ASSIGNMENT OF OIL, GAS AND MINERAL LEASES
AND BILL OF SALE
STATE OF LOUISIANA SECTION
SECTION KNOW ALL MEN BY THESE PRESENTS:
PARISH OF CLAIBORNE
THAT TEXSTAR PETROLEUM, INC., hereinafter referred to as "Assignor,"
whose address is 1000 Louisiana, Suite 1500, Houston, Texas 77002, for and in
consideration of One Hundred Dollars ($100.00) and other good and valuable
consideration of which are hereby acknowledged, does hereby grant, bargain,
sell, convey, assign, transfer, set over and deliver unto FAULCONER RESOURCES
1999 LIMITED PARTNERSHIP, a Texas limited partnership, hereinafter referred
to as "Assignee," whose address is P.O. Box 7995, Tyler, Texas 75711, all of
its right, title and interest in and to the following properties and rights:
(a) The oil, gas and mineral leasehold and fee estates (including all
working interests, farmout rights, royalty, overriding royalty or other
non-working or carried interests and operating rights or other mineral rights
of every nature), described in Exhibit "A" attached hereto and made a part
hereof, together with all wells located on the described leases and all of
Assignor's rights incident thereto (the "Subject Properties");
(b) All of Assignor's right, title and interest (including without
limitation, leasehold) in and to all wells, equipment, supplies, machinery,
gathering pipelines, gas facilities, gathering systems, gathering storage,
distribution and disposal facilities, tanks and all other real or tangible
personal property and fixtures which are located on and appurtenant to the
lands covered by the leases described on Exhibit "A" attached hereto.
(c) All of Assignor's rights, title and interest in and to the oil, gas
and minerals produced on or after the Effective Date, all orders, contracts,
title opinions and documents, abstracts of title, leases, deeds, unitization
agreements, pooling agreements, conservation orders, operating agreements,
division of interest statements, participation agreements and all other
agreements and instruments associated or connected with the leasehold
conveyed hereby;
(d) All of Assignor's right, title and interest in and to all
easements, rights-of-way, licenses, authorizations, permits and similar
rights and interests, all warranties, covenants, indemnities and
representations from third parties, except as expressly provided herein; and
(e) All original or copies of all lease files, land files, well files,
oil and gas sales contract files, gas processing files, division order files,
abstracts, title files and materials, and all other books, files, maps, logs
and records (the "Records"), and all rights thereto, subject to the rights of
third parties, to the extent assignable and seismic, geologic, engineering
and geophysical records and data; and all other rights, privileges, benefits
and powers conferred upon the owner and holder of interest in the Subject
Properties.
This Assignment of Oil, Gas and Mineral Leases and Bill of Sale is
subject to the following terms, covenants and conditions:
1. This Assignment of Oil, Gas and Mineral Leases and Bill of Sale shall
become effective as of the 1st day of March, 1999, as of 7:00 a.m., local
time, regardless of the date of execution (the "Effective Date.")
2. The Subject Properties are subject to the lease royalties, overriding
royalties, production payments, net profits obligations, carried working
interests, and other payments out of or with respect to production which are
of record and with which the Leases are encumbered at the Effective Date
hereof. Assignee hereby assumes and agrees to perform all of the terms and
express and implied covenants and conditions of the leases and any intervening
assignments affecting same at the Effective Date.
3. With respect to the Subject Properties, Assignee hereby assumes and
agrees to timely perform and discharge all duties and obligations in
connection with the Subject Properties of the owner of the Leases and Wells
on and after the Effective Date hereof, including, but not limited to, the
obligation to properly plug and abandon the Wells, at Assignee's sole costs,
risk, and expense, in accordance with the applicable rules and regulations of
any authority having jurisdiction there over and to clean and restore the
surface of the land around the Wells in accordance with the terms of the
Leases. Assignor shall include no liability from Assignee's failure to perform
and discharge such duties and obligations in a timely manner.
4. With respect to the Subject Properties, Assignee shall be solely
responsible for any and all sales taxes which may be assessed by any taxing
authority as a result of this Assignment. Assignee shall hold Assignor
harmless from all such taxes and any interest and penalties thereon. All
other taxes, including, but not limited to, applicable ad valorem taxes,
excise taxes, severance and production taxes, and any other local, state, or
federal taxes or assessments attributable to the Leases and Wells, including
any deductions, credits, and refunds pertaining thereto, shall be apportioned
between Assignor and Assignee as of the Effective Date, and Assignor and
Assignee shall each indemnify and hold the other free and harmless from and
against any such taxes as apportioned, including interest and penalties
thereon.
