<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to ______________
Commission file number 0-8609
Bargo Energy Company
(Exact name of small business issuer as specified in charter)
Texas 87-0239185
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
700 Louisiana, Suite 3700
Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
(713)236-9792
(Issuer's telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes [x] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
The Company had approximately 92,173,000 shares of common stock, par value $0.01
per share, issued and outstanding as of November 15, 1999.
Transitional Small Business Disclosure Format (Check One): Yes No X
<PAGE> 2
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The condensed consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted.
However, in the opinion of management, all adjustments (which consist only of
normal recurring adjustments) necessary for a fair statement of the financial
position and results of operations for the periods presented have been made.
These condensed consolidated financial statements should be read in conjunction
with financial statements and the notes thereto included in the Company's Form
10-KSB filing for the year ended December 31, 1998.
<PAGE> 3
BARGO ENERGY COMPANY AND SUBSIDIARIES
(FORMERLY FUTURE PETROLEUM CORPORATION
AND SUBSIDIARIES)
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
September 30, 1999 December 31, 1998
(unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 1,146,000 $ 1,241,000
Trade accounts receivable, no allowance for
doubtful accounts considered necessary:
Joint interest billings 12,000 --
Accrued oil and gas sales 4,373,000 2,636,000
Advance to related party 20,000 8,000
------------ ------------
TOTAL CURRENT ASSETS 5,551,000 3,885,000
------------
PROPERTY AND EQUIPMENT
Oil and gas properties, full cost method 73,476,000 45,992,000
Other 713,000 648,000
------------ ------------
TOTAL PROPERTY AND EQUIPMENT 74,189,000 46,640,000
------------ ------------
Less accumulated depletion, depreciation
and amortization (3,975,000) (1,566,000)
------------ ------------
NET PROPERTY AND EQUIPMENT 70,214,000 45,074,000
OTHER ASSETS
Goodwill, net 1,842,000 1,984,000
Loan costs, net 914,000 965,000
Mining properties held for sale 40,000 40,000
Other 1,000 --
------------ ------------
TOTAL OTHER ASSETS 2,797,000 2,989,000
------------ ------------
TOTAL ASSETS $ 78,562,000 $ 51,948,000
============ ============
</TABLE>
<PAGE> 4
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
September 30, 1999 December 31, 1998
(unaudited)
<S> <C> <C>
CURRENT LIABILITIES
Current portion of long-term debt $ 9,000 $ 8,952,000
Trade accounts payable 2,748,000 1,457,000
Accrued oil and gas proceeds payable 393,000 514,000
Accrued interest payable 190,000 430,000
Advance from related party 1,000 566,000
------------ ------------
TOTAL CURRENT LIABILITIES 3,341,000 11,919,000
------------ ------------
LONG TERM DEBT, less current portion 19,605,000 30,907,000
DEFERRED TAX LIABILITY 594,000 1,011,000
------------ ------------
REDEEMABLE PREFERRED STOCK, 10% cumulative dividend;
$.01 par value; 5,000,000 and 0 shares authorized,
issued and outstanding at September 30, 1999 and December 31,
1998, respectively 51,935,000 0
------------ ------------
STOCKHOLDERS' EQUITY
Series A Preferred stock, $.01 par value, 0 and 200,000 shares
authorized; 0 and 100,000 shares issued and outstanding
at September 30, 1999 and December 31, 1998, respectively 0 1,000
Common stock, $.01 par value; 120,000,000 and 30,000,000
shares authorized; 91,830,544 and 22,320,066 shares issued;
91,830,544 and 22,320,066 shares outstanding at September 30,
1999 and December 31, 1998, respectively 918,000 223,000
Additional paid-in capital 3,657,000 6,543,000
Treasury stock (87,000) --
Retained earnings (deficit) (1,400,000) 1,344,000
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 3,088,000 8,111,000
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 78,562,000 $ 51,948,000
============ ============
</TABLE>
<PAGE> 5
BARGO ENERGY COMPANY AND SUBSIDIARIES
(FORMERLY FUTURE PETROLEUM CORPORATION
AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
---------------------------------
1999 1998
------------ ------------
<S> <C> <C>
REVENUES
Oil and gas sales $ 4,514,951 $ 812,326
Hedge gain (loss) (211,400) 0
------------ ------------
TOTAL REVENUES 4,303,551 812,326
------------ ------------
COSTS AND EXPENSES
Lease operations and production taxes 1,869,260 488,305
General and administrative 709,186 70,300
Depletion, depreciation and amortization 386,090 166,443
------------ ------------
TOTAL EXPENSES 2,964,536 725,048
------------ ------------
OTHER INCOME
Interest expense (221,402) (124,385)
Interest income 1,642 921
Miscellaneous income -0- 1,422
------------ ------------
TOTAL OTHER INCOME AND (EXPENSE) (219,760) (122,042)
------------ ------------
INCOME (LOSS) BEFORE INCOME TAXES 1,119,255 (34,764)
DEFERRED INCOME TAX BENEFIT (EXPENSE) (380,000) 12,000
------------ ------------
NET INCOME (LOSS) 739,255 (22,764)
------------ ------------
REDEEMABLE PREFERRED STOCK DIVIDENDS 1,277,009 -0-
------------ ------------
NET INCOME (LOSS) ALLOCABLE TO COMMON
SHAREHOLDERS $ (537,754) $ (22,764)
============ ============
NET INCOME (LOSS) ALLOCABLE PER COMMON SHARE -
BASIC AND DILUTED (.006) (.002)
------------ ------------
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING 91,830,544 9,708,000
------------ ------------
</TABLE>
<PAGE> 6
BARGO ENERGY COMPANY AND SUBSIDIARIES
(FORMERLY FUTURE PETROLEUM CORPORATION
AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
---------------------------------
1999 1998
------------ ------------
<S> <C> <C>
REVENUES
Oil and gas sales $ 9,651,232 $ 1,902,855
Hedge gain (loss) (131,500) 0
------------ ------------
TOTAL REVENUES 9,519,732 1,902,855
------------ ------------
COSTS AND EXPENSES
Lease operations and production taxes 4,187,264 1,131,754
General and administrative 2,376,692 290,953
Depletion, depreciation and amortization 2,558,658 368,756
------------ ------------
TOTAL EXPENSES 9,122,614 1,791,463
------------ ------------
OTHER INCOME
Interest expense (1,630,536) (406,511)
Interest income 6,656 3,639
Miscellaneous income -0- 12,382
------------ ------------
TOTAL OTHER INCOME AND (EXPENSE) (1,623,880) (390,490)
------------ ------------
INCOME (LOSS) BEFORE INCOME TAXES (1,226,762) (279,098)
DEFERRED INCOME TAX BENEFIT (EXPENSE) 417,000 98,000
------------ ------------
NET INCOME (LOSS) (809,762) (181,098)
------------ ------------
REDEEMABLE PREFERRED STOCK DIVIDENDS 1,934,543 -0-
------------ ------------
NET INCOME (LOSS) ALLOCABLE TO COMMON
SHAREHOLDERS $ (2,744,305) $ (181,098)
============ ============
NET INCOME (LOSS) ALLOCABLE PER COMMON SHARE
- BASIC AND DILUTED (.039) (.026)
------------ ------------
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING 70,622,270 7,053,000
------------ ------------
</TABLE>
<PAGE> 7
BARGO ENERGY COMPANY AND SUBSIDIARIES
(FORMERLY FUTURE PETROLEUM CORPORATION
AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
---------------------------------
1999 1998
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (809,762) $ (181,098)
Adjustments to reconcile net income
(loss) to cash provided by operating
activities:
Depletion, depreciation, and
amortization 2,558,658 368,756
Amortization of debt issue costs 153,909 -0-
Deferred income taxes (417,000) (98,000)
------------ ------------
Net cash provided by (used in) operating
Activities before changes in working capital 1,485,805 89,658
Change in working capital items:
Decrease (increase) in
accounts receivable (1,748,915) (518,418)
Increase in advances to
related parties (11,874) -0-
Increase (decrease) in accounts payable
and accrued liabilities 929,712 556,638
Decrease in advances from
related parties (564,900) -0-
Other (7,877) (11,471)
------------ ------------
NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES 81,951 116,407
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of oil and gas properties (27,484,342) (7,187,420)
Additions to property and equipment (64,968) -0-
------------ ------------
NET CASH PROVIDED BY (USED IN)
INVESTING ACTIVITIES (27,549,310) (7,187,420)
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of debt 17,760,262 8,773,594
Purchase of treasury stock (90,314) -0-
Repayment of long-term debt (38,005,522) (1,820,787)
Proceeds from issuance of stock 50,000,000 251,086
Stock issuance costs (2,198,534) -0-
Loan costs (102,977) -0-
Proceeds from exercise of stock options 10,071 -0-
------------ ------------
NET CASH PROVIDED BY (USED IN)
FINANCING ACTIVITIES 27,372,986 7,203,893
------------ ------------
NET INCREASE (DECREASE) IN CASH (94,373) 132,880
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 1,241,000 292,931
------------ ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 1,146,627 $ 425,811
============ ============
SUPPLEMENTAL INFORMATION:
Cash paid during the period
for interest $ 1,707,501 $ 406,511
============ ============
</TABLE>
<PAGE> 8
BARGO ENERGY COMPANY AND SUBSIDIARIES
(FORMERLY FUTURE PETROLEUM CORPORATION AND SUBSIDIARIES)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1: THE COMPANY
Bargo Energy Company (the "Company" or "Bargo") is engaged through its
subsidiaries and subsidiary partnerships in the development of oil and natural
gas properties located onshore, primarily in the Gulf Coast Region (Texas and
Louisiana) and California. The Company's principal business strategies include
(i) maximizing the value of its existing high-quality, long-life reserves
through efficient operating and marketing practices, (ii) conducting detailed
field studies using the newest technology to identify additional reserves and
exploration potential, and (iii) seeking acquisitions of producing properties,
with exploration and development potential in areas where the Company has
operating experience and expertise.
On April 26, 1999 (the "Effective Date"), Future Petroleum Corporation, a Utah
corporation ("Future"), merged with Bargo Energy Company, a Texas corporation
("Bargo"). Bargo was incorporated under the name FPT Corporation on January 26,
1999 as a wholly owned subsidiary of Future, solely for the purpose of
reincorporating Future in Texas.
The reincorporation occurred pursuant to a merger agreement dated April 6, 1999
entered into between Future and Bargo ("Merger Agreement"). In accordance with
the terms of the Merger Agreement, Future merged into Bargo, with Bargo as the
surviving corporation. On the Effective Date, each of the 22,320,066 shares of
common stock of Future outstanding were converted into one share of Bargo's
common stock and each of the 100,000 shares of preferred stock of Future
outstanding were converted into one share of Bargo preferred stock.
The reincorporation merger increased the Company's authorized capital stock from
30.2 million shares to 125 million shares. The articles of incorporation of
Bargo authorize 125 million shares of capital stock, of which 120 million shares
are common stock and 5 million shares are preferred stock. Future's articles of
incorporation authorized 30 million shares of common stock and 200,000 shares of
preferred stock.
In addition to the conversion of the Future common shares into Bargo common
shares and the issuance of common stock as described in Note 2 below, Bargo
converted each of the 100,000 shares of Bargo Series A preferred stock to 260
shares of Bargo common stock (26,000,000 common shares were issued) during the
nine months ended September 30, 1999.
Note 2: PREFERRED STOCK ISSUANCE
On May 14, 1999, the Company closed a transaction pursuant to which it issued
and sold to Kayne Anderson Energy Fund, L.P. ("Kayne"), BancAmerica Capital
Investors SBIC I, L.P. ("BancAmerica"), Eos Partners, L.P., Eos Partners SBIC,
L.P., Eos Partners SBIC II, L.P. (collectively, "Eos"), Energy Capital
Investment Company PLC, EnCap Energy Capital Fund III-B, L.P., BOCP Energy
Partners, L.P., EnCap Energy Capital Fund III, L.P. (collectively, "EnCap") and
SGC Partners II LLC ("SGC" and together with Kayne, BancAmerica, Eos, EnCap and
<PAGE> 9
SGC, the "Investors") shares of a newly created class of preferred stock. Five
million shares of the Company's Cumulative Redeemable Preferred Stock, Series B
("Preferred Stock") were issued in exchange for an aggregate purchase price of
$50 million. As additional consideration, the Company issued an aggregate of
43,815,810 shares of its common stock to the Investors equal to 40% of the
outstanding common stock (on a fully diluted basis). If the Company redeems all
of the outstanding shares of Preferred Stock prior to May 14, 2001, the
Investors must sell back to the Company 12.5% of the shares of Common Stock
originally issued to the Investors.
Dividends on the Preferred Stock equal to 10% per annum are payable quarterly.
The dividend rate is subject to increase (but in no event to more than 16%) or
decrease (but in no event to less than 10%) based upon the Company's ratio of
assets to liabilities which is calculated on January 1 and July 1 of each year
or at such other time as requested by the Investors. As of July 1, 1999 the
dividend rate on the preferred stock is 10%. The Preferred Stock may be redeemed
at any time by the Company and must be redeemed upon the occurrence of certain
events, including upon the fifth anniversary of the issue date or upon a change
of control. The Preferred Stock is redeemable for $50 million and unpaid
cumulative dividends. A change of control is deemed to occur upon any merger,
reorganization, purchase or sale of more than 50% of the Company's voting
securities, the sale of substantially all of the assets of the Company or at any
time Tim Goff ceases to serve as the Company's Chief Executive Officer. The
Company is prohibited from taking certain actions, including authorizing,
creating or issuing any shares of capital stock, amending the articles of
incorporation of the Company and authorizing a merger or change of control,
without the consent of the holders of a majority of the outstanding shares of
Preferred Stock.
As of September 30, 1999, holders of shares of the Series B Preferred were
entitled to receive, when, and if declared by the Board of Directors, as legally
available, cumulative dividends totaling $1,934,543.
Note 3: CREDIT FACILITY
Bargo had an original credit facility which at December 31, 1998 had a
commitment amount of $50 million subject to a borrowing base as determined by
Bank of America on an acquisition by acquisition basis. The Credit Agreement was
comprised of two Tranches, Tranche A and Tranche B.
The Company had a choice of two different interest rates under the Tranche A
loan, the Base Rate or the LIBO Rate. Interest under Base Rate loans were at the
higher of the lender's "Reference Rate" or the Federal Funds Rate plus .5%.
Interest under LIBO Rate loans were at the LIBO rate (reserve adjusted) plus 2%.
The Company could convert any portion of the outstanding debt from one interest
rate type to another in increments of $50,000 with a minimum transfer amount of
$250,000. At December 31, 1998, the Tranche A loan commitment amount was $38
million of which $30.9 million had been borrowed and the Tranche B loan
commitment amount was $12 million, of which $8.945 million had been borrowed. In
connection with the May 14, 1999 equity transaction, on May 17, 1999, the
Company repaid $9.6 million, the full amount then outstanding under Tranche B
and paid down Tranche A to $2.5 million.
<PAGE> 10
On September 30, 1999 the Company amended and restated the Credit Agreement to
increase the commitment from Bank of America and two additional banks to $100
million. The three-year revolver has an initial borrowing base of $40 million
increasing to $55 million upon the resolution of certain preferential purchase
rights associated with the September 1999 Arco East Texas acquisition.
The Company has a choice of two different interest rates; the Base Rate or the
LIBO Rate. The debt bears interest under the Base Rate (which is the higher of
the lender's "Prime Rate" or the Federal Funds Rate plus .5%) plus an applicable
margin of .75%. The debt bears interest under the LIBO Rate at the LIBO rate
(reserve adjusted) plus 1.75%. The Company may convert any portion of the
outstanding debt from one interest rate type to another in increments of
$500,000 with a minimum transfer amount of $1,000,000. Borrowings under the
Credit Agreement are approximately $19.6 million as of September 30, 1999.
Note 4: PROPERTY ACQUISITIONS
On September 13, 1999, the Company acquired interests in 40 leases, a waterflood
unit, over 60 royalty properties and an oil transportation contract in the East
Texas Field from Atlantic Richfield Company. The purchase price was $16 million.
The Company utilized the Credit Facility to acquire the properties.
The following Bargo Energy Company pro forma information gives effect to the
acquisition of the properties as if they had been acquired January 1, 1998:
<TABLE>
<CAPTION>
Nine months ended
September 30
1999 1998
-------------------------
(amounts in thousands except per share amount)
<S> <C> <C>
Revenues $ 20,630 $ 15,815
Net Income (Loss) $ (1,633) $ 1,840
Net Income (Loss) per
Common share -
Basic and Diluted $ (.02) $ .26
</TABLE>
Note 5: STOCK INCENTIVE PLAN
In May 1999 the Board of Directors adopted the 1999 Stock Incentive Plan which
provides for stock options to be granted to employees with exercise prices not
less than the fair market value of the underlying common stock. These options
will have a term of 10 years from the date of grant and will vest over a three
year period from the date of grant. During the nine months ended September 30,
1999 approximately 22 million options were granted under this plan to employees
of the company at exercise prices ranging from $.10 to $.25 per share.
Note 6: EARNINGS (LOSS) PER COMMON SHARE
Net income or loss per common share is based on the weighted average number of
common shares outstanding. The Company's common stock equivalents, which
consisted of stock options and warrants, were antidilutive in the three and nine
months ended September 30, 1999 and 1998.
<PAGE> 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
This report includes "forward looking statements" within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended ("Exchange Act"). All statements other than
statements of historical fact included in the Report (and the exhibits hereto),
including without limitation, statements regarding the Company's financial
position and estimated quantities and net present values of reserves, are
forward looking statements. The Company can give no assurances that the
assumptions upon which such statements are based will prove to have been
correct. Important factors that could cause actual results to differ materially
from the Company's expectations ("Cautionary Statements") are disclosed in the
section "Risk Factors" included in the Company's Forms 10-KSB and other periodic
reports filed under the Exchange Act, which are herein incorporated by
reference. All subsequent written and oral forward looking statements
attributable to the Company or persons acting on its behalf are expressly
qualified by the Cautionary Statements.
THE COMPANY
Bargo Energy Company (the "Company" or "Bargo") is engaged through its
subsidiaries and subsidiary partnerships in the development of oil and natural
gas properties located onshore primarily in the Gulf Coast Region (Texas and
Louisiana) and California. The Company's principal business strategies include
(i) maximizing the value of its existing high-quality, long-life reserves
through efficient operating and marketing practices, (ii) conducting detailed
field studies using the newest technology to identify additional reserves and
exploration potential, and (iii) seeking acquisitions of producing properties,
with exploration and development potential in areas where the Company has
operating experience and expertise. In September 1999 the Company closed a $100
million bank revolving line of credit to supplement its $50 million private
equity financing in May 1999. Bargo and its management team intend to continue
its efforts to aggressively grow the Company's resource base both through oil
and gas property acquisitions and corporate consolidations.
As of December 31, 1998, the Company owned estimated net proved reserves of
approximately 15,145,000 barrels of oil equivalent. Per the Company's July 1,
1999 mid year reserve report the Company owned estimated net proved reserves of
approximately 21,288,000 barrels of oil equivalent. This represents a 40%
increase in total net proved reserves over December 31, 1998. This increase is
attributable to the Company's active acquisition program. Approximately 57% of
the Company's reserves are proved developed producing reserves. Quantities
stated as equivalent barrels of oil reserves are based on a factor of six mcf of
natural gas per barrel of oil.
<PAGE> 12
In August 1999, the Board of Directors increased the size of the Board from
seven to eight members and appointed Jonathan M. Clarkson as a director. Mr.
Clarkson was also appointed President and Chief Operating Officer of the Company
at that time. In November 1999, the Board of Directors appointed Mr. Frank
Pottow as a director, increasing the size of the Board to nine members. Mr.
Pottow is the Managing Director of SGC Partners II, L.L.C., a stockholder of the
Company. In connection with the appointment of Mr. Clarkson and Mr. Pottow to
the Board of Directors, the Shareholders Agreement among the Company and certain
stockholders of the Company was amended to provide that Mr. Clarkson would be
appointed to the Board of Directors and that Mr. Pottow would be appointed as a
representative of SGC Partners.
GENERAL
The Company's revenues, profitability and future growth and the carrying value
of its oil and gas properties are substantially dependent on prevailing prices
of oil and gas and its ability to find, develop and acquire additional oil and
gas reserves that are economically recoverable. The Company's ability to
<PAGE> 13
maintain or increase its borrowing capacity and to obtain additional capital on
attractive terms is also influenced by oil and gas prices.
Prices for oil and gas are subject to large fluctuations in response to
relatively minor changes in the supply of and demand for oil and gas, market
uncertainty and a variety of additional factors beyond the control of the
Company. These factors include weather conditions in the United States, the
condition of the United States economy, the actions of the Organization of
Petroleum Exporting Countries, governmental regulation, political stability in
the Middle East and elsewhere, the foreign supply of crude oil and natural gas,
the price of foreign imports and the availability of alternate fuel sources. Any
substantial and extended decline in the price of crude oil or natural gas would
have an adverse effect on the Company's carrying value of its proved reserves,
borrowing capacity, revenues, profitability and cash flows from operations.
The Company uses the full cost method of accounting for the Company's investment
in oil and gas properties. Under the full cost method of accounting, all costs
of acquisition, exploration and development of oil and gas reserves are
capitalized into a "full cost pool." Oil and gas properties in the pool, plus
estimated future expenditures to develop proved reserves and future abandonment,
site remediation and dismantlement costs, are depleted and charged to operations
using the unit of production method based on the portion of current production
to total estimated proved recoverable oil and gas reserves. To the extent that
such capitalized costs (net of depreciation, depletion and amortization) exceed
the discounted future net cash flows on an after-tax basis of estimated proved
oil and gas reserves, such excess costs are charged to operations. Once
incurred, the write down of oil and gas properties is not reversible at a later
date even if oil or natural gas prices increase.
The Company does not have a specific acquisition budget because of the
unpredictability of the timing and size of forthcoming acquisition activities.
There is no assurance that the Company will be able to identify suitable
acquisition candidates in the future, or that the Company will be successful in
the acquisition of producing properties. In order to finance any possible future
acquisitions, the Company will either use borrowings available under the its
credit facility or the Company may seek to obtain additional debt or equity
financing in the public or private capital markets. Further, there can be no
assurances that any future acquisitions made by the Company will be integrated
successfully into the Company's operations or will achieve desired profitability
objectives.
On September 13, 1999, the Company acquired interests in 40 leases, a waterflood
unit, over 60 royalty properties and an oil transportation contract in the East
Texas Field from Atlantic Richfield Company for $16 million. Current daily
production is approximately 2,500 net barrels of oil equivalent per day from 500
producing wells. The Company utilized the Credit Facility to acquire the
properties.
In June 1998 the Financial Accounting Standards Board issued SFAS 133"
Accounting for Derivative Instruments and Hedging Activities." This standard is
effective for fiscal years beginning after June 15, 1999 (January 1, 2000 for
the Company). SFAS 133 requires that all derivative instruments be recorded on
the balance sheet at their fair value. Changes in the fair value of derivatives
are recorded each period in current earnings or other comprehensive income,
depending on whether a derivative is designated as part of a hedge transaction
and, if it is, the type of hedge transaction. The Company has not yet completed
its evaluation of the impact of the adoption of this new standard.
<PAGE> 14
Company management chooses to implement pricing hedges as necessary to ensure
minimum levels of cash flow or as market conditions create opportunity.
Approximately 50% (or 150,000 MMBTU per month) of current natural gas production
is hedged through calendar year 1999. For the Company's South Coles Levee
production a hedge is in place for 65,000 MMBTU at prices ensuring a floor of
$2.00 per MMBTU and a ceiling of $2.45 per MMBTU based on Southern California
border prices. For the Company's Gulf Coast properties a hedge is in place for
85,000 MMBTU at prices ensuring a floor of $2.00 per MMBTU and a ceiling of
$2.04 per MMBTU based on Houston Ship Channel pricing.
At September 30, 1999 collars were in place for portions of the Company's oil
production for October 1 through September 2000 at floors of $18.00 and ceilings
of $20.75 and $23.08. Contracted volumes total 50,200 barrels per month
declining each month to 42,000 barrels. Beginning October 2000 through September
2001 the Company has two swaps in place at $17.55 and $18.05. Contracted volumes
total 41,350 barrels per month declining to 34,300 barrels per month
representing approximately 50% of the Company's projected oil production.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources of capital are its cash flows from operations,
borrowings, property sales and the issuance of debt and equity securities.
The Company reported consolidated net income of $739,255 for the quarter ended
September 30, 1999 compared to a consolidated net loss of $22,764 for the
quarter ended September 30, 1998. At September 30, 1999, the Company had working
capital of $2,210,865, which was a $1,776,589 increase from the $434,276 of
working capital that the Company had as of September 30, 1998. This increase in
working capital was due primarily to the increased oil and gas sales resulting
from the acquisition of proved reserves referred to above.
Effective August 14, 1998, the Company entered into a credit agreement with Bank
of America ("Credit Agreement"). Borrowings under the Credit Agreement are
secured by mortgages covering substantially all of the Company's producing oil
and gas properties as well as by certain pledges of the Company's subsidiaries
Common Stock. See "The Company." The Credit Agreement initially provided for a
commitment amount of $20 million and a $10.5 million borrowing base ("Borrowing
Base"). This Credit Agreement was amended and increased to $27.5 million on
November 15, 1998. In December 1998, the Company amended and restated the Credit
Agreement to increase the commitment amount to $50 million subject to a
borrowing base as determined by Bank of America on an acquisition by acquisition
basis. On September 30, 1999 the Company amended and restated the Credit
Agreement to increase the commitment from Bank of America and two additional
banks to $100 million. The three-year revolver has an initial borrowing base of
$40 million, increasing to $55 million upon the resolution of certain
preferential purchase rights on the recent Arco East Texas acquisition.
As of September 30, 1999 the Company has available over $20 million under its
existing Credit Agreement which increases to $35 million after resolution
of the preferential rights discussed above.
<PAGE> 15
Operating activities of the Company during the nine months ended September
30,1999 provided net cash of $81,951. In the same period during 1998, operating
activities provided net cash of $116,407. Investing activities in the nine
months ended September 30, 1999, used net cash of $27,549,310, primarily due to
the acquisition of oil and gas properties. For the same period in 1998,
investing activities used net cash of $7,187,420 to acquire oil and gas
properties. Financing activities in the nine months ended September 30, 1999
provided net cash of $27,372,986 primarily due to proceeds from the equity
transaction described above net of debt repayments. In the first nine months of
1998, financing activities provided $7,203,893 (net of debt repayments) which
was used primarily to acquire oil and gas properties.
RESULTS OF OPERATIONS
Comparison of Quarters Ended September 30, 1999 and 1998
Total revenues for the three months ended September 30, 1999 increased to
$4,303,551 from $812,326 for the same period in 1998, primarily due to
increased oil and gas sales from the acquisition of producing properties in the
fourth quarter of 1998 and May of 1999. Production costs increased from $488,305
in the three months ended September 30, 1998 to $1,869,260 in the three months
ended September 30, 1999 due to the purchase of proved reserves. General and
administrative expenses increased to $709,186 from $70,300 in 1998 due to
overhead associated with the Company's increased acquisition activity. The
Company generated net income of $739,255 for the three months ended September
30,1999 compared to a net loss of $22,764 for the same period in 1998, primarily
due to the acquisition of proved reserves and production attributable to such
reserves. The majority of the cash flow generated from these additional reserves
was primarily used to pay interest costs incurred in acquiring the reserves.
Interest expense for the three months ended September 30, 1999 was $221,402
compared to $124,385 for the same period in 1998. Depreciation, depletion and
amortization for the three months ended September 30, 1999 was $386,090. For the
same period in 1998, the total was $166,443. This increase is primarily a result
of increased production volumes.
Comparison of Nine months ended September 30, 1999 and 1998
Total revenues for the nine months ended September 30, 1999 increased to
$9,519,732 from $1,902,855 for the same period in 1998, primarily due to
increased oil and gas sales from the acquisition of producing properties.
Production costs increased from $1,131,754 in the nine months ended September
30, 1998 to $4,187,264 in the nine months ended September 30,1999 due to the
purchase of proved reserves. General and administrative expenses increased to
$2,376,692 from $290,953 in 1998 due to increased overhead associated with the
Company's increased acquisition activity. The Company had a net loss of $809,762
for the nine months ended September 30,1999 compared to a net loss of $181,098
<PAGE> 16
for the same period in 1998, primarily due to increased interest expense
associated with the acquisition of proved reserves. The majority of the cash
flow generated from these additional reserves was primarily used to pay interest
costs. Interest expense for the nine months ended September 30, 1999 was
$1,630,536 compared to $406,511 for the same period in 1998 primarily due to
interest on outstanding long term debt related to property acquisitions.
Depreciation, depletion and amortization for the first nine months of 1999 was
$2,558,658. For the same period in 1998, the total was $368,756. This increase
is primarily a result of increased production volumes.
INFLATION
The Company's activities have not been, and in the near term are not expected to
be, materially affected by inflation or changing prices in general. The
Company's oil exploration and production activities are generally affected by
prevailing prices for oil, however.
YEAR 2000 ISSUE
Year 2000 issues result from the inability of computer programs or computerized
equipment to accurately calculate, store or use a date subsequent to December
31, 1999. The erroneous date can be interpreted in a number of different ways;
typically the Year 2000 is interpreted as the year 1900. This could result in a
system failure or miscalculations causing disruptions of operations, including,
among other things, a temporary inability to process transactions, send invoices
or engage in similar normal business. Because the Company's software systems are
relatively new, the Company was aware of and considered Year 2000 issues at the
time of purchase or development of such systems. In addition, the Company has
recently completed an assessment of its core financial and operational software
systems to ensure compliance. The licensor of the Company's core financial
software system has certified that such software is Year 2000 compliant.
Additionally, other less critical software systems and various types of
equipment have been assessed and are believed to be compliant.
The Company believes that the potential impact, if any, of these less critical
systems not being Year 2000 compliant will at most require employees to manually
complete otherwise automated tasks or calculations and it should not impact the
Company's ability to continue exploration, drilling, production or sales
activities. The Company has initiated and will continue to have formal
communications with its significant suppliers, business partners and customers
to determine the extent to which the Company is vulnerable to those third
parties' failure to correct their own Year 2000 issues. There can be no
guarantee, however, that the systems of other companies on which the Company's
systems rely will be timely converted, or that a failure to convert by another
company, or a conversion that is incompatible with the Company's systems would
not have a material adverse effect on the Company.
The Company has determined it has no exposure to contingencies related to the
Year 2000 issue with respect to products sold to third parties. The Company has
and will utilize both internal and external resources to complete tasks and
perform testing necessary to address the Year 2000 issue. The Company has
substantially completed the Year 2000 project. The Company has not incurred, and
does not anticipate that it will incur, any significant costs relating to the
assessment and remediation of Year 2000 issues.
<PAGE> 17
PART II
OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
EXHIBIT NUMBER TITLE OF DOCUMENT
2. Plan of acquisition, reorganization,
arrangement, liquidation or succession
2.1 Purchase and Sale Agreement between Exxon
Corporation and Future Acquisition 1995, Ltd.,
et al. (Incorporated by reference from Exhibit
2.1 to the Company's Quarterly Report on Form
10-Q for the period ended June, 30, 1999, filed
with the Securities and Exchange Commission on
August 16, 1999)
2.2 Purchase and Sale Agreement by and Between
Atlantic Richfield Company and Future
Acquisition 1995, Ltd.
3. Articles of Incorporation and By-laws
3.1 Articles of Incorporation of Bargo Energy
Company (Incorporated by reference from Exhibit
3.1 to the Company's Current Report on Form 8-K
dated April 26, 1999, filed with the Securities
and Exchange Commission on April 29, 1999)
3.2 Agreement and Plan of Merger, dated as of April
6, 1999 between Future Petroleum Corporation and
FPT Corporation (Incorporated by reference from
Exhibit 2.1 to the Company's Current Report on
Form 8-K dated April 26, 1999, filed with the
Securities and Exchange Commission on April 29,
1999)
3.3 By-laws of Bargo Energy Company (Incorporated by
reference from Exhibit 3.2 to the Company's
Current Report on Form 8-K dated April 26, 1999,
filed with the Securities and Exchange
Commission on April 29, 1999)
3.4 Amendment to Bargo Energy Company By-laws
(Incorporated by reference from Exhibit 3.4 to
the Company's Quarterly Report on Form 10-QSB
for the period ended March 31, 1999, filed with
the Securities and Exchange Commission on May
21, 1999)
4. Instruments defining the rights of security
holders
<PAGE> 18
EXHIBIT NUMBER TITLE OF DOCUMENT
4.1 Certificate of Designations of Cumulative
Redeemable Preferred Stock, Series B
(Incorporated by reference (Incorporated by
reference from Exhibit 4.1 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10. Material Contracts
10.1 Second Amended and Restated Shareholders'
Agreement, dated May 14, 1999, by and among
Bargo Energy Company, B. Carl Price, Don Wm.
Reynolds, Energy Capital Investment Company PLC,
EnCap Equity 1994 Limited Partnership, Bargo
Energy Resources, Ltd., TJG Investments, Inc.,
Bargo Energy Company, Tim J. Goff, Thomas
Barrow, James E. Sowell, Bargo Operating
Company, Inc., EnCap Energy Capital Fund III-B,
L.P., BOCP Energy Partners, L.P., EnCap Energy
Capital Fund III, L.P., Kayne Anderson Energy
Fund, L.P., BancAmerica Capital Investors SBIC
I, L.P., Eos Partners, L.P., Eos Partners SBIC,
L.P., Eos Partners SBIC II, L.P., and SGC
Partners II LLC. (Incorporated by reference from
Exhibit 10.1 to the Company's Quarterly Report
on Form 10-QSB for the period ended March 31,
1999, filed with the Securities and Exchange
Commission on May 21, 1999)
10.2 Second Amendment to Registration Rights
Agreement dated May 14, 1999 between Energy
Capital Investment Company PLC, EnCap Equity
1994 Limited Partnership, EnCap Energy Capital
Fund III-B, L.P., BOCP Energy Partners, L.P.,
EnCap Energy Capital Fund III, L.P., Kayne
Anderson Energy Fund, L.P., BancAmerica Capital
Investors SBIC I, L.P., Eos Partners, L.P., Eos
Partners SBIC, L.P., Eos Partners SBIC II, L.P.,
and SGC Partners II LLC. (Incorporated by
reference from Exhibit 10.2 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10.3 Consent to Amendment to Registration Rights
Agreement by TJG Investments, Inc., Bargo Energy
Company, Bargo Energy Resources, Ltd., Bargo
Operating Company, Inc., Tim J. Goff, Thomas
Barrow, James E. Sowell, B. Carl Price, Don Wm.
Reynolds, Christie Price, Robert Price and
Charles D. Laudeman (Incorporated by reference
from Exhibit 10.3 to the Company's Quarterly
Report on Form 10-QSB for the period ended March
31, 1999, filed with the Securities and Exchange
Commission on May 21, 1999)
10.4 Consent and Agreement dated May 14, 1999 be
between Bargo Energy Company and Bank of America
National Trust and Savings Association
(Incorporated by reference from Exhibit 10.6 to
the Company's Quarterly Report on Form 10-QSB
for the
<PAGE> 19
EXHIBIT NUMBER TITLE OF DOCUMENT
period ended March 31, 1999, filed with the
Securities and Exchange Commission on May 21,
1999)
10.5 SBA Side Letter dated May 14, 1999 between Bargo
Energy Company and BancAmerica Capital Investors
SBIC I, L.P., Eos Partners SBIC, L.P., Eos
Partners SBIC II, L.P., and SGC Partners II LLC.
(Incorporated by reference from Exhibit 10.7 to
the Company's Quarterly Report on Form 10-QSB
for the period ended March 31, 1999, filed with
the Securities and Exchange Commission on May
21, 1999)
10.6 SBA Side Letter dated May 14, 1999 between Bargo
Energy Company, EnCap Equity 1994 Limited
Partnership, TJG Investments, Inc. Bargo Energy
Company, Bargo Energy Resources, Ltd., Bargo
Operating Company, Inc., Tim J. Goff and
BancAmerica Capital Investors SBIC I, L.P., Eos
Partners SBIC, L.P., Eos Partners SBIC II, L.P.,
and SGC Partners II LLC. (Incorporated by
reference from Exhibit 10.8 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10.7 Stock Purchase Agreement dated May 14, 1999
between Bargo Energy Company and Energy Capital
Investment Company PLC, EnCap Energy Capital
Fund III-B, L.P., BOCP Energy Partners, L.P.,
EnCap Energy Capital Fund III, L.P., Kayne
Anderson Energy Fund, L.P., BancAmerica Capital
Investors SBIC I, L.P., Eos Partners, L.P., Eos
Partners SBIC, L.P., Eos Partners SBIC II, L.P.,
and SGC Partners II LLC. (Incorporated by
reference from Exhibit 10.9 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10.8 Bargo Energy Company 1999 Stock Incentive Plan
(Incorporated by reference from Exhibit 10.10 to
the Company's Quarterly Report on Form 10-QSB
for the period ended March 31, 1999, filed with
the Securities and Exchange Commission on May
21, 1999)
10.9 Confidentiality and Non-compete Agreement dated
May 14, 1999 between Bargo Energy Company and
Tim J. Goff (Incorporated by reference from
Exhibit 10.11 to the Company's Quarterly Report
on Form 10-QSB for the period ended March 31,
1999, filed with the Securities and Exchange
Commission on May 21, 1999)
10.10 Second Amended and Restated Credit Agreement,
Dated as of September 30, 1999, among Bargo
Energy Company, Bank of America, N.A. and
Certain Financial Institutions
<PAGE> 20
EXHIBIT NUMBER TITLE OF DOCUMENT
10.11 Registration Rights Agreement among the Company
and Bargo Energy Resources, Ltd. dated August
14, 1998 (Incorporated by reference from Exhibit
10.1 to the Company's Quarterly Report on Form
10-Q for the period ended June 30, 1998, filed
with the Securities and Exchange Commission on
August 25, 1998)
10.12 First Amendment to Registration Rights Agreement
among the Company, Bargo Energy Resources, Ltd.,
Bargo Energy Company, TJG Investments, Inc. and
certain other shareholders dated December 15,
1998 (Incorporated by reference from Exhibit
99.2 to the Company's Current Report on Form 8-K
dated December 15, 1998, filed with the
Securities and Exchange Commission on December
30, 1998)
10.13 Registration Rights Agreement dated November 25,
1997, among the Company, Energy Capital
Investment Company PLC, and EnCap Equity 1994
Limited Partnership (Incorporated by reference
from Exhibit 10.05 to the Company's Current
Report on Form 8-K dated November 25, 1997,
filed with the Securities and Exchange
Commission on December 10, 1997)
10.14 Registration Rights Agreement among the Company,
Energy Capital Investment Company PLC and EnCap
Equity 1994 Limited Partnership dated August 14,
1998 (Incorporated by reference from Exhibit
10.2 to the Company's Quarterly Report on Form
10-Q for the period ended June 30, 1998, filed
with the Securities and Exchange Commission on
August 25, 1998)
10.15 First Amendment to Registration Rights Agreement
among the Company, Energy Capital Investment
Company PLC and EnCap Equity 1994 Limited
Partnership dated December 15, 1998
(Incorporated by reference from Exhibit 99.4 to
the Company's Current Report on Form 8-K dated
December 15, 1998, filed with the Securities and
Exchange Commission on December 30, 1998)
10.16 Registration Rights Agreement among the Company,
B. Carl Price and certain other shareholders
dated August 14, 1998 (Incorporated by reference
from Exhibit 10.3 to the Company's Quarterly
Report on Form 10-Q for the period ended June
30, 1998, filed with the Securities and Exchange
Commission on August 25, 1998)
10.17 First Amendment to Registration Rights Agreement
among the Company, B. Carl Price and certain
other shareholders dated December 15, 1998
(Incorporated by reference from Exhibit 99.6 to
the Company's Current Report on Form 8-K dated
December 15, 1998, filed with the Securities and
Exchange Commission on December 30, 1998)
<PAGE> 21
EXHIBIT NUMBER TITLE OF DOCUMENT
10.18 Stock Purchase Warrant by the Company to Bargo
Energy Resources, Ltd. dated August 14, 1998
(Incorporated by reference from Exhibit 10.4 to
the Company's Quarterly Report on Form 10-Q for
the period ended June 30, 1998, filed with the
Securities and Exchange Commission on August 25,
1998)
10.19 1993 Employee Incentive Plan (Incorporated by
reference from the Company's Annual Report on
Form 10-K for the fiscal year ended December 30,
1993, filed with the Securities and Exchange
Commission on May 20, 1994)
10.20 First Amendment to Second Amended and Restated
Shareholders' Agreement, dated August 11, 1999
11. Statement regarding computation of per share
earnings(1)
15. Letter on unaudited interim financial
information(1)
18. Letter on change in accounting principles(1)
19. Report furnished to security holders(1)
22. Published report regarding matters submitted to
vote(1)
24. Power of attorney (1)
27. Financial data schedule
99. Additional exhibits
- -----------------------------------
(1) Inapplicable to this filing.
(b) Reports on Form 8-K.
The following reports on Form 8-K were filed during the quarterly
period ended September 30, 1999:
1) Current Report on Form 8-K dated August 17, 1999, filed August 24, 1999
reporting Item 5. Other Events and Item 7. Financial Statements and
Exhibits.
2) Current Report on Form 8-K dated September 8, 1999, filed October 12,
1999 reporting Item 2. Acquisition or Disposition of Assets and Item 7.
Financial Statements and Exhibits.
<PAGE> 22
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
BARGO ENERGY COMPANY
(Registrant)
By: /s/ Kimberly G. Seekely
Kimberly G. Seekely,
On behalf of the Registrant and
as Vice President - Treasurer
<PAGE> 23
The following exhibits are included as part of this report:
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NUMBER TITLE OF DOCUMENT
-------------- -----------------
<S> <C>
2. Plan of acquisition, reorganization,
arrangement, liquidation or succession
2.1 Purchase and Sale Agreement between Exxon
Corporation and Future Acquisition 1995, Ltd.,
et al. (Incorporated by reference from Exhibit
2.1 to the Company's Quarterly Report on Form
10-Q for the period ended June, 30, 1999, filed
with the Securities and Exchange Commission on
August 16, 1999)
2.2 Purchase and Sale Agreement by and Between
Atlantic Richfield Company and Future
Acquisition 1995, Ltd.
3. Articles of Incorporation and By-laws
3.1 Articles of Incorporation of Bargo Energy
Company (Incorporated by reference from Exhibit
3.1 to the Company's Current Report on Form 8-K
dated April 26, 1999, filed with the Securities
and Exchange Commission on April 29, 1999)
3.2 Agreement and Plan of Merger, dated as of April
6, 1999 between Future Petroleum Corporation and
FPT Corporation (Incorporated by reference from
Exhibit 2.1 to the Company's Current Report on
Form 8-K dated April 26, 1999, filed with the
Securities and Exchange Commission on April 29,
1999)
3.3 By-laws of Bargo Energy Company (Incorporated by
reference from Exhibit 3.2 to the Company's
Current Report on Form 8-K dated April 26, 1999,
filed with the Securities and Exchange
Commission on April 29, 1999)
3.4 Amendment to Bargo Energy Company By-laws
(Incorporated by reference from Exhibit 3.4 to
the Company's Quarterly Report on Form 10-QSB
for the period ended March 31, 1999, filed with
the Securities and Exchange Commission on May
21, 1999)
4. Instruments defining the rights of security
holders
4.1 Certificate of Designations of Cumulative
Redeemable Preferred Stock, Series B
(Incorporated by reference (Incorporated by
reference from Exhibit 4.1 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10. Material Contracts
</TABLE>
<PAGE> 24
<TABLE>
<CAPTION>
EXHIBIT NUMBER TITLE OF DOCUMENT
-------------- -----------------
<S> <C>
10.1 Second Amended and Restated Shareholders'
Agreement, dated May 14, 1999, by and among
Bargo Energy Company, B. Carl Price, Don Wm.
Reynolds, Energy Capital Investment Company PLC,
EnCap Equity 1994 Limited Partnership, Bargo
Energy Resources, Ltd., TJG Investments, Inc.,
Bargo Energy Company, Tim J. Goff, Thomas
Barrow, James E. Sowell, Bargo Operating
Company, Inc., EnCap Energy Capital Fund III-B,
L.P., BOCP Energy Partners, L.P., EnCap Energy
Capital Fund III, L.P., Kayne Anderson Energy
Fund, L.P., BancAmerica Capital Investors SBIC
I, L.P., Eos Partners, L.P., Eos Partners SBIC,
L.P., Eos Partners SBIC II, L.P., and SGC
Partners II LLC. (Incorporated by reference from
Exhibit 10.1 to the Company's Quarterly Report
on Form 10-QSB for the period ended March 31,
1999, filed with the Securities and Exchange
Commission on May 21, 1999)
10.2 Second Amendment to Registration Rights
Agreement dated May 14, 1999 between Energy
Capital Investment Company PLC, EnCap Equity
1994 Limited Partnership, EnCap Energy Capital
Fund III-B, L.P., BOCP Energy Partners, L.P.,
EnCap Energy Capital Fund III, L.P., Kayne
Anderson Energy Fund, L.P., BancAmerica Capital
Investors SBIC I, L.P., Eos Partners, L.P., Eos
Partners SBIC, L.P., Eos Partners SBIC II, L.P.,
and SGC Partners II LLC. (Incorporated by
reference from Exhibit 10.2 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10.3 Consent to Amendment to Registration Rights
Agreement by TJG Investments, Inc., Bargo Energy
Company, Bargo Energy Resources, Ltd., Bargo
Operating Company, Inc., Tim J. Goff, Thomas
Barrow, James E. Sowell, B. Carl Price, Don Wm.
Reynolds, Christie Price, Robert Price and
Charles D. Laudeman (Incorporated by reference
from Exhibit 10.3 to the Company's Quarterly
Report on Form 10-QSB for the period ended March
31, 1999, filed with the Securities and Exchange
Commission on May 21, 1999)
10.4 Consent and Agreement dated May 14, 1999 be
between Bargo Energy Company and Bank of America
National Trust and Savings Association
(Incorporated by reference from Exhibit 10.6 to
the Company's Quarterly Report on Form 10-QSB
for the period ended March 31, 1999, filed with
the Securities and Exchange Commission on May
21, 1999)
10.5 SBA Side Letter dated May 14, 1999 between Bargo
Energy Company and BancAmerica Capital Investors
SBIC I, L.P., Eos Partners SBIC, L.P., Eos
Partners SBIC II, L.P., and SGC Partners
</TABLE>
<PAGE> 25
<TABLE>
<CAPTION>
EXHIBIT NUMBER TITLE OF DOCUMENT
-------------- -----------------
<S> <C>
II LLC. (Incorporated by reference from Exhibit
10.7 to the Company's Quarterly Report on Form
10-QSB for the period ended March 31, 1999,
filed with the Securities and Exchange
Commission on May 21, 1999)
10.6 SBA Side Letter dated May 14, 1999 between Bargo
Energy Company, EnCap Equity 1994 Limited
Partnership, TJG Investments, Inc. Bargo Energy
Company, Bargo Energy Resources, Ltd., Bargo
Operating Company, Inc., Tim J. Goff and
BancAmerica Capital Investors SBIC I, L.P., Eos
Partners SBIC, L.P., Eos Partners SBIC II, L.P.,
and SGC Partners II LLC. (Incorporated by
reference from Exhibit 10.8 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10.7 Stock Purchase Agreement dated May 14, 1999
between Bargo Energy Company and Energy Capital
Investment Company PLC, EnCap Energy Capital
Fund III-B, L.P., BOCP Energy Partners, L.P.,
EnCap Energy Capital Fund III, L.P., Kayne
Anderson Energy Fund, L.P., BancAmerica Capital
Investors SBIC I, L.P., Eos Partners, L.P., Eos
Partners SBIC, L.P., Eos Partners SBIC II, L.P.,
and SGC Partners II LLC. (Incorporated by
reference from Exhibit 10.9 to the Company's
Quarterly Report on Form 10-QSB for the period
ended March 31, 1999, filed with the Securities
and Exchange Commission on May 21, 1999)
10.8 Bargo Energy Company 1999 Stock Incentive Plan
(Incorporated by reference from Exhibit 10.10 to
the Company's Quarterly Report on Form 10-QSB
for the period ended March 31, 1999, filed with
the Securities and Exchange Commission on May
21, 1999)
10.9 Confidentiality and Non-compete Agreement dated
May 14, 1999 between Bargo Energy Company and
Tim J. Goff (Incorporated by reference from
Exhibit 10.11 to the Company's Quarterly Report
on Form 10-QSB for the period ended March 31,
1999, filed with the Securities and Exchange
Commission on May 21, 1999)
10.10 Second Amended and Restated Credit Agreement,
Dated as of September 30, 1999, among Bargo
Energy Company, Bank of America, N.A. and
Certain Financial Institutions
10.11 Registration Rights Agreement among the Company
and Bargo Energy Resources, Ltd. dated August
14, 1998 (Incorporated by reference from Exhibit
10.1 to the Company's Quarterly Report on Form
10-Q for the period ended June 30, 1998, filed
with the Securities and Exchange Commission on
August 25, 1998)
</TABLE>
<PAGE> 26
<TABLE>
<CAPTION>
EXHIBIT NUMBER TITLE OF DOCUMENT
-------------- -----------------
<S> <C>
10.12 First Amendment to Registration Rights Agreement
among the Company, Bargo Energy Resources, Ltd.,
Bargo Energy Company, TJG Investments, Inc. and
certain other shareholders dated December 15,
1998 (Incorporated by reference from Exhibit
99.2 to the Company's Current Report on Form 8-K
dated December 15, 1998, filed with the
Securities and Exchange Commission on December
30, 1998)
10.13 Registration Rights Agreement dated November 25,
1997, among the Company, Energy Capital
Investment Company PLC, and EnCap Equity 1994
Limited Partnership (Incorporated by reference
from Exhibit 10.05 to the Company's Current
Report on Form 8-K dated November 25, 1997,
filed with the Securities and Exchange
Commission on December 10, 1997)
10.14 Registration Rights Agreement among the Company,
Energy Capital Investment Company PLC and EnCap
Equity 1994 Limited Partnership dated August 14,
1998 (Incorporated by reference from Exhibit
10.2 to the Company's Quarterly Report on Form
10-Q for the period ended June 30, 1998, filed
with the Securities and Exchange Commission on
August 25, 1998)
10.15 First Amendment to Registration Rights Agreement
among the Company, Energy Capital Investment
Company PLC and EnCap Equity 1994 Limited
Partnership dated December 15, 1998
(Incorporated by reference from Exhibit 99.4 to
the Company's Current Report on Form 8-K dated
December 15, 1998, filed with the Securities and
Exchange Commission on December 30, 1998)
10.16 Registration Rights Agreement among the Company,
B. Carl Price and certain other shareholders
dated August 14, 1998 (Incorporated by reference
from Exhibit 10.3 to the Company's Quarterly
Report on Form 10-Q for the period ended June
30, 1998, filed with the Securities and Exchange
Commission on August 25, 1998)
10.17 First Amendment to Registration Rights Agreement
among the Company, B. Carl Price and certain
other shareholders dated December 15,
1998(Incorporated by reference from Exhibit 99.6
to the Company's Current Report on Form 8-K
dated December 15, 1998, filed with the
Securities and Exchange Commission on December
30, 1998)
10.18 Stock Purchase Warrant by the Company to Bargo
Energy Resources, Ltd. dated August 14, 1998
(Incorporated by reference from Exhibit 10.4 to
the Company's Quarterly Report on Form 10-Q for
the period ended June 30, 1998, filed with the
Securities and Exchange Commission on August 25,
1998)
</TABLE>
<PAGE> 27
<TABLE>
<CAPTION>
EXHIBIT NUMBER TITLE OF DOCUMENT
-------------- -----------------
<S> <C>
10.19 1993 Employee Incentive Plan (Incorporated by
reference from the Company's Annual Report on
Form 10-K for the fiscal year ended December 30,
1993, filed with the Securities and Exchange
Commission on May 20, 1994)
10.20 First Amendment to Second Amended and Restated
Shareholders' Agreement, dated August 11, 1999
11. Statement regarding computation of per share earnings(1)
15. Letter on unaudited interim financial information(1)
18. Letter on change in accounting principles(1)
19. Report furnished to security holders(1)
22. Published report regarding matters submitted to vote(1)
24. Power of attorney(1)
27. Financial data schedule
99. Additional exhibits
</TABLE>
- -----------------------------------
(1) Inapplicable to this filing.
<PAGE> 1
PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
ATLANTIC RICHFIELD COMPANY
A DELAWARE CORPORATION,
AND
FUTURE ACQUISITION 1995, LTD.
A TEXAS LIMITED PARTNERSHIP
DATED
AUGUST 3, 1999
EFFECTIVE
OCTOBER 1, 1999
<PAGE> 2
EXHIBITS
A - Leasehold Interests and Allocated Values
B - Excluded Assets
2.2 - Gas Production Imbalances
3.4 - Form of Title Defect Notice
3.6 - Allocation of Value
4.7 - Material Changes in Last Year
4.9 - Material Defects
4.16 - Pending and Proposed Operations and Capital Projects
9.6 - Litigation
10.2(a) - Form of Conveyance, Assignment and Bill of Sale
10.2(d) - Form of Property Transfer Accounting Agreement
10.2(l) - Form of Surface Lease Agreement
Page 2
<PAGE> 3
SCHEDULE OF DEFINED TERMS
<TABLE>
<CAPTION>
Term Where Defined
- ---- -------------
<S> <C>
Adjusted Purchase Price.....................................Section 2.2
Adjustment Amount...........................................Section 2.2(b)(v)
Agreement...................................................Heading
Allocated Value.............................................Section 3.6
ARCO........................................................Heading
ARCO Indemnified Parties....................................Section 7.4
Assets......................................................Section 1.1
Assumed Obligations.........................................Section 11.4(a)
Business Days...............................................Section 2.3(a)
CERCLA......................................................Section 16.3
Claimant....................................................Section 13.5(b)
Claims......................................................Section 16.2
Closing.....................................................Section 10.1
Closing Date................................................Section 10.1
Code........................................................Section 4.5
Data........................................................Section 1.1(c)
Defect Value................................................Section 3.4
Deposit.....................................................Section 2.1(c)
Documents...................................................Section 14.1
Effective Date..............................................Section 1.1
Environmental Laws..........................................Section 16.3
Environmental Reports.......................................Section 16.1
Estimated Adjusted Purchase Price...........................Section 2.3(b)
Excluded Assets.............................................Section 1.1(b)
Indemnitor..................................................Section 13.5(b)
Interim Period..............................................Section 6.2
Leasehold Interests.........................................Section 1.1(a)
Losses......................................................Section 11.4(b)
Marketable Title............................................Section 3.2
Material Agreements.........................................Section 4.8
Notification Deadline.......................................Section 3.4
OSHA........................................................Section 16.3
Permitted Encumbrances......................................Section 3.3
Prior Confidentiality Agreements............................Section 7.2
Property....................................................Section 3.2(b)
Property Taxes..............................................Section 13.1
Purchase Price..............................................Section 2.1(a)
Purchaser...................................................Heading
Purchaser Indemnified Parties...............................Section 11.4(c)
RCRA........................................................Section 16.3
Records.....................................................Section 1.1(d)
SARA........................................................Section 16.3
Title Defect................................................Section 3.4
Title Increase..............................................Section 3.5(c)
Valued Assets...............................................Section 3.2
</TABLE>
Page 3
<PAGE> 4
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement ("Agreement") is made and entered into
this 3rd day of August, 1999, by and between ATLANTIC RICHFIELD COMPANY, a
Delaware corporation ("ARCO"), and FUTURE ACQUISITION 1995, LTD., a Texas
limited partnership ("PURCHASER").
RECITALS
ARCO desires to sell to Purchaser, and Purchaser desires to purchase
from ARCO, certain oil and gas properties and related assets on the terms and
conditions set forth in this Agreement,
NOW, THEREFORE, for and in consideration of the premises and of the
mutual covenants and agreements contained herein, ARCO and Purchaser hereby
agree as follows:
ARTICLE 1 - PURCHASE AND SALE
1.1 PURCHASE AND SALE OF ASSETS. On the Closing Date, but effective as
of 7:00 a.m. Central Time, October 1, 1999 (the "Effective Date"), subject to
the terms and conditions of this Agreement, ARCO agrees to sell and convey to
Purchaser, and Purchaser agrees to purchase and pay for, all of ARCO's right,
title and interest in and to the following assets (the "Assets"):
(a) The oil, gas and mineral leasehold estates and other real property
and mineral interests described in Exhibit A, together with all of
ARCO's rights in respect of any pooled, communitized or unitized
acreage of which any such interest is a part (collectively, the
"Leasehold Interests");
(b) To the extent same are specifically attributable or allocable to
the Leasehold Interests, (i) all wells, equipment and facilities that,
as of the Closing Date, are located on and used solely and directly in
connection with the production or treatment of oil and gas from the
Leasehold Interests, (ii) all oil and gas and other hydrocarbon
volumes produced on or after the Effective Date, (iii) to the extent
same are assignable or transferable by ARCO without restriction under
applicable law or third-party agreements (without the payment of any
funds or other consideration), all orders, contracts, agreements and
other instruments (excluding any instruments subject or relating to
attorney/ client privilege), (iv) to the extent same are assignable
or transferable by ARCO under applicable law or third-party agreements
(without the payment of any funds or other consideration), all
easements, authorizations, permits and similar rights and interests,
and (v) all other rights, privileges, benefits, powers and obligations
conferred or imposed upon the owner and holder of the Leasehold
Interests;
(c) Any and all mineral fee interests, mineral servitudes, royalty
interests, overriding royalty interests, net profits interests,
production payments and all other interests of every kind and
character in and to the properties and lands described on Exhibit A
and/or which relate to the Leasehold Interests, the lands covered
thereby or the production of hydrocarbons therefrom;
(d) All office buildings, warehouses, other buildings and permanent
improvements, surface leases, vehicles, trucks, warehouse inventory,
parts, supplies, office furniture, fixtures and equipment, computers,
printers, telephone systems and all other tangible assets used or held
for use in connection with ARCO's ownership or operation of the
Leasehold Interests and other Assets;
(e) That certain Crude Oil Buy/Sell Contract made and entered into
effective December 1, 1995, by and between ARCO Permian, a unit of
Atlantic Richfield Company, and Sun Company, Inc. (R&M), as amended
from time to time, insofar as applicable to the Leasehold Interests;
(f) All casing leak allowable transfers, earned salt water allowables,
key well allowable transfers and similar rights and interests related
to or arising out of the Leasehold Interests and the production of and
rights to produce hydrocarbons therefrom; and
(g) To the extent same are specifically attributable or allocable to
the Leasehold Interests, originals, to the extent available, or copies
of the following records: (i) lease and land records, (ii) development
geological records, (iii) operations, production and engineering
records, and (iv) facility and well records, in each case excluding
any exploration geological records, any interpretive or forecast data,
any records subject or relating to attorney/client privilege and any
such records or data that are not assignable pursuant to the terms of
applicable law or third-party agreements (without the payment of any
funds or other consideration) (collectively, the "Records").
SAVE AND EXCEPT the assets and properties described in Exhibit B and
any other assets and properties excluded pursuant to the terms hereof, and all
other property, real, personal or intellectual, not expressly covered herein in
Section 1.1 (the "Excluded Assets").
Purchase and Sale Agreement Page 4
<PAGE> 5
ARTICLE 2 - PURCHASE PRICE
2.1 PURCHASE PRICE; METHOD OF PAYMENT; DEPOSIT
(a) The purchase price for the Assets shall be $16,000,000.00 (the
"Purchase Price"), which amount shall be adjusted as provided in
Section 2.2.
(b) All amounts required under this Article 2 to be paid by any party
hereto to another party hereto shall be made by wire transfer of
immediately available funds to an account designated by the payee
thereof, which designation shall be made not later than two Business
Days prior to the date such payment is due.
(c) On July 21, 1999, Purchaser paid to ARCO, and ARCO acknowledges
receipt of, a performance deposit in the amount of $2,000,000.00 (the
"Deposit"), which amount shall be held by ARCO and distributed as
follows:
(i) if this Agreement is terminated as provided in Section
12.1(a) or Section 12.1(b), the Deposit shall be returned by
ARCO to Purchaser;
(ii) if this Agreement is terminated by either party pursuant
to the termination right provided in Section 12.1(c) and at
such time all of Purchaser's conditions to Closing as set
forth in Article 9 have not been satisfied or waived (and such
failure is not due to a breach by Purchaser of its obligations
hereunder), the Deposit shall be returned by ARCO to
Purchaser;
(iii) if this Agreement is terminated by either party pursuant
to the termination right provided in Section 12.1(c) and at
such time all of Purchaser's conditions to Closing as set
forth in Article 9 have been satisfied or waived, the Deposit
shall be retained by ARCO; and
(iv) if Closing occurs, ARCO shall apply the Deposit towards
the Purchase Price.
ARCO and Purchaser acknowledge and agree that until ARCO is obligated
to distribute the Deposit as provided above, ARCO may invest the
Deposit in such investments as it deems appropriate and any income
resulting therefrom shall be the property of ARCO and not Purchaser.
(d) Purchaser further acknowledges and agrees that if ARCO becomes
entitled to the Deposit pursuant to the provisions of Section
2.1(c)(iii), ARCO's damages under such circumstances would be difficult
to ascertain and ARCO shall be entitled to liquidated damages in an
amount equal to the Deposit. Accordingly, the retention by ARCO of the
Deposit as provided in Section 2.1(c)(iii) above shall be deemed to
constitute the payment by Purchaser to ARCO of such liquidated damages,
but in no event shall such retention of the Deposit or deemed payment
of liquidated damages constitute or be construed as a penalty. If ARCO
becomes entitled to retain the Deposit pursuant to Section 2.1(c)(iii)
above, such retention shall constitute the sole remedy of ARCO under
this Agreement for Purchaser's failure to consummate the transactions
contemplated hereunder (such limitation shall not limit the rights of
ARCO under any of the provisions of this Agreement that survive a
termination and continue in full force and effect pursuant to Section
12.2).
2.2 ADJUSTMENTS TO PURCHASE PRICE. The Purchase Price for the Assets
shall be adjusted as follows (the resulting amount being herein referred to as
the "Adjusted Purchase Price"):
(a) The Purchase Price shall be increased by an amount equal to the sum
of the following amounts (determined without duplication and on an
accrual basis in accordance with generally accepted accounting
principles consistently applied):
(i) the amount of all expenses (net to ARCO's interest)
incurred and paid or to be paid by or on behalf of ARCO that
are attributable to the ownership or operation of the Assets
and to the period of time from and after the Effective Date,
including without limitation, capital expenditures, royalties,
ad valorem, property and similar taxes and assessments,
severance, sales and production taxes (but excluding income
taxes and franchise taxes), rentals and similar charges,
amounts billed under applicable operating agreements and
prepaid expenses; and
(ii) an amount equal to the value allocated to all Title
Increases in accordance with Section 3.5(c).
(b) The Purchase Price shall be decreased by an amount equal to the sum
of the following amounts (determined without duplication and on an
accrual basis in accordance with generally accepted accounting
principles consistently applied):
(i) the amount of all proceeds (net to ARCO's interest) earned
and received or to be received by or on behalf of ARCO (other
than proceeds from the exercise by third parties of
preferential rights to purchase all or any portion of the
Leasehold Interests) that are attributable to the ownership or
operation of the Assets after the Effective Date and to the
Purchase and Sale Agreement Page 5
<PAGE> 6
period of time from and after the Effective Date, it being
agreed that such amount shall not include proceeds from the
sale subsequent to the Effective Date of merchantable
hydrocarbons in storage above the pipeline connection at the
Effective Date;
(ii) an amount equal to the value of all Title Defects and
excluded Leasehold Interests as determined in accordance with
Sections 3.4-3.7; and
(iii) an amount equal to the value of the Leasehold Interests
with respect to which preferential purchase rights have been
exercised prior to Closing in accordance with Section 3.9.
2.3 PAYMENT AND CALCULATION OF ESTIMATED ADJUSTED PURCHASE PRICE;
PAYMENT AT CLOSING.
(a) ARCO shall prepare and deliver to Purchaser, at least three
"Business Days" (which term shall mean any day except a Saturday,
Sunday or other day on which commercial banks in New York, New York, or
Dallas, Texas are required or authorized by law to be closed) prior to
the Closing Date, ARCO's estimate of the Adjusted Purchase Price to be
paid at Closing, together with a statement setting forth ARCO's
estimate of the amount of each adjustment to the Purchase Price to be
made pursuant to Section 2.2. The parties shall negotiate in good faith
and attempt to agree on such estimated adjustments prior to Closing. In
the event any estimated adjustment amounts are not agreed upon prior to
Closing, the estimate of the Adjusted Purchase Price for purposes of
Closing shall be calculated based on ARCO's and Purchaser's agreed upon
estimated adjustments.
(b) At Closing, Purchaser shall pay to ARCO the estimated Adjusted
Purchase Price determined as set forth in Section 2.3(a) (such
estimated Adjusted Purchase Price being herein referred to as the
"Estimated Adjusted Purchase Price"), less an amount equal to the
Deposit.
2.4 POST-CLOSING ADJUSTMENT. Within five Business Days after the final
determination of the Adjusted Purchase Price in accordance with Section 11.1 or
otherwise, Purchaser shall pay to ARCO or ARCO shall pay to Purchaser, as the
case may be, the amount by which such final Adjusted Purchase Price is greater
than or less than, respectively, the Estimated Adjusted Purchase Price.
2.5 ALLOCATION OF PURCHASE PRICE. ARCO and Purchaser agree to the
following allocation of the Purchase Price among the Assets sold hereunder based
upon the estimated value for federal income tax purposes of the Assets as of the
Closing Date:
<TABLE>
<S> <C>
Interests relating to leasehold other than
tangible equipment and facilities (Leasehold) 70%
Interests relating to tangible equipment
and facilities (Tangibles) 30%
---
Total Allocation 100%
</TABLE>
Any adjustments to the Purchase Price under Section 2.2 shall ratably adjust the
allocation to Leasehold and Tangibles.
ARTICLE 3 - TITLE MATTERS
3.1 ACCESS TO ASSETS AND ARCO EMPLOYEES. Prior to the Closing Date,
ARCO shall grant Purchaser access during ARCO's normal business hours (by
appointment only) to the Assets (including all Records) and the employees of
ARCO. The Records shall be made available at their present location.
3.2 DEFINITION OF MARKETABLE TITLE. As used herein, the term
"Marketable Title" shall mean, in the case of the Leasehold Interests listed on
Exhibit A and other Assets to which an Allocated Value is assigned on Exhibit
3.6 (each such identified other Asset being herein referred to as a "Valued
Asset"), such right, title and interest (owned beneficially or of record) that,
except for Permitted Encumbrances:
(a) is free from reasonable doubt to the end that a prudent person
engaged in the business of purchasing and owning, developing and
operating producing oil and gas properties with knowledge of all of the
facts and their legal bearing would be willing to accept the same;
(b) entitles ARCO to receive not less than the interest set forth in
Exhibit A as the "Net Revenue Interest" or "NRI" with respect to all of
the oil, gas, and hydrocarbon minerals produced, saved and marketed
from each unit or well, as the case may be, that relates to ARCO's
producing interval in the lands and depths included within each
property identified on Exhibit A under the column entitled "Property
Name" (each such identified property being herein referred to as a
"Property");
(c) obligates ARCO to pay costs and expenses relating to the operations
on and the maintenance and development of each unit or well, as the
case may be, that relates to ARCO's
Purchase and Sale Agreement Page 6
<PAGE> 7
producing interval in the lands and depths included within each
Property, in an amount not greater than the "Working Interest" or "WI"
set forth in Exhibit A with respect to such Property; and
(d) is free and clear of any mortgages, liens, encumbrances or consent
requirements;
provided, however, that with respect to clauses (b) and (c) above ARCO's title
shall nevertheless be deemed to constitute "Marketable Title" if (i) the
difference between ARCO's actual interest and the interest set forth in Exhibit
A for each unit or well included within an individual Property is 1% or less
than the interest set forth in Exhibit A (by way of example, and without
limiting the generality of the foregoing, if the Net Revenue Interest shown in
Exhibit A for each unit or well included within a Property is 88%, ARCO will
have Marketable Title to such Leasehold Interest if it is entitled to receive
not less than 87.12% of all oil and gas produced from such Property) or (ii) the
value of any difference between ARCO's actual interest in the interest set forth
in Exhibit A (as such value is determined in accordance with Section 3.6) is
less than $10,000.00.
3.3 DEFINITION OF PERMITTED ENCUMBRANCES. As used herein, the term
"Permitted Encumbrances" shall mean:
(a) Lessors' royalties, overriding royalties, reversionary interests
and similar burdens affecting a Leasehold Interest if the net
cumulative effect of such burdens does not operate to reduce the
interest of ARCO with respect to all oil and gas produced from any
units or wells below the "Net Revenue Interest" or "NRI" set forth in
Exhibit A for the Property to which such units or wells relate;
(b) Division orders and sales contracts terminable without penalty upon
no more than 90 days notice to the purchaser;
(c) Preferential rights to purchase and required third-party consents
to assignments and similar agreements with respect to which waivers or
consents are obtained from the appropriate parties or the appropriate
time period for asserting the rights has expired without an exercise of
such rights;
(d) Materialman's, mechanic's, repairman's, employee's, contractor's,
operator's, tax, and other similar liens or charges arising in the
ordinary course of business for obligations that are not delinquent or
that will be paid and discharged in the ordinary course of business or
if delinquent, that are being contested in good faith by appropriate
action;
(e) All rights to consent by, required notices to, filings with, or
other actions by governmental or tribal entities in connection with the
sale or conveyance of oil and gas leases or interests therein;
(f) Conventional rights of reassignment requiring notice to the
holders of such rights;
(g) Easements, rights-of-way, servitudes, permits, surface leases and
other rights of third parties in respect of surface operations which
individually or in the aggregate do not materially interfere with the
operation, value or use of the Leasehold Interests (or portions
thereof) affected thereby;
(h) All other liens, charges, encumbrances, contracts, agreements,
instruments, obligations, defects and irregularities affecting the
Leasehold Interests or the units or wells to which they relate that
individually or in the aggregate:
(i) are not such as to interfere materially with the
operation, value or use of the Leasehold Interests (or
portion thereof) affected thereby,
(ii) do not unreasonably delay the receipt or materially
prevent Purchaser from receiving the proceeds of production
from any of the units or wells to which the Leasehold
Interests relate,
(iii) do not materially reduce the interest of ARCO with
respect to all oil and gas produced from any unit or well to
which the Leasehold Interests relate below the "Net Revenue
Interest" or "NRI" set forth in Exhibit A for the Property to
which such unit or well relates, and
(iv) do not materially increase ARCO's portion of the costs
and expenses relating to the operations on and the maintenance
and development of the lands and depths included in any unit
or well to which the Leasehold Interests relate above the
"Working Interest" or "WI" set forth in Exhibit A for the
Property to which such unit or well relates;
(i) All rights reserved to or vested in any municipality or
governmental, statutory or public authority to control or regulate any
of the Leasehold Interests in any manner, and all applicable laws,
rules and orders of any such authority;
Purchase and Sale Agreement Page 7
<PAGE> 8
(j) Any Title Defects Purchaser may have expressly waived in writing or
which are deemed to have been waived under Section 3.4 or any other
matters that are included in the adjustments to the Purchase Price
pursuant to Section 2.2;
(k) The terms and provisions of all operating agreements, unit
agreements, unit operating agreements, pooling agreements and pooling
designations affecting the Leasehold Interests which are specifically
listed on Exhibit A; and
(l) The terms and conditions of all leases, agreements, orders,
instruments and documents expressly described in or referred to in
Exhibit A.;
(m) The terms and conditions of all agreements with King Cad Plus for
month-to-month rental of office space and/or drafting services in-lieu
of rental of office space within the ARCO Longview Production Office
and which shall be terminated by ARCO on or before April 1, 1999;
(n) Corporate mergers between Atlantic Richfield Company, a Delaware
corporation, and predecessor corporations, including, but not limited
to, Atlantic Richfield Company, a Pennsylvania corporation, Hondo Oil &
Gas Company, a New Mexico corporation, Sinclair Oil & Gas Corporation,
a Maine corporation, Sinclair Corporation, Richfield Oil Corporation,
and Houston Oil and Gas Company, even though Certificates of Corporate
Merger or other evidence of such corporate merger or mergers are not
recorded in the applicable county records wherein the Assets involved
may be located; provided, however, that upon request, ARCO is able to
provide Purchaser with photocopies of the Certificates of Corporate
Merger filed with the Secretary of State of the state or states of
incorporation of the merging corporation.; and
(o) Production payments wherein ARCO or a predecessor corporation of
ARCO is named as obligor/payor and where the principal amount of
initial indebtedness is less than $5,000,000.00 and where the effective
date of the production payment obligation is on or before January 1,
1972 (any such production payment referred to hereafter as an
"Unreleased Production Payment"), even though a release of all
obligations of ARCO or ARCO's predecessor in interest has not been
filed in the county records wherein the Assets involved are located,
unless Purchaser can demonstrate to ARCO by the presentation of
business records, financial records or check stubs created and issued
within one year of Closing that any such production payment is still
being carried in an active status and all obligations of ARCO or ARCO's
predecessor thereunder have not been completely satisfied.
Notwithstanding anything to the contrary contained herein, ARCO does
hereby agree to indemnify and hold harmless Purchaser and its
affiliated parties from and against any and all claims, liabilities,
losses, costs and expenses (including court costs and reasonable
attorneys' fees) in related to or arising from an Unreleased Production
Payment, for as long as Purchaser or its affiliated parties own the
Assets affected by the Unreleased Production Payment. ARCO's obligation
to indemnify Purchaser under this Section 3.3(o) is unique and
personal, and as such is non-assignable and non-transferable. Further,
ARCO's indemnity to Purchaser under this Section 3.3(o) shall be
limited to the lesser of the Allocated Value for the affected Asset as
shown on Exhibit 3.6 attached hereto, or the mutually agreed upon fair
market value of the Asset at the time the Unreleased Production Payment
is brought to ARCO's attention by Purchaser or its affiliated party,
but in either case ARCO's indemnity shall apply only to values in
excess of $5,000.00.
3.4 NOTICE OF TITLE DEFECT. Purchaser shall notify ARCO in writing, as
soon as reasonably practicable after Purchaser has knowledge thereof, and in any
event on or before five (5) days prior to the Closing Date (the "Notification
Deadline"), of any matter ("Title Defect") that would cause ARCO's title to any
of the Properties or Valued Assets not to be Marketable Title, in each case
together with a detailed explanation of (a) the nature of such Title Defect, (b)
the Leasehold Interests or Valued Assets (or portions thereof) affected thereby
and (c) Purchaser's proposed Defect Value (as hereinafter defined) for such
Title Defect in a form similar to Exhibit 3.4. Any matters that would otherwise
constitute Title Defects but which are not specifically raised in writing (with
the detailed explanation as contemplated in the immediately preceding sentence)
by Purchaser prior to the Notification Deadline shall conclusively be deemed
waived by Purchaser. As used herein, the term "Defect Value" shall mean with
respect to each Title Defect, the reduction in the "Allocated Value" of the
affected Leasehold Interest or other Valued Asset as a result of such Title
Defect, as determined pursuant to Sections 3.6 and 3.7.
3.5 REMEDIES FOR TITLE DEFECTS.
(a) ARCO shall have the right, but not the obligation, to attempt to
cure any Title Defect with respect to which it has received notice from
Purchaser prior to the Notification Deadline.
(b) With respect to any Title Defect for which ARCO receives the
required notice from Purchaser on or before the Notification Deadline,
ARCO and Purchaser shall attempt to agree, subject to the terms of the
last sentence of this Section 3.5(b), upon a mutually acceptable remedy
from among the following options:
(i) For ARCO to indemnify Purchaser against all liability,
loss, cost and expense resulting from such Title Defect, in
which event the Purchase Price shall not be reduced and the
Leasehold Interest or other Valued Asset subject to such Title
Defect shall be sold to Purchaser hereunder (it being
understood and agreed, however, that in no event shall ARCO's
liability under any such indemnity exceed the Defect Value of
the Title
Purchase and Sale Agreement Page 8
<PAGE> 9
Defect to which such indemnity relates or survive beyond the
period provided in Section 17.13);
(ii) To exclude the Leasehold Interest or other Valued Asset
subject to the Title Defect from the sale hereunder, in which
event the Purchase Price shall be reduced by the Allocated
Value (as defined in Section 3.6) of such Leasehold Interest
or other Valued Asset; or
(iii) The Leasehold Interest or other Valued Asset subject to
such Title Defect shall be sold to Purchaser hereunder and the
Purchase Price shall be reduced by the Defect Value for such
Title Defect.
In the event ARCO and Purchaser are unable to agree upon one of the
foregoing options on or before the Closing Date then, unless the Title
Defect is waived in writing by Purchaser, either party shall have the
right to submit the disputed item(s) for binding arbitration in
accordance with Article 3.11. The Asset(s) subject to title defect
resolution dispute shall be sold to Purchaser at Closing and no
Purchase Price adjustment, indemnification by ARCO or reassignment to
ARCO shall be made until warranted by agreement of the Parties or
arbitration. THERE SHALL BE NO REDUCTION IN THE PURCHASE PRICE FOR
TITLE DEFECTS PURSUANT TO THE TERMS OF THIS SECTION 3.5(b), AND ARCO
SHALL NOT BE LIABLE FOR ANY INDEMNITY GRANTED PURSUANT TO THIS SECTION
3.5(b), UNLESS AND UNTIL, AND ONLY TO THE EXTENT THAT, THE AGGREGATE OF
ALL SUCH AMOUNTS EXCEEDS $50,000.00
(c) To the extent that same are discovered by either party prior to the
Notification Deadline, ARCO and Purchaser acknowledge and agree that
the Purchase Price shall be increased (a "Title Increase") by an amount
equal to the value allocated to the following:
(i) any increase in ARCO's Net Revenue Interest shown on
Exhibit A for a Property without a corresponding increase (in
each case to the extent greater than 1% of the interest shown
on Exhibit A) in ARCO's Working Interest above that shown on
Exhibit A for such Property; or
(ii) any decrease in ARCO's Working Interest below that shown
on Exhibit A for any Property without a corresponding decrease
(in each case to the extent greater than 1% of the interest
shown on Exhibit A) in the Net Revenue Interest shown on
Exhibit A for such Property,
in each case with such values to be agreed upon by ARCO and
Purchaser (taking into account the Allocated Value for such
Property) or otherwise determined pursuant to the procedures
set forth in Section 3.7. THERE SHALL BE NO INCREASE IN THE
PURCHASE PRICE FOR TITLE INCREASES PURSUANT TO THE TERMS OF
THIS SECTION 3.5 UNLESS AND UNTIL, AND ONLY TO THE EXTENT
THAT, THE AGGREGATE OF ALL SUCH AMOUNTS EXCEEDS $50,000.00.
(d) Notwithstanding anything to the contrary contained in this
Agreement,
(i) the existence of a Title Defect shall not result in
Purchaser having any right to exclude any Leasehold Interest
from the sale hereunder or to fail to perform its obligations
at Closing, and
(ii) there shall be no adjustment to the Purchase Price as a
result of ARCO's title to any of the Assets other than the
Leasehold Interests and other Valued Assets.
3.6 VALUE OF LEASEHOLD INTEREST OR TITLE DEFECT. As used herein, the
term "Allocated Value" shall mean, with respect to any Valued Asset, Property,
or any unit or well relating thereto, the amount set forth under the column
entitled "Allocated Value" for such Property, unit or well on Exhibit 3.6 (which
Exhibit 3.6 includes an Allocated Value for and list of all Leasehold Interests
that have been identified prior to the date hereof as being subject to a
preferential purchase right) or if no separate amount is set forth in Exhibit
3.6, the amount agreed upon by ARCO and Purchaser as the value of such Leasehold
Interest, unit or well. If ARCO does not agree with Purchaser's proposed Defect
Value or the parties are unable to agree upon whether a Title Defect exists, the
Allocated Value of a Leasehold Interest or the value allocated to a Title
Increase, in each case for purposes of Section 3.5, then the parties shall enter
into good faith negotiations and shall attempt to agree on such matter, and any
values to be agreed upon shall be based on the Allocated Value for the group of
properties with which such Leasehold Interest, unit or well appears on Exhibit
3.6.
3.7 DETERMINATION OF VALUES BY CONSULTANT. Subject to ARCO's right to
elect to indemnify Purchaser pursuant to Section 3.5(b)(i), if ARCO and
Purchaser cannot reach agreement on the existence of a Title Defect, the
Allocated Value of a Leasehold Interest, the Defect Value for a Title Defect or
the value allocated to any Title Increases, in any such case within 10 days
after the commencement of good faith negotiations pursuant to Section 3.6, at
either party's option, upon notice to the other party, such Allocated Value,
Defect Value or amount allocated to a Title Increase, as applicable, shall be
determined by an independent petroleum reservoir consultant chosen by lot from
among the following firms: DeGolyer & MacNaughton, Keplinger and Associates,
Inc. and Gruy and Associates, Inc. Such consulting firm shall have the right to
hire such additional neutral consultants and experts as it deems reasonably
appropriate. The consultant chosen for the first applicable valuation hereunder
shall serve for all
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valuations hereunder; provided, however, that if at any time any consultant so
chosen fails or refuses to perform hereunder, a new consultant shall be chosen
in a similar manner from among the remaining firms. The cost of any consultant
shall be borne one-half by ARCO and one-half by Purchaser. Each party shall
present its position on the value in question to the consultant within five days
after the consultant is requested to determine the value, and the consultant
shall make a determination of the value involved as soon as practicable
thereafter. The determination by the consultant shall be conclusive and binding
on the parties, and shall be enforceable against any party in any court of
competent jurisdiction.
3.8 NOTICES TO HOLDERS OF PREFERENTIAL PURCHASE RIGHTS. With respect to
each party shown in ARCO's records as holding a preferential purchase right
covering the Leasehold Interests (a preliminary list of such affected Leasehold
Interests is set forth in Exhibit 3.6), ARCO shall send to the holder of such
right a notice offering to sell to such holder, in accordance with the
contractual provisions applicable to such right, those Leasehold Interests
covered by such right on the terms hereof and for the same Allocated Value of
such Leasehold Interests (as set forth on Exhibit 3.6), subject to adjustments
in price in the same manner that the Purchase Price is adjusted pursuant to
Article 2 of this Agreement.
3.9 EXERCISE OF PREFERENTIAL PURCHASE RIGHTS. If, prior to Closing, any
holder of a preferential purchase right notifies ARCO that it intends to
consummate the purchase of the Leasehold Interests to which its preferential
purchase right applies, then those Leasehold Interests shall be excluded from
the Assets to be conveyed to Purchaser under this Agreement, and the Purchase
Price shall be reduced by the Allocated Value of such Leasehold Interests;
provided, however, that if the holder of such preferential right fails to
consummate the purchase of the Leasehold Interests covered by such right, then
within 90 days following the Closing Date, ARCO may so notify Purchaser, and
within 15 days after Purchaser's receipt of such notice from ARCO, ARCO shall
sell to Purchaser, and Purchaser shall purchase from ARCO, for a price equal to
the Allocated Value of such Leasehold Interests (as adjusted pursuant to the
provisions of Section 2.2 above) and upon the other terms of this Agreement (to
the extent applicable), the Leasehold Interests to which the preferential
purchase right applied. All Leasehold Interests, other than those for which ARCO
has received notice of the exercise of a preferential purchase right, subject to
the other provisions of the Agreement, shall be sold to Purchaser at the Closing
pursuant to the provisions of this Agreement.
3.10 RISK OF LOSS. Subject to the provisions of Section 9.7, no
adjustment to the Purchase Price shall be made if, after the date hereof and
prior to the Closing any part of the Assets shall be destroyed or harmed by fire
or any other cause or shall be taken by condemnation or the exercise of eminent
domain, but Purchaser shall be entitled to any applicable insurance proceeds (to
the extent actually received by ARCO and not payable from a captive insurance
carrier or subject to reimbursement or repayment by ARCO or its affiliates) or
condemnation awards.
3.11 ARBITRATION PROCEDURE. If any matter is required by this Article 3
to be arbitrated, such arbitration shall be conducted as set forth in this
Section 3.11.
(a) The parties shall jointly select a mutually acceptable person as
the sole arbitrator under this Agreement. If the parties are unable to
agree upon the designation of a person as arbitrator, then either ARCO
or Purchaser, or all of such parties, may in writing request the
American Arbitration Association ("AAA") to appoint a qualified
arbitrator.
(b) Any arbitration hearing shall be held at a place in Houston, Texas
acceptable to the arbitrator.
(c) The arbitrator shall settle disputes regarding existence and value
of Title Defects and ARCO's attempts to correct any Title Defects in
accordance with the Texas General Arbitration Act (Chapter 171, Texas
Civil Practice and Remedies Code) and the Commercial Arbitration Rules
of the AAA, to the extent such rules do not conflict with the terms of
such act and the terms hereof. Such arbitrator shall hear all
arbitration matters arising under this Article 3. The decision of the
arbitrator shall be binding upon the parties, and may be enforced in
any court of competent jurisdiction. ARCO and Purchaser, respectively,
shall bear their own legal fees and other costs incurred in presenting
their respective cases. The charges and expenses of the arbitrator
shall be shared equally by ARCO and Purchaser.
(d) The arbitration shall commence within thirty (30) days after the
arbitrator is selected as set forth in Section 3.11(a) above. In
fulfilling his or her duties hereunder, the arbitrator shall be bound
by the terms of this Agreement, may consider such other matters as in
the opinion of the arbitrator are necessary or helpful to make a proper
evaluation and may consult with and engage disinterested third parties,
including, without limitation, petroleum engineers, attorneys and
consultants, to advise the arbitrator.
(e) If any arbitrator selected hereunder (whether selected by ARCO and
Purchaser, or by the AAA) should die, resign or be unable to perform
his duties hereunder, the parties or the AAA who selected such
arbitrator, as the case may be, shall select a replacement arbitrator.
The aforesaid procedure shall be followed from time to time as
necessary.
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES OF ARCO
ARCO represents and warrants to Purchaser that:
4.1 EXISTENCE. ARCO is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and is duly
qualified to carry on its business in the states where the Assets are located.
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4.2 POWER. ARCO has the corporate power and authority to enter into and
perform this Agreement and the transactions contemplated hereby. Subject to
preferential purchase rights and restrictions on assignment of the type
generally found in the oil and gas industry (which shall include any matter that
would constitute a Title Defect under Article 3 hereof), and to rights to
consent by, required notices to, and filings with or other actions by
governmental or tribal entities, the execution, delivery and performance of this
Agreement by ARCO, and the transactions contemplated hereby, will not violate
(a) any provision of the certificate of incorporation or bylaws of ARCO, (b) any
material agreement or instrument to which ARCO is a party or by which ARCO or
any of the Leasehold Interests are bound, (c) any judgment, order, ruling, or
decree applicable to ARCO as a party in interest, or (d) any law, rule or
regulation applicable to ARCO.
4.3 AUTHORIZATION. The execution, delivery and performance of this
Agreement and the transactions contemplated hereby have been duly and validly
authorized by all requisite corporate action on the part of ARCO. This Agreement
has been duly executed and delivered on behalf of ARCO, and at Closing all
documents and instruments required hereunder to be executed and delivered by
ARCO shall have been duly executed and delivered. This Agreement does, and such
documents and instruments shall, constitute legal, valid and binding obligations
of ARCO enforceable in accordance with their terms, subject, however, to the
effect of bankruptcy, insolvency, reorganization, moratorium and similar laws
from time to time in effect relating to the rights and remedies of creditors, as
well as to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
4.4 BROKERS. ARCO has incurred no obligation or liability, contingent
or otherwise, for brokers' or finders' fees in respect of the matters provided
for in this Agreement that will be the responsibility of Purchaser; and any such
obligation or liability that might exist shall be the sole obligation of ARCO.
4.5 FOREIGN PERSON. ARCO is not a "foreign person" within the meaning
of the Internal Revenue Code of 1986, as amended, (hereinafter called the
"Code"), Section 1445 and 7701 (i.e. ARCO is not a nonresident alien, foreign
corporation, foreign partnership, foreign trust or foreign estate as those terms
are defined in the Code and any regulations promulgated thereunder).
4.6 DEFAULTS. To the best of ARCO's knowledge, ARCO is not in default
under and no condition exists that with notice or lapse of time or both would
constitute a default under (i) any mortgage, indenture, loan, credit agreement
or other agreement or instrument evidencing indebtedness for borrowed money to
which any of the Assets are subject, or any other agreement, contract lease,
license or other instrument, (ii) any order, judgment or decree of any court,
commission, board, agency or other governmental body, or (iii) any law, statute,
ordinance, decree, order, rule or regulation of any governmental authority.
4.7 CHANGES IN LAST YEAR. To the best of ARCO's knowledge and except as
provided for or disclosed in Exhibit "4.7" hereto, during the one (1) year
period immediately prior to the date of this Agreement, there has not been:
(a) Any material damage, destruction or loss to or of the Assets to be
sold to Purchaser, whether or not covered by insurance;
(b) Any sale, lease or other disposition of the Assets by ARCO, except
as permitted by the terms of this Agreement;
(c) Any mortgage, pledge or grant of a lien or security interest in
any of the Assets by ARCO, except any such encumbrance that will be
released at or before the Closing; or
(d) Any contract or commitment by ARCO to do any of the foregoing.
4.8 MATERIAL AGREEMENTS. To the best of ARCO's knowledge, (I) Exhibit
"A" hereto sets forth a listing of all material contracts, agreements, plans,
commitments and other burdens and documents affecting the Assets (the "Material
Agreements"), (ii) all of such Material Agreements are in full force and effect
and are the valid and legally binding obligations of the parties thereto, (iii)
ARCO is not in breach or default with respect to any material obligations
pursuant to any Material Agreement; (iv) no other party to any Material
Agreement (or any successor in interest thereto) is in breach or default with
respect to any of its material obligations thereunder; (v) ARCO has not given
nor received notice of any action to terminate, cancel, rescind or procure a
judicial reformation of any Material Agreement; and (vi) the listing of the
Material Agreements on Exhibit "A" includes, without limitation, the following:
(a) Any contract, commitment or agreement that involves aggregate
expenditures by ARCO with respect to the Assets of more than
$10,000.00 per year;
(b) Any indenture, trust agreement, loan agreement or note under which
ARCO has outstanding indebtedness, obligations or liabilities for
borrowed money and which is secured by a lien, security interest or
other encumbrance on the Assets;
(c) Any lease, sublease, installment purchase or similar arrangement
for the use or occupancy of real property that involves aggregate
expenditures by ARCO of more than $10,000.00 per year, together with a
list of the location of such leased property, the date
Purchase and Sale Agreement Page 11
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of termination of such arrangements, the name of the other party and
the annual rental payments required to be made for such arrangements;
(d) Any guaranty, direct or indirect, by any affiliate of ARCO of any
contract, lease or agreement entered into by ARCO with respect to the
ownership or operation of the Assets;
(e) Any agreement of surety, guarantee or indemnification by ARCO with
respect to the ownership or operation of the Assets;
(f) All contacts for the sale and purchase of hydrocarbons produced
from the Assets and agreements for the transportation of hydrocarbons
affecting the Assets; and
(g) All farmout, farmin, dry hole, bottom hole, acreage contribution,
purchase and acquisition agreements, area of mutual interest
agreements, salt water disposal agreements, processing agreements,
plant/facilities agreements, servicing contracts, easement and/or
right-of-way agreements, operating agreements, unitization or pooling
agreements and all other executory contracts and agreements relating
to the Assets.
4.9 DEFECTS. To the best of ARCO's knowledge and except as provided for
or disclosed in Exhibit 4.9, there are no material defects in the Assets to be
conveyed to Purchaser pursuant to the terms hereof which would prevent the
continued operation of the Assets in accordance with prior practice.
4.10 TAXES. To the best of ARCO's knowledge, all ad valorem, property,
production, severance and similar taxes and assessments based on or measured by
the ownership of property or the production of hydrocarbons or the receipt of
proceeds therefrom with respect to the Assets which are currently due have been
properly and timely paid.
4.11 COMPLIANCE WITH LAWS. To the best of ARCO's knowledge, all
material valid laws, regulations and orders of all governmental agencies having
jurisdiction over the Assets have been and shall continue to be complied with
until the Closing, all material necessary permits from and reports to
governmental agencies having jurisdiction in connection with the Assets have
been obtained and have been timely, properly and accurately made and will
continue to be timely, properly and accurately made through Closing, and all
plugged wells located on the Assets have been properly plugged.
4.12 OPTIONS AND CALLS. To the best of ARCO's knowledge, except as
specifically disclosed on Exhibit "A" hereto, none of the Assets is subject to
any options, calls or preferential rights to purchase production or similar
rights that would adversely and materially affect the value of the Assets or the
price Purchaser is able to obtain form the sale of production from the Assets
after the Effective Date.
4.13 LITIGATION. To the best of ARCO's knowledge and except as may be
set forth in Exhibit 9.6 hereto, on the date hereof no suit, action or other
proceeding is pending before any court or governmental agency to which ARCO is a
party and which might result in impairment or loss of ARCO's title to any part
of the Assets or that might hinder or impede operation of the Assets and, to the
knowledge of ARCO, no such suit, action or other proceeding is threatened. ARCO
shall promptly notify Purchaser of any such proceeding which comes to ARCO's
attention after the date of this Agreement.
4.14 LEASE MAINTENANCE. To the best of ARCO's knowledge (1) all
material royalties (other than royalties in suspense), rentals and other
payments due under the Leasehold Interests have been properly and timely paid,
(ii) all conditions necessary to keep such Leasehold Interests in force have
been fully performed, (iii) no notices have been received by ARCO of any claim
to the contrary, and (iv) all of such Leasehold Interests are in full force and
effect.
4.15 GAS PRODUCTION AND IMBALANCES. To the best of ARCO's knowledge and
except as disclosed in Exhibit 2.2, ARCO has not produced a share of gas with
respect to the Assets greater than its ownership percentage and ARCO is under no
obligation to reduce its share of production under any gas balancing agreement
or similar arrangement to allow under-produced parties to come back into
balance. Except as disclosed in Exhibit 2.2, ARCO is receiving on a current
basis the payments required under the terms of any gas contracts applicable to
the Assets, and no purchaser of natural gas under any gas contracts has (i)
materially curtailed (other than seasonal curtailment) its takes of natural gas,
or (ii) given notice (either written or verbal) that it desires to amend any gas
contracts with respect to price of quantity of deliveries to such an extent that
any such action would materially affect the economic value of the reserves
attributable to the Assets affected by such action.
4.16 PENDING AND PROPOSED OPERATIONS AND CAPITAL PROJECTS. Exhibit 4.16
is a list and description of all wells currently being drilled, reworked,
recompleted or on which other operations are being conducted or have been
formally proposed and the associated costs or estimates thereof, and of all
other capital projects, proposed or pending with respect to the Assets and the
associated costs or estimates thereof, and all other authorities for expenditure
received or given by ARCO with respect to the Assets for which the work therein
described was not fully completed prior to the Effective Date, regardless of
whether ARCO has approved, disapproved or not yet responded to any such
authority for expenditure, to the extent, in each case, that such costs,
estimates or authorities for expenditure exceed $50,000.00 per well or project,
net to ARCO's interest.
Purchase and Sale Agreement Page 12
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ARTICLE 5 - REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to ARCO that:
5.1 EXISTENCE. Purchaser is a limited partnership duly organized,
validly existing, and in good standing under the laws of the State of Texas, and
is duly qualified to carry on its business in the states where the Assets are
located.
5.2 POWER. Purchaser has the partnership power and authority to enter
into and perform this Agreement and the transactions contemplated hereby.
Subject to rights to consent by, required notices to, and filings with or other
actions by governmental entities, the execution, delivery and performance of
this Agreement by Purchaser, and the transactions contemplated hereby, will not
violate (a) any provision of the partnership agreement or bylaws of Purchaser,
(b) any material agreement or instrument to which Purchaser is a party or by
which Purchaser is bound, (c) any judgment, order, ruling, or decree applicable
to Purchaser as a party in interest, or (d) any law, rule or regulation
applicable to Purchaser.
5.3 AUTHORIZATION. The execution, delivery and performance of this
Agreement and the transactions contemplated hereby have been duly and validly
authorized by all requisite partnership action on the part of Purchaser. This
Agreement has been duly executed and delivered on behalf of Purchaser, and at
Closing all documents and instruments required hereunder to be executed and
delivered by Purchaser shall have been duly executed and delivered. This
Agreement does, and such documents and instruments shall, constitute legal,
valid and binding obligations of Purchaser enforceable in accordance with their
terms, subject, however, to the effect of bankruptcy, insolvency,
reorganization, moratorium and similar laws from time to time in effect relating
to the rights and remedies of creditors, as well as to general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).
5.4 BROKERS. Purchaser has incurred no obligation or liability,
contingent or otherwise, for brokers' or finders' fees in respect of the matters
provided for in this Agreement which will be the responsibility of ARCO; and any
such obligation or liability that might exist shall be the sole obligation of
Purchaser.
5.5 FURTHER DISTRIBUTION. Purchaser is not acquiring the Leasehold
Interests with a view to, or for offer of resale in connection with, a
non-exempt distribution thereof within the meaning of the Securities Act of
1933, as amended, and the rules and regulations pertaining to it or a
distribution thereof in violation of any applicable Securities laws. Purchaser
covenants that if in the future it should decide to dispose of any of its
interest in the Assets, subject to any restriction on assignment set forth
herein or in the Assignment and Bill of Sale delivered by ARCO to Purchaser at
Closing, Purchaser will do so only in compliance with any applicable Federal and
State Securities laws.
ARTICLE 6 - PRE-CLOSING OBLIGATIONS OF ARCO
6.1 OPERATIONS. From the date of this Agreement until Closing (the
"Interim Period"), except as otherwise approved by Purchaser (which approval
shall not be unreasonably withheld), ARCO (a) shall permit Purchaser to have
access to those Assets operated by ARCO and shall use reasonable efforts to
provide Purchaser access to those Assets not operated by ARCO, (b) shall operate
the Assets for which it is the operator in a good and workmanlike manner and in
accordance with past practices, (c) shall not transfer, sell, hypothecate,
encumber or otherwise dispose of any of the Assets (other than in the ordinary
course of business or as required in connection with the exercise by third
parties of preferential rights to purchase any of the Assets, or as required in
the administration of existing agreements pertaining to any of the Assets), (d)
shall maintain all insurance coverages now in force with respect to the Assets,
(e) shall pay or cause to be paid prior to delinquency all costs and expenses in
connection with the ownership and operation of the Assets, (f) shall keep the
Material Agreements in full force and effect and will perform and comply with
all the convenants and conditions contained therein, (g) shall not enter into
any material new agreements or commitments with respect to the Assets, and (h)
shall not modify, terminate or settle any dispute arising out of any of the
Material Agreements relating to the Assets. In the absence of Purchaser's prior
written consent (which consent shall not be unreasonably withheld), ARCO shall
not conduct or authorize any work, repair, capital investment or operation with
respect to the Assets requiring an expenditure of $50,000 or more for any single
project (except emergency operations).
