TERM ASSIGNMENT
UHC PETROLEUM CORPORATION, ("Assignor"), whose mailing address is P. O.
Box 1956, Cleburne, Texas 76033, is the present owner of certain oil and gas
leasehold rights covering lands in ▇▇▇▇▇▇▇ County, Texas, as described in
Exhibit "A," attached hereto and by reference made a part hereof insofar as they
cover the depths described in Exhibit "A", hereinafter referred to as the
"Lands," held under the terms of the Oil and Gas Leases insofar and only insofar
as same are described in Exhibit "A," hereinafter referred to as the "Leases."
DOMINION OKLAHOMA TEXAS EXPLORATION & PRODUCTION, INC., ("Assignee"),
whose mailing address is ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, desires to purchase an assignment of the oil and gas leasehold
rights as to the Lands and Leases.
For and in consideration of the premises and the sum of Ten Dollars
($10.00) cash paid by Assignee and other good and valuable consideration,
including covenants contained herein, the receipt and sufficiency of which are
hereby acknowledged, Assignor and Assignee hereby agree to the following terms
and conditions:
1. CONVEYANCE OF LEASES
Assignor does hereby transfer, assign and convey, without warranty,
express or implied, unto Assignee, its successors and assigns, 85.0%
of Assignor's right, title and interest in and to the Leases insofar
as they cover the Lands described in Exhibit "A" as to all depths
below 2000' below the surface, and Assignor reserves all of its
interest in the Leases insofar as they cover depths above 2000'.
2. OVERRIDING ROYALTIES
Assignor reserves an overriding royalty interest equal to the
difference between 26% and existing leasehold burdens (inclusive of
the landowner's royalty) determined on a lease-by-lease basis, it
being the intent of this Assignment that Assignor convey to Assignee
a net revenue interest of 74.0% in the Leases and Lands. The
production produced attributable to the overriding royalty interest
retained by UHC may be taken in "kind" at the option of UHC. Any
reserved overriding royalty interest is subject to proportionate
reduction as set out in paragraph 12, below. Further, any reserved
overriding royalty interest shall be free of development, production
and operating expenses, but shall bear its proportionate share of
post-production costs incurred by Assignee (including without
limitation all costs associated with compressing, processing,
separating, treating, dehydrating, gathering, pipelines,
transporting and marketing) as well as its proportionate share of
all ad valorem, production, severance, excise and all other taxes
assessed against the production subject to such overriding royalty
interest.
3. NO WARRANTY OR REPRESENTATIONS
THIS ASSIGNMENT IS EXECUTED WITHOUT WARRANTY OF TITLE, EITHER
EXPRESS OR IMPLIED, WITHOUT ANY EXPRESS OR IMPLIED WARRANTY OR
REPRESENTATION AS TO THE MERCHANTABILITY OF ANY OF THE EQUIPMENT OR
PERSONAL PROPERTY, IF ANY, OR ITS FITNESS FOR ANY PURPOSE AND
WITHOUT ANY OTHER EXPRESS OR IMPLIED WARRANTY OR REPRESENTATION
WHATSOEVER.
4. TERM
Subject to the other provisions herein contained, this Assignment
shall be for a term of two (2) years after the effective date (the
"Primary Term"), and so long thereafter as oil, gas or associated
hydrocarbons are produced in paying quantities from the Lands, or on
lands pooled therewith, or there is a shut-in gas well capable of
producing gas in paying quantities on the Lands, or on lands pooled
therewith.
5. CONTINUOUS DEVELOPMENT
In addition to and notwithstanding any other provision herein, this
Assignment shall not terminate in whole or in part, regardless of
whether production of oil or gas has been established from the Lands
at the end of the Primary Term so long as Assignee is engaged in
Continuous Drilling Operations on the Lands. "Continuous Drilling
Operations" as used herein shall mean the drilling of ▇▇▇▇▇ without
more than 180 days elapsing between the completion of one well and
the commencement of actual drilling of the next well, "completion"
being the date a well is either plugged and abandoned or completed
as set out in the official State form. The actual drilling of the
first such well must be commenced on or before the end of the
Primary Term. Provided, if Assignee is prevented from commencing
operations on any well due to rig availability, competent crew
availability, permitting delays caused by any governmental
authority, weather or other conditions beyond Assignee's control,
then the Primary Term, if operations for the initial well are
affected, or the 180-day period, if operations for a subsequent well
are affected, will be suspended until such condition has been
removed.
6. REASSIGNMENT
At the conclusion of Assignee's Continuous Drilling Operations, or
at the end of the Primary Term if Assignee is not then engaged in
Continuous Drilling Operations, Assignee will reassign to Assignor
all leasehold rights assigned hereby less and except (i) all rights
in ▇▇▇▇▇ drilled by or on behalf of Assignee during this Term
Assignment and (ii) all rights in 320 acres attributable to each
well drilled by or on behalf of Assignee during this Term Assignment
as designated and platted by Assignee.
