HomeMy WebLinkAboutContract 48808CITY SECRETqR�'
OIL AI�I) GAS L�AS� ���CTNO, ��L� ��
�x� s�A�� oF T�xas §
§
co��r�•� o� ���ta�r�r §
THIS AGRE�NY�Io1T ("Lease") is made and entered into as of the date herein specified by and
between- CITY OF FORT �VORTH, a home rule municipal corporation of the State of Te�as located
within Tari•ant, Denton, and Wise Counties, Texas, (hei•einafter referred to as "Lessoy"), and, V�ntage
Fort `Vorth �nergy, LI,C, a Dela�vare Limited Li�bility Company (hereinafter refecred to as
"Lessee").
WIT'N�SS�'I'H:
f�
GRANTING CLAUS�
Lessor, in consideration of a cash bonus in hand paid, of the royalties herein provided, and of the
a�reements of Lessee hei•einafter contained, hereby gi•ants, leases, and lets eYclusively unto Lessee fot• the
sole purpose of i�ivestigating, e�ploi•ing, drilling, operating, and pi•oduciiig oil and/or gas fi•om the land
leased hereunder, together �vith any liquid or gaseous substances produced in association �vith oil and gas,
the following described land situated in the City of Foi-t Worth, Tesas described in E�chibit "A" attached
hereto (the "leased premises").
All mineral st►bstances and minei•al i•ights other tlian oil and gas (and all other liquid or gaseous
minerals produced in association with oil or gas) are eYpressly reserved to Lessor and elcepted fi�om this
Lease. These i•eserved mineral rights include, but are tiot limited to, the rights to lignite, coal and sulfi�r
not pi•oduced as a component of oil a�id gas.
For the pu�pose of determining the amount of any bonus or other payment hereunder, said leased
premises shall be deemed to contain 3.366 acres, whether achially containing more or less:-- '--- —_==_- __—
'� ��'FICIAL RECORD
2. CITY �ECRETARY
PRIi'VIARY TERIVI � p�', �l���n�a .��
Siibject to tlle other provisiotis l�ei•ein contained, this Lease sliall be foi• a term of t�vo (2) yeai•s---
1 OIL AtiD GAS LEASE— �'_'00 and 5300 E Rosedale Street
fi•om the date of the notarial ackno�vledgment of Lessor's eYecution of this instrument (hereinafter called
"primary term") and so long thereafter as oil, gas or other minerals granted herein are produced from the
leased premises or lands pooled there�vith, in paying quantities, o►• operati�iis are in progress thereon as
hereinafter• pi•ovided, and tlie royalties are paid as pr•ovided (lerein. Foi• the purposes of this lease, tlle ter•in
"opet•ations" means any of the following: d►•illing, testing, completing, i•ewor•king, recompleting,
deepening, plugging back, or repairing of a well iu searcl� for or in the endeavor to obtain production of
oil or gas, so long as such operations are cat•ried out �vith due diligence with no cessation of more than
ninety (90) consecutive days.
3.
DELAY R�NTALS
'This is a paid-up lease and no delay rentals are due. Upon termination, Lessee shall prepare,
execute and deliver to Lessor a recordable release covering the leased premises in accordance �vith this
Lease. Lessee may at any time or times esecute and deliver to Lessor, a release or releases of this Lease
as to all or any part of the leased premises, and thereby be relieved of all obligations as to the released
land or interest, except for the indemnification obligations described in Paragraph 16 and the pluggin�
obligations of tt�is Lease,
4.
ROYALTI�S
Lessee shall pay to Lessor the following royalties, �vhich shall be fi�ee of all costs of any kind,
including, but not limited to, costs of gathering, production, transportation, treating, compression,
dehydration, processing, marketing, t�ucking or other espense, directly or indirectly incurred by Lessee,
�vhethec as a direct chat•ge or a ceduced price or othei•wise. In this �•egard, Lessee agrees to bear• one
hundred percent (100%) of al1 costs and e�penses incurred iu rendering hydrocarbons produced on or
fi•om the leased premises marketable and delivering the same into the pui•chaser's pipeline for immediate
transportation to an end usei- or stoi•age facility. Additionally, said royalties shall never bear, either
directly or indii•ectly, itndei• any cit�ctimstances, the costs or etipenses (incltiding depi•eciation) to
2 OIL AND GAS LEASE -- �200 and 5300 E. Rosedale Street
construct, repair, renovate or operate any� pipeline, plant, or other facilities or equipment used in
connection with the treating, separation, e�traction, gathering, processing, refining, compression,
transporting, manufacturing or marketiug of hydrocarbons produced fi•om the leased premises or lands
pooled thei•ewith.
A. On oil, gas (including fla��ed gas) and casinghead gas, together �vith aiiy other liquid or
gaseous hydrocarbons recovered by Lease operations (such as in drips or separators) twenty-five
percent (25%) of the proceeds of the sale or of the market value thereof, whichever is higher. Such
proceeds of oil, gas and casinghead gas, together• with any other liquid or gaseous hydi•ocarbons
recovered by Lease operations, is to be delivered fi•ee of cost at the well or to the credit of the Lessor
into pipelines, gathering lines, barges or other facilities to �vhich the wells and tanks on the property
may be connected. Lessor shall al�vays have the right, at any time and fi•om time to time, upon
reasonable written notice to Lessee, to take Lessor`s share of oil, gas and processed liquids in kind.
Lessor may elect to take Lessor's gas in kind at the well, or at the point of delively where Lessee
delivei•s Lessee's gas to any third party. If gas is processed, Lessoi• may elect to take Lessor's share of
the residue gas attributable to production fi•om the leased premises, at the same point of deliveiy �vhere
Lessee receives its share of residue gas or has its share of residue gas delivered to a thirci party. Lessor
may elect to have its royalty share of pi•ocessed liqtiids stoi•ed in tanks at the plant or delivered into
pipelines on the same basis as Lessee's shar�e of liquids is stored or delivered. Lessor shall reimburse
Lessee for all i•easonable costs incui•red by Lessee in installing, operatin� oi• maintaining additional
facilities necessa�y for Lessor•'s royalty gas and processed liquids to be separately tnetered, accounted
for, and delivered to a third party, but Lessor shall not be char•ged for any eYpense in the pl•oduction,
gathering, dehydration, separation, compression, transportation, treatment, processing or storage of
Lessor's share of gas and processed liquids.
B, On pi•oducts, nventy five pei•cent (25%) of the gross market value oi• proceeds of sale
thereof; whichever is higlier.
C`. On residue gas o�• gas remaining after separation, estraction or processing opei•ations,
3 OIL AND GAS LEASE — 5200 and �300 E. itosedale Street
riventy five percent (25%) of the proceeds of sale or of the market value thereof, whichever is higher.
D. For pui•poses of this Pai•agi•aph 4, the term "mai•ket value" shall mean for gas and
products therefi•om (i) the gross price at which gas or products therefi•om are sold pursuant to a Gas
Contract, as defi�ied below, that is ratified by Lessor accoi•ding to Paragt•aph G belo�v oi• (ii) if not sold
pui•suant to a Gas Contract, as defined belo��, i•atified by Lessoi• and Lessee, the highest gi•oss pi•ice
reasonabty obtainable for the quantity of gas or products available for sale, through good faith
negotiations for gas or products produced $•om the leased premises at the place where such gas or
product is available for sale on the date of such a contract with adequate provisions fot• redeter•mination
of price at intervals of no less fi•equency than one (1) year to ensure that the production is being sold for
no less than the cui•rent mar•ket pi•ice, Included withili the definition of "Mai•ket Value" as used herein is
the peesumptio�l that Gas Contracts that are catified by Lessor• are arms-length contracts �vith purchasers
who are not affiliates of Lessee. An "af�iliate" includes, but is not limited to, the par•ent company or a
subsidiary of Lessee, a corporation or other entity having common ownership �vith Lessee, a partner or
joint venturer of Lessee with respect to the ownership or opei�ation of the processing plant, a corporation
oi• other entity in �vhich Lessee o�vns a ten percent or greatei• intel•est, oi• any individual, corporation oi•
othei• entity that o�vns a ten perceiit or• greater intet•est iti Lessee. In no event shall "market value" ever
be less than the amount actlially received by the Lessee for the sale of hydrocarbons.