6.2 PERMISSIONS. During the Interim Period ARCO will use reasonable
efforts to obtain all permissions, approvals, and consents of federal, state and
local governmental authorities and others as may be required to consummate the
sale contemplated hereunder (excluding governmental permissions, approvals and
consents which are customarily obtained after the consummation of transactions
of the type contemplated hereunder).
ARTICLE 7 - PRE-CLOSING OBLIGATIONS OF PURCHASER
7.1 CONFIDENTIALITY. Purchaser shall cause (a) any information relating
to the terms of the transactions contemplated hereunder, (b) the information and
data furnished or made available by ARCO to Purchaser and its officers,
employees, and representatives in connection with this Agreement or Purchaser's
investigation of the Assets and (c) any information relating to Title Defects
for which ARCO has agreed to indemnify Purchaser pursuant to Section 3.5, in
each case to be maintained in confidence
Purchase and Sale Agreement Page 13
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and not to be used for any purpose other than in connection with this Agreement
or Purchaser's investigation of the Assets; provided, however, that solely with
respect to information of the type described in clauses (a) and (b) preceding,
the foregoing obligation shall terminate on the earlier to occur of (i) the
Closing, (ii) such time as the information or data in question is disclosed to
Purchaser by a third party that is not obligated to ARCO to maintain same in
confidence, or (iii) such time as the information or data in question becomes
generally available to the oil and gas industry other than through the breach of
the foregoing obligation. The obligations of Purchaser under this Section 7.2
shall be in addition to, and not in lieu of, Purchaser's obligations under any
confidentiality agreements previously executed by ARCO and Purchaser that relate
to the Assets (the "Prior Confidentiality Agreements"). Notwithstanding anything
to the contrary contained in the Prior Confidentiality Agreements, Purchaser
acknowledges and agrees that the terms and provisions of the Prior
Confidentiality Agreements shall not be superseded by the provisions of this
Agreement, but shall continue in full force and effect from and after the
Closing Date.
7.2 RETURN OF DATA. Purchaser agrees that if this Agreement is
terminated for any reason whatsoever, Purchaser shall, at ARCO's request,
promptly return to ARCO all information and data furnished by or on behalf of
ARCO to Purchaser, its officers, employees, and representatives in connection
with this Agreement or Purchaser's investigation of the Assets, and Purchaser
shall deliver to ARCO or destroy all copies, extracts or excerpts of such
information and data and all documents generated by Purchaser that contain any
portion of such information or data.
7.3 INDEMNITY REGARDING ACCESS. Purchaser agrees to protect, indemnify,
defend and hold harmless ARCO, its directors, officers, employees, agents and
representatives (collectively, the "ARCO Indemnified Parties") from and against
any and all claims, liabilities, losses, costs and expenses (including, without
limitation, court costs and reasonable attorneys' fees) in connection with
personal injuries, including death, or property damage arising out of or
relating to the access of Purchaser, its officers, employees, and
representatives to the Assets and any information relating thereto as permitted
under this Agreement, REGARDLESS OF WHETHER SUCH INJURIES, DEATH OR DAMAGES ARE
CAUSED IN WHOLE OR PART BY THE SOLE, PARTIAL, CONCURRENT OR OTHER NEGLIGENCE,
GROSS NEGLIGENCE, STRICT LIABILITY, WILLFUL MISCONDUCT OR OTHER FAULT OF THE
ARCO INDEMNIFIED PARTIES. IT IS THE EXPRESSED INTENTION OF THE PARTIES HERETO
THAT THE INDEMNITY PROVIDED FOR BY THIS SECTION 7.3 CONSTITUTES AN AGREEMENT BY
PURCHASER TO INDEMNIFY AND PROTECT THE ARCO INDEMNIFIED PARTIES FROM THE
CONSEQUENCES OF THEIR OWN NEGLIGENCE, GROSS NEGLIGENCE, STRICT LIABILITY,
WILLFUL MISCONDUCT OR OTHER FAULT, REGARDLESS OF WHETHER SAME IS THE SOLE OR A
CONCURRING CAUSE OF THE INJURY, DEATH OR DAMAGE. PURCHASER FURTHER AGREES THAT
ACCESS TO CERTAIN OF THE ASSETS SHALL BE CONDITIONED UPON PURCHASER, ITS AGENTS,
EMPLOYEES, REPRESENTATIVES OR CONTRACTORS EXECUTING APPROPRIATE REQUEST FOR
ACCESS FORMS AS MAY BE REQUIRED BY ARCO.
ARTICLE 8 - ARCO'S CONDITIONS OF CLOSING
ARCO's obligation to consummate the transactions provided for herein is
subject to the satisfaction or waiver on or before the Closing Date of the
following conditions:
8.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of Purchaser contained in Article 5 shall be true and correct in all material
respects on the date of Closing as though made on and as of that date.
8.2 PERFORMANCE. Purchaser shall have performed in all material
respects the obligations, covenants and agreements required hereunder to be
performed by it at or prior to the Closing.
8.3 OFFICERS CERTIFICATE. Purchaser shall have delivered to ARCO a
certificate of a corporate officer, dated the date of Closing, certifying on
behalf of Purchaser that the conditions set forth in Sections 8.1 and 8.2 have
been fulfilled.
8.4 PENDING MATTERS. No suit, action or other proceeding by a third
party or a governmental authority shall be pending or threatened which seeks
substantial damages from ARCO in connection with, or seeks to restrain, enjoin
or otherwise prohibit, the consummation of the transactions contemplated by this
Agreement.
8.5 OPINION OF PURCHASERS COUNSEL. Purchaser shall have delivered to
ARCO an opinion of Purchasers counsel reasonably acceptable to ARCO, dated as of
the Closing, in form and substance reasonably satisfactory to ARCO, to the
effect that:
(a) Purchaser is a limited partnership duly organized, validly existing
and in good standing under the laws of the State of Texas and is duly
qualified to carry on its business in the state(s) where the Assets are
located;
(b) The execution, delivery and performance of this Agreement and the
transactions contemplated hereby have been duly and validly authorized
by all requisite corporate action on the part of Purchaser; and
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(c) This Agreement and all documents and instruments executed by
Purchaser at Closing have been duly executed and delivered on behalf of
Purchaser and constitute legal, valid and binding obligations of
Purchaser enforceable in accordance with their terms.
In giving such opinion, Purchaser's counsel may rely upon certificates of
governmental officials and of Purchaser's officers as to matters of fact, and
may qualify such opinion with such other assumptions and exceptions as are
reasonable under the circumstances.
8.6 OPERATORSHIP FORMS. Purchaser shall have executed and delivered to
ARCO such forms as may be required by any governmental authority having
jurisdiction to evidence the change of operatorship from ARCO to Purchaser on
all wells constituting a part of the Assets that are operated by ARCO.
8.7 BONDS. Purchaser shall have delivered to ARCO either: (a) copies of
any bonds, in form and substance and issued by a corporate surety satisfactory
to ARCO, covering any ARCO operated Leasehold Interests required under any laws,
rules or regulations of any federal, Indian, state or local governmental
agencies having jurisdiction over the Assets; or (b) a commitment by a surety
company, satisfactory to ARCO, to issue such bonds upon Closing.
ARTICLE 9 - PURCHASER'S CONDITIONS OF CLOSING
Purchaser's obligation to consummate the transactions provided for
herein is subject to the satisfaction or waiver on or before the Closing Date of
the conditions set forth in this Article 9. Purchaser acknowledges and agrees
that notwithstanding anything contained in this Agreement to the contrary, in no
event shall Purchaser's obligation to consummate the transactions provided for
herein be subject to the condition that Purchaser receive financing with respect
to all or any part of the Purchase Price.
9.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of ARCO contained in Article 4 shall be true and correct in all material
respects on the date of Closing as though made on and as of that date.
9.2 PERFORMANCE. ARCO shall have performed in all material respects the
obligations, covenants and agreements required hereunder to be performed by it
at or prior to the Closing.
9.3 ATTORNEY-IN-FACT CERTIFICATE. ARCO shall have delivered to
Purchaser a certificate of a corporate attorney-in-fact, dated the date of
Closing, certifying on behalf of ARCO that the conditions set forth in Sections
9.1 and 9.2 have been fulfilled.
9.4 PENDING MATTERS. No suit, action or other proceeding by a third
party or a governmental authority shall be pending or threatened which seeks
substantial damages from Purchaser in connection with, or seeks to restrain,
enjoin or otherwise prohibit, the consummation of the transactions contemplated
by this Agreement.
9.5 OPINION OF ARCO'S COUNSEL.; ARCO shall have delivered to Purchaser
an opinion of ARCO's counsel reasonably satisfactory to Purchaser, dated as of
the Closing, in form and substance satisfactory to Purchaser, to the effect
that:
(a) ARCO is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and is duly qualified
to carry on its business in the state(s) where the Assets are located;
(b) The execution, delivery and performance of this Agreement and the
transactions contemplated hereby have been duly and validly authorized
by all requisite corporate action on the part of ARCO; and
(c) This Agreement and all documents and instruments executed by ARCO
at Closing have been duly executed and delivered on behalf of ARCO and
constitute legal, valid and binding obligations of ARCO enforceable in
accordance with their terms.
In giving such opinion, ARCO's counsel may rely upon certificates of
governmental officials and of ARCO's officers as to matters of fact, and may
qualify such opinion with such other assumptions and exceptions as are
reasonable under the circumstances.
9.6 LITIGATION. Except as described in Exhibit 9.6, there shall be no
legal or arbitration proceeding against ARCO or directly involving the Assets,
in either case with respect to which ARCO has received service of process or
other written notice, that reasonably is expected to materially and adversely
affect the value of the Assets taken as a whole after the Effective Date.
9.7 MATERIAL ADVERSE CHANGE. There has been no material adverse change
in the condition of the Assets, except depreciation of personal property and
equipment through ordinary wear and tear. For purposes of this Section 9.7, a
"material adverse change" is any one or more acts, omissions, occurrences or
conditions which, in the aggregate, could reasonably be expected to impair or
diminish the value of the Assets or require Purchaser to make expenditures of
funds in repair and replacement of any portion of the Assets in the amount of
$500,000 or more.
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9.8 ACCURACY OF INFORMATION. The factual and historical data and
information with respect to the Assets made available to Purchaser by ARCO and
its representatives upon which Purchaser based its offer to purchase the Assets
was substantially accurate and complete, and Purchaser has not discovered any
fact or circumstance in its due diligence review of the Assets (excluding Title
Defects and environmental Conditions which are governed by Article 3 and Article
16, respectively, hereof) which, in the aggregate, could reasonably be expected
to impair or diminish the value of the Assets or require Purchaser to make
expenditures of funds in repair and replacement of any portion of the Assets in
the amount of $500,000 or more.
ARTICLE 10 - CLOSING
10.1 TIME AND PLACE OF CLOSING. Subject to the conditions stated in
this Agreement, the consummation of the transactions contemplated hereby (the
"Closing") shall occur on or before August 31, 1999; provided, however, that if
all of the conditions to Closing set forth in Articles 8 and 9 have not been
satisfied or waived by such date or any extended date for Closing, the party
whose obligations are subject to the conditions that have not been satisfied or
waived shall have the right to extend the date of Closing for successive periods
of up to seven days each until such conditions shall have been satisfied or
waived. The date Closing actually occurs is herein called the "Closing Date."
The Closing shall be held at ARCO's offices located at 600 North Marienfeld,
Midland, Texas, or at such other location as may be mutually agreed upon by ARCO
and Purchaser.
10.2 CLOSING OBLIGATIONS. At the Closing, the following events shall
occur:
(a) ARCO shall execute, acknowledge and deliver to Purchaser the
Conveyance, Assignment and Bill of Sale in the form of Exhibit 10.2(a)
conveying the Assets to Purchaser;
(b) ARCO shall provide executed change of operatorship forms to
Purchaser and Purchaser shall execute same;
(c) ARCO and Purchaser shall execute, acknowledge and deliver transfer
orders or letters in lieu thereof directing all parties paying for
production to make payment to Purchaser of proceeds attributable to
production after the Closing Date from the Leasehold Interests;
(d) ARCO and Purchaser shall each execute and deliver to the other a
Property Transfer Accounting Agreement in the form of Exhibit 10.2(d);
(e) If applicable and as provided in Section 13.2, Purchaser shall
provide ARCO with properly executed exemption certificates or other
documentation evidencing that the transfer of the Assets to Purchaser
is exempt from applicable sales or similar taxes;
(f) ARCO shall, as soon as is reasonably possible after the Closing,
deliver to Purchaser, at ARCO's offices, the Records (it being
understood and agreed that ARCO may retain a set of the Records and
shall grant access to the Records to Purchaser on the same basis as
provided in Section 3.1 until same are delivered to Purchaser);
(g) Purchaser shall provide satisfactory evidence to ARCO of compliance
with Sections 8.8;
(h) Purchaser shall make the payment described in Section 2.3;
(i) ARCO and Purchaser shall exchange the certificates described in
Sections 8.3 and 9.3;
(j) ARCO shall execute such other instruments and take such other
action as may be necessary to carry out its obligations under this
Agreement; and
(k) Purchaser shall execute such other instruments and take such other
action as may be necessary to carry out its obligations under this
Agreement.
(l) ARCO and Purchaser shall execute, acknowledge and deliver Surface
Lease Agreement in the form attached as Exhibit 10.2(l) leasing to
Purchaser the 24.4 acre tract of land at 1907 East Old Highway 80,
White Oak, Texas.
ARTICLE 11 - ADDITIONAL AGREEMENTS
11.1 CALCULATION OF ADJUSTED PURCHASE PRICE. Within 120 days after the
Closing, ARCO shall prepare, in accordance with this Agreement and with
generally accepted accounting principles consistently applied, and deliver to
Purchaser a statement setting forth each adjustment to the Purchase Price
required pursuant to Section 2.2 and showing the calculation of each such
adjustment. Within 30 days after receipt of such statement from ARCO, Purchaser
shall deliver to ARCO a written report containing all changes with explanations
therefor that Purchaser proposes be made to such statement, it being agreed that
Purchaser's failure to deliver such report to ARCO within such time period shall
constitute acceptance by Purchaser of ARCO's statement. From and after the
expiration of such 30-day period, no additional changes to the statement
provided by ARCO shall be considered by the parties. If Purchaser has timely
delivered such written report, the parties shall then undertake to agree on the
items
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in dispute and the final Adjusted Purchase Price no later than 30 days
after the receipt by ARCO of Purchaser's statement of proposed changes (it being
agreed that any disputes as to adjustments relating to Title Defects shall be
resolved prior to such time pursuant to the provisions of Article 3). Following
the final determination of the Adjusted Purchase Price pursuant to this Section
11.1, ARCO or Purchaser, as the case may be, shall make the payment required
pursuant to Section 2.4.
11.2 SUSPENDED FUNDS. As soon as practicable after the Closing, ARCO
shall provide to Purchaser a listing showing all proceeds from production
attributable to the Leasehold Interests that are currently held in suspense and
shall transfer to Purchaser all such suspended proceeds. Upon receipt of such
funds and an appropriate accounting thereof, Purchaser shall be responsible for
proper distribution of all the suspended proceeds to the parties lawfully
entitled to them, and hereby agrees to indemnify, defend and hold harmless ARCO
from and against any and all claims, liabilities, losses, costs and expenses
(including, without limitation, court costs and reasonable attorneys' fees)
arising out of or relating to such suspended proceeds but only to the extent of
the funds actually transferred by ARCO to Purchaser representing such suspended
proceeds.
11.3 RECEIPTS AND CREDITS. Subject to the terms hereof and in
accordance with the provisions of Section 11.1 herein, and except to the extent
same have already been taken into account as an adjustment to the Purchase
Price, all monies, proceeds, receipts, credits and income attributable to the
Assets (a) for all periods of time subsequent to the Effective Date, shall be
the sole property and entitlement of Purchaser, and, to the extent received by
ARCO, ARCO shall fully disclose, account for and transmit same to Purchaser and
(b) for all periods of time prior to the Effective Date, shall be the sole
property and entitlement of ARCO and, to the extent received by Purchaser,
Purchaser shall fully disclose, account for and transmit same to ARCO promptly.
Subject to the terms hereof and in accordance with the provisions of Section
11.1 herein, and except to the extent same have already been taken into account
as an adjustment to the Purchase Price, all costs, expenses, disbursements,
obligations and liabilities attributable to the Assets (i) for periods of time
prior to the Effective Date, regardless of when due or payable, shall be the
sole obligation of ARCO and ARCO shall pay, or if paid by Purchaser, promptly
reimburse Purchaser for and hold Purchaser harmless from and against same and
(ii) for periods of time subsequent to the Effective Date, regardless of when
due or payable, shall be the sole obligation of Purchaser and Purchaser shall
promptly pay, or if paid by ARCO, promptly reimburse ARCO for and hold ARCO
harmless from and against same. Except to the extent same have already been
taken into account as an adjustment to the Purchase Price, all uncollected
accounts receivable as of the Closing Date attributable to the Assets after the
Effective Date shall be assigned to Purchaser, and all uncollected accounts
receivable as of the Closing Date attributable to the Assets prior to the
Effective Date shall be retained by ARCO.
11.4 ASSUMPTION OF LIABILITIES; CROSS INDEMNITY. If the Closing occurs,
ARCO and Purchaser agree as follows:
(a) Purchaser hereby assumes and agrees to pay, perform and discharge
the following liabilities and obligations (collectively, the "Assumed
Obligations"):
(i) subject to the terms of Article 16, all liabilities and
obligations that are attributable to the ownership or
operation of the Assets on or after the Effective Date
(specifically excluding damage to property or injury to or
death of persons, in each case occurring after the Effective
Date but prior to the Closing Date);;
(ii) subject to the terms of Article 16, all liabilities and
obligations to properly plug and abandon all wells and remove
all related facilities and equipment now or hereafter located
on the Leasehold Interests and clean up and restore the
Leasehold Interests (including all obligations to clean, close
and abandon all pits and impoundments) in accordance with
applicable laws (regardless of whether any such obligation to
plug, abandon, remove, clean up and restore is attributable to
periods of time prior to or after the Effective Date); and
(iii) to the extent and only to the extent such matters are
disclosed on Exhibit 2.2, any and all obligations to make up,
deliver or pay for oil, gas or other hydrocarbons under (A)
any gas balancing or similar arrangements affecting the Assets
in respect of amounts owed thereunder by ARCO as of the
Effective Date, and (B) any take-or-pay, prepayment or similar
provisions of any production sales contracts included in the
Assets, to the extent any purchaser of production thereunder
has the right to apply any amounts received by ARCO pursuant
to such provisions as an offset against amounts otherwise due
for production or delivery of oil, gas or hydrocarbons not
delivered prior to the Effective Date;
(b) Subject to the terms of Article 13, which shall control with
respect to the tax matters covered thereby, and Article 16, which shall
control with respect to the matters covered thereby, Purchaser agrees
to indemnify, defend and hold harmless the ARCO Indemnified Parties
from and against any and all claims, liabilities, losses, costs and
expenses (including, without limitation, court costs and reasonable
attorneys' fees, but excluding any amounts reimbursed from third party
insurance) (collectively, "Losses") that are attributable to (i) the
Assumed Obligations or (ii) a breach by Purchaser of its
representations, warranties, covenants and agreements hereunder, IN
EACH CASE WITHOUT REGARD TO THE SOLE, PARTIAL OR CONCURRENT NEGLIGENCE,
GROSS NEGLIGENCE, STRICT LIABILITY, WILLFUL MISCONDUCT OR OTHER FAULT
OF THE ARCO INDEMNIFIED PARTIES;
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(c) Subject to the terms of Article 13, which shall control with
respect to the tax matters covered thereby, and the terms of Article
16, which shall control with respect to the matters covered thereby,
ARCO agrees to indemnify, defend and hold harmless Purchaser and its
agents and representatives (the "Purchaser Indemnified Parties") from
and against any and all Losses that are attributable to (i) a breach by
ARCO of its representations, warranties, covenants and agreements
hereunder, or (ii) the lawsuits listed on Exhibit 9.6 and any other
pending lawsuits not listed on Exhibit 9.6 for which ARCO has received
actual notice on or before the Closing Date or (iii) the ownership or
operation of the Assets before the Effective Date (excluding any
matters and related Losses with respect to which Purchaser has agreed
to indemnify, defend and hold harmless the ARCO Indemnified Parties
pursuant to clause (b) above, Article 16 or elsewhere herein, or any
matter with respect to which Purchaser has waived claims against ARCO,
or released ARCO from liability, pursuant to Section 3.8 or elsewhere
hereunder), IN EACH CASE WITHOUT REGARD TO THE SOLE, PARTIAL OR
CONCURRENT NEGLIGENCE, GROSS NEGLIGENCE, STRICT LIABILITY, WILLFUL
MISCONDUCT OR OTHER FAULT OF THE PURCHASER INDEMNIFIED PARTIES;
(d) The indemnity, defense and hold harmless obligations set forth in
Sections 11.4(b) and (c) above shall not apply to (i) a claim for
indemnification by a party that relates to any amount or item for which
such party received credit as an adjustment to the Purchase Price
pursuant to the provisions hereof, (ii) either party's costs and
expenses with respect to the negotiation and consummation of this
Agreement and the transactions contemplated hereby or (iii) any Title
Defect claims of Purchaser; and
(e) EACH PARTY ACKNOWLEDGES AND AGREES THAT THE INDEMNITY, DEFENSE AND
HOLD HARMLESS OBLIGATION SET FORTH IN SECTIONS 11.4(b) AND (c) ABOVE
ARE INTENDED TO AND CONSTITUTE AN AGREEMENT OF PURCHASER, IN THE CASE
OF SECTION 11.4(b), AND ARCO, IN THE CASE OF SECTION 11.4(c), TO
INDEMNIFY AND PROTECT THE OTHER PARTY FROM THE CONSEQUENCES OF SUCH
OTHER PARTY'S OWN NEGLIGENCE, STRICT LIABILITY, OR OTHER FAULT,
REGARDLESS OF WHETHER SAME IS THE SOLE, PARTIAL OR CONCURRING CAUSE OF
ANY APPLICABLE LOSSES AND, IN THE CASE OF NEGLIGENCE, REGARDLESS OF
WHETHER SAME IS ACTIVE OR PASSIVE, OR THE RESULT OF AN AFFIRMATIVE ACT
OR OMISSION.
11.5 FURTHER ASSURANCES. After Closing, ARCO and Purchaser agree to
take such further actions and to execute, acknowledge and deliver such
additional documents and instruments as may be necessary or useful in carrying
out the purposes of this Agreement or of any document delivered pursuant hereto.
ARTICLE 12 - TERMINATION
12.1 RIGHT OF TERMINATION. This Agreement and the transactions
contemplated hereby may be terminated:
(a) Pursuant to any provisions of this Agreement expressly permitting
termination by a party;
(b) At any time at or prior to Closing by mutual consent of ARCO and
Purchaser; or
(c) At any time at or after October 1, 1999, by ARCO or Purchaser, by
the delivery of written notice to the other party, if the Closing shall
not have occurred by such date;
provided, however no such party may exercise any right of termination pursuant
to this Section 12.1 if the event giving rise to such termination right shall be
due to the willful failure of such party to perform or observe in any material
respect any of the covenants or agreements set forth herein to be performed or
observed by such party.
12.2 EFFECT OF TERMINATION. If this Agreement is terminated pursuant to
Section 12.1, this Agreement shall become void and of no further force or effect
(except for the provisions of Sections 4.4, 5.4, 7.1, 7.2, 7.3, 17.1 through
17.8, 17.11, and 17.12, which shall survive such termination and continue in
full force and effect); provided, however, that, if either party is in default
of its obligations under this Agreement at the time this Agreement is so
terminated, such defaulting party shall continue to be liable to the other party
for damages (but in no event for specific performance) in respect of such
default and such liability shall not be affected by such termination (unless
ARCO becomes entitled to retain the Deposit as provided in Section 2.1(d), in
which case such retention of the Deposit shall constitute ARCO's sole remedy for
Purchaser's failure to consummate the transactions contemplated hereunder).
Notwithstanding anything to the contrary contained in this Agreement, upon any
termination of this Agreement pursuant to Section 12.1, ARCO shall be free
immediately to enjoy all rights of ownership of the Assets and to sell,
transfer, encumber or otherwise dispose of the Assets to any party without any
restriction under this Agreement; and Purchaser shall be liable for all actual,
incidental and consequential damages (including, without limitation, lost
profits) if it attempts to interfere in any way with any such enjoyment or
action by ARCO.
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ARTICLE 13 - TAXES
13.1 APPORTIONMENT OF AD VALOREM AND PROPERTY TAXES. All ad valorem
taxes, real property taxes, personal property taxes and similar obligations
("Property Taxes") attributable to the Assets with respect to the tax period in
which the Effective Date occurs shall be apportioned as of the Effective Date
between ARCO and Purchaser. The owner of record on the assessment date shall
file or cause to be filed all required reports and returns incident to the
Property Taxes and shall pay or cause to be paid to the taxing authorities all
Property Taxes relating to the tax period on which the Effective Date occurs. If
ARCO is the owner of record on the assessment date, then Purchaser shall pay to
ARCO Purchaser's pro rata portion of Property Taxes within 30 days after receipt
of ARCO's invoice therefor, except to the extent taken into account as an
adjustment to the Purchase Price pursuant to Section 2.2. If Purchaser is the
owner of record as of the assessment date then ARCO shall pay to Purchaser
ARCO's pro rata portion of Property Taxes within 30 days after receipt of
Purchaser's invoice therefor.
13.2 SALES TAXES. The Purchase Price provided for hereunder excludes
any sales taxes or other taxes required to be paid in connection with the sale
of the Assets pursuant to this Agreement. Purchaser, however, shall be liable
for any sales and use taxes, conveyance, transfer and recording fees and real
estate transfer stamps or taxes that may be imposed on any transfer of the
Assets pursuant to this Agreement. ARCO shall, in accordance with applicable
law, collect and remit any sales or similar taxes that are required to be paid
as a result of the transfer of the Assets by ARCO to Purchaser. If the transfer
of the Assets pursuant to this Agreement is exempt from applicable sales or
similar taxes, Purchaser shall, at Closing, provide ARCO with properly executed
exemption certificates or other documentation acceptable under applicable law.
13.3 OTHER TAXES. All taxes (other than income taxes) attributable to
the Assets that are imposed on or with respect to the production of oil, natural
gas or other hydrocarbons or minerals or the receipt of proceeds therefrom
(including but not limited to severance, production, and excise taxes) shall be
apportioned between the parties based upon the respective shares of production
taken by the parties. All such taxes that have accrued with respect to the
period prior to the Closing Date have been or will be properly paid or withheld
by ARCO (although such taxes for the period between the Effective Date and the
Closing Date will be taken into account as an adjustment to the Purchase Price
pursuant to Section 2.2(a)(i)) and all statements, returns, and documents
pertinent thereto have been or will be properly filed. Purchaser shall be
responsible for paying or withholding or causing to be paid or withheld all such
taxes which have accrued after the Closing Date and for filing all statements,
returns, and documents incident thereto.
13.4 COOPERATION. Each party to this Agreement shall provide the other
party with reasonable access to all relevant documents, data and other
information (other than that which is subject to an attorney-client privilege)
which may be required by the other party for the purpose of preparing tax
returns, filing refund claims and responding to any audit by any taxing
jurisdiction. Each party to this Agreement shall cooperate with all reasonable
requests of the other party made in connection with contesting the imposition of
taxes. Notwithstanding anything to the contrary in this Agreement, neither party
to this Agreement shall be required at any time to disclose to the other party
any tax return or other confidential tax information. Except where disclosure is
required by applicable law or judicial order, any information obtained by a
party pursuant to this Section 13.4 shall be kept confidential by such party,
except to the extent disclosure is required in connection with the filing of any
tax returns or claims for refund or in connection with the conduct of an audit,
or other proceedings in response to an audit, by a taxing jurisdiction.
13.5 INDEMNIFICATION FOR TAX.
(a) Subject to the provisions of Section 13.5(b), ARCO shall indemnify
Purchaser for all liabilities that are assessed against Purchaser for
foreign, federal, state, local or Indian Tribal taxes (other than
income taxes) in respect of the ownership or operation of the Assets
prior to the Effective Date, together with penalties and interest
thereon (provided such penalties and interest do not result from the
negligence, late filing, fraud or acts of misfeasance or malfeasance of
Purchaser), to the extent such liabilities exceed the amounts of such
taxes paid by ARCO; provided that ARCO shall be entitled to all refunds
or rebates of taxes paid in respect of the ownership or operation of
the Assets prior to the Effective Date that may be received by ARCO or
Purchaser. Subject to the provisions of Section 13.5(b), Purchaser
shall indemnify ARCO for all liabilities which are assessed against
ARCO for foreign, federal, state, local or Indian Tribal taxes (other
than income taxes), together with penalties and interest thereon
(provided such penalties and interest do not result from the
negligence, late filing, fraud or acts of misfeasance or malfeasance of
ARCO), to the extent such liabilities relate to the ownership or
operation of the Assets from and after the Effective Date; provided,
however, that such indemnity shall not apply to windfall profit,
severance or production taxes on oil and gas production from the Assets
on or after the Effective Date to the extent (but only to the extent)
such taxes are included in the determination of the Adjusted Purchase
Price, and provided further, however, that Purchaser shall be entitled
to all refunds or rebates of windfall profit, severance or production
taxes on oil and gas production from the Assets on or after the
Effective Date that may be received by ARCO or Purchaser, except to the
extent (but only to the extent) such refunds or rebates are included in
the determination of the Adjusted Purchase Price.
(b) In order for ARCO or Purchaser ("Claimant") to make a claim against
the other ("Indemnitor") under this Article 13, Claimant shall give
prompt notice to Indemnitor of any liability
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for which Claimant would claim indemnification under this Article 13,
which notice shall include the circumstances surrounding such
liability. Indemnitor shall then have the right but not the
obligation, to contest such liability at its sole cost and expense by
giving written notice to Claimant of such election within 30 days
after Indemnitor receives Claimant's notice. Should Indemnitor fail to
notify Claimant within such 30-day period, Indemnitor shall be deemed
to have elected not to contest such liability. Should Indemnitor elect
(or be deemed to have elected) not to contest such liability,
Indemnitor shall pay the full amount due under Section 13.5(a) in
respect of such liability to Claimant in cash within 30 days after
Indemnitor elects (or is deemed to have elected) not to contest such
liability. Except as specifically provided in this Section 13.5 with
respect to certain tax issues which must be combined or joined with
other tax issues, if Indemnitor elects to contest any such liability,
Claimant shall give Indemnitor full authority to defend, adjust,
compromise or settle such liability and any action, suit, or
proceeding in which Indemnitor contests such liability, in the name of
Claimant or otherwise as Indemnitor shall elect. In any administrative
or legal proceeding, Indemnitor shall employ counsel selected by it
and reasonably acceptable to Claimant. With respect to tax issues
incident to any such liability that must be combined or joined with
one or more other tax issues which Claimant desires to contest,
Claimant and Indemnitor shall cooperate fully, and control of any
administrative legal proceeding shall rest with the party having the
greater ultimate liability (including liability under Section 13.5(a)
for the taxes in dispute). The party in control may not adjust,
compromise or settle taxes which are contested by or on behalf of the
other party without the consent of the other party. With respect to
any liability contested by Indemnitor under the terms of this Section
13.5(b), Indemnitor shall pay the full amount due under Section
13.5(a) in respect of such liability to Claimant in cash within 30
days after the liability is finally determined either by settlement or
pursuant to the final unappealable judgment of a court of competent
jurisdiction.
ARTICLE 14 - DOCUMENT RETENTION
14.1 INSPECTION. As used in this Article 14, "Documents" shall mean all
files, documents, books and records delivered to Purchaser by ARCO that relate
to the Assets, including, but not limited to: financial and tax accounting
records; land, title and division of interest files; contracts; engineering and
well files; and books and records related to the operation of the Assets during
the Interim Period. Subject to the provisions of Section 14.2, Purchaser agrees
that the Documents shall be open for inspection by representatives of ARCO at
reasonable times and upon reasonable notice during regular business hours for a
period of 10 years following the date of Closing (or for such longer period as
may be required by law or governmental regulation), and that ARCO may during
such period at its expense make such copies thereof as it may reasonably
request.
14.2 DESTRUCTION. For a period of 10 years after the date of Closing
(or for such longer period as may be required by law or governmental
regulation), Purchaser shall not destroy or give up possession of any original
or final copy of the Documents without first offering ARCO the opportunity (by
delivery of written notice to ARCO as provided in Section 17.1, with an
additional copy of such notice delivered to the attention of ARCO's Tax
Department), at ARCO's expense (without any payment to Purchaser), to obtain
such original or final copy or a copy thereof. After the conclusion of such
period, Purchaser shall offer to deliver to ARCO, at ARCO's expense (without any
payment to Purchaser), the Documents prior to destroying the same.
14.3 ACCESS. ARCO and Purchaser each shall use its best efforts to
afford the other access to (a), in the case of ARCO, employees of ARCO who
remain employees of ARCO following the date of Closing and are familiar with the
operations of the Assets and (b) in the case of Purchaser, employees of
Purchaser which ARCO shall reasonably request for its proper corporate purposes,
including without limitation, the defense of legal proceedings. Such access may
include interviews or attendance at depositions or legal proceedings; provided,
however, that in any event all out-of-pocket expenses (including wages and
salaries) reasonably incurred by any party in connection with this Section 14.3
shall be paid or promptly reimbursed by the party requesting such services.
ARTICLE 15 - INDEPENDENT INVESTIGATION AND DISCLAIMER
15.1 INDEPENDENT INVESTIGATION AND DISCLAIMER. Purchaser acknowledges
that (a) it has had and pursuant to this Agreement will have prior to the
Closing access to the Assets and the employees of ARCO and (b) in making the
decision to enter into this Agreement and consummate the transactions
contemplated hereby, Purchaser has relied solely on the basis of its own
independent investigation of the Assets and upon the representations,
warranties, covenants and agreements set forth in this Agreement. Accordingly,
Purchaser acknowledges that, except as expressly set forth herein, ARCO has not
made, AND ARCO HEREBY EXPRESSLY DISCLAIMS AND NEGATES, ANY REPRESENTATION OR
WARRANTY, EXPRESSED, IMPLIED, AT COMMON LAW, BY STATUTE, OR OTHERWISE RELATING
TO (i) THE CONDITION OF THE ASSETS (INCLUDING WITHOUT LIMITATION, ANY IMPLIED OR
EXPRESSED WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR OF
CONFORMITY TO MODELS OR SAMPLES OF MATERIALS, OR ENVIRONMENTAL CONDITION), (ii)
ANY INFRINGEMENT BY ARCO OF ANY PATENT OR PROPRIETARY RIGHT OF ANY THIRD PARTY,
AND (iii) ANY INFORMATION, DATA OR OTHER MATERIALS (WRITTEN OR ORAL) FURNISHED
TO PURCHASER BY OR ON BEHALF OF ARCO (INCLUDING, WITHOUT LIMITATION, IN RESPECT
OF GEOLOGICAL, GEOPHYSICAL AND SEISMIC DATA, THE EXISTENCE OR EXTENT OF OIL, GAS
OR OTHER MINERAL RESERVES, THE
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RECOVERABILITY OF OR THE COST OF RECOVERING ANY SUCH RESERVES, THE VALUE OF SUCH
RESERVES, ANY PRODUCT PRICING ASSUMPTIONS, AND THE ABILITY TO SELL OIL OR GAS
PRODUCTION AFTER CLOSING AND THE ABILITY OF PURCHASER TO BECOME OPERATOR OF THE
ASSETS UNDER THE APPLICABLE OPERATING AGREEMENT); AND PURCHASER WILL HAVE SOLE
RESPONSIBILITY FOR ANY ACTION TAKEN BY PURCHASER, OR BY OTHERS RELYING ON
PURCHASER'S ADVICE, BASED ON THE GEOLOGICAL MAPS, RECORDS, LOGS AND OTHER DATA,
IF ANY, TRANSFERRED UNDER THIS AGREEMENT; provided, however, that the foregoing
disclaimer and negation of representations and warranties shall not affect or
impair the representations and warranties of ARCO set forth in Article 4 hereof.
As used in the disclaimer provisions of this Section 15.1, "ARCO" shall include
ARCO's agents, representatives and consultants.
ARTICLE 16 - ENVIRONMENTAL MATTERS
16.1 PHYSICAL AND ENVIRONMENTAL CONDITIONS. Purchaser agrees and
acknowledges that (a) it has had, or prior to the Closing will have, access to
and the opportunity to inspect the Assets for all purposes, including without
limitation, for the purposes of detecting the presence of hazardous or toxic
substances, pollutants or other contaminants, environmental hazards, naturally
occurring radioactive materials (NORM) and produced water contamination of the
surface and/or subsurface, (b) it has, or prior to the Closing will have,
satisfied itself as to the physical and environmental condition of the Assets,
both surface and subsurface, and their method of operation and except as set
forth herein, agrees to accept an assignment of the Assets at Closing on an "AS
IS, WHERE IS" basis, "WITH ALL FAULTS" and (c) in making the decision to enter
in this Agreement and consummate the transactions contemplated hereby, Purchaser
has relied solely on the basis of its own independent investigation of the
Assets and the records related thereto (including the Environmental Reports (as
defined below)). Accordingly, Purchaser further acknowledges that with respect
to any tests, evaluations or reports that have been conducted or prepared by or
on behalf of ARCO pertaining to the environmental condition or operation of the
Assets and that are delivered to Purchaser prior to the date hereof (the
"Environmental Reports"), ARCO EXPRESSLY DISCLAIMS AND NEGATES ANY
REPRESENTATION OR WARRANTY RESPECTING THE ACCURACY OR THOROUGHNESS THEREOF AND
DISCLAIMS ANY LIABILITY IN CONNECTION THEREWITH, IN EACH CASE WITHOUT REGARD TO
THE SOLE, PARTIAL OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT OF
ARCO. Purchaser further acknowledges that it has reviewed, examined and
thoroughly familiarized itself with the contents of the Environmental Reports.
16.2 GENERAL ENVIRONMENTAL INDEMNITY. If the Closing occurs, except as
provided in the proviso clause of the first sentence of this Section 16.2 and
without limiting Purchaser's obligations under Section 11.4, Purchaser hereby
assumes and shall be responsible for and agrees to indemnify, defend and hold
harmless the ARCO Indemnified Parties from and against any and all Losses
attributable to damage to property, injury to or death of persons or other
living things, natural resource damages, CERCLA response costs, environmental
remediation and restoration costs, or fines or penalties (collectively,
"Claims") arising out of or attributable to, in whole or in part, either
directly or indirectly, the ownership, condition or operation of the Assets at
any time before, at or after the Effective Date (including, without limitation,
any Claims relating to any condition existing on, in or under, or resulting from
operation of, the Assets as of the Effective Date) WITHOUT REGARD TO THE SOLE,
PARTIAL OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT OF THE ARCO
INDEMNIFIED PARTIES; provided, however, that ARCO shall indemnify, defend and
hold harmless the Purchaser Indemnified Parties from and against any Claim
arising out of or attributable to, in whole or in part, either directly or
indirectly, the condition or operation of the Assets at any time before the
Effective Date that is determined to be the result of or caused in whole or in
part by ARCO's violation of, failure to fulfill duties imposed by or incurrence
of liability under, any Environmental Laws (as in effect on the Effective Date)
(other than any such Claims resulting from or attributable in whole or in part
to conditions or operations disclosed in the Environmental Reports or known to
Purchaser as of the date hereof), to the extent that such Claim has been finally
determined in a third-party lawsuit or administrative proceeding or order that
is filed, issued or commenced against Purchaser on or before the first
anniversary of the Closing Date. In no event shall ARCO's aggregate liability
pursuant to the proviso clause of the immediately preceding sentence exceed an
amount equal to $500,000.00. Notwithstanding anything to the contrary
hereinabove, ARCO agrees to fully indemnify, defend and hold Purchaser harmless
from and against the Claims arising or that may arise in that certain lawsuit
known as Harris, et al., v. East Texas Salt Water Disposal Company, et al., as
described on Exhibit 9.6, to the extent of and attributable to Purchaser's
ownership of the Assets transferred herein, regardless of when such Claims are
made.
16.3 ENVIRONMENTAL LAWS. As used herein, the term "Environmental Laws"
shall mean any and all federal, state and local statutes, regulations, rules,
orders, ordinances, or permits of any governmental authority pertaining to
health, the environment, wildlife or natural resources in effect in any and all
jurisdictions in which the Assets are located, including, without limitation,
the Clean Air Act, as amended, and the Federal Water Pollution Control Act, as
amended, the Rivers and Harbors Act of 1899, as amended, the Safe Drinking Water
Act, as amended, the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA"), as amended, the Superfund Amendments and
Reauthorization Act of 1986 ("SARA"), as amended, the Resource Conservation and
Recovery Act ("RCRA"), as amended, The Hazardous and Solid Waste Amendments Act
of 1984, as amended, the Toxic Substances Control Act, as amended, the
Occupational Safety and Health Act ("OSHA"), as amended, and the Hazardous
Materials Transportation Act, as amended.
Purchase and Sale Agreement Page 21
<PAGE> 22
16.4 ENVIRONMENTAL ASSESSMENT. Purchaser shall have the right for a
period commencing upon execution of this Agreement by both parties and ending on
August 13, 1999, to conduct an environmental assessment of the Assets, at
Purchaser's sole risk, liability and expense. ARCO shall make available to
Purchaser, during the environmental assessment period described above, ARCO's
historical files regarding prior operations on the Assets, and provide Purchaser
and its representatives with reasonable access to the Assets to conduct the
environmental assessment. ARCO shall have the right to be present during any
assessment and, if any testing is conducted, ARCO may require splitting of all
samples.
16.5 INDEMNIFICATION OF MATERIAL ADVERSE ENVIRONMENTAL CONDITIONS.
Purchaser shall advise ARCO of any material adverse environmental condition
("Condition") of the Assets which it finds unacceptable and shall provide
evidence thereof on or before the end of the environmental assessment period
provided for in Section 16.4. For the purposes of this Section 16.5 a Condition
shall be "material" only if the cost to remediate said Condition to levels
reasonably acceptable to Purchaser to assure compliance with all applicable
environmental laws or other directives exceeds $10,000.00. Purchaser shall treat
all information regarding any Condition as confidential, whether material or
note, and shall not make any contact with any governmental authority or third
party regarding same without ARCO's written consent, unless required by
applicable law or other directive.
16.6 REMEDIES FOR IDENTIFIED CONDITIONS. Upon receipt of such notice
with respect to each Condition identified by Purchaser, ARCO shall propose to
Purchase to either (i) agree with Purchaser on an adjustment to the Purchaser
Price, which adjustment shall reflect the cost to remediate such Condition; (ii)
if reasonably feasible, remove the affected Assets from the Assets being
conveyed and adjust the Purchase Price accordingly; or (iii) agree to indemnify
Purchaser from any and all damages, claims, losses and expenses pertaining to
the existence and remediation of such Condition. If ARCO's proposal is
unacceptable to Purchaser, then, unless Purchaser is willing to waive the
Condition(s), Purchase shall have the right to terminate this Agreement by
written notice to ARCO and be releases from all further obligations under this
Agreement.
ARTICLE 17 - MISCELLANEOUS
17.1 GOVERNING LAW. This Agreement and all instruments executed in
accordance with it shall be governed by and interpreted in accordance with the
laws of the State of Texas, without regard to conflict of law rules that would
direct application of the laws of another jurisdiction, except to the extent
that it is mandatory that the law of some other jurisdiction, wherein the Assets
are located, shall apply. The laws of the state wherein the Leasehold Interests
are located shall control as to all matters pertaining to title and Title
Defects pursuant to Article 3 herein, and to the evaluation of encumbrances
placed upon such Leasehold Interests pursuant to Section 3.3 herein.
17.2 ENTIRE AGREEMENT. This Agreement, including all Exhibits attached
hereto and made a part hereof, together with the Prior Confidentiality
Agreements, constitute the entire agreement between the parties with respect to
the subject matter hereof and thereof and supersede all prior agreements,
understandings, negotiations and discussions, whether oral or written, of the
parties with respect to same. No supplement, amendment, alteration,
modification, waiver or termination of this Agreement shall be binding unless
executed in writing by the parties hereto.
17.3 WAIVER. No waiver of any of the provisions of this Agreement shall
be deemed or shall constitute a waiver of any other provisions hereof (whether
or not similar), nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided.
17.4 CAPTIONS. The captions in this Agreement are for convenience only
and shall not be considered a part of or affect the construction or
interpretation of any provision of this Agreement.
17.5 ASSIGNMENT. Except as expressly provided herein to the contrary,
neither party hereto shall assign this Agreement or any of its rights or
obligations hereunder without the prior written consent of the other party and
any assignment made without such consent shall be void. Except as otherwise
provided herein, this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and permitted assigns.
After Closing, ARCO acknowledges and agrees that the restrictions set forth in
this Section 17.5 shall not obligate Purchaser to obtain the written consent of
ARCO prior to any assignment by Purchaser of its ownership interest in the
Assets, and Purchaser acknowledges and agrees that any such assignment shall not
release Purchaser from any of its liabilities or obligations hereunder. nor
extend or increase any of the liabilities or obligations of ARCO hereunder.
17.6 NOTICES. Any notice provided or permitted to be given under this
Agreement shall be in writing, and may be served by personal delivery or by
depositing same in the mail, addressed to the party to be notified, postage
prepaid, and registered or certified with a return receipt requested. Notice
deposited in the mail in the manner hereinabove described shall be deemed to
have been given and received on the date of the delivery as shown on the return
receipt. Notice served in any other manner shall be deemed to have been given
and received only if and when actually received by the addressee (except that
notice given by telecopier shall be deemed given and received upon receipt only
if received during normal business hours and if received other than during
normal business hours shall be deemed received as of the opening of business on
the next Business Day). For purposes of notice, the addresses of the parties
shall be as follows:
Purchase and Sale Agreement Page 22
<PAGE> 23
For ARCO:
Street Address: Mailing Address:
Atlantic Richfield Company Atlantic Richfield Company
600 North Marienfeld P. O. Box 1610
Midland, Texas 79701 Midland, Texas 79702
Attn: Business Development
Telecopy No.: 915/688-5956
For Purchaser:
Street Address: Mailing Address:
Future Acquisition 1995, Ltd. Future Acquisition 1995, Ltd.
700 Louisiana, Suite 3700 700 Louisiana, Suite 3700
Houston, TX 77002 Houston, TX 77002
Attn: Tim J. Goff
Telecopy No.: 713/236-9799
Each party shall have the right, upon giving 10 days' prior notice to the other
in the manner hereinabove provided, to change its address for purposes of
notice.
17.7 EXPENSES. Except as otherwise provided herein, each party shall be
solely responsible for all expenses incurred by it in connection with this
transaction (including, without limitation, fees and expenses of its own counsel
and consultants). Purchaser shall pay for all documentary, filing and recording
fees required in connection with the filing and recording of the Conveyance,
Assignment and Bill of Sale delivered by ARCO to Purchaser at Closing. Within 45
days following Closing, Purchaser shall furnish ARCO with a statement setting
forth the recording information for each county wherein such Conveyance,
Assignment and Bill of Sale was recorded.
17.8 SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced under any rule of law, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in a materially adverse manner with respect
to either party.
17.9 PUBLICITY. ARCO and Purchaser shall consult with each other with
regard to all publicity and other releases issued at or prior to the Closing
concerning this Agreement and the transactions contemplated hereby and, except
as required by applicable law or the applicable rules or regulations of any
governmental body or stock exchange, neither party shall issue any publicity or
other release without the prior written consent of the other party.
17.10 USE OF ARCO'S NAME. As soon as practicable after the Closing,
Purchaser shall remove or cause to be removed the names and marks used by ARCO
and all variations and derivatives thereof and logos relating thereto from the
Assets and shall not thereafter make any use whatsoever of those names, marks
and logos. In the event Purchaser has not completed such removal within 120 days
after Closing, ARCO shall have the right but not the obligation to complete such
removal or cause such removal to be completed. and Purchaser shall reimburse
ARCO for any costs or expenses incurred by ARCO in connection therewith. ARCO
agrees to give Purchaser 48 hour notice (exclusive of Saturday, Sunday and legal
holidays) prior to the removal of any signs by ARCO at Purchaser's expense.
17.11 CONSEQUENTIAL DAMAGES. Except as expressly provided in Section
12.2, the parties waive any rights to incidental or consequential damages
resulting from a breach of this Agreement, including, without limitation, loss
of profits.
17.12 NO THIRD-PARTY BENEFICIARY. Except as expressly provided herein,
this Agreement is not intended to create, nor shall it be construed to create,
any rights in any third party under doctrines concerning third-party
beneficiaries.
17.13 SURVIVAL. Except with respect to the covenants set forth in
Sections 6.1 and 6.2, the representations, warranties, covenants and obligations
of the parties under this Agreement shall survive the Closing; provided,
however, that any claim with respect to the breach thereof may be made only if
the party claiming a breach thereof shall have notified the breaching party (i)
on or before the first anniversary of the Effective Date in the case of ARCO's
indemnification of Purchaser as set forth in Section 16.2, and (ii) on or before
the first anniversary of the Effective Date in the case of any indemnification
by ARCO for Title Defects pursuant to Section 3.5 and (iii) at any time in the
case of all other provisions.
17.14 COUNTERPART; EXHIBITS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. All Exhibits attached
hereto are hereby made a part of this Agreement and incorporated herein by this
reference.
Purchase and Sale Agreement Page 23
<PAGE> 24
17.15 ACCESS ACROSS LEASEHOLD INTERESTS. Purchaser agrees to allow ARCO
access, at no cost or expense to ARCO, to or across the Leasehold Interests, if
ARCO conducts future operations in the vicinity of the Leasehold Interests or if
ARCO exercises its rights under Section 17.10.
17.16 OPERATORSHIP MATTERS.
(a) Notwithstanding anything herein to the contrary, ARCO does not
represent to Purchaser that Purchaser will succeed to ARCO's
operatorship of any unit or well constituting a part of the Assets.
Purchaser acknowledges and agrees that Purchaser will be required to
comply with the terms of any applicable operating agreement, unit
operating agreement or other contract relating to any elections or
other selection procedures in order to succeed ARCO as operator
thereunder.
(b) ARCO shall prepare change of operatorship forms for signature by
Purchaser at Closing, and promptly following Closing shall cause such
forms to be filed with the appropriate authorities. Purchaser shall
reimburse ARCO for all filing and related fees, if any, incurred by
ARCO in connection with the filing of any change of operatorship forms
and shall provide ARCO with evidence of the acceptance by the
applicable government authority of any such change of operatorship.
17.17 CONFLICT WITH ASSIGNMENT. ARCO and Purchaser acknowledge and
agree that in the event of any conflict or inconsistency between the terms and
provisions of this Agreement and the terms and provisions of either the
Conveyance, Assignment and Bill of Sale or the Term Mineral Deed executed and
delivered at Closing by ARCO and Purchaser, the terms and provisions of this
Agreement shall control.
17.18 YEAR 2000 COMPLIANCE. In addition to, and not in alteration,
amendment or limitation of, any other provisions of this Agreement, Purchaser
expressly acknowledges and agrees that: (a) ARCO either has not assessed, or, if
it has assessed, has not (or may not have or not fully have) modified, replaced
or otherwise remediated, the Assets, including any components thereof or systems
related thereto or embedded therein, to determine whether they are Year 2000
Compliant, as defined herein. (b) If the Assets are not operated by ARCO, ARCO
is either unaware of, or has not verified any statements or representations made
by the Operator pertaining to, whether or not the Operator has made any such
assessment or taken any actions relating thereto, including modification,
replacement or other remediation. (c) IF ANY OF THE ASSETS, INCLUDING ANY
COMPONENTS THEREOF OR SYSTEMS RELATED THERETO OR EMBEDDED THEREIN, ARE NOT YEAR
2000 COMPLIANT, THEIR ABILITY TO MAINTAIN PRODUCTION OR OTHERWISE FUNCTION OR
OPERATE MAY BE AFFECTED. (d) AS BETWEEN PURCHASER AND ARCO, PURCHASER ASSUMES,
RELEASES ARCO FROM, AND AGREES TO DEFEND, INDEMNIFY AND HOLD ARCO HARMLESS FROM
AND AGAINST, ANY AND ALL RESPONSIBILITY AND LIABILITY FOR ANY CLAIMS OR PROBLEMS
RELATING TO OR ARISING FROM THE YEAR 2000 COMPLIANCE STATUS OF THE ASSETS,
INCLUDING ANY COMPONENTS THEREOF OR SYSTEMS RELATED THERETO OR EMBEDDED THEREIN,
and ARCO shall have no liability whatsoever for any Claims or problems Purchaser
may incur or encounter arising from or associated in any way with the Year 2000
Compliance status of the Assets, including any components thereof or systems
related thereto or embedded therein. (e) Any disclosures made by ARCO as to Year
2000 Compliance (including but not limited to disclosures as to ARCO's or the
Operator's or a manufacturer's/supplier's assessments, inventories, testing,
modification, replacement, etc.), whether made orally or in writing, and whether
made before or after Closing, are for informational purposes only and Purchaser
relies and depends on and uses any and all such disclosures exclusively and
entirely at its own risk and without any recourse to ARCO whatsoever. SUCH
DISCLOSURES DO NOT AND SHALL NOT CREATE OR BE CONSTRUED TO CREATE ANY EXPRESS OR
IMPLIED WARRANTIES ON THE PART OF ARCO, AND ANY SUCH EXPRESS OR IMPLIED
WARRANTIES ARE EXPRESSLY DISCLAIMED, INCLUDING BUT NOT LIMITED TO ANY IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. (f) "Year
2000 Compliant" means the Assets, including any components thereof or systems
related thereto or embedded therein, would: (i) Correctly process date
information before and after midnight, December 31, 1999. This would include
accepting date input, providing date output, and performing calculations and
comparisons on dates or portions of dates. Date interpretation would be correct
for all valid date values within the applicable domain; (ii) Function accurately
and without interruption before and after January 1, 2000 without any change in
operations associated with any date change and/or the advent of the new century;
(iii) Respond to two-digit input in a way that would resolve the ambiguity as to
the century in a disclosed, defined, and predetermined manner. Interfacing
software would make the same century assumptions when processing the two-digit
years; (iv) Process the Year 2000 as a leap year; (v) Correctly handle date
fields containing non-date information and correctly handle a date held in a
non-date field; and (vi) Correctly process any date with a year specified as
"99" and "00", regardless of other subjective meanings attached to these values.
17.19 DTPA WAIVER. TO THE EXTENT APPLICABLE TO THE ASSETS OR ANY
PORTION THEREOF, PURCHASER HEREBY WAIVES THE PROVISIONS OF THE TEXAS DECEPTIVE
TRADE PRACTICES ACT, CHAPTER 17, SUBCHAPTER E, SECTIONS 17.41 THROUGH 17.63,
INCLUSIVE (OTHER THAN SECTION 17.555, WHICH IS NOT WAIVED), TEX. BUS. & COM.
CODE. In order to evidence its ability to grant such waiver, Purchaser hereby
represents and warrants to ARCO that Purchaser (a) is in the business of seeking
or acquiring, by purchase or lease, goods or services for commercial or business
use, (b) has assets of $5 million or more according to its most recent financial
statement prepared in accordance with generally accepted accounting principles,
(c) has knowledge and experience in financial and business matters that enable
it to evaluate the merits and risks of the transaction contemplated hereby, and
(d) is not in a significantly disparate bargaining position.
Purchase and Sale Agreement Page 24
<PAGE> 25
17.20 ACKNOWLEDGMENT REGARDING CERTAIN PROVISIONS. EACH OF THE PARTIES
HERETO SPECIFICALLY ACKNOWLEDGES AND AGREES (A) THAT IT HAS A DUTY TO READ THIS
AGREEMENT AND THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS HEREOF,
(B) THAT IT HAS IN FACT READ THIS AGREEMENT AND IS FULLY INFORMED AND HAS FULL
NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS AND EFFECTS OF THIS AGREEMENT, (C)
THAT IT HAS BEEN REPRESENTED BY LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE
NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS AGREEMENT AND HAS RECEIVED THE
ADVICE OF SUCH COUNSEL IN CONNECTION WITH ENTERING INTO THIS AGREEMENT, AND (D)
THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS AGREEMENT PROVIDE FOR THE
ASSUMPTION BY ONE PARTY OF, AND/OR RELEASE OF THE OTHER PARTY FROM, CERTAIN
LIABILITIES ATTRIBUTABLE TO THIS TRANSACTION OR THE PREMISES COVERED HEREBY THAT
SUCH PARTY WOULD OTHERWISE BE RESPONSIBLE FOR UNDER THE LAW. EACH PARTY HERETO
FURTHER AGREES THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY
SUCH PROVISIONS OF THIS AGREEMENT ON THE BASIS THAT THE PARTY HAD NO NOTICE OR
KNOWLEDGE OF SUCH PROVISIONS OR THAT SUCH PROVISIONS ARE NOT "CONSPICUOUS".
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first set forth above:
ATLANTIC RICHFIELD COMPANY ("ARCO")
By:
---------------------------------------
Name: T. L. Holland
Title: Attorney in Fact
FUTURE ACQUISITION 1995, LTD. ("PURCHASER")
BY: FUTURE PETROLEUM CORPORATION,
ITS GENERAL PARTNER
By:
----------------------------------
Name: Tim J. Goff
Title: President
Purchase and Sale Agreement Page 25
<PAGE> 26
EXHIBIT A
Attached to and made a part of that certain Surface Lease dated October 1,
1999, by and between, Atlantic Richfield Company, as Lessor, and Future
Acquisition 1995, Ltd., as Lessee, covering the following described
tract of land:
BEING 24.405 acres of land located in the William Castleberry Survey, Gregg
County, Texas, said 24.405 acre tract of land being a part of the T. B.
Harris-Atlantic Refining Company's oil lease more particularly described in
that certain Assignment of Oil and Gas Lease dated July 27, 1931, by and
between, W. L. Pickens, Assignor, and Cranfill-Reynolds Company, Assignee,
as recorded in Volume 93, page 527, Deed Records, Gregg County, said 24.405
acres being more particularly described as follows:
BEGINNING at a point 368.5 feet South and 210.08 feet West of the most
Southerly Southeast corner of the T. B. Harris-Atlantic Refining Company
oil lease, said point being 26 feet North of the center line of Old Highway
80;
THENCE: N. 89 deg. 16' W., 50.0 feet along and with the Atlantic Refining
Company's Amended Surface Lease dated August 4, 1975, recorded in Volume
989, page 97, Deed Records, Gregg County, Texas, amending the original
Surface Lease dated July 24, 1940, recorded in Volume 252, pages 243-249,
Deed Records, Gregg County, Texas, being "Said Surface Lease" reference is
hereby made for the purpose of all legal descriptions, to a 3/8" iron rod
for corner;
THENCE: Along and with the West ROW line of an existing oil road the
following bearings and distances; N. 8 deg. 59' W., 217.4 feet, N. 18 deg.
49' W, 87.4 feet; N. 38 deg. 10' W., 117.30 feet; N. 41 deg. 13' W., 102.7
feet, N. 32 deg. 02' W., 58.4 feet, and N. 22 deg. 17' W., 56.00 feet to a
3/8" iron rod in same for corner;
THENCE: N. 85 deg. 45' W., 414.6 feet to a 3/8" iron rod for corner;
THENCE: S. 2 deg. 13' E., 591.0 feet to a 3/8" iron rod 26 feet North of
the center line of Old Highway 80 for corner;
THENCE: N. 89 deg. 16' W., 608.9 feet along and with said Atlantic Refining
Company's Said Surface Lease, as amended, 26 feet North of the center line
of Old Highway 80 to a 3/8" iron rod for corner; said point being the SW
corner of Said Surface Lease, as amended;
THENCE: Along and with the WBL of Said Surface Lease, as amended, the
following bearings and distances; N. 2 deg. 09' W., 468.0 feet, N. 34 deg.
28' W., 418.0 feet and N. 3 deg. 51' W., 225.8 feet to a point in the same
for corner;
THENCE: S. 86 deg. 42' E., 234.90 feet to a 3/8" iron rod for corner, said
iron rod being 15.0 feet West of a fence corner post;
THENCE: N. 3 deg. 28' E., 242.0 feet, 15.0 feet West and parallel to a
chain link fence line to a 3/8" iron rod for corner, said iron rod being
15.0 feet West and 15.0 feet North of a fence corner post;
THENCE: S. 86 deg. 38' E., 586.0 feet, 15.0 feet from and parallel to an
existing chain link fence line to a 3/8" iron rod for corner;
THENCE: S. 43 deg. 06' E., 594.2 feet and S. 18 deg. 20' E., 240.2 feet to
a 3/8" iron rod in the East ROW line of an existing oil road for corner;
THENCE: Along and with the East ROW line of said road the following
bearings and distances S. 22 deg. 13' E., 50.0 feet, S. 32 deg. 04' E.,
50.0 feet, S. 41 deg. 18' E., 100.0 feet, S. 38 deg. 07' E., 127.2 feet, S.
18 deg. 46' E., 100.2 feet and S. 8 deg. 48' E., 230.0 feet to PLACE OF
BEGINNING, containing 24.405 acres of land, more or less.
<PAGE> 27
EXHIBIT "A"
ATTACHED TO AND MADE A PART OF THAT CERTAIN PURCHASE AND SALE AGREEMENT DATED
EFFECTIVE AS OF OCTOBER 1, 1999, BY AND BETWEEN ATLANTIC RICHFIELD COMPANY
(ARCO) AND FUTURE ACQUISITION 1995, LTD. (PURCHASER)
IN ADDITION TO ANY OTHER DEPTH LIMITATIONS EXPRESSED HEREIN, IT IS THE EXPRESS
INTENTION TO LIMIT THE DESCRIPTIONS OF ARCO'S INTEREST (IF ANY), FROM THE
SURFACE DOWN TO THE BASE OF THE DEEPEST PRODUCING FORMATION
GREGG COUNTY
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000049-001 A. A. King and wife, J. R. Stebbins 10-15-30 62 65
A. A. King "A" (s) Lottie King
414536400
100% WI
87.500% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000049-001 290 acres more or less out of the AR-105265-000
A. A. King "A" (s) N. E. corner of the P. W. Purchase and Sale Agreement dated October 6,
414536400 Warraner Survey on the S. bank of 1995 by and between East Texas Gathering
100% WI the Sabine River, Gregg County, Company, Atlantic Richfield Company, Sun Pipe
87.500% NRI Texas, and more particularly Line Company and Sun Company, Inc. (s)
described in that certain Oil and
Gas Lease dated October 15, 1930, AR-105265-001
recorded in Volume 62, Page 65, Crude Oil Buy/Sell Contract dated effective
Deed Records, Gregg County, Texas. December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-23556
Oil Well Gas Contract dated July 3, 1962, by
and between The Atlantic Refining Company,
Seller and Sinclair Oil & Gas Company, Buyer
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 1 of 165
<PAGE> 28
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000041-001 A. A. King and wife, J. R. Stebbins 10-15-30 61 220
A. A. King "B" (s) Lottie King, and S.
414537200 G. Andrews and wife,
100% WI Myrtle Andrews
87.50% NRI
A. A. King "D" (s)
414538100
100% WI 42-183-090518-000 Viola King Kinsey, et Atlantic Richfield 2-1-89 ---- ----
87.5% NRI (Surface Lease for al Company
A. A. King "B")
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000042-001 A. A. King and wife, J. R. Stebbins 10-15-30 62 63
A. A. King "C" (s) Lottie King
414539900
100% WI
87.5% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000041-001 Five tracts of land situated in Texas Natural Resources Conservation
A. A. King "B" (s) Gregg County, Texas, consisting Commission Agreed Order (Docket 97-0448-SIP)
414537200 of 815 acres more or less, and dated July 9, 1997. (s/d)
100% WI more particularly described in
87.50% NRI that certain Oil and Gas Lease AR-105265-000
dated October 15, 1930, recorded Purchase and Sale Agreement dated October 6,
A. A. King "D" (s) in Volume 61, Page 220, Deed 1995 by and between East Texas Gathering
414538100 Records, Gregg County, Texas. Company, Atlantic Richfield Company, Sun Pipe
100% WI 42-183-090518-000 Line Company and Sun Company, Inc. (s)
87.5% NRI (Surface Lease for .5 acres of land out of the Alex
A. A. King "B") Carmack Survey, Gregg County, AR-105265-001
Texas, as more particularly Crude Oil Buy/Sell Contract dated effective
described in that certain December 1, 1995 by and between ARCO Permian
unrecorded Surface Lease dated and Sun Company, Inc. (s)
February 1, 1989.
AR-23556
Oil Well Gas Contract dated July 3, 1962, by
and between The Atlantic Refining Company,
Seller and Sinclair Oil & Gas Company, Buyer
(s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- -------------------------- --------------------- ----------------------------------- -----------------------------------------------
East Texas Field 42-183-000042-001 A tract of land containing 127 AR-105265-000
A. A. King "C" (s) acres more or less out of Survey Purchase and Sale Agreement dated October 6,
414539900 known as No. 2 E. H. Angell S. 1995 by and between East Texas Gathering
100% WI F., Gregg County, Texas, and more Company, Atlantic Richfield Company, Sun Pipe
87.5% NRI particularly described by metes Line Company and Sun Company, Inc. (s)
and bounds in Oil and Gas Lease
dated October 15, 1930, A. A. AR-105265-001
King, et ux, Lessor, and J. R. Crude Oil Buy/Sell Contract dated effective
Stebbins, Lessee, recorded in December 1, 1995 by and between ARCO Permian
Volume 62, Page 63, Lease and Sun Company, Inc. (s)
Records, Gregg County, Texas.
AR-23556
Oil Well Gas Contract dated July 3, 1962, by
and between The Atlantic Refining Company,
Seller and Sinclair Oil & Gas Company, Buyer
(s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 2 of 165
<PAGE> 29
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004416-000 G. E. Adams, et ux Carl B. Everett 1-1-31 64 247
Adams (s) Mary Barton Adams
412025600
100% WI
87.5% NRI
White Oak Field
(Cotton Valley) (Surface Lease) G. E. Adams, et ux Atlantic Oil 7-13-36 ---- -----
P. C. Castleberry Gas Mary Barton Adams Producing Co.
Unit (d)
414681600
1.61169% ORRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000813-000 S. A. Cochran Argo Royalty Company 5-2-31 83 357
Alf Jones (187446,846) (Mineral Deed)
410702100
1.3761% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004416-000 A tract of land out of the Henry AR-95702
Adams (s) Hathaway Survey, Gregg County, Farmout Agreement dated February 13, 1990 by
412025600 Texas, and more particularly and between Atlantic Richfield Company, and C
100% WI described in that certain Oil and W Resources, Inc. (d)
87.5% NRI Gas Lease dated January 1, 1931,
recorded in Volume 64, Page 247, AR-95702-008
White Oak Field Gregg County, Texas. Declaration of Unitization and Designation of
(Cotton Valley) (Surface Lease) Gas Unit dated effective February 5, 1996 by
P. C. Castleberry Gas A tract of land containing 11.0 and between Atlantic Richfield Company and C
Unit (d) acres out of the Henry Hathaway W Resources, Inc. (d)
414681600 Survey, Gregg County, Texas, as
1.61169% ORRI more particularly described in Private Radio License from Federal
that certain unrecorded Surface Communications Commission to ARCO
Lease dated July 13, 1936. Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- --------------------------- --------------------- ----------------------------------- ---------------------------------------------
East Texas Field 42-183-000813-000 A tract of land out of the G. W. Oil and Gas Lease dated December 25, 1930,
Alf Jones (187446,846) (Mineral Deed) Hooper Survey A-92, Gregg County, recorded in Volume 64, Page 47, Deed Records,
410702100 Texas, containing 63.84 acres Gregg County, Texas.
1.3761% RI more or less, called 54.52 acres,
and more particularly described AR-105435-001
by metes and bounds in that Declaration of Unitization and Designation of
certain Mineral Deed dated May 2, Gas Unit dated effective November 1, 1995,
1931, recorded in Volume 83, Page between Wagner & Brown, et al and Madera
357, Deed Records, Gregg County, Production Company. (d)
Texas.
</TABLE>
Page 3 of 165
<PAGE> 30
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004034-000 Wm. Anderson et ux B. P. Seay 9-10-30 59 570
Anderson (Oryx) (s) Ella V. Anderson
412095701
50.0% WI
43.75% NRI
White Oak Field
(Cotton Valley)
W. M. Anderson (d)
410005100
6.25% ORRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
Willow Springs Field 42-183-007594-000 G. E. Fenton and B. A. Skipper 4-25-30 4 384
(Cotton Valley) wife, Pollick Fenton
Annie Fenton No. 1 (d)
435322600
2.12186% ORRI
Willow Springs Field
(Travis Peak West) 42-183-004947-000 J. R. Fenton, et ux B. A. Skipper 4-25-30 4 351
Annie Fenton Unit #1 Well
(d)
437025200
3.04889% ORRI BPO-Oil
2.84793% ORRI BPO-Gas
4.26844% ORRI APO-Oil
or
5.33555% WI APO-Oil and
4.66860% NRI APO-Oil
4.17467% ORRI APO-Gas
or
5.68720% WI APO-Gas and
4.9763% NRI APO-Gas
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004034-000 A tract of land out of the P. AR-105265-001
Anderson (Oryx) (s) McAnelly Survey A-267 and John Crude Oil Buy/Sell Contract dated effective
412095701 Ruddle Survey A-176, Gregg December 1, 1995 by and between ARCO Permian
50.0% WI County, Texas, being 83.27 acres and Sun Company, Inc. (s)
43.75% NRI more or less, but called 81 acres
more or less, and more AR-105265-000
White Oak Field particularly described in that Purchase and Sale Agreement dated October 6,
(Cotton Valley) certain Oil and Gas Lease dated 1995 by and between East Texas Gathering
W. M. Anderson (d) September 10, 1930, recorded in Company, Atlantic Richfield Company, Sun Pipe
410005100 Volume 59, Page 570, Deed Line Company and Sun Company, Inc. (s)
6.25% ORRI Records, Gregg County, Texas.
AR-105473
Farmout Agreement dated effective February 1,
1996 by and between Atlantic Richfield
Company, Wagner & Brown, Ltd., and C W
Resources, Inc. (d)
PD-2110
Joint Operating Agreement dated November 10,
1931 by and between Sun Oil Company and
Cranfill-Reynolds Company. (s/d)
AR-98412
Longview Gas Plant Gas Purchase Contract
dated January 1, 1997, by and between ARCO
Permian, seller and ARCO Permian, buyer, as
amended effective August 1, 1998 (s)
- --------------------------- --------------------- ----------------------------------- ----------------------------------------------
Willow Springs Field 42-183-007594-000 A tract of land out of the AR-101544
(Cotton Valley) Dolores Sanches Survey A-186, Farmout Agreement dated November 25, 1992
Annie Fenton No. 1 (d) Gregg County, Texas, and being between Atlantic Richfield Company and Cotton
435322600 more particularly described in Valley Productions, Inc. (d)
2.12186% ORRI that certain Oil and Gas Lease
dated April 25, 1930, recorded in AR-080830
Willow Springs Field Volume 4, Page 384, Deed Records, Farmout Agreement dated December 5, 1985,
(Travis Peak West) 42-183-004947-000 Gregg County, Texas. between Atlantic Richfield Company and Cotton
Annie Fenton Unit #1 Well Valley Productions, Inc. (d)
(d) A tract of land out of the
437025200 Delores Sanches Survey, Gregg AR-81381
3.04889% ORRI BPO-Oil County, Texas, containing 64 Longview Gas Plant Oil Well Gas Purchase
2.84793% ORRI BPO-Gas acres, being more particularly Contract dated July 24, 1996, by and between
4.26844% ORRI APO-Oil described in that certain Oil and ARCO Permian, seller and ARCO Permian, buyer,
or Gas Lease dated April 25, 1930, as amended effective August 13, 1998. (s)
5.33555% WI APO-Oil and recorded in Volume 4, Page 351,
4.66860% NRI APO-Oil Deed Records, Gregg County, Texas.
4.17467% ORRI APO-Gas
or
5.68720% WI APO-Gas and
4.9763% NRI APO-Gas
</TABLE>
Page 4 of 165
<PAGE> 31
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-183-004023-000 Allen Tooke, et ux, Ardis O. Phillips 10-7-30 4 501
(Cotton Valley) et al
ARCO Tooke (d)
410552400
12.5% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-183-004023-000 40 acres more or less out of the AR-105473
(Cotton Valley) Wakeland Survey, A-218, Gregg Farmout Agreement dated effective February 1,
ARCO Tooke (d) County, Texas, and being more 1996 by and between Atlantic Richfield
410552400 fully described in that certain Company, Wagner & Brown, Ltd., and C W
12.5% RI Oil and Gas Lease dated October Resources, Inc. (d)
7, 1930, recorded in Volume 4,
Page 501, Deed Records, Gregg AR-101621
County, Texas, insofar as lease Purchase and Sale Agreement dated effective
covers rights below the base of January 1, 1993, from Atlantic Richfield
the Woodbine Formation Company to Madera Production Company. (s)
AR-105265-000
Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
Company, Atlantic Richfield Company, Sun Pipe
Line Company and Sun Company, Inc. (s)
AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
</TABLE>
Page 5 of 165
<PAGE> 32
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-004950-000 Arthur Christian et B. A. Skipper 4-28-30 4 322
(Cotton Valley Sand) ux, Elizabeth, et al
J. D. Davis "E" Gas Unit
#5 (d)
410325401
0.247940% ORRI BPO
0.595055% WI APO
0.520673% NRI APO
J. D. Davis "E" Gas Unit
#4 (d)
410325400
0.247940% ORRI BPO
0.595055% WI APO
0.520673% NRI APO
Willow Springs Field
(Cotton Valley )
Davis Gas Unit "E" #2 and
#3 (d)
413452400
0.247940% ORRI BPO
0.595055% WI APO
0.520673% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-004950-000 31 acres out of the Henry AR-105832
(Cotton Valley Sand) Hathaway Survey, Gregg County, Partial Assignment of Operating Rights and
J. D. Davis "E" Gas Unit Texas, being the North 31 acres Bill of Sale dated effective February 1, 1998
#5 (d) of the South 62 acres of land between Atlantic Richfield Company, and Live
410325401 more particularly described in Oak Petroleum, Inc. (s)
0.247940% ORRI BPO that certain Oil and Gas Lease
0.595055% WI APO recorded in Volume 4, Page 322, AR-105265-001
0.520673% NRI APO Oil and Gas Lease Records, Gregg Crude Oil Buy/Sell Contract dated effective
County, Texas, only insofar as December 1, 1995 by and between ARCO Permian
J. D. Davis "E" Gas Unit lease covers rights below the and Sun Company, Inc. (s)
#4 (d) Base of the Woodbine formation
410325400 AR-104971
0.247940% ORRI BPO Unit Operating Agreement dated effective
0.595055% WI APO October 24, 1956, Oxy USA, Inc., Operator.
0.520673% NRI APO (d)
Willow Springs Field AR-104971-001
(Cotton Valley ) Declaration of Unitization of Gas Unit dated
Davis Gas Unit "E" #2 and June 18, 1958. (d)
#3 (d)
413452400 PD-3520
0.247940% ORRI BPO Contract of Purchase and Operating Agreement
0.595055% WI APO dated January 24, 1931, as amended August 11,
0.520673% NRI APO 1949 between the Atlantic Refining Company as
Operator and Magnolia Petroleum Company, et
al, as Non-Operators. (s)
AR-95702
Farmout Agreement dated February 13, 1990 by
and between Atlantic Richfield Company, and C
W Resources, Inc. (d)
</TABLE>
Page 6 of 165
<PAGE> 33
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003989-000 Joe Bander et ux, Exa J. K. Wadley 1-14-31 152 66
Bander (s) Bander
412205499
93.7656% WI
82.0491% NRI
Glenwood Field
(Cotton Valley)
T. W. Lee Gas Unit #1 (d)
415131300
9.10804% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003989-000 A part of the David Ferguson H. AR-95702
Bander (s) R. Survey, Gregg County, Texas, Farmout Agreement dated February 13, 1990 by
412205499 containing 85 acres more or less, and between Atlantic Richfield Company, and C
93.7656% WI and more particularly described W Resources, Inc. (d)
82.0491% NRI in that certain Oil & Gas Lease
dated January 14, 1931, recorded PD-2062
Glenwood Field Volume 152, Page 66, Deed Operating Agreement dated December 21, 1931
(Cotton Valley) Records, Gregg County, Texas. by and between Atlantic Oil Producing
T. W. Lee Gas Unit #1 (d) Company, Operator, and J. K. Wadley,
415131300 Non-Operator. (s/d)
9.10804% ORRI
AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-105265-000
Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
Company, Atlantic Richfield Company, Sun Pipe
Line Company and Sun Company, Inc. (s)
AR-105473
Farmout Agreement dated effective February 1,
1996 by and between Atlantic Richfield
Company, Wagner & Brown, Ltd., and C W
Resources, Inc. (d)
AR-94444
Purchase and Sale Agreement dated effective
October 1, 1991 by and between The Sinclair
Revocable Trust, The Fernald Point Production
Trust, and Atlantic Richfield Company. (s/d)
AR-81381
Longview Gas Plant Oil Well Gas Purchase
Contract dated July 24, 1996, by and between
ARCO Permian, seller and ARCO Permian, buyer,
as amended effective August 13, 1998. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 7 of 165
<PAGE> 34
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004035-000 R. C. Barnswell B. P. Seay 9-13-30 4 410
Barnswell B&C (s)
(Oryx)
412220801
50% WI
43.75% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004035-000 A tract of land out of the PD-2110
Barnswell B&C (s) McAnelly Survey, Gregg County, Joint Operating Agreement dated November 10,
(Oryx) Texas, and more particularly 1931 by and between Sun Oil Company and
412220801 described in that certain Oil and Cranfill-Reynolds Company. (s/d)
50% WI Gas Lease dated September 13,
43.75% NRI 1930 recorded in Volume 4, Page AR-98412
410, Deed Records, Gregg County, Longview Gas Plant Gas Purchase Contract
Texas. dated January 1, 1997, by and between ARCO
Permian, seller and ARCO Permian, buyer, as
amended effective August 1, 1998 (s)
AR-64468
Saltwater Disposal Agreement dated October 1,
1975 between ARCO Oil and Gas Company and
East Texas Salt Water Disposal Company. (s)
</TABLE>
Page 8 of 165
<PAGE> 35
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003979-000 W. T. Burnside, et al A. O. Phillips 9-19-30 4 493
Burnside "A" (s)
412640800
100% WI
87.5003% NRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000817-000 H. W. McKinley Argo Royalty Company 6-6-31 94 17
Clem Jones (465905) (Mineral Deed)
410703900
4.6875% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003979-000 166 acres more or less out of the AR-105265-001
Burnside "A" (s) H. R. Survey of Francis W. Crude Oil Buy/Sell Contract dated effective
412640800 Johnson, Gregg County, Texas, and December 1, 1995 by and between ARCO Permian
100% WI more particularly described by and Sun Company, Inc. (s)
87.5003% NRI metes and bounds in that certain
Assignment dated January 27, AR-105265-000
1933, from Rio Oil Corporation to Purchase and Sale Agreement dated October 6,
Atlantic Oil Producing Company, 1995 by and between East Texas Gathering
recorded in Book 141, Page 482, Company, Atlantic Richfield Company, Sun Pipe
Deed Records of Gregg County, Line Company and Sun Company, Inc. (s)
Texas
AR-98412
Longview Gas Plant Gas Purchase Contract
dated January 1, 1997, by and between ARCO
Permian, seller and ARCO Permian, buyer, as
amended effective August 1, 1998 (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000817-000 A tract of land out of the G. W. Oil and Gas Lease dated December 25, 1930,
Clem Jones (465905) (Mineral Deed) Hooper Survey, Gregg County, recorded in Volume 64, Page 45, Deed Records,
410703900 Texas, containing 65 acres, more Gregg County, Texas.
4.6875% RI or less, more particularly
described in that certain Mineral AR-105435-001
Deed dated June 6, 1931, recorded Declaration of Unitization and Designation of
in Volume 94, Page 17, Deed Gas Unit dated effective November 1, 1995,
Records, Gregg County, Texas. between Wagner & Brown, et al and Madera
Production Company
</TABLE>
Page 9 of 165
<PAGE> 36
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Willow Springs Field 42-183-003909-000 J. J. Fuller Mamie S. Hammonds 9-22-30 4 211
(Cotton Valley West)
Clemens Gas Unit #1
435321800
3.278776% ORRI
Willow Springs Field
(Cotton Valley West)
Clemens #3
414145800 42-183-004943-00A Dovie I. Collins, J. K. Wadley 1-19-31 78 26
3.278776% ORRI et vir
42-183-004943-00B Dovie I. Collins, J. K. Wadley 6-12-31 88 542
Guardian
42-183-004943-00C Dovie I. Collins, J. K. Wadley 1-24-31 Entry # 7678
Guardian
42-183-004941-000 J. E. Sheffield L. L. Edens 12-30-30 64 83
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Willow Springs Field 42-183-003909-000 A tract of land out of the M. A. AR-101543
(Cotton Valley West) Alexander H.R. and M. Irwin Farmout Agreement dated November 24, 1992 by
Clemens Gas Unit #1 Surveys, Gregg County, Texas, and between Atlantic Richfield Company and R.
435321800 containing 106.4 acres more or Byron Roach. (d)
3.278776% ORRI less, and more particularly
described in that certain Oil and AR-101664-001
Willow Springs Field Gas Lease dated September 22, Declaration of Gas Pooled Unit, R. Byron
(Cotton Valley West) 1930, recorded in Volume 4, Page Roach, Trustee, Clemens Cotton Valley Gas
Clemens #3 211, Deed Records, Gregg County, Unit No. 1 dated May 24, 1993, recorded in
414145800 Texas. Volume 2512, Page 381, Deed Records, Gregg
3.278776% ORRI County, Texas.
42-183-004943-00A Two tracts of land out of the
Dolores Sanchez Survey, Gregg PD-3519
County, Texas, containing 120 Contract of Purchase and Operating Agreement,
acres more or less, and more dated April 25, 1931 by and between J. K.
particularly described in that Wadley, et al, and Roeser & Pendleton, Inc.
certain Oil and Gas Lease dated
January 19, 1931, recorded in AR-81381
Volume 78, Page 26, Gregg County, Longview Gas Plant Oil Well Gas Purchase
Texas. Contract dated July 24, 1996, by and between
ARCO Permian, seller and ARCO Permian, buyer,
42-183-004943-00B Two tracts of land out of the as amended effective August 13, 1998. (s)
Dolores Sanchez Survey, Gregg
County, Texas, containing 120
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
June 12, 1931, recorded in Volume
88, Page 542, Gregg County, Texas.
42-183-004943-00C Two tracts of land out of the
Dolores Sanchez Survey, Gregg
County, Texas, containing 120
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
January 24, 1931, recorded in
Entry No. 7678, Deed Records,
Gregg County, Texas.
42-183-004941-000 A tract of land out of the
Dolores Sanchez Survey, Gregg
County, Texas, containing 50
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
December 30, 1930, recorded in
Volume 64, Page 83, Deed Records,
Gregg County, Texas.
</TABLE>
Page 10 of 165
<PAGE> 37
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Willow Springs Field 42-183-005874-000 R. R. Collins, et ux J. M. Wood 12-13-31 68 102
(Cotton Valley West)
Clemens Gas Unit #1
435321800
Willow Springs Field
(Cotton Valley West)
Clemens #3
414145800
(continued) 42-183-004415-000 J. J. Reppond, et ux D. H. Byrd 1-24-31 65 285
42-183-003987-00A C. C. Clemens, et al Max Kirk 5-15-31 Entry # 17309
42-183-003987-00B C. C. Clemens, Max Kirk 5-27-31 Entry # 17308
Guardian
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000820-000 H. H. Brooks Argo Royalty Company 1-23-45 286 427
Cole (650002, etc.) (Mineral Deed)
410506100
.1953% RI
East Texas Field
M. T. Cole
417163200
.1953% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Willow Springs Field 42-183-005874-000 A tract of land out of the
(Cotton Valley West) Dolores Sanchez Survey, Gregg
Clemens Gas Unit #1 County, Texas, containing 55
435321800 acres more or less, and more
particularly described in that
Willow Springs Field certain Oil and Gas Lease dated
(Cotton Valley West) December 13, 1931, recorded in
Clemens #3 Volume 68, Page 102, Deed
414145800 Records, Gregg County, Texas.
(continued)
42-183-004415-000 A tract of land out of the
Dolores Sanchez Survey, Gregg
County, Texas, containing 50
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
January 24, 1931, recorded in
Volume 65, Page 285, Deed
Records, Gregg County, Texas.
42-183-003987-00A A tract of land out of the
Dolores Sanchez Survey, Gregg
County, Texas, containing 63.96
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 15, 1931, recorded in Entry
No. 17309, Deed Records, Gregg
County, Texas.
42-183-003987-00B A tract of land out of the
Dolores Sanchez Survey, Gregg
County, Texas, containing 63.96
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 27, 1931, recorded in Entry
No. 17308, Deed Records, Gregg
County, Texas.
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000820-000 A tract of land out of the E. L.
Cole (650002, etc.) (Mineral Deed) Walker Survey containing 192
410506100 acres more or less in Gregg
.1953% RI County, Texas, and more
particularly described in that
East Texas Field certain Deed dated January 23,
M. T. Cole 1945, recorded in Volume 286,
417163200 Page 427, Deed Records, Gregg
.1953% RI County, Texas.
</TABLE>
Page 11 of 165
<PAGE> 38
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-004033-000 D. A. Porter, et ux W. F. Glenn 1-15-31 6 48
(Cotton Valley)
D. A. Porter Gas Unit (d)
410345900
8.197619% ORRI BPO
19.674285% WI APO
17.214999% NRI APO
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000034-000 C. H. Brown and Atlantic Oil 8-10-36 203 490
Dora Johnson (s/d) (Mineral Deed) Margaret Brown, his Producing Company
414415500 wife, et al
1.5 Net Acres
1.5 Gross Acres
Willow Springs Field
(Cotton Valley
T. B. Harris Gas Unit)
437459200
.000597% RI
3.180539% ORRI
7.63317% WI APO
6.67903% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-004033-000 A tract of land out of the G. W. AR-95702-006
(Cotton Valley) Hooper Survey, A-657, Upshur Declaration of Unitization and Designation of
D. A. Porter Gas Unit (d) County, Texas and G. W. Hooper Gas Unit effective June 16, 1994. (d)
410345900 Survey, A-92, Gregg County,
8.197619% ORRI BPO Texas, containing 109.33 acres AR-95702
19.674285% WI APO more or less, and more Farmout Agreement dated February 13, 1990 by
17.214999% NRI APO particularly described by metes and between Atlantic Richfield Company and C
and bounds in that certain Oil, W Resources, Inc. (d)
Gas and Mineral Lease dated
January 15, 1931, recorded in AR-101621
Volume 6, Page 48, Lease Records, Purchase and Sale Agreement dated effective
Upshur County, Texas. January 1, 1993, from Atlantic Richfield
Company to Madera Production Company. (s)
Only insofar as leases cover
rights below the Base of the
Woodbine formation.
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000034-000 1.5 acres more or less out of the Oil and Gas Lease dated effective November 1,
Dora Johnson (s/d) (Mineral Deed) G. W. Hooper Survey, A-92, Gregg 1995 between Atlantic Richfield Company and
414415500 County, Texas, and more Wagner & Brown, Ltd., as recorded in Volume
1.5 Net Acres particularly described by metes 3041, Page 31, Deed Records of Gregg County,
1.5 Gross Acres and bounds in Deed dated August Texas.
10, 1936 recorded in Volume 203,
Page 490, Deed Records, Gregg AR-105435-001
County, Texas. Declaration of Unitization dated effective
November 1, 1995, C W Resources, Inc.,
Willow Springs Field Operator. (d)
(Cotton Valley
T. B. Harris Gas Unit) T. B. Harris Gas Unit
437459200
.000597% RI
3.180539% ORRI
7.63317% WI APO
6.67903% NRI APO
</TABLE>
Page 12 of 165
<PAGE> 39
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003977-000 W. P. Duncan et ux Rio Oil Corporation 4-14-31 62 395
Duncan (s) Mary
413275100
100% WI
87.5% NRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-043544-000 E. G. Greene and Arctic Oil Company 2-9-31 125 629
wife, Mattie Greene
Elder Oil Unit #3 (s)
416021500
.6175% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003977-000 Being a part of the David AR-105265-000
Duncan (s) Ferguson Survey, Gregg County, Purchase and Sale Agreement dated October 6,
413275100 Texas, and more particularly 1995 by and between East Texas Gathering
100% WI described in Oil, Gas & Mineral Company, Atlantic Richfield Company, Sun Pipe
87.5% NRI Lease dated April 14, 1931, Line Company and Sun Company, Inc. (s)
recorded in Volume 62, Page 395
Deed Records, Gregg County, Texas. AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-81381
Longview Gas Plant Oil Well Gas Purchase
Contract dated July 24, 1996, by and between
ARCO Permian, seller and ARCO Permian, buyer,
as amended effective August 13, 1998. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-043544-000 Part of the Mary Van Winkle AR-101580
Survey A-208, Gregg County, Like-Kind Exchange Agreement dated June 1,
Elder Oil Unit #3 (s) Texas, and more particularly 1992 by and between Atlantic Richfield
416021500 described in that certain Oil and Company and Conoco, Inc. (s/d)
.6175% ORRI Gas Lease dated February 9,
1931, recorded in Volume 125, AR-101558
Page 629, Deed Records, Gregg Farmout Agreement dated April 23, 1992
County, Texas. between Conoco Inc. and R&C Petroleum, Inc.
(s/d)
Operating Agreement dated April 23, 1992 by
and between Conoco, Inc. and R&C Petroleum,
Inc. (s/d)
</TABLE>
Page 13 of 165
<PAGE> 40
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004017-00A S. C. Fishburn and Tom E. Cranfill and 4-9-31 79 299
Fishburn (s) wife, Fannette E. B. Germany
413495800 Fishburn
50% WI
43.75% NRI
White Oak Field
(Cotton Valley)
Fishburn #1 Gas Unit (d)
415689700
2.5832% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004017-00A A tract of land out of Block 5 of AR-98412
Fishburn (s) the Francis W. Johnson Survey, Longview Gas Plant Gas Purchase Contract
413495800 A-112, Gregg County Texas, and dated January 1, 1997, by and between ARCO
50% WI more particularly described in Permian, seller and ARCO Permian, buyer, as
43.75% NRI that certain Oil and Gas Lease amended effective August 1, 1998 (s)
dated April 9, 1931 from S. C.
White Oak Field Fishburn and wife, Fannette AR-104486-000
(Cotton Valley) Fishburn, recorded in Volume 79, Farmout Agreement dated October 19, 1993,
Fishburn #1 Gas Unit (d) Page 299, Deed Records, Gregg Gregg County, Texas, between Atlantic
415689700 County, Texas. Richfield Company and Reserve Management,
2.5832% ORRI Inc. (d)
AR-104486-001
Declaration of Unitization & Designation of
Gas Unit dated July 21, 1994 between Atlantic
Richfield Company and Reserve Management,
Inc. (d)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 14 of 165
<PAGE> 41
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003988-00A McBee Fisher Gaines B. Turner 10-28-19 39 600
Fisher (s)
413500800
100% WI
87.5% NRI
White Oak Field
(Cotton Valley) (d)
T. B. Harris Gas Unit #2 42-183-003988-00B Mrs. Juan Fisher, et J. F. Lucey 3-9-31 76 114
437459200 al
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #3 (d)
437459201
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #5 (d)
437459202
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #4 (d)
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003988-00A 130 acres out of the W. H. Texas Natural Resources Conservation
Fisher (s) Castleberry Survey, Gregg County, Commission Agreed Order (Docket 97-0448-SIP)
413500800 Texas, and more particularly dated July 9, 1997. (d)
100% WI described by metes and bounds in
87.5% NRI that certain Oil and Gas Lease AR-105265-000
dated October 28, 1919 recorded Purchase and Sale Agreement dated October 6,
White Oak Field in Volume 39, Page 600, Deed 1995 by and between East Texas Gathering
(Cotton Valley) (d) Records, Gregg County, Texas. Company, Atlantic Richfield Company, Sun
T. B. Harris Gas Unit #2 Pipe Line Company and Sun Company, Inc. (s)
437459200 42-183-003988-00B 130 acres out of the W. H.
.000597% RI Castleberry Survey, Gregg County, AR-105265-001
3.180539% ORRI BPO Texas, and more particularly Crude Oil Buy/Sell Contract dated effective
7.63317% WI APO described by metes and bounds in December 1, 1995 by and between ARCO Permian
6.67902% NRI APO that certain Oil & Gas Lease and Sun Company, Inc. (s)
dated March 9, 1931 recorded in
T. B. Harris Gas Unit #3 (d) Volume 76, Page 114, Deed AR-95702
437459201 Records, Gregg County, Texas. Farmout Agreement dated February 13, 1990 by
.000597% RI and between Atlantic Richfield Company, and C
3.180539% ORRI BPO W Resources, Inc. (d)
7.63317% WI APO
6.67902% NRI APO AR-98412
Longview Gas Plant Gas Purchase Contract
T. B. Harris Gas Unit #5 (d) dated January 1, 1997, by and between ARCO
437459202 Permian, seller and ARCO Permian, buyer, as
.000597% RI amended effective August 1, 1998 (s)
3.180539% ORRI BPO
7.63317% WI APO AR-18030-001
6.67902% NRI APO Declaration of Unit dated December 27, 1957,
C W Resources, Inc., Operator. (d)
T. B. Harris Gas Unit #4 (d)
.000597% RI Private Radio License from Federal
3.180539% ORRI BPO Communications Commission to ARCO
7.63317% WI APO Communications, Inc., dated December 16,
6.67902% NRI APO 1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 15 of 165
<PAGE> 42
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004008-000 H. L. Foster and G. S. Howard and M. 10-11-30 61 65
Foster "A" (s) wife, Florence Foster T. Flanagan
413555500
100% WI
87.5000% NRI
White Oak
(Cotton Valley Sand)
Allen Tooke Gas Unit #1
(d)
411005600
4.540623% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004008-000 A tract of land out of the W. G. AR-95702
Foster "A" (s) Painter Survey, Gregg County, Farmout Agreement dated February 13, 1990 by
413555500 Texas, and more particularly and between Atlantic Richfield Company, and C
100% WI described in that certain Oil and W Resources, Inc. (d)
87.5000% NRI Gas Lease dated October 11,
1930, recorded Volume 61, Page. AR-34291
White Oak 65, Deed Records, Gregg County, Crude Oil Marketing Internal Contract dated
(Cotton Valley Sand) Texas. December 1, 1995 by and between East Texas
Allen Tooke Gas Unit #1 Gathering Company, Atlantic Richfield Company
(d) and Sun Company, Inc. (s)
411005600
4.540623% ORRI AR-105265-000
Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
Company, Atlantic Richfield Company, Sun
Pipe Line Company and Sun Company, Inc. (s)
AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-57040
Salt Water Disposal Contract dated March 1,
1978, by and between Atlantic Richfield
Company and East Texas Salt Water Disposal
Company. (s)
AR-95702-007
Declaration of Unitization and Designation of
Gas Unit dated April 4, 1995, C W Resources,
Inc., Operator. (d)
AR-81381
Longview Gas Plant Oil Well Gas Purchase
Contract dated July 24, 1996, by and between
ARCO Permian, seller and ARCO Permian, buyer,
as amended effective August 13, 1998. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 16 of 165
<PAGE> 43
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004820-000 Henry L. Foster et ux J. M. Noble and E. 4-11-31 81 161
Foster "B" (s) Florence Foster E. Westervelt
413560100
100% WI
87.5% NRI
White Oak Field
(Cotton Valley Sand)
Allen Tooke Gas Unit #1 (d)
411005600
4.540623% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004820-000 A tract of land out of the W. G. AR-95702
Foster "B" (s) Painter Headright Survey, Gregg Farmout Agreement dated February 13, 1990 by
413560100 County, Texas, containing 7.8 and between Atlantic Richfield Company, and C
100% WI acres, and more particularly W Resources, Inc. (d)
87.5% NRI described in that certain Oil &
Gas Lease dated April 11, 1931, AR-105265-000
White Oak Field recorded in Volume 81, Page 161, Purchase and Sale Agreement dated October 6,
(Cotton Valley Sand) Deed Records, Gregg County, Texas. 1995 by and between East Texas Gathering
Allen Tooke Gas Unit #1 (d) Company, Atlantic Richfield Company, Sun Pipe
411005600 Line Company and Sun Company, Inc. (s)
4.540623% ORRI
AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-34291
Crude Oil Marketing Internal Contract dated
December 1, 1995, between East Texas
Gathering Company, Atlantic Richfield Company
and Sun Company, Inc. (s)
Texas Natural Resources Conservation
Commission Agreed Order (Docket No.
97-0448-SIP) dated July 9, 1997. (s/d)
AR-95702-007
Declaration of Unitization and Designation of
Gas Unit dated April 4, 1995, C W Resources,
Inc., Operator. (d)
AR-81381
Longview Gas Plant Oil Well Gas Purchase
Contract dated July 24, 1996, by and between
ARCO Permian, seller and ARCO Permian, buyer,
as amended effective August 13, 1998. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 17 of 165
<PAGE> 44
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-043538-000 Mrs. Trip Elder, a Joe Blalack 5-18-55 458 457
Frank and J S Elder Oil widow, et al
Unit
416024000
0.02707% ORRI
0.03093% RI
Mrs. Camie Elder, a Joe Blalack 5-18-55 458 462
widow, et al
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-043547-000 G. B. Tennery and B.A. Skipper 5-22-30 4 336
G. B. Tennery (s) wife Anna Tennery
419501900
83.10% WI
72.7125% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-043538-000 A tract of land out of the Wm. J. AR-101580
Frank and J S Elder Oil McCurry Survey and a tract of Like-Kind Exchange Agreement dated June 1,
Unit land out of the G. H. Tutt 1992 by and between Atlantic Richfield
416024000 Survey, all in Gregg County, Company and Conoco, Inc. (s/d)
0.02707% ORRI Texas, and more particularly
0.03093% RI described in that certain Oil and
Gas Lease dated May 18, 1955,
recorded in Volume 458, Page 457,
Deed Records, Gregg County, Texas.
