Geophysical Exploration Agreement (hereinafter referred to as a
"Pre-Payment Breach"), then BOG shall have the right and option to

Anadarko Basin Joint Participation Agreement
10
<PAGE> 14
receive and retain the Escrow Account Balance contained in the Escrow Account
created pursuant to the terms of Section 7.4 above to apply such Escrow Account
Balance toward any amounts for which Participant is in default, and in addition
to any other remedies which may be available to BOG at law or in equity, BOG
shall have the option, to be exercised in its sole discretion, to terminate
this Agreement as to any Project Areas not already designated hereunder and as
to the remainder of the AMI by giving Participant written notice of such
termination and upon such termination BOG; provided, however that in the event
of such a termination for a Pre-Payment Breach, the provisions contained in
Sections 8.1 and 8.2 and any other provisions that are expressly stated to
survive termination shall remain in full force and effect and Participant shall
continue to be subject to such terms and provisions for a period of five (5)
years from the effective date of this Agreement.

ARTICLE VIII.
PARTICIPANT'S ACTIVITY WITHIN THE AMI

Section 8.1. Participant Agreement Not to Conduct 3-D Operations
Within the AMI. Except as provided below in Section 8.2 with respect to
Third-Party 3-D Projects and Section 8.3 with respect to Excluded Existing
Vintage Project Areas, Participant agrees that during the term of this
Agreement Participant shall not participate in any 3-D Operations within the
AMI other than its participation in the 3-D Operations which are contemplated
by the terms of this Agreement.

Section 8.3. Participant's Right to Participate in 3-D Operations
Within Excluded Existing Vintage Project Areas. Nothing contained in this
Agreement shall be construed to prevent Vintage from participating in the
conduct of 3-D Operations within the Excluded Existing Vintage Project Areas.

ARTICLE IX.
RIGHT TO SAME TERMS AS SUBSEQUENT PARTICIPATION AGREEMENTS

Section 9.1. Defined Terms. As used in this Article IX, the
following terms shall have the following meanings:

Anadarko Basin Joint Participation Agreement
11
<PAGE> 15
party in the 3-D Operations to be conducted within substantially all of the
Project Areas designated hereunder, (iii) the participation by BOG and such
third party in the acquisition and ownership of Seismic Permits, Options,
Leases and Farm-Ins obtained covering lands located within substantially all of
the Project Areas designated hereunder, and (iii) the participation by BOG and
such third party in the drilling of oil and gas wells within substantially all
of the Project Areas designated hereunder.

Section 9.2. Participant's Right to Same Terms Contained in a
Subsequent Participation Agreement. In the event that at any time prior to the
Completion of Field Acquisition BOG enters into a Subsequent Participation
Agreement covering substantially the entire AMI, Participant shall have the
right, but not the obligation, to request that BOG enter into a new agreement
with Participant covering the subject matter hereof, which agreement shall
contain the terms and conditions substantially identical, apart from the
quantum of participation interests, to all of those contained in the Subsequent
Participation Agreement; such new agreement shall be made in lieu of, and in
full substitution for, this Agreement. Participant hereby recognizes that such
right to elect to substitute a new agreement for this Agreement may be
exercised only once by Participant. Promptly following BOG's execution of a
Subsequent Participation Agreement BOG shall notify Participant of the
execution of such Subsequent Participation Agreement and provide Participant
with a copy of the executed Participation Agreement. Participant shall make
its election whether or not to enter into a substantially identical agreement
as set forth above within ten (10) days after Participant's receipt from BOG of
the copy of the executed Subsequent Participation Agreement; provided,
however, that in the event that Vintage fails to notify BOG of Vintage'
election within such ten (10) day period, Vintage shall be deemed to have
irrevocably elected not to enter into an agreement substantially identical to
the Subsequent Participation Agreement.

ARTICLE X.
MISCELLANEOUS

Anadarko Basin Joint Participation Agreement
12
<PAGE> 16
Section 10.4. Governing Law. THIS AGREEMENT AND ALL MATTERS
PERTAINING THERETO, INCLUDING, BUT NOT LIMITED TO, MATTERS OF PERFORMANCE,
NON-PERFORMANCE, BREACH, REMEDIES, PROCEDURES, RIGHTS, DUTIES, AND
INTERPRETATIONS OR CONSTRUCTION, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
TEXAS, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

IN WITNESS WHEREOF this Agreement is executed by the Parties on the
dates set forth opposite their respective signatures below but is effective for
all purposes as of the date first set forth above.

