67 EXHIBIT 10.1
OIL AND GAS LEASE
AGREEMENT, made and entered into January 15, 1998, by and
Xxxxxxx Xxxxxxxx, a/k/a Xxxxxxx Xxxxx Xxxxxxxx, surviving Trustee
of the Xxxxxxxx Revocable Trust, Xxxxxxxx X. Xxxxxxxx and XxXxx
X. Xxxxxxxx, husband and wife, individually and as Co-Trustees
of the Xxxxxxxx X. Xxxxxxxx Revocable Trust and as Co-Trustees
of the XxXxx Xxxxxxxx Revocable Trust, Party of the first part,
hereinafter called lessor (whether one or more) and Mizar Energy
Company, Party of the second part, hereinafter called lessee.
WITNESSETH, that the said lessor, for and in consideration
of Ten and more Dollars, cash in had paid, receipt of which is
hereby acknowledged, and of the covenants and agreements
hereinafter contained on the part of lessee to be paid, kept and
performed, has granted, demised, leased and let and by these
present does grant, demise, lease and let unto said lessee, for
the sole and only purpose of mining and operating oil and gas,
and laying pipe lines, and building tanks, power stations and
structures thereon to produce, save and take care of said
products, all that certain tract of land, "together with any
reversionary rights therein," situated in the County of Xxxxxx,
State of Kansas, described as follows, to wit:
TOWNSHIP 16 SOUTH - RANGE 12 WEST
Section 11: Southeast Quarter (SE/4)
and containing 160 acres, more or less.
It is agreed that this lease shall remain in full force for
a term of one year from this date, and as long thereafter as oil
or gas, or either of them, is produced form said land by the
lessee, or the premises are being developed or operated.
In consideration of the premises the said less covenants and
agrees:
1st. To deliver to the credit of lessor, free of cost, in
the pipe line to which he may connect his xxxxx, the equal one-
eighth (1/8th) part of all oil produced and saved from the leased
premises.
2nd. The less shall pay to lessor for gas produced from any
oil well and used by the lessee for the manufacture of gasoline
or any other product as royalty 1/8th of the market value of such
gas at the mouth of the well' if said gas is sold by the lessee,
then as royalty 1/8th of the sale thereof at the mouth of the
well. The lessee shall pay lessor as royalty 1/8th of the
proceeds from the sale of gas as such at the mount of the well
where gas only is found and where such gas is not sold of used,
lessee shall pay or tender annually at the end of each yearly
period during which such gas is not sold or used as royalty, an
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amount equal to the delay rental provided in the next succeeding
paragraph hereof, and while said royalty is so paid or tendered
this lease shall be held as a producing lease under the above
term paragraph hereof' the lessor to have gas free of charge from
any gas well on the leased premises for stoves and inside lights
in the principal dwellinghouse on said land by making his own
connections with the well, the use of such gas to be at the
lessor's sole risk and expense.
If no well be commenced on said land on or before January
15, 1999, this lease shall terminate as to both parties.
If said lessor owns a less interest in the above described
land than the entire and undivided fee simple estate therein,
then the royalties and rentals herein provided shall be paid the
lessor only in the proportion which his interest bears to the
whole and undivided fee. However, such rental shall be increased
at the next succeeding rental anniversary after any reversion
occurs to cover the interest so acquired.
Less shall have the right to use, free of cost, gas, oil,
and water produced on said land for its operation thereon, except
water from xxxxx of lessor.
When requested by lessor, lessee shall bury his pipe lines
below plow depth.
No well shall be drilled neared than 200 feet to the house
or barn now on said premises, without the written consent of
lessor.
Lessee shall pay for damages caused by its operations on
said land.
Lessee shall have the right at any time to remove all
machinery and fixtures placed on said premises, including the
right to draw and remove casing.
If the lessee shall commence to drill a well within the term
of this lease or any extension thereof, the lessee shall have the
right to drill such well to completion with reasonable diligence
and dispatch, and if oil or gas, or either of them, be found in
paying quantities, this lease shall continue and be in full force
with the like effect as if such well had been completed within
the term of years herein first mentioned.