A tract of land out of the Wm. J.
McCurry Survey and a tract of
land out of the G. H. Tutt
Survey, all in Gregg County,
Texas, and more particularly
described in that certain Oil and
Gas Lease dated May 18, 1955,
recorded in Volume 458, Page 462,
Deed Records Gregg County, Texas.
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-043547-000 A tract of land being a part of AR-101547
G. B. Tennery (s) the William Robinson Survey Purchase and Sale Agreement dated November
419501900 A-177, Gregg County, Texas, and 15, 1982 by and between Conoco, Inc. and
83.10% WI more particularly described in Petro-Lewis Corporation. (s/d)
72.7125% NRI that certain Oil & Gas Lease
dated May 22, 1930, recorded AR-101548
Volume 4, Page 336, Deed Records, Joint Operating Agreement dated January 1,
Gregg County, Texas. 1983 by and between Conoco, Inc. and
Petro-Lewis Corporation. (s/d)
AR-101580
Like-Kind Exchange Agreement dated June 1,
1992 by and between Atlantic Richfield
Company and Conoco, Inc. (s/d)
AR-104933
Declaration of Pooling and Designation of
Unit P. D. Harrison "E-1" Gas Unit, Gregg
County, Texas, dated May 2, 1984 between
Cities Service Oil and Gas Corporation and
Amoco Production Company. (d)
Subject to unnumbered Contract dated April
16, 1959 between Continental Oil Company
(Seller) and the Arkansas Fuel Oil
Corporation (Buyer).
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 18 of 165
<PAGE> 45
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000814-000 G. W. Richey et ux Argo Royalty Company 7-1-38 233 130
G. W. Richey (Mineral Deed) Ida Richey
(4007262, 263 & 264) (s)
410863900
.7813% RI
Richey, G. W. (468402)
(R) (s)
410862100
.7813% RI
East Texas Field
G. W. Richey SND
412689100
.78125% RI
GladeWater Field
(Haynesville)
G. W. Richey 1-H (d)
412525800
.1738227% RI
Glenwood Field
(Cotton Valley)
G. W. Richey Gas Unit #2 (d)
410689000
.1738227% RI
Glenwood Field
(Cotton Valley)
J. W. Orr Gas Unit
414143100
.26869% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-043541-000 H. P. Hale, et ux D. H. Byrd 11-19-30 61 645
H. P. Hale
416025800
.7031% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000814-000 Two tracts of land out of the Oil and Gas Lease dated December 31, 1930,
G. W. Richey (Mineral Deed) Lewis Rigsby H. R. Survey and one recorded in Volume 67, Page 1167, Deed
(4007262, 263 & 264) (s) tract of land out of the Wm. Records, Gregg County, Texas.
410863900 Carleton H. R. Survey, Gregg
.7813% RI County, Texas, and more
particularly described in that
Richey, G. W. (468402) certain instrument dated July 1,
(R) (s) 1938, recorded in Volume 233,
410862100 Page 130, Deed Records, Gregg
.7813% RI County, Texas.
East Texas Field
G. W. Richey SND
412689100
.78125% RI
GladeWater Field
(Haynesville)
G. W. Richey 1-H (d)
412525800
.1738227% RI
Glenwood Field
(Cotton Valley)
G. W. Richey Gas Unit #2 (d)
410689000
.1738227% RI
Glenwood Field
(Cotton Valley)
J. W. Orr Gas Unit
414143100
.26869% RI
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-043541-000 A tract of land out of the John AR-101580
H. P. Hale Wilkinson Survey A-224, Gregg Like-Kind Exchange Agreement dated June 1,
416025800 County, Texas, containing 95.50 1992 by and between Atlantic Richfield
.7031% ORRI acres more or less, and more Company and Conoco, Inc. (s/d)
particularly described in that
certain Oil, Gas and Mineral AR-101550
Lease dated November 19, 1930, Operating Agreement dated September 1, 1964,
recorded Volume 61, Page 645, Conoco, Inc., Operator
Deed Records, Gregg County,
Texas.
</TABLE>
Page 19 of 165
<PAGE> 46
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-043539-000-001 Buck Harris Gaines B. Turner, 10-28-19 39 607
Harris (Conoco) 62.5% (s) Trustee
419499300
51.9375% WI
45.4453% NRI
East Texas Field
Harris (Conoco) 37.5% (s)
419499301
51.9375% WI
45.4453% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-043539-000-001 A tract of land out of the Wm. AR-105265-001
Harris (Conoco) 62.5% (s) Castleberry Survey, A-38, Gregg Crude Oil Buy/Sell Contract dated effective
419499300 County, Texas, containing 80.0 December 1, 1995 by and between ARCO Permian
51.9375% WI acres more or less, and more and Sun Company, Inc. (s)
45.4453% NRI particularly described in that
certain Oil and Gas Lease dated AR-105265-000
East Texas Field October 28, 1919, recorded in Purchase and Sale Agreement dated October 6,
Harris (Conoco) 37.5% (s) Volume 39, Page 607, Deed 1995 by and between East Texas Gathering
419499301 Records, Gregg County, Texas. Company, Atlantic Richfield Company, Sun Pipe
51.9375% WI Line Company and Sun Company, Inc. (s)
45.4453% NRI
AR-101580
Like-Kind Exchange Agreement dated June 1,
1992 between Conoco Inc. and Atlantic
Richfield Company. (s/d)
AR-101555
Operating Agreement dated January 1, 1959,
wherein Pan American Petroleum Corporation is
Operator.
AR-101554
Operating Agreement dated May 4, 1931,
wherein Conoco Inc. is Operator.
AR-101550
Operating Agreement dated September 1, 1964
wherein Conoco Inc. is Operator. (s)
Subject to unnumbered Contract dated April
16, 1959 between Continental Oil Company
(Seller) and the Arkansas Fuel Oil
Corporation (Buyer).
Declaration of Unit dated February 20, 1959,
Gregg County, Texas (Bob Wood Gas Unit) (d)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 20 of 165
<PAGE> 47
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003982-000 Martin Hays, et ux B. F. Seay 9-11-30 4 412
Hays A & B (s)
414060500
78.3510% WI
68.5571% NRI
42-183-09003-000 Robert Cargill, Sr., Atlantic Refining 11-11-64 663 469
et al Company and Sun Oil
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003982-000 All of the W. C. Alvice H. R. Texas Natural Resource Conservation
Hays A & B (s) Survey, No. 11, Gregg County, Commission Agreed Order dated July 9, 1997
414060500 Texas, containing 548 acres of (Docket No. 97-0448SIP) (s/d)
78.3510% WI land more or less, and being more
68.5571% NRI particularly described in Oil & AR-052768
Gas Lease dated September 11, Saltwater Disposal Agreement between East
1930, and recorded in Volume 4, Texas Salt Water Disposal Company and
Page 412, Deed Records Gregg Atlantic Richfield Company dated October 1,
County, Texas 1975. (s/d)
42-183-09003-000 451.58 acres, more or less, being PD-2004
all of the land described therein Joint Operating Agreement dated September 28,
Save and Except the W/2 of S/200 1931, by and between Sun Oil Company and
acres of Alvice Survey from the Atlantic Oil Producing Company (s)
surface to 3,655 feet, as more
particularly described in that PD-2417
certain Surface Lease dated Operating Agreement dated May 1, 1940,
November 11, 1964, recorded in between Stanolind Oil & Gas Co. and Atlantic
Volume 663, Page 469, Deed Refining Co. and Sun Oil Co. (s)
Records, Gregg County, Texas.
AR-000675
Boundary Agreement between The Atlantic
Refining Company, Stanolind Oil & Gas
Company, and Sun Oil Company, dated June 24,
1937. (s)
AR-98412
Longview Gas Plant Gas Purchase Contract
dated January 1, 1997, by and between ARCO
Permian, Seller and ARCO Permian, Buyer, as
amended effective August 1, 1998
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 21 of 165
<PAGE> 48
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004949-000 Mrs. Pet Hopkins et B. A. Skipper 5-20-30 4 328
Hopkins (s) vir John T. Hopkins
414245400
50% WI
43.7513% NRI
White Oak Field
(Cotton Valley)
Pet Hopkins Gas Unit (d)
437459203
.000016% RI
1.652946% ORRI BPO
3.967071% WI APO
3.471188% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004949-000 173 acres out of the W. H. AR-105265-000
Hopkins (s) Castleberry HR Survey, and more Purchase and Sale Agreement dated October 6,
414245400 particularly described by metes 1995 by and between East Texas Gathering
50% WI and bounds in that certain Oil Company, Atlantic Richfield Company, Sun Pipe
43.7513% NRI and Gas Lease dated May 20,1930, Line Company and Sun Company, Inc. (s)
recorded in Volume 4, Page 328,
White Oak Field Deed Records, Gregg County, Texas. AR-105265-001
(Cotton Valley) Crude Oil Buy/Sell Contract dated effective
Pet Hopkins Gas Unit (d) December 1, 1995 by and between ARCO Permian
437459203 and Sun Company, Inc. (s)
.000016% RI
1.652946% ORRI BPO AR-95702-005
3.967071% WI APO Declaration of Unitization and Designation of
3.471188% NRI APO Gas Unit dated July 16, 1993, C W Resources,
Inc., Operator. (d)
AR-95702
Farmout Agreement dated February 13, 1990 by
and between Atlantic Richfield Company, and C
W Resources, Inc. (d)
AR-7967
Casinghead Gas Contract dated June 6, 1950,
by and between the Atlantic Refining Company,
et al and Arkansas Fuel Oil Company, as
amended on November 11, 1963 and March 16,
1979. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 22 of 165
<PAGE> 49
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003975-00B M. B. Hughes, et ux Bert Kouns 10-15-30 62 51
Hughey "A" Well #5 (s) Annie Hughes
414275600
100% WI
87.5049% NRI
42-183-003975-00A
Hughey "A" (Except #5) (s)
414270500
77.50% WI
67.8174% NRI
Hughey B&C (s) 42-183-004417-000
414280200
100% WI
87.5014% NRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-043543-000 J. R. Watson, et ux D. H. Byrd 12-29-30 70 32
J. R. Watson (s) Sue Juanita Watson
416023100
1.5625% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003975-00B Two tracts of land, being one 204 AR-101580
Hughey "A" Well #5 (s) acre tract out of the L. B. Like-Kind Exchange Agreement dated June 1,
414275600 Outlaw Headright Survey and one 1992 by and between Atlantic Richfield
100% WI 80 acre tract out of the William Company and Conoco, Inc. (s/d)
87.5049% NRI McCurry Headright Survey for a
42-183-003975-00A total of 284 acres, and more AR-98412
Hughey "A" (Except #5) (s) fully described by metes and Longview Gas Plant Gas Purchase Contract
414270500 bounds in that certain Oil, Gas & dated January 1, 1997, by and between ARCO
77.50% WI Mineral Lease dated October 15, Permian, seller and ARCO Permian, buyer, as
67.8174% NRI 1930, recorded in Volume 62, Page amended effective August 1, 1998 (s)
51, Deed Records, Gregg County,
Hughey B&C (s) 42-183-004417-000 Texas. AR-52769
414280200 Service Contract for Disposal of Salt Water
100% WI dated October 1, 1975, by and between
87.5014% NRI Atlantic Richfield Company and East Texas
Salt Water Disposal Company. (s)
PD-1957
Joint Operating Agreement dated June 3, 1931
by and between Byrd-Frost, Inc. and Atlantic
Richfield Oil Producing Company. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-043543-000 15 acres out of the John S. AR-101580
J. R. Watson (s) Caruthers Survey, A-40, Gregg Like-Kind Exchange Agreement dated June 1,
416023100 County, Texas, described in Oil 1992 by and between Atlantic Richfield
1.5625% ORRI and Gas Lease dated December 29, Company and Conoco, Inc. (s/d)
1930, recorded in Volume 70, Page
32, Deed Records, Gregg County, AR-101547
Texas. Purchase and Sale Agreement dated November
15, 1982 by and between Conoco, Inc. and
Petro-Lewis Corporation. (s/d)
Joint Operating Agreement dated January 1,
1983 by and between Conoco, Inc. and
Petro-Lewis Corporation. (s/d)
AR-101555
Operating Agreement dated January 1, 1959 by
and between Pan-American Petroleum
Corporation and Arkansas Fuel Oil
Corporation. (s/d)
</TABLE>
Page 23 of 165
<PAGE> 50
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Gladewater Field 42-183-000815-000 J. D. Pollard Argo Royalty Company 5-19-31 88 261
(Haynesville) (Mineral Deed)
J. T. Jeter Estate Gas Unit
Well #1 (d)
413101100
.395682% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000035-001 J. W. Akin, et ux H. J. Wilder 10-10-30 4 562
J. W. Akin "A" (s) Nellie Akin
412050700
100% WI
87.5% NRI
J. W. Akin "A" (RI)
412053100
.00004% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000012-001 J. W. Akin et ux, O. M. Boren and L. 10-5-30 61 432
J. W. Akin "B" (s) Nellie Akin A. Grelling, Jr.
412051500
100% WI
87.5001% NRI
White Oak Field
(Cotton Valley) (d)
J. W. Akin Gas Unit #1
414142300
5.2948% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Gladewater Field 42-183-000815-000 A tract of land out of the H. R. Oil and Gas Lease dated January 1, 1988,
(Haynesville) (Mineral Deed) Hockit Survey, A-95, Gregg recorded by Memorandum of Oil and Gas Lease
J. T. Jeter Estate Gas Unit County, Texas, containing 37 in Volume 1941, Page 140, Official Public
Well #1 (d) acres more or less, and more Records, Gregg County, Texas.
413101100 particularly described in that
.395682% RI certain Mineral Deed dated May
19, 1931, recorded in Volume 88,
Page 261, Deed Records, Gregg
County, Texas.
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000035-001 A tract of land out of the Wm. H. Texas Natural Resources Conservation
J. W. Akin "A" (s) Castleberry Survey, Gregg County, Commission Agreed Order (Docket 97-0448-SIP)
412050700 Texas, containing 96.0 acres more dated July 9, 1997. (s/d)
100% WI or less, and more particularly
87.5% NRI described by metes and bounds in AR-23556
that certain Oil and Gas Lease Oil Well Gas Contract dated July 3, 1962, by
J. W. Akin "A" (RI) dated October 10, 1930, recorded and between The Atlantic Refining Company,
412053100 in Volume 4, Page 562, Deed Seller and Sinclair Oil & Gas Company, Buyer
.00004% RI Records, Gregg County, Texas (s), amended February 20, 1991
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000012-001 A tract of land out of the W. H. Texas Natural Resources Conservation
J. W. Akin "B" (s) Castleberry Survey, Gregg County, Commission Agreed Order (Docket No.
412051500 Texas, containing the South 200 97-0448-SIP) dated July 9, 1997. (s/d)
100% WI acres more or less, and more
87.5001% NRI particularly described by metes AR-95702
and bounds in Oil and Gas Lease Farmout Agreement dated February 13, 1990 by
White Oak Field dated October 5, 1930, recorded and between Atlantic Richfield Company, and C
(Cotton Valley) (d) in Volume 61, Page 432, Deed W Resources, Inc. (d)
J. W. Akin Gas Unit #1 Records, Gregg County, Texas
414142300 AR-95702-009
5.2948% ORRI Declaration of Unitization and Designation of
Gas Unit dated effective July 10, 1996 by and
between Atlantic Richfield Company and C W
Resources, Inc. (d)
AR-23556
Oil Well Gas Contract dated July 3, 1962, by
and between The Atlantic Refining Company,
Seller and Sinclair Oil & Gas Company, Buyer
(s), amended February 20, 1991
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 24 of 165
<PAGE> 51
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000818-000 John T. O'Neil Argo Royalty Company 3-19-32 123 20
Jettie Barnes (616,650318) (Mineral Deed)
(s)
410427700
1.56250% RI
White Oak Field
(Cotton Valley Sand)
J. M. Christian Gas Unit #1
(d)
400060900
1.56250% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000048-001 John R. Williams, et W. H. Winn 9-19-30 61 326
John R. Williams (s) ux
416830500
100% WI
.025% RI
87.500% NRI
White Oak Field
(Cotton Valley)
J. R. Williams Gas Unit
#1(d)
415698600
4.17407% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000818-000 A tract of land out of the G. W. Oil and Gas Lease dated January 2, 1931,
Jettie Barnes (616,650318) (Mineral Deed) Hooper Survey, Gregg County, recorded in Volume 95, Page 290, Deed
(s) Texas, containing 30.0 acres more Records, Gregg County, Texas.
410427700 or less, and more particularly
1.56250% RI described in that certain Oil and
Gas Lease dated March 19, 1932,
White Oak Field recorded in Volume 123, Page 20,
(Cotton Valley Sand) Deed Records, Gregg County, Texas.
J. M. Christian Gas Unit #1
(d)
400060900
1.56250% RI
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000048-001 A tract of land out of the John AR-105473-001
John R. Williams (s) Ruddle and W. L. Wilborne Designation of Unit for the J. R. Williams
416830500 Surveys, Gregg County, Texas, Gas Unit No. 1, dated effective May 5, 1997
100% WI containing 81.2 acres more or by C W Resources, et al. (d)
.025% RI less, and more particularly
87.500% NRI described in that certain Oil, AR-105473
Gas and Mineral Lease dated Farmout Agreement dated effective February 1,
September 19, 1930, recorded in 1996 by and between Atlantic Richfield
White Oak Field Volume 61, Page 326, Deed Company, Wagner & Brown, Ltd., and C W
(Cotton Valley) Records, Gregg County, Texas. Resources, Inc. (d)
J. R. Williams Gas Unit
#1(d) AR-105265-001
415698600 Crude Oil Buy/Sell Contract dated effective
4.17407% ORRI December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-105265-000
Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
Company, Atlantic Richfield Company, Sun Pipe
Line Company and Sun Company, Inc. (s)
AR-23556
Oil Well Gas Contract dated July 3, 1962, by
and between The Atlantic Refining Company,
Seller and Sinclair Oil & Gas Company, Buyer
(s), amended February 20, 1991
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 25 of 165
<PAGE> 52
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000031-001 Mary Lawson, et al W. H. Winn 9-22-30 62 398
Mary Lawson (s)
414700600
100% WI
87.5% NRI
42-183-000031-002 Mamie Henderson, et J. C. Davis 3-14-31 78 104
vir
42-183-000031-003 Mary Lawson, as Sinclair Oil & Gas 6-22-31 96 85
Guardian of Juanita Company
Lawson, et al
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000031-001 A tract of land out of the AR-105265-000
Mary Lawson (s) Pleasant McAnelly Survey, Gregg Purchase and Sale Agreement dated October 6,
414700600 County, Texas, containing 86.75 1995 by and between East Texas Gathering
100% WI acres more or less, and more Company, Atlantic Richfield Company, Sun Pipe
87.5% NRI particularly described in that Line Company and Sun Company, Inc. (s)
certain Oil and Gas Lease dated
September 22, 1930, recorded in AR-105265-001
Volume 62, Page 398, Deed Crude Oil Buy/Sell Contract dated effective
Records, Gregg County, Texas. December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
42-183-000031-002 A tract of land out of the
Pleasant McAnelly Survey, Gregg AR-23556
County, Texas, containing 86.75 Oil Well Gas Contract dated July 3, 1962, by
acres more or less, and more and between The Atlantic Refining Company,
particularly described in that Seller and Sinclair Oil & Gas Company, Buyer
certain Oil and Gas Lease dated (s), amended February 20, 1991
March 14, 1931, recorded in
Volume 78, Page 104, Deed Private Radio License from Federal
Records, Gregg County, Texas. Communications Commission to ARCO
Communications, Inc., dated December 16,
42-183-000031-003 A tract of land out of the 1992, File No. 0000000319451, Call Sign
Pleasant McAnelly Survey, Gregg KNEP883, Frequency 154.47875 MHZ
County, Texas, containing 86.75
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
June 22, 1931, recorded in Volume
96, Page 85 of Deed Records of
Gregg County, Texas.
</TABLE>
Page 26 of 165
<PAGE> 53
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000044-001 Mattie Moncrief, et al M. C. Sells 10-13-30 61 223
Mattie Moncrief (s)
415270100
100% WI
87.5% NRI
White Oak Field
(Cotton Valley)
Mattie Moncrief #1 (d)
411129000 42-183-000044-002 Mattie Moncrief, Sinclair Oil 4-23-31 83 259
12.5% ORRI Guardian Corporation
White Oak Field
(Cotton Valley)
J. C. Persons #1A (d)
437451701
1.085823% ORRI BPO
2.605976% WI APO
2.280229% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000044-001 A tract of land out of the AR-95702
Mattie Moncrief (s) William H. Castleberry Survey, Farmout Agreement dated February 13, 1990 by
415270100 Gregg County, Texas, containing and between Atlantic Richfield Company, and C
100% WI 307.5 acres more or less, and W Resources, Inc. (d)
87.5% NRI more particularly described in
that certain Oil and Gas Lease AR-105265-000
White Oak Field dated October 13, 1930, recorded Purchase and Sale Agreement dated October 6,
(Cotton Valley) in Volume 61, Page 223, Deed 1995 by and between East Texas Gathering
Mattie Moncrief #1 (d) Records, Gregg County, Texas. Company, Atlantic Richfield Company, Sun Pipe
411129000 Line Company and Sun Company, Inc. (s)
12.5% ORRI 42-183-000044-002 A tract of land out of the
William H. Castleberry Survey, AR-105265-001
White Oak Field Gregg County, Texas, containing Crude Oil Buy/Sell Contract dated effective
(Cotton Valley) 307.5 acres more or less, and December 1, 1995 by and between ARCO Permian
J. C. Persons #1A (d) more particularly described in and Sun Company, Inc. (s)
437451701 that certain Oil and Gas Lease
1.085823% ORRI BPO dated April 23, 1931, recorded in AR-64597
2.605976% WI APO Volume 83, Page 259, Deed Salt Water Disposal Agreement dated June 28,
2.280229% NRI APO Records, Gregg County, Texas. 1982, by and between ARCO Oil and Gas Company
and East Texas Salt Water Disposal Company.
(s)
AR-95702-002
Declaration of Unitization and Designation of
Gas Unit forming the J. C. Persons Gas Unit,
dated June 19, 1992. (d)
AR-23556
Oil Well Gas Contract dated July 3, 1962, by
and between The Atlantic Refining Company,
Seller and Sinclair Oil & Gas Company, Buyer
(s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 27 of 165
<PAGE> 54
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004044-000 Percy McGeorge Cranfill and Germany 1-5-31 68 174
McGeorge (s)
415095300
100% WI
87.5% NRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000278-000 J. S. Smith Higgins Oil & Fuel 2-18-31 90 73
Nat Bean "A" & "B" (Mineral Deed) Company
417060100
.7813% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004044-000 A tract of land out of the AR-64597
McGeorge (s) Pleasant McAnelly Survey, Gregg Salt Water Disposal Agreement dated June 28,
415095300 County, Texas, containing 40.0 1982, by and between ARCO Oil and Gas Company
100% WI acres more or less, and more and East Texas Salt Water Disposal Company.
87.5% NRI particularly described in that (s)
certain Oil and Gas Lease dated
January 5, 1931, recorded in AR-98412
Volume 68, Page 174, Deed Longview Gas Plant Gas Purchase Contract
Records, Gregg County, Texas. dated January 1, 1997, by and between ARCO
Permian, seller and ARCO Permian, buyer, as
amended effective August 1, 1998 (s)
AR-105265-000
Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
Company, Atlantic Richfield Company, Sun Pipe
Line Company and Sun Company, Inc. (s)
AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000278-000 A tract of land out of Tipton R.
Nat Bean "A" & "B" (Mineral Deed) Bean & Mary Ann Bean tracts on
417060100 the Mary Van Winkle, W. P.
.7813% RI Chisum, Isaac Ruddle and Jacob
Lewis Surveys, Gregg and Rusk
Counties, Texas, and more
particularly described in that
certain Mineral Deed dated
February 18, 1931, recorded in
Volume 90, Page 73, Deed Records,
Gregg County, Texas
</TABLE>
Page 28 of 165
<PAGE> 55
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-004018-000 P. C. Castleberry, et B. A. Skipper 9-12-30 4 362
(Cotton Valley) ux
P. C. Castleberry Gas Unit
(d)
414681600
1.61169% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-004018-000 A tract of land out of the G. W. AR-95702-008
(Cotton Valley) Hooper Survey, Gregg County, Declaration of Unitization and Designation of
P. C. Castleberry Gas Unit Texas, containing 37.8 acres more the Gas Unit, dated effective February 5,
(d) or less, and more particularly 1996, by and between Atlantic Richfield
414681600 described by metes and bounds in Company and C W Resources, Inc. (d)
1.61169% ORRI that certain Oil, Gas and Mineral
Lease dated September 12, 1930, AR-95702
recorded in Volume 4, Page 362, Farmout Agreement dated February 13, 1990 by
Deed Records, Gregg County, Texas. and between Atlantic Richfield Company and C
W Resources, Inc. (d)
Only insofar as rights are
limited to below the Woodbind AR-101621
formation. Purchase and Sale Agreement effective January
1, 1993 by and between Atlantic Richfield
Company and Madera Production Company.
</TABLE>
Page 29 of 165
<PAGE> 56
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-005882-000 R. A. Penn, et ux A. T. Smith 12-14-37 225 353
Penn (s)
415610200
50.00% WI
43.75% NRI
White Oak Field
(Cotton Valley)
T. B. Harris Gas Unit #2
(d)
437459200
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #3 (d)
437459201
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #5 (d)
437459202
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #4 (d)
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-005882-000 A tract of land out of the AR-000753
Penn (s) William Robinson Survey, Gregg Joint Operating Agreement dated March 21,
415610200 County, Texas, more particularly 1938 by and between the Atlantic Refining
50.00% WI described in that certain Oil and Company and J. K. Wadley, et al.
43.75% NRI Gas Lease dated December 14,
1937, recorded in Volume 225, AR-95702
Page 353, Deed Records, Gregg Farmout Agreement dated February 13, 1990 by
White Oak Field County, Texas. and between Atlantic Richfield Company, and C
(Cotton Valley) W Resources, Inc. (d)
T. B. Harris Gas Unit #2
(d) AR-018030-001
437459200 Declaration Unit dated December 27, 1957, C W
.000597% RI Resources, Inc., Operator. (d)
3.180539% ORRI BPO
7.63317% WI APO AR-18030-000
6.67902% NRI APO Joint Operating Agreement dated May 14, 1957
by and between Atlantic Refining Company,
T. B. Harris Gas Unit #3 (d) Operator, and Humble Oil and Refining
437459201 Company, et al, Non-Operator. (d)
.000597% RI
3.180539% ORRI BPO AR-7566
7.63317% WI APO Casinghead Gas Contract dated June 9, 1950,
6.67902% NRI APO by and between The Atlantic Refining Company
(ARCO Oil & Gas), Susie L. Wadley and J. K.
T. B. Harris Gas Unit #5 (d) Wadley, Seller, and Arkansas Fuel Oil Company
437459202 (Trident NGL, Inc.), Buyer.
.000597% RI
3.180539% ORRI BPO Private Radio License from Federal
7.63317% WI APO Communications Commission to ARCO
6.67902% NRI APO Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
T. B. Harris Gas Unit #4 (d) KNEP883, Frequency 154.47875 MHZ
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
</TABLE>
Page 30 of 165
<PAGE> 57
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004948-000 Bun E. Rodden, et al W. A. Moncrief 9-16-30 60 207
Rodden (s)
415890300
50% WI
43.7504% NRI
Willow Springs Field
Cotton Valley
Lathrop Gas Unit
417898000
2.26152% WI
1.97883% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004948-000 A tract of land out of the AR-94444
Rodden (s) William Robinson Survey, A-177, Purchase and Sale Agreement dated effective
415890300 Gregg County, Texas, and more October 1, 1991 by and between The Sinclair
50% WI particularly described in that Revocable Trust, The Fernald Point Production
43.7504% NRI certain Oil and Gas Lease dated Trust and Atlantic Richfield Company. (s)
September 16, 1930, recorded in
Willow Springs Field Volume 60, Page 207, Deed Texas Natural Resources Conservation
Cotton Valley Records, Gregg County, Texas. Commission Agreed Order dated September 9,
Lathrop Gas Unit 1997. (Docket 97-0448-SIP) (s/d)
417898000
2.26152% WI AR-7967
1.97883% NRI Casinghead Gas Contract dated June 6, 1950,
by and between the Atlantic Refining Company,
et al and Arkansas Fuel Oil Company, as
amended on November 11, 1963 and March 16,
1979. (s)
PD-3520
Operating Contract dated January 24, 1931
between Frank R. Foster, Roeser & Pendleton,
Inc. and Freeman Burford. (s/d)
AR-13913
Operating Agreement dated September 20, 1955,
between Stanolind Oil & Gas Company and
Arkansas Fuel Oil Corporation, et al. (d)
Declaration of Unitization dated September
20, 1955 between Stanolind Oil and Gas
Company and Atlantic Refining Company, et al,
covering the F. K. Lathrop Gas Unit,
consisting of 699.53 acres. (d)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 31 of 165
<PAGE> 58
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000040-001 S. G. Andrews et ux J. R. Stebbins 10-15-30 62 62
S. G. Andrews (s) Myrtle Andrews
412110400
100% WI
87.5% NRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-004951-000 S. G. Smith, et ux B. A. Skipper 5-6-30 4 330
S. G. Smith (s)
416245500
50.00% WI
43.75% NRI
White Oak Field
(Cotton Valley)
T. B. Harris Gas Unit #2 (d)
437459200
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #3 (d)
437459201
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #5 (d)
437459202
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #4 (d)
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000040-001 A tract of land out of the J. G. AR-64596
S. G. Andrews (s) Walker Survey, A-215, Gregg Saltwater Disposal Contract dated June 22,
412110400 County, Texas, containing 200.0 1982, between ARCO Oil and Gas Company and
100% WI acres more or less, and more East Texas Salt Water Disposal Company. (s)
87.5% NRI particularly described in that
certain Oil and Gas Lease dated AR-23556
October 15, 1930, recorded in Oil Well Gas Contract dated July 3, 1962, by
Volume 62, Page 62, Deed Records, and between The Atlantic Richfield Company
Gregg County, Texas (ARCO Permian), Seller, and Sinclair Oil &
Gas Company, Buyer
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-004951-000 That certain 48 l/2 acre tract AR-18030-000
S. G. Smith (s) out of the W. H. Castleberry Joint Operating Agreement dated May 14, 1957
416245500 Survey, Gregg County, Texas, and by and between Atlantic Refining Company,
50.00% WI more fully described in that Operator, and Humble Oil and Refining
43.75% NRI certain Oil, Gas & Mineral Lease Company, et al, Non-Operator. (d)
dated May 6, 1930, recorded in
White Oak Field Volume 4, Page 330, Deed Records, AR-95702
(Cotton Valley) Gregg County, Texas. Farmout Agreement dated February 13, 1990 by
T. B. Harris Gas Unit #2 (d) and between Atlantic Richfield Company, and C
437459200 W Resources, Inc. (d)
.000597% RI
3.180539% ORRI BPO AR-18030-001
7.63317% WI APO Declaration of Unit dated December 27, 1957,
6.67902% NRI APO C W Resources, Inc., Operator. (d)
T. B. Harris Gas Unit #3 (d) PD-3520
437459201 Operating Contract dated January 24, 1931,
.000597% RI recorded in Volume 68, Page 196, by and
3.180539% ORRI BPO between Frank R. Foster and Roeser &
7.63317% WI APO Pendleton, Inc.
6.67902% NRI APO
Private Radio License from Federal
T. B. Harris Gas Unit #5 (d) Communications Commission to ARCO
437459202 Communications, Inc., dated December 16,
.000597% RI 1992, File No. 0000000319451, Call Sign
3.180539% ORRI BPO KNEP883, Frequency 154.47875 MHZ
7.63317% WI APO
6.67902% NRI APO AR-7967
Casinghead Gas Contract dated June 6, 1950,
T. B. Harris Gas Unit #4 (d) by and between the Atlantic Refining Company,
.000597% RI et al and Arkansas Fuel Oil Company, as
3.180539% ORRI BPO amended on November 11, 1963 and March 16,
7.63317% WI APO 1979. (s)
6.67902% NRI APO
</TABLE>
Page 32 of 165
<PAGE> 59
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-043549-00A Alfred Jones and W. F. Turner 12-25-30 64 47
(Cotton Valley) wife, Fannie Jones
Shiloh School Gas Unit #1
(d)
411006400
0.072778% RI
1.17666% ORRI BPO
2.94166% WI APO
2.57395% NRI APO
42-183-043549-00B A. H. Teat, Trustee M. L. Giles 3-11-31 73 316
42-183-043549-00C A. H. Teat, husband Ralph Cole 4-24-31 79 497
of Lillian E. Teat
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-043549-00A A tract of land out of the G. W. AR-101547
(Cotton Valley) Hooper Survey A-92, Gregg County, Purchase and Sale Agreement dated November
Shiloh School Gas Unit #1 Texas, and more particularly 15, 1982 by and between Conoco, Inc. and
(d) described in that certain Oil and Petro-Lewis Corporation. (s/d)
411006400 Gas Lease dated December 25,
0.072778% RI 1930, recorded in Volume 64, Page AR-101580
1.17666% ORRI BPO 47, Deed Records, Gregg County, Like-Kind Exchange Agreement dated June 1,
2.94166% WI APO Texas. 1992 by and between Atlantic Richfield
2.57395% NRI APO Company and Conoco, Inc. (s/d)
AR-101621
42-183-043549-00B A tract of land out of the G. W. Purchase and Sale Agreement dated effective
Hooper Survey A-92, Gregg County, January 1, 1993, from Atlantic Richfield
Texas, and more particularly Company to Madera Production Company. (s)
described in that certain Oil and
Gas Lease dated March 11, 1931, AR-105435-000
recorded in Volume 73, Page 316, Farm Out Agreement dated January 4, 1996 by
Deed Records, Gregg County, Texas. and between Atlantic Richfield Company and
Madera Production Company. (d)
42-183-043549-00C A tract of land out of the G. W.
Hooper Survey A-92, Gregg County, AR-105435-001
Texas, and more particularly Declaration of Unitization effective November
described in that certain Oil and 1, 1995, C W Resources, Inc., Operator. (d)
Gas Lease dated April 24, 1931,
recorded in Volume 79, Page 497, AR-101548
Deed Records, Gregg County, Texas. Joint Operating Agreement dated January 1,
1983 by and between Conoco, Inc. and
Only insofar as leases cover Petro-Lewis Corporation. (s/d)
rights below the Base of the
Woodbine formation. AR-95702
Farmout Agreement dated February 13, 1990 by
and between Atlantic Richfield Company, and C
W Resources, Inc. (d)
</TABLE>
Page 33 of 165
<PAGE> 60
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-005961-00A Callie Jones, et al Dr. E. E. Terry, et 11-30-30 63 101
(Cotton Valley) al
Stucky-Thrasher Gas Unit (d)
412345000
1.443620 ORRI BPO
3.464689% WI APO
3.031602% NRI APO
42-183-005961-00B Ollie Jones C. A. Green 1-24-31 68 179
42-183-005961-00C Jane Jones Howard, et C. A. Green 1-24-31 68 182
al
42-183-005961-00D Callie Jones, et al M. H. Shivers, et al 3-6-31 79 141
42-183-005961-00E Arthur Christian, Arthur Mackey, et al 2-3-31 72 64
Guardian
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-005961-00A A tract of land out of the G. W. AR-95702-003
(Cotton Valley) Hooper Survey A-92, Gregg County, Declaration of Unitization and Designation of
Stucky-Thrasher Gas Unit (d) Texas, containing 100 acres more Gas Unit of the Stucky Thrasher Gas Unit.
412345000 or less, and more particularly (d)
1.443620 ORRI BPO described by metes and bounds in
3.464689% WI APO that certain Oil, Gas and Mineral AR-95702
3.031602% NRI APO Lease dated November 30, 1930, Farmout Agreement dated February 13, 1990 by
recorded in Volume 63, Page 101, and between Atlantic Richfield Company and C
Deed Records, Gregg County, Texas. W Resources, Inc. (d)AR-95702
42-183-005961-00B A tract of land out of the G. W. AR-101621
Hooper Survey A-92, Gregg County, Purchase and Sale Agreement effective January
Texas, containing 100 acres more 1, 1993 by and between Atlantic Richfield
or less, and more particularly Company and Madera Production Company.
described by metes and bounds in
that certain Oil, Gas and Mineral
Lease dated January 24, 1931,
recorded in Volume 68, Page 179,
Deed Records, Gregg County, Texas.
42-183-005961-00C A tract of land out of the G. W.
Hooper Survey A-92, Gregg County,
Texas, containing 100 acres more
or less, and more particularly
described by metes and bounds in
that certain Oil, Gas and Mineral
Lease dated January 24, 1931,
recorded in Volume 68, Page 182,
Deed Records, Gregg County, Texas.
42-183-005961-00D A tract of land out of the G. W.
Hooper Survey A-92, Gregg County,
Texas, containing 100 acres more
or less, and more particularly
described by metes and bounds in
that certain Oil, Gas and Mineral
Lease dated March 6, 1931,
recorded in Volume 79, Page 141,
Deed Records, Gregg County, Texas.
42-183-005961-00E A tract of land out of the G. W.
Hooper Survey A-92, Gregg County,
Texas, containing 100 acres more
or less, and more particularly
described by metes and bounds in
that certain Oil, Gas and Mineral
Lease dated February 3, 1931,
recorded in Volume 72, Page 64,
Deed Records, Gregg County, Texas.
Only insofar as leases cover
rights below the Base of the
Woodbine formation
</TABLE>
Page 34 of 165
<PAGE> 61
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-005961-00F Alex Jones, et ux A. H. Teat 1-27-31 66 350
(Cotton Valley)
Stucky-Thrasher Gas Unit (d)
412345000
(continued)
42-183-005961-00G Robert Smith R. W. Curtis 2-19-31 97 521
42-183-005961-00H G. C. Lunsford E. X. Birdsong 7-14-31 94 473
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-005961-00F A tract of land out of the G. W.
(Cotton Valley) Hooper Survey A-92, Gregg County,
Stucky-Thrasher Gas Unit (d) Texas, containing 100 acres more
412345000 or less, and more particularly
(continued) described by metes and bounds in
that certain Oil, Gas and Mineral
Lease dated January 27, 1931,
recorded in Volume 66, Page 350,
Deed Records, Gregg County, Texas.
42-183-005961-00G A tract of land out of the G. W.
Hooper Survey A-92, Gregg County,
Texas, containing 110.1 acres
more or less, and more
particularly described by metes
and bounds in that certain Oil,
Gas and Mineral Lease dated
February 19, 1931, recorded in
Volume 97, Page 521, Deed
Records, Gregg County, Texas.
42-183-005961-00H A tract of land out of the G. W.
Hooper Survey A-92, Gregg County,
Texas, containing 40.34 acres
more or less, and more
particularly described by metes
and bounds in that certain Oil,
Gas and Mineral Lease dated July
14, 1931, recorded in Volume 94,
Page 473, Deed Records, Gregg
County, Texas.
Only insofar as leases cover
rights below
the Base of the Woodbine
formation.
</TABLE>
Page 35 of 165
<PAGE> 62
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004045-00A Buck Harris Gaines B. Turner, 10-8-19 39 607
T. B. Harris (s) Trustee
414101900
100% WI
87.5045% NRI
White Oak Field
(Cotton Valley Sand)
T. B. Harris Gas Unit #5
437459202 41-183-004045-00B Clara L. Hayes, et al W. L. Pickens 1-15-31 65 213
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
White Oak Field
(Cotton Valley Sand)
T. B. Harris Gas Unit #3
437459201 42-183-004045-00C T. B. Harris, et al Otto L. Morris 2-12-31 70 429
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
White Oak Field
(Cotton Valley)
T. B. Harris Gas Unit #2 (d)
437459200 42-183-090121-000-001 Clara Jean Hodges, et Atlantic Richfield 7-24-40 252 243
.000597% RI (Surface Lease) vir Company
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #4 (d)
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004045-00A A tract of land out of the Wm. AR-95702
T. B. Harris (s) Castleberry Survey, A-38, Gregg Farmout Agreement dated February 13, 1990 by
414101900 County, Texas, containing 91.94 and between Atlantic Richfield Company, and C
100% WI acres more or less, and more W Resources, Inc. (d)
87.5045% NRI particularly described by metes
and bounds in that certain Oil Texas Natural Resources Conservation
and Gas Lease dated October 18, Commission Agreed Order (Docket No.
White Oak Field 1919, recorded in Volume 39, 97-0448-SIP) dated July 9, 1997. (s/d)
(Cotton Valley Sand) Page 607, Deed Records, Gregg
T. B. Harris Gas Unit #5 County, Texas. AR-105265-000
437459202 Purchase and Sale Agreement dated October 6,
.000597% RI 41-183-004045-00B A tract of land out of the Wm. 1995 by and between East Texas Gathering
3.180539% ORRI BPO Castleberry Survey, A-38, Gregg Company, Atlantic Richfield Company, Sun Pipe
7.63317% WI APO County, Texas, containing 91.94 Line Company and Sun Company, Inc. (s)
6.67902% NRI APO acres more or less, and more
particularly described by metes AR-105265-001
and bounds in that certain Oil Crude Oil Buy/Sell Contract dated effective
and Gas Lease dated January 15, December 1, 1995 by and between ARCO Permian
1931, recorded in Volume 65, and Sun Company, Inc. (s)
White Oak Field Page 213, Deed Records, Gregg
(Cotton Valley Sand) County, Texas. AR-18030-001
T. B. Harris Gas Unit #3 Declaration of Unit dated December 27, 1957,
437459201 42-183-004045-00C A tract of land out of the Wm. Atlantic Refining Company. (d)
.000597% RI Castleberry Survey, A-38, Gregg
3.180539% ORRI BPO County, Texas, containing 91.94 AR-98412
7.63317% WI APO acres more or less, and more Longview Gas Plant Gas Purchase Contract
6.67902% NRI APO particularly described by metes dated January 1, 1997, by and between ARCO
and bounds in that certain Oil Permian, Seller and ARCO Permian, Buyer, as
and Gas Lease dated February 12, amended effective August 1, 1998
1931, recorded in Volume 70,
White Oak Field Page 429, Deed Records, Gregg Private Radio License from Federal
(Cotton Valley) County, Texas. Communications Commission to ARCO
T. B. Harris Gas Unit #2 (d) Communications, Inc., dated December 16,
437459200 42-183-090121-000-001 24.405 acres of land in the 1992, File No. 0000000319451, Call Sign
.000597% RI (Surface Lease) William Castleberry Survey, Gregg KNEP883, Frequency 154.47875 MHZ
3.180539% ORRI BPO County, Texas, as more
7.63317% WI APO particularly described in that
6.67902% NRI APO certain Surface Lease dated July
24, 1940, recorded in Volume 252,
page 243, Deed Records, Gregg
County, Texas.
T. B. Harris Gas Unit #4 (d)
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
</TABLE>
Page 36 of 165
<PAGE> 63
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-009834-00A E. M. Whatley, et ux B. A. Skipper 5-6-30 4 387
(Cotton Valley)
T. B. Harris Gas Unit #2 (d)
437459200
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #3 (d) 42-183-009834-00B Gordon Whatley Lonnie Glasscock 1-19-31 66 156
437459201
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #5 (d)
437459202
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
T. B. Harris Gas Unit #4 (d)
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-009834-00A That certain tract of land out of AR-18030-000
(Cotton Valley) the William Robinson Survey, Joint Operating Agreement dated May 14, 1957
T. B. Harris Gas Unit #2 (d) Abstract 177, and W. H. by and between Atlantic Refining Company,
437459200 Castleberry Survey, Gregg County, Operator, and Humble Oil and Refining
.000597% RI Texas, and more fully described Company, et al, Non-Operator. (d)
3.180539% ORRI BPO by metes and bounds in that
7.63317% WI APO certain Oil and Gas Lease dated AR-101621
6.67902% NRI APO May 6, 1930, recorded in Volume Purchase and Sale Agreement dated effective
4, Page 387, Deed Records, Gregg January 1, 1993, from Atlantic Richfield
T. B. Harris Gas Unit #3 (d) 42-183-009834-00B County, Texas. Company to Madera Production Company. (s)
437459201
.000597% RI That certain tract of land out AR-95702
3.180539% ORRI BPO of the William Robinson Survey, Farmout Agreement dated February 13, 1990 by
7.63317% WI APO Abstract 177, and W. H. and between Atlantic Richfield Company, and C
6.67902% NRI APO Castleberry Survey, Gregg County, W Resources, Inc. (d)
Texas, and more fully described
T. B. Harris Gas Unit #5 (d) by metes and bounds in that AR-18030-001
437459202 certain Oil and Gas Lease dated Declaration Unit dated December 27, 1957,
.000597% RI January 19, 1931, recorded in Atlantic Refining Company, Operator. (d)
3.180539% ORRI BPO Volume 66, Page 156, Deed
7.63317% WI APO Records, Gregg County, Texas.
6.67902% NRI APO
T. B. Harris Gas Unit #4 (d)
.000597% RI
3.180539% ORRI BPO
7.63317% WI APO
6.67902% NRI APO
</TABLE>
Page 37 of 165
<PAGE> 64
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
White Oak Field 42-183-009834-00C Leonard Weldon Whatley Lonnie Glasscock 1-15-31 66 89
(Cotton Valley)
T. B. Harris Gas Unit #2 (d)
437459200
T. B. Harris Gas Unit #3 (d)
437459201
T. B. Harris Gas Unit #5 (d)
437459202 42-183-009834-00D Novie Wood, et ux, E. B. Germany 1-15-31 63 434
et al
T. B. Harris Gas Unit #4 (d)
(continued)
42-183-009834-00E Preston Lee, et ux W. P. Luse 3-14-31 75 98
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
<S> <C> <C> <C>
White Oak Field 42-183-009834-00C That certain tract of land out of
(Cotton Valley) the William Robinson Survey,
T. B. Harris Gas Unit #2 (d) Abstract 177, and W. H.
437459200 Castleberry Survey, Gregg County,
Texas, and more fully described
T. B. Harris Gas Unit #3 (d) by metes and bounds in that
437459201 certain Oil and Gas Lease dated
January 15, 1931, recorded in
Volume 66, Page 89, Deed Records,
T. B. Harris Gas Unit #5 (d) Gregg County, Texas.
437459202
42-183-009834-00D That certain tract of land out of
the William Robinson Survey,
Abstract 177, and W. H.
T. B. Harris Gas Unit #4 (d) Castleberry Survey, Gregg County,
(continued) Texas, and more fully described
by metes and bounds in that
certain Oil and Gas Lease dated
January 15, 1931, recorded in
Volume 63, Page 434, Deed
Records, Gregg County, Texas.
42-183-009834-00E That certain tract of land out of
the William Robinson Survey,
Abstract 177, and W. H.
Castleberry Survey, Gregg County,
Texas, and more fully described
by metes and bounds in that
certain Oil and Gas Lease dated
March 14, 1931, recorded in
Volume 75, Page 98, Deed Records,
Gregg County, Texas.
</TABLE>
Page 38 of 165
<PAGE> 65
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003990-000 T. W. Lee J. K. Wadley 3-23-31 78 246
T. W. Lee (s)
414745600
92.50% WI
80.9375% NRI
Glenwood Field
(Cotton Valley)
T. W. Lee Gas Unit
415131300
9.10804% ORRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003990-000 A tract of land out of the David AR-105473
T. W. Lee (s) Ferguson Survey, Gregg County, Farmout Agreement dated effective February 1,
414745600 Texas, containing 111.67 acres 1996 by and between Atlantic Richfield
92.50% WI more or less, and more Company, Wagner & Brown, Ltd., and C W
80.9375% NRI particularly described in that Resources, Inc. (d)
certain Oil and Gas Lease dated
Glenwood Field March 23, 1931, recorded in AR-105265-000
(Cotton Valley) Volume 78, Page 246, Deed Purchase and Sale Agreement dated October 6,
T. W. Lee Gas Unit Records, Gregg County, Texas. 1995 by and between East Texas Gathering
415131300 Company, Atlantic Richfield Company, Sun Pipe
9.10804% ORRI Line Company and Sun Company, Inc. (s)
AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-81381
Longview Gas Plant Oil Well Gas Purchase
Contract dated July 24, 1996, by and between
ARCO Permian, seller and ARCO Permian, buyer,
as amended effective August 13, 1998. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 39 of 165
<PAGE> 66
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-004024-000 Allen Tooke, et al Ardis O. Phillips 10-7-30 4 501
Tooke "B" (s)
416530600
100% WI
87.50% NRI
White Oak Field
(Cotton Valley)
Allen Tooke Gas Unit #1 (d)
411005600
4.540623% ORRI
Tooke "B" (s)
413014600
0.001395% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-004024-000 A tract of land out of the W. G. AR-105265-000
Tooke "B" (s) Painter Survey, Gregg County, Purchase and Sale Agreement dated October 6,
416530600 Texas, containing 44.0 acres more 1995 by and between East Texas Gathering
100% WI or less, and more particularly Company, Atlantic Richfield Company, Sun Pipe
87.50% NRI described in that certain Oil and Line Company and Sun Company, Inc. (s)
Gas Lease dated October 7, 1930,
White Oak Field recorded in Volume 4, Page 501, AR-105265-001
(Cotton Valley) Deed Records, Gregg County, Texas. Crude Oil Buy/Sell Contract dated effective
Allen Tooke Gas Unit #1 (d) December 1, 1995 by and between ARCO Permian
411005600 and Sun Company, Inc. (s)
4.540623% ORRI
AR-95702
Tooke "B" (s) Farmout Agreement dated February 13, 1990 by
413014600 and between Atlantic Richfield Company, and C
0.001395% RI W Resources, Inc. (d)
AR-95702-007
Declaration of Unitization and Designation of
Gas Unit dated April 4, 1995, C W Resources,
Inc., Operator. (d)
AR-81381
Longview Gas Plant Oil Well Gas Purchase
Contract dated July 24, 1996, by and between
ARCO Permian, seller and ARCO Permian, buyer,
as amended effective August 13, 1998. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 40 of 165
<PAGE> 67
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003971-00A Tommy Lee Turner, et P. A. Curtis and H. 9-27-30 63 161
Turner (s) ux H. Ivins
416570500
79.21870% WI
69.31960% NRI
White Oak Field
(Cotton Valley)
Allen Tooke Gas Unit #1 (d) 42-183-003971-00B Lizann Williams, R. W. Burnett 1-30-31 68 287
411005600 et vir
4.540623% ORRI
42-183-003971-00C Charlie Turner, et ux Ray Bumpus 1-31-31 68 291
42-183-003971-00D Houston Stephens, W. E. Hicks 2-3-31 70 215
et ux, et al
42-183-003971-00E Houston Stephens, T. M. Garland 3-13-31 77 258
et ux, et al
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003971-00A A tract of land out of the W. C. PD-2062
Turner (s) Wakeland H. R. Survey, Gregg Operating Agreement dated December 21, 1931
416570500 County, Texas, containing 157.0 by and between Atlantic Oil Producing
79.21870% WI acres more or less, and more Company, Operator, and J. K. Wadley,
69.31960% NRI particularly described in that Non-Operator. (s/d)
certain Oil and Gas Lease dated
September 27, 1930, recorded in AR-52724
Volume 63, Page 161, Deed Salt Water Disposal Agreement dated September
White Oak Field Records, Gregg County, Texas. 29, 1975, between Atlantic Richfield Company
(Cotton Valley) and East Texas Salt Water Disposal Company.
Allen Tooke Gas Unit #1 (d) 42-183-003971-00B A tract of land out of the W. C. (s)
411005600 Wakeland H. R. Survey, Gregg
4.540623% ORRI County, Texas, containing 87.0 AR-105265-000
acres more or less, and more Purchase and Sale Agreement dated October 6,
particularly described by metes 1995 by and between East Texas Gathering
and bounds in that certain Oil Company, Atlantic Richfield Company, Sun Pipe
and Gas Lease dated January 30, Line Company and Sun Company, Inc. (s)
1931, recorded in Volume 68, Page
287, Deed Records, Gregg County, AR-105265-001
Texas. Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
42-183-003971-00C A tract of land out of the W. C. and Sun Company, Inc. (s)
Wakeland H. R. Survey, Gregg
County, Texas, containing 157.0 AR-95702
acres more or less, and more Farmout Agreement dated February 13, 1990 by
particularly described by metes and between Atlantic Richfield Company, and C
and bounds in that certain Oil W Resources, Inc. (d)
and Gas Lease dated January 31,
1931, recorded in Volume 68, Page AR-95702-007
291, Deed Records, Gregg County, Declaration of Unitization and Designation of
Texas. Gas Unit dated April 4, 1995, C W Resources,
Inc. , Operator. (d)
42-183-003971-00D A tract of land out of the W. C.
Wakeland Survey, Gregg County, AR-81381
Texas, containing 29.0 acres more Longview Gas Plant Oil Well Gas Purchase
or less, and more particularly Contract dated July 24, 1996, by and between
described by metes and bounds in ARCO Permian, seller and ARCO Permian, buyer,
that certain Oil and Gas Lease as amended effective August 13, 1998. (s)
dated February 3, 1931, recorded
in Volume 70, Page 215, Deed Private Radio License from Federal
Records, Gregg County, Texas. Communications Commission to ARCO
Communications, Inc., dated December 16,
42-183-003971-00E A tract of land out of the W. C. 1992, File No. 0000000319451, Call Sign
Wakeland H. R. Survey, Gregg KNEP883, Frequency 154.47875 MHZ
County, Texas, containing 14.0
acres more or less, and more
particularly described by metes
and bounds in that certain Oil
and Gas Lease dated March 13,
1931, recorded in Volume 77, Page
258, Deed Records, Gregg County,
Texas.
</TABLE>
Page 41 of 165
<PAGE> 68
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003971-00F Harvey Turner, et ux R. W. Burnett 3-28-31 72 561
Turner (s)
416570500
White Oak Field
(Cotton Valley)
Allen Tooke Gas Unit #1 (d)
411005600
(continued)
42-183-003971-00G Bethie Green, et vir, C. M. Beckett 4-1-31 75 458
et al
42-183-003971-00H Tommie Lee Turner, C. M. Beckett 4-1-31 84 29
et ux, et al
42-183-003971-00I Elnora Turner, et al William L. Goodwin 4-2-31 77 506
42-183-003971-00J A. Turner, et al E. H. Brannon 4-7-31 78 519
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003971-00F A tract of land out of the W. C.
Turner (s) Wakeland Survey, Gregg County,
416570500 Texas, containing 157.0 acres
more or less, and more
White Oak Field particularly described by metes
(Cotton Valley) and bounds in that certain Oil
Allen Tooke Gas Unit #1 (d) and Gas Lease dated March 28,
411005600 1931, recorded in Volume 72, Page
(continued) 561, Deed Records, Gregg County,
Texas.
42-183-003971-00G A tract of land out of the W. C.
Wakeland Survey, Gregg County,
Texas, containing 157.0 acres
more or less, and more
particularly described in that
certain Oil and Gas Lease dated
April 1, 1931, recorded in Volume
75, Page 458, Deed Records, Gregg
County, Texas.
42-183-003971-00H A tract of land out of the W. C.
Wakeland Survey, Gregg County,
Texas, containing 87.0 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated April 1, 1931,
recorded in Volume 84, Page 29,
Deed Records, Gregg County, Texas.
42-183-003971-00I A tract of land out of the W. C.
Wakeland Survey, Gregg County,
Texas, containing 157.0 acres
more or less, and more
particularly described by metes
and bounds in that certain Oil
and Gas Lease dated April 2,
1931, recorded in Volume 77, Page
506, Deed Records, Gregg County,
Texas.
42-183-003971-00J A tract of land out of the W. C.
Wakeland H. R. Survey, Gregg
County, Texas, containing 80.0
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
April 7, 1931, recorded in Volume
78, Page 519, Deed Records, Gregg
County, Texas.
</TABLE>
Page 42 of 165
<PAGE> 69
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003971-00K Houston Stephens, et J. K. Wadley 4-18-31 80 511
Turner (s) ux, et al
416570500
White Oak Field
(Cotton Valley)
Allen Tooke Gas Unit #1 (d)
411005600
(continued)
42-183-003971-00L J. N. Whittle J. K. Wadley 4-29-31 74 629
42-183-003971-00M Elnora Turner, J. K. Wadley 4-30-31 74 635
Guardian
42-183-003971-00N J. T. Dickerson, as E. H. Brannon 5-11-31 90 9
Attorney-in-Fact
42-183-003971-00O Houston Stephens, J. K. Wadley and C 5-25-31 91 180
et ux, et al M. Beckett
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003971-00K A tract of land out of the W. C.
Turner (s) Wakeland H. R. Survey, Gregg
416570500 County, Texas, containing 87.0
acres more or less, and more
White Oak Field particularly described by metes
(Cotton Valley) and bounds in that certain Oil
Allen Tooke Gas Unit #1 (d) and Gas Lease dated April 18,
411005600 1931, recorded in Volume 80, Page
(continued) 511, Deed Records, Gregg County,
Texas.
42-183-003971-00L A tract of land out of the W. C.
Wakeland Survey, Gregg County,
Texas, containing 29.0 acres more
or less, and more particularly
described by metes and bounds in
that certain Oil and Gas Lease
dated April 29, 1931, recorded in
Volume 74, Page 629, Deed
Records, Gregg County, Texas.
42-183-003971-00M A tract of land out of the W. C.
Wakeland Survey, Gregg County,
Texas, containing 157.0 acres
more or less, and more
particularly described by metes
and bounds in that certain Oil
and Gas Lease dated April 30,
1931, recorded in Volume 74, Page
635, Deed Records, Gregg County,
Texas.
42-183-003971-00N A tract of land out of the W. C.
Wakeland H. R. Survey, Gregg
County, Texas, containing 157.0
acres more or less, and more
particularly described by metes
and bounds in that certain Oil
and Gas Lease dated May 11, 1931,
recorded in Volume 90, Page 9,
Deed Records, Gregg County, Texas.
42-183-003971-00O A tract of land out of the W. C.
Wakeland Survey, Gregg County,
Texas, containing 87.0 acres more
or less, and more particularly
described by metes and bounds in
that certain Oil and Gas Lease
dated May 25, 1931, recorded in
Volume 91, Page 180, Deed
Records, Gregg County, Texas.
</TABLE>
Page 43 of 165
<PAGE> 70
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003971-00P W. V. Derrick, Leland Fikes 6-15-31 94 132
Turner (s) Guardian
416570500
White Oak Field
(Cotton Valley)
Allen Tooke Gas Unit #1 (d)
411005600
(continued)
42-183-003971-00Q J. K. Wadley Atlantic Oil 7-7-31 95 278
Producing Company
42-183-003971-00R Leland Fikes J. K. Wadley 7-27-31 100 114
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003971-00P A tract of land out of the W. C.
Turner (s) Wakeland H. R. Survey, Gregg
416570500 County, Texas, containing 157.0
acres more or less, and more
White Oak Field particularly described by metes
(Cotton Valley) and bounds in that certain Oil
Allen Tooke Gas Unit #1 (d) and Gas Lease dated June 15,
411005600 1931, recorded in Volume 94, Page
(continued) 132, Deed Records, Gregg County,
Texas.
42-183-003971-00Q A tract of land out of the W. C.
Wakeland Survey, Gregg County,
Texas, containing 157.0 acres
more or less, and more
particularly described by metes
and bounds in that certain Oil
and Gas Lease dated July 7, 1931,
recorded in Volume 95, Page 278,
Deed Records, Gregg County, Texas.
42-183-003971-00R A tract of land out of the W. C.
Wakeland H. R. Survey, Gregg
County, Texas, containing 157.0
acres more or less, and more
particularly described by metes
and bounds in that certain Oil
and Gas Lease dated July 27,
1931, recorded in Volume 100,
Page 114, Deed Records, Gregg
County, Texas.
</TABLE>
Page 44 of 165
<PAGE> 71
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-005960-000 J. M. Tuttle et ux B. A. Skipper 5-15-30 60 197
Tuttle "B" (s) Georgia A. Tuttle
416580200
86.58% WI
75.7575% NRI
White Oak Field
(Cotton Valley)
Pet Hopkins Gas Unit (d)
437459203
0.000016% RI
1.652946% ORRI BPO
10.897494% WI APO
9.535307% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-005960-000 A tract of land out of the Wm. H. AR-00058500
Tuttle "B" (s) Castleberry Survey A-38, Gregg Joint Operating Agreement dated November 1,
416580200 County, Texas, and more 1937 between The Atlantic Refining Company
86.58% WI particularly described in that and Petroleum Corporation of Venezuela. (s/d)
75.7575% NRI certain Oil and Gas Lease dated
May 15, 1930, recorded in Volume AR-7689
White Oak Field 60, Page 197, Deed Records, Gregg Casinghead Gas Contract dated June 9, 1950,
(Cotton Valley) County, Texas. by and between The Atlantic Refining Company
Pet Hopkins Gas Unit (d) (ARCO Oil & Gas), et al, Seller, and Arkansas
437459203 Fuel Oil Company (Trident NGL, Inc.), Buyer.
0.000016% RI
1.652946% ORRI BPO AR-95702
10.897494% WI APO Farmout Agreement dated February 13, 1990 by
9.535307% NRI APO and between Atlantic Richfield Company, and C
W Resources, Inc. (d)
AR-95702-005
Declaration of Unitization and Designation of
Gas Unit dated July 16, 1993 between Atlantic
Richfield Company and C W Resources, Inc. (d)
AR-105265-000
Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
Company, Atlantic Richfield Company, Sun Pipe
Line Company and Sun Company, Inc. (s)
AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 45 of 165
<PAGE> 72
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-005877-000 L. Y. Tuttle and T. Tom Richardson and 1-16-31 68 157
Tuttle "C" (s) J. Tuttle Grace Bennett
416585300
100% WI
87.50% NRI
White Oak Field
(Cotton Valley)
Houston Stephens Gas Unit
#1-X (d)
437450900
.2369801% ORRI BPO
.56875% WI APO
.49765625% NRI APO
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000816-000 Lowell Brawley Argo Royalty Company 5-20-31 92 21
W. L. Brawley (776) (Mineral Deed)
410462500
6.2500% RI
White Oak Field
(Cotton Valley)
M. C. Salter Gas Unit
417654500
2.7734375% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-005877-000 A tract of land out of the W. H. AR-95702
Tuttle "C" (s) Castleberry Survey, Gregg County, Farmout Agreement dated February 13, 1990 by
416585300 Texas, containing 12.36 acres and between Atlantic Richfield Company, and C
100% WI more or less, and more W Resources, Inc. (d)
87.50% NRI particularly described in that
certain Oil and Gas Lease dated AR-95702-001
White Oak Field January 16, 1931, recorded in Declaration of Unitization & Designation of
(Cotton Valley) Volume 68, Page 157, Deed Gas Unit dated January 16, 1992.
Houston Stephens Gas Unit Records, Gregg County, Texas.
#1-X (d) Private Radio License from Federal
437450900 Communications Commission to ARCO
.2369801% ORRI BPO Communications, Inc., dated December 16,
.56875% WI APO 1992, File No. 0000000319451, Call Sign
.49765625% NRI APO KNEP883, Frequency 154.47875 MHZ
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000816-000 A tract of land out of the M. AR-104964-000
W. L. Brawley (776) (Mineral Deed) Mann Survey, A-302, Upshur Farmout (Oil & Gas Lease) dated May 20, 1993
410462500 County, Texas, and the Dolores by and between Atlantic Richfield Company,
6.2500% RI Sanches Survey, A-186, Gregg Lessor, and R. Byron Roach, Lessee, as
County, Texas, and A-669, Upshur referred to in Memorandum of Oil and Gas
White Oak Field County, Texas, containing 28.4 Lease dated May 20, 1993, recorded in Volume
(Cotton Valley) acres more or less, and more 138, Page 242, Records of Upshur County,
M. C. Salter Gas Unit particularly described in Mineral Texas and Volume 2521, Page 23, Records of
417654500 Deed dated May 20, 1931, recorded Gregg County, Texas. (d)
2.7734375% RI in Volume 92, Page 21, Deed
Records, Gregg County, Texas. AR-104964-000-001
Pooling Declaration and Designation of Gas
Unit effective March 1, 1994. (Chinn
Exploration Company-M. C. Salter Gas Unit)
(d)
</TABLE>
Page 46 of 165
<PAGE> 73
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000819-000 W. Q. Seale Argo Royalty Co. 3-8-34 161 339
Wm. Cobb. (9232,875) (Mineral Deed)
410500100
3.0270% RI
Wm. Cobb (A-356,950)
410503600
3.0273% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-183-000811-000 T. C. Denton Argo Royalty Company 4-28-31 84 352
Wheeler "A" (10880, 19100) (Mineral Deed)
(s)
410977500
3.125% RI
East Texas Field
Wheeler (419112, 403) (s) T. C. Denton Argo Royalty Company 4-29-31 85 241
410976700
3.125% RI
East Texas Field
Wheeler (s)
415346400
3.125% RI
Glenwood Field
(Cotton Valley)
W. W. Wheeler (d)
410559100
3.125% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000819-000 All that certain tract or parcel Oil and Gas Lease dated August 6, 1931
Wm. Cobb. (9232,875) (Mineral Deed) of land in Gregg County, Texas, recorded in Volume 100, Page 390, Deed
410500100 being a part of the Carl Rhodes Records, Gregg County, Texas.
3.0270% RI Survey and a part of the William
Cobb Homestead, as more
Wm. Cobb (A-356,950) particularly described in that
410503600 certain Mineral Deed dated March
3.0273% RI 8, 1934, recorded in Volume 161,
Page 339, Deed Records, Gregg
County, Texas.
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-183-000811-000 46.84 acres, more or less, out of Oil and Gas Lease dated January 2, 1931,
Wheeler "A" (10880, 19100) (Mineral Deed) the David Ferguson Survey, and recorded in Volume 67, Page 109, Deed
(s) more particularly described in Records, Gregg County, Texas.
410977500 that certain Mineral Deed dated
3.125% RI April 28, 1931, recorded in
Volume 84, Page 352, Deed
East Texas Field Records, Gregg County, Texas.
Wheeler (419112, 403) (s)
410976700 46.84 acres, more or less, out of
3.125% RI the David Ferguson Survey, and
more particularly described in
East Texas Field that certain Mineral Deed dated
Wheeler (s) April 29, 1931, recorded in
415346400 Volume 85, Page 241, Deed
3.125% RI Records, Gregg County, Texas.
Glenwood Field
(Cotton Valley)
W. W. Wheeler (d)
410559100
3.125% RI
</TABLE>
Page 47 of 165
<PAGE> 74
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-000186-000 W. L. Cunningham, Atlantic Oil 11-10-33 155 161
Wilson (s) (Mineral Deed) et al Producing Company
416855100
100% WI
.3789% RI
87.5% NRI
Glenwood Field
(Cotton Valley)
J. W. Wilson #1 (d) 42-183-000186-00A Ed Barnett Atlantic Oil 8-4-33 152 289
410006900 (Mineral Deed) Producing Company
.3789% RI
12.5% ORRI
42-183-000186-00B O. M. Grisham Atlantic Oil 10-10-33 152 516
(Mineral Deed) Producing Company
42-183-003998-00A Mattie Lockett, Leland Fikes 3-30-31 75 449
et vir
42-183-003998-00B Clyde Williams, C. H. Ainsworth 4-24-31 85 177
et al
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-000186-000 A tract of land out of the AR-105265-000
Wilson (s) (Mineral Deed) William C. Wakeland Survey, Purchase and Sale Agreement dated October 6,
416855100 A-218, Gregg County, Texas, 1995 by and between East Texas Gathering
100% WI containing 100 acres more or Company, Atlantic Richfield Company, Sun Pipe
.3789% RI less, and being more particularly Line Company and Sun Company, Inc. (s)
87.5% NRI described in that certain Mineral
Deed dated November 10, 1933, AR-105265-001
Glenwood Field recorded in Volume 155, Page 161, Crude Oil Buy/Sell Contract dated effective
(Cotton Valley) Deed Records, Gregg County, Texas. December 1, 1995 by and between ARCO Permian
J. W. Wilson #1 (d) and Sun Company, Inc. (s)
410006900 42-183-000186-00A A tract of land out of the
.3789% RI (Mineral Deed) William C. Wakeland Survey, AR-81381
12.5% ORRI A-218, Gregg County, Texas, Longview Gas Plant Oil Well Gas Purchase
containing 100 acres more or Contract dated July 24, 1996, by and between
less, and being more particularly ARCO Permian, seller and ARCO Permian, buyer,
described in that certain Mineral as amended effective August 13, 1998. (s)
Deed dated August 4, 1933,
recorded in Volume 152, Page 289, AR-105473
Deed Records, Gregg County, Texas. Farmout Agreement dated effective February 1,
1996 by and between Atlantic Richfield
42-183-000186-00B A tract of land out of the Company, Wagner & Brown, Ltd., and C W
(Mineral Deed) William C. Wakeland Survey, Resources, Inc. (d)
A-218, Gregg County, Texas,
containing 100 acres more or AR-95702
less, and being more particularly Farmout Agreement dated February 13, 1990 by
described in that certain Mineral and between Atlantic Richfield Company, and C
Deed dated October 10, 1933, W Resources, Inc. (d)
recorded in Volume 152, Page 516,
Deed Records, Gregg County, Texas. Private Radio License from Federal
Communications Commission to ARCO
42-183-003998-00A A tract of land out of the Communications, Inc., dated December 16,
William C. Wakeland Survey, Gregg 1992, File No. 0000000319451, Call Sign
County, Texas, containing 100 KNEP883, Frequency 154.47875 MHZ
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
March 30, 1931, recorded in
Volume 75, Page 449, Deed
Records, Gregg County, Texas.
42-183-003998-00B A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
April 24, 1931, recorded in
Volume 85, Page 177, Deed
Records, Gregg County, Texas.
</TABLE>
Page 48 of 165
<PAGE> 75
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003998-00C C. H. Ainsworth, et al B. R. McLemore 5-12-31 File # 17351
Wilson (s)
416855100
Glenwood Field
(Cotton Valley)
J. W. Wilson #1 (d)
410006900
(continued) 42-183-003998-00D Robert Robertson, J. K. Lewis, et al 1-2-31 64 147
et ux
42-183-003998-00E Sidney Wheeler, et ux Paul D. Smith 2-19-31 70 415
42-183-003998-00F Sidney Wheeler, et al Paul D. Smith, et al 4-1-31 81 148
42-183-003998-00G George Boyd, et ux C. M. Beckett 4-3-31 79 222
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003998-00C A tract of land out of the
Wilson (s) William C. Wakeland Survey, Gregg
416855100 County, Texas, containing 100
acres more or less, and more
Glenwood Field particularly described in that
(Cotton Valley) certain Oil and Gas Lease dated
J. W. Wilson #1 (d) May 12, 1931, recorded in File
410006900 #17351, Deed Records, Gregg
(continued) County, Texas.
42-183-003998-00D A part of the Wakeland H. R.
Survey, Gregg County, Texas,
containing 9 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated January 2, 1931, recorded
in Volume 64, Page 147, Deed
Records, Gregg County, Texas.
42-183-003998-00E A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
February 19, 1931, recorded in
Volume 70, Page 415, Deed
Records, Gregg County, Texas.
42-183-003998-00F A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
April 1, 1931, recorded in
Volume 81, Page 148, Deed
Records, Gregg County, Texas.
42-183-003998-00G A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
April 3, 1931, recorded in Volume
79, Page 222, Deed Records, Gregg
County, Texas.
</TABLE>
Page 49 of 165
<PAGE> 76
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003998-00H Frank Wilson, et al C. M. Beckett 4-8-31 83 88
Wilson (s)
416855100
Glenwood Field
(Cotton Valley)
J. W. Wilson #1 (d)
410006900
(continued) 42-183-003998-00I F. R. Wilson, et al C. M. Beckett 6-17-31 95 335
42-183-003998-00J Bethie Green, et al A. G. Griffin 1-29-31 78 429
42-183-003998-00K Harvey Turner, et ux J. Brown Cutbirth 1-29-31 78 499
42-183-003998-00L Margaret Ansley, J. Brown Cutbirth 1-29-31 78 497
et vir
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003998-00H A tract of land out of the
Wilson (s) William C. Wakeland Survey, Gregg
416855100 County, Texas, containing 100
acres more or less, and more
Glenwood Field particularly described in that
(Cotton Valley) certain Oil, Gas and Mining Lease
J. W. Wilson #1 (d) dated April 8, 1931, recorded in
410006900 Volume 83, Page 88, Deed Records,
(continued) Gregg County, Texas.
42-183-003998-00I A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
June 17, 1931, recorded in Volume
95, Page 335, Deed Records, Gregg
County, Texas.
42-183-003998-00J A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
January 29, 1931, recorded in
Volume 78, Page 429, Deed
Records, Gregg County, Texas.
42-183-003998-00K A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil, Gas and Mining Lease
dated January 29, 1931, recorded
in Volume 78, Page 499, Deed
Records, Gregg County, Texas.
42-183-003998-00L A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil, Gas and Mining Lease
dated January 29, 1931, recorded
in Volume 78, Page 497, Deed
Records, Gregg County, Texas.
</TABLE>
Page 50 of 165
<PAGE> 77
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003998-00M Norman Wilson, et ux J. Brown Cutbirth 5-14-31 90 208
Wilson (s)
416855100
Glenwood Field
(Cotton Valley)
J. W. Wilson #1 (d)
410006900
(continued)
42-183-003998-00N Norman Wilson, asm Mrs. Johnny Bradley 1-13-31 63 375
42-183-003998-00O Susie Williams, Grdn. B. R. McLemore, et al 5-20-31 File #
15897
42-183-003998-00P Mahalie Williams, B. R. McLemore 5-25-31 File #
et al 17353
42-183-003998-00Q Ledonia Johnson, H. J. Horstman 5-6-31 84 502
et vir
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003998-00M A tract of land out of the
Wilson (s) William C. Wakeland Survey, Gregg
416855100 County, Texas, containing 100
acres more or less, and more
Glenwood Field particularly described in that
(Cotton Valley) certain Oil and Gas Lease dated
J. W. Wilson #1 (d) May 14, 1931, recorded in Volume
410006900 90, Page 208, Deed Records, Gregg
(continued) County, Texas.
42-183-003998-00N A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
January 13, 1931, recorded in
Volume 63, Page 375, Deed
Records, Gregg County, Texas.
42-183-003998-00O A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil, Gas and Mining Lease
dated May 20, 1931, recorded File
#15897, Deed Records, Gregg
County, Texas.
42-183-003998-00P A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil, Gas and Mining Lease
dated May 25, 1931, recorded File
#17353, Deed Records, Gregg
County, Texas.
42-183-003998-00Q A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 6, 1931, recorded in Volume
84, Page 502, Deed Records, Gregg
County, Texas.
</TABLE>
Page 51 of 165
<PAGE> 78
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003998-00R Julia W. White, et vir H. J. Horstman 5-8-31 81 482
Wilson (s)
416855100
Glenwood Field
(Cotton Valley)
J. W. Wilson #1 (d)
410006900
(continued) 42-183-003998-00S Callie W. Bowen, et al H. J. Horstman 4-29-31 85 255
42-183-003998-00T Lambert Chaffin, Gdn. H. J. Horstman 5-6-31 84 501
42-183-003998-00U Lambert Chaffin, et al H. J. Horstman 4-30-31 83 295
42-183-003998-00V James Sheppard B. R. McLemore, et al 5-25-31 92 7
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003998-00R A tract of land out of the
Wilson (s) William C. Wakeland Survey, Gregg
416855100 County, Texas, containing 100
acres more or less, and more
Glenwood Field particularly described in that
(Cotton Valley) certain Oil and Gas Lease dated
J. W. Wilson #1 (d) May 8, 1931, recorded Volume 81,
410006900 Page 482, Deed Records, Gregg
(continued) County, Texas.
42-183-003998-00S A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
April 29, 1931, recorded in
Volume 85, Page 255, Deed
Records, Gregg County, Texas.
42-183-003998-00T A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 6, 1931, recorded in Volume
84, Page 501, Deed Records, Gregg
County, Texas.
42-183-003998-00U A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
April 30, 1931, recorded in
Volume 83, Page 295, Deed
Records, Gregg County, Texas.
42-183-003998-00V A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 25, 1931, recorded in Volume
92, Page 7, Deed Records, Gregg
County, Texas.
</TABLE>
Page 52 of 165
<PAGE> 79
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003998-00W Mogieree Jones Cannon J. O. Ellinger 5-23-31 86 429
Wilson (s)
416855100
Glenwood Field
(Cotton Valley)
J. W. Wilson #1 (d)
410006900
(continued) 42-183-003998-00X Andrew Jones, et al J. O. Ehlinger 5-2-31 79 615
42-183-003998-00Y Andrew Jones, et al J. O. Ehlinger 5-15-31 89 167
42-183-003998-00Z Elisha Williams, et al Atlantic Oil 6-29-31 90 565
Producing Company
42-183-003998-0AA Joe Wheeler Atlantic Oil 6-29-31 90 567
Producing Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003998-00W A tract of land out of the
Wilson (s) William C. Wakeland Survey, Gregg
416855100 County, Texas, containing 100
acres more or less, and more
Glenwood Field particularly described in that
(Cotton Valley) certain Oil and Gas Lease dated
J. W. Wilson #1 (d) May 23, 1931, recorded in Volume
410006900 86, Page 429, Deed Records, Gregg
(continued) County, Texas.
42-183-003998-00X A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 2, 1931, recorded in Volume
79, Page 615, Deed Records, Gregg
County, Texas.
42-183-003998-00Y A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 15, 1931, recorded in Volume
89, Page 167, Deed Records, Gregg
County, Texas.
42-183-003998-00Z A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
June 29, 1931, recorded in
Volume 90, Page 565, Deed
Records, Gregg County, Texas.
42-183-003998-0AA A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
June 29, 1931, recorded in
Volume 90, Page 567, Deed
Records, Gregg County, Texas.
</TABLE>
Page 53 of 165
<PAGE> 80
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-003998-0AB Susie Williams, A-I-F Atlantic Oil 7-30-31 99 217
Wilson (s) Producing Company
416855100
Glenwood Field
(Cotton Valley)
J. W. Wilson #1 (d)
410006900
(continued) 42-183-003998-0AC John L. Keevil Paul S. Adams 8-20-31 103 136
42-183-003998-0AD Curley Jones Atlantic Oil 10-20-31 110 56
Producing Company
42-183-003998-0AE Nathaniel Williams Atlantic Oil 6-22-32 129 528
Producing Company
42-183-003998-0AF John C. Robbins, Jr. Atlantic Oil 11-8-32 139 214
Producing Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-003998-0AB A tract of land out of the
Wilson (s) William C. Wakeland Survey, Gregg
416855100 County, Texas, containing 100
acres more or less, and more
Glenwood Field particularly described in that
(Cotton Valley) certain Oil and Gas Lease dated
J. W. Wilson #1 (d) July 30, 1931, recorded in
410006900 Volume 99, Page 217, Deed
(continued) Records, Gregg County, Texas.
42-183-003998-0AC Two tracts of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 129.49
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
August 20, 1931, recorded in
Volume 103, Page 136, Deed
Records, Gregg County, Texas.
42-183-003998-0AD A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
October 20, 1931, recorded in
Volume 110, Page 56, Deed
Records, Gregg County, Texas.
42-183-003998-0AE A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil, Gas and Mining Lease
dated June 22, 1932, recorded in
Volume 129, Page 528, Deed
Records, Gregg County, Texas.
42-183-003998-0AF A tract of land out of the
William C. Wakeland Survey, Gregg
County, Texas, containing 100
acres more or less, and more
particularly described in that
certain Oil, Gas and Mining Lease
dated November 8, 1932, recorded
in Volume 139, Page 214, Deed
Records, Gregg County, Texas.
</TABLE>
Page 54 of 165
<PAGE> 81
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-183-043531-000 C.L. Still, et ux D. H. Byrd 11-28-30 62 209
C. L. Still (s)
416017700
.0731% ORRI
(d)
2.658 Acres
28.430 Gross Acres
East Texas Field None
Tooke "A" Small Royalty
413013800 Interest
.0014% RI
D. O. 42-183-031066
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-183-043531-000 A tract of land containing 28.43 AR-101556
C. L. Still (s) acres, more or less, out of the Operating Agreement dated December 4, 1931,
416017700 John Wilkinson Survey, A-224, by and between Gulf Production Company,
.0731% ORRI Gregg County, Texas, and more Operator, and Byrd-Frost, Inc.,
(d) particularly described in that Non-Operator. (s/d)
2.658 Acres certain Assignment of Oil and Gas
28.430 Gross Acres Lease dated July 1, 1952, AR-101564
recorded in Volume 382, Page 424, Operating Agreement dated September 1, 1964,
Deed Records, Gregg County, Texas by and between Tenneco Exploration Company,
Operator, and Continental Oil Company,
Non-Operator. (s/d)
AR-101547
Purchase and Sale Agreement dated November
15, 1982, between Conoco Inc. and Petro-Lewis
East Texas Field Corporation. (s/d)
Tooke "A" None 23.1 acres, more or less, out of
413013800 Small Royalty the W. G. Painter Survey, Gregg AR-101548
.0014% RI Interest County, Texas, being same lands Joint Operating Agreement dated January 1,
D. O. 42-183-031066 described as Second Tract in 1983, by and between Conoco Inc. and
Assignment dated July 6, 1931, Petro-Lewis Corporation. (s/d)
Recorded in Volume 119, Page 217
of Deed Records of Gregg County, AR-101580
Texas Like-Kind Exchange Agreement dated June 1,
1992, by and between Atlantic Richfield
Company and Conoco Inc. (s/d)
Assignment and Bill of Sale dated February
17, 1989, by and between Conoco and Gene
Powell Investments Inc. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 55 of 165
<PAGE> 82
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Willow Springs Field 42-183-004015-00A Ross Young, Guardian Gulf Production 1-31-31 67 531
(Cotton Valley) of the Estate of Company
A. L. Bacle Gas Unit (d) Lillian Green, et al
416326501
1.839164% ORRI
42-183-004015-00B Arrenva Bacle B. A. Skipper 4-25-30 4 392
42-183-004015-00C C. G. Glasscock Gulf Production 11-21-31 115 231
Company
42-183-004015-00D Rosa V. Glasscock, Gulf Production 11-21-31 115 226
et vir Company
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field None Unknown Unknown --- --- ---
A. V. Bacle
416856100
D.O. 42-183-030910-000
Operator
Robinett Resources, Inc.
0.530749% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Willow Springs Field 42-183-004015-00A A tract of land out of the G. W. AR-95702-004
(Cotton Valley) Hooper Survey, Gregg County, Declaration of Unitization and Designation of
A. L. Bacle Gas Unit (d) Texas, containing 30.0 acres more the A. L. Bacle Gas Unit, recorded in Volume
416326501 or less, and more particularly 2599, Page 256, Deed Records, Gregg Co.,
1.839164% ORRI described in that certain Oil and Texas. (d)
Gas Lease dated January 31, 1931,
recorded in Volume 67, Page 531, AR-95702
Deed Records, Gregg County, Texas. Farmout Agreement dated February 13, 1990 by
and between Atlantic Richfield Company and C
42-183-004015-00B A tract of land out of the G. W. W Resources, Inc. (d)
Hooper Survey, Gregg County,
Texas, containing 30.0 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated April 25, 1930,
recorded in Volume 4, Page 392,
Deed Records, Gregg County, Texas.
42-183-004015-00C A tract of land out of the G. W.
Hooper Survey, Gregg County,
Texas, containing 30.0 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated November 21,
1931, recorded in Volume 115,
Page 231, Deed Records, Gregg
County, Texas.
42-183-004015-00D A tract of land out of the G. W.
Hooper Survey, Gregg County,
Texas, containing 30.0 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated November 21,
1931, recorded in Volume 115,
Page 226, Deed Records, Gregg
County, Texas.
- --------------------------- --------------------- ----------------------------------- ----------------------------------------------
East Texas Field None 7.32 acres, more or less, in the
A. V. Bacle D. Sanches Survey, A-186, Gregg
416856100 County, Texas
D.O. 42-183-030910-000
Operator
Robinett Resources, Inc.
0.530749% RI
</TABLE>
Page 56 of 165
<PAGE> 83
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field None Unknown Unknown --- --- ---
R. Christian
412225900
D.O. 42-183-031172-000
Operator
0.56020% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field No Info. No Info. No Info. --- --- ---
Flemister
413521100
D.O. 42-183-030960-000
Operator
M-C Production & Drilling
Company, Inc.
0.005900% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field No Info. No Info. No Info. --- --- ---
F. C. Christian
415345600
D.O. 42-183-030973-000
Operator
Mustang Operating Company
0.196700% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field No Info. No. Info. No. Info. --- --- ---
Dallas Caldwell
416348100
D.O. 42-183-018493-000
Operator
N. P. Powell Estate
0.013146% RI
East Texas Field No Info. No Info. No Info. --- --- ---
Caddie Fisher
415322700
D.O. 42-183-018494-000
Operator
N. P. Powell Estate
0.026292% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field None 27 acres, more or less, out of
R. Christian the G. W. Hooper Survey, Gregg
412225900 County, Texas
D.O. 42-183-031172-000
Operator
0.56020% RI
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field No Info. 45 acres, more or less, located in
Flemister the G. W. Hooper Survey, Gregg
413521100 County, Texas
D.O. 42-183-030960-000
Operator
M-C Production & Drilling
Company, Inc.
0.005900% RI
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field No Info. 23.2 acres, more or less, out of
F. C. Christian the G. W. Hooper Survey, Gregg
415345600 County, Texas
D.O. 42-183-030973-000
Operator
Mustang Operating Company
0.196700% RI
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field No Info. 51.34 acres, more or less, out of
Dallas Caldwell a 79.09 acre tract in the John
416348100 Ruddle Survey, Gregg County, Texas
D.O. 42-183-018493-000
Operator
N. P. Powell Estate
0.013146% RI
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field No Info. 65.65 acres, more or less, being
Caddie Fisher the East 65.65 acres out of a
415322700 148.71 acre tract in the John
D.O. 42-183-018494-000 Ruddle Survey, Gregg County, Texas
Operator
N. P. Powell Estate
0.026292% RI
</TABLE>
Page 57 of 165
<PAGE> 84
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field Unkn Unkn Unkn --- --- ---
S. Carr "A"
413269600
D.O. 42-183-018432-000
Operator
CNS Enrgy
.13021% RI
East Texas Field Unkn. Unkn. Unkn. --- -- ---
S. Carr "B"
418573100
D.O. 42-183-018433-000
Operator
Mustang Operating
.13021% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field Unkn. Unkn. Unkn. --- --- ---
J. A. Whitaker
415368500
D.O. 42-183-018472-000
Operator
4-Sight Operating Company
.015479% RI
J. A. Whitaker -A- Unkn. Unkn. Unkn. --- --- ---
414564000
D. O. 42-183-018478-000
Operator Unknown
.015479% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field
M. Lemaire (Small RI)
418989200
.0391%
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field Unkn West 2/3 of South acres of the
S. Carr "A" Sam Carr 112 acre tract, situated
413269600 in M. McCurry Survey, based on
D.O. 42-183-018432-000 Csghd Gas Contract between A. R.
Operator Dillard, as Seller, and Sinclair,
CNS Enrgy as Buyer, dated 7/27/1938, Gregg
.13021% RI County, Texas
East Texas Field Unkn.
S. Carr "B" North 16.5 acres of South 33
418573100 acres of North 100 acres of Sam
D.O. 42-183-018433-000 Carr 112 acre tract situated in
Operator M. McCurry Survey, based on Csghd
Mustang Operating Gas Contract between A. R.
.13021% RI Dillars as Seller and Sinclair as
Buyer dated 7/27/1938, Gregg
County, Texas
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field Unkn. N 1/4 of the East 4/14 of a 100
J. A. Whitaker acre tract out of the Charles
415368500 Alexander Survey A-10, Gregg
D.O. 42-183-018472-000 County, Texas
Operator
4-Sight Operating Company
.015479% RI
J. A. Whitaker -A- Unkn.
414564000 N/2 of the South 3/4 of the East
D. O. 42-183-018478-000 4/14 of a 100 acre tract out of
Operator Unknown the Charles Alexander Survey
.015479% RI A-10, Gregg County, Texas
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 25.84 acres out of the H.
M. Lemaire (Small RI) Hathaway Survey, Gregg County,
418989200 Texas
.0391%
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
</TABLE>
Page 58 of 165
<PAGE> 85
EXHIBIT "A"
ATTACHED TO AND MADE A PART OF THAT CERTAIN PURCHASE AND SALE AGREEMENT DATED
EFFECTIVE AS OF OCTOBER 1, 1999, BY AND BETWEEN ATLANTIC RICHFIELD COMPANY
(ARCO) AND FUTURE ACQUISITION 1995, LTD. (PURCHASER)
IN ADDITION TO ANY OTHER DEPTH LIMITATIONS EXPRESSED HEREIN, IT IS THE EXPRESS
INTENTION TO LIMIT THE DESCRIPTIONS OF ARCO'S INTEREST (IF ANY), FROM THE
SURFACE DOWN TO THE BASE OF THE DEEPEST PRODUCING FORMATION
RUSK COUNTY
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056611-000 Abe Holt and Mary W. P. Chandler 9-10-30 150 153
Abe Holt (s) Holt, et al
416666300
100% WI
71.0227% NRI
Abe Holt "B" (s)
414231400
100% WI
87.5% NRI
South Kilgore Unit (s)
417539500
97.659398% WI
83.460188% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056611-000 A tract of land out of the Daniel AR-105213
Abe Holt (s) Clark Survey, Rusk County, Texas, Acreage Exchange Agreement dated effective
416666300 containing 68.84 acres more or April 1, 1995 by and between Paloma Partners,
100% WI less, and more particularly Ltd. and Atlantic Richfield Company. (s)
71.0227% NRI described in that certain Oil and
Gas Lease dated September 10, AR-105265-000
Abe Holt "B" (s) 1930, recorded in Volume 150, Purchase and Sale Agreement dated October 6,
414231400 Page 153, Deed Records, Rusk 1995 by and between East Texas Gathering
100% WI County, Texas. Company, Atlantic Richfield Company, Sun Pipe
87.5% NRI Line Company and Sun Company, Inc. (s)
ONLY INSOFAR AS THE LEASE COVERS
South Kilgore Unit (s) THE RIGHTS FROM THE SURFACE TO AR-105265-001
417539500 THE WOODBINE FORMATION AND Crude Oil Buy/Sell Contract dated effective
97.659398% WI PREFERENTIAL RIGHTS BELOW THE December 1, 1995 by and between ARCO Permian
83.460188% NRI BASE OF THE WOODBINE UNDER THE and Sun Company, Inc. (s)
ABE HOLT "B" ONLY.
AR-105875
South Kilgore Unit and Unit Operating
Agreement dated effective May 1, 1997,
Atlantic Richfield Company, Operator. (s)
AR-105229
Salt Water Agreement
Permanent Water Contract dated September 25,
1935 from Mattie Bean to J. Beren.
Permanent Water Contract dated November 12,
1935 from Mattie Bean to J. Beren.
Permanent Water Contract dated June 3, 1936
from Mary Holt to J. Beren (AR-105230-001,
002 and 003) (s)
AR-105228
Farmout Agreement dated May 11, 1932 by and
between Max Rubin, J. Beren and Shell
Petroleum Corporation. (s)
</TABLE>
Page 59 of 165
<PAGE> 86
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Continued from above Continued from above Continued from above Continued from above Continued from above
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
<S> <C> <C> <C>
Continued from above Continued from above Continued from above AR-105414-001
Operating Agreement dated effective June 1,
1980 by and between Gibson Drilling Company,
Operator, and James H. Merritt, et al,
Non-Operator. (s)
AR-105583
Longview Gas Plant Gas Purchase Contract
dated November 1, 1997 by and between ARCO
Permian, Seller, and ARCO Permian, Buyer,
amended August 25, 1998. (s/d)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 60 of 165
<PAGE> 87
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056616-00A C. O. Christian, Jr. Bargo Energy Company 5-19-94 1875 686
C. O. Christian "B" (s)
412795100
100% WI
80.0% NRI
South Kilgore Unit (s) 42-401-056616-00B Doris Christian Rea Bargo Energy Company 5-19-94 1875 684
417539500
97.659398% WI
83.460188% NRI
42-401-056616-00C Randall G. Rea, IE of Bargo Energy Company 5-19-94 1872 629
the Estate of Patsy
C. McCrory
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000861-000 Wildman Petroleum Argo Royalty Company 1-30-32 212 173
Christian "C" (Mineral Deed) Corporation
#24202 (28667-000)
410495100
.3906% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056616-00A A tract of land out of the Daniel AR-105213
C. O. Christian "B" (s) Clark Survey, Rusk County, Texas, Acreage Exchange Agreement dated effective
412795100 containing 64.5 acres more or April 1, 1995 by and between Paloma Partners,
100% WI less, and more particularly Ltd. and Atlantic Richfield Company. (s)
80.0% NRI described in that certain
Memorandum of Oil and Gas Lease AR-105875
dated May 19, 1994, recorded in South Kilgore Unit and Unit Operating
Volume 1875, Page 686, Deed Agreement dated effective May 1, 1997,
Records, Rusk County, Texas. Atlantic Richfield Company, Operator. (s)
ONLY INSOFAR AS LEASES COVER AR-105583
RIGHTS FROM THE SURFACE TO THE Longview Gas Plant Gas Purchase Contract
BASE OF THE WOODBINE FORMATION. dated November 1, 1997 by and between ARCO
Permian, Seller, and ARCO Permian, Buyer,
South Kilgore Unit (s) 42-401-056616-00B A tract of land out of the Daniel amended August 25, 1998. (s/d)
417539500 Clark Survey, Rusk County, Texas,
97.659398% WI containing 64.5 acres more or Private Radio License from Federal
83.460188% NRI less, and more particularly Communications Commission to ARCO
described in that certain Communications, Inc., dated December 16,
Memorandum of Oil and Gas Lease 1992, File No. 0000000319451, Call Sign
dated May 19, 1994, recorded in KNEP883, Frequency 154.47875 MHZ
Volume 1875, Page 684, Deed
Records, Rusk County, Texas.
ONLY INSOFR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
42-401-056616-00C A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 64.5 acres more or
less, and more particularly
described in that certain
Memorandum of Oil and Gas Lease
dated May 19, 1994, recorded in
Volume 1872, Page 629, Deed
Records, Rusk County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
East Texas Field 42-401-000861-000 A tract of land being a part of Oil, Gas and Mineral Lease dated December 18,
Christian "C" (Mineral Deed) the W. W. Simms Survey, Rusk 1930 recorded in Volume 157, Page 583, Deed
#24202 (28667-000) County, Texas, and more Records, Rusk County, Texas.
410495100 particularly described by metes
.3906% RI and bounds in that certain
Mineral Deed dated January 30,
1932, recorded in Volume 212,
Page 173, Deed Records, Rusk
County, Texas.
</TABLE>
Page 61 of 165
<PAGE> 88
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056697-00A Drayton Jones and R. H. Sowell 12-19-30 164 49
Jones, D. /Merrit-Jones (s) 42-401-056698-00A wife, Dora Jones;
418840300 Lillie Roberson, and
83.125% WI husband, Hosea
72.7343% NRI Roberson; Opal Gene
Givens; Venia Sherow
D. Jones/Tallal-Jones (s) and husband, Thordia
4188501000 Sherow; Jessie
100.0% WI Blackman, wife of
75.0% NRI Tootsom Blackman,
Deceased
South Kilgore Unit (s)
417539500 42-401-056697-00B Opal Gene Givens, a B. G.Beckam 2-6-31 181 1
97.659398% WI 42-401-056698-00B feme sole, and T. J.
83.460188% NRI Givens
42-401-056697-00C Opal Gene Givens, a J. H. Merritt 8-14-35 271 436
42-401-056698-00C feme sole, and T. J.
Givens
42-401-056697-00D E. W. Merritt 10-20-34 257 144
42-401-056698-00D Oscar Askew
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056697-00A A tract of land out of the Daniel AR-105414-001
Jones, D. /Merrit-Jones (s) 42-401-056698-00A Clark Survey, A-162, Rusk County, Operating Agreement dated effective June 1,
418840300 Texas, containing 13.72 acres 1980 by and between Gibson Drilling Company,
83.125% WI more or less, and more Operator, and James H. Merritt, et al,
72.7343% NRI particularly described in Non-Operator. (s)
Leasehold Partition dated 2-6-35
D. Jones/Tallal-Jones (s) as tracts 2, 3 & 4 recorded Vol. AR-105875
4188501000 262, Page 52, Deed Records, Rusk South Kilgore Unit and Unit Operating
100.0% WI County, Texas. Agreement dated effective May 1, 1997,
75.0% NRI Atlantic Richfield Company, Operator. (s)
AR-105583
South Kilgore Unit (s) 42-401-056697-00B A tract of land out of the Daniel Longview Gas Plant Gas Purchase Contract
417539500 42-401-056698-00B Clark Survey, A-162, Rusk County, dated November 1, 1997 by and between ARCO
97.659398% WI Texas, containing 13.72 acres Permian, Seller, and ARCO Permian, Buyer,
83.460188% NRI more or less, and more amended August 25, 1998. (s/d)
particularly described in
Leasehold Partition dated 2-6-35 Private Radio License from Federal
as tracts 2, 3 & 4 recorded Vol. Communications Commission to ARCO
262, Page 52, Deed Records, Rusk Communications, Inc., dated December 16,
County, Texas. 1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
42-401-056697-00C A tract of land out of the Daniel
42-401-056698-00C Clark Survey, A-162, Rusk County,
Texas, containing 13.72 acres
more or less, and more
particularly described in
Leasehold Partition dated 2-6-35
as tracts 2, 3 & 4 recorded Vol.
262, Page 52, Deed Records, Rusk
County, Texas.
42-401-056697-00D A tract of land out of the Daniel
42-401-056698-00D Clark Survey, A-162, Rusk County,
Texas, containing 13.72 acres
more or less, and more
particularly described in
Leasehold Partition dated 2-6-35
as tracts 2, 3 & 4 recorded Vol.