E. This Lease is intended to cover only oil and gas, but some other substances (inchiding
helium and sulphur) may be produced necessarily with and incidental to the production of oi] or gas
fc�om the leased premises; and, in such event, this Lease shall also cover all such other substances so
produced. On all such substances so pi•oduced under• and by virtue of the terms of this Lease, Lessoi•
shall receive a r•oyalty of twenty five percent (25%) of all stich stibstances so produced and saved, same
to be delivered to Lessor, fi•ee of all costs; oc, at Lessot�'s election, Lessor's twenty five percent (25%) of
such substances shall be sold b}� Lessee with Lessee's pol�tion of such st�bstances and at the same pr•ofit
realized by Lessee for its pot�tion of such substances.
F. All r•oyalties hel•einabove pi•ovided shall be payable in cash (unless Lessor elects to take
� OIL AND GAS LEASE — 5200 �nd �300 F 2osedale Street
such royalty oil or gas in kind) to Lessor within siYty (60) days follo�ving the first commercial sale of
production and thereafter no mot•e than siYty (60) days after the end of the month follo�ving the month
during which production takes place. Subject to the provisions of Paragraph 10 of this Lease
concerning shut-in wells, royalties shall be paid to Lessor by Lessee and/or its assigns or by the product
purchaser for oil and/or gas. Upon the failure of any party to pay Lessor the royalty as provided in this
paragraph, Lessor may, at Lessor's option, elect to terminate this Lease by seuding written notice to
Lessee. Lessee shall then have thirty (30) days fi•om the date of service of such written notice in which
to avoid termination of this Lease by making or causing to be made the proper royalty payment or
payments that should have been paid. If such royalty payment is not made ou or before the espiration of
the 30-day period, or written approval is not obtained fi•om Lessor to defer such payment, Lessor may
elect to terminate this Lease by filing a Notice of Termination with the County Clerk in the county
��here the leased premises are located. The effective date of said termination shall be the date said
Notice of Termination is filed with the said County Clerk.
G, Lessee agrees that it will not enter into any contract for the sale, deliveiy, transporting or
processing of gas produced fi•om the leased premises which shall eYtend more than nvo (2) years from
the effective date of such sales contract unless such conh•act has adequate provisions for redetermination
of price at intervals of no less fi•equency than one (1) year to enstu�e that production fi•om this Lease is
not being sold for less than the then curi•ent market vahie. At least thirty (30) days prior to the deliveiy ol•
the e�ecution of any contract for the sale, delively, transpoi�ting or processing of gas pt•oduced from the
leased prernises, Lessee shall pcovide Lessor with a complete copy of each proposed contract for the
purchase, transportation and/or processing of such gas that Lessee intends to eYecute (each a"Gas
Contract"), whereupon, Lessor shall have fifteen (15) days within �vhich to either ratify such Gas
Contract or notify Lessee in writing that it does not approve of such Gas Contract, including a statement
of the reasons that Lessor does not approve of such Gas Contract (Lessoi•'s failui•e to i•espond within the
fifteen (15) days either by ratification or by written notice that it does not approve of the proposed Gas
Conti•act shall be deetned to be Lessor's catification of such Gas Contract). If Lessor ratifies the Gas
j OIL AND GAS LEASE — 5200 and 5300 E. Rosedlle Street
Coiiti•act, Lessoi• shall be deemed bound by the terms of st►ch Gas Contl•act (and, at Lessee's option,
Lessor shall execute such Gas Contract as a party thereto) and the gas or products therefrom sold
pursuant to such Gas Contract shall be deemed sold at macket value based on the gross price stated
therein. Lessee shall not amend oi• modify any material terms of a Gas Contract i•atified by Lessoi•
�vithout the pi•ior wi•itten consent of Lessoi•. If Lessoi• does not appi•ove of a Gas Conti•act, Lessee shall
consult with Lessoi• in an effort to agree to t(ie terms of the proposed Gas Conti•act, and if the othei• party
or parties to the Gas Contract agree to the changes or modifications to the Gas Contract which are
pi•oposed by Lessoi• in order for Lessoi• to 1•atify such Gas Conti•act, then Lessor shall be deemed to have
ratified such Gas Contract (and, at Lessee's option, Lessor shall eYecute such Gas Contract as amended
and modified, as a party thereto). If Lessor and Lessee cannot a�ree on the terms of a Gas Contract that
are acceptable to the other party or pa►�ties thereto, Lessee may elect to eYecute such Gas Contract and
sell, deliver, h•anspoi�t and process gas accordirig to the terms thereof, subject to the other terms of this
Paragraph 4 concerning the payment of Lessor's royalty arl gas and products there fi•om, including the
right of Lessor to take its shai•e of gas in knid. I�i the event Lessor elects to take and sepai•ately dispose
of its royalty share of gas, the pa►�ties shall enter into a mutually acceptable bzlancing agreement
providing for (a) the r•ight of an undei• produced party to make up an imbalance by taking up to 150
pei•cent of its share of production and (b) an obligation to settle any imbalance remaining after depletion
in cash, based on the proceeds received by the ovel•produced pai•ty �vhen the imbalance �vas created, ol•
if the overproduced party's gas was used but not sold, based on the macket value of the gas when
irnbalance �vas created.
H. In the event Lessee enters into a gas purchase conh•act which contauis �vhat is commonly
referred to as a"take or pay provision" (such provision meaning that the gas purchaser agrees to take
delive�y of a specified minimiun volume or quantity of gas over a specified term at a specified price or
to make minimum periodic payments to the producer for gas not taken by the purchasei•) and the
purchaser under such gas purchase conri•act makes payment to Lessee by virtue of such purchaser's
failure to take deliveiy of such minimum volume or quantity of gas, then Lessor shall be entitled to
6 011. AND CiAS LEASE — i200 nnd 5300 E. Rosedale Street
t�venty �ve percent (25%) of all such sums paid to Lessee or producer under the "pay" provisions of
such gas ptu•chase contract. Such royalty payments shall be due and owing to Lessor within thirty (30)
days after the receipt of such payments by Lessee. If the gas purcl�ase►• "makes up" such gas �vithin the
period called for in the gas contract and Lessee is ►•equired to give such purchasei• a ci•edit for gas
previously paid for but not taken, then Lessor shall not be entitled to royalty on such "make up" gas. If
Lessee is not producing any quantities of gas from the leased premises but is receiving payments under
the "pay" portion of such "take or pay" gas purchase contract provision, such payments shall not relieve
Lessee of the duty to make shut-iii royalty payments if Lessee desires to continue this Lease, but such
"take or pay" royalty payments shall be applied as a ci•edit against any shut-in royalty ob(igation of the
Lessee. Lessor shall be a third-party beneficiary of any gas purchase contract and/or transportation
agreement entered into between Lessee and any pui•chaser and/or transpoirter of Lessor's gas,
irrespective of any provision of said contracts to the contr•aiy, and such gas pui•chase contract and/or
transpoi�tation agreement will expressly so provide. Further, Lessor shall be entitled to tcventy-five
percent (25%) of the value of any benefits obtained by or gcanted to Lessee fi•om any gas purchaser
and/or transpoi�ter for the amendment, modification, eYtension, alteration, consolidation, transfer,
cancellation or settlement of any gas purchase contract and/or transportation agreement.
L Lessee agrees that before any gas produced fi•om the leased premises is used or sold off
the leased premises, it will be run, fi�ee of cost to Lessor, through an adequate oil and gas separator of a
conventional type or equipment at least as efficient, to the end that all liquid hydrocarbons t•ecoverable
from the gas by such means will be recovered and Lessor properly compensated therefor.
