EXHIBIT 2(d)
PURCHASE AND SALE AGREEMENT
This Agreement, when accepted and agreed to in the manner provided below
shall constitute the terms and provisions of an agreement under which MAYNARD
OIL COMPANY, a Delaware corporation, with offices at 8080 North Central
Expressway, Suite 660, Dallas, Texas 75206, hereinafter referred to as
"SELLER", agrees to sell and JIMMY R. CHATHAM, an individual doing business as
CHATHAM OIL COMPANY, whose address is in care of the First National Bank &
Trust Company, P. O. Box 69, Ardmore, Oklahoma 73402, hereinafter referred to
as "BUYER", agrees to purchase all of SELLER'S rights, titles and interests in
and to those certain oil and gas properties owned by SELLER and described in
Exhibit "A", Property Schedule attached hereto and made a part hereof,
hereinafter sometimes referred to as the "PROPERTY".
1. PROPERTY BEING SOLD. At Closing, as hereinafter defined, SELLER shall
convey to BUYER the PROPERTY identified on Exhibit "A", including:
(a) All of SELLER'S rights, titles and interests in and to the leasehold
estates described in Exhibit "A", such leases being hereinafter called "said
leases", represented to be no less than the working and net revenue interests
set forth on such exhibit;
(b) All of SELLER'S fee interests, royalties, overriding royalties,
production payments, rights to take royalties in kind, or other interests in
production of oil, gas or other minerals in the lands described in Exhibit "A";
(c) All of SELLER'S rights, titles and interests in and to all permits,
franchises, licenses, servitudes, easements, surface leases and rights-of-way
of every character relating to said leases;
(d) All of SELLER'S rights, titles and interests in and to any contracts
or agreements including, but not limited to, rights and interests in or derived
from unit agreements, gas processing agreements, joint operating agreements,
gas contracts, gas gathering agreements, gas balancing agreements, boundary or
well line agreements, assignments of operating rights, working interests and
subleases affecting said leases.
(e) All of SELLER'S rights, titles and interests in and to producing,
non-producing and shut-in oil and gas wells, salt water disposal wells,
injection wells and water wells on said leases or lands pooled, unitized or
communitized therewith; and
(f) All of SELLER'S rights, titles and interests in and to all surface
and down-hole equipment, fixtures, related inventory and other personal
property used in connection with the PROPERTY described in paragraphs (a)
through (e) above, excluding, however, all automobiles, trucks and
communications equipment.
2. PERFORMANCE DEPOSIT. On or before 4:00 o'clock p.m., local time,
August 20, 1996, BUYER shall tender to SELLER, by wire transfer, a performance
deposit in the amount of Forty Four Thousand Four Hundred Forty Four and 40/100
Dollars ($44,444.40). The performance deposit is received solely to assure the
performance of BUYER pursuant to the terms and conditions hereof. The
performance deposit will be returned to BUYER at Closing upon consummation of
the transaction, or at BUYER'S election, may be credited to the Purchase Price.
No interest shall be paid or credited to the performance deposit. If BUYER
fails, refuses, or is unable to close the sale in accordance with the terms
herein, SELLER, except as otherwise herein specifically provided, may, at its
option, retain the performance deposit as agreed liquidated damages and not as
a penalty. If SELLER, through no fault of BUYER, refuses to close the sale in
accordance with the terms herein, the performance deposit shall be returned to
BUYER.
3. PURCHASE PRICE. The total sum which BUYER agrees to deliver to
SELLER for the PROPERTY, is Four Hundred Forty Four Thousand, Four Hundred
Forty Four and 00/100 Dollars ($444,444.00).
4. CLOSING. The closing shall take place on September 30, 1996, at
10:00 a.m. local time at SELLER'S offices in Dallas, Texas, unless the parties
mutually agree upon a later date, or, at BUYER'S election, such closing may be
handled by overnight mail upon confirmation of funds received by SELLER. The
following shall occur at closing:
(a) Purchase Price. BUYER will make payment of the Purchase Price
pursuant to paragraph numbered 3 above, and adjusted by Sections 2, 9, 10, 12,
15, 18 and 20, if applicable, by wire transfer to an account designated by
SELLER; and
(b) Conveyance. SELLER will convey the PROPERTY to BUYER by executing
and delivering Assignments and Bills of Sale, a form of which is attaches of
August 1, 1996, at 7:00 a.m. local time, herein called the "Effective Date".