262, Page 52, Deed Records, Rusk
County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION
</TABLE>
Page 62 of 165
<PAGE> 89
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056697-00E Opal Gene Givens, a J. H. Merrit 9-24-34 254 607
Jones, D. /Merrit-Jones (s) 42-401-056698-00E feme sole, and T. J.
418840300 Givens
D. Jones/Tallal-Jones (s)
4188501000
South Kilgore Unit (s)
417539500 42-401-056697-00F Oscar Smith and wife, J. H. Merritt 11-30-35 276 495
(continued) 42-401-056698-00F Opal Gene Smith,
formerly Opal Gene
Givens
42-401-056697-00G G. W. Morgan, et al R. H. Sowell 7-9-36 293 351
42-401-056698-00G
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-006262-000 D.F. Giles, et al Van McPhail 9-9-30 151 542
Giles "C" Well No. 1-C (s)
41081161C
12.5% ORRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000858-000 Ralph A. Johnston Argo Royalty Company 10-6-31 189 355
J. F. Mason (21) (Mineral Deed)
410762400
1.3540% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ---------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056697-00E A tract of land out of the Daniel
Jones, D. /Merrit-Jones (s) 42-401-056698-00E Clark Survey, A-162, Rusk County,
418840300 Texas, containing 13.72 acres
more or less, and more
D. Jones/Tallal-Jones (s) particularly described in
4188501000 Leasehold Partition dated 2-6-35
as tracts 2, 3 & 4 recorded Vol.
South Kilgore Unit (s) 262, Page 52, Deed Records, Rusk
417539500 County, Texas.
(continued)
42-401-056697-00F A tract of land out of the Daniel
42-401-056698-00F Clark Survey, A-162, Rusk County,
Texas, containing 13.72 acres
more or less, and more
particularly described in
Leasehold Partition dated 2-6-35
as tracts 2, 3 & 4 recorded Vol.
262, Page 52, Deed Records, Rusk
County, Texas.
42-401-056697-00G A tract of land out of the Daniel
42-401-056698-00G Clark Survey, A-162, Rusk County,
Texas, containing 13.72 acres
more or less, and more
particularly described in
Leasehold Partition dated 2-6-35
as tracts 2, 3 & 4 recorded Vol.
262, Page 52, Deed Records, Rusk
County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-401-006262-000 Two tracts of land out of the M.
Giles "C" Well No. 1-C (s) J. Pru Survey, Rusk County,
41081161C Texas, containing 121 acres more
12.5% ORRI or less, and more particularly
described in that certain Oil and
Gas Lease dated September 9,
1930, recorded in Volume 151,
Page 542, Deed Records, Rusk
County, Texas.
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-401-000858-000 A tract of land out of the J. B. Oil, Gas and Mineral Lease dated October 31,
J. F. Mason (21) (Mineral Deed) Cadena League, Rusk County, 1929, recorded in Volume 140, Page 600, Deed
410762400 Texas, and more particularly Records, Rusk County, Texas.
1.3540% RI described in that certain Mineral
Deed dated October 6, 1931,
recorded in Volume 189, Page 355,
Deed Records, Rusk County, Texas.
</TABLE>
Page 63 of 165
<PAGE> 90
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Jared Field 42-401-000051-001 W. H. McCord, et ux, R. M. Weaver, Jr. 11-2-29 145 301
(Rodessa) Mary E. (Lizzie)
J. M. Price #1 (d) McCord
415719200
0.2538% ORRI
Let Field
(Travis Peak)
Mason Heirs #1 (d)
415031700
1.565% RI
17.5% ORRI BPO
20.0% ORRI APO
Jared Field
(Rodessa)
Mason #1 Gas Unit (d)
415029500
1.565% RI
17.5% ORRI BPO
20.0% ORRI APO
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000851-000 James C. Nelson Argo Royalty Company 2-6-31 167 381
J. R. Beall (Mineral Deed)
410433100
.3906% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Jared Field 42-401-000051-001 A tract of land out of the Juana AR-95707
(Rodessa) Berger DeCadena League, Rusk Farmout Agreement dated April 3, 1990 by and
J. M. Price #1 (d) County, Texas, and more between Atlantic Richfield Company and Gene
415719200 particularly described in that Powell Investments, Inc.
0.2538% ORRI certain Oil and Gas Lease dated
November 2, 1929, recorded in AR-100503
Let Field Volume 145, Page 301, Deed Limited Sublease of Oil, Gas and Mineral
(Travis Peak) Records, Rusk County, Texas. Lease dated March 13, 1992 by and between
Mason Heirs #1 (d) Atlantic Richfield Company and Triple J
415031700 Investments, Inc. recorded in Volume 1769,
1.565% RI Page 759, Land Records, Rusk County, Texas.
17.5% ORRI BPO (d)
20.0% ORRI APO
AR-101621
Jared Field Purchase and Sale Agreement effective January
(Rodessa) 1, 1993 by and between Atlantic Richfield
Mason #1 Gas Unit (d) Company and Madera Production Company. (s)
415029500
1.565% RI AR-95707
17.5% ORRI BPO Farmout Agreement dated April 3, 1990 by and
20.0% ORRI APO between Atlantic Richfield Company and Gene
Powell Investments, Inc. (d)
Unit Declaration filed April 12, 1990 in
Volume 1684, Page 307, Deed Records, Rusk
County, Texas
(J.M. Price #1) (d)
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
East Texas Field 42-401-000851-000 A tract of land out of the Wm. P.
J. R. Beall (Mineral Deed) Chisum Survey, Gregg and Rusk
410433100 Counties, Texas, containing 180
.3906% RI acres more or less, and more
particularly described by metes
and bounds in that certain
Mineral Deed dated February 6,
1931, recorded in Volume 167,
Page 381, Deed Records, Rusk
County, Texas.
</TABLE>
Page 64 of 165
<PAGE> 91
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056617-00A Bessie M. & Booker T. Natural Petroleum 11-17-34 257 344
John Henderson (s) Mayfield, husband and Company
417778900 wife
100% WI
87.500% NRI
South Kilgore Unit (s)
417539500
97.659398% WI 42-401-056617-00B Minnie Holt, joined Natural Petroleum 11-17-34 257 327
83.460188% NRI by her husband, Lovie Company
Holt; John Henderson;
Bennie M. Henderson;
Albert Henderson;
Arlena Henderson, a
feme sole
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000853-000 M. C. DeGuerin and Argo Royalty Company 5-1-31 171 630
M. C. DeGuerin (22) (Mineral Deed) wife, Mrs. Maude
410533800 DeGuerin
1.5625% RI
M. C. DeGuerin
417260400
1.5625% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056617-00A A tract of land, containing 50 AR-105213
John Henderson (s) acres more or less, out of the Acreage Exchange Agreement dated effective
417778900 Daniel Clark Survey, A-162, Rusk April 1, 1995 by and between Paloma Partners,
100% WI County, Texas, and more Ltd. and Atlantic Richfield Company. (s)
87.500% NRI particularly described by metes
and bounds in Oil and Gas Lease AR-105583
South Kilgore Unit (s) dated November 17, 1934, recorded Longview Gas Plant Gas Purchase Contract
417539500 in Volume 257, Page 344, Deed dated November 1, 1997 by and between ARCO
97.659398% WI Records, Rusk County, Texas. Permian, Seller, and ARCO Permian, Buyer.
83.460188% NRI (s/d)
42-401-056617-00B A tract of land out of the Daniel
Clark Survey, A-162, Rusk County, AR-105265-001
Texas, and more particularly Crude Oil Buy/Sell Contract dated effective
described by metes and bounds in December 1, 1995 by and between ARCO Permian
Oil and Gas Lease dated November and Sun Company, Inc. (s)
17, 1934, recorded in Volume 257,
Page 327, Deed Records, Rusk AR-105265-000
County, Texas. Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
ONLY INSOFAR AS LEASES COVER THE Company, Atlantic Richfield Company, Sun Pipe
RIGHTS FROM THE SURFACE TO THE Line Company and Sun Company, Inc. (s)
BASE OF THE WOODBINE FORMATION.
AR-105875
South Kilgore Unit and Unit Operating
Agreement dated effective May 1, 1997,
Atlantic Richfield Company, Operator. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
- --------------------------- ---------------------- ----------------------------------- ---------------------------------------------
East Texas Field 42-401-000853-000 A tract of land being a part of
M. C. DeGuerin (22) (Mineral Deed) the J. B. Cadena League, Rusk
410533800 County, Texas, containing 158.0
1.5625% RI acres more or less, and being
more particularly described in
M. C. DeGuerin that certain Deed dated May 1,
417260400 1931, recorded in Volume 171,
1.5625% RI Page 630, Deed Records, Rusk
County, Texas.
</TABLE>
Page 65 of 165
<PAGE> 92
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056618-000 Major Kennedy, et ux G. W. Hindman 9-13-30 152 259
M. Kennedy (s)
417535200
100% WI
87.50% NRI
South Kilgore Unit (s)
417539500
97.659398% WI
83.460188% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056618-000 A tract of land out of the Daniel AR-105213
M. Kennedy (s) Clark Survey, Rusk County, Texas, Exchange Agreement dated April 20, 1995 by
417535200 containing 20.0 acres more or and between Atlantic Richfield Company and
100% WI less, and more particularly Paloma Partners, Ltd. (s)
87.50% NRI described in that certain Oil and
Gas Lease dated September 13, AR-33093
South Kilgore Unit (s) 1930, recorded in Volume 152, Electric Service Contract dated June 24, 1969
417539500 Page 259, Deed Records, Rusk by and between Southwestern Electric Power
97.659398% WI County, Texas. Company and Atlantic Richfield Company. (s)
83.460188% NRI
ONLY INSOFAR AS THE LEASE COVERS AR-64597
THE RIGHTS FROM THE SURFACE DOWN Salt Water Disposal Agreement dated June 28,
TO THE BASE OF THE WOODBINE 1982, by and between ARCO Oil and Gas Company
FORMATION. and East Texas Salt Water Disposal Company.
Agreement dated December 14, 1992 and
recorded in Volume 1838, Page 787, Deed
Records, Rusk County, Texas., by and between
M.A.S. Operators Company and I. B. Beren.
AR-105583
Longview Gas Plant Gas Purchase Contract
dated November 1, 1997 by and between ARCO
Permian, Seller, and ARCO Permian, Buyer,
amended August 25, 1998. (s/d)
AR-105875
South Kilgore Unit and Unit Operating
Agreement dated effective May 1, 1997,
Atlantic Richfield Company, Operator. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 66 of 165
<PAGE> 93
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-000045-001 Major Kennedy, et ux R. W. Weaver, Jr. 10-7-30 152 399
Major Kennedy "B" (s)
414492900
100% WI
87.5% NRI
Major Kennedy "C" (s) 42-401-000045-001 Major Kennedy, et ux R. W. Weaver, Jr 10-7-30 152 399
414494500
100% WI
87.5% NRI
Major Kennedy "D" (s)
414496100
100% WI
87.5% NRI
South Kilgore Unit (s)
417539500
97.659398% WI
83.460188% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-000045-001 A tract of land out of the Daniel AR-105265-001
Major Kennedy "B" (s) Clark Survey, Rusk County, Texas, Crude Oil Buy/Sell Contract dated effective
414492900 containing 100 acres, more or December 1, 1995 by and between ARCO Permian
100% WI less, described as beginning at a and Sun Company, Inc. (s)
87.5% NRI point on the North line of said
Daniel Clark Susrvey, 3292' West AR-105265-000
of the NE/corner of said Survey; Purchase and Sale Agreement dated October 6,
Thence West with said survey line 1995 by and between East Texas Gathering
1306.5 vrs. to the NW/corner of Company, Atlantic Richfield Company, Sun Pipe
the Daniel Clark Survey; Thence Line Company and Sun Company, Inc. (s)
South with the West boundary line
of the survey 643'; Thence Eat Private Radio License from Federal
3,646'; Thence N 1 degrees E 643' Communications Commission to ARCO
to the place of beginning; being Communicatioins, Inc., dated December 16,
part of the same land conveyed by 1992, File No. 0000000319451, Call Sign
J. S. Bean, et ux to Major KNEP883, Frequency 154.47875 MHZ
Kennedy by deed dated 11/1/27,
recorded in Vol. 137, Page 265 of AR-105213
the Deed Records of Rusk County. Acreage Exchange Agreement dated effective
April 1, 1995 by and between Paloma Partners,
Ltd. and Atlantic Richfield Company. (s)
Major Kennedy "C" (s) 42-401-000045-001 A tract of land out of the Daniel
414494500 Clark Survey, Rusk County, Texas, AR-82521
100% WI containing 106.6 acres more or Casing Leak Allowable Transfer dated
87.5% NRI less, and more particularly effective October 1, 1986 by and between
described in that certain Oil and Atlantic Richfield Company and 4-Sight
Major Kennedy "D" (s) Gas Lease dated October 7, 1930, Operating Company, Inc. (s)
414496100 recorded in Volume 152, Page 399,
100% WI Deed Records, Rusk County, Texas. AR-82513
87.5% NRI Purchase and Sale Agreement dated effective
ONLY INSOFAR AS LEASE COVERS THE October 1, 1986 by and between Atlantic
South Kilgore Unit (s) RIGHTS FROM THE SURFACE TO THE Richfield Company and 4-Sight Operating
417539500 BASE OF THE WOODBINE FORMATION Company, Inc. (s)
97.659398% WI
83.460188% NRI AR-105875
South Kilgore Unit and Unit Operating
Agreement dated effective May 1, 1997,
Atlantic Richfield Company, Operator. (Except
Major Kennedy "B") (s)
AR-98412
Longview Gas Plant Gas Purchase Contract
dated January 1, 1997, by and between ARCO
Permian, Seller and ARCO Permian, Buyer, as
amended effective August 1, 1998 (applies to
Major Kennedy "B" only)
AR-105583
Longview Gas Plant Gas Purchase Contract
dated November 1, 1997 by and between ARCO
Permian, Seller, and ARCO Permian, Buyer,
amended August 25, 1998. (s/d)
</TABLE>
Page 67 of 165
<PAGE> 94
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-000045-00B G. W. Morgan Sinclair Oil Corp. 5-29-39 330 633
Major Kennedy "C" (s)
414494500
100% WI
87.5% NRI
South Kilgore Unit (s)
417539500
97.659398% WI 42-401-000045-00C Savannah Butts, Webb Kennedy 5-29-39 329 367
83.460188% NRI et vir Levy Butts
42-401-000045-00D Emma Montgomery, Webb Kennedy 5-29-39 329 370
et vir
42-401-000045-00E Arthur Kennedy Webb Kennedy 5-29-39 329 365
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-000045-00B A tract of land out of the Daniel AR-105265-001
Major Kennedy "C" (s) Clark Survey, Gregg County, Crude Oil Buy/Sell Contract dated effective
414494500 Texas, containing 20.0 acres more December 1, 1995 by and between ARCO Permian
100% WI or less, and more particularly and Sun Company, Inc. (s)
87.5% NRI described in that certain Oil and
Gas Lease dated May 29, 1939, AR-105265-000
South Kilgore Unit (s) recorded in Volume 330, Page 633, Purchase and Sale Agreement dated October 6,
417539500 Deed Records, Rusk County, Texas. 1995 by and between East Texas Gathering
97.659398% WI Company, Atlantic Richfield Company, Sun Pipe
83.460188% NRI 42-401-000045-00C A tract of land out of the Daniel Line Company and Sun Company, Inc. (s)
Clark Survey, Gregg County,
Texas, containing 20.0 acres more AR-105213
or less, and more particularly Acreage Exchange Agreement dated effective
described in that certain Oil and April 1, 1995 by and between Paloma Partners,
Gas Lease dated May 29, 1939, Ltd. and Atlantic Richfield Company. (s)
recorded in Volume 329, Page 367,
Deed Records, Rusk County, Texas. AR-82513
Purchase and Sale Agreement dated effective
42-401-000045-00D A tract of land out of the Daniel October 1, 1986 by and between Atlantic
Clark Survey, Gregg County, Richfield Company and 4-Sight Operating
Texas, containing 20.0 acres more Company, Inc. (s)
or less, and more particularly
described in that certain Oil and AR-82521
Gas Lease dated May 29, 1939, Casing Leak Allowable Transfer effective
recorded in Volume 329, Page 370, October 1, 1986 by and between Atlantic
Deed Records, Rusk County, Texas. Richfield Company and 4-Sight Operating
Company, Inc. (s)
42-401-000045-00E A tract of land out of the Daniel
Clark Survey, Gregg County, Texas AR-105875
containing 20.0 acres more or Unit Agreement (South Kilgore Unit) dated
less, and more particularly effective May 1, 1997, Atlantic Richfield
described in that certain Oil and Company, Operator. (s)
Gas Lease dated May 29, 1939,
recorded in Volume 329, Page 365,
Deed Records, Rusk County, Texas. AR-105583
Longview Gas Plant Gas Purchase Contract
ONLY INSOFAR AS LEASES COVER THE dated November 1, 1997 by and between ARCO
RIGHTS FROM THE SURFACE TO THE Permian, Seller, and ARCO Permian, Buyer,
BASE OF THE WOODBINE FORMATION. amended August 25, 1998. (s/d)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 68 of 165
<PAGE> 95
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-025033-000 Nat B. Bean, et al J. E. Mowinckle 2-17-31 177 385
Mary B. Bean (s)
412270400
100% WI
87.5% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-025033-000 40.95 acres out of the Carlos AR-105265-001
Mary B. Bean (s) Bean 43.2 acre tract in the Jacob Crude Oil Buy/Sell Contract dated effective
412270400 Lewis Survey, Rusk County, Texas, December 1, 1995 by and between ARCO Permian
100% WI and more particularly described and Sun Company, Inc. (s)
87.5% NRI by metes and bounds in that
certain Oil, Gas and Mineral AR-105265-000
Lease dated February 17, 1931, Purchase and Sale Agreement dated October 6,
recorded in Volume 177, Page 385 1995 by and between East Texas Gathering
Deed Records, Rusk County, TX Company, Atlantic Richfield Company, Sun Pipe
Line Company and Sun Company, Inc. (s)
AR-101649
Pipe Line Operating Agreement dated April 7,
1993 between Atlantic Richfield Company,
Producer, and ARCO Pipe Line Company. (s)
AR-98412
Longview Gas Plant Gas Purchase Contract
dated January 1, 1997, by and between ARCO
Permian, seller and ARCO Permian, buyer, as
amended effective August 1, 1998 (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 69 of 165
<PAGE> 96
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-00A George Eason Bargo Energy Company 4-29-95 1915 100
Mayfield A (s)
415035000
62.50% WI
54.6876% NRI
South Kilgore Unit (s)
417539500
97.659398% WI 42-401-056612-00B Barbara J. Oxford Bargo Energy Company 4-29-95 1915 92
83.460188% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-00A A tract of land out of the Daniel AR-105875
Mayfield A (s) Clark Survey, Rusk County, Texas, South Kilgore Unit and Unit Operating
415035000 containing 10 acres more or less, Agreement dated effective May 1, 1997,
62.50% WI and more particularly described Atlantic Richfield Company, Operator. (s)
54.6876% NRI in that certain Oil and Gas Lease
dated April 29, 1995, recorded in AR-105265-000
South Kilgore Unit (s) Volume 1915, Page 100, Official Purchase and Sale Agreement dated October 6,
417539500 Public Records, Rusk County, 1995 by and between East Texas Gathering
97.659398% WI Texas. Company, Atlantic Richfield Company, Sun Pipe
83.460188% NRI Line Company and Sun Company, Inc. (s)
42-401-056612-00B A tract of land out of the Daniel
Clark Survey, Rusk County, Texas, AR-105265-001
containing 10 acres more or less, Crude Oil Buy/Sell Contract dated effective
and more particularly described December 1, 1995 by and between ARCO Permian
in that certain Oil and Gas Lease and Sun Company, Inc. (s)
dated April 29, 1995, recorded in
Volume 1915, Page 92, Official AR-105213
Public Records, Rusk County, Exchange Agreement dated April 20, 1995 by
Texas. and between Atlantic Richfield Company and
Paloma Partners, Ltd. (s)
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO Private Radio License from Federal
THE BASE OF THE WOODBINE Communications Commission to ARCO
FORMATION. Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 70 of 165
<PAGE> 97
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-00C Lois Freeman Bargo Energy Company 4-29-95 1913 819
Mayfield A (s)
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-00D Marcia Lou Braly Bargo Energy Company 4-29-95 1914 427
42-401-056612-00E Frank J. Budde, Ind. Bargo Energy Company 4-29-95 1913 816
And as Trustee of the
Frank and Marilyn
Budde Family Trust
42-401-056612-00F Thomas Mayfield Bargo Energy Company 4-29-95 1914 414
42-401-056612-00G Ruby Duvall Atchley Bargo Energy Company 4-29-95 1914 410
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-00C A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 10 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated April 29, 1995, recorded in
(continued) Volume 1913, Page 819, Official
Public Records, Rusk County,
Texas.
42-401-056612-00D A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1914, Page 427, Official
Public Records, Rusk County,
Texas.
42-401-056612-00E A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1913, Page 816, Deed
Records, Rusk County, Texas.
42-401-056612-00F A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1914, Page 414, Official
Public Records, Rusk County,
Texas.
42-401-056612-00G A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1914, Page 410, Official
Public Records, Rusk County,
Texas.
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO
THE BASE OF THE WOODBINE
FORMATION.
</TABLE>
Page 71 of 165
<PAGE> 98
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-00H Freya Jean Atchley Bargo Energy Company 4-29-95 1914 412
Mayfield A (s) Bolton
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-00I J. Mike Rowan Bargo Energy Company 5-17-95 1914 418
42-401-056612-00J Baton Corporation Bargo Energy Company 4-29-95 1914 423
42-401-056612-00K John J. Dozier Bargo Energy Company 4-29-95 1914 421
42-401-056612-00L Goodrich-Malloy Trust Atlantic Richfield 3-29-96 1964 542
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-00H A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 10 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated April 29, 1995, recorded in
(continued) Volume 1914, Page 412, Official
Public Records, Rusk County,
Texas.
42-401-056612-00I A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated May 17, 1995, recorded in
Volume 1914, Page 418, Official
Public Records, Rusk County,
Texas.
42-401-056612-00J A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1914, Page 423, Official
Public Records, Rusk County,
Texas.
42-401-056612-00K A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1914, Page 421, Official
Public Records, Rusk County,
Texas.
42-401-056612-00L A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 142.0 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated March 29, 1996,
recorded in Volume 1964, Page
542, Official Public Records,
Rusk County, Texas.
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO
THE BASE OF THE WOODBINE
FORMATION.
</TABLE>
Page 72 of 165
<PAGE> 99
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-00M Robert R. Goodrich Atlantic Richfield 5-16-96 1964 550
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-00N John F. Malloy, Ind. Atlantic Richfield 5-16-96 1964 557
And as Agent for John Company
Goodrich Malloy,
Margaret C. Malloy
and Paul Malloy
42-401-056612-00O Irvin J. Jaffe Bargo Energy Company 4-29-95 1915 94
42-401-056612-00P Sonya Faye Atchley Bargo Energy Company 4-29-95 1915 96
Morgan, et al
42-401-056612-00Q Sonya Faye Atchley Bargo Energy Company 4-29-95 1915 98
Morgan, et al
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-00M A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 107.0 acres more or
less, and more particularly
South Kilgore Unit (s) described in that certain Oil and
417539500 Gas Lease dated May 16, 1995,
(continued) recorded in Volume 1964, Page
550, Official Public Records,
Rusk County, Texas.
Only insofar as said lease covers
the rights from the surface to
the Base of the Woodbine
formation.
42-401-056612-00N A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 107.0 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated May 16, 1996,
recorded in Volume 1964, Page
557, Official Public Records,
Rusk County, Texas.
42-401-056612-00O A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1915, Page 94, Official
Public Records, Rusk County,
Texas.
42-401-056612-00P A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1915, Page 96, Official
Public Records, Rusk County,
Texas.
42-401-056612-00Q A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1915, Page 98, Official
Public Records, Rusk County,
Texas.
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO
THE BASE OF THE WOODBINE
FORMATION.
</TABLE>
Page 73 of 165
<PAGE> 100
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-00R Billie Jean Ashworth Bargo Energy Company 4-29-95 1917 110
Mayfield A (s)
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-00S Betty Jean Smith Bargo Energy Company 4-29-95 1917 125
42-401-056612-00T Myrtle V. Freeman, Bargo Energy Company 4-29-95 1917 114
Individually and as
Trustee
42-401-056612-00U Margaret M. Rivers Bargo Energy Company 4-29-95 1917 739
42-401-056612-00V Mrs. Marie W. Jaffe Bargo Energy Company 4-29-95 1917 119
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-00R A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 10 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated April 29, 1995, recorded in
(continued) Volume 1917, Page 110, Official
Public Records, Rusk County,
Texas.
42-401-056612-00S A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 125, Official
Public Records, Rusk County,
Texas.
42-401-056612-00T A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 114, Official
Public Records, Rusk County,
Texas.
42-401-056612-00U A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 739, Official
Public Records, Rusk County,
Texas.
42-401-056612-00V A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 119, Official
Public Records, Rusk County,
Texas.
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO
THE BASE OF THE WOODBINE
FORMATION.
</TABLE>
Page 74 of 165
<PAGE> 101
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-00W Lenox C. Ligon, Ind. Bargo Energy Company 5-16-95 1919 803
Mayfield A (s) And as IE of the
415035000 Estate of Faith
Carlton Brock,
South Kilgore Unit (s) Deceased
417539500
(continued)
42-401-056612-00X Beverly Heller Bargo Energy Company 4-29-95 1917 116
42-401-056612-00Y Herschel H. Jaffee Bargo Energy Company 4-29-95 1917 121
42-401-056612-00Z Kathleen Rasansky Bargo Energy Company 4-29-95 1917 123
42-401-056612-0AA Mrs. Louise Adelman Bargo Energy Company 4-29-95 1917 112
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-00W A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 10 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated May 16, 1995, recorded in
(continued) Volume 1919, Page 803, Official
Public Records, Rusk County,
Texas.
42-401-056612-00X A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 116, Official
Public Records, Rusk County,
Texas.
42-401-056612-00Y A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 121, Official
Public Records, Rusk County,
Texas.
42-401-056612-00Z A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 123, Official
Public Records, Rusk County,
Texas.
42-401-056612-0AA A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 112, Official
Public Records, Rusk County,
Texas.
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO
THE BASE OF THE WOODBINE
FORMATION.
</TABLE>
Page 75 of 165
<PAGE> 102
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0AB Leo Scull, Jr. Bargo Energy Company 6-12-95 1917 741
Mayfield A (s)
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0AC Pacific Enterprises Bargo Energy Company 6-1-95 1917 746
ABC Corporation
42-401-056612-OAD John Reese Mayfield Bargo Energy Company 4-29-95 1917 744
42-401-056612-OAE Linda Wheat Atlantic Richfield 9-23-97 2038 602
Company
42-401-056612-0AF Marie Donworth Bargo Energy Company 4-29-95 1920 330
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0AB A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 107 acres more or
less, and more particularly
South Kilgore Unit (s) described in that certain Oil and
417539500 Gas Lease dated June 12, 1995,
(continued) recorded in Volume 1917, Page
741, Official Public Records,
Rusk County, Texas.
42-401-056612-0AC A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated June 1, 1995, recorded in
Volume 1917, Page 746, Official
Public Records, Rusk County,
Texas.
42-401-056612-OAD A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated April 29, 1995, recorded in
Volume 1917, Page 744, Official
Public Records, Rusk County,
Texas.
42-401-056612-OAE A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 107 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated September 23,
1997, recorded in Volume 2038,
Page 602, Official Public
Records, Rusk County, Texas.
42-401-056612-0AF A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10.0 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated April 29, 1995,
recorded in Volume 1920, Page
330, Official Public Records,
Rusk County, Texas.
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO
THE BASE OF THE WOODBINE
FORMATION.
</TABLE>
Page 76 of 165
<PAGE> 103
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-OAG Robert Glassenberg Bargo Energy Company 4-29-95 1921 443
Mayfield A (s)
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0AH Lois Freeman Atlantic Richfield 10-27-96 1997 10
Company
42-401-056612-0AI Pacific Enterprises Atlantic Richfield 6-28-97 2027 316
ABC Corporation Company
42-401-056612-0AJ Myrtle V. Freeman, Atlantic Richfield 10-27-96 1999 655
Ind. And as Trustee Company
under the Will of
James Holman Freeman
42-401-056612-0AK Petco Limited Atlantic Richfield 12-6-96 1999 657
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-OAG A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 10 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated April 29, 1995, recorded in
(continued) Volume 1921, Page 443, Official
Public Records, Rusk County,
Texas.
ONLY INSOFAR AS SAID LEASES COVER
THE RIGHTS FROM THE SURFACE TO
THE BASE OF THE WOODBINE
FORMATION.
42-401-056612-0AH A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 27, 1996, recorded
in Volume 1997, Page 10, Official
Public Records, Rusk County,
Texas.
42-401-056612-0AI A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 107.0 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 28, 1997,
recorded in Volume 2027, Page 316
Official Public Records, Rusk
County, Texas.
42-401-056612-0AJ A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 27, 1996, recorded
in Volume 1999, Page 655,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AK A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated December 6, 1996, recorded
in Volume 1999, Page 657,
Official Public Records, Rusk
County, Texas.
</TABLE>
Page 77 of 165
<PAGE> 104
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0AL John Reese Mayfield Atlantic Richfield 10-27-96 1992 562
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0AM Marie Donworth Atlantic Richfield 10-27-96 1992 714
Company
42-401-056612-0AN Margaret M. Rivers Atlantic Richfield 12-3-96 1992 721
Company
42-401-056612-0AO George Eason Atlantic Richfield 10-27-96 1992 716
Company
42-401-056612-0AP Barbara J. Oxford Atlantic Richfield 10-30-96 1992 718
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0AL A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 132 acres more or
less, and more particularly
South Kilgore Unit (s) described in that certain Oil and
417539500 Gas Lease dated October 27, 1996,
(continued) recorded in Volume 1992, Page
562, Official Public Records,
Rusk County, Texas.
42-401-056612-0AM A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 27, 1996, recorded
in Volume 1992, Page 714,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AN A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 132 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated December 3, 1996,
recorded in Volume 1992, Page
721, Official Public Records,
Rusk County, Texas.
42-401-056612-0AO A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 27, 1996, recorded
in Volume 1992, Page 716,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AP A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 30, 1996, recorded
in Volume 1992, Page 718,
Official Public Records, Rusk
County, Texas.
</TABLE>
Page 78 of 165
<PAGE> 105
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0AQ Marcia L. Braly Atlantic Richfield 10-27-96 1992 711
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0AR Irvin J. Jaffe Atlantic Richfield 10-30-96 1987 143
Company
42-401-056612-0AS Thomas Mayfield Atlantic Richfield 10-27-96 1987 145
Company
42-401-056612-0AT Sonya Faye Atchley Atlantic Richfield 10-28-96 1987 147
Morgan, Ind., et al Company
42-401-056612-0AU Steven Lyle Morgan Atlantic Richfield 10-28-96 1987 149
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0AQ A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 97 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated October 27, 1996, recorded
(continued) in Volume 1992, Page 711,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AR A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 30, 1996, recorded
in Volume 1987, Page 143,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AS A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 27, 1996, recorded
in Volume 1987, Page 145,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AT A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 28, 1996, recorded
in Volume 1987, Page 147,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AU A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 28, 1996, recorded
in Volume 1987, Page 149,
Official Public Records, Rusk
County, Texas.
</TABLE>
Page 79 of 165
<PAGE> 106
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0AV Freya Jean Atchley Atlantic Richfield 10-28-96 1987 141
Mayfield A (s) Bolton and Cathy Ann Company
415035000 Bolton Gill
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0AW Bllie Jean Ashworth Atlantic Richfield 10-30-96 1987 139
Company
42-401-056612-0AX Louise Adelman Atlantic Richfield 10-27-96 1987 137
Company
42-401-056612-0AY Kathleen Rasansky Atlantic Richfield 10-30-96 1987 151
Company
42-401-056612-0AZ Maude Wagnon Rushing Atlantic Richfield 11-4-96 1987 153
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0AV A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 97 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated October 28, 1996, recorded
(continued) in Volume 1987, Page 141,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AW A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 30, 1996, recorded
in Volume 1987, Page 139,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AX A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 27, 1996, recorded
in Volume 1987, Page 137,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AY A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 30, 1996, recorded
in Volume 1987, Page 151,
Official Public Records, Rusk
County, Texas.
42-401-056612-0AZ A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 107 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 4, 1996,
recorded in Volume 1987, Page
153, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 80 of 165
<PAGE> 107
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0BA Robert Glassenberg Atlantic Richfield 10-27-96 1994 43
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0BB Beverly Heller Atlantic Richfield 10-27-96 1994 45
Company
42-401-056612-0BC Marie W. Jaffe Atlantic Richfield 1-8-97 1997 698
Company
42-401-056612-0BD Herschel H. Jaffe Atlantic Richfield 1-8-97 1997 700
Company
42-401-056612-0BE Carolyn Mayfield Atlantic Richfield 11-5-96 1997 702
Warfield Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0BA A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 97 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated October 27, 1996, recorded
(continued) in Volume 1994, Page 43, Official
Public Records, Rusk County,
Texas.
42-401-056612-0BB A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated October 27, 1996, recorded
in Volume 1994, Page 45, Official
Public Records, Rusk County,
Texas.
42-401-056612-0BC A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated January 8, 1997, recorded
in Volume 1997, Page 698,
Official Public Records, Rusk
County, Texas.
42-401-056612-0BD A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 97 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated January 8, 1997, recorded
in Volume 1997, Page 700,
Official Public Records, Rusk
County, Texas.
42-401-056612-0BE A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 107 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 5, 1996,
recorded in Volume 1997, Page
702, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 81 of 165
<PAGE> 108
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0BF Bertina Mayfield Hill Atlantic Richfield 11-5-96 1997 696
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0BG Sandra Mayfield Allen Atlantic Richfield 11-5-96 1997 694
Company
42-401-056612-0BH Richard Clouse Atlantic Richfield 1-30-97 2009 573
Company
42-401-056612-0BK Cole C. McCrory Atlantic Richfield 9-16-97 2050 137
Company
42-401-056612-0BL Patrick S. McCrory Atlantic Richfield 9-16-97 2050 139
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- -------------------------- -------------------- ---------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0BF A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 107 acres more or
less, and more particularly
South Kilgore Unit (s) described in that certain Oil and
417539500 Gas Lease dated November 5, 1996,
(continued) recorded in Volume 1997, Page
696, Official Public Records,
Rusk County, Texas.
42-401-056612-0BG A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 107 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 5, 1996,
recorded in Volume 1997, Page
694, Official Public Records,
Rusk County, Texas.
42-401-056612-0BH A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 31.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated January 30, 1997,
recorded in Volume 1997, Page
573, Official Public Records,
Rusk County, Texas.
42-401-056612-0BK A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated September 16, 1997,
recorded in Volume 2050, Page
137, Official Public Records,
Rusk County, Texas.
42-401-056612-0BL A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated September 16, 1997,
recorded in Volume 2050, Page
139, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 82 of 165
<PAGE> 109
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0BM C. O. Christian, Jr. Atlantic Richfield 9-16-97 2050 129
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0BN Doris C. Rea Atlantic Richfield 9-16-97 2050 140
Company
42-401-056612-0BO Don R. Lewis Atlantic Richfield 10-29-97 2046 8
Company
42-401-056612-0BP Darcus Palmer Atlantic Richfield 11-7-97 2044 787
Company
42-401-056612-0BQ Leo Scull, Jr. Atlantic Richfield 9-23-97 2043 595
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0BM A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 10 acres more or less,
and more particularly described
South Kilgore Unit (s) in that certain Oil and Gas Lease
417539500 dated September 16, 1997,
(continued) recorded in Volume 2050, Page
129, Official Public Records,
Rusk County, Texas.
42-401-056612-0BN A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 10 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated September 16, 1997,
recorded in Volume 2050, Page
140, Official Public Records,
Rusk County, Texas.
42-401-056612-0BO A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 142.0 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated October 29, 1997,
recorded in Volume 2046, Page 8,
Official Public Records, Rusk
County, Texas.
42-401-056612-0BP A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 11.07 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 7, 1997,
recorded in Volume 2044, Page
787, Official Public Records,
Rusk County, Texas.
42-401-056612-0BQ A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 108.66 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated September 23,
1997, recorded in Volume 2043,
Page 595, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 83 of 165
<PAGE> 110
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0BR Lois Lorine Gault Atlantic Richfield 9-15-97 2040 596
Mayfield A (s) Deborde Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0BS Davis Duke Gault Atlantic Richfield 10-23-97 2044 789
Company
42-401-056612-0BT Kathryn Bishop Atlantic Richfield 10-22-97 2042 822
Company
42-401-056612-0BU Eugene M. Massad and Atlantic Richfield 10-22-97 2044 784
Edmond M. Massad, Company
Trustee
42-401-056612-0BV Genevieve Day Fletcher Atlantic Richfield 11-19-97 2056 463
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0BR A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 107 acres more or
less, and more particularly
South Kilgore Unit (s) described in that certain Oil and
417539500 Gas Lease dated September 15,
(continued) 1997, recorded in Volume 2040,
Page 596, Official Public
Records, Rusk County, Texas.
42-401-056612-0BS A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 107 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated October 23, 1997,
recorded in Volume 2044, Page
789, Official Public Records,
Rusk County, Texas.
42-401-056612-0BT A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 100.56 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated October 22, 1997,
recorded in Volume 2042, Page
822, Official Public Records,
Rusk County, Texas.
42-401-056612-0BU A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 100.56 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated October 22, 1997,
recorded in Volume 2044, Page
784, Official Public Records,
Rusk County, Texas.
42-401-056612-0BV A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 28.0 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 19,
1997, recorded in Volume 2056,
Page 463, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 84 of 165
<PAGE> 111
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0BW James Depreist Atlantic Richfield 11-19-97 2056 461
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0BX Retha Fisher, Atlantic Richfield 11-19-97 2047 439
Individually and as Company
Independent Executrix
42-401-056612-0BY Lenora Sneed Oil Co. Atlantic Richfield 11-22-97 2047 442
Company
42-401-056612-0BZ Choctaw Energy Ltd. Atlantic Richfield 5-15-98 2078 784
Partners Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0BW A tract of land out of the Daniel
Mayfield A (s) Clark Survey, Rusk County, Texas,
415035000 containing 28.0 acres more or
less, and more particularly
South Kilgore Unit (s) described in that certain Oil and
417539500 Gas Lease dated November 19,
(continued) 1997, recorded in Volume 2056,
Page 461, Official Public
Records, Rusk County, Texas.
42-401-056612-0BX A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 28.0 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 19,
1997, recorded in Volume 2047,
Page 439, Official Public
Records, Rusk County, Texas.
42-401-056612-0BY A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 100.56 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 22,
1997, recorded in Volume 2047,
Page 442, Official Public
Records, Rusk County, Texas.
42-401-056612-0BZ A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 105.57 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated May 15, 1998,
recorded in Volume 2078, Page
784, Official Public Records,
Rusk County, Texas.
Only insofar as said lease covers
the rights from the surface to
the Base of the Woodbine
formation.
</TABLE>
Page 85 of 165
<PAGE> 112
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0CA George W. Dozier Atlantic Richfield 10-31-97 2081 590
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0CB Betty Jean Smith Atlantic Richfield 5-26-98 2081 624
Company
42-401-056612-0CC Louise Adelman Atlantic Richfield 5-21-98 2081 575
Company
42-401-056612-0CD Beverly Heller Atlantic Richfield 5-21-98 2081 595
Company
42-401-056612-0CE Kathleen Rasanky Atlantic Richfield 5-21-98 2081 614
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0CA A tract of land out of the Daniel
Mayfield A (s) Clark Survey, A-162, Rusk County,
415035000 Texas, containing 142.0 acres
more or less, and more
South Kilgore Unit (s) particularly described in that
417539500 certain Oil and Gas Lease dated
(continued) October 31, 1997, recorded in
Volume 2081, Page 590, Official
Public Records, Rusk County,
Texas.
42-401-056612-0CB A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 97 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 26, 1998,
recorded in Volume 2081, Page
624, Official Public Records,
Rusk County, Texas.
42-401-056612-0CC A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 35 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 21, 1998,
recorded in Volume 2081, Page
575, Official Public Records,
Rusk County, Texas.
42-401-056612-0CD A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 35 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 21, 1998,
recorded in Volume 2081, Page
595, Official Public Records,
Rusk County, Texas.
42-401-056612-0CE A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 35 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 21, 1998,
recorded in Volume 2081, Page
614, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 86 of 165
<PAGE> 113
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056612-0CF Lamar Mayfield Atlantic Richfield 11-3-97 2081 569
Mayfield A (s) Company
415035000
South Kilgore Unit (s)
417539500
(continued)
42-401-056612-0CG Jo Evelyn Simon, et al Atlantic Richfield 11-3-97 2081 566
Company
42-401-056612-0CH Ruth D. Sandifer Atlantic Richfield 5-20-98 2081 620
Company
42-401-056612-0CI Frank Hudson, Receiver Atlantic Richfield 8-7-98 2087 728
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056612-0CF Two tracts of land out of the
Mayfield A (s) Daniel Clark Survey, A-162, Rusk
415035000 County, Texas, containing 45
acres more or less, and more
South Kilgore Unit (s) particularly described in that
417539500 certain Oil and Gas Lease dated
(continued) November 3, 1997, recorded in
Volume 2081, Page 569, Official
Public Records, Rusk County,
Texas.
42-401-056612-0CG Two tracts of land out of the
Daniel Clark Survey, A-162, Rusk
County, Texas, containing 45
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
November 3, 1997, recorded in
Volume 2081, Page 566, Official
Public Records, Rusk County,
Texas.
42-401-056612-0CH Two tracts of land out of the
Daniel Clark Survey, A-162, Rusk
County, Texas, containing 45
acres more or less, and more
particularly described in that
certain Oil and Gas Lease dated
May 20, 1998, recorded in Volume
2081, Page 620, Official Public
Records, Rusk County, Texas.
42-401-056612-0CI A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 139.89 acres
more or less, and more
particularly described in that
certain Oil and Gas Lease dated
August 7, 1998, recorded in
Volume 2087, Page 728, Official
Public Records, Rusk County,
Texas.
</TABLE>
Page 87 of 165
<PAGE> 114
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056615-00A Betty Jo Peterson Bargo Energy Company 10-24-94 1889 277
Mayfield, S. E.
415040600
100.0% WI
81.25% NRI
South Kilgore Unit
417539500
42-401-056615-00B H. B. Pyle Atlantic Richfield 9-1-97 2042 493
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056615-00A A tract of land out of the Daniel AR-105875
Mayfield, S. E. Clark Survey, Rusk County, Texas, South Kilgore Unit and Unit Operating
415040600 containing 33.4 acres more or Agreement dated effective May 1, 1997,
100.0% WI less, and more particularly Atlantic Richfield Company, Operator. (s)
81.25% NRI described in that certain Oil and
Gas Lease dated October 24, 1994, AR-105583
South Kilgore Unit recorded in Volume 1889, Page Longview Gas Plant Gas Purchase Contract
417539500 277, Deed Records, Rusk County, dated November 1, 1997 by and between ARCO
Texas. Permian, Seller, and ARCO Permian, Buyer,
amended August 25, 1998. (s/d)
ONLY INSOFAR AS LEASE COVERS
RIGHTS FROM THE SURFACE TO THE Private Radio License from Federal
BASE OF THE WOODBINE FORMATION. Communications Commission to ARCO
Communications, Inc., dated December 16,
42-401-056615-00B A tract of land out of the Daniel 1992, File No. 0000000319451, Call Sign
Clark Survey, Rusk County, Texas, KNEP883, Frequency 154.47875 MHZ
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated September 1,
1997, recorded in Volume 2042,
Page 493, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 88 of 165
<PAGE> 115
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056615-00C Betty Springer Reeds Atlantic Richfield 8-15-96 1968 663
Mayfield, S. E. Company
415040600
South Kilgore Unit
417539500
(continued)
42-401-056615-00F Bettye V. Gray Bargo Energy Company 9-21-94 1910 608
42-401-056615-00G Rita Fay Garrett Bargo Energy Company 4-26-95 1913 821
42-401-056615-00H James W. Palmer Bargo Energy Company 8-29-94 1889 273
42-401-056615-00I Anita S. Anderson Atlantic Richfield 7-15-98 2084 634
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056615-00C A tract of land out of the Daniel
Mayfield, S. E. Clark Survey, Rusk County, Texas,
415040600 containing 33.4 acres more or
less, and more particularly
South Kilgore Unit described in that certain Oil and
417539500 Gas Lease dated August 15, 1996,
(continued) recorded in Volume 1968, Page
663, Official Public Records,
Rusk County, Texas. (ALL DEPTHS)
42-401-056615-00F A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated September 21,
1994, recorded in Volume 1910,
Page 608, Official Public
Records, Rusk County, Texas.
42-401-056615-00G A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated April 26, 1995,
recorded in Volume 1913, Page
821, Official Public Records,
Rusk County, Texas.
42-401-056615-00H A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated August 29, 1994,
recorded in Volume 1889, Page
273, Official Public Records,
Rusk County, Texas.
42-401-056615-00I A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.21 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated July 15, 1998,
recorded in Volume 2084, Page
634, Official Public Records,
Rusk County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
</TABLE>
Page 89 of 165
<PAGE> 116
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056615-00J Roy T. Anderson Atlantic Richfield 7-15-98 2084 637
Mayfield, S. E. Company
415040600
South Kilgore Unit
417539500
(continued)
42-401-056615-00K Mary Bell Cherry Steve J. Hughes 6-1-93 1871 642
42-401-056615-00L A. Roland Fisher Steve J. Hughes 6-10-94 1871 644
42-401-056615-00M Octavious Fisher Steve J. Hughes 6-1-94 1871 648
42-401-056615-00N James Depreist, sole Steve J. Hughes 12-22-93 1918 491
heir of Orphus Fisher
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056615-00J A tract of land out of the Daniel
Mayfield, S. E. Clark Survey, Rusk County, Texas,
415040600 containing 33.21 acres more or
less, and more particularly
South Kilgore Unit described in that certain Oil and
417539500 Gas Lease dated July 15, 1998,
(continued) recorded in Volume 2084, Page
637, Official Public Records,
Rusk County, Texas. (ALL DEPTHS)
42-401-056615-00K A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 1, 1993,
recorded in Volume 1871, Page
642, Official Public Records,
Rusk County, Texas.
42-401-056615-00L A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 10, 1994,
recorded in Volume 1871, Page
644, Official Public Records,
Rusk County, Texas.
42-401-056615-00M A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 1, 1994,
recorded in Volume 1871, Page
648, Official Public Records,
Rusk County, Texas.
42-401-056615-00N A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated December 22,
1993, recorded in Volume 1918,
Page 491, Official Public
Records, Rusk County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
</TABLE>
Page 90 of 165
<PAGE> 117
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056615-00O David S. Meredith, III Steve J. Hughes 6-1-93 1871 660
Mayfield, S. E.
415040600
South Kilgore Unit
417539500
(continued)
42-401-056615-00P Henry McGaughty Steve J. Hughes 6-1-93 1871 662
Meredith
42-401-056615-00Q Will Gordon Meredith Steve J. Hughes 6-1-93 1871 664
42-401-056615-00R Charles B. Ogden, III, Steve J. Hughes 6-1-93 1871 678
Individually and as
Agent for Donald W.
Driboll, et al
42-401-056615-00S Beverly S. Yocum Steve J. Hughes 7-12-93 1871 686
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056615-00O A tract of land out of the Daniel
Mayfield, S. E. Clark Survey, Rusk County, Texas,
415040600 containing 33.4 acres more or
less, and more particularly
South Kilgore Unit described in that certain Oil and
417539500 Gas Lease dated June 1, 1993,
(continued) recorded in Volume 1871, Page
660, Official Public Records,
Rusk County, Texas.
42-401-056615-00P A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 1, 1993,
recorded in Volume 1871, Page
662, Official Public Records,
Rusk County, Texas.
42-401-056615-00Q A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 1, 1993,
recorded in Volume 1871, Page
664, Official Public Records,
Rusk County, Texas.
42-401-056615-00R A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 1, 1993,
recorded in Volume 1871, Page
678, Official Public Records,
Rusk County, Texas.
42-401-056615-00S A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated July 12, 1993,
recorded in Volume 1871, Page
686, Official Public Records,
Rusk County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
</TABLE>
Page 91 of 165
<PAGE> 118
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056615-00T Jerry Powell and Bargo Energy Company 6-29-93 1871 682
Mayfield, S. E. Fannie Fletcher
415040600
South Kilgore Unit
417539500
(continued)
42-401-056615-00U Symonia Mayfield Steve J. Hughes 6-1-93 1871 680
Palmer
42-401-056615-00V Mrs. Jarrell Garzonzik Atlantic Richfield 3-1-97 2019 710
Company
42-401-056615-00W Liberty Bank and Atlantic Richfield 9-27-96 1997 12
Trust Company of Company
Tulsa, National
Association Trustee
of the M. P. Springer
B#3338 Trust
42-401-056615-00X Boatmen's Trust Atlantic Richfield 9-30-96 1997 7
Company of Arkansas, Company
Agent for Mann Heirs
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056615-00T A tract of land out of the Daniel
Mayfield, S. E. Clark Survey, Rusk County, Texas,
415040600 containing 33.4 acres more or
less, and more particularly
South Kilgore Unit described in that certain Oil and
417539500 Gas Lease dated July 29, 1993,
(continued) recorded in Volume 1871, Page
682, Official Public Records,
Rusk County, Texas
42-401-056615-00U A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated June 1, 1993,
recorded in Volume 1871, Page
680, Official Public Records,
Rusk County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
42-401-056615-00V A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated March 1, 1997,
recorded in Volume 2019, Page
710, Official Public Records,
Rusk County, Texas. (ALL DEPTHS)
42-401-056615-00W A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated September 27,
1996, recorded in Volume 1997,
Page 12, Official Public Records,
Rusk County, Texas. (ALL DEPTHS)
42-401-056615-00X A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated September 30,
1996, recorded in Volume 1997,
Page 7, Official Public Records,
Rusk County, Texas. (ALL DEPTHS)
</TABLE>
Page 92 of 165
<PAGE> 119
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056615-00Y Barbara Palmer, Atlantic Richfield 10-29-96 2009 575
Mayfield, S. E. Widow, et al Company
415040600
South Kilgore Unit
417539500
(continued)
42-401-056615-00Z Carlton Palmer Atlantic Richfield 11-7-97 2046 10
Company
42-401-056615-0AA Carl Bean, Jr. Atlantic Richfield 10-30-97 2045 181
Company
42-401-056615-0AB Betty Springer Reeds Atlantic Richfield 11-4-97 2046 6
Revocable Trust Company
42-401-056615-0AC Melvin Palmer Atlantic Richfield 11-20-97 2056 466
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056615-00Y A tract of land out of the Daniel
Mayfield, S. E. Clark Survey, Rusk County, Texas,
415040600 containing 33.4 acres more or
less, and more particularly
South Kilgore Unit described in that certain Oil and
417539500 Gas Lease dated October 29, 1996,
(90continued) recorded in Volume 2009, Page
575, Official Public Records,
Rusk County, Texas.
42-401-056615-00Z A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 7, 1997,
recorded in Volume 2046, Page 10,
Official Public Records, Rusk
County, Texas.
42-401-056615-0AA A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated October 30, 1997,
recorded in Volume 2045, Page
181, Official Public Records,
Rusk County, Texas.
42-401-056615-0AB A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 4, 1997,
recorded in Volume 2046, Page 6,
Official Public Records, Rusk
County, Texas.
42-401-056615-0AC A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 20,
1997, recorded in Volume 2056,
Page 466, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 93 of 165
<PAGE> 120
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056615-0AD Eva Mayfield Baham Atlantic Richfield 11-17-97 2056 458
Mayfield, S. E. Company
415040600
South Kilgore Unit
417539500
(continued)
42-401-056615-0AE Ricky R. Dixon Atlantic Richfield 11-11-97 2052 849
Company
42-401-056615-0AF Darcus Palmer Atlantic Richfield 11-7-97 2044 787
Company
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000863-000 James Owen Argo Royalty Company 8-16-32 225 85
R. G. Mason (16) (Mineral Deed)
410763200
1.5625% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056615-0AD A tract of land out of the Daniel
Mayfield, S. E. Clark Survey, Rusk County, Texas,
415040600 containing 33.4 acres more or
less, and more particularly
South Kilgore Unit described in that certain Oil and
417539500 Gas Lease dated November 17,
(continued) 1997, recorded in Volume 2056,
Page 458, Official Public
Records, Rusk County, Texas.
42-401-056615-0AE A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.4 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 11,
1997, recorded in Volume 2052,
Page 849, Official Public
Records, Rusk County, Texas.
42-401-056615-0AF A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 11.07 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 7, 1997,
recorded in Volume 2044, Page
787, Official Public Records,
Rusk County, Texas.
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-000863-000 A tract containing 104.4 acres of Oil, Gas and Mineral Lease dated October 29,
R. G. Mason (16) (Mineral Deed) land out of the Juan B. Cadena 1929, recorded in Volume 145, Page 313, Deed
410763200 League, Rusk County, Texas, and Records, Rusk County, Texas.
1.5625% RI more particularly described in
that certain Mineral Deed dated
August 16, 1932, recorded in
Volume 225, Page 85, Deed
Records, Rusk County, Texas.
</TABLE>
Page 94 of 165
<PAGE> 121
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056619-00A C. F. Jones, et al P. A. Wiley 11-5-34 257 266
Rosa Jones (s)
415687100
100% WI
87.50% NRI
Rosa Jones (W&B) (s)
419999500
100% WI 42-401-056619-00B Victor A. Smith, et al R. W. Ingram 11-28-34 257 403
87.5% NRI
South Kilgore Unit (s)
417539500
42-401-056619-00C Bert L. Laubenheim P. A. Wiley 9-26-34 255 544
42-401-056619-00D G. E. Fagg P. A. Wiley 9-26-34 255 542
42-401-056619-00E E. L. Clay P. A. Wiley 9-26-34 255 539
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056619-00A A tract of land out of the Daniel AR-105213
Rosa Jones (s) Clark Survey, Rusk County, Texas, Acreage Exchange Agreement dated effective
415687100 containing 33.2 acres more or April 1, 1995 by and between Paloma Partners,
100% WI less, and more particularly Ltd. and Atlantic Richfield Company. (s)
87.50% NRI described in that certain Oil and
Gas Lease dated November 5, 1934, AR-105265-001
Rosa Jones (W&B) (s) recorded in Volume 257, Page 266, Crude Oil Buy/Sell Contract dated effective
419999500 Deed Records, Rusk County, Texas. December 1, 1995 by and between ARCO Permian
100% WI and Sun Company, Inc. (s)
87.5% NRI 42-401-056619-00B A tract of land out of the Daniel
Clark Survey, Rusk County, Texas, AR-105265-000
South Kilgore Unit (s) containing 33.2 acres more or Purchase and Sale Agreement dated October 6,
417539500 less, and more particularly 1995 by and between East Texas Gathering
described in that certain Oil and Company, Atlantic Richfield Company, Sun Pipe
Gas Lease dated November 28, Line Company and Sun Company, Inc. (s)
1934, recorded in Volume 257,
Page 403, Deed Records, Rusk AR-105875
County, Texas. South Kilgore Unit and Unit Operating
Agreement dated effective May 1, 1997,
42-401-056619-00C A tract of land out of the Daniel Atlantic Richfield Company, Operator. (s)
Clark Survey, Rusk County, Texas,
containing 33.2 acres more or AR-105583
less, and more particularly Longview Gas Plant Gas Purchase Contract
described in that certain Oil and dated November 1, 1997 by and between ARCO
Gas Lease dated September 26, Permian, Seller, and ARCO Permian, Buyer,
1934, recorded in Volume 255, amended August 25, 1998. (s/d)
Page 544, Deed Records, Rusk
County, Texas. Private Radio License from Federal
Communications Commission to ARCO
42-401-056619-00D A tract of land out of the Daniel Communications, Inc., dated December 16,
Clark Survey, Rusk County, Texas, 1992, File No. 0000000319451, Call Sign
containing 33.2 acres more or KNEP883, Frequency 154.47875 MHZ
less, and more particularly
described in that certain Oil and
Gas Lease dated September 26,
1934, recorded in Volume 255,
Page 542, Deed Records, Rusk
County, Texas.
42-401-056619-00E A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.2 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated September 26,
1934, recorded in Volume 255,
Page 539, Deed Records, Rusk
County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
</TABLE>
Page 95 of 165
<PAGE> 122
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056619-00F Falcon Company P. A. Wiley 9-26-34 255 540
Rosa Jones (s)
415687100
Rosa Jones (W&B) (s)
419999500
South Kilgore Unit (s)
417539500 42-401-056619-00G C. F. Jones, Guardian P. A. Wiley 11-26-34 258 511
(continued) of the Estate of Rosa
Jones, NCM
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056619-00F A tract of land out of the Daniel
Rosa Jones (s) Clark Survey, Rusk County, Texas,
415687100 containing 33.2 acres more or
less, and more particularly
Rosa Jones (W&B) (s) described in that certain Oil and
419999500 Gas Lease dated September 26,
1934, recorded in Volume 255,
South Kilgore Unit (s) Page 540, Deed Records, Rusk
417539500 County, Texas.
(continued)
42-401-056619-00G A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 33.2 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated November 26,
1934, recorded in Volume 258,
Page 511, Deed Records, Rusk
County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
</TABLE>
Page 96 of 165
<PAGE> 123
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-00A Rufus Jones, Jr., et Roy H. Laird, et al 9-11-30 151 213
Rufus Jones "A" (s) ux
415959400
100% WI
68.5625% NRI
Rufus Jones "B" (s)
416959000
100% WI 42-401-056621-00B Opal Gene Givens, J. H. Merritt 9-11-33 237 556
68.5625% NRI feme sole and T. J.
Givens
R. Jones/Bond-Jones (s)
418860800
100% WI
87.5% NRI
R. Jones (Phillips) (s) 42-401-056621-00C Sun Oil Company Warner-Quinlan 9-10-34 256 407
411253900 Company of Texas
100% WI
63.5981% NRI
South Kilgore Unit (s)
417539500
97.659398% WI
83.460188% NRI 42-401-056621-00D Howard Crenshaw, et ux R. E. Moore 6-18-34 256 411
42-401-056621-00E W. H. Grier & A. A. R. E. Moore 6-18-34 256 413
Biggs, et al
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-00A A tract of land out of the Daniel AR-105414-001
Rufus Jones "A" (s) Clark Survey, Rusk County, Texas, Operating Agreement dated effective June 1,
415959400 containing 10.0 acres more or 1980 by and between Gibson Drilling Company,
100% WI less, and more particularly Operator, and James H. Merritt,
68.5625% NRI described in that certain Oil and Non-Operator. (s)
Gas Lease dated September 11,
Rufus Jones "B" (s) 1930, recorded in Volume 151, Private Radio License from Federal
416959000 Page 213, Deed Records, Rusk Communications Commission to ARCO
100% WI County, Texas. Communications, Inc., dated December 16,
68.5625% NRI 1992, File No. 0000000319451, Call Sign
42-401-056621-00B A tract of land out of the Daniel KNEP883, Frequency 154.47875 MHZ
R. Jones/Bond-Jones (s) Clark Survey, Rusk County, Texas,
418860800 containing 25 acres more or less, AR-105213
100% WI and more particularly described Acreage Exchange Agreement dated effective
87.5% NRI in that certain Oil and Gas Lease April 1, 1995 by and between Paloma Partners,
dated September 11, 1933, Ltd. and Atlantic Richfield Company. (s)
R. Jones (Phillips) (s) recorded in Volume 237, Page 556
411253900 of Deed Records, Rusk County, AR-105265-000
100% WI Texas. Purchase and Sale Agreement dated October 6,
63.5981% NRI 1995 by and between East Texas Gathering
42-401-056621-00C A tract of land out of the Daniel Company, Atlantic Richfield Company, Sun Pipe
South Kilgore Unit (s) Clark Survey, Rusk County, Texas, Line Company and Sun Company, Inc. (s)
417539500 containing 25 acres more or less,
97.659398% WI and more particularly described AR-105265-001
83.460188% NRI in that certain Oil and Gas Lease Crude Oil Buy/Sell Contract dated effective
dated September 10, 1934, December 1, 1995 by and between ARCO Permian
recorded in Volume 256, Page 407, and Sun Company, Inc. (s)
Deed Records, Rusk County, Texas.
AR-105875
42-401-056621-00D A tract of land out of the Daniel South Kilgore Unit and Unit Operating
Clark Survey, Rusk County, Texas, Agreement dated effective May 1, 1997,
containing 25 acres more or less, Atlantic Richfield Company, Operator. (s)
and more particularly described (Except the Rufus Jones "A")
in that certain Oil and Gas Lease
dated June 18, 1934, recorded in AR-105583
Volume 256, Page 411, Deed Longview Gas Plant Gas Purchase Contract
Records, Rusk County, Texas. dated November 1, 1997 by and between ARCO
Permian, Seller, and ARCO Permian, Buyer.
42-401-056621-00E A tract of land out of the Daniel (s/d)
Clark Survey, Rusk County, Texas,
containing 25 acres more or less, AR-105584
and more particularly described Longview Gas Plant Gas Purchase Contract
in that certain Oil and Gas Lease dated November 1, 1997 by and between ARCO
dated June 18, 1934, recorded in Permian, Seller, and ARCO Permian, Buyer. (s)
Volume 256, Page 413, Deed (Rufus Jones "A")
Records, Rusk County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
</TABLE>
Page 97 of 165
<PAGE> 124
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-00F M. S. Thetford R. E. Moore 9-1-34 253 481
Rufus Jones "A" (s)
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800 42-401-056621-00G J. H. Merritt R. E. Moore 9-8-34 253 483
R. Jones (Phillips) (s)
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-00H May Greve, et vir R. E. Moore 9-1-34 253 484
42-401-056621-00I T. J. Strahan R. E. Moore 9-1-34 253 486
42-401-056621-00J Mary Jane Fischer Atlantic Richfield 5-1-96 2011 853
Rosenbaum Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-00F A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, Rusk County, Texas,
415959400 containing 25 acres more or less,
and more particularly described
Rufus Jones "B" (s) in that certain Oil and Gas Lease
416959000 dated September 1, 1934, recorded
in Volume 253, Page 481, Deed
Records, Rusk County, Texas.
R. Jones/Bond-Jones (s)
418860800 42-401-056621-00G A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 25 acres more or less,
and more particularly described
R. Jones (Phillips) (s) in that certain Oil and Gas Lease
411253900 dated September 8, 1934, recorded
in Volume 253, Page 483, Deed
South Kilgore Unit (s) Records, Rusk County, Texas.
417539500
(continued) 42-401-056621-00H A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 25 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated September 1, 1934, recorded
in Volume 253, Page 484, Deed
Records, Rusk County, Texas.
42-401-056621-00I A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 25 acres more or less,
and more particularly described
in that certain Oil and Gas Lease
dated September 1, 1934, recorded
in Volume 253, Page 486, Deed
Records, Rusk County, Texas.
42-401-056621-00J A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated May
1, 1996, recorded in Volume 2011,
Page 853, Official Public
Records, Rusk County, Texas.
ONLY INSOFAR AS LEASES COVER
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION.
</TABLE>
Page 98 of 165
<PAGE> 125
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-00K Joseph M. Wolfe Atlantic Richfield 5-1-96 2011 868
Rufus Jones "A" (s) Company
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-00L Don Warren Atlantic Richfield 3-15-97 2003 754
R. Jones (Phillips) (s) Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-00M Mary L. Williams Atlantic Richfield 2-15-97 2009 757
Company
42-401-056621-00N Joyce Kennedy, Trustee Atlantic Richfield 3-15-97 2009 751
Company
42-401-056621-00O Bernice Koret Atlantic Richfield 2-17-97 2011 839
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-00K A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, A-162, Rusk County,
415959400 Texas, containing 1.7 acres more
or less, and more particularly
Rufus Jones "B" (s) described in that certain Oil,
416959000 Gas and Mineral Lease dated May
1, 1996, recorded in Volume 2011,
R. Jones/Bond-Jones (s) Page 868, Official Public
418860800 Records, Rusk County, Texas.
R. Jones (Phillips) (s) 42-401-056621-00L A tract of land out of the Daniel
411253900 Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
South Kilgore Unit (s) or less, and more particularly
417539500 described in that certain Oil,
(continued) Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2003, Page 754, Official Public
Records, Rusk County, Texas.
42-401-056621-00M A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated
February 15, 1997, recorded in
Volume 2009, Page 757, Official
Public Records, Rusk County,
Texas.
42-401-056621-00N A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2009, Page 751, Official Public
Records, Rusk County, Texas.
42-401-056621-00O A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated
February 17, 1997, recorded in
Volume 2011, Page 839, Official
Public Records, Rusk County,
Texas.
</TABLE>
Page 99 of 165
<PAGE> 126
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-00P Foster T. Bean Atlantic Richfield 3-15-97 2011 828
Rufus Jones "A" (s) Company
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-00Q Alfred S. Wolfe Atlantic Richfield 3-15-97 2011 865
R. Jones (Phillips) (s) Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-00R Edwin N. Wolfe Atlantic Richfield 3-15-97 2011 862
Company
42-401-056621-00S Vera Marwil Remer Atlantic Richfield 3-15-97 2011 850
Company
42-401-056621-00T Doris Marwil Frost Atlantic Richfield 3-15-97 2011 836
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-00P A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, A-162, Rusk County,
415959400 Texas, containing 1.7 acres more
or less, and more particularly
Rufus Jones "B" (s) described in that certain Oil,
416959000 Gas and Mineral Lease dated March
15, 1997, recorded in Volume
R. Jones/Bond-Jones (s) 2011, Page 828, Official Public
418860800 Records, Rusk County, Texas.
R. Jones (Phillips) (s) 42-401-056621-00Q A tract of land out of the Daniel
411253900 Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
South Kilgore Unit (s) or less, and more particularly
417539500 described in that certain Oil,
(continued) Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2011, Page 865, Official Public
Records, Rusk County, Texas.
42-401-056621-00R A tract of land out of the Daniel
Clark Survey, A-162 Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2011, Page 862, Official Public
Records, Rusk County, Texas.
42-401-056621-00S A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2011, Page 850, Official Public
Records, Rusk County, Texas.
42-401-056621-00T A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2011, Page 836, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 100 of 165
<PAGE> 127
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-00U Sean Wrather Atlantic Richfield 3-15-97 2011 859
Rufus Jones "A" (s) Company
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-00V Lamar Elder, Guardian Atlantic Richfield 3-15-97 2011 833
R. Jones (Phillips) (s) Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-00W Iva Lee Sloan Atlantic Richfield 3-15-97 2011 856
Company
42-401-056621-00X Shirley Marwil Sanger Atlantic Richfield 3-15-97 2020 699
Company
42-401-056621-00Y Althea J. Pickett Atlantic Richfield 10-1-97 2042 486
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-00U A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, A-162, Rusk County,
415959400 Texas, containing 1.7 acres more
or less, and more particularly
Rufus Jones "B" (s) described in that certain Oil,
416959000 Gas and Mineral Lease dated March
15, 1997, recorded in Volume
R. Jones/Bond-Jones (s) 2011, Page 859, Official Public
418860800 Records, Rusk County, Texas.
R. Jones (Phillips) (s) 42-401-056621-00V A tract of land out of the Daniel
411253900 Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
South Kilgore Unit (s) or less, and more particularly
417539500 described in that certain Oil,
(continued) Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2011, Page 833, Official Public
Records, Rusk County, Texas.
42-401-056621-00W A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2011, Page 856, Official Public
Records, Rusk County, Texas.
42-401-056621-00X A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2020, Page 699, Official Public
Records, Rusk County, Texas.
42-401-056621-00Y A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated
October 1, 1997, recorded in
Volume 2042, Page 486, Official
Public Records, Rusk County,
Texas.
</TABLE>
Page 101 of 165
<PAGE> 128
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-00Z Bettye Joyce Butts Atlantic Richfield 3-15-97 2052 786
Rufus Jones "A" (s) Turner Company
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-0AA Cozetta Butts Lamore, Atlantic Richfield 3-15-97 2052 784
R. Jones (Phillips) (s) Executrix Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-0AB Jenny Marwil Hardy Atlantic Richfield 9-30-97 2057 847
Company
42-401-056621-0AC Earl Stanley Marwil, Atlantic Richfield 1-30-98 2057 853
Custodian Company
42-401-056621-0AD Ann Gibson Atlantic Richfield 1-30-98 2057 844
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-00Z A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, A-162, Rusk County,
415959400 Texas, containing 1.7 acres more
or less, and more particularly
Rufus Jones "B" (s) described in that certain Oil,
416959000 Gas and Mineral Lease dated March
15, 1997, recorded in Volume
R. Jones/Bond-Jones (s) 2052, Page 786, Official Public
418860800 Records, Rusk County, Texas.
R. Jones (Phillips) (s) 42-401-056621-0AA A tract of land out of the Daniel
411253900 Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
South Kilgore Unit (s) or less, and more particularly
417539500 described in that certain Oil,
(continued) Gas and Mineral Lease dated March
15, 1997, recorded in Volume
2052, Page 784, Official Public
Records, Rusk County, Texas.
42-401-056621-0AB A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil,
Gas and Mineral Lease dated
September 30, 1997, recorded in
Volume 2057, Page 847, Official
Public Records, Rusk County,
Texas.
42-401-056621-0AC A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 30, 1998,
recorded in Volume 2057, Page
853, Official Public Records,
Rusk County, Texas.
42-401-056621-0AD A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 30, 1998,
recorded in Volume 2057, Page
844, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 102 of 165
<PAGE> 129
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-0AE L. W. Sugar Limited Atlantic Richfield 1-30-98 2057 850
Rufus Jones "A" (s) Partnership Company
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-0AF Douglas Deutser Atlantic Richfield 1-30-98 2060 102
R. Jones (Phillips) (s) Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-0AG Nelson Marwil, Atlantic Richfield 1-30-98 2060 401
Custodian Company
42-401-056621-0AH Angela Jones Burns Atlantic Richfield 10-1-97 2061 537
Company
42-401-056621-0AI Evelyn Yvonne Byrd Atlantic Richfield 3-21-98 2073 293
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-0AE A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, A-162, Rusk County,
415959400 Texas, containing 1.7 acres more
or less, and more particularly
Rufus Jones "B" (s) described in that certain Oil and
416959000 Gas Lease dated January 30, 1998,
recorded in Volume 2057, Page
R. Jones/Bond-Jones (s) 850, Official Public Records,
418860800 Rusk County, Texas.
R. Jones (Phillips) (s) 42-401-056621-0AF A tract of land out of the Daniel
411253900 Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
South Kilgore Unit (s) or less, and more particularly
417539500 described in that certain Oil
(continued) and Gas Lease dated January 30,
1998, recorded in Volume 2060,
Page 102, Official Public
Records, Rusk County, Texas.
42-401-056621-0AG A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 30, 1998,
recorded in Volume 2060, Page
401, Official Public Records,
Rusk County, Texas.
42-401-056621-0AH A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated October 1, 1997,
recorded in Volume 2061, Page
537, Official Public Records,
Rusk County, Texas.
42-401-056621-0AI A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 21, 1998,
recorded in Volume 2073, Page
293, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 103 of 165
<PAGE> 130
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-0AJ Rosalind J. Robinson, Atlantic Richfield 3-21-98 2073 296
Rufus Jones "A" (s) Individually and as Company
415959400 Independent Executrix
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-0AK Janis P. LaGrone, et Atlantic Richfield 1-30-98 2077 524
R. Jones (Phillips) (s) al Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-0AL Debra Barley Atlantic Richfield 1-30-98 2084 640
Company
42-401-056621-0AM Cozetta B. Lamore Atlantic Richfield 5-19-98 2084 643
Company
42-401-056621-0AN Sean Wrather Atlantic Richfield 4-6-98 2081 632
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-0AJ A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, A-162, Rusk County,
415959400 Texas, containing 1.7 acres more
or less, and more particularly
Rufus Jones "B" (s) described in that certain Oil and
416959000 Gas Lease dated March 21, 1998,
recorded in Volume 2073, Page
R. Jones/Bond-Jones (s) 296, Official Public Records,
418860800 Rusk County, Texas.
R. Jones (Phillips) (s) 42-401-056621-0AK A tract of land out of the Daniel
411253900 Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
South Kilgore Unit (s) or less, and more particularly
417539500 described in that certain Oil and
(continued) Gas Lease dated January 30, 1998,
recorded in Volume 2077, Page
524, Official Public Records,
Rusk County, Texas.
42-401-056621-0AL A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 30, 1998,
recorded in Volume 2084, Page
640, Official Public Records,
Rusk County, Texas.
42-401-056621-0AM A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 1.7 acres more
or less, and more particularly
described in that certain Oil
and Gas Lease dated May 19,
1998, recorded in Volume 2084,
Page 643, Official Public
Records, Rusk County, Texas.
42-401-056621-0AN A tract of land out of the Daniel
Clark Survey, Rusk County, Texas,
containing 1.7 acres more or
less, and more particularly
described in that certain Oil and
Gas Lease dated April 6, 1998,
recorded in Volume 2081, Page
632, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 104 of 165
<PAGE> 131
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-0AO Molly Wrather Dolle Atlantic Richfield 4-6-98 2081 571
Rufus Jones "A" (s) Company
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-0AP Beverly Allen Atlantic Richfield 5-26-98 2081 573
R. Jones (Phillips) (s) Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-0AQ Mary Ann Butts Haywood Atlantic Richfield 5-19-98 2081 591
Company
42-401-056621-0AR Oran Bell Atlantic Richfield 5-19-98 2081 579
Company
42-401-056621-0AS Elois V. Montgomery Atlantic Richfield 5-7-98 2081 604
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-0AO A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, Rusk County, Texas,
415959400 containing 1.7 acres more or
less, and more particularly
Rufus Jones "B" (s) described in that certain Oil and
416959000 Gas Lease dated April 6, 1998,
recorded in Volume 2081, Page
R. Jones/Bond-Jones (s) 571, Official Public Records,
418860800 Rusk County, Texas.
R. Jones (Phillips) (s) 42-401-056621-0AP A tract of land out of the Daniel
411253900 Clark Survey, Rusk County, Texas,
containing 1.7 acres more or
South Kilgore Unit (s) less, and more particularly
417539500 described in that certain Oil and
(continued) Gas Lease dated May 26, 1998,
recorded in Volume 2081, Page
573, Official Public Records,
Rusk County, Texas.
42-401-056621-0AQ Two tracts of land out of the
Daniel Clark Survey, Rusk County,
Texas, containing 3.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 19, 1998,
recorded in Volume 2081, Page
591, Official Public Records,
Rusk County, Texas.
42-401-056621-0AR Two tracts of land out of the
Daniel Clark Survey, Rusk County,
Texas, containing 3.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 19, 1998,
recorded in Volume 2081, Page
579, Official Public Records,
Rusk County, Texas.
42-401-056621-0AS Two tracts of land out of the
Daniel Clark Survey, Rusk County,
Texas, containing 3.7 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 7, 1998,
recorded in Volume 2081, Page
604, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 105 of 165
<PAGE> 132
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056621-0AT Deanna J. Sigman Atlantic Richfield 8-15-98 ---- -----
Rufus Jones "A" (s) Company
415959400
Rufus Jones "B" (s)
416959000
R. Jones/Bond-Jones (s)
418860800
42-401-056621-0AU Alpha B. Snell Atlantic Richfield 6-4-98 2087 240
R. Jones (Phillips) (s) Company
411253900
South Kilgore Unit (s)
417539500
(continued)
42-401-056621-0AV Frank Hudson, Receiver Atlantic Richfield 8-7-98 2087 731
Company
- ---------------------------------------------------------------------------------------------------------------------------------
East Texas Field 42-401-000855-000 F. W. Merrick Argo Royalty Company 10-3-31 205 355
Schuyler (Mineral Deed)
(188215 & 615)
410890600
3.1250% RI
East Texas Field 42-401-000856-000
Schuyler"A" (Mineral Deed)
(26-768,5101)
41089140
3.1250% RI
East Texas Field 42-401-000857-000
Schuyler "B" (Mineral Deed)
(26-769, 4970)
410892200
4.6875% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056621-0AT A tract of land out of the Daniel
Rufus Jones "A" (s) Clark Survey, A-162, Rusk County,
415959400 Texas, containing 1.7 acres more
or less, and more particularly
Rufus Jones "B" (s) described in that certain
416959000 unrecorded Oil and Gas Lease
dated August 15, 1998
R. Jones/Bond-Jones (s)
418860800
R. Jones (Phillips) (s) 42-401-056621-0AU Two tracts of land out of the
411253900 Daniel Clark Survey, A-162, Rusk
County, Texas, containing 3.7
South Kilgore Unit (s) acres more or less, and more
417539500 particularly described in that
(continued) certain Oil and Gas Lease dated
June 4, 1998, recorded in Volume
2087, Page 240, Official Public
Records, Rusk County, Texas.
42-401-056621-0AV A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated August 7, 1998,
recorded in Volume 2087, Page
731, Official Public Records,
Rusk County, Texas.
- -----------------------------------------------------------------------------------------------------------------------------------
East Texas Field 42-401-000855-000 Two tracts of land out of the J. Oil, Gas and Mineral Lease dated July 21,
Schuyler (Mineral Deed) B. Cadena Survey, Rusk County, 1930, recorded in Volume 148, Page 411, Deed
(188215 & 615) Texas, consisting of a 92 acre Records, Rusk County, Texas.
410890600 tract of land and a 72 acre tract
3.1250% RI of land in Rusk County, Texas,
and more particularly described
East Texas Field 42-401-000856-000 in that certain Deed dated
Schuyler"A" (Mineral Deed) October 3, 1931, recorded in
(26-768,5101) Volume 205, Page 355, Deed
41089140 Records, Rusk County, Texas.
3.1250% RI
East Texas Field 42-401-000857-000
Schuyler "B" (Mineral Deed)
(26-769, 4970)
410892200
4.6875% RI
</TABLE>
Page 106 of 165
<PAGE> 133
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056622-000 School District No. Roy F. Calvert 11-17-31 209 546
Starr-Bailey (s) 29, Trustees of
417897100 Leverett Chapel ISD
100% WI
87.50% NRI
South Kilgore Unit (s)
417539500
97.659398% WI
83.460188% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056622-000 3 acres, more or less, out of the AR-105213
Starr-Bailey (s) Daniel Clark Survey A-162, Rusk Acreage Exchange Agreement dated effective
417897100 County, Texas, as more April 1, 1995 by and between Paloma Partners,
100% WI particularly described in that Ltd. and Atlantic Richfield Company. (s)
87.50% NRI certain Oil and Gas Lease dated
November 17, 1931, recorded AR-105265-000
South Kilgore Unit (s) Volume 209, Page 546, Deed Purchase and Sale Agreement dated October 6,
417539500 Records, Rusk County, Texas 1995 by and between East Texas Gathering
97.659398% WI Company, Atlantic Richfield Company, Sun Pipe
83.460188% NRI ONLY INSOFAR AS LEASE COVERS THE Line Company and Sun Company, Inc. (s)
RIGHTS FROM THE SURFACE TO THE
BASE OF THE WOODBINE FORMATION. AR-105265-001
Crude Oil Buy/Sell Contract dated effective
December 1, 1995 by and between ARCO Permian
and Sun Company, Inc. (s)
AR-105583
Longview Gas Plant Gas Purchase Contract
dated November 1, 1997 by and between ARCO
Permian, Seller, and ARCO Permian, Buyer,
amended August 25, 1998. (s/d)
AR-105875
South Kilgore Unit and Unit Operating
Agreement dated effective May 1, 1997,
Atlantic Richfield Company, Operator. (s)
Private Radio License from Federal
Communications Commission to ARCO
Communications, Inc., dated December 16,
1992, File No. 0000000319451, Call Sign
KNEP883, Frequency 154.47875 MHZ
</TABLE>
Page 107 of 165
<PAGE> 134
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-00A Elizabeth Bowman Atlantic Richfield 12-30-97 2059 341
South Kilgore Unit (s) Company
417539500
97.659398% WI
83.460188% NRI
Unit Tract 14
42-401-057091-00B F. T. Bean Atlantic Richfield 1-5-98 2059 343
Company
42-401-057091-00C Barbara Nell Breen Atlantic Richfield 12-30-97 2059 345
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-00A A tract of land out of the Daniel AR-105875
South Kilgore Unit (s) Clark Survey, A-162, Rusk County, South Kilgore Unit and Unit Operating
417539500 Texas, containing 2.00 acres more Agreement dated effective May 1, 1997,
97.659398% WI or less, and more particularly Atlantic Richfield Company, Operator. (s)
83.460188% NRI described in that certain Oil and
Gas Lease dated December 30, AR-105583
Unit Tract 14 1997, recorded in Volume 2059, Longview Gas Plant Gas Purchase Contract
Page 341, Official Public dated November 1, 1997 by and between ARCO
Records, Rusk County, Texas. Permian, Seller, and ARCO Permian, Buyer,
amended August 25, 1998. (s/d)
42-401-057091-00B A tract of land out of the Daniel
Clark Survey, A-162, Rusk County, Private Radio License from Federal
Texas, containing 2.00 acres more Communications Commission to ARCO
or less, and more particularly Communications, Inc., dated December 16,
described in that certain Oil and 1992, File No. 0000000319451, Call Sign
Gas Lease dated January 5, 1998, KNEP883, Frequency 154.47875 MHZ
recorded in Volume 2059, Page
343, Official Public Records,
Rusk County, Texas.
42-401-057091-00C A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 30,
1997, recorded in Volume 2059,
Page 345, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 108 of 165
<PAGE> 135
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-00D Mary Margaret Carloss Atlantic Richfield 1-5-98 2059 347
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-00E Nick Cooney Atlantic Richfield 1-5-98 2059 349
Company
42-401-057091-00F Patricia Ann Harrison Atlantic Richfield 1-19-98 2059 352
Company
42-401-057091-00G Elmer Hays Atlantic Richfield 12-29-97 2059 354
Company
42-401-057091-00H Harvey Hays, Jr. Atlantic Richfield 1-19-98 2059 356
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-00D A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated January 5, 1998,
recorded in Volume 2059, Page
347, Official Public Records,
Rusk County, Texas.
42-401-057091-00E A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 5, 1998,
recorded in Volume 2059, Page
349, Official Public Records,
Rusk County, Texas.
42-401-057091-00F A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 19, 1998,
recorded in Volume 2059, Page
352, Official Public Records,
Rusk County, Texas.
42-401-057091-00G A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2059,
Page 354, Official Public
Records, Rusk County, Texas.
42-401-057091-00H A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 19, 1998,
recorded in Volume 2059, Page
356, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 109 of 165
<PAGE> 136
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-00I Major Kennedy, Jr. Atlantic Richfield 1-5-98 2059 358
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-00J Joyce Kennedy, Trustee Atlantic Richfield 1-5-98 2059 360
Company
42-401-057091-00K Velma Lemons Atlantic Richfield 1-5-98 2059 362
Company
42-401-057091-00L Mayde Lowry Atlantic Richfield 1-14-98 2059 364
Company
42-401-057091-00M Teressa Montgomery Atlantic Richfield 2-11-98 2059 366
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-00I A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated January 5, 1998,
recorded in Volume 2059, Page
358, Official Public Records,
Rusk County, Texas.
42-401-057091-00J A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 5, 1998,
recorded in Volume 2059, Page
360, Official Public Records,
Rusk County, Texas.
42-401-057091-00K A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 5, 1998,
recorded in Volume 2059, Page
362, Official Public Records,
Rusk County, Texas.
42-401-057091-00L A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 14, 1998,
recorded in Volume 2059, Page
364, Official Public Records,
Rusk County, Texas.
42-401-057091-00M A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated February 11,
1998, recorded in Volume 2059,
Page 366, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 110 of 165
<PAGE> 137
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-00N Morris Farms-A Atlantic Richfield 12-29-97 2059 369
South Kilgore Unit (s) Co-Partnership Company
417539500
Unit Tract 14
(continued)
42-401-057091-00O Dorothy Montgomery Atlantic Richfield 2-11-98 2059 371
Company
42-401-057091-00P Norene M. Murray Atlantic Richfield 12-29-97 2059 373
Company
42-401-057091-00Q James Norton Atlantic Richfield 2-3-98 2059 375
Scrimshire, Co-Trustee Company
42-401-057091-00R Donnie M. Wilson Atlantic Richfield 1-5-98 2059 378
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-00N A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2059,
Page 369, Official Public
Records, Rusk County, Texas.
42-401-057091-00O A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated February 11,
1998, recorded in Volume 2059,
Page 371, Official Public
Records, Rusk County, Texas.
42-401-057091-00P A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2059,
Page 373, Official Public
Records, Rusk County, Texas.
42-401-057091-00Q A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated February 3, 1998,
recorded in Volume 2059, Page
375, Official Public Records,
Rusk County, Texas.
42-401-057091-00R A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 5, 1998,
recorded in Volume 2059, Page
378, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 111 of 165
<PAGE> 138
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-00S Evelyn Yvonne Byrd Atlantic Richfield 3-21-98 2073 299
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-00T Rosalind J. Robinson Atlantic Richfield 3-21-98 2073 302
Company
42-401-057091-00U Ann H. Keetch Atlantic Richfield 3-12-98 2065 352
Company
42-401-057091-00V Iva Lee Sloan Atlantic Richfield 3-11-98 2065 360
Company
42-401-057091-00W John J. Hays Atlantic Richfield 12-29-97 2065 350
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-00S A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated March 21, 1998,
recorded in Volume 2073, Page
299, Official Public Records,
Rusk County, Texas.
42-401-057091-00T A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 21, 1998,
recorded in Volume 2073, Page
302, Official Public Records,
Rusk County, Texas.
42-401-057091-00U A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 12, 1998,
recorded in Volume 2065, Page
352, Official Public Records,
Rusk County, Texas.
42-401-057091-00V A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 11, 1998,
recorded in Volume 2065, Page
360, Official Public Records,
Rusk County, Texas.
42-401-057091-00W A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2065,
Page 350, Official Public
Records, Rusk County, Texas.
</TABLE>
Page 112 of 165
<PAGE> 139
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-00X D. J. Montgomery Atlantic Richfield 2-11-98 2065 354
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-00Y Marilyn M. Nicholson Atlantic Richfield 12-29-97 2065 358
Company
42-401-057091-00Z Emma Sue Vernor Atlantic Richfield 3-11-98 2065 362
Company
42-401-057091-0AA Jo Anne Montgomery Atlantic Richfield 12-29-97 2065 356
Company
42-401-057091-0AB Carolyn Kennedy Atlantic Richfield 4-9-98 2069 264
Traylor Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-00X A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated February 11,
1998, recorded in Volume 2065,
Page 354, Official Public
Records, Rusk County, Texas.
42-401-057091-00Y A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2065,
Page 358, Official Public
Records, Rusk County, Texas.
42-401-057091-00Z A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 11, 1998,
recorded in Volume 2065, Page
362, Official Public Records,
Rusk County, Texas.
42-401-057091-0AA A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2065,
Page 356, Official Public
Records, Rusk County, Texas.
42-401-057091-0AB A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated April 9, 1998,
recorded in Volume 2069, Page
264, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 113 of 165
<PAGE> 140
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0AC Lois H. Bannister Atlantic Richfield 3-11-98 2069 254
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-0AD Bertha M. Bellamy Atlantic Richfield 3-12-98 2069 252
Company
42-401-057091-0AE Carter H. Rhoads Atlantic Richfield 3-26-98 2069 248
Company
42-401-057091-0AF Robert W. Hamilton Atlantic Richfield 3-12-98 2069 256
Company
42-401-057091-0AG Emily H. Langford Atlantic Richfield 3-11-98 2069 258
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0AC A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated March 11, 1998,
recorded in Volume 2069, Page
254, Official Public Records,
Rusk County, Texas.
42-401-057091-0AD A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 12, 1998,
recorded in Volume 2069, Page
252, Official Public Records,
Rusk County, Texas.
42-401-057091-0AE A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 26, 1998,
recorded in Volume 2069, Page
248, Official Public Records,
Rusk County, Texas.
42-401-057091-0AF A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 12, 1998,
recorded in Volume 2069, Page
256, Official Public Records,
Rusk County, Texas.
42-401-057091-0AG A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 11, 1998,
recorded in Volume 2069, Page
258, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 114 of 165
<PAGE> 141
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0AH Helen Newell Atlantic Richfield 12-29-97 2069 250
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-0AI Aurelia Benton Atlantic Richfield 1-20-98 2069 260
Company
42-401-057091-0AJ Thomas B. Bender, Jr. Atlantic Richfield 1-20-98 2069 262
Company
42-401-057091-0AK Ruth Porter Atlantic Richfield 12-30-97 2082 549
Company
42-401-057091-0AL Charles R. Stone as Atlantic Richfield 4-6-98 2081 562
Agent and Company
Attorney-in-Fact
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0AH A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2069,
Page 250, Official Public
Records, Rusk County, Texas.
42-401-057091-0AI A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 20, 1998,
recorded in Volume 2069, Page
260, Official Public Records,
Rusk County, Texas.
42-401-057091-0AJ A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 20, 1998,
recorded in Volume 2069, Page
262, Official Public Records,
Rusk County, Texas.
42-401-057091-0AK A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 30,
1997, recorded in Volume 2082,
Page 549, Official Public
Records, Rusk County, Texas.
42-401-057091-0AL A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated April 6, 1998,
recorded in Volume 2081, Page
562, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 115 of 165
<PAGE> 142
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0AM Charles R. Stone Atlantic Richfield 4-6-98 2081 628
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-0AN Rosie Terrell Atlantic Richfield 1-20-98 2081 630
Company
42-401-057091-0AO Mark Snead Atlantic Richfield 5-14-98 2081 618
Company
42-401-057091-0AP Steven Snead Atlantic Richfield 5-14-98 2081 626
Company
42-401-057091-0AQ Theodore J. Bender Atlantic Richfield 1-20-98 2081 564
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0AM A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated April 6, 1998,
recorded in Volume 2081, Page
628, Official Public Records,
Rusk County, Texas.
42-401-057091-0AN A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 20, 1998,
recorded in Volume 2081, Page
630, Deed Records, Rusk County,
Texas.
42-401-057091-0AO A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 14, 1998,
recorded in Volume 2081, Page
618, Official Public Records,
Rusk County, Texas.
42-401-057091-0AP A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 14, 1998,
recorded in Volume 2081, Page
626, Official Public Records,
Rusk County, Texas.
42-401-057091-0AQ A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated January 20, 1998,
recorded in Volume 2081, Page
564, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 116 of 165
<PAGE> 143
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0AR Barbara Cooper Atlantic Richfield 5-7-98 2081 587
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-0AS James L. Chapman Atlantic Richfield 6-4-98 2081 581
Company
42-401-057091-0AT Dottie Beth Cliburn Atlantic Richfield 5-20-98 2081 585
Company
42-401-057091-0AU Joe Scott Morris Atlantic Richfield 5-19-98 2081 606
Company
42-401-057091-0AV Charles L. Morris,III Atlantic Richfield 5-19-98 2081 602
Independent Executor Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0AR A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated May 7, 1998,
recorded in Volume 2081, Page
587, Official Public Records,
Rusk County, Texas.
42-401-057091-0AS A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated June 4, 1998,
recorded in Volume 2081, Page
581, Official Public Records,
Rusk County, Texas.
42-401-057091-0AT A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 20, 1998,
recorded in Volume 2081, Page
585, Official Public Records,
Rusk County, Texas.
42-401-057091-0AU A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 19, 1998,
recorded in Volume 2081, Page
606, Official Public Records,
Rusk County, Texas.
42-401-057091-0AV A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 19, 1998,
recorded in Volume 2081, Page
602, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 117 of 165
<PAGE> 144
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0AW Betty Sue Jones Atlantic Richfield 3-11-98 2081 600
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-0AX Pansy Hays, Atlantic Richfield 5-14-98 2081 597
Individually and as Company
Independent Executrix
42-401-057091-0AY Ada Richardson Atlantic Richfield 12-29-97 2081 616
Company
42-401-057091-0AZ Pauline Barrett Atlantic Richfield 12-29-97 2081 577
Company
42-401-057091-0BA Althea J. Pickett Atlantic Richfield 5-19-98 2081 612
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0AW A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated March 11, 1998,
recorded in Volume 2081, Page
600, Official Public Records,
Rusk County, Texas.
42-401-057091-0AX A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 14, 1998,
recorded in Volume 2081, Page
597, Official Public Records,
Rusk County, Texas.
42-401-057091-0AY A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2081,
Page 616, Official Public
Records, Rusk County, Texas.
42-401-057091-0AZ A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated December 29,
1997, recorded in Volume 2081,
Page 577, Official Public
Records, Rusk County, Texas.
42-401-057091-0BA A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 19, 1998,
recorded in Volume 2081, Page
612, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 118 of 165
<PAGE> 145
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0BB Nancy Gale Atlantic Richfield 5-27-98 2081 622
South Kilgore Unit (s) Scrimshire, Agent and Company
417539500 Attorney-in-Fact
Unit Tract 14
(continued)
42-401-057091-0BC Carolyn Newell Atlantic Richfield 5-25-98 2081 608
Company
42-401-057091-0BD Harvey D. Hays Atlantic Richfield 5-14-98 2081 593
Company
42-401-057091-0BE Edgar Capen Atlantic Richfield 3-11-98 2081 583
Company
42-401-057091-0BF Barbara Nelson, Atlantic Richfield 5-20-98 2081 610
Independent Executrix Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0BB A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated May 27, 1998,
recorded in Volume 2081, Page
622, Official Public Records,
Rusk County, Texas.
42-401-057091-0BC A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 25, 1998,
recorded in Volume 2081, Page
608, Official Public Records,
Rusk County, Texas.
42-401-057091-0BD A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 14, 1998,
recorded in Volume 2081, Page
593, Official Public Records,
Rusk County, Texas.
42-401-057091-0BE A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated March 11, 1998,
recorded in Volume 2081, Page
583, Official Public Records,
Rusk County, Texas.
42-401-057091-0BF A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Oil and
Gas Lease dated May 20, 1998,
recorded in Volume 2081, Page
610, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 119 of 165
<PAGE> 146
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0BG Barbara Knight Atlantic Richfield 1-20-98 2087 238
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-0BH McCulliss Resources Atlantic Richfield 8-1-98 2093 361
Co., Inc. Company
42-401-057091-0BI Margaret L. Hays, a Atlantic Richfield 12-30-97 2093 364
widow and sole Company
surviving heir of
Edison Ford Hayes
42-401-057091-0BJ Atlantic Richfield 1-5-98 2089 469
Malcom Kennedy Company
42-401-057091-0BK Atlantic Richfield 8-31-98 2089 467
Beatarice Harrison Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0BG A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Oil and
Gas Lease dated January 20, 1998,
recorded in Volume 2087, Page
238, Official Public Records,
Rusk County, Texas.
42-401-057091-0BH A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
42-401-057091-0BI A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
42-401-057091-0BJ A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
42-401-057091-0BK A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 120 of 165
<PAGE> 147
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-0BL Jack M. Hays Atlantic Richfield 12-27-97 2097 817
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
42-401-057091-0BM David Bender Atlantic Richfield 1-20-98 2115 333
Company
42-401-057091-0BN Nations Bank, N.A., Atlantic Richfield 6-8-98 2100 207
Trustee of Carolyn Company
Lane Trust #1
42-401-057091-0BO Carolyn Spruiell Land Atlantic Richfield 6-8-98 2109 205
Company
42-401-057901-0BP Mary Helen Spruiell Atlantic Richfield 6-8-98 2109 203
Boice Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-0BL A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
42-401-057091-0BM A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
42-401-057091-0BN A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
42-401-057091-0BO A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
42-401-057901-0BP A tract of land out of the Daniel
Clark Survey, A-162, Rusk County,
Texas, containing 2.00 acres more
or less, and more particularly
described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
</TABLE>
Page 121 of 165
<PAGE> 148
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-057091-901 Robert B. Burdick Atlantic Richfield 9-1-98 2092 423
South Kilgore Unit (s) Company
417539500
Unit Tract 14
(continued)
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-004509-000 J. E. Strickland et V. C. Perryman 11-20-29 145 607
Strickland "B" (s) ux Emily Strickland,
417880700 et al
5.4688% ORRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000852-000 S. R. Cohagan Argo Royalty Company 9-17-31 202 303
T. O. Mason (466902) (Mineral Deed)
410761600
1.5625% RI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-057091-901 A tract of land out of the Daniel
South Kilgore Unit (s) Clark Survey, A-162, Rusk County,
417539500 Texas, containing 2.00 acres more
Unit Tract 14 or less, and more particularly
(continued) described in that certain Mineral
Deed dated September 1, 1998,
recorded in Volume 2092, Page
423, Official Public Records,
Rusk County, Texas.
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
East Texas Field 42-401-004509-000 A tract of land out of the M. V.
Strickland "B" (s) Pena League, Rusk County, Texas,
417880700 more particularly described in
5.4688% ORRI Oil & Gas Lease dated November
20, 1929, recorded in Volume 145,
Page 607, Deed Records, Rusk
County, Texas.
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
East Texas Field 42-401-000852-000 147.500 acres of land out of the Oil, Gas and Mineral Lease dated November 19,
T. O. Mason (466902) (Mineral Deed) J. B. Cadena Survey, A-3, Rusk 1929, recorded in Volume 145, Page 339, Deed
410761600 County, Texas, and more Records, Rusk County, Texas
1.5625% RI particularly described in that
certain Deed dated September 17,
1931, recorded in Volume 202,
Page 303, Deed Records, Rusk
County, Texas.