J. Any payment of royalty or shut-in gas royalty hereunder paid to Lessor in escess of the
atnount actually due to the Lessor shall nevet�theless become the property of the Lessor if Lessee does
not make �vritten request to Lessor for reimbursement within one (1) year fi•om the date that Lessor
received the erc•oneous payment, it being agreed and expressly understood between the parties hereto
that Lessor is not the collecting agent for any other royalty o�vner under the lands covered hereby, and a
detei•mination of the name, interest ownership and whereabouts of any person entitled to any payment
7 OIL AND GAS LEASE —�200 and 5300 E. Roszdale Street
whatsoever under the terms hereof shall be the sole responsibility of Lessee. It is furthei• eYpressly
agreed aud understood that: (i) this provision shall in no way diminish the obligation of Lessee to make
fiill and punctual payments of all amounts due to Lessor or to any other• person under the terms and
pi•ovisions of this Lease, and (ii) any ovei•�ayments made to the Lessoi• under• any provisions of this
Lease shall not be entitled to be offset against future amounts payable to parties hereunder.
IC. The terms of this Lease may not be amended by any division order and the signing of a
division ordei• by any minet•al ownei• may not be made a pi•ei•equisite to payment of royalty hei•eunder.
L. Oil, gas or products may not be sold to a subsidia►y or affililte of Lessee as defined
hei•ein �vithout the Lessor's pi•ioc• �v1•itten permission.
M. Lessee shall pay Lessor royalty on all gas produced fi•om a well on the leased premises
and sold or• used off the leased pi•emises, regai•dless of �vhether or iiot such gas is p►•oduced to the ci•edit
of Lessee or sold under a contract e�ecuted by or binding on Lessee. Sliould gas be sold under a sales
conh•act not binding on Lessee, Lessor's t•oyalty �vill be calculated based on the higl�est price paid for
any of the gas pi•oduced fi•om the �vell fi•om which such gas is produced. In no event �vill the pt•ice paid
Lessor for Lessor's share of gas be less than the price paid Lessee for Lessee's share of gas.
5<
POOLING
Lessee, upon the prior �vritten consent of Lessor �vhich shall not be unreasonably withheld, is
hereby given the right to pool or• combine the acreage covered by this Lease or any poi�tion thei•eof as to
oil and gas, or either of them with any other land, lease or leases in the immediate vicinity thereof to the
estent hereinafter stipulated, when it is necessaiy or advisable to do so in order to properly eYplore, or
develop, produce and operate said leased premises in compliance �vith the spacing rules of the appropriate
lawful authority, or when to do so would promote the �onservation of oil and gas in and under and that
may be pi•oduced fi�om said premises. In the absence of field rules, units pooled for• oil and gas her•eunder
shall not elceed tlie acl•eage provided for i•etained acreage tracts in Section 7. Lessee, under the pr•ovisions
hereof, may pool or combine acreage covered b,y this Lease or any portion thereof as above provided as to
g OIL AVD GAS LEASE-5200 and 5300 E. 2osedale Street
oil in any one oi• more strata and as to gas in any one or more sti•ata. The units foi•med by pooling as to
any stratum or strata need not conform in size or area witl� the unit or units into which the Lease is pooled
or combined as to any other stratum or strata, and oil units need not conform as to area with gas units.
The pooling in one o�• tnore instances shall not eYhaust the rights of the Lessee hereunder to pool this
Lease or portions thereof into othe�� units. Lessee shall file for record in the appropriate records of the
county in which the leased premises ai•e situated an instrument describing the pooled acreage as a pooled
unit. In this 1•egard, Lessee shall provide Lessor �vith a copy of any and all doctunents �led �vith any
regulatoiy authority or recorded in the records of any county within thirty (30) days of filing such
documents. Upon the recordation of the unit in the county records and the timely fiu•nishing of the copies
i•equired herein to Lessor the unit shall be effective as to all parties hereto, their• heirs, successors, and
assigns, irrespective of �vhether ot� not the unit is like�vise effective as to alI other owners of starface,
mineral, royalty or other rights in land included in sucl� unit. Lessee may at its election eYercise its
pooling option before or after commencing operations for or completing an oil or gas �vell on the leased
premises, and the pooled unit may include, but it is not required to inchide, land or leases upon which a
well capable of producing oil or gas in paying quantities has theretofore been completed or upon cvhich
operations for the drilling of a well for oil or gas have theretofore been commenced. In the event of
operations for drilling on or pr•odliction of oil or gas fi•om any par-� of a pooled unit which includes all or a
poi�tion of the land covered by this Lease, such operations shall be considered as operations for drilling on or
production of oil and gas fi•om land covei•ed by this Lease �vhethei• or not the well ot• �vells be located on
the premises covered by this Lease and in such event operations for drilling shall be deemed to have been
commenced on said land �vithin the meaning of this Lease. For the purpose of computing the royalties to
which owneis of royalties and payments out of production and each of them shall be entitled on
production of oil and gas, or eithei• of them, thet•e shall be allocated to the land covered by this Lease and
included in said unit (or to each separate tract within the unit if this Lease covers separate tracts �vithin the
unit) a pi•o rata porrtion of the oil and gas, or either• of tt�em, produced fi�om the pooled unit. Royalties
hei•eunder shall be computed on the por�tion of such pi•oduction, �vhether it be on oil and gas, or either of
9 OIL AND GAS I.EASE —�200 and 53Q0 E Rosednle Street
them, so allocated to the land covered by this Lease and IIlCILICIeCI in the unit just as tt1011��l such
production wei•e fi•om such land. The production fi•om an oiI well �vill be considered as production fi•om
this Lease or oil pooled unit fi•om which it is pt•oducing and not as production from a gas pooled unit; and
pi•od�iction fi•om a gas well will be considered as production fi•om this Lease or gas pooled unit from which
it is producing and not fi•om an oil pooled unit. The formation of any unit hereundei• shall not have tlie
effect of changing the owneiship of any delay rental or shut-in production royalty �vhich may becorne
payable under this Lease. If this Lease now oj• hereafter• covei•s separate tracts, no pooling or unitization
of royalty interest as between any such sepai•ate ti•acts is intended oi• shall be implied or result mei•ely
fi•oin the inclusion of such separate tracts within this Lease but Lessee shall nevei�theless have the i•ight to
pool as provided above with consequent allocation of production as provided above. As used in this
paragraph, the words "separate tract" mean any tract with royalty ownership differing, now or hereafter,
either as to parties or amounts, fi•om that as to any othei• part of the leased premises. Notwithstanding
any�thing to the contraiy therein above, no unit may be formed that is comprised of less than 50% of the
leased premises.
6.
CONTINUOUS DRILLING
At the e�piration of tfie prunaty tet7n this Lease shall remain in fiill %rce and effect for so long as
I_essee is conducting Continuous Drilling Oper•ations (as herein defined). Lessee sha11 be considered to be
engaged in Continuous Drilling Operations at the eXpu�ation of the primaiy term if: (1) Lessee is then
engaged in di•illing opei•ations on the leased premises or lands pooled there�vith or (2) Lessee has completed a
well as a producer or as a dry hole within one hundred riventy (120) days prior to the espiration of the
primaiy term. Lessee also shall be considered to be engaged in Continuous Drilling Operations for so long
thereafter as Lessee conducts di•illing ope►•ations on the leased premises, or lands pooled therewitli, �vith due
diligence and with intervals of no more than one hundred twenty (120) days benveen the date of completion
of one well and the date of commencement of drillin� opei•ations on an additional well. "Completion" shall
be consideced to be the date of release of the completion rig for a completed well, but in no event more than
1 O OII. AND GAS LEASE —�200 and 5300 E. Rosedale Street
one hundred riventy (120) days following the release of the drilling rig. In the case of a diy hole,
"completion" shall be considered to be the date of release of the drilling rig. "Commencement" shall be the
actual spud date of a�velL Continuous Drilling Operations sha(1 be deemed to have ceased upon the failure of
Lessee to commence drilling opei•ations on an additional �vell tivithin such one hundred nventy (120) day
period. When the Continuous Drilling Operations cease, the provisions of Pat•agraph 7 will be applicable.