<TABLE>
<S> <C>
Address: BRIGHAM OIL & GAS, L.P.,
5949 Sherry Lane, Suite 1616 by Brigham Exploration Company,
Dallas, Texas 75225 its Managing General Partner
(214) 360-9182
Fax: (214) 360-9825

Dated: July 23, 1996 By: /s/ ANNE L. BRIGHAM
------------------------ ------------------------------
Anne L. Brigham,
Executive Vice President

Address: VINTAGE PETROLEUM, INC.
4200 One Williams
Tulsa, Oklahoma 74172
Phone (918) 588-____
Fax (918) 588-9171 By: /s/ WILLIAMS WALKER
----------------------------
Dated: July 23, 1996 (Name printed) Williams Walker
------------------------- -----------------
Its: President
--------------------------
</TABLE>

Anadarko Basin Joint Participation Agreement

<PAGE> 1
EXHIBIT 10.20

THIS AGREEMENT ENTERED INTO AND EXECUTED IS EFFECTIVE
UPON THE DATE OF THE LAST SIGNATURE HEREIN BELOW:

BETWEEN

VERITAS SEISMIC (1987) LTD., (HEREINAFTER REFERRED TO AS "VERITAS")
CALGARY, ALBERTA, CANADA

AND

BRIGHAM OIL AND GAS, L.P. (HEREINAFTER REFERRED TO AS "BOG")
DALLAS, TEXAS, U.S.A.

The following Appendixes constitute this agreement:

APPENDIX "I" - ON-SITE SAGE PROCESSING SYSTEM/TERMS AND CONDITIONS
APPENDIX "A" - DELIVERABLES
APPENDIX "B" - 3D PROCESSING RUN STREAM
APPENDIX "C" - ADDITIONAL PROCESSING COSTS
APPENDIX "D" - INSURANCE CERTIFICATE

Both parties agree to give 30 days written cancellation notice to terminate
agreement for reasons other than those contained herein. If a breach in the
terms of the agreement is not rectified within 72 hours after notification,
then the other party has the right to immediate termination of agreement.

WE HEREBY AGREE to the Terms and Conditions as outlined.

VERITAS SEISMIC (1987) LTD. BRIGHAM OIL & GAS, L.P.

/s/ T. L. Grundecki /s/ Anne L. Brigham
- --------------------------- -----------------------------
(Authorized Signature) (Authorized Signature)

Senior Vice President Vice President
- --------------------------- -----------------------------
(Title) (Title)

7/15/93 07/20/93
- --------------------------- -----------------------------
(Date) (Date)
<PAGE> 2
APPENDIX "I"

GENERAL CONDITIONS:

Veritas is the owner of all rights, title and interest in the computer
hardware/software system more specifically described as the SAGE 3D Processing
System. Veritas will maintain insurance coverage to insure the equipment
located at BOG site.

BOG commits to a minimum of $ U.S. $50,000.00 per month of 3D processing and
Veritas commits to provide a dedicated internal SAGE Processing System to
process a minimum of this volume per month. (Changes to this commitment will be
administered by the Veritas Dallas area manager and BOG's representative).

The parties hereto agree that if the SAGE Processing System remains idle for a
period of two weeks, then Veritas will have the option after giving BOG 24
hours notice to remove the system from BOG's offices. Such a removal will
automatically terminate this agreement. The parties also agree that if it
becomes inconvenient for BOG to continue to provide office space to Veritas or
if BOG becomes dissatisfied with Veritas' work product, Veritas will, after
receiving 30 days notice remove the system from BOG's offices. Such a removal
will automatically terminate this agreement.

Veritas agrees that it is an independent contractor and that the staff
operating the processing system are Veritas employees and Veritas accepts sole
responsibility for complying with all state and federal withholding taxes and
other employment laws. (Veritas Calgary employees working at the BOG site have
existing and maintain Workman's Compensation Insurance).

INSURANCE

Included in Appendix "D" is an Insurance Certificate from Johnson & Higgins
outlining our insurance coverage.