</TABLE>
Page 122 of 165
<PAGE> 149
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-401-056613-00A William Brittain et L. B. Martin 8-15-34 255 341
Wm. Brittain (s) ux, et al
412323900
100% WI
76.5626% NRI
258 358
42-401-056613-00B E. C. Laster, Inc., A. B. Edwards 8-15-34
et al
257 264
42-401-056613-00C E. C. Laster, Inc. P. A. Wiley 10-29-34
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000862-000 Danciger Oil & Argo Royalty Company 2-16-32 212 322
W. M. Jernigan (Mineral Deed) Refining Company of
(26-432;5704) Texas
410684900
3.1250% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-401-000864-000
A. A. Perkins (RI)
410834500
1.7424% NRI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-401-056613-00A A tract of land out of the J. C. AR-105213
Wm. Brittain (s) Barnett Survey, Rusk County, Acreage Exchange Agreement dated effective
412323900 Texas, and more particularly April 1, 1995 by and between Paloma Partners,
100% WI described in Oil and Gas Lease Ltd. and Atlantic Richfield Company. (s)
76.5626% NRI dated August 15, 1934, recorded
in Volume 255, Page 341, Lease AR-105265-000
Records, Rusk County, Texas. Purchase and Sale Agreement dated October 6,
1995 by and between East Texas Gathering
42-401-056613-00B A tract of land out of the J. C. Company, Atlantic Richfield Company, Sun Pipe
Barnett Survey, Rusk County, Line Company and Sun Company, Inc. (s)
Texas, and more particularly
described in Oil and Gas Lease AR-105265-001
dated August 15, 1934, recorded Crude Oil Buy/Sell Contract dated effective
in Volume 258, Page 358, Lease December 1, 1995 by and between ARCO Permian
Records, Rusk County, Texas. and Sun Company, Inc. (s)
42-401-056613-00C A tract of land out of the J. C. AR-105584
Barnett Survey, Rusk County, Longview Gas Plant Gas Purchase Contract
Texas, and more particularly dated November 1, 1997 by and between ARCO
described in Oil and Gas Lease Permian, Seller, and ARCO Permian, Buyer. (s)
dated October 29, 1934, recorded
in Volume 257, Page 264, Lease Private Radio License from Federal
Records, Rusk County, Texas. Communications Commission to ARCO
Communications, Inc., dated December 16,
ONLY INSOFAR AS LEASES COVER 1992, File No. 0000000319451, Call Sign
RIGHTS FROM THE SURFACE TO THE KNEP883, Frequency 154.47875 MHZ
BASE OF THE WOODBINE FORMATION.
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
East Texas Field 42-401-000862-000 A tract of land out of the John
W. M. Jernigan (Mineral Deed) C. Snow Survey, Rusk County,
(26-432;5704) Texas, containing 31 acres more
410684900 or less, and more particularly
3.1250% RI described by metes and bounds in
that certain Mineral Deed dated
February 16, 1932, recorded in
Volume 212, Page 322, Deed
Records, Rusk County, Texas.
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
East Texas Field 42-401-000864-000 77.06 acres, more or less out of
A. A. Perkins (RI) the J. B. Cadena Survey, Rusk
410834500 County, Texas
1.7424% NRI
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
</TABLE>
Page 123 of 165
<PAGE> 150
<TABLE>
<CAPTION>
EXHIBIT "A"
ATTACHED TO AND MADE A PART OF THAT CERTAIN PURCHASE AND SALE AGREEMENT DATED EFFECTIVE AS OF
OCTOBER 1, 1999, BY AND BETWEEN ATLANTIC RICHFIELD COMPANY (ARCO)
AND FUTURE ACQUISITION 1995, LTD. (PURCHASER)
IN ADDITION TO ANY OTHER DEPTH LIMITATIONS EXPRESSED HEREIN, IT IS THE EXPRESS INTENTION TO LIMIT THE DESCRIPTIONS
OF ARCO'S INTEREST (IF ANY), FROM THE SURFACE DOWN TO THE BASE OF THE DEEPEST PRODUCING FORMATION
SMITH COUNTY
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058204-00A NationsBank of Texas, Petro Land Group 9-19-94 3642 693
Arterberry Heirs Oil Unit N.A. and M. E.
413000600 Florence, Jr.,
31.246875% WI Co-Trustees of the M.
25.61432% NRI E. Florence,Jr. Trust
and of the Annette F.
McLemore Trust
8737-01/02
42-423-058205-00A Dallas Home for the Caplex Energy, Inc. 3-27-05 3649 758
Jewish Aged, Inc.
42-423-058206-00A David M. Fender, dihsp Caplex Energy, Inc. 2-9-95 3642 778
amended
3907 120
and
ratified
3907 122
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058204-00A 37.20 acres, being tracts of 25.0 AR-105657-001
Arterberry Heirs Oil Unit acres (Deed 455/210 DR) and 12.20 Letter Agreement dated August 2, 1996,
413000600 acres (Deed 315/638 DR), from between Amoco Production Company and Caplex
31.246875% WI Surface to the stratigraphic Energy Inc.
25.61432% NRI equivalent of the Base of the
Rodessa Formation, found at AR-105657-002
approximately 7,340 feet in the C Letter Agreement between Exxon and Caplex
W Resources, Inc. Arterberry Energy Inc.
Heirs No. 1 well, E. Daniels
A-330 Survey, Smith County, Texas AR-105657-003
Letter Agreement between Five Star
42-423-058205-00A 92.0 acres in Elisha Daniels Exploration and Caplex Energy, Inc. dated
Survey A-330, being tracts of Marcy 9, 1990, amended July 30, 1996.
67.0 acres (Deed 94/513 DR) and
25.0 acres (East 25.0 acres of AR-105657-004
76.0 acres Deed 291/197 DR), from Arterberry Heirs Oil Unit Designation
the Surface to the stratigraphic
equivalent of the Base of the AR-105657-000
Rodessa Formation, found at Mid-Tex Joint Operating Agreement
approximately 7,340' in the C W Shea Prospect Joint Operating Agreement
Resources Inc. Arterberry Heirs
No. 1 well, E. Daniels A-330
Survey, Smith County, Texas
42-423-058206-00A 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 124 of 165
<PAGE> 151
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058206-00B Ruby Jean Arterberry Caplex Energy, Inc. 7-11-96 3823 as 372
Arterberry Heirs Oil Unit ratified
413000600 3837 147
31.246875% WI 3933 308
25.61432% NRI (cont'd) 3933 312
3933 310
3837 145
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058206-00B 128.841 acres in J. E. Daniels AR-105657-001
Arterberry Heirs Oil Unit Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
413000600 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
31.246875% WI acres (WD 240/349 DR) and 52.841 Energy Inc.
25.61432% NRI (cont'd) acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Arterberry Exploration and Caplex Energy, Inc. dated
Heirs No. 1 well, E. Daniels March 9, 1990, amended July 30, 1996.
A-330 Survey, Smith County, Texas
(cont'd from above) AR-105657-004
Arterberry Heirs Oil Unit Designation
AR-105657-000
Mid-Tex Joint Operating Agreement
Shea Prospect Joint Operating Agreement
</TABLE>
Page 125 of 165
<PAGE> 152
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058206-00C Charles Arterberry, Caplex Energy, Inc. 10-21-96 3889 695
Arterberry Heirs Oil Unit et ux Deloris
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00D Bonnie Arterberry, Caplex Energy, Inc. 1-10-96 3628 787
dihsp
42-423-058206-00E Caplex Energy, Inc. 1-20-95 3628 796
Leon Arterberry,
Individually and as
agent and A-I-F for
Lorenza Arterberry
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058206-00C 128.841 acres in J. E. Daniels AR-105657-001
Arterberry Heirs Oil Unit Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
413000600 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
31.246875% WI acres (WD 240/349 DR) and 52.841 Energy Inc.
25.61432% NRI acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. Marcy 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00D 128.841 acres in J. E. Daniels
Survey A-330, sometimes called AR-105657-000
135.0 acres, being tracts of 76.0 Mid-Tex Joint Operating Agreement
acres (WD 240/349 DR) and 52.841 Shea Prospect Joint Operating Agreement
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058206-00E 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 126 of 165
<PAGE> 153
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058206-00F Gregory Arterberry, Caplex Energy, Inc. 12-8-04 3692 4
Arterberry Heirs Oil Unit dihsp
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00G Kelvin Arterberry, Caplex Energy, Inc. 1-10-95 3628 as 793
dihsp ratified
3837 130
42-423-058206-00H James G. Hubley, dihsp Caplex Energy, Inc. 10-4-96 3889 701
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058206-00F 128.841 acres in J. E. Daniels AR-105657-001
Arterberry Heirs Oil Unit Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
413000600 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
31.246875% WI acres (WD 240/349 DR) and 52.841 Energy Inc.
25.61432% NRI acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. March 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00G 128.841 acres in J. E. Daniels
Survey A-330, sometimes called AR-105657-000
135.0 acres, being tracts of 76.0 Mid-Tex Joint Operating Agreement
acres (WD 240/349 DR) and 52.841 Shea Prospect Joint Operating Agreement
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058206-00H 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 127 of 165
<PAGE> 154
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058206-00I Judi Dunagan, dihsp Caplex Energy, Inc. 2-10-95 3628 802
Arterberry Heirs Oil Unit
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00J Betty Jane Zak, Caplex Energy, Inc. 10-4-96 3889 692
Individually and as
Independent Executor
of Est. of Stanley
Zak, Dec'd.
42-423-058206-00K The Frank and Marilyn Caplex Energy, Inc. 10-17-96 3889 704
Budde Family Trust
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058206-00I 128.841 acres in J. E. Daniels AR-105657-001
Arterberry Heirs Oil Unit Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
413000600 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
31.246875% WI acres (WD 240/349 DR) and 52.841 Energy Inc.
25.61432% NRI acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. March 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00J 128.841 acres in J. E. Daniels
Survey A-330, sometimes called AR-105657-000
135.0 acres, being tracts of 76.0 Mid-Tex Joint Operating Agreement
acres (WD 240/349 DR) and 52.841 Shea Prospect Joint Operating Agreement
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058206-00K 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 128 of 165
<PAGE> 155
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058206-00L Robert Don Lee Caple & 9-6-94 3616 588
Arterberry Heirs Oil Unit Arterberry, dihsp Associates
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00M Virginia Arterberry Caplex Energy, Inc. 9-13-96 3889 707
42-423-058206-00N James D. Culver, et Caplex Energy, Inc. 7-29-96 3837 124
ux Donna L.
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058206-00L 128.841 acres in J. E. Daniels AR-105657-001
Arterberry Heirs Oil Unit Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
413000600 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
31.246875% WI acres (WD 240/349 DR) and 52.841 Energy Inc.
25.61432% NRI acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. March 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00M 128.841 acres in J. E. Daniels AR-105657-000
Survey A-330, sometimes called Mid-Tex Joint Operating Agreement
135.0 acres, being tracts of 76.0 Shea Prospect Joint Operating Agreement
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058206-00N 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 129 of 165
<PAGE> 156
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058206-00O Marian Hicks Caplex Energy, Inc. 7-18-96 3889 720
Arterberry Heirs Oil Unit
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00P Sandra Richardson Wagner & Brown, Ltd. 3-21-97 3963 76
42-423-058206-00Q Carrie Lou Lawson Wagner & Brown, Ltd. 3-21-97 3947 76
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058206-00O 128.841 acres in J. E. Daniels AR-105657-001
Arterberry Heirs Oil Unit Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
413000600 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
31.246875% WI acres (WD 240/349 DR) and 52.841 Energy Inc.
25.61432% NRI acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. March 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00P 128.841 acres in J. E. Daniels AR-105657-000
Survey A-330, sometimes called Mid-Tex Joint Operating Agreement
135.0 acres, being tracts of 76.0 Shea Prospect Joint Operating Agreement
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058206-00Q 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 130 of 165
<PAGE> 157
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-058206-00R Robert Arterberry Wagner & Brown, Ltd. 3-21-97 3947 27
Arterberry Heirs Oil Unit
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00S H. L. Arterberry Wagner & Brown, Ltd. 3-21-97 3947 19
42-423-058206-00T Emma Jean Arterberry Wagner & Brown, Ltd. 3-21-97 3947 31
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-058206-00R 128.841 acres in J. E. Daniels AR-105657-001
Arterberry Heirs Oil Unit Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
413000600 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
31.246875% WI acres (WD 240/349 DR) and 52.841 Energy Inc.
25.61432% NRI acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. Marcy 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00S 128.841 acres in J. E. Daniels AR-105657-000
Survey A-330, sometimes called Mid-Tex Joint Operating Agreement
135.0 acres, being tracts of 76.0 Shea Prospect Joint Operating Agreement
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058206-00T 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 131 of 165
<PAGE> 158
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Arterberry Heirs Oil Unit 42-423-058206-00U Johnnie Mae Tucker Wagner & Brown, Ltd. 3-21-97 3947 23
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00V Renee Elliott Wagner & Brown, Ltd. 3-21-97 3963 74
Frenchell Paul
Jeffrey Pierce
42-423-058206-00W Vonzella Aarterberry Wagner & Brown, Ltd. 3-21-97 3947 21
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Arterberry Heirs Oil Unit 42-423-058206-00U 128.841 acres in J. E. Daniels AR-105657-001
413000600 Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
31.246875% WI 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
25.61432% NRI acres (WD 240/349 DR) and 52.841 Energy Inc.
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. Marcy 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00V 128.841 acres in J. E. Daniels AR-105657-000
Survey A-330, sometimes called Mid-Tex Joint Operating Agreement
135.0 acres, being tracts of 76.0 Shea Prospect Joint Operating Agreement
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058206-00W 128.841 acres in J. E. Daniels
Survey A-330, sometimes called
135.0 acres, being tracts of 76.0
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 132 of 165
<PAGE> 159
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Arterberry Heirs Oil Unit 42-423-058206-00X Jewel Timmons Wagner & Brown, Ltd. 3-21-97 3947 39
413000600
31.246875% WI
25.61432% NRI
42-423-058206-00Y Geneva Mays Wagner & Brown, Ltd. 3-21-97 3963 66
42-423-058207-00A Thomas Harold Caplex Energy, Inc. 8-8-96 3846 as 547
Grantham, ratified
Individually and as 3889 725
Independent Executor 3889 727
of the Estate of 3889 729
Sarah Helen Smith, 3931 512
Dec'd.
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Arterberry Heirs Oil Unit 42-423-058206-00X 128.841 acres in J. E. Daniels AR-105657-001
413000600 Survey A-330, sometimes called Letter Agreement dated August 2, 1996,
31.246875% WI 135.0 acres, being tracts of 76.0 between Amoco Production Company and Caplex
25.61432% NRI acres (WD 240/349 DR) and 52.841 Energy Inc.
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil AR-105657-002
Minutes Book $/226, Dist. Court Letter Agreement between Exxon and Caplex
Records), from Surface to the Energy Inc.
stratigraphic equivalent of the
base of the Rodessa Formation, AR-105657-003
found at approximately 7,340' in Letter Agreement between Five Star
the C W Resources, Inc. Exploration and Caplex Energy, Inc. dated
Arterberry Heirs No. 1 well, E. Marcy 9, 1990, amended July 30, 1996.
Daniels A-330 Survey, Smith
County, Texas AR-105657-004
Arterberry Heirs Oil Unit Designation
42-423-058206-00Y 128.841 acres in J. E. Daniels AR-105657-000
Survey A-330, sometimes called Mid-Tex Joint Operating Agreement
135.0 acres, being tracts of 76.0 Shea Prospect Joint Operating Agreement
acres (WD 240/349 DR) and 52.841
acres (sometimes called 49.80
acres Block 2, 3, 4 suit Civil
Minutes Book $/226, Dist. Court
Records), from Surface to the
stratigraphic equivalent of the
base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
42-423-058207-00A 271.441 acres, being tracts of
76.0 acres (WD 240/349 DR) and
52.841 acres (Sometimes called
49.80 acres Block 2, 3, 4 suit
Civil Minutes Book R/226, Dist.
Court Records), 69.90 acres (Deed
47/531 DR), and 60.9 acres (Deed
Y/426 DR) in J. E. Daniels A-330
Survey, and 12.7 acres out of the
D. Shaw Survey A-917 (WD 57/93
DR) from Surface to the
stratigraphic equivalent of the
Base of the Rodessa Formation,
found at approximately 7,340' in
the C W Resources, Inc.
Arterberry Heirs No. 1 well, E.
Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 133 of 165
<PAGE> 160
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Arterberry Heirs Oil Unit 42-423-058208-00A J. S. Hudnall Frank J. Budde 6-17-66 1202 349
413000600 G.W. Pirtle (Exxon)
31.246875% WI (Exxon Corporation
25.61432% NRI F/O & AOGL)
42-423-058209-00A Sam Arterberry, a M. E. Zoller (Exxon) 11-6-73 1471 567
single man dihsp
(Exxon Corporation FO
& AOGL)
42-423-058210-00A Annette F. Broyles M. E. Zoller (Exxon) 2-/12-74 1493 887
D. I. Felsenthal
Sharon F. Goren
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Arterberry Heirs Oil Unit 42-423-058208-00A 4.15 acre Tract 2 of 40.0 acre AR-105657-001
413000600 Arterberry Oil Unit (4.15 acres Letter Agreement dated August 2, 1996,
31.246875% WI out of 25.50 acre tract described between Amoco Production Company and Caplex
25.61432% NRI in MD 322/435 DR), from Surface Energy Inc.
to 7,340' in the C W Resources,
Inc. Arterberry Heir No. 1 well, AR-105657-002
E. Daniels A-330 Survey, Smith Letter Agreement between Exxon and Caplex
County, Texas Energy Inc.
AR-105657-003
42-423-058209-00A 40.0 acre Arterberry Oil Unit Letter Agreement between Five Star
Tracts 1 (25.0), 2 (4.15), 3 Exploration and Caplex Energy, Inc. dated
(4.50) and 4 (6.35), from Surface Marcy 9, 1990, amended July 30, 1996.
to the stratigraphic equivalent
of the Base of the Rodessa AR-105657-004
Formation, found at approximately Arterberry Heirs Oil Unit Designation
7,340' in the C W Resources, Inc.
Arterberry Heirs No. 1 well, E. AR-105657-000
Daniels A-330 Survey, Smith Mid-Tex Joint Operating Agreement
County, Texas Shea Prospect Joint Operating Agreement
42-423-058210-00A 4.15 acre Tract 2 of 40.0 acre
Arterberry Oil Unit (4.15 acres
out of 25.50 acre tract described
in MD 322/435 DR), from Surface
to 7,340' in the C W Resources,
Inc. Arterberry Heir No. 1 well,
E. Daniels A-330 Survey, Smith
County, Texas
</TABLE>
Page 134 of 165
<PAGE> 161
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-057809-00A Ronnie Webb Thompson Interests, 7-11-97
33.33% WI Inc.
42-423-057809-00B Elaine Keeny 7-11-97
Thompson Interests,
Inc.
42-423-057809-00C Kenneth Webb 7-11-97
Thompson Interests,
Inc.
42-423-057809-00D Edith C. Webb 7-11-97
Thompson Interests,
Inc.
42-423-057810-00A J. L. Tweedy 7-20-97
Thompson Interests,
Inc.
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
Shea Prospect 42-423-057810-00B Martha Helen Sinclair Thompson Interests, 7-20-97
33.33% WI Inc.
42-423-057810-00C Jewel M. Simpson 7-20-97
Wagner & Brown, Ltd.
42-423-057810-00D John V. Sinclair 7-20-97 3995 289
Wagner & Brown, Ltd.
42-423-057810-00E James T. Sinclair 7-20-97 3995 289
Wagner & Brown, Ltd.
42-423-057810-00F Margaret C. Hamlin 7-25-97 3995 282
Wagner & Brown, Ltd.
42-423-057810-00G Roy Carpenter 7-25-97 3995 291
Wagner & Brown, Ltd.
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-057809-00A 71.52 acres, being tracts of AR-105657-000
33.33% WI 25.0, 16.52, 25.50 and 4.50 acres Mid-Tex Joint Operating Agreement
out of E. Caniels A-330 (Deed Shea Prospect Joint Operating Agreement
363/66 DR) Smith County, Texas
42-423-057809-00B 71.52 acres, being tracts of
25.0, 16.52, 25.50 and 4.50 acres
out of E. Caniels A-330 (Deed
363/66 DR) Smith County, Texas
42-423-057809-00C 71.52 acres, being tracts of
25.0, 16.52, 25.50 and 4.50 acres
out of E. Caniels A-330 (Deed
363/66 DR) Smith County, Texas
42-423-057809-00D 71.52 acres, being tracts of
25.0, 16.52, 25.50 and 4.50 acres
out of E. Caniels A-330 (Deed
363/66 DR) Smith County, Texas
42-423-057810-00A 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
Shea Prospect 42-423-057810-00B 27.441 acres out of E. Daniels AR-105657-00A
33.33% WI A-330 (MD 273/120 DR), Smith Shea Prospect Joint Operating Agreement
County, Texas
42-423-057810-00C 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
42-423-057810-00D 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
42-423-057810-00E 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
42-423-057810-00F 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
42-423-057810-00G 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
</TABLE>
Page 135 of 165
<PAGE> 162
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Shea Prospect 42-423-057810-00H Ann Sinclair Walker Wagner & Brown, Ltd. 7-20-97 3987 359
33.33% WI
42-423-057810-00I E. Faye Sinclair Wagner & Brown, Ltd. 7-20-97 4027 104
42-423-057810-00J Dr. Rayford Scott Wagner & Brown, Ltd. 7-20-97 4225 253
Jones
42-423-057811-00A Wagner & Brown, Ltd. 4-4-97 3987 376
Victorine W. Watson
42-423-057812-00A Wagner & Brown, Ltd. 6-4-97 4052 87
NationsBank of Texas,
N.A., Trustee u/w
42-423-057813-00A Milton E. Daniel Trust Wagner & Brown, Ltd. 4-4-97 3947 15
John H. Brogan, Jr.
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ---------------------- ----------------------------------- --------------------------------------------
<S> <C> <C> <C>
Shea Prospect 42-423-057810-00H 27.441 acres out of E. Daniels AR-105657-00A
33.33% WI A-330 (MD 273/120 DR), Smith Shea Prospect Joint Operating Agreement
County, Texas
42-423-057810-00I 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
42-423-057810-00J 27.441 acres out of E. Daniels
A-330 (MD 273/120 DR), Smith
County, Texas
42-423-057811-00A 30.38 acres in D. Shaw A-917
Survey, (Deed 1129/188 DR) Smith
County, Texas
42-423-057812-00A 49.79 acres in D. Shaw A-917
Survey (OGL 2288/479 DR) Smith
County, Texas
42-423-057813-00A 102.60 acres, being tracts of
69.90 (Deed 47/531 DR) and 20.0
acres (60.0 acre tract Deed &/426
LESS North 40.0 acres as
designated for unit for Roberson
No. 1 well) E. Daniel A-330
Survey and 12.70 acres (WD 57/93
DR) D. Shaw A-917 Survey, Smith
County, Texas
</TABLE>
Page 136 of 165
<PAGE> 163
EXHIBIT "A"
ATTACHED TO AND MADE A PART OF THAT CERTAIN PURCHASE AND
SALE AGREEMENT DATED EFFECTIVE AS OF
OCTOBER 1, 1998, BY AND BETWEEN ATLANTIC RICHFIELD COMPANY (ARCO)
AND FUTURE ACQUISITION 1995, LTD. (PURCHASER)
IN ADDITION TO ANY OTHER DEPTH LIMITATIONS EXPRESSED HEREIN,
IT IS THE EXPRESS INTENTION TO LIMIT THE DESCRIPTIONS
OF ARCO'S INTEREST (IF ANY), FROM THE SURFACE DOWN
TO THE BASE OF THE DEEPEST PRODUCING FORMATION
UPSHUR COUNTY
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
East Texas Field 42-459-000880-000 V. R. Wyatt Argo Royalty Company 4-29-31 83 610
E. A. Watts (8985) (Mineral Deed)
410968600
1.5625% RI
- --------------------------- ---------------------- ----------------------- ---------------------- ----------- --------- ---------
East Texas Field 42-459-000881-000 B. J. Claypool Argo Royalty Company 5-1-31 83 604
Webb #1 (Mineral Deed)
413546600
25% RI BPO
6.25% NRI BPO
40% RI APO
10% NRI APO
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
East Texas Field 42-459-000880-000 180 acres out of the C. H. Cooper
E. A. Watts (8985) (Mineral Deed) Survey, A-81, Upshur County,
410968600 Texas, being more particularly
1.5625% RI described in that certain Mineral
Deed dated April 29, 1931 and
recorded in Volume 83, Page 610,
Deed Records, Upshur County,
Texas.
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
East Texas Field 42-459-000881-000 70 acres of land on G. W. Hooper AR-104929
Webb #1 (Mineral Deed) H. R. Survey, being a part of Oil and Gas Lease dated July 19, 1994 between
413546600 Block 2, and more particularly Atlantic Richfield Company, Lessor, and Chinn
25% RI BPO described by metes and bounds in Exploration Company, Lessee, recorded in
6.25% NRI BPO Mineral Deed dated May 1, 1931, Volume 173, Page 158, Deed Records, Upshur
40% RI APO recorded in Volume 83, Page 604, County, Texas.
10% NRI APO Deed Records, Upshur County,
Texas.
</TABLE>
Page 137 of 165
<PAGE> 164
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-183-057630-00A Lottie F. Calhoun Family Amoco Production Co. 11/2/95 2895 234
(Cotton Valley Sand) Trust
E. F. Johnson Gas Unit (d)
411001300 42-183-057630-00B Virginia Rives Johnson Amoco Production Co. 10/12/95 2886 441
33.33% WI
42-183-057630-00C Jacquelyn H. Denney Amoco Production Co. 11/2/95 2895 232
42-183-057632-00A B. J. Barclay et ux et al Amoco Production Co. 11/2/95 2895 225
42-183-057632-00B James Ray Northcutt Amoco Production Co. 11/2/95 2895 228
42-183-057632-00C Myra Lynn Ray Roberts Amoco Production Co. 11/2/95 2982 263
42-183-057632-00D Leonard Frank Ray et al Amoco Production Co. 11/2/95 2982 266
42-183-057698-00A Mary S. Florence et al Amoco Production Co. 9/27/95 2936 278
42-183-057698-00B Tommie Faye Starr Amoco Production Co. 9/19/95 2886 415
42-183-057698-00C Eleanor Bankhead Florence, et al Amoco Production Co. 9/27/95 2886 435
42-183-057698-00D Virginia Gibson Starr Amoco Production Co. 9/19/95 2886 433
42-183-057698-00E Edith B. Lester Amoco Production Co. 9/19/95 2886 411
42-183-057699-00A Ron Dunbar et al Crown Resources Co. 3/18/96 2964 81
42-183-057699-00B G. R. Dunbar Crown Resources Co. 3/18/96 2957 555
42-183-057700-00A Leneve D. Bell Amoco Production Co. 9/19/95 2886 457
42-183-057700-00B Bessie Dunbar Dickson Amoco Production Co. 9/19/95 2886 459
42-183-057700-00C Kathleen D. Mincey Amoco Production Co. 9/19/95 2886 429
42-183-057700-00D Deanne Buchanan Amoco Production Co. 9/19/95 2895 254
42-183-057700-00E Judy Banks Amoco Production Co. 9/19/95 2895 245
42-183-057748-00A Mary Lou Weiss Amoco Production Co. 10/12/95 2895 219
42-183-057748-00B Robert G. Barry et al Amoco Production Co. 10/12/95 2886 453
42-183-057748-00C Jacqueline T. Garrett Amoco Production Co. 10/12/95 2886 447
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-183-057630-00A A tract or tracts of land located AR-105496
(Cotton Valley Sand) in Upshur County and Gregg Farmin Agreement dated December 12, 1996
E. F. Johnson Gas Unit (d) County, Texas, as more fully Between Amoco Production Company, Farmor,
411001300 42-183-057630-00B described in that certain And C W Resources, Inc., et al, Farmee
33.33% WI Assignment dated effective May
42-183-057630-00C 29, 1997, from Amoco Production AR-105498
Company to Atlantic Richfield Joint Operating Agreement dated December 12,
42-183-057632-00A Company, et al, recorded at 1996 between C W Resources, Inc., Operator,
Volume 296, Page 216, Official And Atlantic Richfield Company, et al,
42-183-057632-00B Records of Upshur County, Texas. non-operators
42-183-057632-00C LIMITED IN DEPTH FROM THE SURFACE AR-105498-005
DOWN TO 100' BELOW THE TOTAL Designation of Gas Unit dated effective June
42-183-057632-00D DEPTH OF THE C W RESOURCES E. F. 11, 1997, by and between C W Resources, Inc.
JOHNSON WELL. and Atlantic Richfield Company, et al
42-183-057698-00A
42-183-057698-00B
42-183-057698-00C
42-183-057698-00D
42-183-057698-00E
42-183-057699-00A
42-183-057699-00B
42-183-057700-00A
42-183-057700-00B
42-183-057700-00C
42-183-057700-00D
42-183-057700-00E
42-183-057748-00A
42-183-057748-00B
42-183-057748-00C
</TABLE>
Page 138 of 165
<PAGE> 165
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-183-057748-00D Mary Elizabeth Edwards Amoco Production Co. 10/12/95 2886 439
(Cotton Valley Sand)
E. F. Johnson Gas Unit (d) 42-183-057748-00E Mary Katherine Block Amoco Production Co. 10/12/95 2886 421
411001300
(continued) 42-183-057748-00F Ben Johnson III, Ttee Amoco Production Co. 10/12/95 2886 444
42-183-057748-00G Hughleen Dunbar Fenton Crown Resources Co. 3/15/96 2957 562
42-183-057748-00H G. R. Dunbar Crown Resources Co. 3/15/96 2957 551
42-183-057748-00I J. R. Dunbar et ux Crown Resources Co. 3/15/96 2964 89
42-183-057748-00J David Terry III Crown Resources Co. 5/1/97 File # 9710955
42-183-057748-00K Sara J. Struges Brian Crown Resources Co. 5/1/97 File # 9710956
42-183-057748-00L Paul L. Whaley, Jr. Crown Resources Co. 5/6/97 File # 9710959
42-183-057748-00M Thomas L. Whaley Crown Resources Co. 5/10/97 File # 9710965
42-183-057748-00N Cummings Royalty Crown Resources Co. 5/8/97 File # 9710966
Acquisition Co., Inc.
42-183-057748-00O Royalty Exchange, Inc. Crown Resources Co. 5/8/97 File # 9710653
42-183-057748-00P Mack Camp Crown Resources Co. 5/1/97 File # 9710952
42-183-057748-00Q Jo Margaret Pitman Crown Resources Co. 4/30/97 File # 9710958
42-183-057748-00R Sarah L. Boone Crown Resources Co. 5/1/97 File # 9712770
42-183-057748-00S Katherine E. Thompson Crown Resources Co. 5/1/97 File # 9710951
42-183-057748-00T Legacy Royalty, Ltd. Crown Resources Co. 4/25/97 File # 9712773
42-183-057748-00U William G. McCullough Crown Resources Co. 5-6-97 File # 9712766
42-183-057748-00V Gus and Katherine L. Crown Resources Co. 5-2-97 File # 9710651
Carter Trust
42-183-057748-00W Eva Jean Blount Crown Resources Co. 4-24-97 File # 9710652
42-183-057748-00X Elaine Markham Clanton Crown Resources Co. 4-24-97 File # 9710963
42-183-057748-00Y Linda S. Gray McMahon Crown Resources Co. 5-6-97 File # 9710762
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-183-057748-00D A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
E. F. Johnson Gas Unit (d) 42-183-057748-00E County, Texas, as more fully
411001300 described in that certain
(continued) 42-183-057748-00F Assignment dated effective May
29, 1997, from Amoco Production
42-183-057748-00G Company to Atlantic Richfield
Company, et al, recorded at
42-183-057748-00H Volume 296, Page 216, Official
Records of Upshur County, Texas.
42-183-057748-00I
LIMITED IN DEPTH FROM THE SURFACE
42-183-057748-00J DOWN TO 100' BELOW THE TOTAL
DEPTH OF THE C W RESOURCES E. F.
JOHNSON WELL.
42-183-057748-00K
42-183-057748-00L
42-183-057748-00M
42-183-057748-00N
42-183-057748-00O
42-183-057748-00P
42-183-057748-00Q
42-183-057748-00R
42-183-057748-00S
42-183-057748-00T
42-183-057748-00U
42-183-057748-00V
42-183-057748-00W
42-183-057748-00X
42-183-057748-00Y
</TABLE>
Page 139 of 165
<PAGE> 166
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-183-057748-00Z R. H. (Bobby) Smith Crown Resources Co. 4-15-97 File # 9708003
(Cotton Valley Sand)
E. F. Johnson Gas Unit (d) 42-183-057748-0AA Verner Kelly Crown Resources Co. 4-15-97 File # 9710954
411001300
(continued) 42-183-057748-0AB Janet E. Sprout Crown Resources Co. 4-24-97 File # 9710950
42-183-057748-0AC Elizabeth Ellen Wyche Crown Resources Co. 4-16-97 File # 9708002
Robison
42-183-057748-0AD James Regan Wyche Crown Resources Co. 4-22-97 File # 9710957
42-183-057748-0AE Jean Terrell Crown Resources Co. 4-24-97 File # 9710964
42-183-057748-0AF Jane F. Terrell Crown Resources Co. 4-24-97 File # 9710949
42-183-057752-00A Robert H. Smith Amoco Production Co. 9-25-95 2886 431
42-183-057752-00B Marjorie Jekot Amoco Production Co. 9-25-95 2886 413
42-183-057752-00C Margaret C. Smead Amoco Production Co. 9-25-95 2886 461
42-183-057752-00D Jerry Tillery Crown Resources Co. 4-1-97 File # 9708001
42-183-057752-00E Joe Neil Tillery Crown Resources Co. 4-1-97 File # 9708000
42-183-057752-00F Imogene Brogdon Crown Resources Co. 4-1-97 File # 9710960
42-183-057752-00G Sandra Tillery Bass Crown Resources Co. 4-1-97 File # 9707081
42-183-057752-00H Louise Tillery Cornell Crown Resources Co. 4-1-97 File # 9707082
42-183-057752-00I Bryan T. Tillery Crown Resources Co. 4-1-97 File # 9712769
42-183-057752-00J Melonie Stanley Crown Resources Co. 4-1-97 File # 9707080
42-183-057754-00A Elnora H. Price Amoco Production Co. 9-19-95 2886 397
42-183-057754-00B Minnie Flanders Douglas Amoco Production Co. 9-19-95 2886 393
42-183-057754-00C Sue Boyd Duszik Amoco Production Co. 9-19-95 2886 401
42-183-057754-00D George Watson Fair Amoco Production Co. 9-19-95 2886 395
42-183-057754-00E Frances Flanders Amoco Production Co. 9-19-95 2886 389
42-183-057754-00F Frances Ray Hill Elliott Amoco Production Co. 9-19-95 2886 449
42-183-057754-00G Mary R. Corley Amoco Production Co. 9-19-95 2910 441
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-183-057748-00Z A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
E. F. Johnson Gas Unit (d) 42-183-057748-0AA County, Texas, as more fully
411001300 described in that certain
(continued) 42-183-057748-0AB Assignment dated effective May
29, 1997, from Amoco Production
42-183-057748-0AC Company to Atlantic Richfield
Company, et al, recorded at
Volume 296, Page 216, Official
42-183-057748-0AD Records of Upshur County, Texas.
42-183-057748-0AE LIMITED IN DEPTH FROM THE SURFACE
DOWN TO 100' BELOW THE TOTAL
42-183-057748-0AF DEPTH OF THE C W RESOURCES E. F.
JOHNSON WELL.
42-183-057752-00A
42-183-057752-00B
42-183-057752-00C
42-183-057752-00D
42-183-057752-00E
42-183-057752-00F
42-183-057752-00G
42-183-057752-00H
42-183-057752-00I
42-183-057752-00J
42-183-057754-00A
42-183-057754-00B
42-183-057754-00C
42-183-057754-00D
42-183-057754-00E
42-183-057754-00F
42-183-057754-00G
</TABLE>
Page 140 of 165
<PAGE> 167
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-183-057754-00H Cecil Flanders Amoco Production Co. 9-19-95 2886 399
(Cotton Valley Sand)
E. F. Johnson Gas Unit (d) 42-183-057754-00I Jan Hooker Amoco Production Co. 9-19-95 2886 417
411001300
(continued) 42-183-057754-00J Michael E. Curtis et al Amoco Production Co. 9-19-95 2886 391
42-183-057754-00K Bettie W. Ray Walden Amoco Production Co. 9-19-95 2910 439
42-183-057758-00A James Samuel Davis Crown Resources Co. 3-28-97 3071 298
42-459-057641-00A Judith M. Wrucke R. Lacy, Inc. 3-17-95 2845 492
42-459-057641-00B Claude Graves, III R. Lacy, Inc. 3-29-95 2845 487
42-459-057641-00C Michael Andrew Stieren R. Lacy, Inc. 8-6-94 171 395
42-459-057641-00D Jennifer L. Stieren R. Lacy, Inc. 8-6-94 171 398
42-459-057641-00E Georgia Ann Stieren R. Lacy, Inc. 8-6-94 171 401
42-459-057641-00F Doris K. Ehrenberg R. Lacy, Inc. 3-17-95 196 212
42-459-057641-00G Gayla S. Graves R. Lacy, Inc. 3-17-95 196 220
42-459-057641-00H Claude Graves, III R. Lacy, Inc. 3-17-95 196 216
42-459-057705-00A Annette Felsenthal, et al R. Lacy, Inc. 8-30-94 171 379
42-459-057705-00B Mary Lou Weiss R. Lacy, Inc. 8-3-94 167 585
42-459-057705-00C William T. Lee R. Lacy, Inc. 7-27-95 200 788
42-459-057705-00D Bessie D. Dickson Crown Resources Co. 4-26-96 225 909
42-459-057705-00E Jeanne F. Jones Crown Resources Co. 5-8-96 224 952
42-459-057705-00F Helen G. Taft Crown Resources Co. 5-3-96 224 989
42-459-057705-00G Grace B. Ward Crown Resources Co. 4-24-96 224 993
42-459-057705-00H Alfred M. Yeatts Crown Resources Co. 4-25-96 224 997
42-459-057705-00I Maydelle Drake Crown Resources Co. 4-25-96 224 980
42-459-057705-00J Bobbie Preddy Schleimer, Gdn Amoco Production Co. 6-4-96 229 225
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-183-057754-00H A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
E. F. Johnson Gas Unit (d) 42-183-057754-00I County, Texas, as more fully
411001300 described in that certain
(continued) 42-183-057754-00J Assignment dated effective May
29, 1997, from Amoco Production
42-183-057754-00K Company to Atlantic Richfield
Company, et al, recorded at
42-183-057758-00A Volume 296, Page 216, Official
Records of Upshur County, Texas.
42-459-057641-00A
LIMITED IN DEPTH FROM THE SURFACE
42-459-057641-00B DOWN TO 100' BELOW THE TOTAL
DEPTH OF THE C W RESOURCES E. F.
42-459-057641-00C JOHNSON WELL.
42-459-057641-00D
42-459-057641-00E
42-459-057641-00F
42-459-057641-00G
42-459-057641-00H
42-459-057705-00A
42-459-057705-00B
42-459-057705-00C
42-459-057705-00D
42-459-057705-00E
42-459-057705-00F
42-459-057705-00G
42-459-057705-00H
42-459-057705-00I
42-459-057705-00J
</TABLE>
Page 141 of 165
<PAGE> 168
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057706-00A Charles Smith R. Lacy, Inc. 8-9-94 168 252
(Cotton Valley Sand)
E. F. Johnson Gas Unit (d) 42-459-057706-00B Peter C. Johnson R. Lacy, Inc. 6-3-94 164 929
411001300
(continued) 42-459-057706-00C Mary G. Collier R. Lacy, Inc. 6-3-94 164 919
42-459-057706-00D Mary E. Johnson R. Lacy, Inc. 6-3-94 164 932
42-459-057706-00E Edward M. Johnson R. Lacy, Inc. 6-3-94 164 943
42-459-057706-00F Clifford Lee Smith R. Lacy, Inc. 8-9-94 169 505
42-459-057706-00G Frank H. Smith, Jr. R. Lacy, Inc. 8-9-94 171 404
42-459-057706-00H Bernie Johnson Williams R. Lacy, Inc. 6-3-94 163 421
42-459-057706-00I Barbara S. Carpenter R. Lacy, Inc. 8-9-94 174 163
42-459-057706-00J J. T. Johnson R. Lacy, Inc. 6-3-94 164 937
42-459-057711-00A Frances Bryant, et al R. Byron Roach, Ttee 7-27-94 169 212
42-459-057711-00B Alpha Earl Swink Burke R. Byron Roach, Ttee 7-27-94 169 214
42-459-057711-00C Kyal Williams, Agent R. Byron Roach, Ttee 7-27-94 169 291
42-459-057711-00D Catherine L. Gilbert et al R. Byron Roach, Ttee 7-27-94 169 223
42-459-057711-00E George Grogan R. Byron Roach, Ttee 7-27-94 169 225
42-459-057711-00F Charles H. Mills R. Byron Roach, Ttee 7-27-94 169 252
42-459-057711-00G Rochelle Sohl Sanders R. Byron Roach, Ttee 7-28-94 172 776
42-459-057711-00H James Richardson Sohl R. Byron Roach, Ttee 7-28-94 172 774
42-459-057711-00I Sydonia Sonnenburg R. Byron Roach, Ttee 7-27-94 169 280
42-459-057711-00J Robin Sohl Ritchie R. Byron Roach, Ttee 7-28-94 169 278
42-459-057713-00A Chieftain Exploration Co., Amoco Production Co 11-25-96 245 371
Inc.
42-459-057719-00A Matt S. McKenzie R. Byron Roach, Ttee 10-2-94 185 946
42-459-057742-000 James Earl Andrews et al Amoco Production Co. 12-28-95 214 1
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057706-00A A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
E. F. Johnson Gas Unit (d) 42-459-057706-00B County, Texas, as more fully
411001300 described in that certain
(continued) 42-459-057706-00C Assignment dated effective May
29, 1997, from Amoco Production
42-459-057706-00D Company to Atlantic Richfield
Company, et al, recorded at
42-459-057706-00E Volume 296, Page 216, Official
Records of Upshur County, Texas.
42-459-057706-00F
LIMITED IN DEPTH FROM THE SURFACE
42-459-057706-00G DOWN TO 100' BELOW THE TOTAL
DEPTH OF THE C W RESOURCES E. F.
42-459-057706-00H JOHNSON WELL.
42-459-057706-00I
42-459-057706-00J
42-459-057711-00A
42-459-057711-00B
42-459-057711-00C
42-459-057711-00D
42-459-057711-00E
42-459-057711-00F
42-459-057711-00G
42-459-057711-00H
42-459-057711-00I
42-459-057711-00J
42-459-057713-00A
42-459-057719-00A
42-459-057742-000
</TABLE>
Page 142 of 165
<PAGE> 169
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field Unknown Derek Sean Kowalke Crown Resources Co. 4-2-97 File # 9710953
(Cotton Valley Sand)
E. F. Johnson Gas Unit (d) Unknown J. Patterson Lawson Crown Resources Co. 4-25-97 File # 9712765
411001300
(continued) Unknown Bank One Texas, Trustee Crown Resources Co. 5-8-97 File # 9710969
Unknown Judy Gray Bagheri Crown Resources Co. 6-2-97 File # 9712768
Unknown Terry W. Lindsey Crown Resources Co. 6-2-97 File # 9715541
Unknown Arthur L. Anderson Crown Resources Co. 6-2-97 File # 9713777
Unknown Chevron U.S.A., Inc. Amoco Production Co. 2-1-97 249 92
Unknown Coastal Oil & Gas Corp. Crown Resources Co. 6-10-97 263 835
Unknown Catherine M. Richard Crown Resources Co. 5-2-97 File # 9712767
Unknown Doris P. Crowley R. Lacy, Inc. 7-25-94 168 233
Unknown Nations Bank of Texas, N.A. Amoco Production Co. 10-5-94 2756 15
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
Glenwood Field 42-459-057734-000 Marie Lock Amoco Production Co. 2-13-96 216 127
(Cotton Valley Sand)
Petty Gas Unit (d) 42-459-057696-00A Robert H. Petty Amoco Production Co. 7-13-95 199 229
415000700
33.33% WI 42-459-057696-00B John C. Sans Crown Resources Co. 7-18-95 197 729
42-459-057696-00C James Elder Willeford Amoco Production Co. 7-13-95 197 749
42-459-057696-00D Mildred Porter Penick Amoco Production Co. 7-21-95 197 717
42-459-057696-00E Calvin B. Willeford Amoco Production Co. 7-13-95 199 249
42-459-057696-00F Sandra Walker Martin Amoco Production Co. 7-20-95 199 218
42-459-057696-00G Jimmy L. Walker Amoco Production Co. 7-20-95 199 247
42-459-057696-00H B.J. Porter, Jr. Amoco Production Co. 7-21-95 199 231
42-459-057696-00I Teresa Mahaffey Amoco Production Co. 7-13-95 199 216
42-459-057696-00J Clairene R. Dunn Amoco Production Co. 7-13-95 201 524
42-459-057696-00K Mary Jene Richardson Amoco Production Co. 7-13-95 197 720
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field Unknown A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
E. F. Johnson Gas Unit (d) Unknown County, Texas, as more fully
411001300 described in that certain
(continued) Unknown Assignment dated effective May
29, 1997, from Amoco Production
Unknown Company to Atlantic Richfield
Company, et al, recorded at
Unknown Volume 296, Page 216, Official
Records of Upshur County, Texas.
Unknown
LIMITED IN DEPTH FROM THE SURFACE
Unknown DOWN TO 100' BELOW THE TOTAL
DEPTH OF THE C W RESOURCES E. F.
Unknown JOHNSON WELL.
Unknown
Unknown
Unknown
- --------------------------- ------------------ ----------------------------------- ------------------------------------
Glenwood Field 42-459-057734-000 A tract or tracts of land located AR-105496
(Cotton Valley Sand) in Upshur County, Texas, as more Farmin Agreement dated December 12, 1996
Petty Gas Unit (d) 42-459-057696-00A fully described in that certain Between Amoco Production Company, Farmor,
415000700 Assignment dated effective And C W Resources, Inc., et al, Farmee
33.33% WI 42-459-057696-00B January 22, 1997, from Amoco
Production Company to Atlantic AR-105498
42-459-057696-00C Richfield Company, et al, Joint Operating Agreement dated December 12,
recorded at Volume 296, Page 233, 1996 between C W Resources, Inc., Operator,
42-459-057696-00D Official Records of Upshur And Atlantic Richfield Company, et al,
County, Texas. non-operators
42-459-057696-00E
LIMITED FROM THE SURFACE DOWN TO AR-105498-006
42-459-057696-00F 100' BELOW THE TOTAL DEPTH Designation of Gas Unit dated effective April
DRILLED IN THE C W RESOURCES 3, 1997, by and between C W Resources, Inc.
42-459-057696-00G PETTY GAS UNIT NO. 1 WELL. and Atlantic Richfield Company, et al
42-459-057696-00H
42-459-057696-00I
42-459-057696-00J
42-459-057696-00K
</TABLE>
Page 143 of 165
<PAGE> 170
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057696-00L Jimmie D. Hall Amoco Production Co. 7-13-95 197 695
(Cotton Valley Sand)
Petty Gas Unit (d) 42-459-057696-00M Norma J. Marshall et al Amoco Production Co. 7-20-95 203 447
415000700
(continued) 42-459-057696-00N C. Dean Walker Amoco Production Co. 2-23-96 218 553
42-459-057696-00O Kenneth H. Perry et ux Amoco Production Co. 12-6-96 244 317
42-459-057783-00A Margaret C. Leifeste Amoco Production Co. 4-22-96 222 898
42-459-057783-00B Shannon Dykes, et al Amoco Production Co. 4-30-96 224 839
42-459-057783-00C James Rust Crosby Amoco Production Co. 4-26-96 224 847
42-459-057783-00D H. D. Fullbright Amoco Production Co. 1-7-97 250 611
42-459-057783-00E Nancy T. Stembridge Amoco Production Co. 1-7-97 256 808
42-459-057783-00F Florence Lindvall Amoco Production Co. 1-7-97 247 365
42-459-057784-00A D. T. Gordon Amoco Production Co. 12-20-96 245 335
42-459-057784-00B Mary Beth Heiserman Amoco Production Co. 12-20-96 246 83
42-459-057784-00C Clyde H. Gordon Amoco Production Co. 12-20-96 250 680
42-459-057628-00A Kenneth H. Perry et ux Amoco Production Co. 1-19-96 214 480
42-459-057649-00A Margaret Goldreyer Amoco Production Co. 3-13-95 188 978
42-459-057649-00B Adam Rubey Amoco Production Co. 3-13-95 189 402
42-459-057649-00C Stuart Bourne Amoco Production Co. 3-13-95 187 965
42-459-057649-00D Lowe Figour Amoco Production Co. 3-13-95 189 359
42-459-057649-00E Arthur C. Rubey, III Amoco Production Co. 3-13-95 189 399
42-459-057652-00A Charles Snider et ux Amoco Production Co. 3-30-95 188 1000
42-459-057652-00B Dorothy Snider Bond Amoco Production Co. 3-30-95 189 345
42-459-057652-00C Debbie Snider Petta Amoco Production Co. 3-30-95 188 984
42-459-057652-00D Karen Snider Williams Amoco Production Co. 3-30-95 189 402
42-459-057652-00E Susan Snider Turner Amoco Production Co. 3-30-95 195 965
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057696-00L A tract or tracts of land located
(Cotton Valley Sand) in Upshur County, Texas, as more
Petty Gas Unit (d) 42-459-057696-00M fully described in that certain
415000700 Assignment dated effective
(continued) 42-459-057696-00N January 22, 1997, from Amoco
Production Company to Atlantic
42-459-057696-00O Richfield Company, et al,
recorded at Volume 296, Page 233,
42-459-057783-00A Official Records of Upshur
County, Texas.
42-459-057783-00B
LIMITED FROM THE SURFACE DOWN TO
42-459-057783-00C 100' BELOW THE TOTAL DEPTH
DRILLED IN THE C W RESOURCES
42-459-057783-00D PETTY GAS UNIT NO. 1 WELL.
42-459-057783-00E
42-459-057783-00F
42-459-057784-00A
42-459-057784-00B
42-459-057784-00C
42-459-057628-00A
42-459-057649-00A
42-459-057649-00B
42-459-057649-00C
42-459-057649-00D
42-459-057649-00E
42-459-057652-00A
42-459-057652-00B
42-459-057652-00C
42-459-057652-00D
42-459-057652-00E
</TABLE>
Page 144 of 165
<PAGE> 171
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057652-00G William B. Rubey Estate Amoco Production Co. 3-13-95 188 995
(Cotton Valley Sand)
Petty Gas Unit (d) 42-459-057652-00H Christina Rubey Baar Amoco Production Co. 3-13-95 188 971
415000700
(continued) 42-459-057652-00I Marion Seward Rubey Amoco Production Co. 3-13-95 187 1008
42-459-057652-00J Robert Neal Rubey Amoco Production Co. 3-13-95 191 300
42-459-057652-00K William B. Rubey Jr. Est Amoco Production Co. 3-13-95 188 988
42-459-057670-00A George S. Heyer, Jr. Amoco Production Co. 4-10-96 226 737
42-459-057670-00B Henri L. Tallichet Amoco Production Co. 4-10-96 222 912
42-459-057670-00C George S. Tallichet Amoco Production Co. 4-10-96 224 842
42-459-057670-00D Robert L. Bradley et al Amoco Production Co. 3-25-96 222 892
42-459-057757-00A Marian Lyeth Davis Amoco Production Co. 3-13-95 189 352
42-459-057785-00A Goodrich-Malloy Trust Crown Resources Co. 2-10-97 253 237
42-459-057785-00B John F. Malloy et al Crown Resources Co. 6-3-97 264 508
42-459-057785-00C Robert R. Goodrich Amoco Production Co. 10-9-97 275 57
Unknown Donald R. Burgett et ux C W Resources Co. 1-3-97 247 948
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057652-00G A tract or tracts of land located
(Cotton Valley Sand) in Upshur County, Texas, as more
Petty Gas Unit (d) 42-459-057652-00H fully described in that certain
415000700 Assignment dated effective
(continued) 42-459-057652-00I January 22, 1997, from Amoco
Production Company to Atlantic
42-459-057652-00J Richfield Company, et al,
recorded at Volume 296, Page 233,
42-459-057652-00K Official Records of Upshur
County, Texas.
42-459-057670-00A
LIMITED FROM THE SURFACE DOWN TO
42-459-057670-00B 100' BELOW THE TOTAL DEPTH
DRILLED IN THE C W RESOURCES
42-459-057670-00C PETTY GAS UNIT NO. 1 WELL.
42-459-057670-00D
42-459-057757-00A
42-459-057785-00A
42-459-057785-00B
42-459-057785-00C
Unknown
</TABLE>
Page 145 of 165
<PAGE> 172
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057704-00A Sylvia M. Fowler R. Byron Roach, Trustee 8-9-94 169 221
(Cotton Valley Sand)
Rose Kirkpatrick Gas Unit
(d)
410900700
33.33% WI BPO
25.00% NRI BPO
23.331% WI APO
17.50% NRI APO
42-459-057704-00B Cathy Moore Hunter R. Byron Roach, Trustee 8-9-94 169 232
42-459-057704-00C Nicky L. Roberts, et al R. Byron Roach, Trustee 8-9-94 169 276
42-459-057706-00A Charles Smith R. Lacy, Inc. 8-9-94 168 252
42-459-057706-00B Peter C. Johnson R. Lacy, Inc. 6-3-94 164 929
42-459-057706-00C Mary G. Collier R. Lacy, Inc. 6-3-94 164 919
42-459-057706-00D Mary E. Johnson R. Lacy, Inc. 6-3-94 164 932
42-459-057706-00E Edward M. Johnson R. Lacy, Inc. 6-3-94 164 943
42-459-057706-00F Clifford Lee Smith R. Lacy, Inc. 8-9-94 169 505
42-459-057706-00G Frank H. Smith, Jr. R. Lacy, Inc. 8-9-94 171 404
42-459-057706-00H Bernie Lee Johnson Williams R. Lacy, Inc. 6-3-94 163 421
42-459-057706-00I Barbara S. Carpenter R. Lacy, Inc. 8-9-94 171 404
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057704-00A A tract or tracts of land located AR-105496
(Cotton Valley Sand) in Upshur County and Gregg Farmin Agreement dated December 12, 1996.
Rose Kirkpatrick Gas Unit County, Texas, as more fully
(d) described in that certain AR-105498
410900700 unrecorded Assignment dated Joint Operating Agreement dated December 12,
33.33% WI BPO effective May 1, 1997, from Amoco 1996.
25.00% NRI BPO Production Company to Atlantic
23.331% WI APO Richfield Company
17.50% NRI APO
42-459-057704-00B LIMITED TO THAT INTERVAL FROM THE
SURFACE DOWN TO 100' BELOW THE
42-459-057704-00C TOTAL DEPTH OF THE C W RESOURCES
ROSE KIRKPATRICK GAS UNIT WELL
42-459-057706-00A NO. 1.
42-459-057706-00B
42-459-057706-00C
42-459-057706-00D
42-459-057706-00E
42-459-057706-00F
42-459-057706-00G
42-459-057706-00H
42-459-057706-00I
</TABLE>
Page 146 of 165
<PAGE> 173
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057706-00J J. T. Johnson R. Lacy, Inc. 6-3-94 164 937
(Cotton Valley Sand)
Rose Kirkpatrick Gas Unit 42-459-057740-00A Kathleen D. Mincey R. Lacy, Inc. 6-6-94 164 436
(d)
410900700 42-459-057740-00B Nancy Sain Henderson R. Lacy, Inc. 6-6-94 164 434
(continued)
42-459-057740-00C Judy D. Banks R. Lacy, Inc. 6-6-94 164 423
42-459-057740-00D Deanne D. Buchanan R. Lacy, Inc. 6-6-94 164 426
42-459-057740-00E A. R. Sweeney R. Lacy, Inc. 6-6-94 162 419
42-459-057740-00F LeNeve Dunbar Bell R. Lacy, Inc. 6-6-94 163 399
42-459-057740-00G Rowena Chodrow R. Lacy, Inc. 6-22-94 164 960
42-459-057740-00H Allan Earl Wisenbaker, Amoco Production Co. 7-17-96 235 51
et al
42-459-057740-00I The Newby Foresee Trust, J. Don Westbrook 5-25-94 168 285
et al
42-459-057741-00A Preston D. Kiel R. Lacy, Inc. 9-19-97 168 129
42-459-057741-00B Kaplan Partners, Ltd. R. Lacy, Inc. 6-9-94 164 974
42-459-057741-00C Preston D. Kiel R. Byron Roach, Trustee 8-9-94 169 243
42-459-057741-00D Nancy Sain Henderson Crown Resources Co. 2-18-97 253 253
42-459-057741-00E Doris C. Rea Crown Resources Co. 2-17-97 253 278
42-459-057741-00F Cole McCrory Crown Resources Co. 2-17-97 257 341
42-459-057741-00G Mary Bell Cherry Crown Resources Co. 2-12-97 257 347
42-459-057741-00H Cerre B. Diboll Crown Resources Co. 2-17-97 257 339
42-459-057741-00I Lewis B. Pitts Crown Resources Co. 2-18-97 253 276
42-459-057741-00J Pat McCrory Crown Resources Co. 2-17-97 261 334
42-459-057741-00K Rebecca Jenkins Crown Resources Co. 2-27-97 257 377
42-459-057741-00L Melonie Stanley Crown Resources Co. 2-27-97 254 883
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057706-00J A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
Rose Kirkpatrick Gas Unit 42-459-057740-00A County, Texas, as more fully
(d) described in that certain
410900700 42-459-057740-00B unrecorded Assignment dated
(continued) effective May 1, 1997, from Amoco
42-459-057740-00C Production Company to Atlantic
Richfield Company
42-459-057740-00D
LIMITED TO THAT INTERVAL FROM THE
42-459-057740-00E SURFACE DOWN TO 100' BELOW THE
TOTAL DEPTH OF THE C W RESOURCES
42-459-057740-00F ROSE KIRKPATRICK GAS UNIT WELL
NO. 1.
42-459-057740-00G
42-459-057740-00H
42-459-057740-00I
42-459-057741-00A
42-459-057741-00B
42-459-057741-00C
42-459-057741-00D
42-459-057741-00E
42-459-057741-00F
42-459-057741-00G
42-459-057741-00H
42-459-057741-00I
42-459-057741-00J
42-459-057741-00K
42-459-057741-00L
</TABLE>
Page 147 of 165
<PAGE> 174
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057741-00M George G. Vaught, Jr. Crown Resources Co. 2-28-97 253 282
(Cotton Valley Sand)
Rose Kirkpatrick Gas 42-459-057741-00N McCulliss Resources Company, Crown Resources Co. 2-28-97 253 274
Unit (d) Inc.
410900700
(continued) 42-459-057741-00O Bryan T. Tillery Crown Resources Co. 2-27-97 257 343
42-459-057741-00P C. O. Christian Crown Resources Co. 5-7-97 269 563
42-459-057741-00Q Imogene Brogdon Crown Resources Co. 2-16-97 269 561
42-459-057741-00R Jerry Tillery Crown Resources Co. 2-27-97 257 333
42-459-057741-00S Louise Tillery Cornell Crown Resources Co. 2-27-97 257 335
42-459-057741-00T Joe Neil Tillery Crown Resources Co. 2-26-97 253 280
42-459-057741-00U Sandra Tillery Bass Crown Resources Co. 2-25-97 253 233
42-459-057741-00V Harriett I. Bryant Crown Resources Co. 3-7-97 257 331
42-183-057746-00A Burford I. King, et al Amoco Production Co. 11-1-95 2895 257
42-183-057747-00A Martha Rose Biggs, Trustee Amoco Production Co. 11-1-95 2895 252
42-183-057747-00B Leneve D. Bell Amoco Production Co. 10-26-95 2886 423
42-183-057747-00C Deanne Buchanan Amoco Production Co. 10-26-95 2886 386
42-183-057747-00D Stanley C. Draper Amoco Production Co. 11-1-95 2895 250
42-183-057747-00E John David Draper Amoco Production Co. 11-1-95 2895 248
42-183-057747-00F Judy Banks Amoco Production Co. 10-26-95 2895 242
42-183-057747-00G Bessie D. Dickson Amoco Production Co. 10-26-95 2886 425
42-183-057747-00H Kathleen D. Mincey Amoco Production Co. 10-26-95 2952 284
42-183-057749-00A Ron Dunbar, et al Crown Resources Co. 3-15-96 2964 85
42-183-057751-00A Anne M. Ferguson Amoco Production Co. 10-11-95 2895 221
42-183-057751-00B Nannie Jane Sims Amoco Production Co. 10-11-95 2886 455
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057741-00M A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
Rose Kirkpatrick Gas 42-459-057741-00N County, Texas, as more fully
Unit (d) described in that certain
410900700 unrecorded Assignment dated
(continued) 42-459-057741-00O effective May 1, 1997, from Amoco
Production Company to Atlantic
42-459-057741-00P Richfield Company
42-459-057741-00Q LIMITED TO THAT INTERVAL FROM THE
SURFACE DOWN TO 100' BELOW THE
42-459-057741-00R TOTAL DEPTH OF THE C W RESOURCES
ROSE KIRKPATRICK GAS UNIT WELL
42-459-057741-00S NO. 1.
42-459-057741-00T
42-459-057741-00U
42-459-057741-00V
42-183-057746-00A
42-183-057747-00A
42-183-057747-00B
42-183-057747-00C
42-183-057747-00D
42-183-057747-00E
42-183-057747-00F
42-183-057747-00G
42-183-057747-00H
42-183-057749-00A
42-183-057751-00A
42-183-057751-00B
</TABLE>
Page 148 of 165
<PAGE> 175
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-183-057751-00C Lex B. Smith Amoco Production Co. 10-11-95 2895 223
(Cotton Valley Sand)
Rose Kirkpatrick Gas Unit 42-183-057751-00D Allan Earl Wisenbaker, Amoco Production Co. 7-17-96 2989 627
(d) et al
410900700
(continued) 42-183-057753-00A Marvin H. Cowan, Jr. Amoco Production Co. 9-20-95 2886 427
42-183-057753-00B Roy O. Cowan Amoco Production Co. 9-20-95 2895 238
42-183-057753-00C Carol Hooper Amoco Production Co. 9-20-95 2886 403
42-183-057753-00D Ann Hooper Stacy Amoco Production Co. 9-20-95 2886 406
42-183-057753-00E Susan Schmidt Amoco Production Co. 9-20-95 2886 409
42-183-057753-00F W. R. Hughes Trust Amoco Production Co. 9-20-95 2886 451
42-183-057753-00G James Warren Cowan Amoco Production Co. 10-17-95 2886 419
42-183-057753-00H Carol C. Prinz, et al Amoco Production Co. 9-20-95 2895 236
42-183-057753-00I James Earl Andrews, et al Amoco Production Co. 12-28-95 2924 368
42-183-057753-00J Robert L. Cowan Amoco Production Co. 10-17-95 2895 240
42-183-057753-00K East Texas Royalty and R. Lacy, Inc. 1-20-95 2790 63
Investment Co.
42-183-057755-00A Blaine Aric Amoco Production Co. 9-19-95 2952 290
42-183-057755-00B Vivian Elise Dulling Amoco Production Co. 9-19-95 2910 435
42-183-058125-00A Boatmen's Trust Co. of Crown Resources Co. 5-6-97 272 240
Arkansas, et al
42-459-057785-00A Goodrich-Malloy Trust Crown Resources Co. 2-10-97 253 237
42-459-057785-00B John F. Malloy, et al Crown Resources Co. 6-3-97 264 508
42-459-057785-00C Robert R. Goodrich Amoco Production Co. 10-9-97 296 233
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-183-057751-00C A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
Rose Kirkpatrick Gas Unit 42-183-057751-00D County, Texas, as more fully
(d) described in that certain
410900700 unrecorded Assignment dated
(continued) 42-183-057753-00A effective May 1, 1997, from Amoco
Production Company to Atlantic
42-183-057753-00B Richfield Company
42-183-057753-00C LIMITED TO THAT INTERVAL FROM THE
SURFACE DOWN TO 100' BELOW THE
42-183-057753-00D TOTAL DEPTH OF THE C W RESOURCES
ROSE KIRKPATRICK GAS UNIT WELL
42-183-057753-00E NO. 1.
42-183-057753-00F
42-183-057753-00G
42-183-057753-00H
42-183-057753-00I
42-183-057753-00J
42-183-057753-00K
42-183-057755-00A
42-183-057755-00B
42-183-058125-00A
42-459-057785-00A
42-459-057785-00B
42-459-057785-00C
</TABLE>
Page 149 of 165
<PAGE> 176
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057625-00A Phillip D. Sensing, et al Amoco Production Co. 2/13/96 218 545
(Cotton Valley Sand)
Rubey Estate Gas Unit (d) 42-459-057625-00B Edgar B. Sensing Amoco Production Co. 2/13/96 218 547
416000200
27.204487% WI 42-459-057628-00A Kenneth H. Perry et ux Amoco Production Co. 1/19/96 214 480
42-459-057649-00A Margaret Goldreyer Amoco Production Co. 3/13/95 188 978
42-459-057649-00B Adam Rubey Amoco Production Co. 3/13/95 189 402
42-459-057649-00C Stuart Bourne Amoco Production Co. 3/13/95 187 965
42-459-057649-00D Lowe Figour Amoco Production Co. 3/13/95 189 359
42-459-057649-00E Arthur C. Rubey, III Amoco Production Co. 3/13/95 189 399
42-459-057652-00A Charles Snider et ux Amoco Production Co. 3/30/95 188 1000
42-459-057652-00B Dorothy Snider Bond Amoco Production Co. 3/30/95 189 345
42-459-057652-00C Debbie Snider Petta Amoco Production Co. 3/30/95 188 984
42-459-057652-00D Karen Snider Williams Amoco Production Co. 3/30/95 189 409
42-459-057652-00E Susan Snider Turner Amoco Production Co. 3/30/95 195 46
42-459-057652-00F Joe Snider et ux Lajuan Amoco Production Co. 3/30/95 188 1004
42-459-057652-00G William B. Rubey Estate Amoco Production Co. 3/13/95 188 995
42-459-057652-00H Christina Rubey Baar Amoco Production Co. 3/13/95 188 971
42-459-057652-00I Marion Seward Rubey Amoco Production Co. 3/13/95 187 1008
42-459-057652-00J Robert Neal Rubey Amoco Production Co. 3/13/95 191 300
42-459-057652-00K William B. Rubey Jr. Est Amoco Production Co. 3/13/95 188 988
42-459-057653-000 Larry Dean Bishop et ux Amoco Production Co. 12/11/96 247 356
42-459-057654-00A Lee Hall Tillman Amoco Production Co. 12/6/96 247 358
42-459-057655-00A ETEX Telephone Co-op Amoco Production Co. 4/10/95 222 896
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057625-00A A tract or tracts of land located AR-105496
(Cotton Valley Sand) in Upshur County, Texas, as more Farmin Agreement dated December 12, 1996
Rubey Estate Gas Unit (d) 42-459-057625-00B fully described in that certain Between Amoco Production Company, Farmor,
416000200 Assignment dated effective March And C W Resources, Inc., et al, Farmee
27.204487% WI 42-459-057628-00A 1, 1997, from Amoco Production
Company to Atlantic Richfield AR-105498
42-459-057649-00A Company, et al, recorded at Joint Operating Agreement dated December 12,
Volume 296, Page 245, Official 1996 between C W Resources, Inc., Operator,
42-459-057649-00B Records of Upshur County, Texas. And Atlantic Richfield Company, et al,
non-operators
42-459-057649-00C LIMITED IN DEPTH FROM THE SURFACE
DOWN TO 100' BELOW THE DEPTH AR-105498-003
42-459-057649-00D DRILLED IN THE C W RESOURCES Designation of Gas Unit dated effective
RUBEY ESTATE GAS UNIT NO. 1 WELL. December 12, 1996 between C W Resources, Inc.
42-459-057649-00E and Atlantic Richfield Company, et al
42-459-057652-00A
42-459-057652-00B
42-459-057652-00C
42-459-057652-00D
42-459-057652-00E
42-459-057652-00F
42-459-057652-00G
42-459-057652-00H
42-459-057652-00I
42-459-057652-00J
42-459-057652-00K
42-459-057653-000
42-459-057654-00A
42-459-057655-00A
</TABLE>
Page 150 of 165
<PAGE> 177
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057662-00A Ruth McAdams Ralston Amoco Production Co. 5/14/96 224 831
(Cotton Valley Sand)
Rubey Estate Gas Unit (d) 42-459-057663-00A Richard L. Parker et ux Amoco Production Co. 5/14/96 227 242
416000200
(continued) 42-459-057666-00A William Fred Denton Amoco Production Co. 7/16/96 231 881
42-459-057668-00A Curtis Webb et ux Amoco Production Co. 2/21/96 229 525
42-459-057669-00A Henry P. Bishop et ux Amoco Production Co. 11/10/94 177 54
42-459-057670-00A George S. Heyer, Jr. Amoco Production Co. 4/10/96 226 737
42-459-057670-00B Henri L. Tallichet Amoco Production Co. 4/10/96 222 912
42-459-057670-00C George S. Tallichet Amoco Production Co. 4/10/96 224 842
42-459-057670-00D Robert L. Bradley et al Amoco Production Co. 3/25/96 222 892
42-459-057671-00A Marjorie Musselman Amoco Production Co. 12/8/94 186 827
42-459-057671-00B Diane Meadow Amoco Production Co. 12/15/94 186 830
42-459-057671-00C Margaret Musslewhite Amoco Production Co. 12/8/94 183 231
42-459-057671-00D Elnora Williams Amoco Production Co. 12/13/94 189 413
42-459-057671-00E John Fanning Amoco Production Co. 12/15/94 186 800
42-459-057671-00F Norris Lynn Fanning Amoco Production Co. 12/15/94 186 802
42-459-057671-00G Thelma Buie Amoco Production Co. 2/14/95 186 775
42-459-057671-00H Austin Avenue United Amoco Production Co. 3/16/95 188 968
Methodist Church
42-459-057671-00I Nelda Massey Amoco Production Co. 3/16/95 188 981
42-459-057671-00J Myrtle Threlkeld Amoco Production Co. 3/16/95 108 1008
42-459-057671-00K Eleanor Walker Amoco Production Co. 3/16/95 188 31
42-459-057671-00L Laura Lennard Amoco Production Co. 3/16/95 187 984
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057662-00A A tract or tracts of land located
(Cotton Valley Sand) in Upshur County, Texas, as more
Rubey Estate Gas Unit (d) 42-459-057663-00A fully described in that certain
416000200 Assignment dated effective March
(continued) 42-459-057666-00A 1, 1997, from Amoco Production
Company to Atlantic Richfield
42-459-057668-00A Company, et al, recorded at
Volume 296, Page 245, Official
42-459-057669-00A Records of Upshur County, Texas.
42-459-057670-00A LIMITED IN DEPTH FROM THE SURFACE
DOWN TO 100' BELOW THE DEPTH
42-459-057670-00B DRILLED IN THE C W RESOURCES
RUBEY ESTATE GAS UNIT NO. 1 WELL.
42-459-057670-00C
42-459-057670-00D
42-459-057671-00A
42-459-057671-00B
42-459-057671-00C
42-459-057671-00D
42-459-057671-00E
42-459-057671-00F
42-459-057671-00G
42-459-057671-00H
42-459-057671-00I
42-459-057671-00J
42-459-057671-00K
42-459-057671-00L
</TABLE>
Page 151 of 165
<PAGE> 178
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057671-00M Alice Biett Amoco Production Co. 3/16/95 191 310
(Cotton Valley Sand)
Rubey Estate Gas Unit (d) 42-459-057671-00N Maxine Dwyer Amoco Production Co. 3/16/95 188 975
416000200
(continued) 42-459-057671-00O Gladys Messer Amoco Production Co. 12/6/94 178 968
42-459-057671-00P James Fanning Amoco Production Co. 12/15/94 180 136
42-459-057671-00Q Fay Fanning, a widow Amoco Production Co. 12/9/94 180 139
42-459-057671-00R Rosemary Trevino Amoco Production Co. 12/?/94 183 343
42-459-057672-00A M. Isabel Burke Amoco Production Co. 5/11/95 194 873
42-459-057672-00B Earl B. Johnson et ux Amoco Production Co. 5/11/95 195 20
42-459-057672-00C Leo M. Davis, et al Amoco Production Co. 5/17/95 220 150
42-459-057672-00D Floy Butler et al Amoco Production Co. 5/19/95 197 650
42-459-057672-00E Mary Ryon Talley Amoco Production Co. 5/24/96 226 762
42-459-057672-00F Mimi O. Davis Amoco Production Co. 5/28/96 226 733
42-459-057672-00G Angus G. Wynne, III Amoco Production Co. 5/22/96 226 764
42-459-057672-00H Dorothy O. Range Amoco Production Co. 5/24/96 227 252
42-459-057672-00I Martha T. Gracey Amoco Production Co. 6/3/96 228 457
42-459-057672-00J Patricia J. Singer Amoco Production Co. 5/30/96 229 515
42-459-057672-00K A. R. Davis, Jr. Amoco Production Co. 5/28/96 226 735
42-459-057672-00L Martha Jane Holford Amoco Production Co. 6/10/96 228 459
42-459-057672-00M Herschel G. Brown Amoco Production Co. 5/28/96 226 729
42-459-057672-00N Clifton H. Tucker Amoco Production Co. 6/3/96 229 523
42-459-057672-00O Madeline T. Nolan Amoco Production Co. 6/3/96 230 609
42-459-057672-00P Bedford S. Wynne, Jr. Amoco Production Co. 6/4/96 227 250
42-459-057672-00Q Jerry Lynn Butler Amoco Production Co. 5/28/96 230 607
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057671-00M A tract or tracts of land located
(Cotton Valley Sand) in Upshur County, Texas, as more
Rubey Estate Gas Unit (d) 42-459-057671-00N fully described in that certain
416000200 Assignment dated effective March
(continued) 42-459-057671-00O 1, 1997, from Amoco Production
Company to Atlantic Richfield
42-459-057671-00P Company, et al, recorded at
Volume 296, Page 245, Official
42-459-057671-00Q Records of Upshur County, Texas.
42-459-057671-00R LIMITED IN DEPTH FROM THE SURFACE
DOWN TO 100' BELOW THE DEPTH
42-459-057672-00A DRILLED IN THE C W RESOURCES
RUBEY ESTATE GAS UNIT NO. 1 WELL.
42-459-057672-00B
42-459-057672-00C
42-459-057672-00D
42-459-057672-00E
42-459-057672-00F
42-459-057672-00G
42-459-057672-00H
42-459-057672-00I
42-459-057672-00J
42-459-057672-00K
42-459-057672-00L
42-459-057672-00M
42-459-057672-00N
42-459-057672-00O
42-459-057672-00P
42-459-057672-00Q
</TABLE>
Page 152 of 165
<PAGE> 179
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057672-00R Greta Jackson Newman Amoco Production Co. 5/28/96 227 244
(Cotton Valley Sand)
Rubey Estate Gas Unit (d) 42-459-057672-00S William F. Holmes Amoco Production Co. 6/10/96 230 605
416000200
(continued) 42-459-057672-00T J. Elmer Newman Amoco Production Co. 5/28/96 231 879
42-459-057672-00U David E. Wynne Amoco Production Co. 5/22/96 235 446
42-459-057672-00V M. Temple Wynne Amoco Production Co. 5/22/96 240 642
42-459-057672-00W Anne S. Wynne Amoco Production Co. 6/5/96 240 640
42-459-057672-00X Roger A. Poore Amoco Production Co. 7/5/96 240 620
42-459-057672-00Y Gena Piccolo Amoco Production Co. 7/5/96 240 636
42-459-057673-00A Glenwood Water Supply Amoco Production Co. 3/5/96 218 533
42-459-057674-00A David A. Whitfield Amoco Production Co. 2/16/96 217 199
42-459-057675-00A Brenda Allen Amoco Production Co. 2/16/96 217 166
42-459-057676-00A Bonnie Jean Blalack Amoco Production Co. 2/21/96 217 170
42-459-057677-00A Donald Ross Chambers Amoco Production Co. 5/10/96 224 845
42-459-057678-00A Garry Lenn Thomas Amoco Production Co. 2/2/96 216 141
42-459-057679-00A Ruth Ell Blalack Amoco Production Co. 2/15/96 216 113
42-459-057680-00A Payne Bogardus Amoco Production Co. 2/15/96 216 115
42-459-057681-00A Betty Jean Allen Amoco Production Co. 2/12/96 216 106
42-459-057682-00A William L. Smith et al Amoco Production Co. 2/19/96 217 192
42-459-057683-00A F. D. Sams et ux Amoco Production Co. 2/2/96 216 135
42-459-057684-00A F. D. Sams et ux Amoco Production Co. 2/12/96 216 137
42-459-057685-00A Jacky Lee Drake Amoco Production Co. 11/9/94 177 62
42-459-057685-00B Z. A. Webb Amoco Production Co. 11/9/94 177 92
42-459-057685-00C Erma Jean Rambo Amoco Production Co. 11/9/94 177 87
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057672-00R A tract or tracts of land located
(Cotton Valley Sand) in Upshur County, Texas, as more
Rubey Estate Gas Unit (d) 42-459-057672-00S fully described in that certain
416000200 Assignment dated effective March
(continued) 42-459-057672-00T 1, 1997, from Amoco Production
Company to Atlantic Richfield
42-459-057672-00U Company, et al, recorded at
Volume 296, Page 245, Official
42-459-057672-00V Records of Upshur County, Texas.
42-459-057672-00W LIMITED IN DEPTH FROM THE SURFACE
DOWN TO 100' BELOW THE DEPTH
42-459-057672-00X DRILLED IN THE C W RESOURCES
RUBEY ESTATE GAS UNIT NO. 1 WELL.
42-459-057672-00Y
42-459-057673-00A
42-459-057674-00A
42-459-057675-00A
42-459-057676-00A
42-459-057677-00A
42-459-057678-00A
42-459-057679-00A
42-459-057680-00A
42-459-057681-00A
42-459-057682-00A
42-459-057683-00A
42-459-057684-00A
42-459-057685-00A
42-459-057685-00B
42-459-057685-00C
</TABLE>
Page 153 of 165
<PAGE> 180
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057686-00A Odie Banks et al Amoco Production Co. 10/4/94 180 128
(Cotton Valley Sand)
Rubey Estate Gas Unit (d) 42-459-057720-000 Max Salter et al Amoco Production Co. 5/13/95 195 40
416000200
(continued) 42-459-057721-000 Max Salter Amoco Production Co. 5/13/95 195 38
42-459-057732-000 Henry P. Bishop et ux Amoco Production Co. 12/6/96 245 333
42-459-057735-000 Jeffrey D. Davis Amoco Production Co. 2/13/96 216 117
42-459-057736-000 Greg Nuckolls et ux Amoco Production Co. 2/7/96 216 132
42-459-057737-000 Palmer J. Sellers Amoco Production Co. 2/2/96 216 139
42-459-057738-000 Zikie Lee Graham et ux Amoco Production Co. 2/6/96 215 48
42-459-057744-000 Maxine Childress Amoco Production Co. 11/30/94 178 951
42-459-057757-00A Marian Lyeth Davis Amoco Production Co. 3/13/95 189 352
42-459-057803-000 J. R. McCormick et ux Amoco Production Co. 2/7/97 250 687
42-459-057804-000 Sylvio R. Cote et ux Amoco Production Co. 2/10/97 250 675
42-459-057805-000 Arnold Grimes et ux Amoco Production Co. 2/10/97 250 683
42-459-057806-00A Mary Kathryn McKinley Amoco Production Co. 6/17/97 265 966
Drake
42-459-057806-00B Leo McKinley et al Amoco Production Co. 5/28/97 265 968
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057686-00A A tract or tracts of land located
(Cotton Valley Sand) in Upshur County, Texas, as more
Rubey Estate Gas Unit (d) 42-459-057720-000 fully described in that certain
416000200 Assignment dated effective March
(continued) 42-459-057721-000 1, 1997, from Amoco Production
Company to Atlantic Richfield
42-459-057732-000 Company, et al, recorded at
Volume 296, Page 245, Official
42-459-057735-000 Records of Upshur County, Texas.
42-459-057736-000 LIMITED IN DEPTH FROM THE SURFACE
DOWN TO 100' BELOW THE DEPTH
42-459-057737-000 DRILLED IN THE C W RESOURCES
RUBEY ESTATE GAS UNIT NO. 1 WELL.
42-459-057738-000
42-459-057744-000
42-459-057757-00A
42-459-057803-000
42-459-057804-000
42-459-057805-000
42-459-057806-00A
42-459-057806-00B
</TABLE>
Page 154 of 165
<PAGE> 181
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057626-00A Norma Maclin Ray R. Lacy, Inc. 3-6-95 196 239
(Cotton Valley Sand)
Watts Heirs Gas Unit (d) 42-459-057626-00B B.J. Barclay et al R. Lacy, Inc. 3-6-95 186 989
411578300
33.33% WI 42-459-057626-00C Myra Lynn Ray Roberts R. Lacy, Inc. 3-6-95 186 994
42-459-057627-00A Shirley L. Day et vir R. Lacy, Inc. 9-15-94 172 558
42-459-057631-00A T. L. Johnson, Jr. Crown Resources Co. 5-6-96 229 161
42-459-057631-00B Pacific Enterprises ABC Amoco Production Co. 4-11-96 222 732
Corporation
42-459-057631-00C Tillman T. Johnson R. Lacy, Inc. 8-26-94 169 500
42-459-057633-00A Mary Nell Floyd Amoco Production Co. 5-29-96 225 911
42-459-057634-00A Wesley E. Frisbie R. Lacy, Inc. 7-13-94 174 157
42-459-057634-00B Marguerite Molder R. Lacy, Inc. 7-13-94 168 244
42-459-057634-00C David S. Humphrey R. Lacy, Inc. 7-1-94 171 381
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057626-00A A tract or tracts of land located AR-105496
(Cotton Valley Sand) in Upshur County and Gregg Farmin Agreement dated December 12, 1996
Watts Heirs Gas Unit (d) 42-459-057626-00B County, Texas, as more fully Between Amoco Production Company, Farmor,
411578300 described in that certain And C W Resources, Inc., et al, Farmee
33.33% WI 42-459-057626-00C Assignment dated effective June
22, 1997, from Amoco Production AR-105498
42-459-057627-00A Company to Atlantic Richfield Joint Operating Agreement dated December 12,
Company, et al, recorded at 1996 between C W Resources, Inc., Operator,
42-459-057631-00A Volume 281, Page 996, Official And Atlantic Richfield Company, et al,
Records of Upshur County, Texas. non-operators
42-459-057631-00B
LIMITED IN DEPTH FROM THE SURFACE AR-105498-001
42-459-057631-00C DOWN TO 100' BELOW THE TOTAL Designation of Gas Unit dated March 13, 1997,
DEPTH DRILLED IN THE C W by and between C W Resources, Inc. and
42-459-057633-00A RESOURCES WATTS HEIRS GAS UNIT Atlantic Richfield Company, et al
NO. 1 WELL.
42-459-057634-00A AR-105526
Interruptible Gas Transportation Agreement
42-459-057634-00B dated March 1, 1997, between C W Resources,
Atlantic Richfield Company, et al, "Sellers"
42-459-057634-00C and Delhi Gas Pipeline Corporation,
"Transporter".
</TABLE>
Page 155 of 165
<PAGE> 182
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057634-00D Barbara Cain R. Lacy, Inc. 7-13-94 165 584
(Cotton Valley Sand)
Watts Heirs Gas Unit (d) 42-459-057634-00E Terry R. Brown R. Lacy, Inc. 6-17-94 168 121
411578300
(continued) 42-459-057634-00F James G. Humphrey R. Lacy, Inc. 7-1-94 169 503
42-459-057634-00G Kay Barney R. Lacy, Inc. 7-1-94 168 119
42-459-057634-00H Dorothy Nell Love Goins R. Lacy, Inc. 6-30-94 164 927
42-459-057635-00A Doris B. Price R. Lacy, Inc. 1-20-95 183 12
42-459-057635-00B Penny Price Seiders R. Lacy, Inc. 1-20-95 186 49
42-459-057635-00C Rena Marie Roberts R. Lacy, Inc. 7-1-94 164 980
42-459-057635-00D Claude H. Roberts, Jr. R. Lacy, Inc. 7-1-94 164 948
42-459-057635-00E Walter Roach Crown Resources Co. 4-3-97 264 510
42-459-057637-00A Fannie Reeves Kahn Tr. Amoco Production Co. 6-11-96 229 229
42-459-057637-00B Gloria Taylor Wismar Amoco Production Co. 3-27-96 222 781
42-459-057637-00C Nancy Taylor Kennedy Amoco Production Co. 3-27-96 222 713
42-459-057637-00D Charles S. Taylor Amoco Production Co. 3-27-96 222 757
42-459-057637-00E Mary Lou Ray McCain R. Lacy, Inc. 8-4-94 168 246
42-459-057637-00F J. D. Tillery, et al R. Lacy, Inc. 8-4-94 168 258
42-459-057637-00G Mary Rylie Gibson R. Lacy, Inc. 8-8-94 168 237
42-459-057637-00H B.J. Barclay et al R. Lacy, Inc. 8-3-94 168 116
42-459-057637-00I Julian William Thrasher, R. Lacy, Inc. 8-1-94 168 255
Jr., Trustee
42-459-057637-00J James Ray Northcutt R. Lacy, Inc. 8-4-94 168 249
42-459-057637-00K Leonard Frank Ray Family R. Lacy, Inc. 8-4-94 174 159
Trust
42-459-057637-00L G. Arthur Donnelly, III R. Lacy, Inc. 10-20-94 196 208
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057634-00D A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
Watts Heirs Gas Unit (d) 42-459-057634-00E County, Texas, as more fully
411578300 described in that certain
(continued) 42-459-057634-00F Assignment dated effective June
22, 1997, from Amoco Production
42-459-057634-00G Company to Atlantic Richfield
Company, et al, recorded at
42-459-057634-00H Volume 281, Page 996, Official
Records of Upshur County, Texas.
42-459-057635-00A
LIMITED IN DEPTH FROM THE SURFACE
42-459-057635-00B DOWN TO 100' BELOW THE TOTAL
DEPTH DRILLED IN THE C W
42-459-057635-00C RESOURCES WATTS HEIRS GAS UNIT
NO. 1 WELL.
42-459-057635-00D
42-459-057635-00E
42-459-057637-00A
42-459-057637-00B
42-459-057637-00C
42-459-057637-00D
42-459-057637-00E
42-459-057637-00F
42-459-057637-00G
42-459-057637-00H
42-459-057637-00I
42-459-057637-00J
42-459-057637-00K
42-459-057637-00L
</TABLE>
Page 156 of 165
<PAGE> 183
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057637-00M Nancy Bruce Curlee R. Lacy, Inc. 7-26-94 167 573
(Cotton Valley Sand)
Watts Heirs Gas Unit (d) 42-459-057637-00N Myra Lynn Ray Roberts R. Lacy, Inc. 8-1-94 172 573
411578300
(continued) 42-459-057637-00O Annie Lou Ray Grigsby R. Lacy, Inc. 8-4-94 168 123
42-459-057638-00A Howard W. Parker et ux R. Lacy, Inc. 7-18-94 166 387
42-459-057638-00B Jack M. Newman et al R. Lacy, Inc. 7-13-94 179 409
42-459-057639-00A Lester Shoshone Trust B R. Lacy, Inc. 7-9-94 164 986
42-459-057639-00B Magalene Fleet Mullican Crown Resources Co. 1-4-97 247 173
42-459-057640-00A Iva Marie Cameron Fleck R. Lacy, Inc. 7-13-94 166 372
42-459-057640-00B Joan Anderson R. Lacy, Inc. 7-13-94 165 581
42-459-057640-00C Mabel Gilpin R. Lacy, Inc. 7-13-94 164 972
42-459-057640-00D Sue Vickery R. Lacy, Inc. 7-13-94 165 594
42-459-057640-00E E. L. Riddle, Jr. R. Lacy, Inc. 7-16-94 165 542
42-459-057640-00F Robert Hearn Williams R. Lacy, Inc. 7-13-94 165 596
42-459-057640-00G Charles H. Meyer R. Lacy, Inc. 7-13-94 165 590
42-459-057641-00A Judith M. Wrucke R. Lacy, Inc. 3-17-95 2845 492
42-459-057641-00B Claude Graves, III R. Lacy, Inc. 3-29-95 2845 487
42-459-057641-00C Michael Andrew Stieren R. Lacy, Inc. 8-6-94 171 395
42-459-057641-00D Jennifer L. Stieren R. Lacy, Inc. 8-6-94 171 398
42-459-057641-00E Georgia Ann Stieren R. Lacy, Inc. 8-6-94 171 401
42-459-057641-00F Doris K. Ehrenberg R. Lacy, Inc. 3-17-95 196 212
42-459-057641-00G Gayla S. Graves R. Lacy, Inc. 3-17-95 196 220
42-459-057641-00H Claude Graves, III R. Lacy, Inc. 3-17-95 196 216
42-459-057642-00A Josh R. Morriss, III R. Lacy, Inc. 3-17-95 196 376
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057637-00M A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
Watts Heirs Gas Unit (d) 42-459-057637-00N County, Texas, as more fully
411578300 described in that certain
(continued) 42-459-057637-00O Assignment dated effective June
22, 1997, from Amoco Production
42-459-057638-00A Company to Atlantic Richfield
Company, et al, recorded at
42-459-057638-00B Volume 281, Page 996, Official
Records of Upshur County, Texas.
42-459-057639-00A
LIMITED IN DEPTH FROM THE SURFACE
42-459-057639-00B DOWN TO 100' BELOW THE TOTAL
DEPTH DRILLED IN THE C W
42-459-057640-00A RESOURCES WATTS HEIRS GAS UNIT
NO. 1 WELL.
42-459-057640-00B
42-459-057640-00C
42-459-057640-00D
42-459-057640-00E
42-459-057640-00F
42-459-057640-00G
42-459-057641-00A
42-459-057641-00B
42-459-057641-00C
42-459-057641-00D
42-459-057641-00E
42-459-057641-00F
42-459-057641-00G
42-459-057641-00H
42-459-057642-00A
</TABLE>
Page 157 of 165
<PAGE> 184
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057642-00B Lee M. Daniels R. Lacy, Inc. 7-16-94 167 579
(Cotton Valley Sand)
Watts Heirs Gas Unit (d) 42-459-057642-00C Don N. Morriss R. Lacy, Inc. 7-13-94 166 382
411578300
(continued) 42-459-057642-00D Martha Leah Morriss R. Lacy, Inc. 7-13-94 166 380
42-459-057642-00E Carol Elizabeth Dodds R. Lacy, Inc. 7-19-94 172 560
42-459-057642-00F William A. Ferguson R. Lacy, Inc. 7-19-94 164 970
42-459-057642-00G Melisa Daniels Butler R. Lacy, Inc. 7-16-94 167 577
42-459-057642-00H William O. Morriss R. Lacy, Inc. 7-13-94 166 378
42-459-057642-00I Joan Baldridge Bratton R. Lacy, Inc. 7-13-94 166 370
42-459-057642-00J Deborah Elyse Redfern R. Lacy, Inc. 7-19-94 167 581
42-459-057642-00K Jeana T. McClintock R. Lacy, Inc. 7-19-94 180 442
42-459-057643-00A Susan Graves R. Lacy, Inc. 8-4-94 168 126
42-459-057643-00B Linda R. Rodgers R. Lacy, Inc. 8-4-94 168 146
42-459-057643-00C M. G. Ray R. Lacy, Inc. 8-4-94 168 145
42-459-057645-00A Willie Lee Starr et ux R. Lacy, Inc. 6-15-94 163 417
42-459-057645-00B Johnnie Faye Bowden R. Lacy, Inc. 6-15-94 163 401
42-459-057645-00C Stephanie More R. Lacy, Inc. 6-17-94 163 413
42-459-057647-00A The Nabors Trust R. Lacy, Inc. 7-1-94 164 934
42-459-057648-00A Andrews Royalty, Inc. Crown Resources Co. 3-5-97 255 821
42-459-057708-000 Mrs. E. A. Watts Elbert Williams 10-8-50 5 260
42-459-057709-00A Lee Tanner Fleet Crown Resources Co. 6-25-97 267 982
42-459-057709-00B Gerald Hunter Fleet Crown Resources Co. 6-25-97 267 984
42-459-057709-00C Betty Jean Sheffield Crown Resources Co. 6-25-97 267 988
42-459-057709-00D Charles Buck Fleet Crown Resources Co. 6-25-97 267 980
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057642-00B A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
Watts Heirs Gas Unit (d) 42-459-057642-00C County, Texas, as more fully
411578300 described in that certain
(continued) 42-459-057642-00D Assignment dated effective June
22, 1997, from Amoco Production
42-459-057642-00E Company to Atlantic Richfield
Company, et al, recorded at
42-459-057642-00F Volume 281, Page 996, Official
Records of Upshur County, Texas.
42-459-057642-00G
LIMITED IN DEPTH FROM THE SURFACE
42-459-057642-00H DOWN TO 100' BELOW THE TOTAL
DEPTH DRILLED IN THE C W
42-459-057642-00I RESOURCES WATTS HEIRS GAS UNIT
NO. 1 WELL.
42-459-057642-00J
42-459-057642-00K
42-459-057643-00A
42-459-057643-00B
42-459-057643-00C
42-459-057645-00A
42-459-057645-00B
42-459-057645-00C
42-459-057647-00A
42-459-057648-00A
42-459-057708-000
42-459-057709-00A
42-459-057709-00B
42-459-057709-00C
42-459-057709-00D
</TABLE>
Page 158 of 165
<PAGE> 185
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- ------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Glenwood Field 42-459-057710-00A Joe Miller et ux Wanda Crown Resources Co. 4-3-97 255 830
(Cotton Valley Sand)
Watts Heirs Gas Unit(d) 42-459-057717-00A Phillip A. Works et ux R. Byron Roach, Ttee 6-29-94 169 293
411578300
(continued) 42-459-057718-00A Mary Virginia Smith J. Don Westbrook 7-15-94 175 101
42-459-057718-00B Mary Nell Smith Floyd J. Don Westbrook 7-14-94 175 56
42-459-057718-00C June Robison J. Don Westbrook 7-15-94 175 97
42-459-057718-00D Fayrene Lee J. Don Westbrook 7-15-94 175 91
42-459-057718-00E Clarine Smith Tucker J. Don Westbrook 7-14-94 175 105
42-459-057718-00F Fayrine Smith Green J. Don Westbrook 7-14-94 175 75
42-459-057719-00A Matt S. McKenzie R. Byron Roach, Ttee 10-2-94 185 946
Unknown Betty R. LeBaron Crown Resources Co. 2-18-97 253 942
Unknown Anne Price MacKenzie R. Byron Roach, Ttee 1-20-95 169 293
Unknown Pursuit Energy Corp. Crown Resources Co. 5-2-97 261
- --------------------------- ----------------- -------------------------- --------------------- ------- ---- ----
East Texas Field Unknown Unknown Unknown
A. L. Jenkins
415553000
D.O. 42-459-031186-000
Operator
Roberts & Murphy, Inc.
Revenue Interest 0.997812
- --------------------------- ----------------- -------------------------- --------------------- ------- ---- ----
East Texas Field 42-183-057222-00A Anna Kathryn Rulfs Holbrook Team Invest, Inc. 1/24/96 224 182
J. H. Sabey Gas Unit
417896300
- -0- WI (Before 400%
Payout)
- -0- NRI
- --------------------------- ----------------- -------------------------- --------------------- ------- ---- ----
42-183-057222-00B Sharon Rulfs Kerr Team Invest, Inc. 1/24/96 224 230
- --------------------------- ----------------- -------------------------- --------------------- ------- ---- ----
42-183-057222-00C L. D. Rulfs, Jr. Team Invest, Inc. 1/24/96 224 303
- --------------------------- ----------------- -------------------------- --------------------- ------- ---- ----
42-183-057222-00d Henry E. Pybus Wagner & Brown, Ltd. 10/18/96 259 195
- --------------------------- ----------------- -------------------------- --------------------- ------- ---- ----
42-183-057223-00A Thomas C. Merritt, Trustee Team Invest, Inc. 5/16/96 224 243
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Glenwood Field 42-459-057710-00A A tract or tracts of land located
(Cotton Valley Sand) in Upshur County and Gregg
Watts Heirs Gas Unit(d) 42-459-057717-00A County, Texas, as more fully
411578300 described in that certain
(continued) 42-459-057718-00A Assignment dated effective June
22, 1997, from Amoco Production
42-459-057718-00B Company to Atlantic Richfield
Company, et al, recorded at
42-459-057718-00C Volume 281, Page 996, Official
Records of Upshur County, Texas.
42-459-057718-00D
LIMITED IN DEPTH FROM THE SURFACE
42-459-057718-00E DOWN TO 100' BELOW THE TOTAL
DEPTH DRILLED IN THE C W
42-459-057718-00F RESOURCES WATTS HEIRS GAS UNIT
NO. 1 WELL.
42-459-057719-00A
Unknown
Unknown
Unknown
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
East Texas Field Unknown 37.5 acres, more or less, out of
A. L. Jenkins the H. H. Edwards Survey, A-668,
415553000 Upshur County, Texas
D.O. 42-459-031186-000
Operator
Roberts & Murphy, Inc.
Revenue Interest 0.997812
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
East Texas Field 42-183-057222-00A 234.50 acres out of Leino Subject to 400% Non-Consent JOA Ar-105492 J.
J. H. Sabey Gas Unit Gonzales A-169 (Tract 1 Deed H. Sabey GU. Subject to 4/24/96 Letter
417896300 263/229 DR), Upshur County, Texas Agreement between Team Invest, Inc. and
- -0- WI (Before 400% Wagner & Brown, Ltd.
Payout)
- -0- NRI
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
42-183-057222-00B 234.50 acres out of Leino Subject to 400% Non-Consent JOA Ar-105492 J.
Gonzales A-169 (Tract 1 Deed H. Sabey GU. Subject to 4/24/96 Letter
263/229 DR), Upshur County, Texas Agreement between Team Invest, Inc. and
Wagner & Brown, Ltd.
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
42-183-057222-00C 234.50 acres out of Leino Subject to 400% Non-Consent JOA Ar-105492 J.
Gonzales A-169 (Tract 1 Deed H. Sabey GU. Subject to 4/24/96 Letter
263/229 DR), Upshur County, Texas Agreement between Team Invest, Inc. and
Wagner & Brown, Ltd.
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
42-183-057222-00d 234.50 acres out of Leino Subject to 400% Non-Consent JOA Ar-105492 J.
Gonzales A-169 (Tract 1 Deed H. Sabey GU. Subject to 4/24/96 Letter
263/229 DR), Upshur County, Texas Agreement between Team Invest, Inc. and
Wagner & Brown, Ltd.