BUYER shall assume the risk of any change in the condition of the PROPERTY from
the date of this Agreement to the date of Closing.
6. FILES AND RECORDS. Prior to Closing, SELLER will make available for
examination by BUYER such title information and abstract coverage as may be
available in SELLER'S files. Existing abstracts and title opinions will not be
brought down to date by SELLER. SELLER'S files will be made available to BUYER
for examination at SELLER'S offices in Dallas, Texas, during normal working
hours. BUYER will be permitted, to make copies of pertinent instruments or
documents contained in SELLER'S files. No economic analyses, interpretive
geological or geophysical data considered proprietary by SELLER shall be copied
by BUYER. As soon as practicable after Closing, SELLER shall deliver all of
the original files or copies thereof to BUYER, at BUYER'S expense.
7. LIMITED WARRANTY. Conveyance of the PROPERTY shall be WITHOUT
WARRANTY OF TITLE EITHER EXPRESS OR IMPLIED, EXCEPT BY, THROUGH AND UNDER
ASSIGNOR, BUT NOT OTHERWISE with the right of full substitution and subrogation
in and to all rights and actions of warranty which SELLER has or may have
against any and all preceding owners or vendors of the PROPERTY.
8. INDEPENDENT EVALUATION. BUYER has made an independent evaluation of
the PROPERTY and acknowledges that SELLER has made no statements or
representation concerning the present or future value of the anticipated
income, costs, or profits, if any, to be derived from the PROPERTY and that
SELLER DOES NOT WARRANT TITLE, DESCRIPTION, VALUE, QUALITY, CONDITION,
MERCHANTABILITY, OR FITNESS FOR PURPOSE of any of the wells, equipment, or
other property located thereon or used in connection therewith. BUYER further
acknowledges that in executing this Agreement it has relied solely upon its
independent examination of the premises and peement, the term "significant
title defect" shall include any defect which results in a loss of title in
SELLER such that BUYER'S net revenue interest in the affected PROPERTY is
reduced or SELLER'S rights to use the PROPERTY as an owner, lessee, licensee,
or permittee, as applicable, is extinguished or severely restricted.
On or before ten (10) business days prior to Closing, BUYER shall give
written notice to SELLER of interests in the PROPERTY which have significant
title defects. BUYER shall be deemed to have waived all title defects and any
other defect of which SELLER has not been given notice by ten (10) business
days prior to Closing, unless it is a significant title defect which did not
exist on or before that date.
Interests which have significant title defects shall be excluded from the
PROPERTY to be conveyed and the Purchase Price shall be reduced by the price
allocated by Buyer for such PROPERTY on Exhibit "A", Property Schedule,
attached hereto unless: (i) prior to closing, the basis for the significant
title defect has been removed, or (ii) BUYER agrees to accept the interest
notwithstanding the defect. Loss of any lease acreage between the Effective
Date and Closing due to expiration of the lease term will not constitute a
significant title defect.