7.
R�TAINED ACR�AG�
A. Vei�tical Wells
At the espiration of the primaiy term of this Lease or upon the tec•mination of the continuous
drilling pi•ogram set fot�th in Paragc•aph 6, each non-hoi•izontal well di•illed hereon capable of pi•oducing in
paying quantities will hold only forty (40) acres for any formation fi�om the surface to the base of the
Barnett Shale fonnation. As to depths below the base of the Barnett Shale Formation, the proration unit
shall be the minimum size necessaty to obtain tlie masimum pi•oduction allowable. If the pl•oration unit
for a well completed below the base of the Barnett Shale Formation is larger than 40 acres, the well may
maintain the Lease as to fortnations above the base of the Barnett Shale Formation as to not more than 40
acres. All other acreage eYcept that included in a proration unit or pooled tmit as described above will
cease to be covered by this Lease and �vill be released. To the extent possible, each such pi•oration unit �vill
be in the shape of a square, with the bottom of the well in the center. Fui�ther, it is undeistood and agreed
that Lessee shall earn depflis as to each proration unit or pooled unit only from the surface down a depth
which is the stratigraphic equivalent to a depth of one hundred feet (100') below the deepest producing
formation in such �vell which is capable of producing oil or gas in paying quantities at the eYpiration of
the primaiy ter�n of this Lease or upon the termination of the contimious drilling program set for�th in
Paragraph 6. This Lease �vill terminate at sucli time as to all depths below such depths as to each
respective pi•oi•ation unit or pooled unit. If production should thereaftei• cease as to acreage included in a
proration tu�it or pooled unit, this Lease will terminate as to such acreage unless Lessee commences
1 1 OIL AVD GAS LEASE—>200 and �300 E. Rosedale Street
rewoi•king or• additional drilling operations on such aci•eage �vithin ninety (90} days thereaftei• and
continues such reworking or additional drillivg operations until commercial production is restored
thereon, provided that if more than ninety (90) days elapse between the abandonment of such well as a
diy hole and the commencement of actual drilling operations for an additional well, or more than ninety
(90) days pass since the commencement of reworking operations without the restoration of commercial
production, this Lease shall terminate as to the applicable proration unit or pooled lmit.
At any time or times that this Lease terminates as to all or any poi�tion of the acreage of the leased
premises, Lessee shall promptly eYecute and record in the office of the County Clerk in the County
where the leased premises ai•e located, a propei• release of such terminated acreage and shall furnish
esecuted counterpat�ts of each such release to Lessor at the address shown in Paragraph 19 hereof.
B. Horizontal Welis
It is espressly understood and agreed that, subject to the other tertns, provisions and limitations
contained in this Lease, Lessee shall have the �•ight to di•ill "horizontal wells" under the leased premises,
or lands pooled therewith. The term °horizontal �vell" or "horizontally drilled �vell" shall mean any well that
is drilled with one or more horizontal drainholes having a horizontal drainhole displacement of at least five
hundred eighty-five (585) feet. For the purposes of fiii�ther defining the term "horizontal welis" and
"horizontally drilled" reference is made to the definitions contained within Statewide Rule 86, as
promulgated by the Railroad Commission of TeYas, which definitions are incorporated herein for all
purposes.
In the event of any partial termination of the Lease as p�•ovided in Paragraph 7A, then, with
regard to a well which is a horizontal well or a horizontally drilled well, Lessee shall be el7titled to retain
all sands and horizons at all depths from the surface down to a depth wt�ich is the stratigraphic equivalent of
a depth of one hundred (100) feet below the base of the deepest producing formation in such well which is
capable of producing oil or gas in paying quantities, but only in a spacing unit the area or number of acres
of �vhich are equal ta the area or mimber of acc•es deter►nined by adding riventy (20) acres for each five-
hundred eighty-five (585) feet horizontally drilled to the original forty (40) acres deemed to be a proration
12 OIL AND Gr�S LEASE — 5200 vtd �300 E. Rosedale Street
tmit for each ve��tical �vell. Each such ti•act ai•ound each horizontally drilled �vell shall be as neai•ly in the
shape of a squa►•e or a rectangle as is practical with the boundai•ies of the tract including the entii•e
horizontal drainhole and the lateral boundaries of such tract being approYimately equal distance fi•om such
di•ainho(e and parallel theeeto.
If pi•oduction should thereafter cease as to acl•eage iricluded in a pi•oi•ation unit oi• pooled unit, this
Lease will terminate as to such acreage unless Lessee cotnmences re�vorking oc• additional drilling
operations on such acreage within ninety (90) days thereafter and continues such reworking or additional
di•illing operations until commercial production is restoi•ed thereon, provided that if more than ninety (90)
days pass beriveen the abandonment of such tivell and the commencement of actual drilling ope►•ations for
an additional ��ell, or more than ninety (90) days pass since the commencetnent of reworking operations
witho�rt the restoration of commer•cial pi•oduction, the Lease sha11 tei•minate as to the applicable pi•oration
unit.
At any time or times that this Lease terminates as to all or any portion of the acreage of the leased
premises, Lessee shall promptIy esecute and r•ecord in the office of the County Clerk in the County where
the leased premises are located, a proper release of such terminated acreage and shall furnish esecuted
counterpai�ts of each such release to Lessor at the address sho�vn in Paragraph 19 hereof.
8.
OFrSET OSLIGATIONS
In the event a well or �vells producing oil or gas should be brought in on land within 330 feet fi•om
any boundaiy of the leased premises, Lessee agrees within sixty (60) days from commencement of
production fi•om such �vell or �vells to commence the actual drilling of an offset well or wells on the
leased premises; provided that the well or welis which are to be offset are producing in paying qtiantities and
have been pe�%rated and fi•aced �vithin 330 feet of the leased pi•emises; or Lessee shall release to Lessor fi�ee
of this Lease the offsetting ti•act of at least one hundred t�venty (120) aa�es.
13 OIL AND GAS LEASE — 5200 and 5300 E. Rosedale Strzet
9.
FORCE 1VIAJEUR�
A. The term "force majeure" as used herein shall mean and include: requisition, order,
regulation, or controt by governmental authority or commission; eYercise of r•ights or priority or conh•ol
by govet�nmental author•ity for national defense or war purpose resulting in delay in obtaining or inability to
obtain either material, equipment or means of transportation norma(ly necessaly in prospecting or drilling
foi• oil, gas or otl�er mineral gi•anted he►•ein, oi• in producing, handling oi• ti•ausporting same fi•oin the leased
pi•emises; �vai•, scai•city of or delay in obtaining matei•ials or equipment; lack of labor or means of
transpoi•tation of labor or materials; acts of God; insurrection; flood; strike; or other things beyond the
conti•ol of Lessee. The term "foi•ce majeul•e" shall not include lack of markets for pi•odl�ction oi• any othei•
events affecting only the economic or financial aspects of drilling, development or production or the
inability to conform to city, state or fedei•al regulations.