BOG will be instated into Veritas' insurance coverage, only with regards to
operations performed by or on behalf of Veritas for BOG.

TURNAROUND:

Each "3D Project" will be in the range of 2 to 60 square miles.
Sequential turnaround time for processing 3D projects based on size will be as
follows:

10 Sq. Mi. 3D - 2.0 weeks
20 Sq. Mi. 3D - 3.0 weeks
30 Sq. Mi. 3D - 3.0 - 4.0 weeks
60 Sq. Mi. 3D - 4.0 - 6.0 weeks

The deliverables for each 3D project are listed in Appendix "A."
The 3D Processing Run Stream is outlined in Appendix "B"
Additional Processing Costs are outlined in Appendix "C"

2
<PAGE> 3

PRICE:

BOG - Dallas Site

Price for processing according to the processing run stream of Appendix "B."
- ------------------------------------------U.S. $14.00 - Price based on 480
Trace Records An increase in traces per record will increase the price by 5%
per 100 additional traces per record.

All processing performed at BOG Dallas facility will be invoiced at the above
price.

Backup / Additional Processing

If the BOG dedicated SAGE installation is backlogged or the work cannot be
completed in a timely manner due to any circumstance (technical difficulties or
lack of capacity) then the work will be sent to Veritas Bedford or Veritas
Calgary at the following quoted price.

Veritas Bedford --------------- 0% price reduction
Veritas Calgary --------------- -10% price reduction

Veritas will submit invoices as each 3D project is complete as per Deliverables
in Appendix "A".

- If projects are suspended by BOG, they will be billed to the
work stage completed at point of suspension.

- If larger 3Ds are processed in segments with full deliverables
for that segment, they will be billed for that segment.

Additional charges for Optional Processing - as per Appendix "C".

Terms of Payment is Net 45 Days from date of Invoice.

3
<PAGE> 4
Pricing will be re-evaluated on a 6-month basis to keep current with market
trends.

OFFICE REQUIREMENTS

BOG will provide Veritas with the following at no additional charge:

1). 350 sq. ft. of dedicated office space
2). 2 - 15 amp. Dedicated circuits of power.
3). 1 - Telephone and extension line for internal operation.
4). 24-Hour, 7 days per week access to office for Veritas staff.
5). Building air-conditioning maximized to building environment.
6). Access to water and drain for external air-conditioner.
7). 2 - six foot folding tables

Veritas will supply the following:

1). 1 - Dedicated telephone line for software/hardware support, long
distance and business calls.

2). Additional room air-conditioner will be supplied by Veritas if
required.

BOG will use their best efforts to approve parameters and run flows to expedite
the processing and understand that additional testing and analysis will affect
the completion times and the number of records the center can process in a
month.

Veritas understands the importance of achieving a quality product and will do
testing to improve the product where necessary.

The spirit of this agreement is to "work together" to provide a quality product
in an acceptable time frame. Veritas will work in cooperation with BOG to
achieve that result.

VERITAS SEISMIC (1987) LTD. BRIGHAM OIL & GAS, L.P.

/s/ T. L. Grundecki /s/ Anne L. Brigham
- --------------------------- -----------------------------
(Authorized Signature) (Authorized Signature)

4
<PAGE> 5
APPENDIX "A"

DELIVERABLES

1). Thermal Paper Display of Bin Map

2). SEG P1 Tape of Bin Centres

3). Final Fold Map of Zone of Interest

4). SEG-Y Format Exabyte Cartridge of Structure Stack and Migration

5). Thermal 11-inch Paper Plots of every 5th Inline Intermediate Stack
Section

6). Thermal Plots of Common Offset Stacks.

7). Thermal Plots of every 5th Inline and Cross-Line Section of Final
Structure Stack, One Polarity (selected by Brigham Oil & Gas)

8). Thermal Plots of every 5th Inline and Cross-line section of Migrated
Stacks, One Polarity (selected by Brigham Oil & Gas)

9). Velocity Table Display

10). Processing History Display

11). Velocity Confirmation Display including:

- Semblance plots
- Interval velocity plots
- Super Gathers

12). Thermal Paper Plots of the following Map Displays:

- Bin Azimuths
- Bin Offset Plots
- Elevation Statics (or Elevation Displays)
- Displays of Stacking Velocities at 3 Key Times
- Displays of Migration Velocities at 3 Key Times 1

VERITAS SEISMIC (1987) LTD. BRIGHAM OIL & GAS, L.P.