10. OPERATIONS AND PRODUCTION AFTER EFFECTIVE DATE. Since the Closing
will occur subsequent to the Effective Date, SELLER will continue to operate
the PROPERTY, or cause the PROPERTY to be operated, as appropriate for the
account of SELLER until Closing. SELLER shall be responsible for payments of
all expenses incurred against operation of the PROPERTY prior to the Effective
Date. All production from oil and gas wells, and all proceeds from the sale
thereof, including proceeds from any imbalance and oil in storage above the
pipeline connection, attributable to production prior to the Effective Date
shall be the property of SELLER. All production and proceeds attributable to
production aER. At Closing, a settlement shall be made between BUYER and
SELLER of all production proceeds received by SELLER and all operating
expenditures and taxes paid by SELLER for the time period between the Effective
Date and Closing. The net settlement balance shall be deducted from or added
to the Purchase Price. Applicable costs and expenses will include, without
limitation, royalties, rentals, any and all taxes related to said production,
and expenses of the type customarily billed under an operating agreement. As
to those properties not subject to an operating agreement, SELLER will charge
BUYER the appropriate Mean Fixed-Rate Overhead per producing, injection or
disposal well located on the PROPERTY as provided in the 1995 ERNST & YOUNG
LLP'S, "FIXED RATE OVERHEAD SURVEY". BUYER will reimburse SELLER for all
workover costs, plugging, abandoning and reabandoning costs and other major
costs that SELLER incurs after the Effective Date, on an actual cost basis.
SELLER shall not undertake any single project reasonably estimated to require
an expenditure in excess of $3,000.00 without the prior written consent of
BUYER; however, SELLER may take such steps and incur such expenses as in its
opinion are required to deal with an emergency or to safeguard life and
property. If timing allows, a Chatham pulling unit will be utilized for any
well servicing work prior to Closing.
BUYER shall assume SELLER'S position under any gas balancing arrangements.
The interest to be conveyed BUYER shall be burdened with any liability
attributable to SELLER'S interest for overproduction from the PROPERTY and
BUYER shall own and be entitled to any make-up production attributable to
SELLER'S interest for underproduction from the PROPERTY.
Within one hundred twenty (120) days after the Closing, SELLER and BUYER
shall make a post-closing settlement to account for all production proceeds
received and all operating expenses and taxes paid by SELLER after the
Effective Date. After the post-closing settlement, additional proceeds
received by or expenses paid by either BUYER or SELLER on behalf of the other
shall be settled by invoicing the other party for expenses paid or remitting to
the other party any proceeds received.
SELLER shall comply with all applicable laws, ordinances, rules, and
regulations, orders, terms of permits and authorizations, of any governmental
body which may have jurisdiction over the PROPERTY and shall promptly obtain
and maintain all permits and bonds required by public authorities in connection
with the PROPERTY. As of the Effective Date, BUYER shall assume and agrees to
perform all obligations and implied covenants of SELLER relating to the
PROPERTY. BUYER shall assume the risk of any change in the condition of the
PROPERTY from the Effective Date to the Closing, except to the extent any
change of condition is attributable to the negligence or willful misconduct of
SELLER.
11. SUSPENDED FUNDS. As soon as practicable after the Closing, SELLER
shall provide to BUYER a listing showing all net proceeds from production
attributable to the royalty and overriding royalty interests which are
currently held in suspense because of lack of identity or address of owners,
change of ownership or similar reasons, and shall transfer to BUYER all those
suspended proceeds. BUYER shall be responsible for proper distribution of all
the suspended proceeds to the parties lawfully entitled to them.
12. TAXES. BUYER shall be responsible for payment of all taxes relating
to its interests in the PROPERTY from and after the Effective Date. SELLER
shall be responsible for payment of all taxes relating to its interest in the
PROPERTY prior to the Effective Date. Property and ad valorem taxes payable on
an annual basis shall be prorated between SELLER and BUYER as of the Effective
Date. BUYER shall be liable for any sales tax or other transfer tax.
13. EXISTING CONTRACTS. This sale will be made signments, as well as any
and all other agreements or contracts of any nature to which the PROPERTY is
subject.
14. NOTICES. All notices and communications required or permitted under
this Agreement shall be in writing, deliver to or sent by U. S. Mail or Express
Delivery, postage prepaid, or by facsimile transmission, addressed as follows:
Maynard Oil Company
Attention Cassondra Foster
8080 North Central Expressway, Suite 660
Dallas, TX 75206
Phone: (214) 891-8461
Fax: (214) 891-8827
Chatham Oil Company
Attention Mr. Jimmy R. Chatham
P. O. Box 878
Healdton, OK 73438
Phone: (405) 229-1267
Fax: (405) 229-0971
15. PARTIES IN INTEREST. This Agreement shall inure to the benefit of
and be binding upon SELLER and BUYER, their respective successors and assigns.
