CROFF PURCHASE AGREEMENT
This Purchase Agreement is being made and entered into
between Croff Oil Company, St. James Oil Company, and Jenex
Operating Company, this seventh day of April, 1998. Croff Oil
Company of 1675 Broadway, Suite 1030, Denver, Colorado 80202, is
hereafter referred to as "Croff", Jenex Operating Company of 1675
Broadway, Suite 1030, Denver, Colorado 80202, is hereafter
referred to as "Jenex", and St. James Oil Company of P.O. Box
5188, Stateline Nevada, 89449, is hereafter referred to as "St.
James".
RECITALS
St. James owns certain producing leases on which Jenex is
the operator of certain oil and gas wells in Oklahoma. St. James
desires to sell these operated wells for cash to Croff. Croff is
interested in purchasing these wells from St. James. Jenex is
the operator of these wells and has agreed to rebate a fixed
portion of the operating revenues to Croff.
AGREEMENT
1. Croff hereby agrees to buy the following leases from St.
James, and the operating wells thereon commonly known as the
Mueggenborg, Duncan, Fannie Brown, Miller, Dickerson, and
one-half of the Harper, which leases and wells are more
particularly described on Exhibit "A", attached hereto and
by this reference incorporated herein. The leases shall
include all the interest of St. James in these mineral
estates. All operated wells, all equipment, inventory,
receivables, and rights and offsets are included, except for
the Harper well in which St. James is conveying 1/2 of its
leasehold interest, the other half being conveyed to Jenco
Petroleum Corporation.
2. St. James hereby agrees to convey to Croff the leases set
out on Exhibit "A" by Quit Claim deed effective April 1,
1998, including all of St. James net revenue interest, which
includes all of its present leasehold estate except in the
Harper well in which is included 1/2 of St. James' leasehold
estate. Such leases will be conveyed by quitclaim
assignment with a stipulation that purchaser will assume
full responsibility for all leases in their present
condition, including any and all environmental or remedial
work which should be attributed to a non-operating working
interest. A sample of such quitclaim assignment is attached
hereto as Exhibit "B".
3. The consideration to be paid by Croff for the assignment of
the leases as described on Exhibit "A", shall be $208,000.
The consideration shall be paid by wire transfer or
cashier's check at closing.
4. Jenex hereby agrees to provide a credit of $150 dollars per
month for each well being purchased by Croff, as long as the
lease is held by Croff. The total credit will be $150 per
well, for six wells, or a total of $900 per month. This
credit is available only to Croff, and is not transferable
to any subsequent purchaser.
5. This Purchase Agreement has been approved by the Board of
Directors of Croff and Croff has authorized its President to
enter into this Agreement. Croff represents that it is in
the oil and natural gas business and will conduct its own
due diligence with respect to these leases.
6. St. James hereby represents and warrants that it is a Nevada
Corporation, that it has full authority to enter into this
Agreement, that James Jensen, the officer, executing this
Agreement is duly authorized, that it has full authority to
sell the leases being conveyed, and that it is not aware of
any information with respect to these leases which is not
available to Croff through Jenex Operating Company, at 1675
Broadway, Suite 1030, Denver, Colorado 80202; that such
leases are free and clear of any liens and encumbrances, and
there are no claims or litigation threatened or filed with
respect to these leases.
7. Jenex Operating Company hereby represents and warrants that
it is a Colorado Corporation, that this Agreement has been
duly authorized by its Board of Directors, and that this
Agreement is binding on Jenex, effective with the transfer
of all ownership in Jenex Operating Company to Jenco
Petroleum Corporation.
8. Closing shall take place at the offices of Jenex Operating
Company at 1675 Broadway, Suite 1030, Denver, Colorado 80202
at 10:00 A.M. on April 8, 1998. Notwithstanding the date of
closing, the effective date of all Assignments of the leases
shall be midnight, March 31, 1998.
9. All revenue prior to the effective date shall belong to St.
James and all revenue subsequent to the effective date shall
belong to Croff. All joint interest billings, expenses, and
costs of the well prior to the effective date shall be paid
by St. James, and after the effective date by Croff.
10. This Agreement is being entered into in the State of
Colorado, and Colorado law shall apply for all purposes.
11. This Agreement shall be binding upon the parties hereto,
their successors, transferee's, or assigns.
12. This Agreement shall be executed in counterparts, each of
which shall be an original.
13. Croff Oil Company shall have the sole right to make any
public announcement of this purchase.
In witness whereof, the parties hereto have made in entered
into this Purchase Agreement, the day and year first above
written.
Attest:
Croff Oil Company
Attest:
Jenex Operating Company
Attest:
St. James Oil Company
C:\WORD\LEGAL\AGREEMNT\CROFFPUR.DOC
EXHIBIT "A"
Harper #1 T22N-R18W-Sec. 20
Woodward County, Oklahoma
One-half St. James
interest in this
well
Miller T22N-R18W-Sec. 29
Woodward County, Oklahoma
Fannie Brown T9N-R10W-Sec. 11
Caddo County, Oklahoma
Dickerson T15N-R5W-Sec. 34
Kingfisher County, Oklahoma
Mueggenborg T15N-R5W-Sec. 35
Kingfisher County, Oklahoma
Duncan T9N-R25E-Sec. 21
LeFlore County, Oklahoma