/s/ T. L. Grundecki /s/ Anne L. Brigham
- --------------------------- -----------------------------
(Authorized Signature) (Authorized Signature)

5
<PAGE> 6
APPENDIX "B"

3D PROCESSING RUN STREAM

The 3D Processing Stream includes One Pass 3D Migration, 3D Surface Consistent
and Trim Statics, Quality Control of the processing and testing for optimum
parameter selection, not to exceed 10% of total run time.

1). Demultiplex, Exponential Gain Function.
2). Display selected Shot Records for Quality Control and Edit.
3). Geometry Files with X-Y Coordinates for all Shots and Stations.
4). Plot Surface and Sub-surface Maps on Paper for Quality Control.
5). First Break Batch Picking to check Geometry.
6). Rephasing or Dephasing of Geophones (Optional).
7). Minimum Phase Correction to Vibroseis Sweep (Optional).
8). Deconvolution and Bandpass Filter Analysis.
9). Application of Deconvolution (Surface Consistent Deconvolution).
10). Residual Amplitude Analysis and Application.
11). Structure Statics Application.
12). Velocity Analysis.
13). Surface Consistent Statics (3D Solution).
14). Display Selected Shot Records with NMO for Quality Control.
15). Preliminary Stack and Display (every 5th Line).
16). Velocity Analysis ( every 1/2 mile).
17). Normal Moveout with Spatial (3D) Interpolation Between Analysis Control
Points.
18). First Break Mutes.
19). Common Depth Point Trim Statics (3D Solution).
20). Stack and Final Super Gathers (with Final NMO and Mute)
21). Bandpass Filter Analysis.
22). Bandpass Filter.
23). Amplitude Equalization.
24). Migration - One Pass 3D Finite Difference.
25). SEGY Tape of Unfiltered Structure Stack, Filtered Structure Stack and
Migrated Stack.

VERITAS SEISMIC (1987) LTD. BRIGHAM OIL & GAS, L.P.

/s/ T. L. Grundecki /s/ Anne L. Brigham
- --------------------------- -----------------------------
(Authorized Signature) (Authorized Signature)

6
<PAGE> 7
APPENDIX "C"

ADDITIONAL PROCESSING COSTS

<TABLE>
<S> <C> <C>
1). Radon Transform Multiple or Noise Attenuation $ 3.00/VP
(Shot Mode)

2). Radon Transform Multiple or Noise Attenuation $ 4.00/VP
(Gather Mode)

3). Post-stack Radon Noise Elimination (2-Pass) $ 0.10/CDP

4). F-X Deconvolution (2 Pass) $ 0.10/CDP

5). Data Slice Film Displays (approx. 500 ms. Window) $ 0.06/CDP/Polarity

6). Full Length Film Displays $ 0.15/CDP/Polarity

7). Dip Moveout (Prestack Partial Migration) $ 3.00/Trace Record
(Includes updating Velocities after DMO)

8). First Break Picking and Interpretation using a $ 2.00/480 Trace Record
Generalized Linear Inversion Algorithm (3D Solution)

9). Spectral Whitening Pre-stack $ 2.00/480 Trace Record
Post-stack Spectral Whitening (Dcon) $ 0.10/CDP

10). Additional SEG-Y Tapes $ 50.00/Tape

11). Additional Map Displays $ 125.00/Map

12). Additional Displays of Stacks to Paper $ 0.02/CDP/Polarity

</TABLE>

ALL PRICES ARE IN U.S. DOLLARS

VERITAS SEISMIC (1987) LTD. BRIGHAM OIL & GAS, L.P.

/s/ T. L. Grundecki /s/ Anne L. Brigham
- --------------------------- -----------------------------
(Authorized Signature) (Authorized Signature)

<PAGE> 1
EXHIBIT 10.20.1

VERITAS SEISMIC
860 W. Airport Freeway
Suite 509 Telephone: (817) 355-0087
Hurst, Texas 76054 Fax: (817) 498-1256
"QUALITY AND SERVICE . . . OUR COMMITMENT"
________________________________________________________________________________

November 3, 1994

Brigham Oil & Gas
5949 Sherry Lane # 1616
Dallas, Texas 75225

Attn: Bud Brigham

Dear Mr. Brigham

After carefully analyzing pricing structures for data processing over the last
four months there appears to be downward pressure on processing costs. With
this in mind I think it prudent to keep our relationship as close to market
conditions as possible. I have decided to lower your costs for processing to
$12.50 / 480 trace record down from the agreed upon contract price of $14.00 /
480 trace record.