All references contained in the Agreement shall be deemed to include SELLER and
BUYER'S respective successors and assigns. No assignment by any party shall
relieve any party of any duties or obligations under this Agreement.
16. PREFERENTIAL RIGHTS TO PURCHASE. Should any of the PROPERTY offered
be subject to a preferential right to purchase or consent to assign, then the
proposed sale of the PROPERTY affected thereby will be subject to SELLER'S
obtaining any such waiver or consent. SELLER shall not be liable to BUYER by
reason of inability or failure to obtain any such waiver or consent. In the
event any third party exercises its preferential right to purchase, the price
shall be the value indicated by SELLER on the Property Schedule and the parties
shall reduce the Purchase Price by the value assigned. At Closing, if SELLER
has been unable to obtain a required waiver or consent (or the appropriate time
period for asserting such rights has not expired), the Purchase Price shall be
reduced by an amount equal to the Allocated Value assigned to the interest
affected by such waiver or consent. This paragraph shall not be applicable to
oil and gas leases requiring consent by, filings with, or other actions by
governmental entities in connection with the sale or conveyance of oil and gas
leases or interests therein, if the same are customarily obtained subsequent to
such sale or conveyance.
17. INDEMNITY. BUYER shall assume full responsibility for the PROPERTY
purchased as of the Effective Date and shall defend and indemnify SELLER, its
employees, officers and agents, against any and all losses, claims, suits,
liabilities, and expenses arising out of, in connection with or resulting from
BUYER'S ownership or operation of the PROPERTY purchased, including, but not
limited tth all covenants in the instruments in the chain of title of the
PROPERTY purchased or the instruments to which the PROPERTY is subject.
SELLER shall defend and indemnify BUYER, its employees, officers and
agents, against any and all losses, claims, suits, liabilities, and expenses
arising out of, in connection with or resulting from SELLER'S ownership or
operation of the PROPERTY purchased prior to the effective date.
18. REGULATORY FORMS. At Closing, SELLER shall deliver to BUYER signed
forms to be filed with appropriate governmental agencies, including, but not
limited to Change of Operator Forms. BUYER agrees to promptly file such forms
with the appropriate governmental agencies.
19. WELL TESTS. Upon acceptance of this Agreement as provided herein,
BUYER is granted the right to conduct reasonable tests on each of the wells
OPERATED by SELLER located on the PROPERTY for the purpose of confirming their
individual producing capacities. Such tests will be performed prior to Closing
and in the presence of SELLER'S agents, representatives or employees, who shall
be authorized to terminate or prohibit any test which, in their judgment, could
constitute a threat to the continued productivity of the well to be tested.
SELLER'S Engineering Manager, Tom Waller, Dallas, Texas, (214) 891-8472 should
be contacted prior to conducting such tests to apprise BUYER the name and
telephone number of SELLER'S agent, representative or employee, who shall be
authorized to witness same.
BUYER shall give SELLER written notice of an unsatisfactory well test not
later than ten (10) business days prior to Closing, together with the basis for
such assertion and data in support thereof, and shall furnish SELLER with any
proposed reduction in the Sales Price attributable to each such matter. SELLER
may remove the defective PROPERTY from the sale, attempt to cure the defect at
SELLER'S sole cost and expense, agree to a mutually acceptable Purchase Price
reduction or terminate this Agreement without liability to BUYER except for
return of the Performance Deposit.