If the estate of either party herto is transferred, and the
privilege of transferring in whole or in part is expressly
allowed, or if the rights hereunder of either party hereto are
vested by descent or devise, the covenants hereof shall extend to
and be binding on the heirs, devises, executors, administrators,
successors, or assigns, but no change in the ownership of said
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land or of any right hereunder shall be binding on the lessee
until after lessee has been furnished with the original or a
certified copy thereof of any transfer by lessor or with a
certified copy of the will of lessor together with a transcript
of the probate thereof or, in the event lessor dies intestate and
his/her estate is being administered, with a transcript of the
administration proceedings or, in the event of the death of
lessor and no administration being had on the estate, with an
instrument satisfactory to lessee executed by lessor's heirs
authorizing payment or o deposit or tender for deposit to their
credit as hereinbefore provided, at least thirty days before said
rentals and royalties are payable or due, and it is hereby agreed
in the event this lease shall be assigned as a part or as to
parts of the above described lands and the assigned or assignees
of such part of parts shall fail or make default in the payment
of the proportionate part of the rents due from him/her or them,
such default shall not operate to defeat or affect this lease in
so far as it covers a part of parts of said lands upon which the
said less or any assignee thereof shall made due payments of said
rentals. In case lessee assigns this lease, in whole or in part,
lessee shall be relieved of all obligations with respect to the
assigned portion or portions arising subsequent to the date of
assignment. If the leased premises are now or hereafter owned in
severalty or in separate tracts, the premises, nevertheless, may
be developed and operated as an entirety, and the royalties shall
be paid to each separate owner in the proportion that the acreage
owned by him/her bears to the entire leased area. There shall be
no obligation on the part of the lessee to offset xxxxx on
separate tracts into which the land covered by this lease may
hereafter be divided by sale, devise, or otherwise, or to furnish
separate measuring or receiving tanks for the oil produced from
such separate tracts.
Lessor agrees that the lessee shall have the right at any
time to redeem for lessor by payment, any mortgages, taxes or
other liens on the above described lands, in the event of default
of payment by lessor, and be subrogated to the rights of the
holder thereof and may reimburse itself from any rental or
royalties accruing hereunder.
The terms, covenants and conditions hereof shall run with
said land and herewith and shall be binding upon the parties
hereto, their heirs, administrators, devisees, executors,
successors and assigns; however, all express or implied covenants
of this lease shall be subject to all Federal and State Laws,
Executive Orders, Rules or Regulations, and this lease shall not
be terminated, in whole or in part, nor less held liable for
failure to comply therewith, if compliance is prevented by, or if
such failure is the result of, any such Law, Order, Rule or
Regulation.
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Lessee assumes responsibility for ultimate plugging of the
three open holes on subject acreage and restoration of premises
which shall be accomplished not later than January 15, 1999.
Lessee acknowledges that a salt water disposal well is located on
the subject acreage and if it is not utilized in the production
of oil and gas under this lease, it will be plugged by Lessee not
later than January 15, 1999.
This lease is subject to a 1/16th of 7/8th Overriding
Royalty Interest reserved, to be credited to Xxxxxxxx X.
Xxxxxxxx.
IN WITNESS WHEREOF, this instrument is executed as of the
date first above written.
LESSOR
/s/ Xxxxxxx Xxxxxxxx, a/k/a Xxxxxxx Xxxxx Xxxxxxxx,
surviving Trustee of the Xxxxxxxx Revocable Trust
/s/ Xxxxxxxx X. Xxxxxxxx individually and as Co-trustee of the
Xxxxxxxx X. Xxxxxxxx Revocable Trust and as Co-trustee of the
XxXxx Xxxxxxxx Revocable Trust
/s/ XxXxx X. Xxxxxxxx, individually and as Co-trustee of the
Xxxxxxxx X. Xxxxxxxx Revocable Trust and as Co-trustee of the
XxXxx Xxxxxxxx Revocable Trust
Direct x
State of Kansas ) Invert
) ss. Indexed
Xxxxxx Co. ) Num x
Cross
This instrument was filed for records on the 30th day of
March, A.D., 1998, at 10:05 o'clock a.m. and duly recorded in
book 571 of General Records, Page 145, Fee $8.00.
/s/ Xxxxxx X. Xxxxxxx
Register of Deeds
STATE OF KANSAS )
) ss. Acknowledgement for individual
County of Xxxxxx ) (KS, OK, CO)
Before me, the undersigned, a Notary Public, within and for
said county and state, on this 12th day of March, 1998,
personally appeared Xxxxxxx Xxxxxxxx, a/k/a/ Xxxxxxx Xxxxx
Xxxxxxxx, surviving Trustee of the Xxxxxxxx Revocable Trust to me
personally known to be the identical person who executed the
within and foregoing instrument and acknowledged to me that she
executed the same as her free and voluntary act and deed for the
uses and purposes therein set forth.
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IN WITNESS WHEREOF, I have hereunto set my hand and official
seal the day and year least above written.
My Commission Expires /s/ Xxxxx Xxxxxx
7/23/98 Notary Public
STATE OF KANSAS )
) ss. Acknowledgement for individual
County of Xxxxxx ) (KS, OK, CO)
Before me, the undersigned, a Notary Public, within and for
said county and state, on this 12th day of March, 1998,
personally appeared Xxxxxxxx X. Xxxxxxxx and XxXxx X. Xxxxxxxx,
husband and wife, individually and as Co-Trustees of the Xxxxxxxx
X. Xxxxxxxx Revocable Trust and as Co-trustees of the XxXxx
Xxxxxxxx Revocable Trust to me personally known to be the
identical persons who executed the within and foregoing
instrument and acknowledged to me that they executed the same as
their free and voluntary act and deed for the uses and purposes
therein set forth.
IN WITNESS WHEREOF, I have hereunto set my hand and official
seal the day and year least above written.
My Commission Expires /s/ Xxxxx Xxxxxx
7/23/98 Notary Public