As of November 1, 1994 any new data awarded to Veritas Seismic will be billed
at the new rate. This price excludes all current in-house work.

All other aspects of our agreement remain unaffected.

Sincerely,

/s/ Rob Yorke

Rob Yorke
Veritas Seismic

<PAGE> 1
EXHIBIT 10.21

AGREEMENT AND ASSIGNMENT OF
INTEREST IN WEST BRADLEY PROJECT
GRADY COUNTY, OKLAHOMA

This Agreement and Assignment of Interest in the West Bradley Project,
Grady County, Oklahoma (hereinafter referred to as the "Assignment") is made
and entered into effective as of the 1st day of September, 1995, by and between
ASPECT RESOURCES LIMITED LIABILITY COMPANY ("Aspect") and BRIGHAM OIL & GAS,
L.P. ("BOG") (Aspect and BOG are sometimes individually referred to herein as a
"Party" and collectively referred to herein as the "Parties").

W I T N E S S E T H:

WHEREAS, OXY USA Inc. ("OXY"), WARD PETROLEUM CORPORATION ("Ward") and
Aspect entered into that certain Geophysical Agreement, West Bradley Project,
dated as of September 1, 1994, a copy of which is attached hereto as Exhibit B
(hereinafter referred to as the "Geophysical Agreement"), regarding the joint
conduct of a 3-D seismic geophysical program (hereinafter referred to as the
"Geophysical Program") across the lands in Grady County, Oklahoma, described in
Exhibit 1 to the Geophysical Agreement; and

WHEREAS, Ward, Quest Energy Corporation ("Quest") and Aspect entered
into that certain letter agreement dated September 1, 1994, a copy of which is
attached hereto as Exhibit C (hereinafter referred to as the "Ward Agreement"),
providing for Ward's assignment of an undivided thirty percent (30%) of its
interest in certain oil and gas leases covering the lands that are described in
Exhibit 2 to the Ward Agreement (hereinafter referred to as the "Ward Leases");
and

WHEREAS, Aspect and Quest entered into that certain 3-D Exploration
Agreement, West Bradley Project, Grady County, Oklahoma, dated September 9,
1994, a copy of which is attached hereto as Exhibit D (hereinafter referred to
as the "Quest 3-D Exploration Agreement"), providing for Aspect's payment of
certain consideration to Quest and the grant of an overriding royalty to Quest
burdening Aspect's interest in oil and gas interests covering the lands which
are described in Exhibit A which is attached hereto and incorporated herein for
all purposes (the lands described in Exhibit A which is attached hereto being
hereinafter referred to as the "West Bradley AMI"); and

WHEREAS, Aspect is interested in assigning one-third (1/3rd) of its
interest in the Geophysical Agreement, the Ward Agreement and the Quest 3-D
Exploration Agreement (the Geophysical Agreement, the Ward Agreement and the
Quest 3-D Exploration Agreement being sometimes collectively referred to herein
as the "Agreements") and all rights and property interests related thereto
(including without limitation the Ward Leases and all other property interests
acquired pursuant to the Agreements) to BOG pursuant to the terms, provisions
and reservations which are set forth in this Assignment; and

WHEREAS, Aspect and BOG are interested in creating an area of mutual
interest covering the West Bradley AMI as provided in this Assignment;