20. NORM, RCRA AND CERLA After the execution of this agreement, BUYER
and its authorized representatives shall have physical access to the PROPERTY,
at BUYER'S sole cost, risk and expense for the purpose of inspecting the
PROPERTY, conducting such tests, examination, investigations and assessments as
may be reasonable and necessary or appropriate to evaluate environmental
conditions of the PROPERTY, including without limitation, for the purpose of
detecting the presence or concentration of naturally occurring radium, thorium
or other such materials (hereinafter referred to as "NORM"). Buyer shall
obtain permission from the operators to conduct such inspections. BUYER shall
defend and indemnify SELLER from any and all liability, claims, causes of
action, injury to agents or contractors or to BUYER'S property and/or injury to
SELLER'S property, employees, agents or contractors which may arise out of
BUYER'S inspections, but only to the extent of BUYER'S negligence. BUYER
should satisfy itself as to the physical and environmental condition, both
surface and subsurface, of the PROPERTY. SELLER disclaims all liability
arising in connection with the presence of environmental conditions such as,
but not limite and acknowledges that it has all the necessary licenses under
applicable state and federal law to accept assignment of the PROPERTY.
Subject to the other provisions of this section, at Closing, BUYER shall
assume and be responsible for and comply with all duties and obligations of
SELLER, express or implied, arising on or after the Effective Date with respect
to the PROPERTY, including, without limitation, those arising under or by
virtue of any lease, contract, agreement, document, permit, applicable statute
or rule, regulation or order of any governmental authority specifically
including, without limitation, any governmental request or requirement to plug,
re-plug and/or abandon any well of whatsoever type, status or classification or
take any clean-up or other action with respect to the PROPERTY or premises,
including hazardous waste cleanup costs under the Resource and Recovery Act
("RCRA") and the Comprehensive Environmental Response, Compensation and
Liability Act ("CERLA"), or similar laws, rules or regulations and defend,
indemnify and hold SELLER harmless from any and all claims arising out of or in
connection therewith.
If BUYER discovers a material environmental condition which would
adversely affect the value of the PROPERTY by fifteen percent (15%) or more per
defect net to SELLER'S interest in the affected PROPERTY and SELLER is not in
compliance with environmental laws, rules and regulations with respect to such
PROPERTY ("Environmental Defect") BUYER shall give SELLER written notice
thereof not later than ten (10) business days prior to Closing, together with
the basis for such assertion and data in support thereof, and shall furnish
SELLER with any proposed reduction in the Sales Price attributable to each such
matter. SELLER may remove the defective PROPERTY from the sale, attempt to
cure the defect at SELLER'S sole cost and expense within one hundred twenty
(120) days after the notice, agree to a mutually acceptable purchase price
reduction or terminate this Agreement without liability to BUYER except for
return of the Performance Deposit. If SELLER is unable to cure the defect, the
allocated value shall be refunded to BUYER and the defective PROPERTY
reassigned to SELLER effective as of the Effective Date.
21. ALLOCATED VALUES. BUYER AND SELLER herein agree upon the allocation
of the Purchase Price among the properties. Such Allocated Values are shown on
Exhibit "A", Property Schedule which is attached hereto. In the event the net
amount of the Purchase Price adjustments downward provided for in paragraphs
numbered 9, 16, 19, and 20 exceeds thirty percent (30%) of the Purchase Price,
then SELLER or BUYER may, upon written notice to the other, cancel this
Agreement and the same shall be of no fevent, SELLER shall promptly refund to
BUYER the Performance Deposit.
22. COMPLETE AGREEMENT; SAVINGS CLAUSE. When executed by SELLER and
BUYER, this Agreement shall constitute the complete agreement between the
parties regarding the purchase and sale of the PROPERTY. Where applicable, the
terms of this Agreement shall survive the Closing.
23. GOVERNING LAW AND VENUE. This Agreement and all of its terms and
provisions shall be governed by the laws of the State of Texas.
The parties agree that venue for any dispute between the parties
pertaining to this Agreement shall be in Dallas County, Texas. In any such
dispute, the prevailing party shall be entitled to reimbursement of all court
costs and reasonable attorneys' fees incurred.
24. FURTHER ASSURANCES. SELLER agrees that, at any time and from time to
time after the date hereof, it will, upon request of BUYER, execute,
acknowledge and deliver or cause to be executed, acknowledged and delivered all
further documents or instruments as may be required in connection with the
assignment and conveyance of the PROPERTY to BUYER; and SELLER shall perform
and take such actions as may be necessary or appropriate in connection with the
performance by SELLER of the transactions contemplated by this Agreement.