5. Assignor, any parent company, subsidiary or affiliate, (including, but
not limited to, Benz Energy Ltd.), shall be responsible for all costs,
expenses, losses, claims, damages, demands, suits, causes of action and
liabilities pertaining to the Leases and Wells and the operation thereof
prior to the Effective Date. ASSIGNOR SHALL DEFEND, INDEMNIFY, AND HOLD
ASSIGNEE, INCLUDING BUT NOT LIMITED TO VERNON E. FAULCONER, INDIVIDUALLY,
VERNON E. FAULCONER, INC., FAULCONER CORPORATION, FAULCONER ENERGY JOINT
VENTURE-1990, FAULCONER ENERGY GENERAL PARTNER, L.L.C., and FAULCONER ENERGY
CORPORATION), ITS SUCCESSORS AND ASSIGNS, HARMLESS AGAINST SAME, INCLUDING
ANY COSTS AND EXPENSES FOR ATTORNEYS FEES.
Assignor, any parent company, subsidiary or affiliate, (including, but
not limited to, Benz Energy Ltd.), further hereby agrees to indemnify and
hold Faulconer Resources 1999 Limited Partnership, Vernon E. Faulconer,
individually, Vernon E. Faulconer, Inc., Faulconer Corporation, Faulconer
Energy Joint Venture-1990, Faulconer Energy General Partner, L.L.C., and
Faulconer Energy Corporation, its partners, affiliates, successors and
assigns from and against any royalty claims, expenses and costs attributable
and associated with any nonpayment of royalties and any recoupment of
erroneous payments made by Assignor prior to the Effective Date of this
Agreement.
Further, Assignor, any parent company, subsidiary or affiliate,
(including, but not limited to, Benz Energy Ltd.), shall defend Assignee and
the above-referenced parties harmless from and against any claims resulting
from the litigation and claims (including, but not limited to the claims and
mortgages) listed on Exhibit "B" attached hereto and made a part hereof.
2
6. All costs and expenses attributable to operations on the Subject
Properties prior to the Effective Date shall be borne by Assignor and all
costs and expenses attributable to such operations on or after the Effective
Date shall be borne by Assignee. All proceeds from production on the Subject
Properties attributable to sales made prior to the Effective Date shall
belong to Assignor and all proceeds attributable to such sales made on or
after the Effective Date shall belong to the Assignee. An accounting for all
production, proceeds, costs, and expenses belonging to or being borne by
Assignor or Assignee shall be had and all remittances and payments thereof
shall be made within sixty (60) days following the date of this Assignment.
Following such accounting, any funds received by, or costs or expenses billed
to, a party that belong to or should be borne by another party, shall be
promptly paid to or remitted by such other party.
Assignor hereby warrants and agrees to defend its title to the Leases as
to the acts done by, through or under Assignor, but no further. Assignee is
hereby substituted for and subrogated to all actions of warranty which
Assignor has or may have against any predecessors in title.
7. All equipment and other personal property appurtenant to the Subject
Properties is transferred subject to normal wear and tear and without
warranties of any kind whatsoever, whether expressed or implied, and are sold
"AS IS AND WITH ALL FAULTS AND DEFECTS" and "WITH NO WARRANTY AS TO
MERCHANTABILITY, FITNESS OR SUITABILITY FOR ANY PARTICULAR PURPOSE". THIS
ASSIGNMENT IS MADE (a) WITHOUT ANY WARRANTY OR REPRESENTATION OF TITLE,
EITHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, EXCEPT AS EXPRESSLY PROVIDED
HEREIN, (b) WITHOUT ANY EXPRESS, IMPLIED, STATUTORY OR OTHER WARRANTY OR
REPRESENTATION AS TO THE CONDITION, QUANTITY, QUALITY, FITNESS FOR A
PARTICULAR PURPOSE, CONFORMITY TO MODELS OR SAMPLES OF MATERIALS OR
MERCHANTABILITY OF ANY OF THE ASSETS OR THEIR FITNESS FOR ANY PURPOSE; AND
(c) WITHOUT ANY OTHER EXPRESS, IMPLIED, STATUTORY OR OTHER WARRANTY OR
REPRESENTATION WHATSOEVER. Notwithstanding the foregoing, should Assignee or
any of the above-referenced parties be required by any agency of the State of
Louisiana to remediate any pit on the Subject Properties not currently in
compliance with state regulations, the cost will be borne by Assignor or any
parent company, subsidiary or affiliate.