ARTICLE I.
TERMS OF ASSIGNMENT

Section 1.1. Assignment of Conveyed Interests. Aspect hereby grants,
bargains, sells, assigns and conveys to BOG one-third of (i) all of Aspect's
right, title and interest in, to and under the Agreements, (ii) all of Aspect's
right, title and interest in, to and under the Ward Leases, (iii) all of
Aspect's right, title and interest in, to and under any Subsequently Acquired
Interests (as such term is defined in the Geophysical Agreement) and (iv) all
of Aspect's other property rights of every kind (whether legal or equitable,
vested or contingent) obtained under or in any way related to the Agreements or
otherwise covering or related to the West Bradley AMI, whether same be now
owned or hereafter acquired by Aspect; provided, however, that Aspect is
reserving hereunder the Back-In
<PAGE> 2
Interest, as such term is defined in Section 2.2 below (the properties, rights
and interests described in (i), (ii), (iii) and (iv) above, subject to the
Back-In Interest reserved to Aspect hereunder, are herein collectively called
the "Conveyed Interests"). As part of the Conveyed Interests, BOG hereby owns
one-third of all of Aspect's rights, title and interests in and to the Ward
Leases, being one-third of the thirty percent (30%) interest in the Ward Leases
that is to be assigned (or which has been assigned) to Aspect in accordance
with the terms of the Ward Agreement, subject to the Back-In Interest.
Similarly, as part of the Conveyed Interests, BOG hereby owns one-third of all
of Aspect's right to participate in Subsequently Acquired Interests under the
terms of the Geophysical Agreement, being one-third of the twenty-five percent
(25%) interest in the Subsequently Acquired Interests in which Aspect has the
right to participate in accordance with the terms of the Geophysical Agreement,
subject to the Back-In Interest. In the event that prior to the date of this
Assignment Aspect has already elected to participate in a Subsequently Acquired
Interest, as part of the Conveyed Interests, BOG hereby owns one-third of all
of Aspect's rights, titles and interests in such Subsequently Acquired
Interest. Except as expressly provided herein with respect to the Back-In
Interest, as part of the Conveyed Interests, Aspect also grants, bargains,
sells and conveys to BOG all rights and benefits under the Agreements which are
appurtenant to or related to the Agreements and the ownership of the Ward
Leases and Subsequently Acquired Interests relating to the West Bradley AMI.
In the event that Aspect has already been assigned legal or record title to any
part of the Ward Leases and/or Subsequently Acquired Interests, concurrent with
its execution of this Assignment, Aspect shall assign BOG record title to one-
third of Aspect's interest in such Ward Leases and/or Subsequently Acquired
Interests utilizing the form of assignment which is attached hereto as Exhibit
E.

Section 1.3. Aspect in Good Standing Under the Agreements. Aspect
represents and warrants to BOG that Aspect is currently in good standing under
the terms of the Agreements and has not lost any rights or interests under the
Agreements due to any default, election or non-payment by Aspect.

ARTICLE II.
CONSIDERATION FOR ASSIGNMENT

Section 2.1. Cash Payment. Concurrent with its execution of this
Assignment BOG shall pay Aspect sixteen thousand six hundred sixty-seven
dollars ($16,667.00).

Section 2.2. Aspect's Payout Back-In Interest. Upon the occurrence of
Payout (as such term is defined below in this Section 2.2) BOG shall assign and
convey to Aspect an undivided fifteen percent (15%) of all of BOG's right,
title and interest in and to the Agreements and all property interests (real,
personal, tangible or intangible) obtained or owned by BOG under the terms of
the Agreements and/or this Assignment, including without limitation, an
undivided fifteen percent (15%) of BOG's interest in the seismic data, Ward
Leases, Subsequently Acquired Interests, non-consent interests and/or non-
participation interests acquired pursuant to the terms of the Agreements and
any and all wells that have been drilled or are drilling on the West Bradley
AMI as of the occurrence of Payout; provided, however, that Aspect's Back-In
shall be subject to proportionate reduction to account for any reductions
resulting from the reversion of non-consent or non-participation interests or
any back-ins resulting from the terms of farm-our or farm-in agreements. Upon
the occurrence of Payout, Aspect shall become responsible for all future costs,
expenses and liabilities which are incurred and allocated to the Back-In
Interest from and after the occurrence of Payout. For purposes of this
Assignment, "Payout" shall occur on the last day of the calendar month during
which the Net Revenues (as such term is defined below in this Section 2.2)
received by or otherwise allocable to BOG, from and after the effective date
hereof, equal or exceed one hundred percent (100%) of all of the Direct Costs
(as such term is defined below in this Section 2.2. As used in this Section
2.2, the term "Direct Costs" means and includes all costs (excluding any costs
for BOG's overhead, office administration, insurance, amortization or
depreciation) incurred and paid by BOG under the terms of the Agreements or
otherwise related to the West Bradley AMI, including