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
42-183-057223-00A 234.50 acres out of Leino Subject to 400% Non-Consent JOA Ar-105492 J.
Gonzales A-169 (Tract 1 Deed H. Sabey GU. Subject to 4/24/96 Letter
263/229 DR), Upshur County, Texas Agreement between Team Invest, Inc. and
Wagner & Brown, Ltd.
</TABLE>
Page 159 of 165
<PAGE> 186
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Gladewater Field 42-459-057205-00A Lawauna Hill, Guardian of Team Invest, Inc. 7/17/96 233 31
(Cotton Valley) Estate of Marcelle Daffan
Faye Pittman Willeford McLeroy
400050100
33.33% WI BPO
25.975504% NRI BPO
42-459-057206-00A James Reagan Somerset Wyche Team Invest, Inc. 9/3/96 237 209
42-459-057206-00B Elizabeth Ellen Wyche Team Invest, Inc. 9/3/96 237 207
Robison
42-459-057206-00C Annie Marie Boyd Johnson Team Invest, Inc. 9/20/96 240 815
42-459-057206-00D Estelline Boyd Team Invest, Inc. 9/20/96 240 809
42-459-057206-00E James V. Burnett Team Invest, Inc. 9/20/96 240 811
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Gladewater Field 42-459-057205-00A 221.90 acres out of Leino AR-105492
(Cotton Valley) Gonzales A-169, being 100.0 and Joint Operating Agreement between C W
Faye Pittman Willeford 15.3 acres (First and Second Resources, et al Subject to 4/24/96 Letter
400050100 Tracts OGML 128/324 OGR), 84.9 Agreement between Team Invest, Inc. and
33.33% WI BPO acres (OGML 175/608 OGR), and Wagner & Brown, Ltd.
25.975504% NRI BPO 21.7 acres (OGML 128/321 OGR)
Upshur County, Texas, being Tract
7&8 of the Faye Willeford Gas Unit
42-459-057206-00A 264.90 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 73.6 (Deed
172/240 DR) and 110.3 acres (MC
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2, 3 & 4 of the Faye
Willeford Gas Unit.
42-459-057206-00B 264.90 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 73.6 (Deed
172/240 DR) and 110.3 acres (MC
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2, 3 & 4 of the Faye
Willeford Gas Unit.
42-459-057206-00C 264.90 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 73.6 (Deed
172/240 DR) and 110.3 acres (MC
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2, 3 & 4 of the Faye
Willeford Gas Unit.
42-459-057206-00D 264.90 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 73.6 (Deed
172/240 DR) and 110.3 acres (MC
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2, 3 & 4 of the Faye
Willeford Gas Unit.
42-459-057206-00E 264.90 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 73.6 (Deed
172/240 DR) and 110.3 acres (MC
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2, 3 & 4 of the Faye
Willeford Gas Unit.
</TABLE>
Page 160 of 165
<PAGE> 187
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Gladewater Field 42-459-057207-00A Rose Marie Hurmence Team Invest, Inc. 9/20/96 240 963
(Cotton Valley)
Faye Pittman Willeford
400050100
33.33% WI BPO
25.975504% NRI BPO
42-459-057207-00B Ann Boyd Monk Team Invest, Inc. 9/20/96 240 965
42-459-057207-00C Shirley Muenzler Team Invest, Inc. 9/20/96 240 817
42-457-057207-00D Peggy Pieper, et vir Ben Team Invest, Inc. 9/20/96 240 819
42-457-057207-00E Linda Cantrell Team Invest, Inc. 9/20/96 240 813
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Gladewater Field 42-459-057207-00A 201.3 acres, being 91.0 acres AR-105492
(Cotton Valley) (Deed 173/280 DR) out of Wm. Joint Operating Agreement between C W
Faye Pittman Willeford Carlton A-72 and 110.3 acres (MD Resources, et al Subject to 4/24/96 Letter
400050100 233/189 DR) out of Wm. Carlton Agreement between Team Invest, Inc. and
33.33% WI BPO A-72 and Leino Gonzales A-169, Wagner & Brown, Ltd
25.975504% NRI BPO Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-459-057207-00B 201.3 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 110.3 acres (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-459-057207-00C 201.3 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 110.3 acres (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-457-057207-00D 201.3 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 110.3 acres (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-457-057207-00E 201.3 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 110.3 acres (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
</TABLE>
Page 161 of 165
<PAGE> 188
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Gladewater Field 42-457-057207-00F Irene Arnold, et vir A. A. Team Invest, Inc. 9/20/96 240 959
(Cotton Valley)
Faye Pittman Willeford
400050100
33.33% WI BPO
25.975504% NRI BPO
42-457-057207-00G Reba Boyd, AIF for Milton Team Invest, Inc. 9/20/96 239 657
Boyd
42-457-057207-00H Barbara Barger Team Invest, Inc. 9/2096 247 120
42-457-057207-00I Mattie F. Boyd Team Invest, Inc. 9/20/96 247 122
42-457-057208-00A Faye Pittman Wileford Team Invest, Inc. 5/1/96 225 200
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Gladewater Field 42-457-057207-00F 201.3 acres, being 91.0 acres AR-105492
(Cotton Valley) (Deed 173/280 DR) out of Wm. Joint Operating Agreement between C W
Faye Pittman Willeford Carlton A-72 and 110.3 acres (MD Resources, et al Subject to 4/24/96 Letter
400050100 233/189 DR) out of Wm. Carlton Agreement between Team Invest, Inc. and
33.33% WI BPO A-72 and Leino Gonzales A-169, Wagner & Brown, Ltd
25.975504% NRI BPO Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-457-057207-00G 201.3 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 110.3 acres (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-457-057207-00H 201.3 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 110.3 acres (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-457-057207-00I 201.3 acres, being 91.0 acres
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 110.3 acres (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2 & 4 of the Faye
Willeford Gas Unit
42-457-057208-00A 85.3 acres, being 42.3 acres
(Deed 244/207 DR) out of Leino
Gonzales A-169 and W. L. Palmer
A-392, and 40.0 acres (60.0 acres
Deed 265/514 DR LESS 20.0 acres
Unit 168/530 OGR) and 3.0 acres
(Deed 265/514 DR) out of Leino
Gonzales A-169, Upshur County,
Texas, being Tract 9 of the Faye
Willeford Gas Unit
</TABLE>
Page 162 of 165
<PAGE> 189
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Gladewater Field 42-459-057370-00A Texas Baptist Children's Oxy USA, Inc. 4/17/96 226 444
(Cotton Valley) Home, Round Rock,
Faye Pittman Willeford a Texas Corporation
400050100
33.33% WI BPO
25.975504% NRI BPO
42-459-057370-00B The First Baptist Church Oxy USA, Inc. 3/29/96 226 433
of Gladewater, a
Texas Corporation
42-459-057370-00C East Texas Baptist Oxy USA, Inc. 5/20/96 234 745
University, a Texas
Corporation
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Gladewater Field 42-459-057370-00A 206.60 acres out of Wm. Carlton AR-105492
(Cotton Valley) A-72, being lease tracts 2 Joint Operating Agreement between C W
Faye Pittman Willeford (52.0), 3 (91.0) and 4 (63.60) Resources et al
400050100 (Deeds 149.468, 173/280 and
33.33% WI BPO 172/240 respectively), from AR-105495
25.975504% NRI BPO Surface to 100' below Farmout from Oxy USA
Stratigraphic Equivalent of
T.D.D. 11,200' as logged in
Willeford No. 1, Upshur County,
Texas, being Tracts 1, 2 & 3 of
the Faye Willeford Gas Unit
42-459-057370-00B 206.60 acres out of Wm. Carlton
A-72, being lease tracts 2
(52.0), 3 (91.0) and 4 (63.60)
(Deeds 149.468, 173/280 and
172/240 respectively), from
Surface to 100' below
Stratigraphic Equivalent of
T.D.D. 11,200' as logged in
Willeford No. 1, Upshur County,
Texas, being Tracts 1, 2 & 3 of
the Faye Willeford Gas Unit
42-459-057370-00C 206.60 acres out of Wm. Carlton
A-72, being lease tracts 2
(52.0), 3 (91.0) and 4 (63.60)
(Deeds 149.468, 173/280 and
172/240 respectively), from
Surface to 100' below
Stratigraphic Equivalent of
T.D.D. 11,200' as logged in
Willeford No. 1, Upshur County,
Texas, being Tracts 1, 2 & 3 of
the Faye Willeford Gas Unit
</TABLE>
Page 163 of 165
<PAGE> 190
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Gladewater Field 42-459-057371-00A Gloria Nan Serpas, dihsp Oxy USA, Inc. 4/25/96 231 102
(Cotton Valley)
Faye Pittman Willeford
400050100
33.33% WI BPO
25.975504% NRI BPO
42-459-057371-00B Patsy Jean Taylor, dihsp Oxy USA, Inc. 4/25/96 2312 99
42-459-057372-00A Ken McGinnis, individually Oxy USA, Inc. 4/23/96 226 439
and as sole owner of
McGinnis Carpet Center
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
42-459-057370-00D Clara Faye Smith, a widow Crown Resources 5/10/95 195 34
Company
42-459-057373-00A William B. Cook, dihsp Crown Resources 7/1/95 197 657
Thomas N. Cook, dihsp Company
Robert B. Cook, Jr., dihsp
42-459-057374-00A Kathryn Cook Porter, mwdihsp Crown Resources 7/1/95 197 711
Company
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
Gladewater Field 42-459-057371-00A 110.30 acres out of Wm. Carlton AR-105492
(Cotton Valley) A-72 and L. Gonzales A-169 (MD Joint Operating Agreement between C W
Faye Pittman Willeford 233/189 DR), from Surface to 100' Resources et al
400050100 below Stratigraphic Equivalent of
33.33% WI BPO T.D.D. 11,200' as logged in AR-105495
25.975504% NRI BPO Willeford No. 1, Upshur County, Farmout from Oxy USA
Texas, being Tract 4 of the Faye
Willeford Gas Unit
42-459-057371-00B 110.30 acres out of Wm. Carlton
A-72 and L. Gonzales A-169 (MD
233/189 DR), from Surface to 100'
below Stratigraphic Equivalent of
T.D.D. 11,200' as logged in
Willeford No. 1, Upshur County,
Texas, being Tract 4 of the Faye
Willeford Gas Unit
69.17 acres our of L. Gonzales
42-459-057372-00A A-169 (Deed 361/890 DR), from
Surface to 100' below
Stratigraphic Equivalent of
T.D.D. 11,200' as logged in
Willeford No. 1, Upshur County,
Texas, being Tracts 7&8 of the
Faye Willeford Gas Unit
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
42-459-057370-00D 206.60 acres out of Wm. Carlton AR-105492
A-72, being lease tracts 1 Joint Operating Agreement between C W
(52.0), 2 (63.60) and 3 (91.0) Resources et al
(Deeds 149/468, 172/240 and
173/280 respectively, from AR-105493
Surface to 11,300' (100' below Farmout from Amoco Production Company
T.D. in Willeford No. 1), Upshur
County, Texas, being Traacts 1, 2
& 3 of the Faye Willeford Gas Unit
42-459-057373-00A 222.0 acres, being tracts of 80.0
and 48.0 acres out of Wm. Carlton
A-72 (Tr. 1, 2 Deed 362/548), and
94.0 acres out of Robert Burton
A-41 (Deed 392/889 DR) from
Surface to 11,300' (100' below
T.D. in Willeford No. 1), Upshur
County, Texas, being Tracts 5, 6
& 10 of the Faye Willeford Gas
Unit
42-459-057374-00A 94.0 acres, being 94.0 acres out
of Robert Burton A-41 (Deed
392/889 DR) from Surface to
11,300' (100' below T.D. in
Willeford No. 1), Upshur County,
Texas, being Tract 5 of the Faye
Willeford Gas Unit
</TABLE>
Page 164 of 165
<PAGE> 191
<TABLE>
<CAPTION>
FIELD NAME
PROPERTY NAME DEED
PROPERTY CODE LEASE
ARCO'S INTEREST ARCO LEASE NO. LESSOR/GRANTOR LESSEE/GRANTEE DATE BOOK PAGE
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
<S> <C> <C> <C> <C> <C> <C>
42-459-057375-000 Geneva Stevens, a widow A. E. Waghalter 4/5/72 129 509
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
42-459-057786-00A Barbara Simpson Cooper Wagner & Brown, Ltd. 9/4/96 262 605
42-459-057787-00A W. P. Hamilton Wagner & Brown, Ltd. 3/10/97 262 601
42-459-057787-00B The Elbert Dennis Bowles, Wagner & Brown, Ltd. 3/12/97 262 603
Jr. Family Trust
42-459-057787-00C Harold W. Smith
Wagner & Brown, Ltd. 8/25/97
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
42-459-057786-00B Mary Margaret Carloss Team Invest, Inc. 8/18/97 275 71
42-459-057206-00F Rose Mings Knight Team Invest, Inc. 8/25/97 275 83
- --------------------------- ----------------- -------------------------- --------------------- --------- ---- ----
East Texas Field
A. L. Jenkins (Small RI)
41555300
.7812% NRI
<CAPTION>
FIELD NAME
PROPERTY NAME
PROPERTY CODE
ARCO'S INTEREST ARCO LEASE NO. DESCRIPTION OF LANDS SUBJECT TO:
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
<S> <C> <C> <C>
42-459-057375-000 24.10 acres out of 119.90 acre AR-105492
lease Tr. 4, L. Gonzales A-169 Joint Operating Agreement between C W
(Deed 233/404 DR) from Surface to Resources et al
11,300' (100' below T.D. in
Willeford No. 1), Upshur County, AR-105494
Texas, being Tract 11 of the Faye Farmout from Exxon
Willeford Gas Unit
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
42-459-057786-00A 52.0 acres out of Wm. Carlton AR-105492
A-72 (Deed 149/468 DR), Upshur Joint Operating Agreement between C W
County, Texas, being Tract 1 of Resources et al
the Faye Willeford Gas Unit
42-459-057787-00A 1514.60 acres, being tracts of
91.0 and 63.60 acres out of Wm.
Carlton A-72 (Dees 173/280 and
172/240 DR respectively), Upshur
County, Texas, being Tracts 2 & 3
of the Faye Willeford Gas Unit
42-459-057787-00B 1514.60 acres, being tracts of
91.0 and 63.60 acres out of Wm.
Carlton A-72 (Dees 173/280 and
172/240 DR respectively), Upshur
County, Texas, being Tracts 2 & 3
of the Faye Willeford Gas Unit
42-459-057787-00C 1514.60 acres, being tracts of
91.0 and 63.60 acres out of Wm.
Carlton A-72 (Dees 173/280 and
172/240 DR respectively), Upshur
County, Texas, being Tracts 2 & 3
of the Faye Willeford Gas Unit
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
42-459-057786-00B 52.0 acres out of Wm. Carlton AR-105492
A-72 Deed 149/468 DR), Upshur Joint Operating Agreement between C W
County, Texas, being Tract 1 of Resources et al
the Faye Willeford Gas Unit
4/24/96 Letter Agreement between Team Invest,
42-459-057206-00F 264.90 acres, being 91.0 acres Inc. and Wagner & Brown, Ltd.
(Deed 173/280 DR) out of Wm.
Carlton A-72 and 73.6 (Deed
173/280 DR) and 110.3 aces (MD
233/189 DR) out of Wm. Carlton
A-72 and Leino Gonzales A-169,
Upshur County, Texas, being
Tracts 2, 3 & 4 of the Faye
Willeford Gas Unit
- --------------------------- ------------------ ----------------------------------- ----------------------------------------------
East Texas Field 37.5 acres out of H. H. Edwards
A. L. Jenkins (Small RI) Survey, Upshur County, Texas
41555300
.7812% NRI
</TABLE>
Page 165 of 165
<PAGE> 192
EXHIBIT B
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
EXCLUDED ASSETS
1. Lien Under South Kilgore Unit Operating Agreement as more particularly
described in Affidavit of Lien Under Operating Agreement dated July 16,
1998, recorded in V 2084, P 0188-0206, Rusk County, Texas, INSOFAR AND ONLY
INSOFAR as said lien secures unpaid amounts attributable to the period
prior to the Effective Date.
2. All records, files and maps subject to rights of the East Texas Engineering
Association (ETEA) unless, or until, proof of Purchaser's membership in the
ETEA is provided to ARCO
3. 24.4 acres tract of land in Gregg County, Texas, more commonly referred to
as production office tract located at 1907 East Old Highway 80, White Oak,
TX 75693, subject to the Surface Lease Agreement attached to the Purchase
and Sale Agreement as Exhibit 10.2(l).
4. Stock certificates for and ownership in the East Texas Salt Water Disposal
Company
5. Certain geological and all geophysical data, licenses, rights and
intellectual property held or managed by ARCO in, but not limited to,
Gregg, Upshur, Smith, Rusk and Cherokee Counties, Texas.
<PAGE> 193
EXHIBIT 2.2
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
GAS PRODUCTION IMBALANCES
<TABLE>
<CAPTION>
PROPERTY NAME 10/1/99 IMBALANCE IN MCF VALUE/MCF
------------- ------------------------ ---------
<S> <C> <C>
Lathrop GU #6 (151) $1.75
</TABLE>
<PAGE> 194
EXHIBIT 3.4
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
TITLE DEFECT NOTICE
AR-_______
submitted by
FUTURE ACQUISITION 1995, LTD.
Claim No. Date Issued to ARCO:
------------------------ -----------------
***
State: County:
---------------------------- ---------------
Property Name: ARCO Property Code:
------------------------- -----------------
ARCO Lease/Contract/DOI Numbers:
A. BRIEF DESCRIPTION OF MATTER CONSTITUTING THE CLAIMED TITLE DEFECT:
BPO APO
WI NRI WI NRI
P&SA
Exhibit A:
-------- -------- -------- ---------
Research
Results:
-------- -------- -------- ---------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
B. CLAIMED PURCHASE PRICE REDUCTION ATTRIBUTABLE TO THE CLAIMED TITLE
DEFECT:
Allocated Purchase Price: $
------------------
Claimed Adjustment: $
------------------
Adjusted Allocated Purchase Price: $
------------------
C. ARCO RESPONSE/APPROVAL:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
***
Verified by: Date:
-------------------------- -----------------
(ARCO Landman)
Reviewed by: Date:
-------------------------- -----------------
(ARCO Attorney)
Approved by: Date:
-------------------------- -----------------
(C&EA Manager)
xc: Darren Groce, ARCO Legal Department, Midland
<PAGE> 195
EXHIBIT 3.6
Attached to and made a part of that certain Purchase & Sale Agreement effective
as of October 1, 1999, by and between Atlantic Richfield Company (ARCO)
and Future Acquisition 1995, Ltd. (Purchaser)
ALLOCATION OF VALUE
<TABLE>
<CAPTION>
============================================================================================================
ASSET NAME/DESCRIPTION TOTAL VALUE
---------------------- -----------
<S> <C>
Sun Buy/Sell Crude Oil Contract $305,000.00
- ------------------------------------------------------------------------------------------------------------
Office / Warehouse / Furnishings / Computers $5,000.00
- ------------------------------------------------------------------------------------------------------------
Warehouse Inventory $30,000.00
- ------------------------------------------------------------------------------------------------------------
Cars / Trucks $15,000.00
- ------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PROPERTY NAME ARCO PROPERTY CODE COUNTY TOTAL VALUE PRP
------------- ------------------ ------ ----------- ---
<S> <C> <C> <C> <C>
A. TOOKE GAS UNIT WELL #1 (ORRI) 411005600 GREGG $ 45,000.00
- ------------------------------------------------------------------------------------------------------------
A. L. BACLE GAS UNIT WELL #1 (ORRI) 416326501 GREGG $ 4,500.00
- ------------------------------------------------------------------------------------------------------------
A. V. BACLE (RI) 415656100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
ADAMS 412025600 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
AKIN, J. W. "B" 412051500 GREGG $165,000.00
- ------------------------------------------------------------------------------------------------------------
AKIN, J. W. "A" 412050700 GREGG $ 46,000.00
- ------------------------------------------------------------------------------------------------------------
AKIN, J. W. "A" (RI) 412053100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
AKIN, J. W. GAS UNIT #1 (0RRI) 414142300 GREGG $ 27,000.00
- ------------------------------------------------------------------------------------------------------------
ANDERSON, W. M. (ORRI) 410005100 GREGG $ 13,000.00
- ------------------------------------------------------------------------------------------------------------
ANDERSON (ORYX) 412095701 GREGG $ 5,000.00 Y
- ------------------------------------------------------------------------------------------------------------
ANDREWS, S. G. 412110400 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
ANNIE FENTON UNIT #1 WELL (ORRI) 437025200 GREGG $ 6,500.00
- ------------------------------------------------------------------------------------------------------------
ARCO TOOKE (ORRI) 410552400 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
BANDER 412205400 GREGG $200,000.00 Y
- ------------------------------------------------------------------------------------------------------------
BARNES, JETTIE A45(616,650318) (RI) 410427700 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
BARNSWELL B & C (ORYX) 412220801 GREGG $ 5,000.00 Y
- ------------------------------------------------------------------------------------------------------------
BRAWLEY, W. L. (776) (RI) 410462500 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
BURNSIDE "A" 412640800 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
CALDWELL, DALLAS (R) 415348100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
CARR S "A" (RI) 413269600 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
CARR, S "B" (RI) 418573100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
F. C. CHRISTIAN (RI) 415345600 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
CHRISTIAN, JM GAS UNIT (RI) 400060900 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
CLEMENS #3 (RI) 414145800 GREGG $ 11,700.00
- ------------------------------------------------------------------------------------------------------------
CLEMENS GAS UNIT #1 (RI) 435321800 GREGG $ 8,600.00
- ------------------------------------------------------------------------------------------------------------
CLEMENS, E.W. (RI) 412816800 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
COBB, WM. (A-356,950) (RI) 410503600 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
COBB, WM. (9232,875) (RI) 410500100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
COLE (659992, ETC) (RI) 410506100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
COLE, M. T. (RI) 417163200 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
DAVIS GAS UNIT "E" #2 & #3 (ORRI) 413452400 GREGG $ 25,000.00 Y
- ------------------------------------------------------------------------------------------------------------
DUNCAN 413275100 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
ELDER OIL UNIT "3" (RI) 416021500 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
1
</TABLE>
<PAGE> 196
<TABLE>
<CAPTION>
PROPERTY NAME ARCO PROPERTY CODE COUNTY TOTAL VALUE PRP
------------- ------------------ ------ ----------- ---
<S> <C> <C> <C> <C>
ELDER OIL UNIT, FRANK & JS (ORRI & RI) 416024000 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
FENTON NO. 1 (ORRI) 435322600 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
FISHBURN 413495800 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
FISHBURN #1 GAS UNIT (ORRI) 415689700 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
FISHER 413500800 GREGG $1,000,000.00
- ------------------------------------------------------------------------------------------------------------
FISHER, CADDIE (RI) 415322700 GREGG $ 12,000.00
- ------------------------------------------------------------------------------------------------------------
FLEMISTER (RI) 413521100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
FOSTER "A" 413555500 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
FOSTER "B" 413560100 GREGG $ 15,000.00
- ------------------------------------------------------------------------------------------------------------
G. B. TENNERY 419501900 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
G. W. RICHEY GAS UNIT #2 (RI) 410689000 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
G. W. RICHEY 1-H (RI) 412525800 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
HALE, H. P. (ORRI) 416025800 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
HARRIS (CONOCO) 37.5% 419499301 GREGG $ 745,000.00
- ------------------------------------------------------------------------------------------------------------
HARRIS (CONOCO) 62.5% 419499300 GREGG Included in above
- ------------------------------------------------------------------------------------------------------------
HARRIS, T. B. 414010900 GREGG $1,250,000.00
- ------------------------------------------------------------------------------------------------------------
HAYS A & B 414060500 GREGG $ 50,000.00 Y
- ------------------------------------------------------------------------------------------------------------
HOPKINS 414245400 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
HOUSTON STEPHENS UNIT #1-X (ORRI) 437450900 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
HUGHEY "A" (WELL #5) 414275600 GREGG $ 5,000.00 Y
- ------------------------------------------------------------------------------------------------------------
HUGHEY "A" (Except #5) 414270500 GREGG $ 4,600.00
- ------------------------------------------------------------------------------------------------------------
HUGHEY "B" & "C" 414280200 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
J D DAVIS - E- GAS UNIT #5 (ORRI) 410325401 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
J D DAVIS-E-GAS UNIT #4 (ORRI) 410325400 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
J. R. WILLIAMS GAS UNIT #1 415698600 GREGG $ 11,700.00
- ------------------------------------------------------------------------------------------------------------
JOHNSON, DORA 414415500 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
JONES, ALF (187446, 846) (RI) 410702100 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
JONES, CLEM (465905) (RI) 410703900 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
KING, A. A. "A" 414536400 GREGG $ 14,500.00
- ------------------------------------------------------------------------------------------------------------
KING, A. A. "B" 414537200 GREGG $ 11,600.00
- ------------------------------------------------------------------------------------------------------------
KING, A. A. "C" 414539900 GREGG $ 4,600.00
- ------------------------------------------------------------------------------------------------------------
KING, A. A. "D" 414538100 GREGG $ 4,600.00
- ------------------------------------------------------------------------------------------------------------
LATHROP GAS UNIT 417898000 GREGG $ 19,000.00
- ------------------------------------------------------------------------------------------------------------
LAWSON, MARY 414700600 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
LEE, T. W. 414745600 GREGG $ 39,900.00
- ------------------------------------------------------------------------------------------------------------
M. LEMAIRE (RI) 418989200 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
MATTIE MONCRIEF+A100 (ORRI) 411129000 GREGG $ 65,000.00
- ------------------------------------------------------------------------------------------------------------
MC GEORGE 415095300 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
M. C. SALTER GAS UNIT (RI) 417654500 GREGG $ 12,700.00
- ------------------------------------------------------------------------------------------------------------
MONCRIEF, MATTIE 415270100 GREGG $ 73,000.00
- ------------------------------------------------------------------------------------------------------------
ORR, J W GAS UNIT #1 (RI) 414143100 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE> 197
<TABLE>
<CAPTION>
PROPERTY NAME ARCO PROPERTY CODE COUNTY TOTAL VALUE PRP
------------- ------------------ ------ ----------- ---
<S> <C> <C> <C> <C>
P C CASTLEBERRY GAS UNIT (ORRI) 414681600 GREGG $ 9,100.00
- ------------------------------------------------------------------------------------------------------------
PENN 415610200 GREGG $ 54,000.00
- ------------------------------------------------------------------------------------------------------------
PERSONS, J. C. #1A (ORRI) 437451701 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
PET HOPKINS GAS UNIT (RI) & (ORRI) 437459203 GREGG $ 4,600.00
- ------------------------------------------------------------------------------------------------------------
R. CHRISTIAN (RI) 412225900 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
RICHEY, G. W. (4007262, 263 & 264) (RI) 410863900 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
RICHEY, G. W. (468402) (RI) 410862100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
RODDEN 415890300 GREGG $ 14,600.00
- ------------------------------------------------------------------------------------------------------------
SHILOH SCHOOL GAS UNIT #1 (ORRI) 411006400 GREGG $ 4,800.00
- ------------------------------------------------------------------------------------------------------------
SMITH, S. G. 416245500 GREGG $183,200.00
- ------------------------------------------------------------------------------------------------------------
STILL, C. L. (ORRI) 416017700 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
STUCKY THRASHER GAS UNIT (ORRI) 412345000 GREGG $ 22,000.00
- ------------------------------------------------------------------------------------------------------------
T. B. HARRIS GAS UNIT #2 (RI & ORRI) 437459200 GREGG $ 18,000.00
- ------------------------------------------------------------------------------------------------------------
T. B. HARRIS GAS UNIT #3 (RI & ORRI) 437459201 GREGG $ 12,200.00
- ------------------------------------------------------------------------------------------------------------
T. B. HARRIS GAS UNIT #5 (RI & ORRI) 437459202 GREGG $ 12,700.00
- ------------------------------------------------------------------------------------------------------------
T. W. LEE GAS UNIT 415131300 GREGG $ 26,000.00
- ------------------------------------------------------------------------------------------------------------
TOOKE A (RI) 413013800 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
TOOKE B (RI) 413014600 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
TOOKE "B" 416530600 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
TURNER 416570500 GREGG $150,000.00 Y
- ------------------------------------------------------------------------------------------------------------
TUTTLE "B" 416580200 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
TUTTLE "C" 416585300 GREGG $ 26,000.00
- ------------------------------------------------------------------------------------------------------------
WHATLEY 416815100 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
WHEELER (RI) 415346400 GREGG $ 8,600.00
- ------------------------------------------------------------------------------------------------------------
WHEELER (419112,403) (RI) 410976700 GREGG $ 8,600.00
- ------------------------------------------------------------------------------------------------------------
WHEELER "A"+A129 (10880, 419100) (RI) 410977500 GREGG $ 8,600.00
- ------------------------------------------------------------------------------------------------------------
WILLIAMS, JOHN R. 416830500 GREGG $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
WILSON 416855100 GREGG $ 37,200.00
- ------------------------------------------------------------------------------------------------------------
WILSON, J. W. (ORRI) 410006900 GREGG $ 22,900.00
- ------------------------------------------------------------------------------------------------------------
J. T. JETER ESTATE GAS UNIT WELL #1 (RI) 413101100 GREGG/ UPSHUR $ 16,000.00
- ------------------------------------------------------------------------------------------------------------
BEALL, J. R. (RI) 410433100 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
BEAN, MARY B. 412270400 RUSK $150,000.00
- ------------------------------------------------------------------------------------------------------------
BEAN, NAT "A" & "B" (RI) 417060100 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
CHRISTIAN "C" 410495100 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
DE GUERIN, M. C. (RI) 417260400 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
DE GUERIN, M. C. (22) (RI) 410533800 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
GILES "C" WELL #1-C (ORRI) 41081161C RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
JERNIGAN, W. M. (26-432); 5704) (RI) 410684900 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
KENNEDY, MAJOR "B" 414492900 RUSK $ 51,000.00
- ------------------------------------------------------------------------------------------------------------
MASON #1 GAS UNIT (RI) 415029500 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
MASON HEIRS #1 A145 (RI) 415031700 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 198
<TABLE>
<CAPTION>
PROPERTY NAME ARCO PROPERTY CODE COUNTY TOTAL VALUE PRP
------------- ------------------ ------ ----------- ---
<S> <C> <C> <C> <C>
MASON, J. F. (21) (RI) 410762400 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
MASON, R. G. (16)+A150 (RI) 410763200 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
MASON, T. O. (466902) (RI) 410761600 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
PERKINS, A. K. (467904) (RI) 410834500 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
PRICE, J. M. (ORRI) 415719200 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
RUFUS JONES "A" 415959400 RUSK $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
SCHUYLER (188215 & 615) (RI) 410890600 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
SCHUYLER "A" (26-768,5101) (RI) 410891400 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
SCHUYLER "B" (26-769-4970) (RI) 410892200 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
SOUTH KILGORE UNIT 417539500 RUSK $10,500,500.00 Y
- ------------------------------------------------------------------------------------------------------------
STRICKLAND - B 417880700 RUSK $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
WATSON, J. R. (ORRI) 416023100 RUSK $ 7,500.00 Y
- ------------------------------------------------------------------------------------------------------------
WM. BRITTAIN 412323900 RUSK $ 188,900.00
- ------------------------------------------------------------------------------------------------------------
A. L. JENKINS (RI) 415553000 UPSHUR $ 1,200.00
- ------------------------------------------------------------------------------------------------------------
J H SABEY GAS UNIT 417896300 UPSHUR $ 1,100.00
- ------------------------------------------------------------------------------------------------------------
PETTY GAS UNIT 415000700 UPSHUR $ 8,100.00
- ------------------------------------------------------------------------------------------------------------
RUBEY ESTATE GAS UNIT 416000200 UPSHUR $ 33,300.00
- ------------------------------------------------------------------------------------------------------------
WATTS HEIRS GAS UNIT 411578300 UPSHUR $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
E. A. WATTS (8985) (RI) 410968600 UPSHUR $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
WEBB #1 (RI) 413546600 UPSHUR $ 16,000.00
- ------------------------------------------------------------------------------------------------------------
E. F. JOHNSON GAS UNIT 411001300 UPSHUR/ GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
ROSE KIRKPATRICK GAS UNIT 410900700 UPSHUR/ GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
D A PORTER GAS UNIT (ORRI) 410345900 UPSHUR/GREGG $ 25,500.00
- ------------------------------------------------------------------------------------------------------------
G. W. RICHEY AND ENERGY CO. (RI) 412689100 GREGG $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
ARTERBERRY HEIRS UT. 413000600 SMITH $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
FAYE PITTMAN WILLEFORD 400050100 UPSHUR $ 2,300.00
- ------------------------------------------------------------------------------------------------------------
TOTAL $16,000,000.00
============================================================================================================
</TABLE>
4
<PAGE> 199
EXHIBIT 4.7
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
MATERIAL CHANGES IN LAST YEAR
None
<PAGE> 200
EXHIBIT 4.9
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
MATERIAL DEFECTS
None
<PAGE> 201
EXHIBIT 4.16
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
PENDING AND PROPOSED OPERATIONS AND CAPITAL PROJECTS
None
<PAGE> 202
EXHIBIT 9.6
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
LITIGATION
1. Madera v. Atlantic Richfield Company
Civil Action No. 396CV2951-R
United States District Court for the Northern Jurisdiction of Texas
Dallas Division
2. Stanley G. Marshall, Jr., et al v. ARCO Oil & Gas Company, a division of
Atlantic Richfield Company
Civil Action No. 3217
District Court of 49th Judicial District, Zapata County, Texas
Modified Judgement
Abstract of Judgment filed in various courthouses around the State,
including Rusk County, Texas.
Supersedeas Bond obtained by ARCO Oil & Gas Company, approved and filed by
the Zapata County District Clerk on July 2nd, 1998
3. Harris, et al v. East Texas Salt Water Disposal Company, et al
Cause No. 96-04
District Court of 4th Judicial District, Rusk County, Texas
<PAGE> 203
EXHIBIT 10.2(a)
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
FORM OF CONVEYANCE, ASSIGNMENT AND BILL OF SALE
Recording Requested by and STATE:
When Recorded Return to: ----------------
COUNTY:
- ----------------------------------- ----------------
- -----------------------------------
- -----------------------------------
CONVEYANCE, ASSIGNMENT AND BILL OF SALE
This Conveyance, Assignment and Bill of Sale ("Assignment"), dated
effective as of 7:00 a.m. Central Standard Time, on October 1, 1999 (the
"Effective Time"), is from Atlantic Richfield Company, a Delaware corporation
("Assignor"), whose address is 600 North Marienfeld, Midland, Texas 79701, to
Future Acquisition 1995, Ltd., a Texas Limited Partnership, ("Assignee"), whose
address is 700 Louisiana, Suite 3700, Houston, TX 77002.
PART I
GRANTING AND HABENDUM CLAUSES
For ten dollars ($10.00) and other good and valuable consideration, the
receipt and sufficiency of which Assignor hereby acknowledges, Assignor has
transferred, bargained, conveyed, and assigned, and does hereby transfer,
bargain, convey, and assign to Assignee, effective for all purposes as of the
Effective Time, all of the right, title and interest of Assignor in and to the
following properties and assets (such properties and assets being hereinafter
called the "Assets"):
(a) The oil, gas and mineral leasehold estates and other real property and
mineral interests described in Exhibit A, together with all of ARCO's
rights in respect of any pooled, communitized or unitized acreage of which
any such interest is a part (collectively, the "Leasehold Interests");
(b) To the extent same are specifically attributable or allocable to the
Leasehold Interests, (i) all wells, equipment and facilities that, as of
the Closing Date, are located on and used solely and directly in connection
with the production or treatment of oil and gas from the Leasehold
Interests, (ii) all oil and gas and other hydrocarbon volumes produced on
or after the Effective Date, (iii) to the extent same are assignable or
transferable by ARCO without restriction under applicable law or
third-party agreements (without the payment of any funds or other
consideration), all orders, contracts, agreements and other instruments
(excluding any instruments subject or relating to attorney/client
privilege), (iv) to the extent same are assignable or transferable by ARCO
under applicable law or third-party agreements (without the payment of any
funds or other consideration), all easements, authorizations, permits and
similar rights and interests, and (v) all other rights, privileges,
benefits, powers and obligations conferred or imposed upon the owner and
holder of the Leasehold Interests;
(c) Any and all mineral fee interests, mineral servitudes, royalty
interests, overriding royalty interests, net profits interests, production
payments and all other interests of every kind and character in and to the
properties and lands described on Exhibit A and/or which relate to the
Leasehold Interests, the lands covered thereby or the production of
hydrocarbons therefrom;
(d) All office buildings, warehouses, other buildings and permanent
improvements, surface leases, vehicles, trucks, warehouse inventory, parts,
supplies, office furniture, fixtures and equipment, computers, printers,
telephone systems and all other tangible assets used or held for use in
connection with ARCO's ownership or operation of the Leasehold Interests
and other Assets;
(e) That certain Crude Oil Buy/Sell Contract made and entered into
effective December 1, 1995, by and between ARCO Permian, a unit of Atlantic
Richfield Company, and Sun Company, Inc. (R&M), as amended from time to
time, insofar as applicable to the Leasehold Interests;
(f) All casing leak allowable transfers, earned salt water allowables, key
well allowable transfers and similar rights and interests related to or
arising out of the Leasehold Interests and the production of and rights to
produce hydrocarbons therefrom; and
(g) To the extent same are specifically attributable or allocable to the
Leasehold Interests, originals, to the extent available, or copies of the
following records: (i) lease and land records, (ii) development geological
records, (ii) operations, production and engineering records, and (iii)
facility and well records, in each case excluding any exploration
geological records, any interpretive or forecast data, any records subject
or relating to attorney/client privilege and any such records or data that
are not assignable pursuant to the terms of applicable law or third-party
agreements (without the payment of any funds or other consideration)
(collectively, the "Records").
<PAGE> 204
SAVE AND EXCEPT the assets and properties described in Exhibit B and
any other assets and properties excluded pursuant to the terms hereof, and all
other property, real, personal or intellectual, not expressly covered herein in
Section 1.1 (the "Excluded Assets").
TO HAVE AND TO HOLD, subject to the terms, exceptions and other
provisions herein stated, the Assets unto Assignee, its successors and assigns,
forever.
PART II
MISCELLANEOUS
2.1 DISCLAIMER OF WARRANTY; SUBROGATION. The assignments and
conveyances made by this Assignment are made without warranty of title, express,
implied, or statutory, and without recourse, even as to the return of the
purchase price or other consideration, but with full substitution and
subrogation of Assignee, and all persons claiming by, through and under
Assignee, to the extent assignable, in and to all covenants and warranties of
Assignor's predecessors in title and with full subrogation of all rights
accruing under the applicable statutes of limitation or prescription under the
laws of the state where the Assets are located and all rights of actions of
warranty against all former owners of the Assets. Any covenants or warranties
implied by statute or law by the use of the words "transfer," "convey,"
"bargain" or "assign" or other similar words used in this Assignment are hereby
expressly disclaimed, waived and negated.
2.2 FURTHER DISCLAIMERS. Assignor and Assignee agree that, to the
extent required by applicable law to be operative, the disclaimers of certain
warranties contained in this paragraph are "conspicuous" disclaimers for the
purposes of any applicable law, rule or order. The Assets are assigned to
Assignee without recourse (even as to the return of the purchase price or other
consideration), covenant or warranty of any kind, express, implied or statutory.
WITHOUT LIMITING THE EXPRESS PROVISIONS HEREOF, ASSIGNEE SPECIFICALLY AGREES
THAT ASSIGNOR IS CONVEYING THE ASSETS ON AN "AS-IS, WHERE-IS, WITH ALL FAULTS"
BASIS AND WITHOUT REPRESENTATION OR WARRANTY, EITHER EXPRESS, IMPLIED AT COMMON
LAW, BY STATUTE OR OTHERWISE, OR STATUTORY (ALL OF WHICH ASSIGNOR HEREBY
DISCLAIMS), RELATING TO (i) TITLE, (ii) TRANSFERABILITY, (iii) FITNESS FOR ANY
PARTICULAR PURPOSE, MERCHANTABILITY, DESIGN OR QUALITY, (iv) COMPLIANCE WITH
SPECIFICATIONS OR CONDITIONS REGARDING OPERATION, (v) FREEDOM FROM PATENT OR
TRADEMARK INFRINGEMENT, (vi) ABSENCE OF LATENT DEFECTS, OR (vii) ANY OTHER
MATTER WHATSOEVER. THE PROVISIONS OF THIS SECTION HAVE BEEN NEGOTIATED BY
ASSIGNEE AND ASSIGNOR AFTER DUE CONSIDERATION AND ARE INTENDED TO BE A COMPLETE
EXCLUSION AND NEGATION OF ANY REPRESENTATIONS OR WARRANTIES OF ASSIGNOR, EITHER
EXPRESS, IMPLIED OR STATUTORY WITH RESPECT TO THE SUBJECT PROPERTY THAT MAY
ARISE PURSUANT TO ANY LAW NOW OR HEREAFTER IN EFFECT OR OTHERWISE EXCEPT AS
EXPRESSLY SET FORTH HEREIN OR IN THAT CERTAIN PURCHASE AND SALE AGREEMENT DATED
EFFECTIVE OCTOBER 1, 1999, BETWEEN ASSIGNOR AND ASSIGNEE.
2.3 FURTHER ASSURANCES. The parties agree to take all such further
actions and execute, acknowledge and deliver all such further documents that are
necessary or useful in carrying out the purposes of this Assignment. So long as
authorized by applicable law so to do, (i) Assignor agrees to execute,
acknowledge and deliver to Assignee all such other additional instruments,
notices, division orders, transfer orders and other documents and to do all such
other and further acts and things as may be necessary to more fully and
effectively convey and assign to Assignee the Assets conveyed hereby or intended
so to be conveyed; and (ii) Assignee agrees to execute, acknowledge and deliver
to Assignor all such other additional instruments, notices, division orders,
transfer orders and other documents and to do all such other and further acts
and things as may be necessary to more fully and effectively evidence Assignor's
rights in and to the Excluded Assets.
2.4 SUCCESSORS AND ASSIGNS. This Assignment shall bind and inure to the
benefit of Assignor and Assignee and their respective successors and assigns.
2.5 GOVERNING LAW. This Assignment shall be governed by and interpreted
in accordance with the laws of the State of Texas, without regard to any
conflicts of law rule that would direct application of the laws of another
jurisdiction, except to the extent that it is mandatory that the law of some
other jurisdiction, wherein the Assets are located, shall apply.
2.6 EXHIBITS. All Exhibits attached hereto are hereby made a part
hereof and incorporated herein by this reference. References in such Exhibits to
instruments on file in the public records are made for all purposes. Unless
provided otherwise, all recording references in such Exhibits are to the
appropriate records of the counties in which the Assets are located.
2.7 CAPTIONS. The captions in this Assignment are for convenience only
and shall not be considered a part of or affect the construction or
interpretation of any provision of this Assignment.
2.8 COUNTERPARTS. This Assignment may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
2.9 GOVERNMENTAL ASSIGNMENTS. Separate assignments of certain parts of
the Leasehold Interests may be executed on officially approved forms by Assignor
to Assignee in sufficient counterparts to satisfy applicable statutory and
regulatory requirements. Those assignments shall be deemed to contain all of the
exceptions, reservations, rights, titles, power and privileges set forth herein
as fully as though they were set forth in each such assignment. The interests
conveyed by such separate assignments are the same, and not in addition to, the
Leasehold Interests conveyed herein.
<PAGE> 205
2.10 RECORDATION. To facilitate recording or filing of this Assignment,
(i) the counterpart to be recorded in a given county may contain only those
portions of the Exhibits that describe property located in that county, and (ii)
each counterpart filed with a federal or state agency or office may contain only
those portions of the Exhibits that describe property under the jurisdiction of
that agency or office. Assignor and Assignee have each retained a counterpart of
this Assignment with complete Exhibits. Another counterpart of this Assignment
with complete Exhibits is to be filed in the official real property records of
__________ County, __________.
2.11 ACCESS ACROSS LEASEHOLD INTERESTS. Assignee agrees to allow
Assignor access, at no cost or expense to Assignor, to or across the Leasehold
Interests, if Assignor conducts future operations in the vicinity of the
Leasehold Interests or with respect to the Excluded Assets.
EXECUTED on _______________, 199__, to be effective for all
purposes as of the Effective Time.
ASSIGNOR:
ATLANTIC RICHFIELD COMPANY
By:
-------------------------------
T. L. Holland, Attorney in Fact
ASSIGNEE:
FUTURE ACQUISITION 1995, LTD.
("PURCHASER")
BY: FUTURE PETROLEUM CORPORATION,
ITS GENERAL PARTNER
By:
-------------------------------
Tim J. Goff, President
<PAGE> 206
ACKNOWLEDGMENTS
STATE OF TEXAS )
)
COUNTY OF MIDLAND )
This instrument was acknowledged before me on this _____ day of
_________________, 1999, by T. L. Holland, as Attorney-in-Fact of ATLANTIC
RICHFIELD COMPANY.
-----------------------------------
Notary Public in and for
the State of
----------
My commission expires:
------------
STATE OF )
---------- )
COUNTY OF )
----------
This instrument was acknowledged before me on this _____ day of
__________, 199__, by _________________________, as ________________ of
______________________.
-----------------------------------
Notary Public in and for
the State of
----------
My commission expires:
------------
LIST OF EXHIBITS:
Exhibit A _ Leasehold Interests
Exhibit B _ Excluded Assets
<PAGE> 207
EXHIBIT 10.2(d)
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
First Reserve Oil & Gas Co. (Purchaser)
PROPERTY TRANSFER ACCOUNTING AGREEMENT
ASSIGNOR: ASSIGNEE:
-------------------------------- ----------------------
PROPERTY: PROPERTY CODE:
-------------------------------- ------------------
STATE: Texas COUNTY:
OPERATOR:
--------------------------------
EFFECTIVE DATE OF TRANSFER:
OIL PURCHASER: GAS PURCHASER:
--------------------------- ----------------
NOTE: SOME ITEMS MAY OR MAY NOT APPLY IN THE FINAL AGREEMENT TO BE SIGNED AT
CLOSING. ALL DATES ARE TENTATIVE AND WILL BE ALTERED PENDING ON THE ACTUAL
CLOSING DATE AND CHANGE OF OPERATORSHIP.
ASSIGNOR and ASSIGNEE hereby agree that:
1. ASSIGNOR will continue to pay all applicable royalties and severance taxes
through the production month of ___________ as it pertains to ASSIGNOR's
interest. ASSIGNEE will be responsible for marketing, collection of revenue
and payment of royalties and taxes on any production subsequent to this
date, if applicable.
2. ASSIGNOR will continue to pay all invoices with an occurrence date through
the date of operator change. All other expenditures (ie: utility bill,
etc.) will either be paid by ASSIGNOR and charged to the ASSIGNEE in the
final accounting settlement, or the applicable invoices will be returned to
the vendor for rebilling to ASSIGNEE.
3. ASSIGNOR will continue to prepare and file all required regulatory and
other monthly production reports through the production month of
___________. Copies of reports for periods after the Effective Date shown
above will be provided to the ASSIGNEE with the final accounting
settlement. ASSIGNEE will provide at closing any required notification to
regulatory agencies regarding change of ownership as of _________.
ASSIGNEE agrees to assume operations on ___________.
4. ASSIGNOR will notify all utility companies of the change in ownership
immediately after closing.
5. ASSIGNOR will provide Letters-in-Lieu of Transfer Orders, to be executed at
closing, and ASSIGNEE will provide them to the product purchasers
immediately after closing.
6. (ASSIGNOR/ASSIGNEE) will pay any applicable current year ad valorem taxes.
Any tax statements received by the non-paying party will be promptly
forwarded to the paying party for payment. Proration of taxes through the
Effective Date shown above will be made by the paying party as part of the
final accounting settlement.
ACCEPTED AND AGREED TO THIS DAY OF , 1999.
------ -----------------
------------------------------ ----------------------------
"ASSIGNOR" "ASSIGNEE"
By: By:
--------------------------- ------------------------
Name: Name:
---------------------- -------------------
Title: Title:
--------------------- ------------------
<PAGE> 208
EXHIBIT 10.2(l)
Attached to and made a part of that certain
Purchase & Sale Agreement effective as of October 1, 1999,
By and between Atlantic Richfield Company (ARCO) and
Future Acquisition 1995, Ltd. (Purchaser)
FORM OF SURFACE LEASE AGREEMENT
THIS LEASE AGREEMENT is made effective and entered into this 1st day of October,
1999, by and between ATLANTIC RICHFIELD COMPANY, a Delaware corporation, whose
address is P.O. Box 1610, Midland, Texas 79702-1610, hereinafter called
"Lessor", and FUTURE ACQUISITION 1995, LTD., a Texas limited partnership, whose
address is 700 Louisiana, Suite 3700, Houston, Texas 77002, hereinafter referred
to as "Lessee".
LESSOR FOR AND IN CONSIDERATION of the rents, covenants and promises herein
contained to be kept, performed and observed by Lessee, does hereby lease and
demise to Lessee, and Lessee does hereby rent and accept from Lessor, that real
property, referred to as the leased premises and more particularly described in
EXHIBIT "A", attached hereto and made a part hereof, for the purposes of
construction, installation, maintenance, inspection, operation, repair, change
or removal of equipment and facilities useful or incidental to the operation of
the office building and pipe yard located and established at 1907 East Old
Highway 80, Longview, Texas 75605, together with the right of ingress and egress
to and from the leased premises.
TO HAVE AND TO HOLD the said leased premises, together with all rights,
privileges, easements, appurtenances and immunities belonging to or in any way
appertaining to said leased premises, including, but not limited to, concurrent
use of, any and all easements, rights, title and privileges of Lessor now or
hereafter existing in, to or under the leased premises.
1. This lease shall be for a term of ten (10) years, referred to as the lease
term, commencing on October 1, 1999, and ending on September 30, 2009;
subject, however, to earlier termination as hereinafter provided.
2. Lessee may extend this lease for additional periods of five (5) years by
giving Lessor written notice of Lessee's intention to do so at least three
(3) months prior to the expiration of the expiring term. Such notice will
be sent to Lessor at the heretofore-stated address. This lease shall
terminate and become null and void without further notice on the expiration
of the term specified, and any holding over by Lessee after the expiration
of said term shall not constitute a renewal hereof or give Lessee any
rights hereunder in or to the leased premises.
3. The consideration for this lease is FIVE THOUSAND DOLLARS AND NO/100
($5,000) cash in hand paid by Lessee to Lessor, receipt of which is hereby
acknowledged, which said amount shall cover the rental hereunder for the
period of October 1, 1999 to September 30, 2000. A like rental payment
shall be due on October 1, 2000 and each subsequent anniversary date hereof
during the term hereof. All rental payments accruing hereunder shall be
payable to Lessor in Midland, Texas, by mailing same to Lessor at P.O. Box
1610, Midland, Texas 79702-1610. In the event any rental payment which may
become due and payable hereunder is not duly paid when due, then in that
event said Lessor may, at its option pursue such remedy or remedies as may
be available to it for the collection of such amount or amounts due and
owing to it, declare a forfeiture of the rights of the Lessee, in which
event all rights of the Lessee hereunder shall cease and terminate, or
both, and said Lessor shall have the right to immediate possession of said
premises. In the event said Lessor shall elect to declare forfeiture hereof
as aforesaid, said Lessee shall nevertheless be liable to said Lessor for
the payment of rentals for the period of time this lease has remained in
force pursuant hereto; and the rental for any fractional part of said
yearly period during which said lease shall have been in force shall be
deemed to be a full year's rental. If Lessee chooses to exercise its option
to renew for additional consecutive five (5) year term or terms, the rental
during each successive five-year term shall be twenty-five percent (25%)
more than the rental paid during the immediately preceding five-year term.
If Lessee elects to renew for an additional term, it shall do so by giving
Lessor written notice as described above. Each subsequent payment for each
five (5) year renewal shall be paid on or before the expiration date of the
previous term.
4. In addition to the rental, Lessee shall pay and discharge all taxes,
general and special assessments, fines or penalties incurred on or after
October 1, 1999 and other charges of every description which during the
term of this lease may be levied on or assessed against Lessor's and
Lessee's interests in the leased premises and all improvements and other
property thereon.
5. Any and all material, buildings, structures, equipment and all property of
whatsoever kind or character placed or used on the subject property by the
Lessee shall remain the property of Lessee and Lessee shall have the full
and complete right at any time during the term of this lease, or within a
reasonable time after the abandonment or termination hereof, not to exceed
one year, 6 months, to go upon the subject property and remove said
property therefrom.
6. Lessee may, at any time and from time to time, encumber the leasehold
interest, by deed of trust, mortgage or other security instrument, without
obtaining the consent of Lessor, but no such encumbrance shall constitute a
lien on the fee title of Lessor, and the indebtedness secured thereby,
shall at all times be and remain inferior and subordinate to all the
conditions, covenants and obligations of this lease and to all of the
rights of the Lessor hereunder.
7. In the event the leased premises or any part thereof shall be taken for
public or quasi-public purposes by condemnation as a result of any action
or proceeding in eminent domain, or shall be transferred in lieu of
condemnation to any authority entitled to exercise the power of eminent
domain, the interests of Lessor
<PAGE> 209
and Lessee in the award or consideration for such transfer and the effect
of the taking or transfer on this lease shall be as provided by this
article.
a) In the event the entire leased premises is taken or so transferred,
this lease and all of the right, title and interest thereunder shall
cease on the date title to such land so taken or transferred vests in
the condemning authority, and the proceeds of such condemnation shall
be divided so that Lessor shall receive all of such proceeds insofar
and only insofar as they pertain to the title to the surface of the
land, and any improvements placed thereon by Lessor, and Lessee shall
receive all such proceeds insofar and only insofar as they pertain to
the title to the improvements of Lessee existing on the leased
premises.
b) In the event of the taking or transfer of only a part of the leased
premises leaving the remainder of the premises in such location, or in
such form, shape or reduced size as to be not effectively and
practicably usable in the opinion of Lessee for the purpose of
operation thereon of Lessee's business, this lease and all right,
title and interest thereunder shall cease on the date title to the
land or the portion thereof so taken or transferred vests in the
condemning authority.
c) In the event of such taking of only a part of the leased premises
leaving the remainder of the premises in such location and in such
form, shape or size as to be used effectively and practicably in the
opinion of Lessee for the purpose of operation thereon of Lessee's
business, this lease shall terminate and end as to the portion of the
premises so taken or transferred as of the date title to such portion
vests in the condemning authority, but shall continue in full force
and effect as to the portion of the leased premises not so taken or
transferred. From and after such date, the rental required to be paid
by Lessee to Lessor shall be reduced during the unexpired portion of
this lease to that proportion of the annual fixed rental herein
reserved which the value of the part of the leased premises not so
taken bears to the value of the total of the leased premises, such
values to be determined as of the date of the actual commencement of
the physical taking of said premises when Lessee is disturbed in his
possession as a result thereof but immediately before any actual
taking. Lessee shall, however, continue to pay the full amount of
percentage rent due hereunder.
d) A voluntary conveyance by Lessor to a public utility, agency or
authority under threat of a taking under the power of eminent domain
in lieu of formal proceedings shall be deemed a taking within the
meaning of this article.
9. Lessee shall use its best efforts to materially comply with all applicable
laws, rules and regulations of any governmental authorities in connection
with its use of the subject property.
10. Upon the termination of this lease, Lessee shall relinquish the leased
premises from further use and occupancy and shall leave the surface of the
leased premises in as near its original condition as is reasonably possible
and shall remove any and all material, buildings structures, equipment and
all property of whatsoever kind or character placed or used on the subject
property by Lessee.
11. No assignment of this lease, either in whole or in part, shall be effective
without first obtaining the prior written consent of Lessor.
12. Lessee shall indemnify and save Lessor harmless from all liability, damage,
environmental claims, loss, cost and expense on account of any claim or
claims asserted by any person or persons against Lessor because of bodily
injury or death or damage to property resulting to such person or persons
and arising out of Lessee's use and occupancy of the leased premises or the
conduct and operation of any business of the Lessee thereon, and Lessee
agrees, upon Lessor's request, to take over and defend, at Lessee's expense
and without cost to Lessor, any and all suits or other proceedings
instituted against Lessor by such person or persons to enforce any such
claim or claims, and to pay and satisfy in full all sums that might be
required to be paid to such person or persons, including all costs,
expenses and reasonable attorney's fees, and expert and witness fees
incurred in connection therewith.
13. Lessee shall permit Lessor or Lessor's agents, representatives or employees
to enter on the leased premises for the purpose of inspection, to determine
whether Lessee is in compliance with the terms of this lease, for purposes
of maintaining, repairing or altering the premises, or for the purposes of
showing the leased premises to prospective lessees, purchasers, mortgagees,
or for the purpose of conducting tests, monitoring operations or remedial
activities on or to the soil, surface water or groundwater or for any other
lawful reason.
14. No waiver by Lessor of any default or breach of any covenant, condition or
stipulation herein contained shall be treated as a waiver of any subsequent
default or breach of the same or any other covenant, condition or
stipulation hereof.
15. In the event Lessor shall sell or transfer the leased premises or any part
thereof and as a part of such transaction shall assign its interest as
Lessor in and to this lease, then from and after the effective date of such
sale, assignment or transfer, Lessor shall have no further liability under
this lease to Lessee except as to matters of liability which shall have
accrued and are unsatisfied as of such date, it being intended that the
covenants and obligations contained in this lease on the part of Lessor
shall be binding on Lessor and its successors and assigns only during and
in respect of their respective successive periods of ownership of the fee.
16. This agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, executors, administrators, legal
representatives, successors and assigns where permitted by this agreement.
17. This agreement shall be construed under and in accordance with the laws of
the State of Texas.
<PAGE> 210
18. In case any one or more of the provisions contained in this agreement shall
for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect
any other provision thereof and this agreement shall be construed as if
such invalid, illegal or unenforceable provision had never been contained
herein.
19. This agreement constitutes the sole and only agreement of the parties
hereto and supersedes any prior understandings or written or oral
agreements between the parties respecting the within subject matter.
20. No amendment, modification or alteration of the terms hereof shall be
binding unless the same be in writing, dated subsequent to the date hereof
and duly executed by the parties hereto.
21. The rights and remedies provided by this lease agreement are cumulative and
the use of any one right or remedy by either party shall not preclude or
waive its right to use any or all other remedies. Said rights and remedies
are given in addition to any other rights the parties may have by law,
statute, ordinance or otherwise.
22. In the event Lessor or Lessee breaches any of the terms of this agreement
whereby the party not in default employs attorneys to protect or enforce
its rights hereunder and prevails, then the defaulting party agrees to pay
the other party reasonable attorney's fees so incurred by such other party.
THIS LEASE HAS BEEN EXECUTED by the parties on the date and year first above
written.
LESSOR: LESSEE:
ATLANTIC RICHFIELD COMPANY FUTURE ACQUISITION 1995, LTD.
BY: FUTURE PETROLEUM
CORPORATION, ITS
GENERAL PARTNER
By: By:
-------------------------------- ---------------------------
T.L. Holland, Attorney-in-Fact Title:
---------------------
THE STATE OF TEXAS )
COUNTY OF MIDLAND )
This instrument was acknowledged before me on this _______ day of _________ ,
1999, by T.L. Holland, as Attorney-in-Fact of ATLANTIC RICHFIELD COMPANY, a
Delaware corporation, on behalf of said corporation.
-------------------------------------------
Notary Public in and for the State of Texas
Commission Expires:
------------------------
THE STATE OF TEXAS )
COUNTY OF )
-----------------
This instrument was acknowledged before me on this _____ day of ____________ ,
1999, by ________________________________ , as ______________________________ of
FUTURE PETROLEUM CORPORATION, a Texas corporation, as the general partner of
FUTURE ACQUISITION 1995, LTD., a Texas limited partnership, on behalf of said
partnership.
-------------------------------------------
Notary Public in and for the State of Texas
Commission Expires:
------------------------
<PAGE> 1
AS EXECUTED
U.S. $100,000,000
SECOND AMENDED AND RESTATED CREDIT AGREEMENT,
dated as of September 30, 1999,
among
BARGO ENERGY COMPANY,
as the Borrower,
CERTAIN FINANCIAL INSTITUTIONS,
as the Lenders
and
BANK OF AMERICA, N.A.,
as Administrative Agent for the Lenders
BANC OF AMERICA SECURITIES LLC
as Sole Lead Arranger and Book Manager
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS.......................................................2
1.1. Defined Terms.................................................................................2
1.2. Use of Defined Terms.........................................................................29
1.3. Cross-References.............................................................................30
1.4. Accounting and Financial Determinations......................................................31
ARTICLE II COMMITMENTS, BORROWING PROCEDURES AND NOTE............................................31
2.1. Commitments..................................................................................31
2.1.1. Revolving Credit Loans.............................................................31
2.1.2. Letters of Credit..................................................................32
2.1.3. Lenders Not Required To Make Loans Under Certain Circumstances.....................32
2.2. Reduction of Commitment Amount...............................................................32
2.2.1. Optional...........................................................................32
2.2.2. Mandatory..........................................................................33
2.3. Borrowing Procedure..........................................................................33
2.4. Continuation and Conversion Elections........................................................33
2.5. Funding......................................................................................33
2.6. Loan Accounts and Notes......................................................................34
2.7. Borrowing Base Redetermination...............................................................35
2.8. Purposes.....................................................................................36
ARTICLE III REPAYMENTS, PREPAYMENTS, INTEREST AND FEES............................................37
3.1. Repayments and Prepayments and Certain Borrowing
Base Matters.................................................................................37
3.1.1. Repayments and Prepayments.........................................................37
3.1.2. Borrowing Base Deficiencies and Asset Sales........................................38
3.2. Interest Provisions..........................................................................39
3.2.1. Rates .............................................................................39
3.2.2. Post-Maturity Rates................................................................40
3.2.3. Payment Dates......................................................................40
3.3. Fees.........................................................................................41
3.3.1. Closing Fee........................................................................41
3.3.2. Administrative Agent's Fees........................................................41
3.3.3. Commitment Fees....................................................................41
3.3.4. Letter of Credit Face Amount Fee...................................................42
3.3.5. Letter of Credit Issuance Fee......................................................42
3.3.6. Letter of Credit Administrative Fee................................................42
3.3.7. Engineering Fees...................................................................42
</TABLE>
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TABLE OF CONTENTS
CONTINUED
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
3.4. Proceeds Account.............................................................................42
ARTICLE IV LETTERS OF CREDIT.....................................................................43
4.1. Issuance Requests............................................................................43
4.2. Issuances and Extensions.....................................................................44
4.3. Lenders' Participation.......................................................................45
4.4. Disbursements................................................................................46
4.5. Reimbursement................................................................................46
4.6. Deemed Disbursements.........................................................................47
4.7. Nature of Reimbursement Obligations..........................................................47
4.8. Increased Costs; Indemnity...................................................................49
ARTICLE V CERTAIN INTEREST RATE AND OTHER PROVISIONS............................................50
5.1. LIBO Rate Lending Unlawful...................................................................50
5.2. Deposits Unavailable.........................................................................51
5.3. Increased LIBO Rate Loan Costs, etc..........................................................51
5.4. Funding Losses...............................................................................52
5.5. Increased Capital Costs......................................................................53
5.6. Taxes........................................................................................53
5.7. Payments, Computations, etc..................................................................55
5.8. Sharing of Payments..........................................................................55
5.9. Setoff.......................................................................................56
5.10. Use of Proceeds..............................................................................57
5.11. Change of Lender.............................................................................57
ARTICLE VI CONDITIONS PRECEDENT..................................................................58
6.1. Initial Credit Extension.....................................................................58
6.1.1. Resolutions, etc...................................................................58
6.1.2. Delivery of Notes..................................................................59
6.1.3. Guaranties.........................................................................59
6.1.4. Pledge Agreements..................................................................59
6.1.5. Security Agreement.................................................................59
6.1.6. Amendment to Existing Mortgages....................................................60
6.1.7. Opinions of Counsel................................................................60
6.1.8. UCC Searches.......................................................................60
6.1.9. Evidence of Insurance..............................................................61
6.1.10. Engineering Report.................................................................61
6.1.11. Environmental Report and Questionnaire.............................................61
</TABLE>
<PAGE> 4
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CONTINUED
<TABLE>
<CAPTION>
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<S> <C> <C>
6.1.12. Budget.............................................................................61
6.1.13. Financial Statements...............................................................61
6.1.14. Consents, etc......................................................................61
6.1.15. Shareholder Acknowledgment.........................................................62
6.1.16. Compliance with Representations and Warranties.....................................62
6.1.17. Amended Security Documents, etc....................................................62
6.1.18. Closing Fees, Expenses, etc........................................................62
6.1.19. Other Documents....................................................................62
6.2. Inclusion of Hydrocarbon Interests in the Borrowing Base.....................................62
6.2.1. Environmental Report and Questionnaire.............................................63
6.2.2. Mortgage...........................................................................63
6.2.3. UCC Searches.......................................................................63
6.2.4. Evidence of Insurance..............................................................64
6.2.5. Engineering Reports................................................................64
6.2.6. Material Contracts; Security Agreement.............................................64
6.2.7. Guaranties.........................................................................64
6.2.8. Pledge Agreement...................................................................64
6.2.9. Other Documents....................................................................65
6.3. All Credit Extensions........................................................................65
6.3.1. Compliance with Warranties, No Default, etc........................................65
6.3.2. Credit Request.....................................................................65
6.3.3. Satisfactory Legal Form............................................................66
ARTICLE VII REPRESENTATIONS AND WARRANTIES........................................................66
7.1. Organization, etc............................................................................66
7.2. Due Authorization, Non-Contravention, etc....................................................67
7.3. Government Approval, Regulation, etc.........................................................67
7.4. Investment Company Act.......................................................................67
7.5. Public Utility Holding Company Act...........................................................67
7.6. Validity, etc................................................................................67
7.7. Financial Information........................................................................68
7.8. No Material Adverse Change...................................................................68
7.9. Litigation, Labor Controversies, etc.........................................................68
7.10. Ownership of Properties......................................................................68
7.11. Taxes........................................................................................69
7.12. Pension and Welfare Plans....................................................................69
7.13. Compliance with Law..........................................................................69
7.14. Claims and Liabilities.......................................................................69
</TABLE>
<PAGE> 5
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CONTINUED
<TABLE>
<CAPTION>
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<S> <C> <C>
7.15. No Prohibition on Perfection of Security Documents...........................................69
7.16. Solvency.....................................................................................70
7.17. Environmental Warranties.....................................................................70
7.18. Regulations T, U and X.......................................................................72
7.19. Insurance....................................................................................72
7.20. Year 2000 Compliance.........................................................................72
7.21. Accuracy of Information......................................................................72
ARTICLE VIII COVENANTS.............................................................................73
8.1. Affirmative Covenants........................................................................73
8.1.1. Financial Information, Reports, Notices, etc.......................................73
8.1.2. Compliance with Laws, etc..........................................................76
8.1.3. Maintenance and Development of Properties..........................................77
8.1.4. Insurance..........................................................................77
8.1.5. Books and Records..................................................................78
8.1.6. Environmental Covenant.............................................................78
8.1.7. Further Assurances.................................................................79
8.1.8. Year 2000 Compliance...............................................................80
8.2. Negative Covenants...........................................................................80
8.2.1. Business Activities................................................................80
8.2.2. Indebtedness.......................................................................80
8.2.3. Liens .............................................................................82
8.2.4. Financial Condition................................................................85
8.2.5. Investments........................................................................85
8.2.6. Restricted Payments, etc...........................................................87
8.2.7. Rental Obligations.................................................................87
8.2.8. Consolidation, Merger, etc.........................................................88
8.2.9. Asset Dispositions, etc............................................................88
8.2.10. Modification of Certain Documents..................................................89
8.2.11. Transactions with Affiliates.......................................................89
8.2.12. Negative Pledges, Restrictive Agreements, etc......................................89
8.2.13. Take or Pay Contracts..............................................................90
8.2.14. Sale/Leasebacks....................................................................90
8.2.15. Hydrocarbon Hedging................................................................90
ARTICLE IX EVENTS OF DEFAULT.....................................................................91
9.1. Listing of Events of Default.................................................................91
9.1.1. Non-Payment of Obligations.........................................................91
</TABLE>
<PAGE> 6
TABLE OF CONTENTS
CONTINUED
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
9.1.2. Breach of Warranty.................................................................91
9.1.3. Non-Performance of Certain Covenants and Obligations...............................91
9.1.4. Non-Performance of Other Covenants and Obligations.................................92
9.1.5. Default on Other Indebtedness......................................................92
9.1.6. Judgments..........................................................................92
9.1.7. Pension Plans......................................................................92
9.1.8. Control of the Borrower............................................................93
9.1.9. Bankruptcy, Insolvency, etc........................................................93
9.1.10. Impairment of Security, etc........................................................94
9.1.11. Material Adverse Effect............................................................94
9.1.12. Borrowing Base Deficiency..........................................................94
9.2. Action if Bankruptcy.........................................................................94
9.3. Action if Other Event of Default.............................................................94
9.4. Rights Not Exclusive.........................................................................94
ARTICLE X THE ADMINISTRATIVE AGENT..............................................................95
10.1. Actions......................................................................................95
10.2. Funding Reliance, etc........................................................................95
10.3. Exculpation..................................................................................96
10.4. Successor....................................................................................96
10.5. Loans or Letters of Credit Issued by Bank of America.........................................97
10.6. Credit Decisions.............................................................................97
10.7. Copies, etc..................................................................................97
ARTICLE XI MISCELLANEOUS PROVISIONS..............................................................98
11.1. Waivers, Amendments, etc.....................................................................98
11.2. Notices......................................................................................99
11.3. Payment of Costs and Expenses...............................................................100
11.4. Indemnification.............................................................................100
11.5. Survival....................................................................................101
11.6. Severability................................................................................102
11.7. Headings....................................................................................102
11.8. Execution in Counterparts, Effectiveness, etc...............................................102
11.9. Governing Law; Entire Agreement.............................................................102
11.10. Successors and Assigns......................................................................102
11.11. Sale and Transfer of Loans and Notes; Participations in
Loans and Notes.............................................................................103
11.11.1. Assignments.......................................................................103
</TABLE>
<PAGE> 7
<TABLE>
<S> <C> <C>
11.11.2. Participations....................................................................104
11.12. Forum Selection and Consent to Jurisdiction.................................................105
11.13. Waiver of Jury Trial........................................................................106
11.14. Other Transactions..........................................................................106
11.15. Maximum Interest............................................................................106
11.16. Controlling Document........................................................................108
11.17. Notice......................................................................................109
</TABLE>
<TABLE>
<S> <C>
SCHEDULE I Disclosure Schedule
SCHEDULE II Subsidiaries
SCHEDULE III Administrative Details
SCHEDULE IV Existing Mortgages
SCHEDULE V Existing Hedging Agreements
SCHEDULE VI Updated Title Searches
EXHIBIT A Form of Amended and Restated Secured Promissory Note
EXHIBIT B Form of Security Agreement
EXHIBIT C-1 Form of Borrowing Request
EXHIBIT C-2 Form of Continuation/Conversion Notice
EXHIBIT D Form of Guaranty
EXHIBIT E-1 Form of Mortgage
EXHIBIT E-2 Form of California Mortgage
EXHIBIT F-1 Form of Pledge Agreement (Stock)
EXHIBIT F-2 Form of Pledge Agreement (Partnership Interests)
EXHIBIT G Form of Lender Assignment Notice
EXHIBIT H Form of Opinions of Counsel to the Borrower, et al.
EXHIBIT I-1 Form of Pre-Closing Title Opinions of Special Counsel
to the Borrower
EXHIBIT I-2 Form of Post-Closing Title Opinions of Special Counsel
to the Borrower
EXHIBIT J Form of Issuance Request
</TABLE>
<PAGE> 8
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of
September 30, 1999, among BARGO ENERGY COMPANY, a Texas corporation (the
"Borrower"), the various financial institutions as are now or may hereafter
become parties hereto (collectively, the "Lenders") and BANK OF AMERICA, N.A., a
national banking association, formerly Bank of America National Trust and
Savings Association ("Bank of America"), as administrative agent for the Lenders
(in such capacity, the "Administrative Agent"),
W I T N E S S E T H:
WHEREAS, the Borrower is engaged in the business of oil and gas
exploration and production, and activities related or ancillary thereto; and
WHEREAS, Future Petroleum Corporation, a Utah corporation ("Old FPC"),
and Bank of America are parties to that certain Amended and Restated Credit
Agreement dated as of December 4, 1998 (as amended, the "Existing Credit
Agreement") pursuant to which Bank of America made commitments to make loans to
Old FPC from time to time prior to the applicable commitment termination date in
the maximum aggregate principal amount of loans at any one time not to exceed in
the aggregate the lesser of (x) the collateral value, or (y) $50,000,000; and
WHEREAS, Old FPC has, prior to the Effective Date, merged with and into
the Borrower, such that the Borrower has assumed all of the liabilities and
obligations, and is the owner of all of the assets, of Old FPC pursuant to the
Merger Agreement (hereinafter defined); and
WHEREAS, the Borrower desires to obtain Commitments from the Lenders
and the Issuer pursuant to which
(a) Loans will be made to the Borrower from time to time prior to
the Commitment Termination Date; and
(b) Letters of Credit will be issued by the Issuer for the account
of the Borrower from time to time prior to the Commitment
Termination Date;
in maximum aggregate principal amount of Loans and Letter of Credit Outstandings
at any one time not to exceed in the aggregate the lesser of (x) the Borrowing
Base, or (y) $100,000,000; and
<PAGE> 9
WHEREAS, the Lenders and the Issuer are willing, on the terms and
subject to the conditions hereinafter set forth (including Article VI), to
extend such Commitments, make such Loans to the Borrower and issue and
participate in such Letters of Credit; and
WHEREAS, the parties have agreed that it is in their respective best
interests to enter into this Agreement amending, restating and superseding the
Existing Credit Agreement; and
WHEREAS, the proceeds of such Loans will be used
(a) to refinance all Indebtedness under the Existing
Credit Agreement; and
(b) for Capital Expenditures, working capital and general
corporate purposes of the Borrower and its Material
Subsidiaries.
NOW, THEREFORE, the parties hereto agree to amend and restate the
Existing Credit Agreement in its entirety as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. DEFINED TERMS. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Administrative Agent" is defined in the preamble and includes each
other Person as shall have subsequently been appointed as the successor
Administrative Agent pursuant to Section 10.4.
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors or
managing general partners; or
-2-
<PAGE> 10
(b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"Agreement" means, on any date, this Second Amended and Restated Credit
Agreement as originally in effect on the Effective Date and as thereafter from
time to time amended, supplemented, amended and restated, or otherwise modified
and in effect on such date.
"Alternate Base Rate" means, on any date and with respect to all Base
Rate Loans, a fluctuating rate of interest per annum equal to the higher of
(a) the rate of interest as announced from time to time by the
Administrative Agent as its "prime rate" at its Domestic Office; or
(b) the Federal Funds Effective Rate most recently determined
by the Administrative Agent plus 1/2%.
The Alternate Base Rate is not necessarily intended to be the lowest rate of
interest in connection with extensions of credit. Changes in the rate of
interest on that portion of any Loans maintained as Base Rate Loans will take
effect simultaneously with each change in the Alternate Base Rate. The
Administrative Agent will give notice to the Borrower and the Lenders of changes
in the Alternate Base Rate.
"Applicable Law" means with respect to any Person or matter, any
federal, state, regional, tribal or local statute, law, code, rule, treaty,
convention, application, order, decree, consent decree, injunction, directive,
determination or other requirement (whether or not having the force of law)
relating to such Person or matter and, where applicable, any interpretation
thereof by a Government Agency having jurisdiction with respect thereto or
charged with the administration or interpretation thereof.
"Applicable Margin" means, with respect to any Credit Extension of any
type and at any time of determination, a margin above the interest rate or fee
applicable to such type of Credit Extension determined by reference to the
utilization of the Borrowing Base, as follows:
-3-
<PAGE> 11
<TABLE>
<CAPTION>
Percentage of Alternate
Borrowing Base Utilized Commitment Fee LIBO Rate Margin Base Rate Margin
----------------------- -------------- ---------------- ----------------
<S> <C> <C> <C>
Less than 40% 0.30% 1.50% 0.50%
40% or more, but
less than 80% 0.40% 1.75% 0.75%
Equal to or greater than 80% 0.50% 2.00% 1.00%
</TABLE>
Changes in the Applicable Margin with respect to any Credit Extension and
Commitment Fee shall take effect, as applicable, upon the effective date of each
Borrowing Base Redetermination and immediately upon any Credit Extension.
"Utilization" and "utilized" means, at any time, the percentage obtained by
dividing (i) the sum of all outstanding Loans plus Letter of Credit Outstandings
by (ii) the Borrowing Base.
Notwithstanding the foregoing, as required by Section 3.2.2(z) and without
duplication, after any Borrowing Base Deficiency has existed for more than
ninety (90) consecutive days, each LIBO Rate Margin and Alternate Base Rate
Margin shall be the rate set forth above plus 3.00% per annum until such
Borrowing Base Deficiency has been eliminated.
"Approval" means each and every approval, authorization, license,
permit, consent, variance, land use entitlement, franchise, agreement, filing or
registration by or with any Government Agency or other Person necessary for all
stages of developing, operating, maintaining and abandoning Oil and Gas
Properties.
"Arco East Texas Property" means those Oil and Gas Properties acquired
by a Subsidiary of the Company from Atlantic Richfield Company pursuant to that
certain Purchase and Sale Agreement dated August 3, 1999, effective October 1,
1999.
"Arco Title Indemnity" means that certain Title Indemnity Agreement
dated as of September 8, 1999, between Atlantic Richfield Company and Future
Acquisition 1995, Ltd., pursuant to which Atlantic Richfield Company indemnifies
and holds harmless Future Acquisition 1995, Ltd. and other parties described
therein from and against losses and claims arising from the "Marshall Title
Defect" and the "Marshall Judgment" (as such terms are defined therein) which
may burden the Arco East Texas Property.
-4-
<PAGE> 12
"Assignee Lender" is defined in Section 11.11.1.
"Authorized Officer" means, relative to any Obligor, those of its
officers whose signatures and incumbency shall have been certified to the
Administrative Agent and the Lenders pursuant to Section 6.1.1.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"Bank of America" means Bank of America, N.A., formerly Bank of America
National Trust and Savings Association.
"Borrower" is defined in the preamble.
"Borrowing" means the Loans of the same type and, in the case of LIBO
Rate Loans, having the same Interest Period, made by all Lenders on the same
Business Day and pursuant to the same Borrowing Request in accordance with
Section 2.3.
"Borrowing Base" shall mean, as at any date, (a) prior to the initial
Borrowing Base Redetermination, $40,000,000, (b) prior to the initial Borrowing
Base Redetermination, but after the satisfaction of the conditions precedent set
forth in Section 6.2 pertaining to the Arco East Texas Property and upon its
inclusion in the Borrowing Base, $55,000,000, and (c) thereafter, the amount
determined from time to time pursuant to Section 2.7.
"Borrowing Base Deficiency" means at any time the amount by which (a)
the sum of the aggregate outstanding principal amount of all Loans plus Letter
of Credit Outstandings exceeds (b) the then current Borrowing Base.
"Borrowing Base Deficiency Notification Date" shall mean the date on
which any notice of a Borrowing Base Deficiency is received by the Borrower.
"Borrowing Base Determination Date" is defined in Section 2.7(c).
"Borrowing Base Redetermination" shall mean a Scheduled Redetermination
or a Requested Redetermination, as the case may be.
"Borrowing Request" means a loan request and certificate duly executed
by an Authorized Officer of the Borrower, substantially in the form of Exhibit
C-1 hereto.
"Business Day" means (a) any day which is neither a Saturday or Sunday
nor a legal holiday on which banks are authorized or required to be closed in
Dallas, Texas; and (b) relative to the making, continuing, prepaying or repaying
of any LIBO Rate Loans, any day on which dealings in Dollars are carried on in
the London interbank market.
-5-
<PAGE> 13
"Capital Expenditures" means, for any period, the sum of (without
duplication) (a) all expenditures of the Borrower and its consolidated
Subsidiaries for fixed or capital assets made during such period which, in
accordance with GAAP, would be classified as capital expenditures; and (b) the
aggregate amount of all Capitalized Lease Liabilities incurred during such
period.
"Capital Stock" means any and all shares, interests, participations or
other equivalents in the equity interest (however designated) in such Person and
any rights (other than debt securities convertible into an equity interest),
warrants or options to subscribe for or to acquire interest in such Person.
"Capitalized Lease Liabilities" means all monetary obligations of the
Borrower or any of its consolidated Subsidiaries under any leasing or similar
arrangement which, in accordance with GAAP, would be classified as capitalized
leases, and, for purposes of this Agreement and each other Loan Document, the
amount of such obligations shall be the capitalized amount thereof, determined
in accordance with GAAP.
"Cash Equivalent Investment" means, at any time:
(a) any evidence of Indebtedness, maturing not more than one
(1) year after such time, issued or guaranteed by the United States
Government;
(b) commercial paper, maturing not more than nine (9) months
from the date of issue, which is issued by
(i) a corporation (other than an Affiliate of the
Borrower) organized under the laws of any state of the United
States or of the District of Columbia and rated at least A-1
by Standard & Poor's Corporation or P-1 by Moody's Investors
Service, Inc., or
(ii) a Lender which is rated at least A-1 by Standard
& Poor's Corporation or P-1 by Moody's Investors Service,
Inc.;
(c) any certificate of deposit or bankers acceptance, maturing
not more than one (1) year after such time, which is issued by
(i) a commercial banking institution that is
organized under the laws of the United States, or any state
thereof, or that is organized under the laws of any other
country which is a member of the Organization for Economic
Development, or a political subdivision of any such country,
and has a combined capital and surplus and undivided profits
of not less than $500,000,000, or
-6-
<PAGE> 14
(ii) a Lender which is rated at least A-1 by Standard
& Poor's Corporation or P-1 by Moody's Investors Service,
Inc.; or
(d) any repurchase agreement entered into with any Lender (or
other commercial banking institution of the stature referred to in
clause (c)) which
(i) is secured by a fully perfected security interest
in any obligation of the type described in any of clauses (a)
through (c); and
(ii) has a market value at the time such repurchase
agreement is entered into of not less than 100% of the
repurchase obligation of such Lender (or other commercial
banking institution) thereunder.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change of Control" means, with respect to the Borrower, the occurrence
of:
(a) At such time as any Person or "group" (within the meaning
of Section 13(d)(3) of the Exchange Act), (other than the Principal
Shareholders), is or becomes the beneficial owner, directly or
indirectly, of outstanding shares of the Capital Stock of the Borrower
entitling such Person or Persons to exercise 50% or more of the total
votes entitled to be cast at a regular or special meeting, or by action
by written consent, of the stockholders of the Borrower in the election
of directors (the term "beneficial owner" shall be determined in
accordance with Rule 13d-3 of the Exchange Act);
(b) At such time as the Borrower shall have consummated a
reorganization, merger or consolidation or similar transaction, in each
case, with respect to which all or substantially all the Principal
Shareholders who were beneficial owners of the outstanding shares of
Capital Stock of the Borrower immediately prior to such reorganization,
merger or consolidation, beneficially own, directly or indirectly, less
than 50% of the combined voting power of the then outstanding shares of
Capital Stock of the Borrower resulting from such reorganization,
merger or consolidation; or
(c) Unless otherwise permitted under Section 8.2.8, if the
Borrower ceases to own beneficially and of record 100% of the Capital
Stock of each of Future Texas, Future Nevada and Future California, or
if Future Texas or Future Nevada ceases to own beneficially and of
record 100% of the general
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<PAGE> 15
partner and limited partner interests, respectively, in the Partnership
Subsidiaries;
provided that, the following shall not be deemed a Change of Control:
(a) the acquisition or beneficial ownership of voting securities by the Initial
Holders, any Principal Shareholder Affiliate, or any group of which an Initial
Holder or its respective Principal Shareholder Affiliates is a member; (b) any
repurchase of voting securities by the Borrower or any Subsidiary of the
Borrower; (c) any transaction that causes a Person to become the beneficial
owner of voting securities of the Borrower as a result of acquiring an interest
in an Initial Holder, a Principal Shareholder Affiliate of an Initial Holder or
a transferee of an Initial Holder, or (d) any distribution or dividend to
equity-holders otherwise permitted by this Agreement made by any of the
following entities to their current equity-holders -- BER Partnership L.P.,
formerly known as Bargo Energy Resources, Ltd., a Texas limited partnership; TJG
Investments, Inc., a Texas corporation; BEC Partnership, formerly known as Bargo
Energy Company, a Texas general partnership; and BOC Operating Corporation,
formerly known as Bargo Operating Company, Inc., a Texas corporation.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commission" means the Securities and Exchange Commission or any
similar agency then having jurisdiction to enforce the Securities Act of 1933,
and the rules and regulations of the Commission thereunder and under the
Exchange Act.
"Commitment" means, relative to any Lender, such Lender's obligation
pursuant to Sections 2.1.1 and 2.1.2 to make Loans to the Borrower and to issue
(in the case of an Issuer) or participate in (in the case of all Lenders)
Letters of Credit pursuant to Section 2.1.3.
"Commitment Amount" means the lesser of (i) the Total Commitment, as
reduced from time to time pursuant to the provisions of Section 2.2, or (ii) the
Borrowing Base.
"Commitment Fee" is defined in Section 3.3.3.
"Commitment Availability" means, on any date, the excess of
(a) the then Commitment Amount, over
(b) the sum of
(i) the aggregate outstanding principal amount of all
Loans on such date, plus
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<PAGE> 16
(ii) the Letter of Credit Outstandings on such date.
"Commitment Termination Date" means the earliest of
(a) the Stated Maturity Date;
(b) the date on which the Commitment Amount is terminated in
full or reduced to zero pursuant to Section 2.2; and
(c) the date on which any Commitment Termination Event occurs.
"Commitment Termination Event" means
(a) the occurrence of any Default described in clauses (a)
through (d) of Section 9.1.9 with respect to the Borrower or any
Subsidiary; or
(b) the occurrence and continuance of any other Event of
Default and either
(i) the declaration of the Loans and other
Obligations to be due and payable pursuant to Section 9.3, or
(ii) in the absence of such declaration, the giving
of notice by the Administrative Agent, acting at the direction
of the Required Lenders, to the Borrower that the Commitments
have been terminated.
"Consents" means a Consent to Assignment executed and delivered
pursuant to Section 6.1.15 or Section 6.2.6, in form and substance satisfactory
to the Administrative Agent, pursuant to which the counterparty to each Material
Contract (i) consents to the assignment of each such Material Contract to the
Administrative Agent as security for the Obligations, and (ii) provides the
Administrative Agent an independent right to cure defaults under such Material
Contract.
"Consolidated Net Income" means, with respect to the Borrower and its
consolidated Subsidiaries for any period, the consolidated net income (or loss)
of the Borrower and its consolidated Subsidiaries for such period.
"Contingent Liability" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any
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<PAGE> 17
other Person. The amount of any Person's obligation under any Contingent
Liability shall (subject to any limitation set forth therein) be deemed to be
the outstanding principal amount (or maximum principal amount, if larger) of the
debt, obligation or other liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C-2 hereto.
"Controlled Group" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414(b) or 414(c) of the
Code or Section 4001 of ERISA.
"Credit Extension" means and includes
(a) the advancing of any Loans by the Lenders in connection
with a Borrowing, and
(b) any issuance by an Issuer, or extension of the Stated
Expiry Date by an Issuer, of a Letter of Credit.
"Current Ratio" means, at the end of each Fiscal Quarter, the ratio of
(a) the current assets (including the unused portion of the
Commitment Amount) of the Borrower and its consolidated Subsidiaries
to
(b) the current liabilities (minus the current portion of long
term Debt (including Debt under this Agreement)) of the Borrower and
its consolidated Subsidiaries.
"Debt" means the outstanding principal amount of all Indebtedness of
the Borrower and its consolidated Subsidiaries of the nature referred to in
clauses (a) and (b) of the definition of "Indebtedness".
"Default" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an Event of
Default.
"Disbursement Date" is defined in Section 4.4.
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<PAGE> 18
"Disbursement" means the amount disbursed by the Issuer on a
Disbursement Date.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Administrative Agent and
the Required Lenders.
"Distribution Payments" is defined in Section 8.2.6.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Office" means, relative to any Lender, the office of such
Lender designated as such on Schedule III hereto or designated in a Lender
Assignment Notice or such other office of a Lender (or any successor or assign
of such Lender) within the United States as may be designated from time to time
by notice from such Lender, as the case may be, to each other Person party
hereto.
"EBITDA" means for any period, the sum, without duplication,
(a) Consolidated Net Income for such period, plus
(b) Interest Expense for such period, plus
(c) all depreciation and amortization of assets (including
goodwill and other intangible assets) of the Borrower and its
consolidated Subsidiaries deducted in determining Consolidated Net
Income for such period, plus (minus)
(d) all federal, state, local and foreign income taxes of the
Borrower and its consolidated Subsidiaries deducted (or credits added)
in determining Consolidated Net Income for such period, plus (minus)
(e) other non-cash items deducted or added in determining
Consolidated Net Income for such period, including non-cash write-downs
in connection with ceiling tests as calculated in accordance with GAAP.
"Effective Date" means the date this Agreement becomes effective
pursuant to Section 11.8.
"Eligible Assignee" means a Person which either: (a) is primarily
engaged in the business of commercial banking and is (i) a Lender, (ii) a
Subsidiary of a Lender, (iii) a Subsidiary of a Person of which a Lender is a
Subsidiary, or (iv) a Person of which a Lender is a Subsidiary, or (b) is
consented to as an assignee by the Borrower, the Issuer, and the Administrative
Agent, which consents will not be unreasonably
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<PAGE> 19
withheld, and represents that it is either (i) a commercial bank organized under
the laws of the United States, or any state thereof, having a combined capital
and surplus of at least $500,000,000, or (ii) a commercial bank organized under
the laws of any other country which is a member of the Organization for Economic
Development, or a political subdivision of any such country, having a combined
capital and surplus of at least $100,000,000, provided that such bank is acting
through a branch or agency located in the United States and further provided
that Borrower is not required to pay withholding taxes on interest or principal
owed to such bank based on Applicable Law at the time of the assignment.
Notwithstanding the foregoing, after the occurrence of a Default, any assignment
under clause (b) above shall not require the consent of the Borrower, and after
the occurrence of an Event of Default under Section 9.1.1 or 9.1.9, any
assignment under clause (b) above shall not require the consent of the Borrower
and may be made to a commercial bank or any other Person.
"Engineering Report" means one or more reports, in form and substance
satisfactory to the Administrative Agent and the Required Lenders, prepared at
the sole cost and expense of the Borrower by a petroleum engineer acceptable to
the Administrative Agent in its reasonable business judgment, which shall
evaluate the Proven Reserves and probable reserves attributable to the
Hydrocarbon Interests owned directly by the Borrower and any of its Material
Subsidiaries, as of the immediately preceding January 1 or July 1. Each
Engineering Report shall set forth volumes, a projection of the future rate of
production, present value of the net proceeds of production, estimated costs of
actions described in subsection (a) of the definition of Remedial Action,
operating expenses and Capital Expenditures, in each case based upon updated
economic assumptions (including Hydrocarbon prices, escalation rates, discount
rate assumptions and other general economic assumptions) acceptable to the
Administrative Agent.
"Environmental Laws" means all Applicable Laws, (including consent
decrees and administrative orders) relating to public health and safety through
protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.
"Event of Default" is defined in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, and the rules
and regulations of the Commission thereunder.
"Existing Credit Agreement" is defined in the second recital.
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<PAGE> 20
"Existing Mortgages" means the mortgages and other security instruments
described on Schedule IV hereto.
"Federal Funds Effective Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to
(a) the weighted average of the rates on overnight
federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published for
such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New
York; or
(b) if such rate is not so published for any day
which is a Business Day, the average of the quotations for
such day on such transactions received by the Administrative
Agent from three federal funds brokers of recognized standing
selected by it.
Upon written request from the Borrower, the Lender shall advise the
Borrower as to the details of the method of calculation of Federal Funds
Effective Rate then utilized by the Lender.
"Fee Letter" means that certain letter agreement dated June 4, 1999,
between the Administrative Agent and the Borrower.
"Fiscal Quarter" means any quarter ending on the last day of March,
June, September or December of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g., "Fiscal Year 1999") refer to the Fiscal Year ending
on the December 31 occurring during such calendar year.
"F.R.S. Board" means the Board of Governors of the Federal Reserve
System or any successor thereto.
"Future California" means Future Cal-Tex Corporation, a Texas
corporation, the Subsidiary of the Borrower that owns interests in the South
Coles Levee Unit Property in Kern County, California.
"Future Nevada" means Future Energy Corporation, a Nevada corporation,
the Subsidiary of the Borrower that is the sole limited partner of each of the
Partnership Subsidiaries, and any successor limited partner or limited partners
of any of the Partnership Subsidiaries.
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<PAGE> 21
"Future Texas" means Future Petroleum Corporation, a Texas corporation,
the Subsidiary of the Borrower that is the sole general partner of each of the
Partnership Subsidiaries, and any successor general partner or general partners
of any of the Partnership Subsidiaries.
"GAAP" is defined in Section 1.4.
"Government Agency" means any federal, state, regional, tribal or local
government or governmental department or other entity charged with the
administration, interpretation or enforcement of any Applicable Law.
"Guaranties" means the guaranties of the Obligations, executed and
delivered pursuant to Section 6.1.3, Section 6.2.3 or Section 8.1.7,
substantially in the form of Exhibit D, given by each of the Material
Subsidiaries.
"Hazardous Material" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource
Conservation and Recovery Act, as amended;
(c) any petroleum, crude oil or fraction thereof;
(d) any hazardous, dangerous or toxic chemical, material,
waste or substance within the meaning of any Environmental Law;
(e) any radioactive material, including any naturally
occurring radioactive material, and any source, special or by-product
material as defined in 42 U.S.C. Section 2011 et seq., and any
amendments or reauthorizations thereof;
(f) asbestos-containing materials in any form or condition; or
(g) polychlorinated biphenyls in any form or condition.
"Hedging Agreements" means
(a) interest rate swap agreements, basis swap agreements,
interest rate cap agreements, forward rate agreements, interest rate
floor agreements, and interest rate collar agreements, and all other
agreements or arrangements designed to protect such Person against
fluctuations in interest rates or currency exchange rates, and
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<PAGE> 22
(b) forward contracts, options, futures contracts, futures
options, commodity swaps, commodity options, commodity collars,
commodity caps, commodity floors, and all other agreements or
arrangements designed to protect such Person against fluctuations in
the price of commodities.
"Hedging Obligations" means, with respect to any Person, all
liabilities (including but not limited to obligations and liabilities arising in
connection with or as a result of early or premature termination of a Hedging
Agreement, whether or not occurring as a result of a default thereunder) of such
Person under Hedging Agreements.
"Highest Lawful Rate" is defined in Section 11.15.
"Hydrocarbon Interests" means all rights, titles and interests in and
to oil and gas leases; oil, gas and mineral leases; other Hydrocarbon leases;
mineral interests; mineral servitudes; overriding royalty interests; royalty
interests; net profits interests; production payment interests; and other
similar interests.
"Hydrocarbons" means, collectively, oil, gas, casinghead gas, drip
gasoline, natural gasoline, condensate, distillate and all other liquid or
gaseous hydrocarbons and related minerals and all products therefrom, in each
case whether in a natural or a processed state.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial statement
of the Borrower, any qualification or exception to such opinion or certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of
matters relevant to such financial statement;
(c) which relates to the treatment or classification of any
item in such financial statement and which, as a condition to its
removal, would require an adjustment to such item the effect of which
would be to cause the Borrower to be in default of any of its
obligations under Section 8.2.4; or
(d) which relates to possible errors generated by financial
reporting and related systems due to the Year 2000 Problem.
"including" means including without limiting the generality of any
description preceding such term, and, for purposes of this Agreement and each
other Loan Document, the parties hereto agree that the rule of ejusdem generis
shall not be applicable to limit a general statement, which is followed by or
referable to an
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<PAGE> 23
enumeration of specific matters, to matters similar to the matters specifically
mentioned.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(b) all obligations, contingent or otherwise, relative to the
face amount of all letters of credit, whether or not drawn, and
banker's acceptances issued for the account of such Person;
(c) all other items which, in accordance with GAAP, would be
included as liabilities on the liability side of the balance sheet of
such Person as of the date at which Indebtedness is to be determined;
(d) net liabilities of such Person under all Hedging
Obligations;
(e) whether or not so included as liabilities in accordance
with GAAP, all obligations of such Person to pay the deferred purchase
price of property or services, and indebtedness (excluding prepaid
interest thereon) secured by a Lien on property owned or being
purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited
in recourse;
(f) all monetary obligations of such Person with respect to
Production Payments;
(g) all obligations of such Person as lessee under leases
which have been or should be, in accordance with GAAP, recorded as
Capitalized Lease Liabilities; and
(h) all Contingent Liabilities of such Person.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer, unless such Indebtedness contains
non-recourse provisions acceptable to the Administrative Agent.
"Indemnified Liabilities" is defined in Section 11.4.
"Indemnified Parties" is defined in Section 11.4.
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<PAGE> 24
"Initial Holders" means Energy Capital Investment Company PLC, an
English investment company, EnCap Energy Capital Fund III-B, L.P., a Texas
limited partnership, BOCP Energy Partners, L.P., a Texas limited partnership,
EnCap Energy Capital Fund III, L.P., a Texas limited partnership, Kayne Anderson
Energy Fund, L.P., a Delaware limited partnership, BancAmerica Capital Investors
SBICI, L.P., a Delaware limited partnership, Eos Partners, L.P., a Delaware
limited partnership, Eos Partners SBIC, L.P., a Delaware limited partnership,
Eos Partners SBIC II, L.P., a Delaware limited partnership, and SGC Partners II
LLC, a Delaware limited liability company.
"Interest Coverage Ratio" means, (i) at September 30, 1999, for the
Fiscal Quarter ending on such date, (ii) at December 31, 1999, for the two
consecutive Fiscal Quarters ending on such date, (iii) at March 31, 2000, for
the three consecutive Fiscal Quarters ending on such date, and (iv) at the end
of any Fiscal Quarter commencing with the Fiscal Quarter ending June 30, 2000,
for the four consecutive Fiscal Quarters ending on such date, the ratio of (a)
EBITDA of the Borrower and its consolidated Subsidiaries for such Fiscal
Quarter(s) to (b) Interest Expense for such Fiscal Quarter(s).