8. This Agreement is made by Assignor and accepted by Assignee subject to
all applicable laws, ordinances, rules and regulations, and Assignee agrees
to timely comply with same.
So long as not prohibited by applicable law to do so, Assignor and
Assignee and their respective successors an assignees, will do, execute and
acknowledge, and deliver all further acts, conveyances, transfer orders,
division orders, notices releases, and acquittances and such other
instruments as may be necessary or appropriate to assure more fully to each
party hereto, their respective successors and assigns, all of the respective
properties, rights, title, interest, estates, remedies, powers and privileges
conveyed or intended to be conveyed by this Assignment.
It is the intent of Assignor to convey and this Agreement hereby conveys
to Assignee subject to the reservations and conditions herein contained, all
of Assignor's right, title, and interest on the Effective Date hereof in and
to the lease and lands, regardless of the omission of any wells or leases,
errors in description, and incorrect or misspelled names or any transcribed or
incorrect recording references.
The provisions hereof shall be covenants running with the land and shall
insure to benefit of and be binding upon Assignor and Assignee, their
respective personal representatives, successors and assigns.
EXECUTED this 26 day of April, 1999, but to be effective as of March 1,
1999. -- ------
WITNESS: ASSIGNOR:
/s/ Thomas William TEXSTAR PETROLEUM, INC.
/s/ Dee Dee Cottrell
BY: /s/ Todd Grabois
--------------------------------
TODD GRABOIS
Vice President
WITNESS ASSIGNEE:
/s/ Dee Dee Cottrell FAULCONER RESOURCES 1999 LIMITED PARTNERSHIP
/s/ Becky Glover
BY: FAULCONER ENERGY GENERAL PARTNER,
L.L.C., a Louisiana limited liability
company, its general partner
BY: FAULCONER ENERGY CORPORATION,
ATTEST: its sole member
BY: /s/ Jean Crawley BY: /s/ Philip H. Jensen
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JEAN CRAWLEY PHILIP H. JENSEN
Secretary Vice President
THE STATE OF TEXAS SECTION
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COUNTY OF SMITH SECTION
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BEFORE ME, the undersigned, a Notary Public in and for the county and
state aforesaid, personally appeared, TODD GRABOIS to me personally known,
who being by me duly sworn, did say that he is the Vice President of TEXSTAR
PETROLEUM, INC. and that said instrument was signed on behalf of said
corporation by authority of its Board of Directors and the said TODD GRABOIS
acknowledged said instrument to be the free act and deed of said corporation
for the uses and purposes therein set forth.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 26th day of April, 1999.
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My Commission Expires:
7-21-01 /s/ Maureen Raney
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Notary Public
MAUREEN RANEY
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Printed Name
- --------------------------------
MAUREEN RANEY
[SEAL] Notary Public
STATE OF TEXAS
My Comm. Exp. 7-21-2001
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THE STATE OF TEXAS
COUNTY OF SMITH
BEFORE ME, the undersigned, a Notary Public in and for the county and
state aforesaid, personally appeared, PHILIP H. JENSEN to me personally
known, who being by me duly sworn, did say that he is the Vice President of
FAULCONER ENERGY CORPORATION, sole member of Faulconer Energy General
Partner, L.L.C., general partner of FAULCONER RESOURCES 1999 LIMITED
PARTNERSHIP and that said instrument was signed on behalf of said corporation
by authority of its Board of Directors and the said PHILIP H. JENSEN
acknowledged said instrument to be the free act and deed of said corporation
for the uses and purposes therein set forth.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this the 23rd day of April, 1999.
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My Commission Expires:
7-21-01 /s/ Maureen Raney
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Notary Public
MAUREEN RANEY
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Printed Name
- --------------------------------
MAUREEN RANEY
[SEA] Notary Public
STATE OF TEXAS
My Comm. Exp. 7-21-2001
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