B. Notwithstanding any other provisions of this Lease, but subject to the conditions
hereinafter set forth in this Paragraph 9, should Lessee be prevented by "force majeure" as defined above,
from conducting drilling or reworking operations on, or producing oil, gas or other mineral from, the leased
premises, such failure shall not constitute a g►•ound for the termination of this Lease or subject said Lessee to
damages tl�erefore; and the period of time during �vhich Lessee is so prevented shall not be counted against
Lessee, but this Lease shall be estended for a period of time equal to that during which such Lessee is so
prevented fi•om conducting such drilling or reworking operations on, or producing oil, gas or other mineral
fi•om, such leased premises provided, ho�vever, that in no event will the primaiy tei�rn be eYtended ti�iless
Lessee has begun the acttial drilling of a�vell prior to the date of the eYpiration of the primary term. All
of the provisions of this paragr•aph are subject to each of the follo�ving elpress conditions:
'The te�7ns and conditions of this paragraph shall not eYtend beyond the expii•ation date of any la�v,
oi•der, rule or regulation im�oked undei• this pai•agraph, and shall be applicable and effective only
during the following pel•iods:
(1) If the force majeure shall occur diu•ing the primary term of this Lease, it shall not
I� OlL r�ND UAS LF:ASE — 5200 and 5300 E. Rosedale Street
operate to estend this Lease mot•e than nvo (2) consecutive years beyond the eYpiration of
the primaiy term.
(2) If the force majetu•e shall occur during a one hundt•ed twenty (120) day drilling
or reworking period provided for in Paragraphs 6 and 7 het•eof, after the primaiy term has
expired, then it shall not operate to eYtend the Lease more than two (2) successive years
beyond the eYpiration of such one hundred twenty (120) day periods.
(3) In no event will tlie primaiy term be eYtended unless Lessee has begun the
actual drilling of a well prior to the date of the eYpiration of the primaty term.
C. None of the provisions of this paragraph shall ever be oi• become effective atid applicable
unless Lessee shall, within a reasonable time (not to eaceed siYty (60) days in any event) after occurrence of
the claimed event of force majeure above referred to, notify the Lessor, in writing, of such occuri•ence
with fiill particulars thereof.
D. The terms of this paragraph do not apply to monetary payments due under the terms of this
Lease.
10.
SHUT-IN GAS WELL PROVISIONS
If at any time after the espiration of the primaiy term while tllere is a gas �vell on the Leased
pi•emises oi• land pooled tliere�vith �vhich is capable of producing gas in paying quantities, but the
production thereof is shut-in or suspended for any reasori, and if this Lease is not then continued in force
by some other provision hereof, then this Lease shall neveirtheless continue in force as to such well and the
pooled unit or• proration unit allocated to it for a period of siYty (60) days fi�om the date such �vell is shut-in
or at the end of the primary term, whichever is the later date. Before the e:cpiration of any such siYty (60)
day period, Lessee or auy Assignee hereunder may pay or tender to the Lessor a shut-in royalty equal to
Five Thousand Dollars ($5,000.00) per shut-in gas well and if such payment or tender is timely made, this
Lease shal[ continue in force but only as to said well or �vells and the proi•ation unit or the pooled uiiit
allocated to it or them and it shall be considered that gas is being produced fi•om said well or wells in
i s OIL AND GAS LF.ASE —�200 and 5300 E. Rosedale Street
payiug quantities for one (1) year fi•om the date such well or �vells are shut-in, anci in like manner one, and
only one, subsequent shut-in royalty payment may be made or tendered and it will be considered that gas is
being produced fi�om said well or wells in paying quantities fo►• such additional one (1) year period as well.
Lessee shall not be entitled to recovec any shut-in royalty payments fi•om the firture sale of gas.
Should such shut-in royalty payments not be made in a timely manner as provided in this section, it �vill be
considered for all purposes that there is no production and no escuse foi• delayed production of gas fi•om
any such well or �vells, and unless the�•e is then in effect other p�•eservation provisions of this Lease, this
Lease shall terminate. Lessee shall pay or tender directly to the Lessor• at the addi•ess as sho�vn in
Pai•agraph 19 all shut-in royalty payments as required by this Lease.
11.
INFORMATION, ACCESS AND R�PORTS
A. Lessor shall have fi•ee access at all times to all wells, tanks, and other equipment that
set�vices tivells under the leased pi•emises, including drilling wells, and Lessee abi•ees to furnish Lessor, or
Lessor's nominee, currently and promptly, upon written reqt�est, with full �vell information including
cores, cuttings, samples, logs (including Schlumberger and other electrical logs), copies and results of
de��iation tests and dii•ectional and seismic suiveys, and the results of all cirill stem tests and other tests of
other kind or• character that may be made of wells on the leased premises. Lessor oi• Lessoi•'s nomi�iee shall
be fiu•nisl�ed with and have free access at all times to Lessee's books and records relative to the production
and sale of oil, gas or other minerals from the leased preinises, including reports of evety kind and
character to governmental authorities, State or Federal. Lessor shall have the right at its election to
employ gaugers or install metet•s to gauge or measure the production of all minerals produced fi•om the
leased premises, and Lessee agrees to prepare and deliver to Lessor or Lessor's gauger or nominee duplicate
run or gauge tickets for all minerals i•emoved fi•otn the premises. Lessee shall fiirnish to Lessor• daily
di•illing repoi�ts on each well drilled.
B. Lessee shall fiu•nish to Lessor, �vitl�in a reasonable time after its e�ecution, a copy of any
gas purchase coirtract or transportation agreement entered into in connection with the leased pt•emises, or if
16 OIL AND GAS LEASE — 5?00 and 5300 E. Rosedale Street
tl�ere is already a gas purcl�ase co�rtract or transportation agreement in effect due to Lessee's operations in
the tield, then a copy of that contract. Furthermore, a copy of any amendments to the gas purchase contract
or tcanspoi�tation agreement shall be fiu•nished said Lessor within thirty (30) days after eaecution theceof
and on request of Lessor and �vithout cost to the Lessor, Lessee shall furnish Lessor a capy of the
follo«�ing reports: core recoi•d, coi•e anatysis, wel( completioii, bottom hole pi•essure measui•ement,
di�•ectional survey cecoi•ds, electrical and indtiction sui•veys anci logs, gas aild oi( i•atio i•epoi•ts,
paleo�itological repoi•ts �ertainiug to tlie paleo�itology of tlie formations eilcountered in tlie dri(liiig of aily
�vells oii tlle leased premises, and all other reports which pertain to the drilling, completing or operati�ig of
tlie ���e(ls located o�l the leased ��i•emises. Suc(1 i�lformatio�i sliall be solely foi• Lessor's use, a�id Lessor
shall in good faith attempt to lceep same coilfideutia( foi• t«relve (12) inoirtlis after receipt.
C. Lessee shall advise Lessor in writing of the location of each well to be dri(led upon the
(eased premises or on land pooled therewitli ou or before thirty (30) days prior to conunencement of
opet•ations, and shall advise Lessoi• in �vi•itiiig the date of completion and/oi• abandotiment of eacl� �vell
drilled on the leased premises or on land poo(ed there�vith �vithin thirry (30) days after completion or
abandonment.
12.
PRESERVATION OF ECOLOGY OF LEASED PR�MISES
Any overflows or releases affecting the leased premises, including, but not limited to, salt
water, mud, chemical, or oil shall be reported immediately to Lessor. Lessee shall not use any
water in, on or under the leased premises without the prior written consent of the Lessor.
13.
REMOVAL OF EQUIPMENT
Lessee shall have the right at any time during or within sia (6) months after the eapiratiou of this
Lease (but not thei•eaftei•) to remove all p1•operty and fixtui•es placed by Lessee on the leased pi•emises,
inchiding the rig(it to draw and remove all casing.
�� O(L AND GAS LEASE — 5200 a��d �300 E. Rosedale Street
This para�•aph shall not apply to equipment ot• casing on or in an oil or gas �vell capable of producing in
paying qua�itities, but Lessee shall be paid i•easonable salvage value for any such casing or equipment. It is
contemplated that Lessee may drill across and through lands covered by this agreement where production is
not obtained oi• ceases. Where the casing or pipeline placed ol• laid through such non-producing lands is
necessaty to the production of a well or wells located on other lands covered by this Lease, or lands pooled
therewitll, it is eYpressly undei•stood and agreed tl�at Lessoi• will make no demand that such casing, pipelines
or other equipment necessaiy for the production of a well or wells drilled by Lessee be removed as long as
such casing, pipelines and other equipment is necessa►y for the production of a producing well or• �vells
drilled by Lessee.