25. MISCELLANEOUS PROVISIONS.
(a) Captions have been inserted for reference purposes only and shall not
define or limit the terms of this Agreement;
(b) If any provision of this Agreement is held invalid, such invalidity
shall not affect the remaining provisions;
(c) This Agreement cannot be modified or amended except by a written
instrument duly executed by SELLER and BUYER; and
(d) Neither SELLER nor BUYER, without the prior written consent of the
other party shall assign any right or obligations under this Agreement prior to
the Closing, or attempt to delegaour understanding of our agreement, please so
indicate by dating, signing and returning one copy hereof on or before August
19, 1996. Failure to do so shall result in cancellation of this agreement at
SELLER'S option.
EXECUTED this 12th day of August, 1996.
MAYNARD OIL COMPANY
By: /s/ L. B. Carruth
___________________________
L. B. Carruth
Vice President
75-1362284
Tax Identification Number
CHATHAM OIL COMPANY
By: /s/ Jimmy R. Chatham
___________________________
Jimmy R. Chatham, Owner
###-##-####
Tax Identification Number
14490
Producer's OTC Reporting Number
EXHIBIT "A"
PROPERTY SCHEDULE
Attached to and made a part of PURCHASE AND SALE AGREEMENT dated
August 12, 1996, by and between Maynard Oil Company, SELLER, and
Chatham Oil Company, BUYER
CARTER COUNTY, OKLAHOMA
PN 440104, 440105 AND 440106
ALLOCATED VALUE $390,000.00
DEXTER-GREGG-HALE
EXPENSE INTEREST 1.0000000
REVENUE INTEREST 0.7656250
Oil and Gas Lease dated March 5, 1920, by and between Joseph H. Jennings
and Estella Jennings, as Lessor, and C. C. Lynch, as Lessee, recorded in Volume
43, page 398 of the Records of Carter County, Oklahoma, covering the NE/4 SW/4
SE/4, SE/4 NW/4 SE/4, W/2 SE/4 SE/4, SW/4 NE/4 SE/4 and the E/2 SE/4 SE/4 of
Section 28, Township 1 South, Range 3 West, Carter County, Oklahoma, LIMITED to
rights from the surface down to 3,800 feet below the surface. (LF-04842-00)
The hereinabove referenced lease is subject to Casinghead Gas Contract dated
August 25, 1956, by and between Signal Oil and Gas Company, as Buyer, and J. E.
Jackson, et al, as Seller; Operating Agreement dated February 18, 1965, by and
between Shell Oil Company, as Operator, and Loyd Benefield, et al, as Non-
Operators; Purchase and Sale Agreement dated December 19, 1985, by and between
Shell Western E&P Inc. and Maynard Oil Company; Assignment, Conveyance and Bill
of Sale effective December 1, 1985, by and between Shell Western E&P Inc. and
Maynard Oil Company recorded in Volume 1226, page 250 of the Records of Carter
County, Oklahoma.
PN 440125 (UT-474)
ALLOCATED VALUE $30,000.00
A. K. FRENCH NO. 1
BEFORE PAYOUT EXPENSE INTEREST 0.5000000
BEFORE PAYOUT REVENUE INTEREST 0.3750000
AFTER PAYOUT EXPENSE INTEREST 0.3750000
AFTER PAYOUT REVENUE INTEREST 0.3281250
Oil and Gas Lease dated February 26, 1926, by and between C. F. Adams, et
al, as Lessor, and Marguerite Noble, as Lessee, recorded in Volume 75, page 417
of the Miscellaneous Records of Carter County, Oklahoma, INSOFAR AND ONLY
INSOFAR as said lease covers the SE/4 SE/4 of Section 3, Township 2 South,
Range 3 West, Carter County, Oklahoma, AND INSOFAR AND ONLY INSOFAR as said
lease covers rights from the top of the Sycamore Formation down to the
stratigraphic equivalent of 9,210 feet, as identified in the A. K. French No. 1
well, located in the SE/4 SE/4 of Section 3, Township 2 South, Range 3 West,
Carter County, Oklahoma. (LF-05512-00)
The lease hereinabove referenced lease is subject to Farmout Agreement D-271-89
dated June 20, 1989, by and between Mobil Exploration & Producing U.S. Inc., as
Farmor, and Maynard Oil Company, as Farmee, by Letter Agreement dated September
19, 1989, as amended, by and between Maynard Oil Company and Mobil Exploration
& Producing U.S. Inc.; Letter Agreement dated July 19, 1989, by and between
Maynard Oil Company and Chesapeake Production Company; and Operating Agreement
dated September 8, 1989, as amended, by and between Maynard Oil Company, as
Operator, and Atlantic Richfield Company, et al, as Non-Operators, by Letters
of Agreement dated September 20, 1989, by and between Maynard Oil Company and
Atlantic Richfield Company, et al; Oklahoma Corporation Commission Spacing
Order No. 98237 (C.D. 36732) for the Sycamore Common Source of Supply; Oklahoma
Corporation Commission Spacing Order No. 344506 (C.D. 152117) for the Woodford
Common Source of Supply.