7. SUBSTITUTE ▇▇▇▇▇
If, during the drilling of any well by or on behalf of Assignee
during this Term Assignment, the hole is lost or junked before
reaching the objective depth, or if Assignee encounters conditions
in the hole that render further drilling or completion impractical,
Assignee may drill a substitute well if operations for such
substitute well are commenced within 60 days after abandonment of
the unsuccessful operations.
8. AGREEMENTS TO WHICH ASSIGNMENT IS SUBJECT
This Assignment is subject to all agreements of record affecting the
Lands.
9. INDEMNIFICATION
ASSIGNEE AGREES TO DEFEND, PROTECT AND INDEMNIFY, AND HOLD HARMLESS
ASSIGNOR , ITS EMPLOYEES AND AGENTS, FROM AND AGAINST EACH AND EVERY
CLAIM, DEMAND, ACTIONS, CAUSE OF ACTION, OR LAWSUIT, AND ANY
LIABILITY, COST, EXPENSE, PENALTY, DAMAGE, OR LOSS, INCLUDING COURT
COSTS AND ATTORNEY'S FEES, THAT MAY BE ASSERTED AGAINST ASSIGNOR OR
ASSIGNEE BY ANY THIRD PARTY, INCLUDING ASSIGNEE'S EMPLOYEES AND
AGENTS, AND GOVERNMENTAL AGENCIES, ARISING FROM OR AN ACCOUNT OF ANY
OPERATIONS CONDUCTED ON THE LANDS HEREUNDER BY ASSIGNEE, OR FOR THE
BENEFIT OF ASSIGNEE.
ASSIGNOR AGREES TO DEFEND, PROTECT AND INDEMNIFY, AND HOLD HARMLESS
ASSIGNEE, ITS EMPLOYEES AND AGENTS, FROM AND AGAINST EACH AND EVERY
CLAIM, DEMAND, ACTIONS, CAUSE OF ACTION, OR LAWSUIT, AND ANY
LIABILITY, COST, EXPENSE, PENALTY, DAMAGE, OR LOSS, INCLUDING COURT
COSTS AND ATTORNEY'S FEES, THAT MAY BE ASSERTED AGAINST ASSIGNEE OR
ASSIGNOR BY ANY THIRD PARTY, INCLUDING ASSIGNOR'S EMPLOYEES AND
AGENTS, AND GOVERNMENTAL AGENCIES, ARISING FROM OR AN ACCOUNT OF ANY
OPERATIONS CONDUCTED ON THE LANDS HEREUNDER BY ASSIGNOR, OR FOR THE
BENEFIT OF ASSIGNOR.
10. COMPLIANCE WITH LAWS
Assignee shall observe, perform and comply with the terms,
provisions, covenants and conditions, express or implied, of the
Leases and with all laws, rules, regulations and orders, both State
and Federal, applicable to ownership and enjoyment of the rights
herein assigned.
11. RESPONSIBILITY FOR PLUGGING
Assignee agrees to accept full responsibility for the plugging and
abandonment and restoration and remediation of all ▇▇▇▇▇ located on
the Lands drilled by Assignee or on behalf of Assignee and agrees to
comply with all the requirements of the Leases and of the State of
Texas, including the rules and regulations of the Texas Railroad
Commission or successor regulatory body, in effect at the time any
well is plugged.
12. PROPORTIONATE REDUCTION
This Assignment is made without express or implied warranty of any
kind; provided however, if a lease covers less interest than the
entire fee simple mineral estate in the oil and gas in the Lands
embraced therein, or if Assignor hereby conveys less than the full
leasehold estate in a lease as to the Lands embraced therein, then
the overriding royalties reserved in such lease under the terms of
this Assignment shall be reduced proportionately.
13. TAXES
Assignor shall be responsible for the payment of all ad valorem or
other similar property taxes, if any, prior to the effective date of
this Assignment and Assignee shall be so responsible thereafter,
except as to applicable gross production and severance taxes
assessed against Assignor's overriding royalty interest.
14. RELATIONSHIP OF THE PARTIES
This Assignment is not intended to create, and nothing herein shall
be construed to create an association, a trust, a joint venture, a
mining partnership, or other partnership or entity of any kind.
IN WITNESS WHEREOF, this Assignment effective as of the 13th day of
April, 2005 (to be completed at closing).
ASSIGNOR:
UHC PETROLEUM CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇, President
ASSIGNEE:
DOMINION OKLAHOMA TEXAS
EXPLORATION & PRODUCTION, INC.