14.
ASSIGNABILITY BY LESSEE
This lease may be assigned in whole or in part by Lessee and the provisions shall eYtend to the
heirs, eYecutors, administrators, successors and assigns of the parties hereto; provided, ho�vever, that any
such assignment by Lessee shall rec�uire the prior written consent of Lessor. All transfers by Lessee
(including assigmnents, sales, subleases, overriding royalty conveyances, 02' pl'OdLICil011 paymerrt
arrangements) must be recorded in the county where the lease pi•emises ai•e located, and the recorded h�ansfer
or a copy certified to by the County Clerk of the county �vhere the transfer is recorded must be delivered to
the Lessor within sisty (60) days of the eYecution date. Every transferee shall succeed to all rights and be
subject to all obligations, liabilities, and penalties o�ved to the Lessor by the original Lessee or any prior
transferee of the Lease, including arry liabilities to tlle Lessor for unpaid royalties. No such transfer shall
release the Lessee (or any subsequent ti•ansfer•or) from any obligation hereunder.
15.
NO WARRANTY
This Lease is given and granted without �vairanty of title, elpress or implied, in law oi° in equity.
Lessor agrees that Lessee, at Lessee's option, may purchase or discharge, in �vhole or in part, any ta�,
moi�tgage oi• othei• lien ttpon the leased premises and thereupon be stibi•ogated to the i•ight of the holdei•
1 g OII_ AND GAS LE•r�SE — 5200 and 5300 E. Kosedale Street
thereof, and may apply royalties accruing hereunder toward satisfying same or reimbui•sing Lessee. It is
also agreed that if Lessor owns an interest in the oil and gas under the leased premises less tl�an the entire
fee simple estate therein, the royalties to be paid Lessor shall be reduced propoi�tionately, but in no event
shall the shut-in royalty amount for a gas well, as provided for in Paragrapl� 10 hereof, be reduced.
16.
INDENPi tITY
LESSEE SHEILL EI�PIt�55LY RELEAS� AND DISCHARGE, AL� CLAIM�,
DEMANDS, ACTIONS, JUDGMENTS, AND �X�CUTIONS WHICH IT �VER HAD, OR NOW
HAS OR MAY HAVE, OR ASSIGNS MAY HAV�, OR CLAIM TO HAVE, AGAINST THE
LESSOR OR ITS D�PARTII�I�N�'S, AG�NT�, OFFICERS, �ERVANT�, SUCC�SSOR�,
AS5IGNS, SPONSORS, VOI.UNTEERS, OR EMPLOY��S, CREATED BY, OR ARISING OUT
OF PERSONAL INJ[TRIES, KNO`VN OR UNKNOWN, AND INNRIES TO PROP�RTY, REAI.
OR PERSONAL, OR IN ANY WAY INCIDENTAL TO OR I�t CONNECTION WITH TH�
PERFORiYIANCE OF TH� WORI� P�RFORM�D BY TAE LESSE�. THE LESSEE SHALL
FULLY D�FEND, PROT�CT, INDEMNIFY, AND HOLD HARML�SS TH� LESSOR, ITS
DEPARTMENTS, AG�NTS, OFFICERS, SERVANTS, EMPLOY�ES, SUCCESSORS, ASSIGNS,
SPONSORS, OR VOLtINT��RS TROIVI AND AGAIloTST EACH AND �VERY CLAIM,
DEMAND, OR CAUSE OF ACTION AND ANY AND ALL LIABILITY, DAMAGES,
OBLIGA�'IONS, JUDGMENTS, LOSSES, FINES, P�NALTIES, COSTS, FEES, AND
�XP�NSES INCURRED IN DETENS� OF THE L�SSOR, ITS D�PARTM�NTS, AGENTS,
OFFICERS, SERVANTS, OR �1VIPLOYE�S, INCLUDING, WITHOUT LII�IITATION, TI�
PAYMENT OF BONUS AND/OR ROYALTIES REGARDING OWN�RSHIP OF THE
L�SSOR'S MINERAL INT�REST OF THE L�ASED PR�NIISES WHICH MAY BE NIAD� OR
ASSERT�D BY LESS�E, ITS AG�NTS, ASSIGNS, OR ANY THIRD PARTIES ON ACCOUNT
OF, ARISING OUT OF, OR IN ANY WAY INCIDENTAL TO OR IN CONNECTION �VITH
19 OIL AAID GAS LEAS� — 5200 and 5300 E. Rosedale Street
TH� O`Vl�ERSHIP AND TITLE OF THE MI�i�RAL I�1TER�ST OF THE L�SSOR UND�R
THI� LEASE.
THE LESSE� SHALL FULI.Y D�FEND, PROT�CT, I��1D�Mi�tIFY, AII`11D HOLD
HARMLESS TH� L�SSOR, IT� D�PARTNIENTS, AG�NTS, OFFICERS, SER�ANTS,
EMPLOYEES, SUCC�SSORS, ASSIGNS, SPONSORS, OR VOLUI�tT�ERS FROM ANI�
AGAINST �ACH AND �VERY CLAIM, D�ii�IAND, OR CAUSE OF ACTION AND ANY AND
ALL LIABILITY, DANIAG�S, OBLIGATIONS, JUDGM�NTS, LOSS�S, FINES, P�NAI.TIES,
C05TS, FE�S, AND �XPENS�S INCURR�D IN D�FENS� OF THE LESSOR, ITS
D�PARTM�NTS, AGENTS, OFFIC�RS, S�RVANTS, OR EMPLOY��S, INCLUDING,
WITHOUT LIMITATION, P�RSOlo1AL INJ[JRI�S AlVD DEATH IN CONNECTION
THEREWITH WHICH 1VIAY BE MAD� OR ASS�RTED BY L�SSEE, ITS AGENTS, ASSIGNS,
OR ANY THIRD PARTIES ON ACCOUNT OF, ARISING OUT OF, OR IN ANY WAY
INCIDENTAL TO OR IN CONNECTION WITH TH� PERFORitiIANCE OI' TH� WORK
PERFORM�D BY TAE LESS�E UNDER THIS LEAS�.
THE L�SSEE AGR�ES TO INDEMNIFY AND HOLD HARMLESS THE LESSOR, ITS
OFFICERS, AG�NTS, SERVANTS, �MPLOYEES, SUCC�SSORS, ASSIGNS, SPONSORS, OR
�IOLUNTE�RS FROM ANY LIABILITIES OR DAMAG�S SUFFERED AS A RESUL'd' OF
CLAIMS, D�MANDS, COSTS, OR JUDGM�NTS AGAINST THE LESSOR, ITS
D�PARTMEIe1TS, ITS OFFIC�RS, AGENTS, SERVANTS, OR CMPLOY�ES, CR�ATED BY,
OI2 ARISING OUT OF THE ACTS OR OMISSIONS OF TH� L�SSOR OCCURRING ON TH�
DRILL SIT� OR OP�RATION SITE IN THE COURSE AND SCOPE OF INSPECTING AND
P�RD�IITTING THE GAS WELLS liti1CLUDING, BUT NOT LIMITED TO, CLAIMS AND
DAMAGES ARISIPIG IN WHOLE OR IN PART rROVI THE NEGLIGENCE OF THE L�SSOR
OCCURRING ON TH� DRILL SITE 012 OPERATION SITE IN THE COURSE AND SCOP�
OF INSPEC�'ING AND PERMITTING THE GAS `VELLS. IT IS UNDERSTOOD AND
AGRE�D THAT TH� I1o1ll�NINITY PROVIDED FOR IN THIS SECTION IS AN IND�1vINI�Y
20 OIL AND GAS LEASE — 5200 and 5300 E. Rosedale Street
EXTEND�D BY TH� L�SSEE TO INDEyINIFY AND PROTECT L�SSOR AND/OR I�'S
D�PARTM�NTS, AGEN'T5, OFFICERS, SERVANTS, OR EMPLOYEES FROI�I TI-�E
CONS�QU�NCES OF TH� NEGLIG�NCE OT TH� LESSOR AND/OR ITS �EPARTM�I�1T5,
AG�NTS, OFFICERS, S�RVAI�'I'S, OR EIVIPLOY�ES, WHETHER THA'I' NEGLIGEIotC� IS
THE �OL� OR CONTRIBUTI�G CAUS� OF TH� R�SULTANT IN3�1RY, DEAT�I, Al�1D/OR
DAMAGE.