PN 440123 (UT-472)
ALLOCATED VALUE $24,444.00
H. W. WILLIAMSON AKA WILLIAMS NO. 1
EXPENSE INTEREST 0.5000000
REVENUE INTEREST 0.3750000
Oil and Gas Lease dated February 26, l926, by and between C. F. Adams, et
al, as Lessor, and Marguerite Noble, Lessee, recorded in Book 75, page 417 of
the Miscellaneous Records of Carter County, Oklahoma, INSOFAR AND ONLY INSOFAR
as said lease covers the NE/4 SE/4 of Section 3, Township 2 South, Range 3
West, Carter County, Oklahoma, LIMITED in depth from the top of the Sycamore
formation down to the stratigraphic equivalent of 8,688 feet, as identified in
the H. W. Williamson No. 1 well, located in the SW/4 NW/4 SE/4 of Section 3,
Township 2 South, Range 3 West, Carter County, Oklahoma. (LF-05512-00)
The hereinabove referenced lease is subject to Oklahoma Corporation Commission
Spacing Order No. 98237 (C.D. 36732) for the Sycamore Common Source of Supply;
Oklahoma Corporation Commission Spacing Order No. 344506 (C.D. 152117) for the
Woodford Common Source of Supply; Farmout Agreement D-271-89 dated June 20,
1989, by and between Mobil Exploration & Producing U.S. Inc., as Farmor, and
Maynard Oil Company, as Farmee, and Operating Agreement dated August 2, 1989
(effective July 19, 1989), by and between Maynard Oil Company, as Operator, and
Atlantic Richfield Company, as Non-Operator; and Letter Agreement dated August
9, 1989, by and between Maynard Oil Company and Mobil Exploration & Producing
U.S. Inc.
EXHIBIT "B"
ASSIGNMENT AND BILL OF SALE
FROM MAYNARD OIL COMPANY
TO CHATHAM OIL COMPANY
Attached to and made a part of PURCHASE AND SALE AGREEMENT dated
August 12, 1996, by and between Maynard Oil Company, SELLER, and
Chatham Oil Company, BUYER
THE STATE OF )
) KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF )
THAT, the undersigned, MAYNARD OIL COMPANY, a Delaware corporation, with
offices at 8080 North Central Expressway, Suite 660, Dallas, Texas 75206,
hereinafter called "Assignor", for and in consideration of Ten Dollars ($10.00)
and other valuable consideration to it in hand paid by JIMMY R. CHATHAM, an
individual doing business as CHATHAM OIL COMPANY, whose address is in care of
the First National Bank & Trust Company, P. O. Box 69, Ardmore, Oklahoma 63402,
hereinafter called "Assignee", does hereby TRANSFER, ASSIGN and CONVEY unto
Assignee, WITHOUT WARRANTY OF TITLE EITHER EXPRESS OR IMPLIED, EXCEPT BY,
THROUGH AND UNDER ASSIGNOR, BUT NOT OTHERWISE, with the right of full
substitution and subrogation in and to all rights and actions of warranty which
Assignor has or may have against any and all preceding owners of the said
leases, subject to the terms and conditions contained herein, the following:
(a) All of Assignor's rights, titles and interests in and to the
leasehold estates described in Exhibit "A", such leases being hereinafter
called "said leases", represented to be no less than the working and net
revenue interests set forth therein, subject to all burdens, encumbrances,
contracts and agreements, which are of record and/or listed in Exhibit "A"
affecting said leases to the extent that same are in force and effect;
(b) All of SELLER'S royalties, overriding royalties, production payments,
rights to take royalties in kind, or other interests in production of oil, gas
or other minerals;
(c) All of Assignor's rights, titles and interests in and to all permits,
franchises, licenses, servitudes, easements, surface leases and rights-of-way
of every character relating to said lease;
(d) All of Assignor's rights, titles and interests in and to any
contracts or agreements including, but not limited to, rights and interests in
or derived from unit agreements, gas processing agreements, joint operating
agreements, gas contracts, gas gathering agreements, gas balancing agreements,
boundary or well line agreements, assignments of operating rights, working
interests and subleases affecting said leases.