By: /s/ ▇. ▇. ▇▇▇▇▇
----------------------------------------
▇. ▇. ▇▇▇▇▇, Attorney in Fact
ACKNOWLEDGMENTS
STATE OF TEXAS )
)
COUNTY OF ▇▇▇▇▇▇ )
The foregoing instrument was acknowledged before me on 13, April 2005, by
▇▇▇▇▇▇ ▇. ▇▇▇▇, President of UHC Petroleum Corporation, a Texas corporation, or
behalf of said corporation.
My commission expires:
Stamp (unreadable) /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Notary Public
STATE OF OKLAHOMA )
)
COUNTY OF OKLAHOMA )
The foregoing instrument was acknowledged before me on 20, April 2005, by
▇. ▇. ▇▇▇▇▇, Attorney in Fact for Dominion Oklahoma Texas Exploration &
Production, Inc. a Delaware corporation, on behalf of said corporation.
My commission expires:
Stamp: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Notary Public Notary Public 01019159
Comm. Exp. 12-14-2006
State of Oklahoma
Oklahoma County
EXHIBIT "A"
Attached hereto and made a part of that certain Term Assignment from UHC
Petroleum Corporation, Assignor, to Dominion Oklahoma Texas Exploration &
Production, Inc., Assignee, effective April 13, 2005.
Lease No. 1.
------------
Lessor: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Less ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and Less ▇▇▇▇▇▇▇ ▇▇▇▇
Lessee: Heritage West Corporation
Date: September 1, 1981
Recorded: Book Z-32, Page 463, Miscellaneous Records, ▇▇▇▇▇▇▇ County, Texas
Description of Lands: 427.75 acres of land, more or less, being the North 427.75
acres of Survey 170, Abstract 2197, CCSD & RGNG RR Co. Survey, ▇▇▇▇▇▇▇ County,
Texas.
Lease No. 2.
------------
Lessor: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇
Lessee: Heritage West Corporation
Date: September 1, 1981
Recorded: Book Z-32, Page 432, Miscellaneous Records, ▇▇▇▇▇▇▇ County, Texas
Description of Lands: 1,676.50.00 acres of land, more or less, situated in
▇▇▇▇▇▇▇ County, Texas, and described as follows:
SURVEY ABSTRACT CERTIFICATE ORIGINAL GRANTEE ACRES
--------------------------------------------------------------------------------
S 225.25 ac. 2197 605 CCSD & RGNG Ry. Co. 225.25
of Survey 170
S 231.25 ac. 759 605 CCSD & RGNG Ry. Co. 231.25
of Survey 169
79 - All 934 4/1836 G.C. & S.F. Ry. Co. 640.00
80, Blk.B 2923 4/1836 G.C. & S.F. Ry. Co. 580.00
Lease No. 3.
------------
Lessor: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 1978 Trust
Lessee: Heritage West Corporation
Date: September 1, 1981
Recorded: Book Z-32, Page 448, Miscellaneous Records, ▇▇▇▇▇▇▇ County, Texas
Description of Lands: 1,600.00 acres of land, more or less, situated in ▇▇▇▇▇▇▇
County, Texas, and described as
follows:
SURVEY ABSTRACT CERTIFICATE ORIGINAL GRANTEE ACRES
--------------------------------------------------------------------------------
5 - all 884 4/1732 G.C. & S.F. Ry. Co. 640.00
6 - all 2037 4/1732 G.C. & S.F. Ry. Co. 640.00
8 - N/4 2102 4/1732 G.C. & S.F. Ry. Co. 160.00
9 - N/4 886 4/1732 G.C. & S.F. Ry. Co. 160.00
Lease No. 4.
------------
Lessor: ▇. ▇. ▇▇▇▇▇▇▇ Estate
Lessee: Heritage West Corporation
Date: September 1, 1981
Recorded: Book Z-32, Page 417, Miscellaneous Records, ▇▇▇▇▇▇▇ County, Texas
Description of Lands: 4,160.00 acres of land, more or less, situated in ▇▇▇▇▇▇▇
County, Texas, and described as follows:
SURVEY ABSTRACT CERTIFICATE ORIGINAL GRANTEE ACRES
--------------------------------------------------------------------------------
7 - all 885 4/1733 G.C. & S.F. Ry. Co. 640.00
8 - S 3/4 2101 4/1733 G.C. & S.F. Ry. Co. 480.00
9 - S 3/4 886 4/1734 G.C. & S.F. Ry. Co. 480.00
12 - all 2352 4/1735 G.C. & S.F. Ry. Co. 640.00
13 - all 888 4/1736 G.C. & S.F. Ry. Co. 640.00
14 - all 2252 4/1736 G.C. & S.F. Ry. Co. 640.00
15 - all 889 4/1737 G.C. & S.F. Ry. Co. 640.00