17e
INSURANC�
Lessee shall provide or cause to be pi•ovided the insurance described in the City of Fort �Vorth
Gas Ordinance for each well drilled under the terms of this Lease, such insurance to continue until the
well is abandoned and the site restored. Such insurance shall provide that Lessor shall be a co-insured,
�vithout cost, and that said insurance can not be canceled or terminated without thirty (30) days prior
notice to Lessor and ten (10) days notice to Lessor for nonpayment of premiums.
18.
It�L�ASE� R�QUIRED
Within thirty (30) ciays after the partial termination of this Lease as provided under any of the
tecros and provisions of this Lease, Lessee shall deliver to Lessol• a plat showing the pi•oduction units
designated by Lessee, copies of logs showing depths to be i•etained within each unit, and a fiilly eYecuted,
recordable release properly describing by metes and bounds the lands and depths to be retained by Lessee
around each producing we1L If this Lease terminates in its entirety, then Lessee shall deliver a complete,
fully executed, recordable release to Lessor tivithin thirty (30) days. If such release complies tivith the
requirements of this section, Lessor shall recorcl such release. If Lessee fails to deliver a release
camplying with the requirements of this section tivithin thirty (30) days after Lessor's demand therefore,
then Lessee shall pay Lessoi• an amount equal to Five Dollat•s ($5.00) per acre pe�• day for each acre of the
leased pretnises that should have been released, beginning �vith the 30t1� da,y after the date of Lessor's
21 OIL AND GAS LEASE — 5200 anc! >300 E Rosedale Street
i•equest and continuing until such release has been eYecuted and delivered to Lessor. It is agi•eed that
actual damages to Lessor for Lessee's faili�re to deliver such release are difficult to asce►-tain �vith any
cei•tainty, and that the paytnents herein provided ai•e a reasonable estimate of such damages and shall be
considered liquidated damages and not a penalty. Furthermore, Lessor is het•eby authorized to execute
and file of record an affidavit stating that this Lease has eYpired a�id the reason thei•efor, and such
affidavit shall constitute prima facie evidence of the eYpiration of this Lease or• any part of this Lease.
19.
NOTIC�S
A. Notifications Required. Lessee shall advise Lessor in writing of the location of
each well to be driiled upon the leased premises or on land pooled therewith on or before thirty
(30) days prior to commencement of operations, and shall advise Lessor in writing the date of
completion and/or abandonment of each �vell drilled on the leased premises or on land pooled
there�vith within thirty (30) days after completion or abandonment. Such notice shall include
furnishing the Lessor a copy of the applicable completion or plugging repoi�t filed with any
governmental or regulatory agency and a plat or map showing the location of the well on this
Lease or lands pooled therewith.
Reports are also to be made monthly, to include (1) name of �vell, total monthly
pr•oduction and total product sales and (2) lease activity report to include drilling, testing, fi•acing,
completing, reworking, recompleting, plugging back, repairing and abandonment of the well and
(3) compliance �vith the Minority/Women Business Enterprise (MWBE) Goal of _% for leases
over 40 acres.
B. All notices, information, letters, stuveys, repor�ts, material, and all other documents,
required or permitted to be sent to Lessor by Lessee shall be sent by certified United States mail, postage
prepaid, i•ettu•n receipt requii•ed, to the follo�ving address:
22 OlL AND GAS LEASE — 5200 and 5300 E. Rosedale Street
City of Fort Woi•th
Attention: Property Management Department
1000 Throckmoi�ton Street
Fort Woi•th, Texas 76102
C. All notices required oi• permitted to be sent to Lessee by Lessor shall be sent to Lessee by
certified United States mail, postage p►•epaid, retuj•n i•eceipt requested to the following address:
Vantage Foirt Wo►•th Energy, LLC
116 Invet•ness Drive East, Suite 107
Englewood, CO 80112
D. Seivice of notices, and other documents, hereunder is complete upon deposit of the mailed
material in a post ofitce or official depositoiy undei• the care and custody of the United States Postal Seivice,
in a postpaid, properly addressed and cettified wrapper.
E. Any party hereto shall have the right to change the name or address of the person or
persons required to receive notices, and other documents, by so notifying the other party in writing.
20.
BREACH BY LESSE�
Lessee shall conduct Lessee's operations in strict compliance with all of the terms and provisions of
this Lease and with all applicable local, state and federal rules and the regulations of any regulatory body
having jurisdiction of such operations including, but not limited to, all lacal, state and federal environmental
rules and regulations and applicable city ordinances.
In the event Lessor considers that operations are not, at any time, being conducted in compliance
with this Lease, or any implied covenant of this Lease, Lessor shall notify Lessee in writing of the facts
relied upon as constituting a breach of any express or implied covenant or obligation of Lessee hereunder
and, Lessee, if in default, shall have sixty (60) days after receipt of such notice in which to commence
compliance �vith its obligations hei•eunder. Failure on the part of Lessee to timely commence efforts to rectify
any such breach and to esercise diligeuce in remedying any such breach shall operate as a forfeiture of this
Lease as to the portion thereof effected by such breach; provicied that if Lessee, in good faith, disputes any
23 OIL AND GAS LEASE — 5200 and 5300 E. Rosedale Street
alleged grounds of breach set fol�th iii such notice, Lessee mav, within said silty (60) day period, institute a
Declaratoty Judgment Action in any District Court in a county �vhere all or pai-t of the said leased
premises at•e located questioning �vhether• it has in fact bi•eached any eYpi•essed ar• implied covenant of this
Lease, thereby staying any forfeiture during the pendency of such action. However•, in the event that
Lessor obtains a final judicial ascei•tainment in any such proceeding that Lessee is in breach of any
covenant hereof, eYpress or implied, then it is agreed that Lessor shall be entitled to a decree providing for
cancellation or forfeiture of the Lease in the event such breach is not rectified or commenced in good faith
to be recti�ed by Lessee within thirty (30) days fi•om date such deci•ee becomes final.
21.
LOCATION OF DRILLING ACTIVITY, PIPELINES AND EQUIPM�NT
No drilling or other activity shall be condticted on the sui•face of the leased pi•emises and no
roads, electric lines, pipelines, equipment, or other strucriu•es shall be placed on the surface of the leased
premises.
22.
COMPLIANCE WITH LAWS
Lessee shall comply �vith all applicable rules, t•egulations, ordinances, statutes and other laws in
connection �vith any drilling, producing or other operations under the te��rns of this Lease, including,
�vithout limitation, the oil and gas �vell regulations of the City of Fort Worth.
23.
CONTLICT OF INTEREST
Lessee represents that Lessee; its officers and directors, are not employees or officeis of the City
of Fot�t Worth nor is Lessee (its officers and directors} acting on behalf of any such officer or employee of
the City of Fo��t Worth.
24.
T�RMS
All of the tet•ms and pi•ovisions of this Lease shall eYtend to and be binding upon the heirs,
2� OIL A;v'D GAS LEASE — 5200 and 5300 F. Rosednle Street
esecutors, administrators, successors and authorized assigns of the parties hereto.
25.