Brigham Oil & Gas, L.P.
Agreement and Assignment
West Bradley Project
2
<PAGE> 3
without limitation, all services, costs and liabilities of the Geophysical
Program, land acquisition and maintenance costs, and drilling, completion and
workover costs; however, such Direct Costs do not include any lease operating
expenses or taxes that are deducted in calculating Net Revenues as described
below. As used herein, the term "Net Revenues" shall mean all of the gross
revenues received by or otherwise allocable to BOG, from and after the
effective date hereof, to the extent same are from or attributable to the
Subject Hydrocarbons (as such term is defined below in this Section 2.2), less
all lease operating expenses attributable to production of Subject Hydrocarbons
and all production, severance, ad valorem, excise and other taxes (other than
income taxes) attributable to or measured by production of Subject
Hydrocarbons. As used herein, the term "Subject Hydrocarbons" shall mean all
of BOG's right, title and interest (whether legal or equitable, vested or
contingent, and whether now owned or hereafter acquired, by operation of law or
otherwise) in and to (i) any oil, gas or other minerals in, under or that may
be produced from the West Bradley AMI, and/or (ii) any oil, gas or other
minerals (or the proceeds thereof) that may otherwise be allocated to BOG under
or pursuant to the Agreements.

ARTICLE III.
RESPONSIBILITIES AND LIABILITIES
UNDER THE AGREEMENTS

Section 3.1. BOG Responsibility for Costs and Liabilities Related to
the Agreements and the Conveyed Interests after the Effective Date. Subject to
the terms and provisions of Section 3.2 below, BOG hereby agrees to assume and
be responsible for, and indemnify and hold Aspect harmless from, all costs,
expenses and liabilities that accrue under the Agreements after the effective
date of this Assignment and which are allocable on a heads-up basis to the
Conveyed Interests. BOG shall pay all costs and expenses which are incurred
after the effective date of this Assignment that are related to the Agreements
and allocated to the Conveyed Interests in accordance with the terms set forth
in the Agreements. Aspect shall remain responsible for the thirty thousand
dollar ($30,000.00) payment that is to be made to Quest following the
completion of the initial interpretation of the seismic data pursuant to the
terms of the Quest 3-D Exploration Agreement.

Section 3.2. Aspect Responsibility for Costs and Liabilities Allocable
to the Back-In Interest After Payout. Anything to the contrary contained in
Section 3.1 notwithstanding, Aspect shall be responsible for, and indemnify and
hold BOG harmless from, all costs, expenses and liabilities that accrue under
the Agreements after the occurrence of Payout which are allocable on a heads-up
basis to the Back-In Interest.

Section 3.3. Aspect Responsibility for Costs and Liabilities Incurred
Prior to the Effective Date. Aspect shall remain responsible for, and
indemnify and hold BOG harmless from, all costs, expenses and liabilities that
were incurred or which accrued under the Agreements prior to the effective date
of this Assignment.

ARTICLE IV.
SEISMIC DATA AND INTERPRETATIONS

Section 4.1. Program Data and Interpretations. BOG shall interpret the
seismic data resulting from the Geophysical Program for Aspect, Quest and Ward
pursuant to the terms set forth in the Ward Agreement; however, ASPECT
UNDERSTANDS AND AGREES THAT BOG MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY
KIND AS TO THE PROGRAM DATA OR INTERPRETATIONS THAT ARE PROVIDED TO ASPECT,
WARD OR QUEST, INCLUDING WITHOUT LIMITATION, THEIR FITNESS FOR A PARTICULAR
PURPOSE, MERCHANTABILITY OR ACCURACY, AND BOG HEREBY DISCLAIMS ANY AND ALL SUCH
REPRESENTATIONS OR WARRANTIES, AND ANY USE OF THE SEISMIC DATA OR
INTERPRETATIONS BY ASPECT, QUEST OR WARD, OR ANY ACTION TAKEN BY ANY OF SUCH
PARTIES SHALL BE BASED SOLELY ON SUCH PARTY'S OWN JUDGMENT, AND BOG AND ITS,
OFFICERS, EMPLOYEES, SUCCESSORS AND ASSIGNS, SHALL NOT BE LIABLE OR RESPONSIBLE
TO ASPECT, WARD OR QUEST FOR ANY LOSS, COST, DAMAGES, OR EXPENSE WHATSOEVER,
INCLUDING INCIDENTAL OR