"Interest Expense" means, for any period, the consolidated interest
expense of the Borrower and its consolidated Subsidiaries for such period
(including all imputed interest under interest rate swaps constituting Hedging
Agreements and including all capitalized interest, but excluding all fees paid
under Section 3.3), as determined in accordance with GAAP, including that
portion of any Capitalized Lease Liabilities of the Borrower and its
Subsidiaries allocable to interest expense.
"Interest Period" means, relative to any LIBO Rate Loans, the period
beginning on (and including) the date on which such LIBO Rate Loan is made or
continued as, or converted into, a LIBO Rate Loan pursuant to Section 2.3 or 2.4
and ending on (but excluding) the day which numerically corresponds to such date
one, two, three or six months thereafter (or, if such month has no numerically
corresponding day, on the last Business Day of such month), in each case as the
Borrower may select in its relevant notice pursuant to Section 2.3 or 2.4;
provided, however, that
(a) no more than six (6) different Interest Periods may be in
effect at any time;
(b) Interest Periods commencing on the same date for Loans
comprising part of the same Borrowing shall be of the same duration;
(c) if such Interest Period would otherwise end on a day which
is not a Business Day, such Interest Period shall end on the next
following Business Day (unless, if such Interest Period applies to LIBO
Rate Loans, such next following Business Day is the first Business Day
of another calendar month, in
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<PAGE> 25
which case such Interest Period shall end on the Business Day next preceding
such numerically corresponding day);
(d) no Interest Period may end later than the Stated Maturity
Date; and
(e) the Borrower shall select each Interest Period for a
particular LIBO Rate Loan so as not to require (as reasonably
foreseeable as possible) a prepayment of such LIBO Rate Loan during
such Interest Period.
"Investment" means, relative to any Person,
(a) any loan or advance made by such Person to any other
Person (excluding commission, travel and similar advances to officers
and employees made in the ordinary course of business and excluding
prepaid expenses incurred in the ordinary course of business);
(b) any Contingent Liability of such Person; and
(c) any ownership or similar interest held by such Person in
any other Person;
provided, however, that (i) Hedging Obligations and (ii) Production Payments
where the Borrower or its Subsidiary is the grantor or transferor thereof shall
not be considered Investments. The amount of any Investment shall be the
original principal or capital amount thereof less all returns of principal or
equity thereon (and without adjustment by reason of the financial condition of
such other Person) and shall, if made by the transfer or exchange of property
other than cash, be deemed to have been made in an original principal or capital
amount equal to the fair market value of such property.
"Issuance Request" means a request for the issuance of a Letter of
Credit and certificate duly executed by the chief executive, accounting or
financial Authorized Officer of the Borrower, in substantially the form of
Exhibit J attached hereto (with such changes thereto as may be agreed upon from
time to time by the Administrative Agent and the Borrower).
"Issuer" means Bank of America or any affiliate, unit or agency of Bank
of America which has agreed to issue one or more Letters of Credit at the
request of the Administrative Agent (which shall, at the Borrower's request,
notify the Borrower from time to time of the identity of any such Issuer).
"Lender Assignment Notice" means a Lender Assignment Notice
substantially in the form of Exhibit G hereto.
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"Lenders" is defined in the preamble.
"Letter of Credit" is defined in Section 4.1.
"Letter of Credit Availability" means, at any time, the lesser of
(a) the excess of
(i) $5,000,000
minus
(ii) the then Letter of Credit Outstandings,
or
(b) the Commitment Availability at such time.
"Letter of Credit Outstandings" means, at any time, an amount equal to
the sum of
(a) the aggregate Stated Amount at such time of all Letters of
Credit then outstanding and undrawn (as such aggregate Stated Amount
shall be adjusted, from time to time, as a result of drawings, the
issuance of Letters of Credit, or otherwise),
plus
(b) the then aggregate amount of all unpaid and outstanding
Reimbursement Obligations.
"LIBO Office" means, relative to any Lender, the office of such Lender
designated as such on Schedule III hereto or designated in a Lender Assignment
Notice or such other office of a Lender (or any successor or assign of such
Lender) as designated from time to time by notice from such Lender to the
Borrower and the Administrative Agent, whether or not outside the United States,
which shall be making or maintaining LIBO Rate Loans of such Lender hereunder.
"LIBO Rate" means, with respect to each Interest Period for a LIBO Rate
Loan:
(a) the rate of interest per annum (carried out to the fifth
decimal place) equal to the rate determined by the Administrative Agent
to be the offered rate that appears on the page of the Telerate Screen
that displays an average British Bankers Association Interest
Settlement Rate (such page currently being page number 3750) for
deposits in Dollars (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period,
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<PAGE> 27
determined as of approximately 11:00 a.m. (London time) two (2)
Business Days prior to the first day of such Interest Period;
(b) in the event that the rate referenced in the preceding
clause (a) does not appear on such page or service or such page or
service shall cease to be available, the rate of interest per annum
(carried out to the fifth decimal place) equal to the rate determined
by the Administrative Agent to be the offered rate on such other page
or other service that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the
first day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London
time) two (2) Business Days prior to the first day of such Interest
Period; or
(c) in the event that the rates referenced in the preceding
clauses (a) and (b) are not available, the rate of interest per annum
determined by the Administrative Agent as the rate of interest at which
Dollar deposits (for delivery on the first day of such Interest Period)
in same day funds in the approximate amount of the applicable LIBO Rate
Loan and with a term equivalent to such Interest Period would be
offered by its London Branch to major banks in the offshore Dollar
market at their request at approximately 11:00 a.m. (London time) two
(2) Business Days prior to the first day of such Interest Period.
"LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any Interest
Period, a rate per annum (rounded upwards, if necessary, to the nearest 0.01 of
1%) determined pursuant to the following formula:
LIBO Rate
LIBO Rate = -------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate
Loans will be determined by the Administrative Agent on the basis of the LIBOR
Reserve Percentage in effect on, and the applicable rates furnished to and
received by the Administrative Agent, two (2) Business Days before the first day
of such Interest Period.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the LIBO Rate.
"LIBOR Reserve Percentage" means, relative to any Interest Period for
LIBO Rate Loans, the reserve percentage (expressed as a decimal and rounded
upward, if necessary, to the nearest 0.01 of 1%) equal to the maximum aggregate
reserve
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requirements (including all basic, emergency, supplemental, marginal and other
reserves and taking into account any transitional adjustments or other scheduled
changes in reserve requirements) specified under regulations issued from time to
time by the F.R.S. Board and then applicable to assets or liabilities consisting
of and including "Eurocurrency Liabilities," as currently defined in Regulation
D of the F.R.S. Board, having a term approximately equal or comparable to such
Interest Period.
"Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
otherwise), charge against or interest in Property to secure (i) the payment of
a debt or (ii) the performance of an obligation or other priority or
preferential arrangement of any kind or nature whatsoever in respect of any
Property (including those created by, arising under or evidenced by any
conditional sale or other title retention agreement, the interest of a lessor
under a capital lease, any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any financing
statement naming the owner of the asset to which such lien relates as debtor,
under the Uniform Commercial Code or any comparable law) and any contingent or
other agreement to provide any of the foregoing.
"Loans" means the loans provided for by Section 2.1 and shall include
Revolving Credit Loans.
"Loan Document" means this Agreement, the Notes, the Security
Documents, the Letters of Credit, the Fee Letter and all other agreements
(including Hedging Agreements) relating to this Agreement entered into from time
to time between or among the Borrower (or any or all of its Subsidiaries) and
the Administrative Agent or any Lender (or, with respect to the Hedging
Agreements, any Affiliates of any Lender), and any document delivered by the
Borrower or any of its Subsidiaries in connection with the foregoing.
"Material Adverse Effect" means with respect to any matter that such
matter
(a) could reasonably be expected materially and adversely to
affect the assets, business, properties, condition (financial or
otherwise), prospects, or results of operations of the Borrower and its
Subsidiaries taken as a whole, or the value or condition of the
Properties of the Borrower and its Subsidiaries taken as a whole, or
the ability of the Borrower or any other Obligor to perform its
obligations under any of the Loan Documents, or
(b) has been brought by or before any court or arbitrator or
any governmental body, agency or official, and draws into question or
otherwise has or reasonably could be expected to have a material
adverse effect on the validity or enforceability of any material
provision of any Loan Document
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against any Obligor party thereto or the rights, remedies and benefits
available to the Administrative Agent and the Lenders under the Loan
Documents.
"Material Contract" means each acquisition agreement, Hydrocarbon
purchase and sale agreement, or similar contract relating to any Hydrocarbon
Interests included in the Mortgaged Properties or other agreement, in each case
as designated by the Administrative Agent.
"Material Subsidiary" means, at any particular time, any Subsidiary (i)
that has assets included in the Borrowing Base; (ii) that, together with its
Subsidiaries, (a) accounted for more than 5% of the consolidated EBITDA of the
Borrower and its Subsidiaries for the most recently completed Fiscal Quarter
(computed on a retroactive proforma basis with respect to acquired
Subsidiaries), or (b) was the owner of more than 5% of the consolidated assets
of the Borrower and its Subsidiaries at the end of such Fiscal Quarter or, with
respect to acquired or newly formed Subsidiaries, on the date of acquisition or
formation of such acquired Subsidiary, all as shown in the case of (a) and (b)
on the consolidated financial statements of the Borrower and its Subsidiaries
for such Fiscal Quarter or on such acquisition or formation date; or (iii) that
is designated by the Borrower in writing to the Administrative Agent as a
Material Subsidiary.
"Merger Agreement" means the Agreement and Plan of Merger dated as of
April 26, 1999, by and between Future Petroleum Corporation, a Utah corporation,
and FPT Corporation, a Texas corporation.
"Mortgage Consents" means all consents required under existing oil and
gas leases or other agreements and Approvals by Government Agencies to the
granting of a Mortgage to the Administrative Agent, and as reasonably determined
by the Administrative Agent with respect to Properties that become Mortgaged
Properties after the Effective Date.
"Mortgaged Properties" means the Hydrocarbon Interests, Properties and
interests described in and secured by the Mortgages, as such Properties and
interests are from time to time constituted.
"Mortgages" means the Mortgage, Deed of Trust, Assignment, Security
Agreement, Financing Statement and Fixture Filings executed and delivered
pursuant to Section 6.2.2 or Section 8.1.7, substantially in the form of Exhibit
E hereto, as amended, supplemented, restated or otherwise modified from time to
time, and includes the Existing Mortgages and the New Mortgages.
"New Mortgages" means Mortgages granted by the Borrower and its
Subsidiaries encumbering the Hydrocarbon Interests and Properties of the
Borrower
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and its Subsidiaries which did not secure the obligations under the Existing
Credit Agreement.
"Non-Redeemable Stock" means stock issued by the Borrower, provided
that such stock is not considered debt for GAAP, tax law or any other purpose
and provided further that neither the Borrower nor any of its Subsidiaries has
any obligation to redeem or purchase or pay dividends on such stock or to
exchange such stock for, or convert such stock to, any other security (other
than "Non-Redeemable Common Stock"), whether such obligation arises pursuant to
the terms of such stock or any other agreement relating thereto or otherwise and
whether or not such obligation exists in all circumstances or only upon the
occurrence of a particular event or condition or upon the passage of time or
otherwise. "Non-Redeemable Common Stock" means Non-Redeemable Stock that is
common stock issued by the Borrower.
"Note" means the promissory note of the Borrower payable to the order
of a Lender, in the form of Exhibit A hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from outstanding
Loans, and also means all other promissory notes accepted from time to time in
substitution therefor or renewal thereof.
"Obligations" means all obligations (monetary or otherwise) of the
Borrower and/or each other Obligor arising under or in connection with this
Agreement, the Notes and each other Loan Document, including without limitation,
all Hedging Obligations arising under Hedging Agreements between the Borrower or
any of its Subsidiaries and a Lender or any Affiliate of a Lender.
"Obligor" means the Borrower, any of its Subsidiaries, or any other
Person (other than the Administrative Agent or a Lender) obligated under or
otherwise a party to any Loan Document.
"Oil and Gas Properties" means Hydrocarbon Interests; the Properties
now or hereafter pooled or unitized with Hydrocarbon Interests; all presently
existing or future unitization, pooling agreements and declarations of pooled
units and the units created thereby (including without limitation all units
created under orders, regulations and rules of any Government Agency having
jurisdiction) which may affect all or any portion of the Hydrocarbon Interests;
all operating agreements, joint venture agreements, contracts and other
agreements which relate to any of the Hydrocarbon Interests or the production,
sale, purchase, exchange or processing of Hydrocarbons from or attributable to
such Hydrocarbon Interests; all Hydrocarbons in and under and which may be
produced and saved or attributable to the Hydrocarbon Interests, the lands
covered thereby and all oil in tanks and all rents, issues, profits, proceeds,
products, revenues and other incomes from or attributable to the Hydrocarbon
Interests; all tenements, profits a prendre, hereditaments, appurtenances and
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Properties in anywise appertaining, belonging, affixed or incidental to the
Hydrocarbon Interests, Properties, rights, titles, interests and estates
described or referred to above, including any and all Property, real or
personal, now owned or hereinafter acquired and situated upon, used, held for
use or useful in connection with the operating, working or development of any of
such Hydrocarbon Interests or Property (excluding drilling rigs, automotive
equipment or other personal property which may be on such premises for the
purpose of drilling a well or for other similar temporary uses) and including
any and all oil wells, gas wells, water wells, injection wells or other wells,
buildings, structures, fuel separators, liquid extraction plants, plant
compressors, pumps, pumping units, field gathering systems, tanks and tank
batteries, fixtures, valves, fittings, machinery and parts, engines, boilers,
meters, apparatus, equipment, appliances, tools, implements, cables, wires,
towers, casing, tubing and rods, surface leases, rights-of-way, easements and
servitudes together with all additions, substitutions, replacements, accessions
and attachments to any and all of the foregoing.
"Old FPC" is defined in the second recital.
"Organic Document" means, relative to any corporate Obligor, its
certificate of incorporation, its by-laws and all shareholder agreements, voting
trusts and similar arrangements applicable to any of its authorized shares of
Capital Stock, and, relative to any partnership Obligor, its partnership
agreement.
"Participant" is defined in Section 11.11.2.
"Partners" means the general and limited partners of the Partnership
Subsidiaries, being Future Texas as the general partner, and Future Nevada as
the limited partner, and any successor general partner or limited partner of any
Partnership Subsidiary.
"Partnership Subsidiary" means any direct or indirect Subsidiary of the
Borrower that is a limited partnership, including Future Acquisition 1995, Ltd.,
a Texas limited partnership, BMC Development No. 1 Limited Partnership, a Texas
limited partnership and NCI Shawnee Limited Partnership, a Texas limited
partnership.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multiemployer plan as defined in section 4001(a)(3) of ERISA), and to which the
Borrower or any corporation, trade or business that is, along with the Borrower,
a member of a Controlled Group, may have liability, including any liability by
reason of having been a substantial employer within the meaning of section 4063
of ERISA at any time
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during the preceding five years, or by reason of being deemed to be a
contributing sponsor under section 4069 of ERISA.
"Percentage" means, relative to any Lender, the percentage set forth on
Schedule III hereto, as such percentage may be adjusted from time to time
pursuant to Lender Assignment Notice(s) executed by such Lender and its Assignee
Lender(s) and delivered pursuant to Section 11.11.
"Person" means any natural person, corporation, partnership, limited
liability company, firm, association, trust, Government Agency or any other
entity, whether acting in an individual, fiduciary or other capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Pledge Agreements" means the Pledge Agreements executed and delivered
pursuant to Section 6.1.4, Section 6.2.8 or Section 8.1.7, substantially in the
form of Exhibit F-1 (from the Borrower) or F-2 (from each of the Partners)
hereto, as applicable, as amended, supplemented, restated or otherwise modified
from time to time.
"Principal Shareholders" means each of the Initial Holders, Thomas D.
Barrow and Tim J. Goff.
"Principal Shareholder Affiliate" means any Person which, directly or
indirectly, controls, is controlled by or is under common control with a
Principal Shareholder (excluding any trustee under, or any committee with
responsibility for administering, any Plan). A Person shall be deemed to be
"controlled by" any other Person if such other Person possesses, directly or
indirectly, power
(a) to vote 50% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors or
managing general partners; or
(b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"Proceeds Account" is defined in Section 3.4.
"Production Payments" means the grant or transfer to any Person of a
production payment (whether volumetric or dollar denominated) or similar
royalty, overriding royalty, net profits interest or other similar interest in
Oil and Gas Properties, or the right to receive all or a portion of the
production or the proceeds from the sale of production attributable to such Oil
and Gas Properties where the holder of such interest has recourse solely to such
interest and the grantor or transferor thereof has
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an express contractual obligation to produce and sell Hydrocarbons from such Oil
and Gas Properties, or to cause such Oil and Gas Properties to be so operated
and maintained, in each case in a reasonably prudent manner.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Proven Reserves" means collectively, "proved oil and gas reserves,"
"proved developed producing oil and gas reserves," "proved developed
non-producing oil and gas reserves" (consisting of proved developed shut-in oil
and gas reserves and proved developed behind pipe oil and gas reserves), and
"proved undeveloped oil and gas reserves," as such terms are defined by the U.S.
Securities and Exchange Commission in its standards and guidelines.
"Quarterly Payment Date" means, commencing December 31, 1999, the last
Business Day of each March, June, September and December.
"Reimbursement Obligation" is defined in Section 4.5.
"Release" means a "release," as such term is defined in CERCLA.
"Remedial Action" means any action under Environmental Laws required to
(a) clean up, remove, treat, dispose of, abate, or in any other way address
pollutants (including Hazardous Materials) in the environment, (b) prevent the
Release or threat of a Release or minimize the further Release of pollutants, or
(c) investigate and determine if a remedial response is needed and to design
such a response and any post-remedial investigation, monitoring, operation, and
maintenance and care.
"Requested Redetermination" is defined in Section 2.7.
"Required Lenders" means, at any time, Lenders holding, in the
aggregate, at least 66-2/3% of the then outstanding principal amount of all
Loans or, if no such principal amount is outstanding, Lenders having Percentages
aggregating at least 66-2/3% of the Total Commitment.
"Resource Conservation and Recovery Act" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect
from time to time.
"Restricted Payment Tests" means compliance with each of the following
restrictions (both before and immediately after giving effect to the applicable
Distribution Payment):
(a) Tangible Net Worth shall not be less than the sum of (i)
$44,574,521 plus (ii) fifty percent (50%) of consolidated net income of
the
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Borrower and its Subsidiaries (excluding the effects of consolidated
net losses), for each Fiscal Quarter beginning on or after July 1,
1999, plus (iii) one-hundred percent (100%) of the net proceeds of any
Non-Redeemable Stock offering by the Borrower or any of its
Subsidiaries at any time after the Effective Date;
(b) the Current Ratio shall be not less than 1.0:1.0;
(c) the Interest Coverage Ratio shall be not less than
3.0:1.0;
(d) there shall exist no Borrowing Base Deficiency;
(e) no Default shall have occurred and be continuing; and
(f) the Lenders shall have consented in writing to such
Distribution Payment with respect to the Series B
Preferred.
"Revolving Credit Loans" means the loans provided for by Section 2.1.
"Scheduled Redetermination" is defined in Section 2.7.
"Security Agreement" means the Amended and Restated Security Agreement
executed and delivered pursuant to Section 6.1.5, Section 6.2.6 or Section 8.1.7
substantially in the form of Exhibit B, as amended, supplemented, restated or
otherwise modified from time to time pursuant to which the Borrower or its
Subsidiaries, as the case may be, pledges to the Administrative Agent as
security for the Obligations the Material Contracts and the Borrower's or its
Subsidiaries', as the case may be, bank accounts and intercompany accounts and
loans receivable.
"Security Documents" means, collectively, (a) the Guaranties, (b) the
Pledge Agreements, (c) the Mortgages, (d) the Security Agreements, (e) the
Consents and (f) the Mortgage Consents, together with any exhibits, schedules
and other attachments to such documents and any financing statements related
thereto, as such documents, exhibits, schedules, attachments or financing
statements may be, from time to time, amended, supplemented, restated or
otherwise modified.
"Series B Preferred" means that portion of the Capital Stock of the
Borrower known as the "Cumulative Redeemable Preferred Stock, Series B" issued
by the Borrower to the Initial Holders pursuant to the Stock Purchase Agreement.
"Shareholders' Agreement" means the Second Amended and Restated
Shareholders' Agreement dated as of May 14, 1999, among the Borrower, B. Carl
Price, a Texas resident, Don Wm. Reynolds, a Texas resident, Energy Capital
Investment Company PLC, an English investment company, EnCap Equity 1994 Limited
Partnership, a Texas limited partnership, Bargo Energy Resources, Ltd., a
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Texas limited partnership, TJG Investments, Inc., a Texas corporation, Bargo
Energy Company, a Texas general partnership, Tim J. Goff, Thomas Barrow, James
E. Sowell, Bargo Operating Company, Inc., a Texas corporation, EnCap Energy
Capital Fund III-B, L.P., a Texas limited partnership, BOCP Energy Partners,
L.P., a Texas limited partnership, EnCap Energy Capital Fund III, L.P., a Texas
limited partnership, Kayne Anderson Energy Fund, L.P., a Delaware limited
partnership, Banc America Capital Investors SBIC I, L.P., a Delaware limited
partnership, Eos Partners, L.P., a Delaware limited partnership, Eos Partners
SBIC, L.P., a Delaware limited partnership, Eos Partners SBIC II, L.P., a
Delaware limited partnership, and SGC Capital Partners II LLC, a Delaware
limited liability company, as the same may be, from time to time, amended,
supplemented, restated or otherwise modified.
"Stated Amount" of each Letter of Credit means the face amount or the
"Stated Amount" of such Letter of Credit (as defined therein).
"Stated Expiry Date" is defined in Section 4.1.
"Stated Maturity Date" means September 30, 2002.
"Stock Purchase Agreement" means the Stock Purchase Agreement dated as
of May 14, 1999, among the Borrower and Energy Capital Investment Company PLC,
an English investment company, EnCap Energy Capital Fund III-B, L.P., a Texas
limited partnership, BOCP Energy Partners, L.P., a Texas limited partnership,
EnCap Energy Capital Fund III, L.P., a Texas limited partnership, Kayne Anderson
Energy Fund, L.P., a Delaware limited partnership, BancAmerica Capital Investors
SBIC I, L.P., a Delaware limited partnership, Eos Partners, L.P., a Delaware
limited partnership, Eos Partners SBIC, L.P., a Delaware limited partnership,
Eos Partners SBIC II, L.P., a Delaware limited partnership, and SGC Partners II
LLC, a Delaware limited liability company as the same may be, from time to time,
amended, supplemented, restated or otherwise modified.
"Subsidiary" means, with respect to any Person, (a) any corporation of
which more than 50% of the outstanding Capital Stock having ordinary voting
power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time Capital Stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, (b) any
partnership, limited liability company, association or firm of which more than
50% of the equity interest or voting power is at the time directly or indirectly
owned by such Person, by such Person and one or more other Subsidiaries of such
Person, or by one or more other Subsidiaries of such Person or (c) any
partnership in which such Person is a general partner; provided that
associations, joint ventures or other relationships (i) which are established
pursuant to a standard form AAPL Form 610 operating agreement or similar
agreement and which are partnerships for purposes of income taxation only, (ii)
which are not
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corporations, trusts, limited liability companies or partnerships (or subject to
the Uniform Partnership Act) under applicable state law, and (iii) whose
businesses are limited to the exploration, development and operation of oil, gas
or mineral properties and interests owned directly by the parties in such
associations, joint ventures or relationships, shall not be deemed to be
"Subsidiaries" of such Person.
"Surety Instruments" means all letters of credit (including standby and
commercial), banker's acceptances, bank guaranties, shipside bonds, surety bonds
and similar instruments.
"Tangible Net Worth" means the consolidated net worth of the Borrower
and its Subsidiaries (including therein the net amount received by the Borrower
in respect of the issuance of the Series B Preferred) after subtracting
therefrom the aggregate amount of any intangible assets of the Borrower and its
Subsidiaries, including goodwill, franchises, licenses, patents, trademarks,
trade names, copyrights, service marks and brand names.
"Taxes" is defined in Section 5.6.
"Total Commitment" means $100,000,000.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
"United States" or "U.S." means the United States of America, its fifty
States and the District of Columbia.
"Unsecured Indemnity" means that certain Amended and Restated Hazardous
Materials Undertaking and Unsecured Indemnity dated as of September 30, 1999,
from Future California, in favor of the Administrative Agent, as amended.
"Welfare Plan" means a "welfare plan", as such term is defined in
section 3(1) of ERISA.
"Year 2000 Compliant" is defined in Section 7.20.
"Year 2000 Problem" is defined in Section 7.20.
SECTION 1.2. USE OF DEFINED TERMS. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and in
each Note, Borrowing Request, Continuation/Conversion Notice, notice and other
communication or other Loan Document delivered from time to time in connection
with this Agreement or any other Loan Document.
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SECTION 1.3. CROSS-REFERENCES. Unless otherwise specified, references
in this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.
(a) The meanings of defined terms are equally applicable to
the singular and plural forms of the defined terms.
(b) The words "hereof," "herein," "hereunder" and similar
words refer to this Agreement as a whole and not to any particular
provision of this Agreement; and subsection, Section, Schedule and
Exhibit references are to this Agreement or such other Loan Document,
as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such
clause of such Article, Section or definition.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from
and including"; the words "to" and "until" each mean "to but
excluding," and the word "through" means "to and including."
(iii) The term "property" includes any kind of
property or asset, real, personal or mixed, tangible or intangible.
(d) Unless otherwise expressly provided herein, (i) references
to agreements (including this Agreement) and other contractual
instruments shall be deemed to include all subsequent amendments and
other modifications thereto, but only to the extent such amendments and
other modifications are not prohibited by the terms of any Loan
Document, and (ii) references to any statute or regulation are to be
construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the
statute or regulation.
(e) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are
cumulative and shall each be performed in accordance with their terms.
Unless otherwise expressly provided, any reference to any action of the
Administrative Agent or the
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Lenders by way of consent, approval or waiver shall be deemed modified
by the phrase "in its sole discretion" or "in their sole discretion,"
as applicable.
(f) This Agreement and the other Loan Documents are the result
of negotiations among and have been reviewed by counsel to the Lenders,
the Borrower and the other parties, and are the products of all
parties. Accordingly, they shall not be construed against the Lenders
merely because of the Lenders' involvement in their preparation.
SECTION 1.4. ACCOUNTING AND FINANCIAL DETERMINATIONS. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder (including under Section 8.2.4) shall be made, and all financial
statements required to be delivered hereunder or thereunder shall be prepared in
accordance with, those generally accepted accounting principles ("GAAP") applied
in the preparation of the financial statements referred to in Section 7.7.
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTE
SECTION 2.1. COMMITMENTS.
SECTION 2.1.1. REVOLVING CREDIT LOANS. On the terms and subject to the
conditions of this Agreement (including Article VI), each Lender severally
agrees to make loans (relative to such Lender, its "Revolving Credit Loans") to
the Borrower equal to such Lender's Percentage of the aggregate amount of the
Borrowing of Revolving Credit Loans requested by the Borrower to be made on such
day described in this Section 2.1.1. On the terms and subject to the conditions
hereof, the Borrower may from time to time borrow, prepay and reborrow Revolving
Credit Loans. From time to time on any Business Day during the period from and
after the Effective Date to but not including the Commitment Termination Date,
each Lender will make Revolving Credit Loans to the Borrower equal to such
Lender's Percentage of the amount of the Revolving Credit Loans requested by the
Borrower to be made on such day in the applicable Borrowing Request therefor.
The Borrower acknowledges that, as of the Effective Date, the aggregate
outstanding amount of all loans under the Existing Credit Agreement is
$19,605,000.00. On the Effective Date, each of the Lenders other than Bank of
America shall be deemed to have purchased from Bank of America such Lender's
Percentage share of the outstanding principal amount of such loans and shall pay
to Bank of America an amount equal to the product of its Percentage multiplied
by $19,605,000.00.
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SECTION 2.1.2. LETTERS OF CREDIT. From time to time on any Business
Day prior to the Commitment Termination Date, each Issuer will issue, and each
Lender severally will participate in, the Letters of Credit, in accordance with
Article IV.
SECTION 2.1.3. LENDERS NOT REQUIRED TO MAKE LOANS UNDER CERTAIN
CIRCUMSTANCES. No Lender shall be permitted or required to
(a) make any Loan if, after giving effect thereto
(i) the aggregate outstanding principal amount of all
Loans of all Lenders, together with all the Letter of Credit
Outstandings, would exceed the Commitment Amount; or
(ii) the aggregate outstanding principal amount of
all Loans of such Lender, together with its Percentage of all
Letter of Credit Outstandings, would exceed such Lender's
Percentage of the Commitment Amount; or
(iii) a Borrowing Base Deficiency would exist; or
(b) issue (in the case of any Issuer) or participate in (in
the case of any Lender) any Letter of Credit if, after giving effect
thereto
(i) all Letter of Credit Outstandings together with
the aggregate outstanding principal amount of all Loans of all
Lenders would exceed the Commitment Amount; or
(ii) such Lender's Percentage of all Letter of Credit
Outstandings together with the aggregate outstanding principal
amount of all Loans of such Lender would exceed such Lender's
Percentage of the Commitment Amount; or
(iii) a Borrowing Base Deficiency would exist; or
(iv) all Letter of Credit Outstandings would exceed
$5,000,000.
SECTION 2.2. REDUCTION OF COMMITMENT AMOUNT. The Commitment Amount is
subject to reduction from time to time pursuant to this Section 2.2.
SECTION 2.2.1. OPTIONAL. The Borrower may, from time to time on any
Business Day, voluntarily reduce the Total Commitment; provided, however, that
all such reductions shall require at least three (3) Business Days' prior notice
to the Administrative Agent and be permanent, and any partial reduction of the
Commitment
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Amount shall be in a minimum amount of $5,000,000 and in an integral multiple of
$1,000,000.
SECTION 2.2.2. MANDATORY. On any Commitment Termination Date, the
Commitment Amount shall, without any further action, automatically and
permanently be reduced to zero.
SECTION 2.3. BORROWING PROCEDURE. By delivering a Borrowing Request to
the Administrative Agent on or before 10:00 a.m. (Dallas time) on a Business
Day, the Borrower may from time to time irrevocably request, on (i) such
Business Day, in the case of Base Rate Loans and (ii) not less than three (3)
nor more than five (5) Business Days' notice in the case of LIBO Rate Loans,
that a Borrowing be made in a minimum amount of $1,000,000 and an integral
multiple of $500,000, or in the unused amount of the Commitment Amount. On the
terms and subject to the conditions of this Agreement, each Borrowing shall be
comprised of the type of Loans and shall be made on the Business Day specified
in such Borrowing Request. On or before 1:00 p.m. (Dallas time) on such Business
Day each Lender shall deposit with the Administrative Agent same day funds in an
amount equal to such Lender's Percentage of the requested Borrowing. Such
deposit will be made to an account which the Administrative Agent shall specify
from time to time by notice to the Lenders. To the extent funds are received
from the Lenders, the Administrative Agent shall make such funds available to
the Borrower by wire transfer to the accounts the Borrower shall have specified
in its Borrowing Request. No Lender's obligation to make any Loan shall be
affected by any other Lender's failure to make any Loan.
SECTION 2.4. CONTINUATION AND CONVERSION ELECTIONS. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before 10:00
a.m. (Dallas time) on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than three (3) nor more than five (5) Business
Days' notice that all, or any portion in an aggregate minimum amount of
$1,000,000 and an integral multiple of $500,000, of any Loans be, in the case of
Base Rate Loans, converted into LIBO Rate Loans or, in the case of LIBO Rate
Loans, be converted into a Base Rate Loan or continued as a LIBO Rate Loan (in
the absence of delivery of a Continuation/Conversion Notice with respect to any
LIBO Rate Loan at least three (3) Business Days before the last day of the then
current Interest Period with respect thereto, such LIBO Rate Loan shall, on such
last day, automatically convert to a Base Rate Loan); provided, however, that
(a) each such conversion or continuation shall be pro rated among the applicable
outstanding Loans of all Lenders, and (b) no portion of the outstanding
principal amount of any Loan may be continued as, or be converted into, LIBO
Rate Loans when any Default has occurred and is continuing.
SECTION 2.5. FUNDING. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing one
of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to
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make or maintain such LIBO Rate Loan; provided, however, that such LIBO Rate
Loan shall nonetheless be deemed to have been made and to be held by such
Lender, and the obligation of the Borrower to repay such LIBO Rate Loan shall
nevertheless be to such Lender for the account of such foreign branch, Affiliate
or international banking facility. In addition, the Borrower hereby consents and
agrees that, for purposes of any determination to be made for purposes of
Section 5.1, 5.2, 5.3 or 5.4, it shall be conclusively assumed that each Lender
elected to fund all LIBO Rate Loans by purchasing Dollar deposits in its LIBO
Office's interbank Eurodollar market.
SECTION 2.6. LOAN ACCOUNTS AND NOTES.
(a) The Loans made by the Lenders shall be evidenced by one or
more loan accounts or records maintained by each Lender in the ordinary
course of business. The loan accounts or records maintained by such
Lender shall be rebuttable presumptive evidence of the amount of the
Loans made by such Lender to the Borrower and the interest and payments
thereon. Any failure so to record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Borrower
hereunder to pay any amount owing with respect to the Loans.
(b) Each Lender's Loans shall also be evidenced by a Note
payable to the order of such Lender in a maximum principal amount equal
to such Lender's Percentage of the Total Commitment. The Borrower
hereby irrevocably authorizes each Lender to make (or cause to be made)
appropriate notations on the grid attached to such Lender's Note (or on
any continuation of such grid) or in other books and records maintained
by such Lender, which notations, if made, shall evidence, inter alia,
the date of, the outstanding principal of, and the interest rate and
Interest Period applicable to the Loans evidenced thereby (the Borrower
may from time to time reasonably request a copy of such grid). Such
notations shall be conclusive and binding on the Borrower absent
manifest error; provided, however, that the failure of any Lender to
make any such notations shall not limit or otherwise affect any
Obligations of the Borrower or any other Obligor.
(c) The Borrower acknowledges that the Notes delivered to the
Lenders as of the Effective Date amend, restate and renew the
promissory notes given by the Borrower under the Existing Credit
Agreement, and nothing in this Agreement or the other Loan Documents is
intended to novate or discharge the indebtedness of the Borrower or the
other Obligors under the Existing Credit Agreement.
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SECTION 2.7. BORROWING BASE REDETERMINATION.
(a) Within fifteen (15) Business Days after receipt of the
Engineering Report required to be delivered semi-annually, commencing
with the Engineering Report required to be delivered not later than
September 1, 1999, the Administrative Agent shall, based upon a review
of such Engineering Report, propose to all of the Lenders a
redetermined Borrowing Base. All of the Lenders shall, within ten (10)
Business Days after receipt from the Administrative Agent of a proposal
for a redetermined Borrowing Base, approve a redetermined Borrowing
Base either (i) at the amount proposed by the Administrative Agent, or
(ii) such other amount as all of the Lenders may approve, as provided
in Section 2.7(d). Upon approval of a redetermined Borrowing Base, the
Administrative Agent shall notify the Borrower in writing of the
Borrowing Base determined by all of the Lenders on the basis of such
Engineering Report. Each such determination is herein called a
"Scheduled Redetermination". Each Scheduled Redetermination shall be
effective as of (i) April 1st (with respect to Engineering Reports
effective January 1st), and (ii) October 1st (with respect to
Engineering Reports effective July 1st) upon notification of the
Borrower by the Administrative Agent.
(b) The Administrative Agent (on behalf of the Lenders) or the
Borrower may, from time to time (but not more frequently than (i) one
time during any calendar year by the Lenders, (ii) one time during any
calendar year by the Borrower and (iii) in connection with any
acquisition by the Borrower or its Subsidiaries of Oil and Gas
Properties having a purchase price of $25 million or more), request a
redetermination (at the sole cost and expense of the Borrower) of the
Borrowing Base based upon the most recently received Engineering
Report. Each such requested redetermination is herein called a
"Requested Redetermination." The Lenders shall establish the
redetermined Borrowing Base, and the Administrative Agent shall notify
the Borrower in writing of the Borrowing Base determined by the
Lenders, not later than thirty (30) days after such Requested
Redetermination by the Borrower. Each Requested Redetermination shall
be effective when the Borrower is notified of the amount of the
redetermined Borrowing Base by the Administrative Agent.
(c) Within five (5) Business Days after receipt of a notice
from the Administrative Agent of the amount of a redetermined Borrowing
Base, the Borrower shall by notice to the Administrative Agent either
accept such amount as the new Borrowing Base or reduce the Borrowing
Base from the amount proposed by the Administrative Agent to any lesser
amount. Failure by the Borrower to take either such action within such
five (5) Business Day period shall be deemed acceptance of such amount
as the Borrowing Base. Upon any such acceptance or deemed acceptance by
the Borrower, a new Borrowing Base in the amount accepted shall take
effect on such date (herein called a
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"Borrowing Base Determination Date") and shall remain in effect until
but not including the next Borrowing Base Determination Date. Upon any
such reduction by the Borrower, a new Borrowing Base in the reduced
amount specified by the Borrower shall take effect on such date (herein
also called a "Borrowing Base Determination Date") and shall remain in
effect until but not including the next Borrowing Base Determination
Date.
(d) Each determination or redetermination of the Borrowing
Base pursuant to this Section 2.7 and Section 3.1.2 shall be made by
all of the Lenders and the Administrative Agent, in the exercise of
their reasonable discretion and in accordance with their customary and
prudent standards for oil and gas lending and credit transactions as
they exist at such time (which standards may change from time to time).
In each case where the Administrative Agent shall propose a
redetermined Borrowing Base, any Lender who objects to the proposed
Borrowing Base shall, within the prescribed time period, simultaneously
notify the Administrative Agent of the amount of the redetermined
Borrowing Base that it believes appropriate, and such objecting Lender
shall be deemed to have approved any Borrowing Base which is less than
the Borrowing Base it believes is appropriate. Any Lender that does not
object to the redetermined Borrowing Base proposed by the
Administrative Agent within the prescribed time period shall be deemed
to have approved the redetermined Borrowing Base proposed by the
Administrative Agent. In the event that the Lenders do not so approve
the redetermined Borrowing Base as proposed by the Administrative
Agent, the Administrative Agent shall consult with each Lender that has
so objected and thereafter establish a redetermined Borrowing Base that
is so approved by the Lenders.
(e) The Borrowing Base is also subject to adjustment as
provided for in Section 3.1.2.
SECTION 2.8. PURPOSES. The Borrower shall apply the proceeds of each
Loan only
(a) to refinance all Indebtedness under the Existing Credit
Agreement; and
(b) for Capital Expenditures, working capital and general
corporate purposes of the Borrower and its Material
Subsidiaries.
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ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. REPAYMENTS AND PREPAYMENTS AND CERTAIN BORROWING BASE
MATTERS. The Borrower shall repay the unpaid principal amount of the Loans as
set forth in this Section 3.1.
SECTION 3.1.1. REPAYMENTS AND PREPAYMENTS. The Borrower shall repay in
full the unpaid principal amount of each Revolving Credit Loan, and each
Revolving Credit Loan shall mature, on the Stated Maturity Date. Prior thereto,
the Borrower
(a) may, from time to time on any Business Day, make a
voluntary prepayment, in whole or in part, of the outstanding principal
amount of any Loans; provided, however, that
(i) in the case of a prepayment of a LIBO Rate Loan,
all such voluntary prepayments shall require at least three
(3) but no more than five (5) Business Days' prior written
notice to the Administrative Agent (which notice is
irrevocable);
(ii) any such prepayment shall be made pro rata among
Loans of the same type and, if applicable, having the same
Interest Period; and
(iii) all such voluntary partial prepayments shall be
in an aggregate minimum amount of $250,000 and an integral
multiple of $50,000;
(b) shall, on each date when any reduction in the Commitment
Amount shall become effective, including pursuant to Section 2.2, make
a mandatory prepayment (which shall be applied (or held for
application, as the case may be) by each Lender first to the payment of
the aggregate unpaid principal amount of those Loans then outstanding
and then to the payment of the then Letter of Credit Outstandings)
equal to the excess, if any, of the aggregate outstanding principal
amount of all Loans and Letter of Credit Outstandings over the
Commitment Amount as so reduced;
(c) shall make prepayments as specified in Section 3.1.2; and
(d) shall, immediately upon any acceleration of the Loans
pursuant to Section 9.2 or Section 9.3, repay all Loans, unless,
pursuant to Section 9.3, only a portion of all Loans is so accelerated.
Each payment or prepayment of any Loans made pursuant to this Section shall be
without premium or penalty except as may be required by Section 5.4, and shall
be applied, to the extent of such prepayment. No voluntary prepayment of
principal of any Loans or any prepayment pursuant to the preceding clause (c)
shall cause a reduction in any Commitment Amount.
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SECTION 3.1.2. BORROWING BASE DEFICIENCIES AND ASSET SALES.
(a) Upon the occurrence of a Borrowing Base Deficiency, the
Administrative Agent may (and, at the direction of the Required
Lenders, shall) notify the Borrower of such Borrowing Base Deficiency.
Within ten (10) days from and after the Borrowing Base Deficiency
Notification Date, the Borrower shall notify the Administrative Agent
that it shall, at its election, take one of the following actions
within ninety (90) days after the occurrence of such Borrowing Base
Deficiency:
(i) it will execute and deliver to the Administrative
Agent supplemental or additional Security Documents, in form
and substance satisfactory to the Administrative Agent and its
counsel, securing payment of the Notes and the other
Obligations and covering additional Oil and Gas Properties
directly owned by the Borrower or one or more of its Material
Subsidiaries which are not then covered by any Security
Document and which are of a type and nature, and having a
value (as determined by the Administrative Agent and the
Required Lenders, and in addition to other Oil and Gas
Properties already subject to a Mortgage) and/or other
collateral of a type, in an amount, and in all other respects
satisfactory to the Administrative Agent and the Required
Lenders, sufficient to eliminate the Borrowing Base
Deficiency, all as more particularly described in Section
8.1.7(a) and (b), or
(ii) it will pay an amount in respect of the
Obligations (which shall be applied (or held for application,
as the case may be) by the Administrative Agent to the payment
of the aggregate unpaid principal amount of those Loans then
outstanding and then Letter of Credit Outstandings) in an
aggregate principal amount sufficient to eliminate such
Borrowing Base Deficiency.
If the Borrower shall elect to execute and deliver supplemental or
additional Security Documents to the Administrative Agent pursuant to
clause (i), it shall provide the Administrative Agent and each Lender
with descriptions of the additional assets to be collaterally assigned
(together with current valuations, Engineering Reports, Security
Documents described in clause (i) and title evidence applicable
thereto, each of which shall be in form and substance satisfactory to
the Administrative Agent) within thirty (30) days after the Borrowing
Base Deficiency Notification Date. Such supplemental or additional
Security Documents shall be subject to the terms of Section 8.1.7. If
the Borrower fails to take either of the actions described above within
such ten (10)-day period, then without any necessity for notice to the
Borrower or any other person, the Borrower shall become obligated
immediately to pay
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Obligations in an aggregate principal amount equal to the applicable
Borrowing Base Deficiency.
(b) If the Borrower or any Subsidiary sells, transfers or
otherwise disposes of Properties included in the most recent
determination of the Borrowing Base and that have an aggregate sales
price in excess of three percent (3%) of the then current Borrowing
Base during the period from the effective date of the most recent
Borrowing Base Determination until the effective date of the next
Borrowing Base Determination, the Borrowing Base shall be immediately
reduced, until the effective date of the next Borrowing Base
Determination, by an amount as reasonably determined by the
Administrative Agent and approved by the Required Lenders.
If such reduction shall result in a Borrowing Base Deficiency, then in
lieu of the provisions of clause (a) of Section 3.1.2, the Borrower
shall immediately make a payment with respect to the Obligations in an
amount equal to such Borrowing Base Deficiency. In addition to and
cumulative of the foregoing, if a Borrowing Base Deficiency exists
prior to such sale, transfer or other disposition of assets, then in
lieu of the provisions of clause(a) of Section 3.1.2, the Borrower
shall immediately make a payment with respect to the Obligations (which
shall be applied (or held for application, as the case may be) by the
Lenders first to the payment of the aggregate unpaid principal amount
of those Loans then outstanding, and then to the payment of the then
Letter of Credit Outstandings) in an aggregate principal amount equal
to the lesser of the amount of the Borrowing Base Deficiency (after
giving effect to the applicable sale, transfer or other disposition) or
100% of the sales proceeds from the applicable sale, transfer or other
disposition, net of usual and customary fees, expenses and taxes.
In addition, if the Borrower or any of its Subsidiaries raises capital
through the issuance of any type of equity or issues any subordinated
debt or senior unsecured debt otherwise permitted by this Agreement,
the proceeds of such issuance, net of usual and customary fees,
expenses and taxes, will first be applied to cure any Borrowing Base
Deficiency.
SECTION 3.2. INTEREST PROVISIONS. Interest on the outstanding principal
amount of Loans shall accrue and be payable in accordance with this Section 3.2.
SECTION 3.2.1. RATES. Pursuant to an appropriately delivered Borrowing
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:
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(a) on that portion maintained from time to time as a Base
Rate Loan, equal to the lesser of (I) the sum of the Alternate Base
Rate from time to time in effect plus the Applicable Margin, and (ii)
the Highest Lawful Rate; and
(b) on that portion maintained as LIBO Rate Loans, during each
Interest Period applicable thereto, equal to the lesser of (I) the sum
of the LIBO Rate (Reserve Adjusted) for such Interest Period plus the
Applicable Margin, and (ii) the Highest Lawful Rate.
Notwithstanding the foregoing limitations pertaining to the Highest Lawful Rate,
in the event that the amount payable under this Section 3.2.1 is limited to the
Highest Lawful Rate, the Lenders and Issuers shall have the benefit of the
provisions of Section 11.15 including Section 11.15(a)(iv).
SECTION 3.2.2. POST-MATURITY RATES. After (w) the date any principal
amount of any Loan shall have become due and payable (whether on the Stated
Maturity Date, upon acceleration or otherwise, but only so long as such
principal amount has not been paid), (x) any other monetary Obligation of the
Borrower shall have become due and payable beyond any applicable grace period
(including the failure of the Borrower to pay in full the amount of any
Reimbursement Obligation on the applicable Disbursement Date, but only so long
as such monetary Obligation has not been paid), (y) the date any other Event of
Default shall have occurred (and so long as such Event of Default shall be
continuing), and (z) the date that is ninety (90) days after a Borrowing Base
Deficiency Notification Date, if the applicable Borrowing Base Deficiency has
not been cured, the Borrower shall pay, but only to the extent permitted by
Applicable Law, interest (after as well as before judgment) on all Obligations
at a rate per annum equal to
(a) with respect to LIBO Rate Loans for the period from the
date such Loan becomes due and payable to the end of the then current
Interest Period, the higher of (i) the sum of the LIBO Rate (Reserve
Adjusted) for such Interest Period plus the Applicable Margin plus a
margin of 3%, or (ii) the sum of the Alternate Base Rate plus the
Applicable Margin plus a margin of 3%; or
(b) in all other cases, the sum of the Alternate Base Rate
plus the Applicable Margin plus a margin of 3%.
SECTION 3.2.3. PAYMENT DATES. Interest accrued on each Loan shall be
payable, without duplication:
(a) on the Stated Maturity Date;
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(b) on the date of any optional or required payment or
prepayment, in whole or in part, of principal outstanding on such Loan
and on that portion of such Loan so paid or prepaid;
(c) with respect to Base Rate Loans, on each Quarterly Payment
Date occurring after the Effective Date;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed
three months, on the 90th day of such Interest Period);
(e) with respect to any Base Rate Loans converted into LIBO
Rate Loans on a day when interest would not otherwise have been payable
pursuant to clause (c), on the date of such conversion; and
(f) on that portion of any Loans which is accelerated pursuant
to Section 9.2 or Section 9.3, immediately upon such acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount shall have
become due and payable (whether on the Stated Maturity Date, upon acceleration
or otherwise) shall be payable upon demand.
SECTION 3.3. FEES. The Borrower agrees to pay the fees set forth in
this Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. CLOSING FEE. On the Effective Date, the Borrower
agrees to pay to the Administrative Agent, at the closing for the pro rata
account of each of the Lenders, an upfront fee in an amount based on each
Lender's Percentage of the Total Commitment as the Borrower and the Lenders have
previously agreed.
SECTION 3.3.2. ADMINISTRATIVE AGENT'S FEES. The Borrower shall pay to
the Administrative Agent for its own account the fees set forth in the Fee
Letter on the respective dates for such payment prescribed in the Fee Letter.
SECTION 3.3.3. COMMITMENT FEES. The Borrower shall pay to the
Administrative Agent, for the pro rata account of each Lender, a Commitment Fee
(the "Commitment Fee"), for the period from and including the Effective Date to
but not including any Commitment Termination Date, equal to an amount determined
in accordance with the utilization of the Borrowing Base as set forth in the
definition of "Applicable Margin," of such Lender's Percentage of the daily
average Total Commitment less the sum of (i) the aggregate outstanding principal
amount of all Loans on such date, plus (ii) the Letter of Credit Outstandings on
such date. Accrued
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Commitment Fees shall be payable by the Borrower in arrears on each Quarterly
Payment Date and on the earlier of any Commitment Termination Date.
SECTION 3.3.4. LETTER OF CREDIT FACE AMOUNT FEE. The Borrower agrees
to pay to the Administrative Agent, for the pro rata account of each Lender, a
fee for each Letter of Credit for the period from and including the date of the
issuance of such Letter of Credit to (but not including) the date upon which
such Letter of Credit expires or is fully drawn, at a rate per annum equal to
the Applicable Margin (LIBO Rate column) per annum on the Stated Amount of such
Letter of Credit. Such fee shall be payable by the Borrower in arrears on each
Quarterly Payment Date, and on any Commitment Termination Date for any period
then ending for which such fee shall not theretofore have been paid, commencing
on the first such date after the issuance of such Letter of Credit.
SECTION 3.3.5. LETTER OF CREDIT ISSUANCE FEE. The Borrower shall pay
to the Administrative Agent, for the account of the applicable Issuer, a letter
of credit issuance fee for each Letter of Credit issued by such Issuer equal to
the greater of (x) 1/8 of 1% of the Stated Amount of such Letter of Credit or
(y) $300. Such Letter of Credit fronting fee shall be due and payable on the
date of such issuance.
SECTION 3.3.6. LETTER OF CREDIT ADMINISTRATIVE FEE. The Borrower
shall pay to the Administrative Agent, for the account of each Issuer, from time
to time on demand the normal issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the Issuer relating to
letters of credit as from time to time in effect.
SECTION 3.3.7. ENGINEERING FEES. For each Requested Redetermination
in connection with an acquisition of Oil and Gas Properties pursuant to Section
2.7(b)(iii), the Borrower shall pay fees in the amount of $10,000 to the
Administrative Agent (for its own account) and $5,000 to each other Lender.
SECTION 3.4. PROCEEDS ACCOUNT. The Security Documents contain an
assignment to the Administrative Agent by the Borrower and its Subsidiaries of
all production of Hydrocarbons and all proceeds attributable thereto properly
allocable to the Mortgaged Properties. Notwithstanding such assignment of
production, the Borrower or such Subsidiaries, as applicable, may, until the
Administrative Agent shall give notice to the contrary, receive such proceeds.
Thereafter, all such proceeds from the sale of such production shall be paid
directly into an account of the Borrower maintained with the Administrative
Agent (the "Proceeds Account"). The Borrower hereby grants to the Administrative
Agent a security interest in the Proceeds Account and all proceeds thereof.
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ARTICLE IV
LETTERS OF CREDIT
SECTION 4.1. ISSUANCE REQUESTS. By delivering to the Administrative
Agent an Issuance Request on or before 12:00 noon (Dallas time), the Borrower
may request, from time to time prior to any Commitment Termination Date, and on
not less than three (3) nor more than ten (10) Business Days' notice, that such
Issuer issue an irrevocable standby letter of credit in such form as may be
mutually agreed by the Borrower and such Issuer (each a "Letter of Credit"), in
support of financial or performance obligations of the Borrower incurred in the
Borrower's ordinary course of business and which are described in such Issuance
Request. Upon receipt of an Issuance Request, the Administrative Agent shall
promptly notify the Lenders and the Issuer thereof. Each Letter of Credit shall
by its terms:
(a) be issued in a Stated Amount which
(i) is at least $50,000;
(ii) does not exceed (or would not exceed) the then
Letter of Credit Availability;
(b) be stated to expire on a date (its "Stated Expiry Date")
no later than the earlier of (i) one (1) year after its date of
issuance, or (ii) the Stated Maturity Date; and
(c) on or prior to its Stated Expiry Date
(i) terminate immediately upon notice to the Issuer
from the beneficiary thereunder that all obligations covered
thereby have been terminated, paid, or otherwise satisfied in
full, or
(ii) reduce in part immediately and to the extent the
beneficiary thereunder has notified the Issuer that the
obligations covered thereby have been paid or otherwise
satisfied in part.
So long as no Default has occurred and is continuing, by delivery to the
Administrative Agent and to the applicable Issuer of an Issuance Request at
least five (5) but not more than ten (10) Business Days prior to the Stated
Expiry Date of any Letter of Credit, the Borrower may request such Issuer to
extend the Stated Expiry Date of such Letter of Credit for an additional period
not to exceed the earlier of one (1) year from its date of extension, the Stated
Maturity Date or the Commitment Termination Date.
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SECTION 4.2. ISSUANCES AND EXTENSIONS. On the terms and subject to the
conditions of this Agreement (including Article VI), the applicable Issuer shall
issue Letters of Credit, and extend the Stated Expiry Dates of outstanding
Letters of Credit, in accordance with the Issuance Requests made therefor. Each
Issuer will make available the original of each Letter of Credit which it issues
in accordance with the Issuance Request therefor to the beneficiary thereof (and
will promptly provide the Administrative Agent and each of the Lenders with a
copy of such Letter of Credit) and will notify the beneficiary under any Letter
of Credit of any extension of the Stated Expiry Date thereof.
The Issuer is under no obligation to issue any Letter of Credit if:
(a) any order, judgment or decree of any Government Agency or
arbitrator shall by its terms purport to enjoin or restrain the Issuer
from issuing such Letter of Credit, or any requirement of Applicable
Law or any request or directive (whether or not having the force of
law) from any Government Agency with jurisdiction over the Issuer shall
prohibit, or request that the Issuer refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or
shall impose upon the Issuer with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the Issuer is
not otherwise compensated hereunder) not in effect on the Effective
Date, or shall impose upon the Issuer any unreimbursed loss, cost or
expense which was not applicable on the Effective Date and which the
Issuer in good faith deems material to it;
(b) one or more of the applicable conditions contained in
Article VI is not then satisfied;
(c) the expiry date of any requested Letter of Credit is prior
to the maturity date of any financial obligation to be supported by the
requested Letter of Credit;
(d) any requested Letter of Credit does not provide for
drafts, or is not otherwise in form and substance acceptable to the
Issuer, or the issuance of a Letter of Credit shall violate any
applicable policies of the Issuer;
(e) any standby Letter of Credit is for the purpose of
supporting the issuance of any letter of credit by any other Person; or
(f) such Letter of Credit is in a face amount denominated in a
currency other than Dollars.
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The International Standby Practices as published by the International
Chamber of Commerce most recently at the time of issuance of any Letter of
Credit shall (unless otherwise expressly provided in the Letters of Credit)
apply to the Letters of Credit.
SECTION 4.3. LENDERS' PARTICIPATION. Each Letter of Credit issued
pursuant to Section 4.2 shall, effective upon its issuance and without further
action, be issued on behalf of all Lenders (including the Issuer thereof, if it
is a Lender) pro rata according to their respective Percentages. Each Lender
shall, to the extent of its Percentage, be deemed irrevocably to have
participated in the issuance of such Letter of Credit and shall be responsible
to reimburse promptly the Issuer thereof for Reimbursement Obligations which
have not been reimbursed by the Borrower in accordance with Section 4.5, or
which have been reimbursed by the Borrower but must be returned, restored or
disgorged by such Issuer for any reason, and each Lender shall, to the extent of
its Percentage, be entitled to receive from the Administrative Agent a ratable
portion of the Letter of Credit fees received by the Administrative Agent
pursuant to Section 3.3.4, with respect to each Letter of Credit. In the event
that the Borrower shall fail to reimburse any Issuer, or if for any reason Loans
shall not be made to fund any Reimbursement Obligation, all as provided in
Section 4.5 and in an amount equal to the amount of any drawing honored by such
Issuer under a Letter of Credit issued by it, or in the event such Issuer must
for any reason return or disgorge such reimbursement, such Issuer shall promptly
notify each Lender of the unreimbursed amount of such drawing and of such
Lender's respective participation therein. Each Lender shall make available to
such Issuer, whether or not any Default shall have occurred and be continuing,
an amount equal to its respective participation in same day or immediately
available funds at the office of such Issuer specified in such notice not later
than 11:00 a.m. (Dallas time) on the Business Day (under the laws of the
jurisdiction of such Issuer) after the date notified by such Issuer. In the
event that any Lender fails to make available to such Issuer the amount of such
Lender's participation in such Letter of Credit as provided herein, such Issuer
shall be entitled to recover such amount on demand from such Lender together
with interest at the daily average Federal Funds Rate for three (3) Business
Days (together with such other compensatory amounts as may be required to be
paid by such Lender to the Administrative Agent pursuant to the Rules for
Interbank Compensation of the Council on International Banking or the
Clearinghouse Compensation Committee, as the case may be, as in effect from time
to time) and thereafter at the Alternate Base Rate plus 3%. Nothing in this
Section shall be deemed to prejudice the right of any Lender to recover from any
Issuer any amounts made available by such Lender to such Issuer pursuant to this
Section in the event that it is determined by a court of competent jurisdiction
that the payment with respect to a Letter of Credit by such Issuer in respect of
which payment was made by such Lender constituted gross negligence or wilful
misconduct on the part of such Issuer. Each Issuer shall distribute to each
other Lender which has paid all amounts payable by it under this Section with
respect to any Letter of Credit issued by such Issuer such other Lender's
Percentage of all payments
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received by such Issuer from the Borrower in reimbursement of drawings honored
by such Issuer under such Letter of Credit when such payments are received.
SECTION 4.4. DISBURSEMENTS. Each Issuer will notify the Borrower and
the Administrative Agent promptly of the presentment for payment of any Letter
of Credit, together with notice of the date (the "Disbursement Date") such
payment shall be made. Subject to the terms and provisions of such Letter of
Credit, the applicable Issuer shall make such payment to the beneficiary (or its
designee) of such Letter of Credit. In paying any drawing under a Letter of
Credit, the applicable Issuer shall not have any responsibility to obtain any
document (other than any sight draft and certificates expressly required by the
Letter of Credit) or to ascertain or inquire as to the validity or accuracy of
any such document or the authority of the Person executing or delivering any
such document. Prior to 12:00 noon (Dallas time) on the Disbursement Date, the
Borrower will reimburse the applicable Issuer for all amounts which have been
disbursed under the Letter of Credit. To the extent the applicable Issuer is not
reimbursed in full in accordance with the preceding sentence, the Borrower's
Reimbursement Obligation shall accrue interest at a fluctuating rate determined
by reference to the Alternate Base Rate, plus the Applicable Margin, plus a
margin of 3% per annum, payable on demand. In the event the applicable Issuer is
not reimbursed by the Borrower on the Disbursement Date, or if such Issuer must
for any reason return or disgorge such reimbursement, the Lenders (including
such Issuer) shall, on the terms and subject to the conditions of this
Agreement, fund the Reimbursement Obligation therefor by making, on the next
Business Day, Loans, which are Base Rate Loans, as provided in Section 2.1.1,
bearing interest at the rate provided in Section 3.2.2 (the Borrower being
deemed to have given a timely Borrowing Request therefor for such amount);
provided, however, for the purpose of determining the availability of the
Commitments to make Loans immediately prior to giving effect to the application
of the proceeds of such Loans, such Reimbursement Obligation shall be deemed not
to be outstanding at such time.
SECTION 4.5. REIMBURSEMENT. The Borrower's obligation (a "Reimbursement
Obligation") under Section 4.4 to reimburse the applicable Issuer with respect
to each Disbursement (including interest thereon), and each Lender's obligation
to make participation payments in each drawing which has not been reimbursed by
the Borrower, shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim, or defense to
payment which the Borrower may have or have had against such Issuer or any
Lender or any beneficiary of a Letter of Credit, including any defense based
upon the occurrence of any Default, any draft, demand or certificate or other
document presented under a Letter of Credit proving to be forged, fraudulent,
invalid or insufficient, the failure of any Disbursement to conform to the terms
of the applicable Letter of Credit (if, in the applicable Issuer's good faith
opinion, such Disbursement is determined to be appropriate) or any
non-application or misapplication by the beneficiary of the proceeds of such
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Disbursement, or the legality, validity, form, regularity, or enforceability of
such Letter of Credit;
SECTION 4.6. DEEMED DISBURSEMENTS. Upon the occurrence of any
Commitment Termination Date, an amount equal to that portion of Letter of Credit
Outstandings attributable to outstanding and undrawn Letters of Credit shall, at
the election of the applicable Issuer, acting on instructions from the Required
Lenders, and without demand upon or notice to the Borrower, be deemed to have
been paid or disbursed by such Issuer under such Letters of Credit
(notwithstanding that such amount may not in fact have been so paid or
disbursed), and, upon notification by such Issuer to the Administrative Agent
and the Borrower of its obligations under this Section, the Borrower shall be
immediately obligated to reimburse such Issuer the amount deemed to have been so
paid or disbursed by such Issuer. Any amounts so received by such Issuer from
the Borrower pursuant to this Section shall be held as collateral security for
the repayment of the Borrower's obligations in connection with the Letters of
Credit issued by such Issuer. At any time when such Letters of Credit shall
terminate and all Obligations to such Issuer are either terminated or paid or
reimbursed to such Issuer in full, the Obligations of the Borrower under this
Section shall be reduced accordingly (subject, however, to reinstatement in the
event any payment in respect of such Letters of Credit is recovered in any
manner from such Issuer), and such Issuer will return to the Borrower the
excess, if any, of
(a) the aggregate amount deposited by the Borrower with such
Issuer and not theretofore applied by such Issuer to any Reimbursement
Obligation
over
(b) the aggregate amount of all Reimbursement Obligations to
such Issuer pursuant to this Section, as so adjusted.
At such time when all Events of Default shall have been cured or waived, such
Issuer shall return to the Borrower all amounts then on deposit with such Issuer
pursuant to this Section. All amounts on deposit pursuant to this Section shall,
until their application to any Reimbursement Obligation or their return to the
Borrower, as the case may be, bear interest at the daily average Federal Funds
Rate from time to time in effect (net of the costs of any reserve requirements,
in respect of amounts on deposit pursuant to this Section, pursuant to F.R.S.
Board Regulation D), which interest shall be held by such Issuer as additional
collateral security for the repayment of the Borrower's Obligations in
connection with the Letters of Credit issued by such Issuer.
SECTION 4.7. NATURE OF REIMBURSEMENT OBLIGATIONS. The Borrower shall
assume all risks of the acts, omissions, or misuse of any Letter of Credit by
the
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beneficiary thereof. Neither the Issuer nor any Lender (except to the extent of
its own gross negligence or wilful misconduct) shall be responsible for:
(a) the form, validity, sufficiency, accuracy, genuineness, or
legal effect of any Letter of Credit or any document submitted by any
party in connection with the application for and issuance of a Letter
of Credit, even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent, or forged;
(b) the form, validity, sufficiency, accuracy, genuineness, or
legal effect of any instrument transferring or assigning or purporting
to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof in whole or in part, which may prove to
be invalid or ineffective for any reason;
(c) failure of the beneficiary to comply fully with conditions
required in order to demand payment under a Letter of Credit;
(d) errors, omissions, interruptions, or delays in
transmission or delivery of any messages, by mail, cable, telegraph,
telex, facsimile or otherwise;
(e) any loss or delay in the transmission or otherwise of any
document or draft required in order to make a Disbursement under a
Letter of Credit or of the proceeds thereof;
(f) any change in the time, manner or place of payment of, or
in any other term of, all or any of the obligations of the Borrower in
respect of any Letter of Credit;
(g) the existence of any claim, set-off, defense or other
right that the Borrower may have at any time against any beneficiary or
any transferee of any Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), the applicable
Issuer or any other Person, whether in connection with this Agreement,
the transactions contemplated hereby or by the Letters of Credit or any
unrelated transaction;
(h) any payment by the applicable Issuer under any Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of any Letter of Credit; or any payment
made by the applicable Issuer under any Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of
any Letter of Credit, including any arising in connection with any
insolvency proceeding; or
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(i) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including any other circumstance
that might otherwise constitute a defense available to, or a discharge
of, the Borrower or a guarantor.
None of the foregoing shall affect, impair, or prevent the vesting of any of the
rights or powers granted any Issuer or any Lender hereunder. In furtherance and
extension, and not in limitation or derogation, of any of the foregoing, any
action taken or omitted to be taken by any Issuer or any Lender in good faith
with respect to any Letter of Credit shall be binding upon the Borrower and
shall not put such Issuer or such Lender under any resulting liability to the
Borrower.
SECTION 4.8. INCREASED COSTS; INDEMNITY. If by reason of
(a) any change after the Effective Date in applicable law,
regulation, rule, decree or regulatory requirement or any change in the
interpretation or application by any judicial or regulatory authority
of any law, regulation, rule, decree or regulatory requirement, or
(b) compliance by any Issuer or any Lender with any direction,
request or requirement (whether or not having the force of law) of any
governmental or monetary authority, including Regulation D of the
F.R.S. Board:
(i) any Issuer or any Lender shall be subject to any
tax (other than taxes on net income and franchises), levy,
charge or withholding of any nature or to any variation
thereof or to any penalty with respect to the maintenance or
fulfillment of its obligations under this Article IV, whether
directly or by such being imposed on or suffered by any Issuer
or any Lender;
(ii) any reserve, deposit or similar requirement is
or shall be applicable, increased, imposed or modified in
respect of any Letters of Credit issued by any Issuer or
participations therein purchased by any Lender; or
(iii) there shall be imposed on any Issuer or any
Lender any other condition regarding this Article IV or any
Letter of Credit or any participation therein,
and the result of the foregoing is directly or indirectly to increase the cost
to any Issuer or such Lender of issuing or maintaining any Letter of Credit or
of purchasing or maintaining any participation therein, or to reduce any amount
receivable in respect thereof by any Issuer, then and in any such case any such
Issuer or any such Lender may, at any time after the additional cost is incurred
or the amount received is
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reduced, notify the Administrative Agent and the Borrower thereof, and the
Borrower shall, on demand, pay such amounts as any Issuer or such Lender may
specify to be necessary to compensate any Issuer or such Lender for such
additional cost or reduced receipt, together with interest at a rate equal to
the Alternate Base Rate plus the Applicable Margin on such amount from the date
demanded until the fifth Business Day after such demand and thereafter at a rate
equal at all times to the Alternate Base Rate plus the Applicable Margin, plus
3% per annum until payment in full thereof. The determination by any such Issuer
or any such Lender, as the case may be, of any amount due pursuant to this
Section, as set forth in a statement setting forth the calculation thereof in
reasonable detail, shall, in the absence of manifest error, be final and
conclusive and binding on all of the parties hereto.
In addition to amounts payable as elsewhere provided in this Article
IV, the Borrower hereby indemnifies, exonerates and holds each Issuer, the
Administrative Agent and each Lender harmless from and against any and all
actions, causes of action, suits, losses, costs, liabilities and damages, and
expenses incurred in connection therewith (irrespective of whether such Issuer,
the Administrative Agent or such Lender is a party to the action for which
indemnification is sought), including reasonable attorneys' fees and
disbursements, which such Issuer, the Administrative Agent or such Lender may
incur or be subject to as a consequence, direct or indirect, of
(a) the issuance of the Letters of Credit, other than as a
result of the gross negligence or wilful misconduct of such Issuer as
determined by a court of competent jurisdiction, or
(b) the failure of such Issuer to honor a drawing under any
Letter of Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto Government
Agency.
ARTICLE V
CERTAIN INTEREST RATE AND OTHER PROVISIONS
SECTION 5.1. LIBO RATE LENDING UNLAWFUL. If any Lender shall determine
(which determination shall, upon notice thereof to the Borrower, the
Administrative Agent and the other Lenders, be conclusive and binding on the
Borrower) that the introduction of or any change in or in the interpretation by
any governmental or other regulatory authority charged with the administration
thereof of any law makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for such Lender to make, continue or
maintain any Loan as, or to convert any Loan into, a LIBO Rate Loan, the
obligations of all Lenders to make, continue, maintain or convert into any such
LIBO Rate Loans shall, upon such determination,
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forthwith be suspended until such Lender shall notify the Administrative Agent
and the Borrower that the circumstances causing such suspension no longer exist,
and all LIBO Rate Loans shall automatically convert into Base Rate Loans at the
end of the then current Interest Periods with respect thereto or sooner, if
required by such law or assertion; provided that if circumstances subsequently
change so that such Lender shall not continue to be so affected, such Lender
shall by notice to the Borrower reinstate such obligations to make, convert,
maintain or continue loans as, or into, LIBO Rate Loans.
SECTION 5.2. DEPOSITS UNAVAILABLE. If the Administrative Agent shall
have determined that
(a) Dollar deposits in the relevant amount and for the
relevant Interest Period are not available to the Administrative Agent
in its relevant market; or
(b) by reason of circumstances affecting the Administrative
Agent's relevant market, adequate means do not exist for ascertaining
the interest rate applicable hereunder to LIBO Rate Loans,
then, upon notice from the Administrative Agent to the Borrower and the Lenders,
the obligations of all Lenders under Section 2.3 and Section 2.4 to make or
continue any Loans as, or to convert any Loans into, LIBO Rate Loans shall
forthwith be suspended until the Administrative Agent shall notify the Borrower
and the Lenders that the circumstances causing such suspension no longer exist.
SECTION 5.3. INCREASED LIBO RATE LOAN COSTS, ETC. If by reason of
(a) after the Effective Date, any change in Applicable Law or
any change in the interpretation or application by any judicial or
regulatory authority of any Applicable Law, or
(b) compliance by any Lender or any Issuer with any direction,
request or requirement (whether or not having the force of law) of any
Government Agency, including Regulation D of the F.R.S. Board:
(i) any Lender or any Issuer shall be subject to any
tax (other than taxes on net income and franchises), levy,
charge or withholding of any nature or to any variation
thereof or to any penalty with respect to any payment due
under any LIBO Rate Loan or other amounts due under this
Agreement, whether directly or by such being imposed on or
suffered by such Lender or any Issuer;
(ii) any reserve, deposit or similar requirement is
or shall be applicable, increased, imposed or modified in
respect of any extensions
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of credit or other assets of, or any deposits with or other
liabilities of, any Lender or Loans made by such Lender or any
Issuer or Letters of Credit issued by such Issuer, or against
any other funds, obligations or other property owned or held
by such Lender or such Issuer and such Lender or such Issuer
actually incurs such additional costs; or
(iii) there shall be imposed on any Lender or any
Issuer any other condition affecting this Agreement (or any of
such extensions of credit or liabilities),
and the result of the foregoing is directly or indirectly to increase the cost
to such Lender of making, continuing or such Issuer of issuing or maintaining
(or of its obligation to make, continue or maintain) any Loans as, or of
converting or such Issuer (or of its obligation to convert) any Loans into, LIBO
Rate Loans, or of the Issuer issuing or maintaining any Letter of Credit or to
reduce any amount receivable in respect thereof by such Lender or such Issuer,
then and in any such case such Lender or such Issuer may, at any time after the
additional cost is incurred or the amount received is reduced, notify the
Administrative Agent and the Borrower thereof, and the Borrower shall pay on
demand such amounts as such Lender or such Issuer may specify to be necessary to
compensate such Lender or such Issuer for such additional cost or reduced
receipt, together with interest at a rate equal to the Alternate Base Rate plus
the Applicable Margin on such amount from the date demanded until the fifth
Business Day after such demand and thereafter at a rate equal at all times to
the Alternate Base Rate plus the Applicable Margin plus 3% per annum until
payment in full thereof. The determination by such Lender or such Issuer of any
amount due pursuant to this Section, as set forth in a statement setting forth
the calculation thereof in reasonable detail, shall, in the absence of manifest
error, be final and conclusive and binding on all of the parties hereto.
SECTION 5.4. FUNDING LOSSES. In the event any Lender or any Issuer
shall incur any loss or expense (including any loss or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired by
such Lender or such Issuer to make, continue or maintain any portion of the
principal amount of any Loan as, or to convert any portion of the principal
amount of any Loan into, a LIBO Rate Loan) as a result of
(a) any conversion or repayment or prepayment of the principal
amount of any LIBO Rate Loans on a date other than the scheduled last
day of the Interest Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any Loans not being made as LIBO Rate Loans in accordance
with the Borrowing Request therefor by reason of any act or omission by
the Borrower or failure of a condition precedent to be satisfied; or
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(c) any Loans not being continued as, or converted into, LIBO
Rate Loans in accordance with the Continuation/Conversion Notice
therefor by reason of any act or omission by the Borrower,
then, upon the written notice of such Lender or such Issuer to the Borrower
(with a copy to the Administrative Agent), the Borrower shall pay directly to
such Lender or such Issuer such amount as will (in the reasonable determination
of such Lender or such Issuer) reimburse such Lender or such Issuer for such
loss or expense, together with interest at a rate equal to the Alternate Base
Rate plus the Applicable Margin on such amount from the date demanded until the
fifth Business Day after such demand and thereafter at a rate equal at all times
to the Alternate Base Rate plus the Applicable Margin plus 3% per annum until
payment in full thereof. Such written notice (which shall include calculations
in reasonable detail) shall, in the absence of manifest error, be conclusive and
binding on the Borrower.
SECTION 5.5. INCREASED CAPITAL COSTS. If, after the Effective Date, any
change in, or the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in of, any Applicable Law of any Government Agency
affects or would affect the amount of capital required or expected to be
maintained by any Issuer or any Lender or any Person controlling such Issuer or
such Lender, and such Issuer or such Lender determines (in its sole and absolute
discretion) that the rate of return on its or such controlling Person's capital
as a consequence of its Commitments, issuance of or participation in Letters of
Credit issued by or the Loans made by such Issuer or such Lender is reduced to a
level below that which such Issuer or such Lender or such controlling Person
could have achieved but for the occurrence of any such circumstance, then, in
any such case upon notice from time to time by such Issuer or such Lender to the
Borrower and the Administrative Agent, the Borrower shall immediately pay
directly to such Issuer or such Lender additional amounts sufficient to
compensate such Issuer or such Lender or such controlling Person for such
reduction in rate of return. A statement of such Issuer or such Lender as to any
such additional amount or amounts (including calculations thereof in reasonable
detail) shall, in the absence of manifest error, be conclusive and binding on
the Borrower. In determining such amount, such Issuer or such Lender may use any
method of averaging and attribution that it (in its reasonable discretion) shall
deem applicable.
SECTION 5.6. TAXES.
(a) All payments by the Borrower of principal of, and interest on, the
Loans or Letters of Credit and all other amounts payable hereunder shall be made
free and clear of and without deduction for any present or future income,
excise, stamp or franchise taxes and other taxes, fees, duties, withholdings or
other charges of any nature whatsoever imposed by any taxing authority, but
excluding franchise taxes and taxes imposed on or measured by any Lender's or
any Issuer's net income, receipts, total assets, net worth or shareholders'
capital (such non-excluded items being called
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"Taxes"). In the event that any withholding or deduction from any payment to be
made by the Borrower hereunder is required in respect of any Taxes pursuant to
any Applicable Law, then the Borrower will
(i) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(ii) promptly forward to the Administrative Agent an official
receipt or other documentation satisfactory to the Administrative Agent
evidencing such payment to such authority; and
(iii) pay to the Administrative Agent for the account of the
Lenders or Issuers such additional amount or amounts as is necessary to
ensure that the net amount actually received by each Lender or each
Issuer will equal the full amount such Lender or such Issuer would have
received had no such withholding or deduction been required.
Moreover, if any Taxes are directly asserted against the Administrative Agent or
any Lender or any Issuer with respect to any payment received by the
Administrative Agent or such Lender or such Issuer hereunder, the Administrative
Agent or such Lender or such Issuer may pay such Taxes and the Borrower will
promptly pay such additional amounts (including any penalties, interest or
expenses) as is necessary in order that the net amount received by such person
after the payment of such Taxes (including any Taxes on such additional amount)
shall equal the amount such person would have received had not such Taxes been
asserted.
(b) If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Administrative Agent for the account
of the Lenders the required receipts or other required documentary evidence, the
Borrower shall indemnify the Lenders and Issuers for any incremental Taxes,
interest, expenses or penalties that may become payable by any Lender or any
Issuer as a result of any such failure, whether or not such Taxes or liabilities
were correctly or legally asserted. Payment under this indemnity shall be made
within thirty (30) days after the date the Administrative Agent makes written
demand therefore. For purposes of this Section 5.6, a distribution hereunder by
the Administrative Agent or any Lender or any Issuer to or for the account of
any Lender or any Issuer shall be deemed a payment by the Borrower.
(c) Notwithstanding the foregoing provisions of this section, the
Borrower shall be entitled, to the extent it is required to do so by law, to
deduct or withhold (and not to make any indemnification or reimbursement for)
income or other similar taxes imposed by the United States of America (other
than any portion thereof attributable to a change in federal income tax laws
effected after the Effective Date) from interest, fees or other amounts payable
hereunder for the account of any Lender,
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other than a Lender (i) who is a U.S. person for Federal income tax purposes or
(ii) who has the Prescribed Forms (defined below) on file with Administrative
Agent (with copies provided to the Borrower) for the applicable year to the
extent deduction or withholding of such taxes is not required as a result of
such Prescribed Forms, provided that if the Borrower shall so deduct or withhold
any such taxes, it shall provide a statement to the Administrative Agent and
such Lender, setting forth the amount of such taxes so deducted or withheld, the
applicable rate and any other information or documentation which such Lender may
reasonably request for assisting such Lender to obtain any allowable credits or
deductions for the taxes so deducted or withheld in the jurisdiction or
jurisdictions in which such Lender is subject to tax. As used in this section,
"Prescribed Forms" means such duly executed forms or statements, and in such
number of copies, which may, from time to time, be prescribed by law and which,
pursuant to applicable provisions of (x) an income tax treaty between the United
States and the country of residence of the Lender providing the forms or
statements, (y) the Code, or (z) any applicable rules or regulations thereunder,
permit the Borrower to make payments hereunder for the account of such Lender
free of such deduction or withholding of income or similar taxes.
SECTION 5.7. PAYMENTS, COMPUTATIONS, ETC. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Note or
any other Loan Document shall be made by the Borrower to the Administrative
Agent for the pro rata account of the Lenders or Issuers entitled to receive
such payment. All such payments shall be made without setoff, deduction or
counterclaim, not later than 11:00 a.m. (Dallas time) on the date due, in same
day or immediately available funds, to such account with the Administrative
Agent in Dallas, Texas as the Administrative Agent shall specify from time to
time by notice to the Borrower. Funds received after that time shall be deemed
to have been received by the Administrative Agent on the next succeeding
Business Day and any applicable interest or fee shall continue to accrue. The
Administrative Agent shall promptly remit in same day funds to each Lender or
each Issuer its share, if any, of such payments received by the Administrative
Agent for the account of such Lender or such Issuer. All interest and fees shall
be computed on the basis of the actual number of days (including the first day
but excluding the last day) occurring during the period for which such interest
or fees is payable over a year comprised of 360 days (or, in the case of
interest on a Base Rate Loan (other than when calculated with respect to the
Federal Funds Rate), 365 days or, if appropriate, 366 days). Whenever any
payment to be made shall otherwise be due on a day which is not a Business Day,
such payment shall (except as otherwise required by clause (c) of the definition
of the term "Interest Period" with respect to LIBO Rate Loans) be made on the
next succeeding Business Day and such extension of time shall be included in
computing interest and fees, if any, in connection with such payment.
SECTION 5.8. SHARING OF PAYMENTS. If any Lender or Issuer shall obtain
any payment or other recovery (whether voluntary, involuntary, by application of
setoff or
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otherwise) on account of any Loan (other than pursuant to the terms of Sections
5.3, 5.4 and 5.5) or Letter of Credit (other than pursuant to Section 4.8) in
excess of its pro rata share of payments then or therewith obtained by all
Lenders, such Lender shall purchase from the other Lenders or Issuers such
participations in Loans made by them and/or Letters of Credit as shall be
necessary to cause such purchasing Lender to share the excess payment or other
recovery ratably with each of them; provided, however, that if all or any
portion of the excess payment or other recovery is thereafter recovered from
such purchasing Lender or Issuer, the purchase shall be rescinded and each
Lender or each Issuer which has sold a participation to the purchasing Lender or
Issuer shall repay to the purchasing Lender or Issuer, the purchase price to the
ratable extent of such recovery together with an amount equal to such selling
Lender's or such Issuer's ratable share (according to the proportion of
(a) the amount of such selling Lender's or such Issuer's
required repayment to the purchasing Lender or Issuer
to
(b) the total amount so recovered from the purchasing Lender
or Issuer)
of any interest or other amount paid by the purchasing Lender or Issuer in
respect of the total amount so recovered. The Borrower agrees that any Lender or
any Issuer so purchasing a participation from another Lender or any Issuer
pursuant to this Section may, to the fullest extent permitted by law, exercise
all its rights of payment (including pursuant to Section 5.9) with respect to
such participation as fully as if such Lender or such Issuer were the direct
creditor of the Borrower in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Lender or any Issuer
receives a secured claim in lieu of a setoff to which this Section applies, such
Lender or such Issuer shall, to the extent practicable, exercise its rights in
respect of such secured claim in a manner consistent with the rights of the
Lenders or Issuers entitled under this Section to share in the benefits of any
recovery on such secured claim.
SECTION 5.9. SETOFF. Each Lender and each Issuer shall, upon the
occurrence of any Default described in clauses (a) through (d) of Section 9.1.9
or, with the consent of the Required Lenders, upon the occurrence of any other
Event of Default, have the right to appropriate and apply to the payment of the
Obligations owing to it (whether or not then due), and (as security for such
Obligations) the Borrower hereby grants to the Administrative Agent, each Lender
and each Issuer a continuing security interest in, any and all balances,
credits, deposits, accounts or moneys of the Borrower then or thereafter
maintained with or otherwise held by the Administrative Agent, each Lender and
each Issuer, including without limitation, the Proceeds Account. The
Administrative Agent, each Lender and each Issuer agree promptly to
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notify the Borrower after any such setoff and application made by the
Administrative Agent or such Lender or such Issuer; provided, however, that the
failure to give such notice shall not affect the validity of such setoff and
application. The rights of the Administrative Agent, each Lender and each Issuer
under this Section 5.9 are in addition to other rights and remedies (including
other rights of setoff under Applicable Law or otherwise) which the
Administrative Agent or such Lender or such Issuer may have.
SECTION 5.10. USE OF PROCEEDS. The Borrower shall apply the proceeds of
each Borrowing only in accordance with Section 2.8; without limiting the
foregoing, no proceeds of any Loan will be used to acquire any equity security
of a class which is registered pursuant to Section 12 of the Securities Exchange
Act of 1934 or any "margin stock", as defined in F.R.S. Board Regulation U, X or
T; provided, however, the Borrower may own, and may use proceeds of the Loans to
acquire, "margin stock" (as such term is defined in F.R.S. Board Regulation U, X
or T) so long as the amount paid for such margin stock does not exceed the
lesser of (i) five percent (5%) of the Borrowing Base at the time of such
acquisition, and (ii) twenty-five percent (25%) (or such lesser percentage as
may be required by then Applicable Law) of the value of the Borrower's assets.
SECTION 5.11. CHANGE OF LENDER.
(a) Each Lender agrees that, upon the occurrence of any event
giving rise to the operation of Sections 4.8, 5.1, 5.3, 5.5 or 5.6 with
respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such
Lender) to designate another lending office for its Loan (provided that
such designation is made on such terms that such Lender and its lending
office suffer no economic, legal or regulatory disadvantage) with the
object of avoiding the consequence of the event giving rise to the
operation of any such section. Nothing in this subsection shall affect
or postpone any of the obligations of the Borrower or the right of any
Lender provided in Sections 4.8, 5.1, 5.3, 5.5 and 5.6.
(b) If any Lender elects to pass through to the Borrower any
charge or cost under Sections 4.8, 5.3, 5.5 or 5.6, and no Default
exists, the Borrower may elect to terminate such Lender as a party to
this Agreement; provided that, prior to or concurrently with such
termination, the Borrower must either (i) if the Administrative Agent
and each non-terminated Lender consent, pay to the terminated Lender
all principal, interest, fees, costs and other Obligations owed to such
Lender and accrued through the date of termination (including
reimbursement of any funding losses of the type described in Section
5.4 that are incurred because of such termination) and terminate such
Lender's Commitment, or (ii) arrange for one or more Eligible Assignees
to purchase the rights and duties of the terminated Lender pursuant to
Section 11.11.1, in
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which event the terminated Lender will assign all of such rights and
duties to such Eligible Assignees. Prior to arranging for any Person
other than an existing Lender to be such an Eligible Assignee, the
Borrower shall notify the other Lenders of its intention to replace the
terminated Lender and, during the sixty day period after such notice,
the other Lenders shall have a right of first refusal to purchase the
rights and duties of the terminated Lender, pro rata in accordance with
their respective Percentages.
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.1. INITIAL CREDIT EXTENSION. The obligation of each Lender
and each Issuer to make the initial Credit Extension shall be subject to the
prior or concurrent satisfaction of each of the conditions precedent set forth
in this Section 6.1.
SECTION 6.1.1. RESOLUTIONS, ETC. The Administrative Agent shall have
received from the Borrower a certificate, dated the date of the initial Credit
Extension, of the respective Secretary or Assistant Secretary of each of the
Borrower, Future California and the Partners, for themselves and on behalf of
the Partnership Subsidiaries, as to
(a) resolutions of the respective Boards of Directors of the
Borrower, Future California and the Partners then in full force and
effect authorizing the execution, delivery and performance of this
Agreement, the Notes and each other Loan Document to be executed by
each of them;
(b) the incumbency and signatures of those of its officers
authorized to act with respect to this Agreement, the Notes and each
other Loan Document executed by each of them;
(c) the Organic Documents of the Borrower, Future California,
the Partners and the Partnership Subsidiaries; and
(d) evidence that each of the Borrower, Future California, the
Partners and the Partnership Subsidiaries is in good standing under the
laws of the jurisdiction of its respective organization and, as to the
Future California and the Partnership Subsidiaries, each of the
jurisdictions where the Mortgaged Properties are located,
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upon which certificate the Administrative Agent, the Lenders and the Issuers may
conclusively rely until the Administrative Agent shall have received a further
certificate of the Secretary of the Borrower canceling or amending such prior
certificate.
SECTION 6.1.2. DELIVERY OF NOTES. The Administrative Agent shall have
received, for the account of each Lender, its Note duly executed and delivered
by the Borrower.
SECTION 6.1.3. GUARANTIES. The Administrative Agent shall have
received executed counterparts of the Guaranties, or ratifications or amendments
and restatements of Guaranties previously delivered under the Existing Credit
Agreement, dated as of the date hereof, duly executed by each of the Material
Subsidiaries.
SECTION 6.1.4. PLEDGE AGREEMENTS. The Administrative Agent shall have
received executed counterparts of the Pledge Agreements, or ratifications or
amendments and restatements of Pledge Agreements previously delivered under the
Existing Credit Agreement, dated as of the date hereof, duly executed by (a) the
Borrower pledging 100% of the Capital Stock of each of the Partners and Future
California, (b) each of the Partners, pledging all of its respective partnership
interests in each of the Partnership Subsidiaries, and (c) the Borrower and any
of its Subsidiaries, as applicable, pledging 65% of the Capital Stock or
partnership interests of each of the foreign Material Subsidiaries of the
Borrower or its Subsidiaries, together with the certificates, evidencing all of
the issued and outstanding shares of Capital Stock or partnership interests
pledged pursuant to the Pledge Agreements, which certificates shall in each case
be accompanied by undated stock powers duly executed in blank, or, if any
securities pledged pursuant to the Pledge Agreements are uncertificated
securities, confirmation and evidence satisfactory to the Administrative Agent
that the security interest in such uncertificated securities has been
transferred to and perfected by the Administrative Agent for the benefit of the
Lenders in accordance with Article 8 and/or Article 9 of the Uniform Commercial
Code, as in effect in the State of Texas, and, as applicable, with evidence of
completion (or satisfactory arrangement for the completion) of all filings and
recordings of the Pledge Agreements as may be necessary, or in the reasonable
opinion of the Administrative Agent, desirable, effectively to create a valid,
perfected first priority lien against and security interest in the collateral
covered thereby.
SECTION 6.1.5. SECURITY AGREEMENT. The Administrative Agent shall have
received executed counterparts of the Security Agreement, or ratifications or
amendments and restatements of Security Agreements previously delivered under
the Existing Credit Agreement, dated as of the date hereof, duly executed by the
Borrower and its Material Subsidiaries, together with
(a) executed copies of Uniform Commercial Code financing
statements or amendments to existing financing statements (Forms UCC-1
or UCC-2), in
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proper form for filing, naming the Borrower as the debtor and the
Administrative Agent as the secured party, or other similar instruments
or documents, filed under the Uniform Commercial Code of all
jurisdictions as may be necessary or, in the opinion of the
Administrative Agent, desirable to perfect the security interest of the
Administrative Agent pursuant to the Security Agreement;
(b) executed copies of proper Uniform Commercial Code Form
UCC-3 termination statements, if any, necessary to release all Liens
and other rights of any Person in any collateral described in the
Security Agreement previously granted by any Person together with such
other Uniform Commercial Code Form UCC-3 termination statements as the
Administrative Agent may reasonably request from the Borrower; and
(c) a Uniform Commercial Code Request for Information or
Copies (UCC Form 11) or similar search report certified by a party
acceptable to the Administrative Agent, dated a date reasonably near to
the date of the initial borrowing, listing all effective financing
statements which name the Borrower, its Subsidiaries and each other
Obligor (under their present names and any previous names) as the
debtor and which are filed in the jurisdictions in which filings were
made pursuant to clause (a) above, together with copies of such
financing statements (none of which shall cover any collateral
described in the Security Agreement), other than financing statements
in favor of Bank of America and financing statements previously
delivered to Bank of America.
SECTION 6.1.6. AMENDMENT TO EXISTING MORTGAGES. The Administrative
Agent shall have received counterparts of amendments or amendments and
restatements of the Existing Mortgages, adding the Obligations to the
obligations secured by the Existing Mortgages, dated as of a recent date, duly
executed by the Borrower and its Material Subsidiaries, as applicable.
SECTION 6.1.7. OPINIONS OF COUNSEL. The Administrative Agent shall have
received opinions, dated the date of the initial Credit Extension and addressed
to the Administrative Agent, the Issuer and all the Lenders, from
(a) Haynes and Boone, LLP, counsel to the Borrower and its
Subsidiaries, substantially in the form of Exhibit H hereto; and
(b) Title counsel listed on Schedule VI hereto, as to the
Mortgaged Properties listed on Schedule VI hereto, substantially in the
form of Exhibit I-1 hereto.
SECTION 6.1.8. UCC SEARCHES. The Administrative Agent shall have
received certified copies of Uniform Commercial Code Request for Information or
Copies (UCC Form 11) or similar search reports certified by a party acceptable
to the Administrative
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Agent, dated a date reasonably near to the date of the initial Credit Extension,
listing all effective financing statements which name the Borrower, its
Subsidiaries and each other Obligor (under their present names and any previous
names) as the debtor and which are filed in the jurisdictions in the States of
California, Texas, Oklahoma, New Mexico and Louisiana in which the Existing
Mortgages were filed and the New Mortgages will be filed, together with copies
of such financing statements (none of which shall cover any collateral described
in the Existing Mortgages or the New Mortgages) other than financing statements
in favor of Bank of America and financing statements previously delivered to
Bank of America and approved.
SECTION 6.1.9. EVIDENCE OF INSURANCE. The Administrative Agent shall
have received certificates of insurance satisfactory to it evidencing the
existence of all insurance required to be maintained by the Borrower by this
Agreement and the other Loan Documents.
SECTION 6.1.10. ENGINEERING REPORT. The Administrative Agent shall
have received an Engineering Report, dated as of January 1, 1999, from T.J.
Smith & Company, as to the Mortgaged Properties included in the initial
determination of the Borrowing Base.
SECTION 6.1.11. ENVIRONMENTAL REPORT AND QUESTIONNAIRE. The
Administrative Agent shall have received copies of existing Phase I
environmental assessments in the Borrower's possession with respect to the
Mortgaged Properties and completed and current environmental disclosure
questionnaires and such other information with respect to the ownership and past
use of the Mortgaged Properties included in the initial determination of the
Borrowing Base as the Administrative Agent and the Lenders may reasonably
request, and such reports and questionnaire shall be satisfactory in form,
substance and scope to the Administrative Agent and the Lenders.
SECTION 6.1.12. BUDGET. The Administrative Agent shall have received a
budget for the Borrower for the following twelve (12) month period, in form,
scope and detail reasonably satisfactory to the Administrative Agent and the
Required Lenders.
SECTION 6.1.13. FINANCIAL STATEMENTS. The Administrative Agent shall
have received a consolidated balance sheet, income and cash flow statements and
statement of stockholders' equity of the Borrower and its consolidated
Subsidiaries for the years 1997 and 1998, audited by PriceWaterhouseCoopers LLP
and prepared in accordance with GAAP.
SECTION 6.1.14. CONSENTS, ETC. The Administrative Agent shall have
received certified copies of all documents evidencing any necessary Consents and
Mortgage
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Consents in connection with this Agreement, all in form and substance reasonably
satisfactory to the Administrative Agent.
SECTION 6.1.15. SHAREHOLDER ACKNOWLEDGMENT. The Administrative Agent
shall have received duly executed counterparts of an acknowledgment and consent,
in form and substance satisfactory to the Administrative Agent, from the
Borrower and each Initial Holder to the effect that each of them acknowledges
and agrees that (a) the Restricted Payment Test under this Agreement requires
that, prior to making any Distribution Payment with respect to the Series B
Preferred, the Borrower must obtain the consent of all of the Lenders, and (b)
notwithstanding the terms of any agreement between such Initial Holder and the
Borrower, without the prior written consent of all of the Lenders, no redemption
of any of the Series B Preferred shall be requested, required or exercised so
long as any of the Obligations remain unpaid or unperformed.
SECTION 6.1.16. COMPLIANCE WITH REPRESENTATIONS AND WARRANTIES. The
Administrative Agent shall have received a certificate from an Authorized
Officer of the Borrower stating that all representations and warranties
contained in Article VII are true and correct in all material respects as of the
Effective Date.
SECTION 6.1.17. AMENDED SECURITY DOCUMENTS, ETC. The Administrative
Agent shall have received all documents, instruments and agreements amending,
supplementing or modifying the mortgages, security agreements, pledge
agreements, guaranties and other loan documents previously given under the
Existing Credit Agreement to provide that such documents, instruments and
agreements secure the Obligations, in each case pursuant to instruments in form
and substance satisfactory to the Administrative Agent and its counsel.
SECTION 6.1.18. CLOSING FEES, EXPENSES, ETC. The Administrative Agent
shall have received, for its own account, or for the account of each Lender, as
the case may be, all reasonable fees, costs and expenses due and payable
pursuant to Sections 3.3 and 11.3, if then invoiced.
SECTION 6.1.19. OTHER DOCUMENTS. The Administrative Agent and each
Lender shall have received such other instruments and documents as it may
reasonably request.
SECTION 6.2. INCLUSION OF HYDROCARBON INTERESTS IN THE BORROWING BASE.
The inclusion of any additional Hydrocarbon Interests in the Borrowing Base is
subject to the following conditions having been satisfied and receipt by the
Administrative Agent and the Required Lenders of the following documents, in
each case with respect to each Hydrocarbon Interests and related Oil and Gas
Properties which the Borrower requests be included in the Borrowing Base, each
of which conditions and documents shall be satisfactory to the Administrative
Agent and the Required Lenders in form and substance.
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SECTION 6.2.1. ENVIRONMENTAL REPORT AND QUESTIONNAIRE. The
Administrative Agent shall have received Phase I environmental assessments as of
a recent date prepared by an environmental consulting firm as shall be
acceptable to the Administrative Agent, a completed environmental disclosure
questionnaire and such other information with respect to the ownership and past
use of the Mortgaged Properties relating to such Hydrocarbon Interests as the
Administrative Agent and the Lenders may reasonably request, and such reports
and questionnaire shall be satisfactory in form, substance and scope to the
Administrative Agent and the Required Lenders.
SECTION 6.2.2. MORTGAGE. The Administrative Agent shall have received
counterparts of a Mortgage relating to such Hydrocarbon Interests and related
Oil and Gas Properties, dated as of a recent date, duly executed by the Borrower
and/or its Subsidiaries, as applicable, together with
(a) evidence of the completion (or satisfactory arrangements
for the completion) of all recordings and filings of the Mortgage as
may be necessary or, in the reasonable opinion of the Administrative
Agent, desirable effectively to create a valid, perfected first
priority Lien against the Properties purported to be covered thereby;
(b) favorable mortgagee's title opinions in favor of the
Administrative Agent (in form and substance and issued by title counsel
satisfactory to the Administrative Agent, substantially in the form of
Exhibit I-2 hereto), with respect to the Property purporting to be
covered by the Mortgage setting forth the working interest and net
revenue interest of the Borrower or its Subsidiary in such Properties
and opining that the Borrower's or such Subsidiary's title to such
property is good and marketable and valid and that the interests
created by the Mortgage constitute valid first Liens thereon free and
clear of all defects and encumbrances other than encumbrances permitted
by Section 8.2.3 or otherwise as approved by the Administrative Agent;
and
(c) such other approvals, opinions, or documents as the
Administrative Agent may reasonably request.
SECTION 6.2.3. UCC SEARCHES. The Administrative Agent shall have
received Uniform Commercial Code Requests for Information or Copies (UCC Form
11) or similar search reports certified by a party acceptable to the
Administrative Agent, dated as of a recent date, listing all effective financing
statements which name each Obligor (under its present name and any previous
names) pledging such additional Hydrocarbon Interests as the debtor and which
are filed in the jurisdictions in which a Mortgage is to be filed, together with
copies of such financing
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statements (none of which shall cover any collateral described in any such
Mortgage) other than financing statements in favor of Administrative Agent and
financing statements previously delivered to Administrative Agent and approved.