�NTIRE AGR�EMEI�IT
This Lease states the entire contract between the parties, and no representation or promise, verbal
or wi•itten, on behalf of eithec party shall be binding unless contained hei•ein; and this Lease shall be
binding upon each pacty e:cecuting the same, regardless of whethe►• or not exectated by all owners of the
above described land or by all persons above named as "Lessor", and, notwithstanding the inclusion
above of other names as "Lessor", this teini as used in this Lease shall mean and refer only to such parties
as execute this Lease and theii• successoi•s in intei•est.
26.
CAPTIONS
The captions to the vai•ious paragraphs of the Lease ac•e for convenience only, to be used
primarily to more readily locate specific pi•ovisions. They shall not be considered a part of the Lease, nor
shall they be tised to intei•pret aily of the Lease provisions.
27.
COUNTERPARTS
This Lease may be eYecuted in multiple counterparts, each of which shall be deemed an original,
�vith the same effect as if the signature thereto and hereto were upon the same instrument.
28.
INTERPRETATION
In the event of any dispute ovei• the meaning or application of any provision of this Lease, this
Lease shall be intei•preted fair•ly and reasonably, and neither moi•e strongly for or against any party,
t•egardless of the actual draftet• of this Lease.
29.
NO THIRD PARTY RIGHTS
The provisions and CO11CI1t10I1S of this Lease are solely for the benefit of the Lessor and the
25 Olt_ AND GAS LEASE — 5200 and 5300 E. Rosedale Street
I.essee, and any la�vful assign or successor of the Lessee and are not intended to ci•eate any i•ights,
contractual or otheitivise, to any other person or entity.
30.
S�V�RABILITY
If any provision of this Lease shall be held to be invalid, illegal oi• u�ienfoi•ceable, the validity,
legality and enfoi•ceability ofthe remainiug provisions shall not in any way be affected or impaired.
31.
V�NUE AND JUI2ISDICTION
If any action, whether real or asserted, at law or in equity, arises on the basis of any provision of
this Lease, venue for such action shall lie in state courts located in Tar•rant County, TeYas or the United
States District Court for the Noi�thei•n District of Tesas — Fort Woirth Division. This Lease shall be
construed in accordance with the la�vs of the State of TeYas.
32.
INDEPENDENT CONTRACTOR
It is eYpressly understood and agreed that Lessee shall operate as an independent contractor in
each and evecy respect hereunder and not as an agent, representative or employee of the Lessor. Lessee
shall have the e�clusive right to control all details and day-to-day operations relative to this Lease and all
EYhibits and shall be solely responsible for the acts and omissions of its officers, agents, servants,
employees, contractors, subcontractors, licensees and invitees. Lessee acknowledges that the doctrine of
f•espof7decrt sarpef�ior �vill not apply as bet�veen the Lessol• and Lessee, its officers, agents, servants,
employees, conh•actoi•s, subcoirtractors, licensees and invitees. Lessee further agrees that notliing in this
Lease �vill be construed as the creation of a pairtnership o►• joint enterpi•ise bet�veen the Lessor and Lessee.
33.
GOVERNM�NTAL POWERS
It is understood that by e�ecution of this Lease, the Lessoi• does not �vaive or sui•rendei• any of it
governmental po�vers.
26 OIL AND GAS LEASE — 5200 and �300 E. Rosed�te Street
EXECUTED and effective as of the date of the notarial ackno�vledgment of the Lessor's etecution.
L�SSOR:
CITY OI' FORT WORTH
-�—' �
By: �
Assistant City Managec �
APPROVED AS TO FORM AND LEGALITY:
� 7
By: ��1�-�i,i , ��.%i��_ .��, � ���C,L �V -��;
��� Assista►S City Attorn y ` �
C'!{E�Sr►-� R<<e?(:2 i�i��;N,.�uS
Date:
L�SS��: VANTAG� FORT WORTH �N�RGY, LLC
A Delaware Limitecl Liability Co�•poration
By: �'��` � 1�_z�.
Date: �� � � � �/ �
ATTC -'�
�
� ^ ^; �.,
�%
it�� Secret r �
OFFICIAL RECORf�
CITY S�GR�TAR�'
�"�'• W�Ak�H, 'TX
27 OII. AND GAS LI:ASG —?200 antl i300 Ii Rosednlc titreet
THE STATE OF TEXAS
COUNTY OF TARRANT
BEFORE ME, the undersigned, a Notary Public, on this day personally appeared Jesus J. Chapa,
Assistant City Manager of the City of Foi�t Woi•th, a home-rule municipal corpoi•ation of the State of
Texas, Irnown to me to be the pecson whose name is subscribed to the foregoing instcument and, that he
has executed the same for the pucposes and conside�•ation therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this �`'� day of ��_� `a-t ��2016.
[S�',AL] � , .
��' i'�.r►. p�_ (��,� ��� �;1 (��?�--'L/I� t' Nota�y Public in and for the � _.� �' . � -- ` ` �, .=
�""""b�. LINDA IVI. HIRRLINGER
State of Texas hRY.°ye �
't' ��;��`=. Notay Fubilc, State of Texas
�� , t ;: r�� �r c Comm. Expires 02-02 2018
My Commission Expires: � f#'' ;' ',' �` -;F.,�•�:�°'
,,,,,,,,,.� Notary ID 12414A74•6
�� - i I�(�L� �,'�� ,. (}� Y r�(�i1 �.{' r Pcint Name of Nota�y Public Hei•e ;;�..� —
�,j
THE STATE OF
COLJNTY OF 1�i1. ZxT(%
BEFORE ME, the undersigned, a Notaiy Public, on this day personally appeared W. Worth
Carlin, Vice Pi•esident — Land, of Vantage Fo►�t Woi�th Enei•gy, LLC, a Delaware Limited Liability
Corporation, known to me to be the person whose name is subscribed to the foregoing instrument and,
that he has executed the same fo�� the pucposes and considei•ation therein expressed.
GIVEN LJNDER MY HAND AND SEAL OF OFFICE this �s� `'� day of ���f.e� trh�%�—, 2016.
[SEAL]
� / � DOROTHEA R WIRE
�(�i Fj��t.���-cL� �� ,�Li�1s�_ - Notary Public in and for the NornRv Puauc
STATE OF COLORADO
NOTARY ID # 19�J6400A384
E j MY COMMISSION EXPIRES MARCH 04, 2018
State of �,�-� �,
MyCommission Expi►•es� ��-=�°���"������c �j �'�
%)� «c �'!'/t!_"�� f� LI/)h'�-�� Print Name of Notary Public Hece
� ��FICIAIL RECOitD
CITY S1ECR�T/�RY
i'.'I�l�illtl"f�, �!'�
- ---_ _ - �
28 OI1. AND GAS LCASP. — 5200 and 5300 G. Rosed��le Street
�XHIBIT A
Ti•act II:
3.366 acr•es, more oi• less, out of the Daniel Dulaney Sui•vey, A-41 l, Tarrant County, TeYas, being Lot B,
Block 2R, Rosedale Plaza Addition, an addition to the City of Fort Worth, Tarrant Coiinty, Texas,
according to the Revised Plat dated October 30, 1967, recorded in Volume 388-44, Page 48, Plat Records,
Tareant County, Telas, being more particularly described by metes and bounds in that ceirtain Deed dated
November 5, 1969, foj•m Ryan Mortgage Company, to the City of Fort Worth, recot•ded in Volume 4823,
Page 334, Deed Recoi•ds, Tarrant County, Te:cas,TOGETHER WITH, tliose lands described in that
certain Special Warrant Deed dated June 21, 1990, from KnoY Street Holdings, Lic., to the City of Fort
Worth, recorded in Volume 9963, Page 1640, Deed Records, Tarrant County, Texas.
(CFTW 5200 & 5300 E. Rosedale Street)
(ROSEDALE WEST UNIT)
29 OIL AND GAS LEASE — 5�0(1 and �300 E. Rosedale Street