Brigham Oil & Gas, L.P.
Agreement and Assignment
West Bradley Project
3
<PAGE> 4
CONSEQUENTIAL DAMAGES, INCURRED OR SUSTAINED AS A RESULT OF THE USE OF OR
RELIANCE UPON THE PROGRAM DATA OR INTERPRETATIONS, REGARDLESS OF WHETHER OR NOT
SUCH LOSS, COST, DAMAGE OR EXPENSE IS FOUND TO RESULT IN WHOLE OR IN PART FROM
THE SOLE OR CONCURRENT NEGLIGENCE OR OTHER FAULT OF BOG OR ITS OFFICERS, AGENTS
OR EMPLOYEES.

Section 4.2. No Charge for BOG's Services. Aspect shall not be
required to reimburse BOG for any costs that are incurred by BOG in
interpreting the seismic data which has resulted from the Geophysical Program.

Section 4.3. BOG's Right to Disclose its Interpretations to OXY. In
addition to all other disclosures that may be permitted under the terms of the
Agreements, Aspect hereby authorizes BOG to disclose and provide copies of its
interpretations of the seismic data that has resulted from the Geophysical
Program to OXY.

V.
ELECTIONS UNDER THE AGREEMENTS

Section 5.1. BOG's Right to Make Separate Elections Under the
Agreements. The Parties recognize and agree that BOG has the right to make
separate and independent elections under the Agreements with respect to its
participation with the Conveyed Interests, including, without limitation,
participation in the acquisition of oil and gas interests, and drilling,
completion and workover operations.

VI.
MISCELLANEOUS

Section 6.1. Entirety of Agreement. This Assignment contains the
entire understanding and agreement of the Parties with respect to the subject
matter hereof and supersedes all prior agreements, understandings,
negotiations, and discussions among the Parties with respect to such subject
matter.

Section 6.2. Assignment. This Assignment shall be binding upon and
inure to the benefit of the Parties hereto and their respective successors and
their respective assigns of rights hereunder; provided, however, that the
conveyance or assignment instrument vesting such assignee with all or part of
such interests must expressly provide that the assignment or conveyance is made
subject to the terms and conditions contained in this Assignment.

Section 6.3. Notices. All notices and other communications required or
permitted under this Assignment shall be in writing, and unless otherwise
specifically provided, shall be delivered personally, or by mail, telecopier or
delivery service, to the addresses set forth opposite the signatures of the
Parties below, and shall be considered delivered upon the date of receipt.
Each Party may specify its proper address or any other post office address
within the continental limits of the United States by giving notice to other
Parties, in the manner provided in this Section, at least ten (10) days prior
to the effective date of such change of address.

Section 6.4. Counterparts. This Assignment may be executed in multiple
counterparts, each of which shall be binding upon the signing Party or Parties
thereto as fully as if all Parties had executed one instrument, and all of such
counterparts shall constitute one and the same instrument. If counterparts of
this Assignment are executed, the signatures of the Parties, as affixed hereto,
may be combined in and treated and given effect for all purposes as a single
instrument.

Brigham Oil & Gas, L.P.
Agreement and Assignment
West Bradley Project
4
<PAGE> 5
IN WITNESS WHEREOF this Assignment is executed by the Parties on the
dates set forth opposite their respective signatures below but is effective for
all purposes as of the date first set forth above.

Address: BRIGHAM OIL & GAS, L.P.,
5949 Sherry Lane, Suite 1616 by Brigham Exploration Company,
Dallas, Texas 75225 its Managing General Partner
(214) 360-9182
Fax: (214) 360-9825

Dated:
--------------------
By:
------------------------------------
Ben M. Brigham, President / CEO

Address: ASPECT RESOURCES LIMITED
LIABILITY COMPANY
535 16th Street
Suite 820
Denver, Colorado 80202
(303) 573-7011
Fax: (303) 573-7340 By:
------------------------------------
(name printed)
-------------------------
Its:
-----------------------------------

Brigham Oil & Gas, L.P.
Agreement and Assignment
West Bradley Project
5