For the same consideration, Assignor does hereby BARGAIN, SELL and DELIVER
unto Assignee all of its rights, titles and interests in and to the wells
located on said leases described in said Exhibit "A"; and Assignor does hereby
further BARGAIN, SELL and DELIVER unto Assignee all of its rights, titles and
interests in and to all personal property and well equipment located in, on and
used in connection with the said leases, such well, personal property and the
well equipment being hereinafter collectively called "said wells". ASSIGNOR
EXPRESSLY DISCLAIMS AND NEGATES (a) ANY IMPLIED OR EXPRESS WARRANTY OF
MERCHANTABILITY, (b) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE, and (c) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO
MODELS OR SAMPLES OF MATERIALS. ASSIGNEE EXPRESSLY WAIVES THE PROVISIONS OF
CHAPTER XVII, SUBCHAPTER E, SECTIONS 17.41 THROUGH 17.63, INCLUSIVE (OTHER THAN
SECTION 17.555, WHICH IS NOT WAIVED), VERNON'S TEXAS CODE ANNOTATED, BUSINESS
AND COMMERCIAL CODE.
This Assignment and Bill of Sale is executed and delivered as part of the
consummation of the transaction contemplated by that certain Purchase and Sale
Agreement between Assignor, as SELLER, and Assignee, as BUYER, dated August 12,
1996, hereinafter referred to as "Sale Agreement". The warranties,
representations, indemnities and covenants contained in the Sale Agreement
shall survive the delivery of this Assignment in accordance with the provisions
of the Sale Agreement and the delivery of this Asswise impair any of the
warranties, representations, indemnities or covenants made in the Sale
Agreement and the terms and conditions set forth therein; provided, however,
any third parties transacting with Assignee with respect to any of the
Interests may rely on this Assignment as vesting Assignee with all of
Assignor's rights, titles and interests in the said leases and wells.
This Assignment and Bill of Sale shall extend to, be binding upon and
inure to the benefit of Assignor and Assignee, their respective successors and
assigns and shall be deemed covenants running with the herein described lands
and leasehold estates.
Assignee expressly assumes, as of the Effective Date, all of Assignor's
obligations relating to the said leases, including, but not limited to, the
obligation of plugging and abandoning any well on the said leases, at
Assignee's sole cost, risk and expense.
This assignment shall be effective, for all purposes as of 7:00
o'clock a.m. August 1, 1996.
EXECUTED by Assignor and Assignee in Duplicate Originals on this ____
day of _______________, 1996, but to be effective as stated above.
MAYNARD OIL COMPANY
By: ___________________________
Glenn R. Moore
President
CHATHAM OIL COMPANY
By: ___________________________
Jimmy R. Chatham, Owner
THE STATE OF TEXAS )
)
COUNTY OF DALLAS )
This instrument was acknowledged before me on __________, 1996,
by Jimmy R. Chatham, Owner.