SECTION 6.2.4. EVIDENCE OF INSURANCE. The Administrative Agent shall
have received certificates of insurance satisfactory to it evidencing the
existence of all insurance required to be maintained by the Borrower by this
Agreement and the other Loan Documents with respect to the Hydrocarbon Interests
and related Oil and Gas Properties being added to the Borrowing Base.
SECTION 6.2.5. ENGINEERING REPORTS. The Administrative Agent and the
Lenders shall have received an Engineering Report, dated as of a recent date
from a petroleum engineer acceptable to the Administrative Agent, as to the
Hydrocarbon Interests being added to the Borrowing Base.
SECTION 6.2.6. MATERIAL CONTRACTS; SECURITY AGREEMENT. The
Administrative Agent shall have received true and correct copies, certified by
the Borrower, and approved the form and substance of, each Material Contract
related to the Hydrocarbon Interests being added to the Borrowing Base. Further,
if requested, the Administrative Agent shall have received duly executed
counterparts of a Security Agreement, or, if applicable, amendments to an
existing Security Agreement, providing that such Material Contracts shall be
collateral for the Obligations (and if requested, such Material Contracts shall
by their terms be assignable to the Administrative Agent as collateral for the
Obligations) and all required Consents and Mortgage Consents.
SECTION 6.2.7. GUARANTIES. The Administrative Agent shall have
received duly executed counterparts of a Guaranty from any Material Subsidiary
of the Borrower which is adding Hydrocarbon Interests to the Borrowing Base,
unless such a Guaranty has already been obtained in connection with a previous
addition to the Borrowing Base.
SECTION 6.2.8. PLEDGE AGREEMENT. The Administrative Agent shall have
received duly executed counterparts of a Pledge Agreement from the Borrower or
any of its Subsidiaries pledging the Capital Stock or partnership interests of
each Material Subsidiary that is acquiring or owns Hydrocarbon Interests being
added to the Borrowing Base, unless such a Pledge Agreement has already been
obtained, accompanied by the original share certificate evidencing such Capital
Stock or partnership interests and executed stock powers (in blank) and the
evidence of satisfactory arrangement for the completion of all filings and
recordings of the Pledge Agreement as may be necessary or, in the reasonable
opinion of the Lender, desirable, effectively to create a valid, perfected first
priority lien against and security interest in the collateral covered thereby.
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SECTION 6.2.9. OTHER DOCUMENTS. The Administrative Agent shall have
received such other instruments and documents as it may reasonably request,
including pursuant to Section 8.1.7.
SECTION 6.3. ALL CREDIT EXTENSIONS. The obligation of each Lender to
make any Credit Extension (including the initial Credit Extension) shall be
subject to the satisfaction of each of the conditions precedent set forth in
this Section 6.3.
SECTION 6.3.1. COMPLIANCE WITH WARRANTIES, NO DEFAULT, ETC. Both
before and after giving effect to any Credit Extension (but, if any Default of
the nature referred to in Section 9.1.5 shall have occurred with respect to any
other Indebtedness, without giving effect to the application, directly or
indirectly, of the proceeds of any Borrowing) the following statements shall be
true and correct
(a) the representations and warranties set forth in Article
VII (excluding, however, those contained in Section 7.9) shall be true
and correct in all material respects with the same effect as if then
made (unless stated to relate solely to an earlier date, in which case
such representations and warranties shall be true and correct as of
such earlier date);
(b) except as disclosed by the Borrower to the Administrative
Agent and the Lenders pursuant to Section 7.9
(i) no labor controversy, litigation, arbitration or
governmental investigation or proceeding shall be pending or,
to the knowledge of the Borrower, threatened against the
Borrower or any of its Subsidiaries which has or might
reasonably be expected to have a Material Adverse Effect; and
(ii) no development shall have occurred in any labor
controversy, litigation, arbitration or governmental
investigation or proceeding disclosed pursuant to Section 7.9
which has or might reasonably be expected to have a Material
Adverse Effect; and
(c) no Default shall have then occurred and be continuing, and
neither the Borrower nor any other Obligor shall be in material
violation of any Applicable Law or court order or decree if such
violation has or might reasonably be expected to have a Material
Adverse Effect.
SECTION 6.3.2. CREDIT REQUEST. The Administrative Agent shall have
received a Borrowing Request or Issuance Request, as the case may be, for such
Credit Extension. Each of the delivery of a Borrowing Request or an Issuance
Request and the acceptance by the Borrower of the proceeds of the Borrowing or
the issuance of the Letter of Credit as applicable, shall constitute a
representation and warranty by
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the Borrower that on the date of such Borrowing (both immediately before and
after giving effect to such Borrowing and the application of the proceeds
thereof) or the issuance of the Letter of Credit, as applicable, the statements
made in Section 6.3.1 are true and correct.
SECTION 6.3.3. SATISFACTORY LEGAL FORM. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries shall be reasonably satisfactory in form and substance to the
Administrative Agent and its counsel; the Administrative Agent and its counsel
shall have received all information, approvals, opinions, documents or
instruments as the Administrative Agent or its counsel may reasonably request.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
In order to induce the Administrative Agent, each Issuer and each
Lender to enter into this Agreement and to make Loans and to issue Letters of
Credit hereunder, the Borrower represents and warrants unto the Administrative
Agent, each Issuer and each Lender as set forth in this Article VII.
SECTION 7.1. ORGANIZATION, ETC. The Borrower is a Texas corporation and
each of its Subsidiaries is a corporation or limited partnership, validly
organized and existing and in good standing under the laws of the jurisdiction
of its organization, is duly qualified to do business and is in good standing as
a foreign corporation or limited partnership, as the case may be, in each
jurisdiction where the nature of its business requires such qualification, and
has full power and authority and holds all requisite Approvals to enter into and
perform its Obligations under this Agreement, the Notes and each other Loan
Document to which it is a party and to own and hold under lease its Property and
to conduct its business substantially as currently conducted by it (other than
where failure to be so qualified or in good standing or failure to hold such
licenses, permits and other approvals would not reasonably be expected to have a
Material Adverse Effect). On the Effective Date, the Principal Shareholders own,
on a fully diluted basis, not less than 63% of the issued and outstanding shares
of the Capital Stock of the Borrower. The Initial Holders own all of the Series
B Preferred. Other than the Series B Preferred, no holder of any of the Capital
Stock of the Borrower is entitled to receive any Distribution Payment as a
matter of right, and all Distribution Payments to all shareholders of the
Borrower (other than the holders of Series B Preferred) may be made or not at
the discretion of the Borrower. The Borrower is the sole shareholder of Future
California and each of the Partners. The Partners are the sole partners of the
Partnership Subsidiaries. On the Effective Date, the Borrower has no
Subsidiaries other than those listed in Schedule II.
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SECTION 7.2. DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution,
delivery and performance by the Borrower and each other Obligor of this
Agreement, the Notes and each other Loan Document executed or to be executed by
it are within the Borrower's and each such Obligor's corporate (or partnership
or other, as the case may be) powers, have been duly authorized by all necessary
corporate (or partnership or other, as the case may be) action, and do not
(a) contravene the Borrower's or such Obligor's Organic
Documents;
(b) contravene or result in any violation of or default under
any Applicable Law or any contractual restriction, court decree or
order, in each case binding on or affecting the Borrower or any other
Obligor or any of their respective Properties, businesses, assets or
revenues, including the Certificate of Designations of Cumulative
Redeemable Preferred Stock, Series B issued by the Borrower, the
Shareholders' Agreement or the Stock Purchase Agreement; or
(c) result in, or require the creation or imposition of, any
Lien on (except for the Liens of the Loan Documents) any of the
Borrower's or any other Obligor's respective Properties, businesses,
assets or revenues.
SECTION 7.3. GOVERNMENT APPROVAL, REGULATION, ETC. No authorization
or approval or other action by, and no notice to or filing with, any Government
Agency or other Person is required for the due execution, delivery or
performance by the Borrower or any other Obligor of this Agreement, the Notes or
any other Loan Document to which it is a party.
SECTION 7.4. INVESTMENT COMPANY ACT. Neither the Borrower nor any of
its Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
SECTION 7.5. PUBLIC UTILITY HOLDING COMPANY ACT. Neither the Borrower
nor any of its Subsidiaries is a "holding company" or a "subsidiary company" of
a "holding company", or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
SECTION 7.6. VALIDITY, ETC. This Agreement constitutes, and the Notes
and each other Loan Document executed by the Borrower or any of its Subsidiaries
will, on the due execution and delivery thereof, constitute, the legal, valid
and binding obligations of the Borrower or such Subsidiaries, as applicable,
enforceable in accordance with their respective terms, and each Loan Document
executed pursuant hereto by each other Obligor will, on the due execution and
delivery thereof by such Obligor, be the legal, valid and binding obligation of
such Obligor enforceable in
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accordance with its terms, in each case subject to the effect of any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally.
SECTION 7.7. FINANCIAL INFORMATION. Each of (i) the audited
consolidated balance sheet of the Borrower and each of its consolidated
Subsidiaries as at December 31, 1998, and the related consolidated audited
statements of operations and cash flow of the Borrower and such Subsidiaries,
and (ii) the unaudited consolidated balance sheet of the Borrower and each of
its consolidated Subsidiaries as at June 30, 1999, and the related consolidated
unaudited statements of operations and cash flow of the Borrower and such
Subsidiaries, copies of which have been furnished to the Administrative Agent
and each Lender, have been prepared in accordance with GAAP consistently
applied, and present fairly the consolidated financial condition of the
partnerships and corporations covered thereby as at the date thereof and the
results of their audited operations for the period then ended.
SECTION 7.8. NO MATERIAL ADVERSE CHANGE. Since the date of the
audited financial statements described in Section 7.7, there has been no change
in the financial condition, operations, assets, business, Properties or
prospects of the Borrower or its Subsidiaries that has or might reasonably be
expected to have a Material Adverse Effect. As at June 30, 1999, the Tangible
Net Worth of the Borrower and its consolidated Subsidiaries was not less than
$52,440,614.
SECTION 7.9. LITIGATION, LABOR CONTROVERSIES, ETC. There is no
pending or, to the knowledge of the Borrower, threatened litigation, action,
proceeding, or labor controversy affecting the Borrower or any of its
Subsidiaries, or any of their respective Properties, businesses, assets or
revenues, which has or might reasonably be expected to have a Material Adverse
Effect, except as disclosed in Item 7.9 ("Litigation") of the Disclosure
Schedule.
SECTION 7.10. OWNERSHIP OF PROPERTIES. The Borrower and each of its
Subsidiaries has good and marketable title to its Properties (including, without
limitation, all Hydrocarbon Interests), free and clear of all Liens except (a)
those referred to in the financial statements referred to in Section 7.7, (b) as
disclosed to the Lenders in the Disclosure Schedule or (c) as permitted by
Section 8.2.3. After giving full effect to all Liens permitted under Section
8.2.3, the Borrower and its Subsidiaries own the net interests in Hydrocarbons
produced from the Oil and Gas Properties as reflected in the most recent
Engineering Report, and neither the Borrower nor any of its Subsidiaries is
obligated to bear costs or expenses in respect of the Oil and Gas Properties in
excess of its working interest percentage as reflected in the most recent
Engineering Report. The Administrative Agent has received currently effective,
duly executed Mortgages and other Loan Documents encumbering Oil and Gas
Properties constituting at least 90% of the amount of Proven Reserves to which
value is given in the determination of the current Borrowing Base.
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SECTION 7.11. TAXES. The Borrower and each of its Subsidiaries has
filed all tax returns and reports required by Applicable Law to have been filed
by it and has paid all taxes and governmental charges thereby shown to be owing,
except any such taxes or charges which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books.
SECTION 7.12. PENSION AND WELFARE PLANS. During the
twelve-consecutive-month period prior to the Effective Date and prior to the
date of any Borrowing hereunder, no steps have been taken to terminate any
Pension Plan, and no contribution failure has occurred with respect to any
Pension Plan sufficient to give rise to a Lien under section 302(f) of ERISA. No
condition exists or event or transaction has occurred with respect to any
Pension Plan which might result in the incurrence by the Borrower or any member
of the Controlled Group of any material liability, fine or penalty. Except as
disclosed in Item 7.12 ("Employee Benefit Plans") of the Disclosure Schedule,
neither the Borrower nor any member of the Controlled Group has any contingent
liability with respect to any post-retirement benefit under a Welfare Plan,
other than liability for continuation coverage described in Part 6 of Title I of
ERISA.
SECTION 7.13. COMPLIANCE WITH LAW. Neither the Borrower nor any of
its Subsidiaries (a) is in violation of any Applicable Law of, or the terms of
any Approval issued by, any Government Agency; or (b) has failed to obtain any
Approval necessary to ownership of any of their respective Properties or the
conduct of their respective business (including without limitation any such
authorization from the Federal Energy Regulatory Commission, the Minerals
Management Service or any state conservation commission or similar body); which
violation or failure could reasonably be expected to have a Material Adverse
Effect.
SECTION 7.14. CLAIMS AND LIABILITIES. Except as disclosed to the
Lenders in Item 7.14 ("Claims and Liabilities") of the Disclosure Schedule,
neither the Borrower nor any of its Subsidiaries has accrued any liabilities
under gas purchase contracts for gas not taken, but for which it is liable to
pay if not made up and which, if not paid, would have a Material Adverse Effect.
Except as disclosed to the Lenders in Item 7.14 of the Disclosure Schedule, no
claims exist against the Borrower or any of its Subsidiaries for gas imbalances
which claims if adversely determined would have a Material Adverse Effect. No
purchaser of product supplied by the Borrower or any of its Subsidiaries has any
claim against the Borrower or any of its Subsidiaries for product paid for, but
for which delivery was not taken as and when paid for, which claim if adversely
determined would have a Material Adverse Effect.
SECTION 7.15. NO PROHIBITION ON PERFECTION OF SECURITY DOCUMENTS. None
of the terms or provisions of any indenture, mortgage, deed of trust, agreement
or other instrument to which the Borrower or any of its Subsidiaries is a party
or by which the
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Borrower or any of its Subsidiaries or the property of the Borrower or any of
its Subsidiaries is bound prohibit the filing or recordation of any of the Loan
Documents or any other action which is necessary or appropriate in connection
with the perfection of the Liens evidenced and created by any of the Loan
Documents.
SECTION 7.16. SOLVENCY. Neither the Borrower nor any of its
Subsidiaries is "insolvent", as such term is used and defined in the United
States Bankruptcy Code, 11 U.S.C. Section 101, et seq.
SECTION 7.17. ENVIRONMENTAL WARRANTIES. As a reasonable and prudent
operator of oil and gas producing properties, in the ordinary course of its
business, the Borrower has conducted, with respect to its existing Oil and Gas
Properties, and, on an ongoing basis, conducts a review of the effect of
Environmental Laws on business, operations and properties of the Borrower and
its Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including any capital or operating expenditures required
for Remedial Action or other clean-up or closure of Properties presently owned
or operated, any capital or operating expenditures required for Remedial Action
or otherwise to achieve or maintain compliance with environmental protection
standards imposed by Environmental Law or as a condition of any Approval or
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat and any actual or potential
liabilities to third parties, including employees, and any related costs and
expenses). On the basis of this review, the Borrower has reasonably concluded
that, except as disclosed in Item 7.17 ("Environmental Matters") of the
Disclosure Schedule, to the best of its knowledge after due inquiry:
(a) all facilities and Property (including underlying
groundwater) owned, leased or operated by the Borrower or any of its
Subsidiaries have been, and continue to be, owned, leased or operated
by the Borrower and its Subsidiaries in material compliance with all
Environmental Laws;
(b) there have been no past, and there are no pending or
threatened
(i) claims, complaints, notices or inquiries to, or
requests for information received by, the Borrower or any of
its Subsidiaries with respect to any alleged violation of any
Environmental Law, that, singly or in the aggregate, have or
may reasonably be expected to have a Material Adverse Effect,
or
(ii) claims, complaints, notices or inquiries to, or
requests for information received by, the Borrower or any of
its Subsidiaries regarding potential liability under any
Environmental Law or under any common law theories relating to
operations or the condition of any facilities or
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Property (including underlying groundwater) owned, leased or
operated by the Borrower or any of its Subsidiaries that,
singly or in the aggregate, have, or may reasonably be
expected to have a Material Adverse Effect;
(c) there have been no Releases of Hazardous Materials at, on
or under any Property now or previously owned or leased by the Borrower
or any of its Subsidiaries that, singly or in the aggregate, have, or
may reasonably be expected to have, a Material Adverse Effect;
(d) each of the Borrower or any of its Subsidiaries has been
issued and is in compliance with all Approvals relating to
environmental matters and necessary or desirable for its business
(other than where failure to so obtain or be in compliance with such
Approvals and other Approvals would not reasonably be expected to
result in a Material Adverse Effect);
(e) no Property now or previously owned, leased or operated by
the Borrower or any of its Subsidiaries is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, or, to the
extent that such listing may, singly or in the aggregate, have, or may
reasonably be expected to have a Material Adverse Effect, on the
CERCLIS or on any other federal or state list of sites requiring
investigation or clean-up;
(f) there are no underground storage tanks, active or
abandoned, including petroleum storage tanks, on or under any Property
now or previously owned, leased or operated by the Borrower or any of
its Subsidiaries that, singly or in the aggregate, have, or may
reasonably be expected to have, a Material Adverse Effect;
(g) neither the Borrower nor any Subsidiary of the Borrower
has directly transported or directly arranged for the transportation of
any Hazardous Material to any location which is listed or proposed for
listing on the National Priorities List pursuant to CERCLA, or, to the
extent that such listing may, singly or in the aggregate, have, or may
reasonably be expected to have a Material Adverse Effect, on the
CERCLIS or on any federal or state list or which is the subject of
federal, state or local enforcement actions or other investigations
which may lead to material claims against the Borrower or such
Subsidiary for any remedial work, damage to natural resources or
personal injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls, radioactive
materials or friable asbestos present at any Property now or previously
owned or leased by the Borrower or any of its Subsidiaries that, singly
or in the aggregate, have, or may reasonably be expected to have, a
Material Adverse Effect; and
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(i) no condition exists at, on or under any property now or
previously owned or leased by the Borrower or any of its Subsidiaries
which, with the passage of time, or the giving of notice or both, would
give rise to material liability under any Environmental Law that,
singly or in the aggregate have, or may reasonably be expected to have
a Material Adverse Effect.
SECTION 7.18. REGULATIONS T, U AND X. Neither the Borrower nor any of
its Subsidiaries is engaged in the business of extending credit for the purpose
of purchasing or carrying margin stock, and no proceeds of any Loans will be
used for a purpose which violates, or would be inconsistent with, F.R.S. Board
Regulation T, U or X, so long as the amount paid for such margin stock does not
exceed the lesser of (i) five-percent (5%) of the Borrowing Base at the time of
such acquisition, and (ii) twenty-five percent (25%) (or such lesser percentage
as may be required by then Applicable Law) of the value of the Borrower's
assets. Terms for which meanings are provided in F.R.S. Board Regulation T, U or
X or any regulations substituted therefor, as from time to time in effect, are
used in this Section with such meanings.
SECTION 7.19. INSURANCE. The Borrower and its Subsidiaries have the
benefit of the insurance coverage described in the certificates of insurance
delivered pursuant to Section 6.1.9 and required to be maintained pursuant to
Section 8.1.4.
SECTION 7.20. YEAR 2000 COMPLIANCE.
(a) The Borrower has (i) initiated a review and assessment of
all areas within its and each of its Subsidiaries' business and
operations (including those affected by suppliers and vendors) that
could be adversely affected by the "Year 2000 Problem" (that is, the
risk that computer applications (as well as imbedded microchips) used
by the Borrower or any of its Subsidiaries (or its suppliers and
vendors) may be unable to recognize and perform properly date-sensitive
functions involving certain dates prior to and any date after December
31, 1999), (ii) developed a plan and time line for addressing the Year
2000 Problem on a timely basis, and (iii) to date, implemented that
plan in accordance with that timetable.
(b) The Borrower reasonably believes that all computer
applications (including those of its and its Subsidiaries' suppliers
and vendors) that are material to its or any of its Subsidiaries'
business and operations will on a timely basis be able to perform
properly date-sensitive functions for all dates before and after
January 1, 2000 (that is, be "Year 2000 Compliant"), except to the
extent that a failure to do so could not reasonably be expected to have
Material Adverse Effect.
SECTION 7.21. ACCURACY OF INFORMATION. All factual information
heretofore or contemporaneously furnished by or on behalf of the Borrower or any
of its Subsidiaries in writing to the Administrative Agent, the Issuers or the
Lenders for purposes of or
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in connection with this Agreement or any transaction contemplated hereby
(including without limitation each Engineering Report) is, and all other such
factual information hereafter furnished by or on behalf of the Borrower to the
Administrative Agent, the Issuers or the Lenders will be, true and accurate in
every material respect on the date as of which such information is dated or
certified and as of the date of execution and delivery of this Agreement by the
Lenders, and such information is not, or shall not be, as the case may be,
incomplete by omitting to state any material fact necessary to make such
information not misleading. It is understood and agreed, however, that (i) each
Engineering Report is necessarily based upon economic assumptions and
professional opinions, estimates, and projections, (ii) any financial projection
which the Borrower or any of the Borrower's representatives has provided or may
provide in connection with the transactions contemplated hereby (the
"Projections") are similarly based on economic assumptions, opinions and
estimates, (iii) the Borrower makes no representation or warranty that such
assumptions, opinions, estimates and projections will ultimately prove to have
been accurate, (iv) the Borrower makes no representation or warranty with
respect to any price or cost projections furnished by the Administrative Agent
or any Lender for use in preparing any Engineering Report, and (v) no
representation or warranty is made with respect to the extent or value of any
Hydrocarbon Interests to which no Proven Reserves are attributed, so long as
such Hydrocarbon Interests are not shown in or covered by any Engineering Report
as constituting Proven Reserves; provided that, notwithstanding the foregoing
limitations concerning Projections, the Borrower represents and warrants, with
respect to all Projections that have been or will be provided by the Borrower or
any of its representatives or Subsidiaries, that such Projections have been or
will be, as the case may be, prepared in good faith based upon assumptions that
Borrower's management believed or believes, as the case may be, to be reasonable
at the time such Projections were or are prepared and that the factual
information furnished by the Borrower or any of its Subsidiaries to the
engineers and others who prepared such Projections was true and correct in all
material respects.
ARTICLE VIII
COVENANTS
SECTION 8.1. AFFIRMATIVE COVENANTS. The Borrower agrees with the
Administrative Agent, each Lender and each Issuer that, until all Commitments
have terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 8.1.
SECTION 8.1.1. FINANCIAL INFORMATION, REPORTS, NOTICES, ETC. The
Borrower will furnish, or will cause to be furnished, to the Administrative
Agent and each Lender copies of the following financial statements, reports,
notices and information:
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(a) as soon as available and in any event within forty-five
(45) days after the end of each of the first three Fiscal Quarters of
each Fiscal Year of the Borrower, consolidated and consolidating
balance sheets of the Borrower and its consolidated Subsidiaries as of
the end of such Fiscal Quarter and consolidated and consolidating
statements of operations and cash flow of the Borrower and its
consolidated Subsidiaries for such Fiscal Quarter and for the period
commencing at the end of the previous Fiscal Year and ending with the
end of such Fiscal Quarter, certified by the chief financial Authorized
Officer of the Borrower;
(b) as soon as available and in any event within ninety (90)
days after the end of each Fiscal Year of the Borrower, a copy of the
annual audit report for such Fiscal Year for the Borrower and its
consolidated Subsidiaries, including therein the consolidated balance
sheets of the Borrower as of the end of such Fiscal Year and statements
of operations and cash flow of the Borrower and its consolidated
Subsidiaries for such Fiscal Year, in each case certified (without any
Impermissible Qualification) in a manner reasonably acceptable to the
Administrative Agent by PriceWaterhouseCoopers L.L.P. or an independent
public accountant acceptable to the Administrative Agent and the
Required Lenders, together with a report from such accountants
containing a computation of, and showing compliance with, each of the
financial ratios and restrictions contained in Section 8.2.4 and to the
effect that, in making the examination necessary for the signing of
such annual report by such accountants, they have not become aware of
any Default that has occurred and is continuing or, if they have become
aware of such Default, describing such Default and the steps, if any,
being taken to cure it;
(c) concurrently with the delivery of the financial statements
referred to in clauses (a) and (b), a certificate, executed by the
chief financial Authorized Officer of the Borrower, showing (in
reasonable detail and with appropriate calculations and computations in
all respects reasonably satisfactory to the Administrative Agent)
compliance with the financial covenants set forth in Section 8.2.4 and
also certifying, to such Authorized Officer's best knowledge, that no
Default has occurred and is then outstanding;
(d) on or prior to December 31st of each calendar year, annual
financial budget for the Borrower and its Subsidiaries for the
following calendar year, in form, scope and detail reasonably
satisfactory to the Administrative Agent and the Required Lenders;
(e) upon request of the Administrative Agent, on or prior to
December 31st of each calendar year, a capital budget for the Borrower
and its Subsidiaries for the following calendar year, in form, scope
and detail reasonably satisfactory to the Administrative Agent and the
Required Lenders;
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(f) as soon as possible and in any event within three (3)
Business Days after the Borrower knows (or, in the exercise of
reasonable diligence, should have known) of the occurrence of each
Default and any event which has or is reasonably likely to have a
Material Adverse Effect, a statement of the chief financial Authorized
Officer of the Borrower setting forth details of such Default or event
and the action which the Borrower has taken and proposes to take with
respect thereto;
(g) as soon as possible and in any event within three (3)
Business Days after (x) the occurrence of any adverse development with
respect to any litigation, action, proceeding or labor controversy
described in Section 7.9 or (y) the commencement of any litigation,
action, proceeding or labor controversy of the type described in
Section 7.9, notice thereof and copies of all documentation relating
thereto;
(h) as soon as possible and in any event within ten (10) days
after any responsible officer of the Borrower has actual knowledge
thereof, notice of
(i) any claim by any Person against the Borrower or
any of its Subsidiaries of nonpayment of, or
(ii) any attempt by any Person to collect upon or
enforce any accounts payable of the Borrower or any of its
Subsidiaries, in the case of any single account payable in
excess of $250,000, or in the case of all accounts payable in
the aggregate in excess of $500,000;
(i) upon, but in no event later than ten (10) days after, any
responsible officer of the Borrower or any of its Subsidiaries becomes
aware of (i) any and all enforcement, cleanup, removal or other
governmental or regulatory actions instituted, completed or threatened
or other environmental claims against the Borrower or any Subsidiary or
any of its Properties pursuant to any applicable Environmental Laws
which could have a Material Adverse Effect, and (ii) any environmental
or similar condition on any real property adjoining or in the vicinity
of the property of the Borrower or any Subsidiary that could reasonably
be anticipated to cause such property or any part thereof to be subject
to any restrictions on the ownership, occupancy, transferability or use
of such property under any Environmental Laws;
(j) as soon as available and in any event within sixty (60)
days after January 1st of each calendar year, an Engineering Report
from an independent petroleum engineering firm acceptable to the
Administrative Agent, and as soon as available and in any event within
sixty (60) days after July 1st of each calendar year, an Engineering
Report prepared by a reserve engineer employed by the Borrower, unless
the Administrative Agent, at least sixty (60) days
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before the required delivery date of such Engineering Report, has
requested that it be prepared by an independent petroleum engineering
firm reasonably acceptable to the Administrative Agent;
(k) promptly after (i) the sending or filing thereof, copies
of all periodic and other reports distributed by the Borrower to its
shareholders generally, (ii) the sending or filing thereof, all reports
and registration statements which the Borrower or any of its
Subsidiaries files with the Securities and Exchange Commission or any
national securities exchange, (iii) the filing thereof, copies of all
tariff and rate cases and other material reports filed with any
regulatory authority, and (iv) receipt thereof, copies of all notices
received from any regulatory authority concerning noncompliance by the
Borrower or any of its Subsidiaries with any applicable regulations;
(l) immediately upon becoming aware of the institution of any
steps by the Borrower or any other Person to terminate any Pension
Plan, or the failure to make a required contribution to any Pension
Plan if such failure is sufficient to give rise to a Lien under section
302(f) of ERISA, or the taking of any action with respect to a Pension
Plan which could result in the requirement that the Borrower furnish a
bond (other than customary fidelity bonds under section 412 of ERISA)
or other security to the PBGC or such Pension Plan, or the occurrence
of any event with respect to any Pension Plan which could result in the
incurrence by the Borrower of any material liability, fine or penalty,
or any material increase in the contingent liability of the Borrower
with respect to any post-retirement Welfare Plan benefit, notice
thereof and copies of all documentation relating thereto;
(m) promptly after the Borrower discovers or determines that
any computer application (including those of its suppliers or vendors)
that is material to the businesses or operations of the Borrower and
its Subsidiaries taken as a whole will not be Year 2000 Compliant on a
timely basis, notice thereof and a copy of the Borrower's plan for
dealing with such problem, except to the extent such failure could not
reasonably be expected to have a Material Adverse Effect; and
(n) such other information respecting the condition or
operations, financial or otherwise, of the Borrower or any of its
Subsidiaries as any Lender through the Administrative Agent may from
time to time reasonably request.
SECTION 8.1.2. COMPLIANCE WITH LAWS, ETC. The Borrower will, and
will cause each of its Subsidiaries to, comply in all respects with all
Applicable Laws, (except where the failure to so comply would not reasonably be
expected to result in a Material Adverse Effect), such compliance to include
(without limitation):
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(a) the maintenance and preservation of its existence, and
qualification as a foreign entity, other than the failure to maintain,
preserve or qualify a non-Material Subsidiary which would not
reasonably be expected to have a Material Adverse Effect; provided that
nothing in this Section shall prohibit mergers permitted under Section
8.2.8, or the termination of the existence of a Subsidiary (other than
a Material Subsidiary) if the Borrower in good faith determines that
such termination is in the best interest of the Borrower; and
(b) the payment, before the same become delinquent, of all
taxes, assessments and governmental charges imposed upon it or upon its
property except to the extent being diligently contested in good faith
by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.
SECTION 8.1.3. MAINTENANCE AND DEVELOPMENT OF PROPERTIES. The
Borrower will, and will cause each of its Subsidiaries to, maintain, preserve,
protect and keep its Properties in good repair, working order and condition
(ordinary wear and tear excepted), and make necessary and proper repairs,
renewals and replacements so that its business carried on in connection
therewith may be properly conducted at all times in accordance with standard
industry practices. In particular, the Borrower will, and will cause each of its
Subsidiaries to, operate or cause to be operated its Oil and Gas Properties as a
reasonable and prudent operator. The Borrower shall use its reasonable best
efforts to develop and bring into production in a prudent and businesslike
manner all proved developed non-producing reserves that the Required Lenders
have considered in their determination of the Borrowing Base.
SECTION 8.1.4. INSURANCE. The Borrower will, and will cause each of
its Subsidiaries to, maintain or cause to be maintained with responsible
insurance companies insurance with respect to its properties and business
against such casualties and contingencies and of such types and in such amounts
as is customary in the case of similar businesses (including, where appropriate,
well control, operator's extra expense and remediation insurance) and will
furnish to the Administrative Agent, on or before December 31st each year, and,
at the Administrative Agent's request, at other reasonable intervals, a
certificate of an Authorized Officer of the Borrower setting forth the nature
and extent of all insurance maintained by the Borrower and its Subsidiaries in
accordance with this Section. The following shall apply to the insurance
required by this Section 8.1.4:
(a) Each policy for property insurance covering the Mortgaged
Property shall show the Administrative Agent as loss payee;
(b) Each policy for liability insurance covering the Mortgaged
Property shall show the Administrative Agent, the Lenders and the
Issuers as additional insured;
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(c) Each insurance policy covering the Mortgaged Property
shall provide that at least thirty (30) days prior written notice of
cancellation, reduction in amount or other change in coverage, or of
lapse shall be given to the Administrative Agent by the insurer; and
(d) The Borrower shall, if so requested by the Administrative
Agent, deliver to the Administrative Agent the original or a certified
copy of each insurance policy covering the Mortgaged Property.
SECTION 8.1.5. BOOKS AND RECORDS. The Borrower will, and will cause
each of its Subsidiaries to, keep books and records which accurately reflect all
of its material business affairs and transactions and permit the Administrative
Agent, each Issuer and each Lender or any of their respective representatives,
at reasonable times and intervals, to visit all of its offices, to discuss its
financial matters with its officers and, upon forty-eight (48) hours prior
notice to the Borrower, with the Borrower's independent public accountant (and
the Borrower hereby authorizes such independent public accountant to discuss the
Borrower's and its Subsidiaries' financial matters with the Administrative
Agent, the Issuers and the Lenders or their representatives whether or not any
representative of the Borrower is present) and to examine (and, at the expense
of the Borrower, photocopy extracts from) any of its books or other corporate
records. The Borrower shall pay any reasonable fees of such independent public
accountant incurred in connection with the Administrative Agent's or any
Issuer's or any Lender's exercise of their rights pursuant to this Section.
Furthermore, the Borrower will permit the Administrative Agent, or its agents,
at the cost and expense of the Borrower, to enter upon the Oil and Gas
Properties and all parts thereof, for the purpose of investigating and
inspecting the condition and operation thereof, and shall permit reasonable
access to the field offices and other offices, including the principal place of
business, of the Borrower to inspect and examine the Oil and Gas Properties.
SECTION 8.1.6. ENVIRONMENTAL COVENANT. The Borrower will, and will
cause each of its Subsidiaries to,
(a) use, operate and maintain all of its facilities and
Properties in material compliance with all Environmental Laws, keep all
necessary Approvals relating to environmental matters in effect and
remain in material compliance therewith, and handle all Hazardous
Materials in material compliance with all applicable Environmental
Laws;
(b) (i) immediately notify the Administrative Agent and
provide copies upon receipt of all written claims, complaints, notices
or inquiries relating to the condition of its facilities and Properties
or compliance with Environmental Laws, (ii) use all reasonable efforts
to have dismissed with prejudice any actions or proceedings relating to
compliance with Environmental Laws which would reasonably be expected
to have a Material Adverse Effect, and (iii) diligently
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pursue cure of any material underlying environmental problem which
forms the basis of any such claim, complaint, notice or inquiry; and
(c) provide such information and certifications which the
Administrative Agent may reasonably request from time to time to
evidence compliance with this Section 8.1.6.
SECTION 8.1.7. FURTHER ASSURANCES.
(a) The Borrower shall, and shall cause each of its
Subsidiaries, upon the request of the Administrative Agent, to take
such actions and to execute and deliver such documents and instruments
as the Administrative Agent shall require to ensure that the
Administrative Agent shall, at all times, have received currently
effective, duly executed Loan Documents encumbering Oil and Gas
Properties of the Borrower or any of its Subsidiaries not then subject
to a Mortgage constituting 90% of the Proven Reserves to which value
has been given in the then current Borrowing Base and satisfactory
title evidence in form and substance reasonably acceptable to the
Administrative Agent, in its reasonable business judgment, as to
ownership of such Oil and Gas Properties; provided that, upon thirty
(30) days notice to the Borrower, the Administrative Agent may require,
and the Borrower and/or its Subsidiaries, as applicable, shall execute,
acknowledge and deliver to the Administrative Agent, Mortgages
effectively encumbering 100% of the Oil and Gas Properties of the
Borrower and its Subsidiaries to which value is given in the
determination of the then current Borrowing Base.
(b) If the Administrative Agent shall determine that, as of
the date of any Borrowing Base Redetermination, the Borrower shall have
failed to comply with the preceding Subsection (a), the Administrative
Agent may (and, at the direction of the Required Lenders, shall) notify
the Borrower in writing of such failure and, within thirty (30) days
from and after receipt of such written notice by the Borrower, the
Borrower and its Subsidiaries, as applicable, shall execute and deliver
to the Administrative Agent supplemental or additional Loan Documents,
in form and substance satisfactory to the Administrative Agent and its
counsel, securing payment of the Notes and the other Obligations and
covering additional assets not then encumbered by any Loan Documents
(together with current valuations, Engineering Reports, and title
evidence applicable to the additional assets collaterally assigned,
each of which shall be in form and substance satisfactory to the
Administrative Agent) such that the Administrative Agent shall have
received currently effective duly executed Loan Documents encumbering
Oil and Gas Properties constituting at least 90% (or, as provided in
Section 8.1.7(a), 100%) of the amount of Proven Reserves to which value
is given in the determination of the then current Borrowing Base and
satisfactory title evidence in form and substance acceptable to the
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Administrative Agent in its reasonable business judgment as to
ownership of such Oil and Gas Properties and the valid first Liens in
favor of the Administrative Agent.
(c) Promptly upon the determination that any Subsidiary has
become a Material Subsidiary, the Borrower will cause such Material
Subsidiary to execute and deliver to the Administrative Agent a
Guaranty and a Security Agreement and (if such Subsidiary has Oil and
Gas Properties included in the Borrowing Base) a Mortgage, and the
Borrower will enter into such amendments to the Pledge Agreement as are
necessary to cause the stock or partnership interests, as the case may
be, of such Material Subsidiary to become subject to the Pledge
Agreement.
(d) The Borrower shall ensure that all written information,
exhibits, certificates and reports furnished by or on behalf of the
Borrower to the Administrative Agent do not and will not contain any
untrue statement of material fact and do not and will not omit to state
any material fact or any fact necessary to make the statements
contained therein not misleading in light of the circumstances in which
made, and will promptly disclose to the Administrative Agent and
correct any defect or error that may be discovered therein or in any
Loan Document or in the execution, acknowledgment or recordation
thereof.
SECTION 8.1.8. YEAR 2000 COMPLIANCE. The Borrower will promptly
notify the Administrative Agent in the event the Borrower discovers or
determines that any computer application (including those of its suppliers and
vendors) that is material to its or any of its Subsidiaries' business and
operations will not be Year 2000 Compliant on a timely basis, except to the
extent that such failure could not reasonably be expected to have a Material
Adverse Effect.
SECTION 8.2. NEGATIVE COVENANTS. The Borrower agrees with the
Administrative Agent, each Lender and the Issuer that, until all Commitments
have terminated and all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 8.2.
SECTION 8.2.1. BUSINESS ACTIVITIES. The Borrower will not, and will
not permit any of its Subsidiaries to, engage in any business activity, except
those described in the first recital and such activities as may be incidental or
related thereto.
SECTION 8.2.2. INDEBTEDNESS. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following:
(a) Indebtedness in respect of the Loans and other
Obligations;
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(b) Indebtedness in an aggregate principal amount not to
exceed (i) $500,000 at any time outstanding which is incurred by the
Borrower or any of its Subsidiaries to a vendor of any assets not
prohibited from being acquired by Section 8.2.8 to finance its
acquisition of such assets and (ii) $250,000 at any one time
outstanding by the Borrower or any of its Subsidiaries which is secured
by Liens described in Section 8.2.3(j);
(c) unsecured Indebtedness incurred in the ordinary course of
business (including (i) open accounts extended by suppliers on normal
trade terms in connection with purchases of goods and services and (ii)
gas balancing, but excluding Indebtedness incurred through the
borrowing of money or Contingent Liabilities);
(d) Hedging Obligations incurred pursuant to Hedging
Agreements approved by the Administrative Agent pursuant to Section
8.2.15;
(e) Contingent Obligations incurred to satisfy bonding
requirements imposed by any Government Agency not to exceed, in the
aggregate, $500,000, excluding any Letters of Credit;
(f) Indebtedness existing as of the Effective Date which is
identified in Item 8.2.2(f) of the Disclosure Schedule and refinancings
thereof; provided that the principal amount thereof is not increased
beyond the amount outstanding thereunder on the Effective Date;
(g) Indebtedness in respect of Capitalized Lease Obligations
in an amount not to exceed $500,000 at any time outstanding;
(h) Indebtedness owed by the Borrower to any of the
Subsidiaries or by any Material Subsidiary of the Borrower to the
Borrower or any Material Subsidiary;
(i) endorsements of negotiable instruments for collection in
the ordinary course of business;
(j) Indebtedness of the Borrower and its Subsidiaries which
are Investments to the extent permitted by Section 8.2.5(b);
(k) Additional Indebtedness not permitted by clauses (a)
through (j) above, provided, however, that the aggregate amount of all
Indebtedness incurred by the Borrower and its Subsidiaries pursuant to
this clause (k) shall not exceed $500,000 at any one time outstanding;
and
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(l) Renewals, extensions, amendments, refinancing,
rearrangements, modifications, restatements, defeasances, purchases or
supplements of any Indebtedness referred to in Subsection 8.2.2(a)
through (k), provided that any such Indebtedness is not increased
beyond the amount thereof outstanding on the Effective Date or on the
date of incurrence of such Indebtedness in accordance with this
Section;
provided, however, that no Indebtedness otherwise permitted by clause (b) shall
be permitted if, after giving effect to the incurrence thereof, any Default
shall have occurred and be continuing.
SECTION 8.2.3. LIENS. The Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon
any of its property, revenues or assets, whether now owned or hereafter
acquired, except:
(a) Liens securing payment of the Obligations, granted
pursuant to any Loan Document;
(b) Liens granted to secure payment of Indebtedness of the
type permitted and described in clause (b) of Section 8.2.2 and
covering only those assets acquired with the proceeds of such
Indebtedness;
(c) Hydrocarbon production sales contracts entered into by the
Borrower or its Subsidiaries in the ordinary course of business;
(d) Liens for taxes, assessments or other governmental charges
or levies not at the time delinquent or thereafter payable without
penalty or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books;
(e) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other
Liens imposed by law incurred in the ordinary course of business for
claims which are either not delinquent or are being contested in good
faith by appropriate proceedings and as to which the Borrower or its
applicable Subsidiary shall have set aside on its books such reserves
as may be required pursuant to GAAP; provided, that at no time shall
such sums which are being contested exceed in the aggregate $100,000;
(f) Liens incurred in the ordinary course of business in
connection with workmen's compensation, unemployment insurance or other
forms of governmental insurance or benefits, or to secure performance
of tenders, statutory obligations, leases and contracts (other than for
borrowed money)
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entered into in the ordinary course of business or to secure
obligations on surety or appeal bonds, including lessee or operator
obligations under statutes, governmental regulations or instruments
related to the ownership, exploration and production of oil, gas and
minerals on private, state, federal or foreign lands or waters;
(g) covenants, restrictions, easements, servitudes, permits,
conditions, exceptions, reservations, minor rights, minor encumbrances,
minor irregularities in title or conventional rights of reassignment
prior to abandonment which do not materially interfere with the
occupation, use and enjoyment by the Borrower or any of its
Subsidiaries of their respective assets in the ordinary course of
business as presently conducted, or materially impair the value thereof
for the purpose of such business;
(h) judgment Liens in existence less than thirty (30) days
after the entry thereof or with respect to which execution has been
stayed or the payment of which is covered in full (subject to a
customary deductible) by insurance maintained with responsible
insurance companies;
(i) Liens granted prior to the Effective Date to secure
payment of Indebtedness described in clause (f) of Section 8.2.2;
provided that such Lien does not extend to any other Property;
(j) any Lien, excluding any Lien to secure Indebtedness for
Debt, existing on any asset of any Person that is not included in the
Borrowing Base at the time such Person becomes a Subsidiary of the
Borrower or is merged or consolidated with or into the Borrower or a
Subsidiary of the Borrower, or as of the acquisition of such asset,
provided that such Lien does not extend to any other Property and was
not created in contemplation of such event;
(k) Liens on cash and Cash Equivalent Investments securing
Hedging Obligations, provided that the aggregate amount of cash and
Cash Equivalent Investments subject to such Liens may at no time exceed
$250,000;
(l) Liens which (1) do not secure Debt, (2) arise by statute
or in the ordinary course of business under operating agreements, joint
venture agreements, oil and gas partnership agreements, oil and gas
leases, farm-out agreements, division orders, contracts for the sale,
transportation or exchange of oil and natural gas, unitization and
pooling declarations and agreements, area of mutual interest
agreements, overriding royalty agreements, marketing agreements,
processing agreements, net profits agreements, Production Payments,
development agreements, production sales contracts, gas balancing or
deferred production agreements, injection, repressuring and recycling
agreements, salt water or other disposal agreements, seismic or other
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geophysical permits or agreements, and other agreements which are, in
the Administrative Agent's reasonable judgment, customary in the oil
and gas business, and (3) are for claims which are either not
delinquent or are being contested in good faith by appropriate
proceedings and as to which the Borrower or its applicable Subsidiaries
shall have set aside on its books such reserves as may be required
pursuant to GAAP;
(m) Liens arising solely by virtue of any statutory or common
law provision relating to banker's liens, rights of set-off or similar
rights and remedies and burdening only deposit accounts or other funds
maintained with a creditor depository institution; provided that (i) no
such deposit account is a dedicated cash collateral account or is
subject to restrictions against access by the depositor in excess of
those set forth by regulations promulgated by the Board of Governors of
the Federal Reserve System, and (ii) no such deposit account is
intended by Borrower or any of its Subsidiaries to provide collateral
to the depository institution;
(n) any Lien arising out of the refinancing, extension,
renewal or refunding of any Indebtedness secured by any Lien permitted
by any of the foregoing clauses of this Section, provided that any such
Indebtedness is not increased beyond the amount thereof outstanding on
the Effective Date or on the date of incurrence of such Lien in
accordance with this Section and is not secured by any additional
assets;
(o) the statutory Lien to secure payment of the proceeds of
Hydrocarbon production established by Texas Bus. & Com. Code Section
9.319 and similar laws of other jurisdictions;
(p) rights reserved to or vested in any Government Agency by
the terms of any right, power, franchise, grant, license, or permit, or
by any provision of law, to terminate such right, power, franchise,
grant, license, or permit or to purchase, condemn, expropriate, or
recapture or to designate a purchaser of any of the Properties of the
Borrower or its Subsidiaries;
(q) rights of a common owner of any interest in real estate,
rights of way, or easements held by the Borrower or its Subsidiary and
such common owner as tenant in common or through other common
ownership;
(r) Liens not otherwise permitted by the foregoing clauses of
this Section 8.2.3 securing Indebtedness in an aggregate principal or
face amount not at any time exceeding $500,000; and
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(s) Liens on the Arco East Texas Property, to the extent the
Company's Subsidiary owning such Property is indemnified against any
loss arising therefrom pursuant to the Arco Title Indemnity.
SECTION 8.2.4. FINANCIAL CONDITION. The Borrower will not permit:
(a) Tangible Net Worth at any time to be less than the sum of
(i) $44,574,521 plus (ii) fifty percent (50%) of consolidated net
income of the Borrower and its Subsidiaries (excluding the effects of
consolidated net losses) for each Fiscal Quarter beginning on or after
July 1, 1999, plus (iii) one-hundred percent (100%) of the net proceeds
of any Non-Redeemable Stock offering by the Borrower or any of its
Subsidiaries at any time after the Effective Date;
(b) the Current Ratio at any time to be less than 1.0:1.0; or
(c) the Interest Coverage Ratio at the end of any Fiscal
Quarter to be less than 3.0:1.0.
The Borrower shall not, and shall not suffer or permit any Subsidiary
to, make any significant change in accounting treatment or reporting
practices, except as required by GAAP, or, without the consent of the
Administrative Agent, such consent not to be unreasonably withheld,
change the fiscal year of the Borrower or of any Subsidiary.
SECTION 8.2.5. INVESTMENTS. The Borrower will not, and will not permit
any of its consolidated or Material Subsidiaries to, make, incur, assume or
suffer to exist any Investment in any other Person, except:
(a) Cash Equivalent Investments;
(b) in the ordinary course of business, Investments by the
Borrower in any of its Material Subsidiaries, or by any such Subsidiary
in the Borrower or any of its Material Subsidiaries, by way of
contributions to capital or loans or advances;
(c) without duplication, Investments in the nature of Capital
Expenditures;
(d) Investments existing on the Effective Date and identified
in Item 8.2.5(d) of the Disclosure Schedule;
(e) Investments permitted by Section 8.2.8;
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(f) Investments in limited partnerships entered into by the
Borrower or a Subsidiary of the Borrower, or general partnerships
entered into by a non-Material Subsidiary of the Borrower, in each case
with industry partners in the ordinary course of its business, or
capital contributions to such partnerships, provided, that (i) such
partnership is engaged exclusively in oil and gas exploration,
development or production activities, (ii) the Borrower's or such
Subsidiary's equity interests in such partnerships were acquired in the
ordinary course of Borrower's or such Subsidiary's business and upon
fair and reasonable terms and (iii) which Investments, in the
aggregate, do not exceed five percent (5%) of the Borrowing Base at the
time of such Investment; and further provided, that the limitations of
this subsection (f) shall not apply to any Investment made in a
Material Subsidiary;
(g) accounts receivable from customers in the ordinary course
of business;
(h) loans and advances to employees not to exceed $100,000 in
the aggregate as to all such loans and advances outstanding at any
time;
(i) Investments in connection with or related to farm-out
agreements, farm-in agreements, joint operating agreements or other
similar arrangements, and the performance of Borrower's or such
Subsidiary's obligations thereunder in accordance with prudent
operating standards and in the ordinary course of business;
(j) Investments made with Non-Redeemable Stock, but only to
the extent allocable to such Non-Redeemable Stock, and subject to the
consequences of a Change of Control;
(k) Investments in "margin stock" (as such term is defined in
F.R.S. Board Regulation U, X or T), to the extent acquisitions of
margin stock are permitted by Section 5.10; and
(l) any Investment not otherwise permitted by the foregoing
clauses of this Section if, immediately after such Investment is made
or acquired, the aggregate net book value of all Investments permitted
by this clause (m) does not exceed $100,000.
provided, however, that
(i) any Investment which when made complies with the
requirements of the definition of the term "Cash Equivalent
Investment" may continue to be held notwithstanding that such
Investment if made thereafter would not comply with such
requirements; and
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(ii) no Investment otherwise permitted by clause (b)
and (c) shall be permitted to be made if, immediately before
or after giving effect thereto, any Default shall have
occurred and be continuing.
SECTION 8.2.6. RESTRICTED PAYMENTS, ETC. On and at all times after the
Effective Date:
(a) the Borrower will not, and will not permit any of its
Subsidiaries (other than a wholly-owned Subsidiary) to, declare, pay or
make any dividend or distribution (in cash, property or obligations) on
any class or shares of any class of partnership interest or Capital
Stock (now or hereafter outstanding) of the Borrower or such Subsidiary
or on any options, warrants or other rights with respect to any
interest or shares of any class of partnership interest or Capital
Stock (now or hereafter outstanding) of the Borrower or such Subsidiary
or apply, or permit any of its Subsidiaries to apply, any of its funds,
property or assets to the purchase, redemption, sinking fund or other
retirement of, any interest or shares of any class of partnership
interest or Capital Stock (now or hereafter outstanding) of the
Borrower or such Subsidiary or options, warrants or other rights with
respect to any interest or shares of any class of partnership interest
or Capital Stock (now or hereafter outstanding) of the Borrower or such
Subsidiary (such declarations, dividends, distributions or applications
being called "Distribution Payments") other than Distribution Payments
which do not cause the Borrower to be in violation of the Restricted
Payment Tests; provided, however, that the Borrower may make or accrue
Distribution Payments in the form of additional shares of Capital Stock
of the Borrower or accruals thereof, so long as such additional shares
of Capital Stock of the Borrower do not entitle the holder thereof to
receive Distribution Payments payable in cash as a matter of right;
(b) the Borrower will not permit any of its Subsidiaries to
make any Distribution Payments other than to the Borrower; and
(c) the Borrower will not, and will not permit any of its
Subsidiaries to, make any deposit for any of the foregoing purposes.
SECTION 8.2.7. RENTAL OBLIGATIONS. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into at any time any arrangement
(excluding oil and gas leases entered into in the ordinary course of business)
which involves the leasing by the Borrower or any consolidated or Material
Subsidiary from any lessor of any real or personal property (or any interest
therein), except arrangements which, together with all other such arrangements
which shall then be in effect, will not require the payment of an aggregate
amount of rentals by the Borrower or any of its Subsidiaries in excess of
(excluding escalations resulting from a rise in the consumer price or similar
index) $500,000 for any Fiscal Year or $2,000,000 during the full remaining
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term of such arrangements, including any so-called synthetic lease; provided,
however, that any calculation made for purposes of this Section 8.2.7 shall
exclude any amounts (i) required to be expended for maintenance and repairs,
insurance, taxes, assessments, and other similar charges and (ii) any amounts
relating to Capitalized Lease Obligations.
SECTION 8.2.8. CONSOLIDATION, MERGER, ETC. The Borrower will not,
and will not permit any of its Subsidiaries to, liquidate or dissolve,
consolidate with, or merge into or with, any other corporation, partnership or
other Person, or purchase or otherwise acquire all or substantially all of the
assets of any Person (or of any division thereof) except
(a) so long as no Default has occurred and is continuing or
would so occur after giving effect thereto, (i) any such Subsidiary
(other than a Material Subsidiary) may liquidate or dissolve
voluntarily into, and may merge with and into, the Borrower or any
other Subsidiary, (ii) any Material Subsidiary may liquidate or
dissolve voluntarily into, and may merge with and into, the Borrower or
any other Material Subsidiary, (iii) the assets or stock of any
Subsidiary (other than a Material Subsidiary) may be purchased or
otherwise acquired by the Borrower or any other Subsidiary, (iv) the
assets or stock of any Material Subsidiary may be purchased or
otherwise acquired by the Borrower or any other Material Subsidiary,
and (v) the Borrower may merge with or into another Person if the
Borrower is the Person surviving such merger and Principal Shareholders
retain control over the Borrower; and
(b) so long as no Default has occurred and is continuing or
would so occur after giving effect thereto, the Borrower or any of its
Subsidiaries may purchase all or substantially all of the assets of any
Person, or acquire such Person by merger.
The Borrower will not create any Subsidiary unless it shall promptly give notice
thereof to the Administrative Agent.
SECTION 8.2.9. ASSET DISPOSITIONS, ETC.
(a) The Borrower will not, and will not permit any of its
consolidated or Material Subsidiaries to, sell, transfer, lease,
contribute or otherwise convey, or grant options, warrants or other
rights with respect to, all or substantially all of the assets of the
Borrower or any of its consolidated or Material Subsidiaries in any one
transaction or in any series of transactions, whether or not related.
(b) The Borrower will not, and will not permit any of its
consolidated or Material Subsidiaries to, sell, transfer, lease,
contribute or otherwise convey,
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or grant options, warrants or other rights with respect to any
substantial part of its assets (including accounts receivable), to any
Person other than
(i) if such asset(s) are not in the Borrowing Base,
such sale, transfer, lease, contribution or conveyance is for
cash or other consideration having a value at least equal to
the fair market value of such assets;
(ii) if such assets are in the Borrowing Base, the
Borrower complies with the terms of Section 3.1.2 and such
sale, transfer, lease, contribution or conveyance is for cash
in an amount at least equal to the fair market value of such
assets; or
(c) farmouts under standard industry terms of Properties not
holding Proven Reserves.
SECTION 8.2.10. MODIFICATION OF CERTAIN DOCUMENTS.
(a) The Borrower will not, and will not permit any of its
consolidated or Material Subsidiaries to, amend its Organic Documents
or consent to any amendment, supplement or other modification of any of
the terms or provisions contained in, or applicable to, the Material
Contracts or any other agreement affecting the Mortgaged Properties
which could reasonably be expected to have a Material Adverse Effect,
in each case without the prior written consent of the Administrative
Agent.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, amend the Arco Title Indemnity in a manner which
adversely affects the Borrower, its Subsidiaries or the Lenders, waive
any right or claim thereunder or consent to the substitution or
addition of any alternate or substitute indemnitor thereunder, in each
case without the prior written consent of the Required Lenders.
SECTION 8.2.11. TRANSACTIONS WITH AFFILIATES. The Borrower will not,
and will not permit any of its consolidated or Material Subsidiaries to, enter
into, or cause, suffer or permit to exist any arrangement or contract with any
of its other Affiliates unless such arrangement or contract is fair and
equitable to the Borrower or such Subsidiary and is an arrangement or contract
of the kind which would be entered into by a prudent Person in the position of
the Borrower or such Subsidiary with a Person which is not one of its
Affiliates.
SECTION 8.2.12. NEGATIVE PLEDGES, RESTRICTIVE AGREEMENTS, ETC. The
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any agreement (excluding this Agreement, any other Loan Document and any
agreement
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governing any Indebtedness permitted by clauses (b) or (f) of Section 8.2.2 as
in effect on the Effective Date as to the assets financed with the proceeds of
such Indebtedness) prohibiting
(a) the creation or assumption of any Lien upon its
properties, revenues or assets, whether now owned or hereafter
acquired, or the ability of the Borrower or any other Obligor to amend
or otherwise modify this Agreement or any other Loan Document; or
(b) the ability of any Material Subsidiary to make any
payments, directly or indirectly, to the Borrower by way of dividends,
advances, repayments of loans or advances, reimbursements of management
and other intercompany charges, expenses and accruals or other returns
on investments, or any other agreement or arrangement which restricts
the ability of any such Material Subsidiary to make any payment,
directly or indirectly, to the Borrower.
SECTION 8.2.13. TAKE OR PAY CONTRACTS. Except as disclosed to the
Lender in Item 8.2.13 of the Disclosure Schedule, and except for reservation
charges payable for reservations of capacity in gathering systems and pipelines
incurred in the ordinary course of business on an arm's length basis for volumes
reasonably expected to be produced from the Borrowers' or its Subsidiaries' Oil
and Gas Properties to be transported through such systems and pipelines, the
Borrower will not, and will not permit any of its Subsidiaries to, enter into or
be a party to any arrangement for the forward sale of Hydrocarbons or the
purchase of materials, supplies, other property (including without limitation
Hydrocarbons), or services if such arrangement requires that payment be made by
the Borrower or such Subsidiary regardless of whether such materials, supplies,
other property, or services are delivered or furnished to it.
SECTION 8.2.14. SALE/LEASEBACKS. Obligors will not enter into any
arrangement, directly or indirectly, with any Person whereby any Obligor shall
sell or transfer any material asset, and whereby any Obligor shall then or
immediately thereafter rent or lease as lessee such asset or any part thereof.
SECTION 8.2.15. HYDROCARBON HEDGING. Commencing October 1, 1999, the
Borrower will not, and will not permit any of its Subsidiaries to, enter into
Hedging Agreements except those that (a) are with a Lender whose senior
unsecured long term debt or certificates of deposit is rated at least A by
Standard & Poor's Corporation or A2 by Moody's Investors Service, Inc., such
Lender's Affiliates or other counterparties reasonably acceptable to the
Administrative Agent, (b) do not result in Hedging Obligations that are (i) at
any time during the twenty-four (24) months immediately following the incurrence
of such Hedging Obligation, in excess of seventy-five percent (75%) of the
reasonably anticipated production of Hydrocarbons during such period from the
proved developed producing Hydrocarbon reserves owned by the Borrower and its
Subsidiaries according to the most recent Engineering Report delivered to the
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Administrative Agent or (ii) at any time following the end of such twenty four
(24) month period, in excess of fifty percent (50%) of the reasonably
anticipated production of Hydrocarbons during such period from the proved
developed producing Hydrocarbon reserves owned by the Borrower and its
Subsidiaries according to the most recent Engineering Report delivered to the
Administrative Agent and (c) the amount of the Hedging Obligation for the
particular Hydrocarbon (i.e. - gas or oil) must not be materially in excess of
the proportion that such Hydrocarbon bears to the total amount of proved
developed Hydrocarbon reserves owned by the Borrower and its Subsidiaries. (For
example, if the Borrower and its Subsidiaries owned proved developed producing
Hydrocarbon reserves that were 45% oil-producing Properties and 55%
gas-producing Properties, then any Hedging Obligation of the Borrower or its
Subsidiaries for oil could not be, during the initial 24 month period,
materially more than 45% of 75% of the reasonably anticipated production of
Hydrocarbons from the proved developed producing Hydrocarbon reserves owned by
the Borrower and its Subsidiaries according to the most recent Engineering
Report delivered to the Administrative Agent.) The Borrower has entered into no
other Hedging Agreements other than those listed in Schedule V.
ARTICLE IX
EVENTS OF DEFAULT
SECTION 9.1. LISTING OF EVENTS OF DEFAULT. Each of the following events
or occurrences described in this Section 9.1 shall constitute an "Event of
Default".
SECTION 9.1.1. NON-PAYMENT OF OBLIGATIONS. The Borrower shall default
in the payment or prepayment when due of any principal of any Loan; the Borrower
shall default in the payment when due of any Reimbursement Obligation or Hedging
Agreement in effect between the Borrower and a Lender or Affiliate thereof; or
the Borrower shall default (and such default shall continue unremedied for a
period of five (5) days) in the payment when due of any interest on any Loan or
any fees payable under Section 3.3 or any other Obligation.
SECTION 9.1.2. BREACH OF WARRANTY. Any representation or warranty of
the Borrower or any other Obligor made or deemed to be made hereunder or in any
other Loan Document executed by it or any other writing or certificate furnished
by or on behalf of the Borrower or any other Obligor to the Administrative
Agent, any Issuer or any Lender for the purposes of or in connection with this
Agreement or any such other Loan Document (including any certificates delivered
pursuant to Article VI) is or shall be incorrect when made in any material
respect.
SECTION 9.1.3. NON-PERFORMANCE OF CERTAIN COVENANTS AND OBLIGATIONS.
The Borrower shall default in the due performance and observance of any of its
obligations
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under Section 3.1.2, Section 8.1 (other than Sections 8.1.1(j), 8.1.1(n), 8.1.2,
8.1.3, 8.1.6 or 8.1.7) or Section 8.2.
SECTION 9.1.4. NON-PERFORMANCE OF OTHER COVENANTS AND OBLIGATIONS. The
Borrower or any other Obligor shall default in the due performance and
observance of any other agreement contained herein or in any other Loan Document
executed by it, and such default shall continue unremedied for a period of
fifteen (15) days after notice thereof shall have been given to the Borrower by
the Administrative Agent or any Lender.
SECTION 9.1.5. DEFAULT ON OTHER INDEBTEDNESS.
(a) A default shall occur in the payment when due (subject to
any applicable grace period), whether by acceleration or otherwise, of
any Indebtedness (excluding Indebtedness described in Section 9.1.1) of
the Borrower or any other Obligor having a principal amount,
individually or in the aggregate, in excess of $250,000, or a default
shall occur in the performance or observance of any obligation or
condition with respect to such Indebtedness if the effect of such
default is to accelerate the maturity of any such Indebtedness or such
default shall continue unremedied for any applicable period of time
sufficient to permit any holder of such Indebtedness, or any trustee or
Administrative Agent for such holders, to cause such Indebtedness to
become due and payable prior to its expressed maturity.
(b) A failure to pay when due any royalty, overriding royalty
or similar interest burdening the Oil and Gas Properties of the
Borrower or any of its Subsidiaries, in the aggregate, in excess of
$250,000.
SECTION 9.1.6. JUDGMENTS. Any judgment or order for the payment of
money in excess of $250,000 (in excess of valid and collectible insurance in
respect thereof the payment of which is not being disputed or contested by the
insurer or insurers) shall be rendered against the Borrower or any other Obligor
and either
(a) enforcement proceedings shall have been commenced by any
creditor upon such judgment or order; or
(b) there shall be any period of ten (10) consecutive days
during which a stay of enforcement of such judgment or order, by reason
of a pending appeal or otherwise, shall not be in effect.
SECTION 9.1.7. PENSION PLANS. Any of the following events shall occur
with respect to any Pension Plan
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(a) the institution of any steps by the Borrower, any member
of its Controlled Group or any other Person to terminate a Pension Plan
if, as a result of such termination, the Borrower or any such member
could be required to make a contribution to such Pension Plan in excess
of $100,000, or could reasonably expect to incur a liability or
obligation to such Pension Plan in excess of $100,000; or
(b) a contribution failure occurs with respect to any Pension
Plan sufficient to give rise to a Lien under Section 302(f) of ERISA.
SECTION 9.1.8. CONTROL OF THE BORROWER. Any Change in Control shall
occur.
SECTION 9.1.9. BANKRUPTCY, INSOLVENCY, ETC. The Borrower or any other
Obligor shall
(a) become insolvent or generally fail to pay, or admit in
writing its inability or unwillingness to pay, debts as they become
due;
(b) apply for, consent to, or acquiesce in, the appointment of
a trustee, receiver, sequestrator or other custodian for the Borrower
or any other Obligor or any property of any thereof, or make a general
assignment for the benefit of creditors;
(c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a trustee,
receiver, sequestrator or other custodian for the Borrower or any other
Obligor or for a substantial part of the property of any thereof, and
such trustee, receiver, sequestrator or other custodian shall not be
discharged within sixty (60) days, provided that the Borrower and each
other Obligor hereby expressly authorizes the Administrative Agent and
each Lender to appear in any court conducting any relevant proceeding
during such sixty (60)-day period to preserve, protect and defend its
or their rights under the Loan Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case or
proceeding under any bankruptcy or insolvency law, or any dissolution,
winding up or liquidation proceeding, in respect of the Borrower or any
other Obligor, and, if any such case or proceeding is not commenced by
the Borrower or such other Obligor, such case or proceeding shall be
consented to or acquiesced in by the Borrower or such other Obligor or
shall result in the entry of an order for relief or shall remain for
sixty (60) days undismissed, provided that the Borrower and each other
Obligor hereby expressly authorizes the Administrative Agent and each
Lender to appear in any court conducting any such case or proceeding
during
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such sixty (60)-day period to preserve, protect and defend its or their
rights under the Loan Documents; or
(e) take any action authorizing, or in furtherance of, any of
the foregoing.
SECTION 9.1.10. IMPAIRMENT OF SECURITY, ETC. Any Loan Document, or any
Lien granted thereunder, shall (except in accordance with its terms), in whole
or in part, terminate, cease to be effective or cease to be the legally valid,
binding and enforceable obligation of any Obligor party thereto; the Borrower,
any other Obligor or any other party shall, directly or indirectly, contest in
any manner such effectiveness, validity, binding nature or enforceability; or
any Lien securing any Obligation shall, in whole or in part, cease to be a
perfected first priority Lien, subject only to those exceptions expressly
permitted by the Loan Documents.
SECTION 9.1.11. MATERIAL ADVERSE EFFECT. Any Material Adverse Effect
shall occur.
SECTION 9.1.12. BORROWING BASE DEFICIENCY. Any Borrowing Base
Deficiency shall occur and continue for more than ninety (90) days.
SECTION 9.2. ACTION IF BANKRUPTCY. If any Event of Default described in
clauses (a) through (d) of Section 9.1.9 shall occur with respect to the
Borrower or any other Obligor, the Commitments (if not theretofore terminated)
shall automatically terminate and the outstanding principal amount of all
outstanding Loans and all other Obligations shall automatically be and become
immediately due and payable, without notice or demand.
SECTION 9.3. ACTION IF OTHER EVENT OF DEFAULT. If any Event of Default
(other than any Event of Default described in clauses (a) through (d) of Section
9.1.9 with respect to the Borrower or any other Obligor) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the Administrative
Agent, may (and, upon direction by the Required Lenders, shall) by notice to the
Borrower declare all or any portion of the outstanding principal amount of the
Loans and other Obligations to be due and payable and/or the Commitments (if not
theretofore terminated) to be terminated, whereupon the full unpaid amount of
such Loans and other Obligations which shall be so declared due and payable
shall be and become immediately due and payable, without further notice, demand
or presentment, and/or, as the case may be, the Commitments shall terminate.
SECTION 9.4. RIGHTS NOT EXCLUSIVE. The rights provided for in this
Agreement and the other Loan Documents are cumulative and are not exclusive of
any other rights, powers, privileges or remedies provided by Applicable Law or
in equity, or under any other instrument, document or agreement now existing or
hereafter arising.
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ARTICLE X
THE ADMINISTRATIVE AGENT
SECTION 10.1. ACTIONS. Each Lender hereby appoints Bank of America as
its Administrative Agent under and for purposes of this Agreement, the Notes and
each other Loan Document, and Bank of America hereby accepts such appointment.
Each Lender authorizes the Administrative Agent to act on behalf of such Lender
under this Agreement, the Notes and each other Loan Document and, in the absence
of other written instructions from the Required Lenders received from time to
time by the Administrative Agent (with respect to which the Administrative Agent
agrees that it will comply, except as otherwise provided in this Section and to
the extent such instructions may reasonably be expected to comply with
applicable law), to exercise such powers and to perform such duties hereunder
and thereunder as are specifically delegated to or required of the
Administrative Agent by the terms hereof and thereof, together with such powers
as may be reasonably incidental thereto; provided, however, that the
Administrative Agent shall not take any action that requires the consent of any
Lender unless it receives such consent. Each Lender hereby indemnifies (which
indemnity shall survive any termination of this Agreement) the Administrative
Agent, pro rata according to such Lender's Percentage, from and against any and
all liabilities, obligations, losses, damages, claims, costs or expenses of any
kind or nature whatsoever which may at any time be imposed on, incurred by, or
asserted against, the Administrative Agent in any way relating to or arising out
of this Agreement, the Notes and any other Loan Document, including reasonable
attorneys' fees, and as to which the Administrative Agent is not reimbursed by
the Borrower; provided, however, that no Lender shall be liable for the payment
of any portion of such liabilities, obligations, losses, damages, claims, costs
or expenses which are determined by a court of competent jurisdiction in a final
proceeding to have resulted solely from the Administrative Agent's gross
negligence or wilful misconduct. The Administrative Agent shall not be required
to take any action hereunder, under the Notes or under any other Loan Document,
or to prosecute or defend any suit in respect of this Agreement, the Notes or
any other Loan Document, unless it is indemnified hereunder to its satisfaction.
If any indemnity in favor of the Administrative Agent shall be or become, in the
Administrative Agent's determination, inadequate, the Administrative Agent may
call for additional indemnification from the Lenders and cease to do the acts
indemnified against hereunder until such additional indemnity is given.
SECTION 10.2. FUNDING RELIANCE, ETC. Unless the Administrative Agent
shall have been notified by telephone, confirmed in writing, by any Lender by
5:00 p.m. (Dallas time) on the day prior to a Borrowing that such Lender will
not make available the amount which would constitute its Percentage of such
Borrowing on the date specified therefor, the Administrative Agent may assume
that such Lender has made
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such amount available to the Administrative Agent and, in reliance upon such
assumption, make available to the Borrower a corresponding amount. If and to the
extent that such Lender shall not have made such amount available to the
Administrative Agent, such Lender and the Borrower severally agree to repay the
Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date the Administrative Agent made such
amount available to the Borrower to the date such amount is repaid to the
Administrative Agent, at the interest rate applicable at the time to Loans
comprising such Borrowing.
SECTION 10.3. EXCULPATION. Neither the Administrative Agent nor any of
its directors, officers, employees or Administrative Agents shall be liable to
any Lender for any action taken or omitted to be taken by it under this
Agreement or any other Loan Document, or in connection herewith or therewith,
except for its own wilful misconduct or gross negligence, nor responsible for
any recitals or warranties herein or therein, nor for the effectiveness,
enforceability, validity or due execution of this Agreement or any other Loan
Document, nor for the creation, perfection or priority of any Liens purported to
be created by any of the Loan Documents, or the validity, genuineness,
enforceability, existence, value or sufficiency of any collateral security, nor
to make any inquiry respecting the performance by the Borrower of its
obligations hereunder or under any other Loan Document. Any such inquiry which
may be made by the Administrative Agent shall not obligate it to make any
further inquiry or to take any action. The Administrative Agent shall be
entitled to rely upon advice of counsel concerning legal matters and upon any
notice, consent, certificate, statement or writing which the Administrative
Agent believes to be genuine and to have been presented by a proper Person.
SECTION 10.4. SUCCESSOR. The Administrative Agent may resign as such at
any time upon at least thirty (30) days' prior notice to the Borrower and all
Lenders, and the Administrative Agent may be removed with or without cause as
such by the Required Lenders upon at least thirty (30) days' prior notice to the
Administrative Agent and the Borrower. If the Administrative Agent at any time
shall resign or be removed, the Required Lenders may appoint another Lender as a
successor Administrative Agent which Lender shall thereupon become the
Administrative Agent hereunder. If no successor Administrative Agent shall have
been so appointed by the Required Lenders, and shall have accepted such
appointment, within thirty (30) days after the giving of notice of resignation
or removal, then the retiring or removed Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent, which shall be one of the
Lenders and, if no Lender accepts such appointment, a commercial banking
institution organized under the laws of the United States (or any State thereof)
or a United States branch or agency of a commercial banking institution, and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent
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shall be entitled to receive from the retiring or removed Administrative Agent
such documents of transfer and assignment as such successor Administrative Agent
may reasonably request, and shall thereupon succeed to and become vested with
all rights, powers, privileges and duties of the retiring or removed
Administrative Agent, and the retiring or removed Administrative Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Administrative Agent's resignation or removal hereunder as
the Administrative Agent, the provisions of
(a) this Article X shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was the
Administrative Agent under this Agreement; and
Section 11.3 and Section 11.4 shall continue to inure to its
benefit.
SECTION 10.5. LOANS OR LETTERS OF CREDIT ISSUED BY BANK OF AMERICA.
Bank of America shall have the same rights and powers with respect to (x) the
Loans made by it or any of its Affiliates, (y) the Notes held by it or any of
its Affiliates, and (z) its participating interests in the Letters of Credit as
any other Lender and may exercise the same as if it were not the Administrative
Agent. Bank of America and its Affiliates and each of the Lenders and each of
the Issuers and their respective Affiliates may accept deposits from, lend money
to, and generally engage in any kind of business with the Borrower or any
Subsidiary or Affiliate of the Borrower as if Bank of America were not the
Administrative Agent hereunder and in the case of each Lender or Issuer, as if
such Lender or such Issuer were not a Lender or Issuer hereunder.
SECTION 10.6. CREDIT DECISIONS. Each Lender and each Issuer
acknowledges that it has, independently of the Administrative Agent, each other
Issuer and each other Lender, and based on such Lender's or such Issuer's review
of the financial information of the Borrower, this Agreement, the other Loan
Documents (the terms and provisions of which being satisfactory to such Lender
or such Issuer) and such other documents, information and investigations as such
Lender or such Issuer has deemed appropriate, made its own credit decision to
extend its Commitments. Each Lender and each Issuer also acknowledges that it
will, independently of the Administrative Agent and each other Lender and each
other Issuer, and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time any rights and
privileges available to it under this Agreement or any other Loan Document.
SECTION 10.7. COPIES, ETC. The Administrative Agent shall give prompt
notice to each Lender and each Issuer of each notice or request required or
permitted to be given to the Administrative Agent by the Borrower pursuant to
the terms of this
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Agreement (unless concurrently delivered to the Lenders and each Issuer by the
Borrower). The Administrative Agent will distribute promptly to each Lender and
each Issuer each document or instrument received for its account and copies of
all other communications received by the Administrative Agent from the Borrower
for distribution to the Lenders and Issuers by the Administrative Agent in
accordance with the terms of this Agreement.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. WAIVERS, AMENDMENTS, ETC.
(a) This Agreement is an amendment and restatement of, and
replaces and supersedes, the Existing Credit Agreement in its entirety;
provided, however, that no right, interest, claim or cause of action of
any kind of the lender under the Existing Credit Agreement shall in any
way be released, modified, compromised or waived by virtue of this
Agreement superseding and replacing the Existing Credit Agreement, and
nothing in this Agreement or the other Loan Documents is intended to
novate or discharge the indebtedness of the Borrower or the other
Obligors under the Existing Credit Agreement; provided however, upon
the satisfaction of all conditions set forth in Section 6.1, Bank of
America shall terminate its Lien on all shares of the Capital Stock of
the Borrower under Pledge Agreements under the Existing Credit
Agreement that were previously delivered by shareholders of the
Borrower;
(b) The provisions of this Agreement and of each other Loan
Document may from time to time be amended, modified or waived, if such
amendment, modification or waiver is in writing and consented to by the
Borrower and the Required Lenders; provided, however, that no such
amendment, modification or waiver which would:
(i) modify any requirement hereunder that any
particular action be taken by all the Lenders or by the
Required Lenders shall be effective unless consented to by
each Lender;
(ii) modify this Section 11.1, change the definitions
of "Required Lenders", "Restricted Payment Tests," "Total
Commitment", "Letter of Credit Availability", or "Commitment
Amount", increase the Percentage of any Lender, reduce any
fees described in Article III, amend Section 6.1.15 or 8.2.6,
release any collateral security including any Guaranty, except
as otherwise specifically provided in any Loan Document, or
extend the Stated Maturity Date or any Commitment
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Termination Date, shall be made without the consent of each
Lender affected thereby;
(iii) extend the due date for, or reduce the amount
of, any scheduled or mandatory repayment or prepayment of
principal of or interest on any Loan (or reduce the principal
amount of or rate of interest on any Loan) shall be made
without the consent of each Lender affected thereby;
(iv) affect adversely the interests, rights or
obligations of an Issuer in its capacity as Issuer shall be
made without the consent of such Issuer; or
(v) affect adversely the interests, rights or
obligations of the Administrative Agent in its capacity as the
Administrative Agent shall be made without consent of the
Administrative Agent.
No failure or delay on the part of the Administrative Agent, any Issuer or any
Lender in exercising any power or right under this Agreement or any other Loan
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or demand on
the Borrower in any case shall entitle it to any notice or demand in similar or
other circumstances. No waiver or approval by the Administrative Agent, any
Issuer or any Lender under this Agreement or any other Loan Document shall,
except as may be otherwise stated in such waiver or approval, be applicable to
subsequent transactions. No waiver or approval hereunder shall require any
similar or dissimilar waiver or approval thereafter to be granted hereunder.
SECTION 11.2. NOTICES. All notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing and shall be hand delivered or sent by overnight courier, certified mail
(return receipt requested), or telecopy to such party at its address or telecopy
number set forth on Schedule III hereto or set forth in the Lender Assignment
Notice or at such other address or telecopy number as may be designated by such
party in a notice to the other parties. Without limiting any other means by
which a party may be able to provide that a notice has been received by the
other party, a notice shall be deemed to be duly received (a) if sent by hand,
on the date when left with a responsible person at the address of the recipient;
(b) if sent by certified mail or overnight courier, on the date of receipt (or
refusal to accept delivery) by a responsible person at the address of the
recipient; and (c) if sent by telecopy, on the date of receipt by the sender of
an acknowledgment or transmission reports generated by the machine from which
the telecopy was sent indicating that the telecopy was sent in its entirety to
the recipient's telecopy number.
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SECTION 11.3. PAYMENT OF COSTS AND EXPENSES. The Borrower agrees to pay
on demand all reasonable expenses of the Administrative Agent (including the
fees and out-of-pocket expenses of internal and external counsel to the
Administrative Agent and of local counsel, if any, who may be retained by
counsel to the Administrative Agent) in connection with
(a) the negotiation, preparation, due diligence, execution,
delivery, syndication, administration and enforcement of this Agreement
and of each other Loan Document, including schedules and exhibits, and
any amendments, waivers, consents, supplements or other modifications
to this Agreement or any other Loan Document as may from time to time
hereafter be required, whether or not the transactions contemplated
hereby are consummated,
(b) the filing, recording, refiling or rerecording of the
Mortgages, the Security Agreements and the Pledge Agreements and/or any
Uniform Commercial Code financing statements relating thereto and all
amendments, supplements and modifications to, and releases and
terminations of, any thereof and any and all other documents or
instruments of further assurance required to be filed or recorded or
refiled or rerecorded by the terms hereof or of the Mortgages, the
Security Agreements and the Pledge Agreements, and
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save each of the Administrative
Agent, each Issuer and the Lenders harmless from all liability for, any stamp or
other taxes which may be payable in connection with the execution or delivery of
this Agreement, the borrowings hereunder, the issuance of the Notes, the
issuance of the Letters of Credit, or any other Loan Documents. During (i) the
existence of a Default and (ii) whether or not a Default still exists, after any
acceleration of the Obligations, the Borrower also agrees to reimburse the
Administrative Agent, each Lender and each Issuer upon demand for all reasonable
out-of-pocket expenses (including attorneys' fees and legal expenses of internal
and external attorneys, and accountants', engineers' and other consultants' fees
and expenses) incurred by the Administrative Agent, each Lender and each Issuer
in connection with (x) the negotiation of any restructuring or "work-out",
whether or not consummated, of any Obligations and (y) the enforcement of any
Obligations.
SECTION 11.4. INDEMNIFICATION. In consideration of the execution and
delivery of this Agreement by the Administrative Agent, each Issuer and each
Lender and the extension of the Commitments, the Borrower hereby indemnifies,
exonerates and holds the Administrative Agent, each Issuer and each Lender and
each of their respective officers, directors, employees and agents
(collectively, the "Indemnified Parties") free and harmless from and against any
and all actions, causes of action,
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suits, losses, costs, liabilities and damages, and expenses incurred in
connection therewith (irrespective of whether any such Indemnified Party is a
party to the action for which indemnification hereunder is sought), including
reasonable attorneys' fees and disbursements (collectively, the "Indemnified
Liabilities"), incurred by the Indemnified Parties or any of them as a result
of, or arising out of, or relating to
(a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Loan or the use
of any Letter of Credit;
(b) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any
Person, whether or not the Administrative Agent or such Issuer or such
Lender is party thereto;
(c) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to
any Environmental Law or the condition of any facility or Property
owned, leased or operated by the Borrower or any of its Subsidiaries;
provided, however, that Indemnified Liabilities under this Section
11.4(c) pertaining to Oil and Gas Properties located in the State of
California shall be governed by the Unsecured Indemnity;
(d) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any
facility or Property owned, leased or operated by the Borrower or any
of its Subsidiaries thereof of any Hazardous Material (including any
losses, liabilities, damages, injuries, costs, expenses or claims
asserted or arising under any Environmental Law), regardless of whether
caused by, or within the control of, the Borrower or any of its
Subsidiaries; provided, however, that Indemnified Liabilities under
this Section 11.4(d) pertaining to Oil and Gas Properties located in
the State of California shall be governed by the Unsecured Indemnity;
or
(e) any misrepresentation, inaccuracy or breach in or of
Section 7.17 or Section 8.1.6, except for any such Indemnified
Liabilities arising for the account of a particular Indemnified Party
by reason of the relevant Indemnified Party's gross negligence or
wilful misconduct. If and to the extent that the foregoing undertaking
may be unenforceable for any reason, the Borrower hereby agrees to make
the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under Applicable Law.
SECTION 11.5. SURVIVAL. The obligations of the Borrower under Sections
5.3, 5.4, 5.5, 5.6, 11.3 and 11.4 shall in each case survive any termination of
this
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Agreement, the payment in full of all Obligations and the termination of all
Commitments. The representations and warranties made by each Obligor in this
Agreement and in each other Loan Document shall survive the execution and
delivery of this Agreement and each such other Loan Document.
SECTION 11.6. SEVERABILITY. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any jurisdiction
shall, as to such provision and such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or such Loan Document or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION 11.7. HEADINGS. The various headings of this Agreement and of
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 11.8. EXECUTION IN COUNTERPARTS, EFFECTIVENESS, ETC. This
Agreement may be executed by the parties hereto in several counterparts, each of
which shall be executed by the Borrower, the Administrative Agent, each Issuer
and each Lender and be deemed to be an original and all of which shall
constitute together but one and the same agreement. This Agreement shall become
effective when counterparts hereof are executed on behalf of the Borrower, the
Administrative Agent, and each Lender, and the Administrative Agent has
determined that the conditions set forth in Section 6.1 have been satisfied..
This Agreement is made and entered into for the sole protection and legal
benefit of the Borrower, the Administrative Agent and the Lenders and Persons
indemnified hereunder, and their permitted successors and assigns, and no other
Person shall be a direct or indirect legal beneficiary of, or have any direct or
indirect cause of action or claim in connection with, this Agreement or any of
the other Loan Documents.
SECTION 11.9. GOVERNING LAW; ENTIRE AGREEMENT. THIS AGREEMENT, THE
NOTES AND EACH OTHER LOAN DOCUMENT (OTHER THAN THE MORTGAGES OR AS EXPRESSLY
PROVIDED IN ANY SUCH DOCUMENT) SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF TEXAS. This Agreement, the
Notes and the other Loan Documents constitute the entire understanding among the
parties hereto with respect to the subject matter hereof and supersede any prior
agreements, written or oral, with respect thereto.
SECTION 11.10. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
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(a) the Borrower may not assign or transfer its rights or
obligations hereunder without the prior written consent of the
Administrative Agent, all Issuers and all Lenders; and
(b) the rights of sale, assignment and transfer of Lenders are
subject to Section 11.11.
SECTION 11.11. SALE AND TRANSFER OF LOANS AND NOTES; PARTICIPATIONS IN
LOANS AND NOTES. Each Lender may assign, or sell participations in, its Loans
and Commitments and participations in Letters of Credit to one or more other
Persons in accordance with this Section 11.11.
SECTION 11.11.1. ASSIGNMENTS. A Lender may at any time assign and
delegate to one or more Eligible Assignees (each Person to whom such assignment
and delegation is to be made, being hereinafter referred to as an "Assignee
Lender"), all or any fraction of such Lender's total Loans and Commitments
(which assignment and delegation shall be of a constant, and not a varying,
percentage of all such Lender's Loans and Commitments) in a minimum aggregate
amount of $5,000,000 (or the entire remaining amount of such Lender's Loans and
Commitments); provided, however, that such Lender is required at all times to
maintain Loans, Letters of Credit Outstandings and Commitments hereunder in an
aggregate amount of $5,000,000 (unless such Lender shall have reduced its Loans,
Letters of Credit Outstandings and Commitments to zero); provided, further,
however, that the Borrower and each other Obligor shall be entitled to continue
to deal solely and directly with such Lender in connection with the interests so
assigned and delegated to an Assignee Lender until
(a) written notice of such assignment and delegation, together
with payment instructions, addresses and related information with
respect to such Assignee Lender, shall have been given to the Borrower
and the Administrative Agent by such Lender and such Assignee Lender,
(b) such Assignee Lender shall have executed and delivered to
the Borrower, the Administrative Agent and such Lender a Lender
Assignment Notice, accepted by such Lender, the Borrower (if required)
and the Administrative Agent, and
(c) the processing fees described below shall have been paid.
From and after the date that the Administrative Agent and the Borrower (if
required) accepts such Lender Assignment Notice, (x) the Assignee Lender
thereunder shall be deemed automatically to have become a party hereto and to
the extent that rights and obligations hereunder have been assigned and
delegated to such Assignee Lender in connection with such Lender Assignment
Notice, shall have the rights and obligations of a Lender hereunder and under
the other Loan Documents, and (y) the assignor
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Lender, to the extent that rights and obligations hereunder have been assigned
and delegated by it in connection with such Lender Assignment Notice, shall be
released from its obligations hereunder and under the other Loan Documents.
Within five (5) Business Days after the later to occur of (i) its receipt of
notice that the Administrative Agent has received and accepted an executed
Lender Assignment Notice and (ii) the Borrower's receipt and acceptance (if
required) of the Lender Assignment Notice executed by the Administrative Agent
and all other parties thereto, the Borrower shall execute and deliver to the
Administrative Agent (for delivery to the relevant Assignee Lender) a new Note
evidencing such Assignee Lender's assigned Loans and Commitments and, if the
assignor Lender has retained Loans and Commitments hereunder, a replacement Note
in the principal amount of the Loans and Commitments retained by the assignor
Lender hereunder (each such Note to be in exchange for, but not in payment of,
the corresponding Note then held by such assignor Lender). The assignor Lender
shall mark the predecessor Note "exchanged" and deliver it to the Borrower.
Accrued interest on that part of the predecessor Note evidenced by the new Note,
and accrued fees, shall be paid as provided in the Lender Assignment Notice.
Accrued interest on that part of the predecessor Note evidenced by the
replacement Note shall be paid to the assignor Lender. Accrued interest and
accrued fees shall be paid at the same time or times provided in the predecessor
Notes and in this Agreement. Such assignor Lender or such Assignee Lender must
also pay a processing fee to the Administrative Agent upon delivery of any
Lender Assignment Notice in the amount of $3,500. Any attempted assignment and
delegation not made in accordance with this Section 11.11.1 shall be null and
void. Nothing contained in this Agreement shall prohibit any Lender from
pledging or assigning any Note to any Federal Reserve Bank in accordance with
Applicable Law.
SECTION 11.11.2. PARTICIPATIONS. A Lender may at any time sell to one
or more commercial banks or other Persons (each of such commercial banks and
other Persons being herein called a "Participant") participating interests in
any of the Loans, Commitments, or other interests of such Lender hereunder;
provided, however, that
(a) no participation contemplated in this Section 11.11.2
shall relieve a Lender from its Commitments or its other obligations
hereunder or under any other Loan Document,
(b) such Lender shall remain solely responsible for the
performance of its Commitments and such other obligations,
(c) the Borrower and each other Obligor shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement and each of the other Loan
Documents,
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(d) the Borrower shall not be required to pay any amount under
Section 5.6 that is greater than the amount which it would have been
required to pay had no participating interest been sold, and
(e) any agreement pursuant to which any Lender may grant such
a participating interest shall provide that such Lender shall retain
the sole right and responsibility to enforce the obligations of the
Borrower and the Issuer hereunder including, without limitation, the
right to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such participation agreement may
provide that such Lender will not agree to any modification, amendment
or waiver of this Agreement described in clause (ii) or (iii) of
Section 11.1(b) without the consent of the Participant.
The Borrower acknowledges and agrees that each Participant shall, to the extent
provided in its participation agreement, be entitled to the benefits of Sections
5.3, 5.4, 5.5, and 5.6 (except as provided in Section 11.11.2(d)), 11.3 and 11.4
with respect to its participation interest.
SECTION 11.12. FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE
AGENT, ANY ISSUER OR ANY LENDER OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED
IN THE COURTS OF THE STATE OF TEXAS OR IN THE UNITED STATES DISTRICT COURT FOR
THE NORTHERN DISTRICT OF TEXAS; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF TEXAS AND
OF THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS FOR THE
PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE
BOUND BY ANY FINAL, NON-APPEALABLE JUDGMENT RENDERED THEREBY IN CONNECTION WITH
SUCH LITIGATION. THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR
WITHOUT THE STATE OF TEXAS. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE
OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS
-105-
<PAGE> 113
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE
BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS
UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 11.13. WAIVER OF JURY TRIAL. THE ADMINISTRATIVE AGENT, EACH
ISSUER, EACH LENDER AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE
AGENT, EACH ISSUER, ANY LENDER OR THE BORROWER. THE BORROWER ACKNOWLEDGES AND
AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION
(AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY)
AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT,
EACH ISSUER AND EACH LENDER ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER
LOAN DOCUMENT.
SECTION 11.14. OTHER TRANSACTIONS. Nothing contained herein shall
preclude the Administrative Agent or any other Lender or any of their respective
Affiliates from engaging in any transaction, in addition to those contemplated
by this Agreement or any other Loan Document, with the Borrower or any of its
Affiliates in which the Borrower or such Affiliate is not restricted hereby from
engaging with any other Person.
SECTION 11.15. MAXIMUM INTEREST.
(a) It is the intention of the parties hereto to comply strictly with
Applicable Laws pertaining to usury, if any; accordingly, notwithstanding any
provision to the contrary in this Agreement or in any of the other Loan
Documents, in no event shall the Loan Documents require or permit the payment,
taking, reserving, receiving, collection or charging of any sums constituting
interest under applicable laws which exceed the maximum amount of interest
permitted by such laws (such maximum lawful interest rate, if any, herein called
the "Highest Lawful Rate"). If any such excess interest is called for,
contracted for, charged, taken, reserved, or received in connection with any
Obligation under this Agreement or in any of the documents securing the payment
hereof or otherwise relating hereto, or in any communication by the
Administrative Agent, any Lender or any other person to the Borrower or any
other person, or in the event all or part of the principal or interest of any
Loan shall be prepaid or accelerated, so that under any of such circumstances
or under any other circumstance whatsoever the amount of interest contracted
for, charged, taken, reserved, or received on the amount of principal actually
outstanding from time to time
-106-
<PAGE> 114
under this Agreement or any other Loan Document shall exceed the maximum
amount of interest permitted by Applicable Laws pertaining to usury, then in any
such event it is agreed as follows: (i) the provisions of this Section shall
govern and control, (ii) the aggregate of all consideration which constitutes
interest under Applicable Law that is called for, contracted for, charged,
taken, reserved or received under this Agreement and the other Loan Documents,
or under any of the other aforesaid agreements or otherwise in connection with
this Agreement shall under no circumstances exceed the Highest Lawful Rate, any
such excess shall be credited against the then unpaid principal balance of
Obligations of the Borrower by the Administrative Agent (or, if such Obligations
shall have been paid in full, such excess refunded to Borrower by the Lenders);
(iii) all sums paid, or agreed to be paid, to the Administrative Agent for the
benefit of the Lenders for the use, forbearance and detention of the amounts
owed under this Agreement by the Borrower hereunder shall, to the extent
permitted by Applicable Law, be amortized, prorated, allocated and spread
throughout the full term of the Obligations, including all prior and subsequent
renewals and extensions, owed under this Agreement and the other Loan Documents
until payment in full so that the actual rate of interest is uniform throughout
the full term thereof; and (iv) if at any time the interest provided pursuant to
this Agreement together with any other fees payable pursuant to this Agreement
and the other Loan Documents and deemed interest under Applicable Law, exceeds
that amount which would have accrued at the Highest Lawful Rate, the amount of
interest, swap breakage, and any such fees to accrue pursuant to this Agreement
and the other Loan Documents shall be limited, notwithstanding anything to the
contrary in this Agreement or in any other Loan Document to that amount which
would have accrued at the Highest Lawful Rate, but any reductions in the
interest otherwise provided pursuant to this Agreement, as applicable, shall be
carried forward and collected in periods in which the amount of interest
accruing otherwise pursuant to this Agreement shall be less than the Highest
Lawful Rate until the total amount of interest (including such fees deemed to be
interest) accrued pursuant to this Agreement and the other Loan Documents equals
the amount of interest which would have accrued if a varying rate per annum
equal to the Alternate Base Rate had at all times been in effect plus the amount
of fees which would have been received but for the effect of this Section and
the Highest Lawful Rate limitation imposed in Section 3.2.1. Without limiting
the foregoing, all calculations of the rate of interest contracted for, charged,
taken, reserved, or received in connection herewith which are made for the
purpose of determining whether such rate exceeds the maximum lawful rate shall
be made to the extent permitted by Applicable Laws by amortizing, prorating,
allocating and spreading during the period of the full term of the Obligations,
including all prior and subsequent renewals and extensions, all interest at any
time contracted for, charged, taken, reserved, or received. The terms of this
section shall be deemed to be incorporated in every Loan Document, security
instrument and other document executed in connection therewith, and every
communication relating thereto.
-107-
<PAGE> 115
(b) The Borrower, the Administrative Agent, each Issuer and each Lender
agree that Chapter 346 of the Texas Finance Code ("Chapter 346") (which
regulates certain revolving loan accounts and revolving tri-party accounts)
shall not apply to any revolving loan accounts created under this Agreement, the
Notes or the other Loan Documents or maintained in connection therewith.
(c) To the extent that the interest rate laws of the State of Texas are
applicable to this Agreement, any Note or any other Loan Document, the
applicable interest rate ceiling is the indicated "weekly ceiling" determined in
accordance with Chapter 1D of the Texas Credit Code, as amended, and, to the
extent that any Obligation under this Agreement, any Note or any other Loan
Document is deemed an open end account as such term is defined in the Texas
Credit Code, the Administrative Agent retains the right to modify the interest
rate in accordance with Applicable Law.
SECTION 11.16. CONTROLLING DOCUMENT. In the event of actual conflict in
the terms and provisions of this Agreement, the Notes and the other Loan
Documents, the terms and provisions of this Agreement will control.
[Signature pages follow]
-108-
<PAGE> 116
SECTION 11.17. NOTICE. THIS WRITTEN AGREEMENT TOGETHER WITH THE OTHER
LOAN DOCUMENTS REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
BORROWER:
BARGO ENERGY COMPANY, a Texas corporation
By
--------------------------------------------
Name: Jonathan M. Clarkson
Title: President
Address: 700 Louisiana Street
Suite 3700
Houston, Texas 77002
Attn: Jonathan M. Clarkson
Fax: 713-236-9799
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A., formerly Bank of America
National Trust and Savings Association
By
--------------------------------------------
Title: Managing Director
Printed Name: Ronald E. McKaig
Address for Notices:
Agency Administrative Services
901 Main Street
Dallas, Texas 75202
-109-
<PAGE> 117
Attention: Vicky Wages
Telecopier No: 214-290-8373
Telephone No: 214-209-9254
with copies to:
333 Clay Street
Suite 4550
Houston, Texas 77002
Attn: Ronald E. McKaig
Fax: (713) 651-4888
-110-
<PAGE> 118
LENDERS:
BANK OF AMERICA, N.A.
By
--------------------------------------------
Title: Managing Director
Printed Name: Ronald E. McKaig
-111-
<PAGE> 119
BANK ONE, TEXAS, NA
By
--------------------------------------------
Title:
-112-
<PAGE> 120
WELLS FARGO BANK (TEXAS) NA
By
--------------------------------------------
Title:
-113-
<PAGE> 121
SCHEDULE I
DISCLOSURE SCHEDULE
ITEM 7.9 Litigation
Falcon Resources, Inc. vs. Atlantic Richfield Company and Future
Acquisition 1995, Ltd. in the District Court of Rusk County,
Texas - This action concerns the purported exercise of a
Preferential Right to Purchase S. Kilgore Waterflood Unit, which
is a portion of the Arco East Texas Property.
ITEM 7.10 Ownership of Properties
ARCO East Texas Acquisition - In Exhibit A to the Purchase and
Sale Agreement dated August 3, 1999, between Atlantic Richfield
Company and Future Acquisition 1995, Ltd., the parties
identified a Title Defects sometimes called the "Marshall Title
Defect".
In an action entitled Stanley G. Marshall, Jr., Catherine Irene
Marshall, Margaret Anne Warne and Robert R. Marshall v. ARCO Oil
and Gas Company, a division of Atlantic Richfield Company, Civil
Action No. 3217, District Court of 49th Judicial District,
Zapata County, Texas, the court rendered a second modified
judgment on March 19, 1998 against ARCO Oil and Gas Company, a
division of Atlantic Richfield Company, in the amount of
$68,986,926.75, which amount accrues interest at the rate of 10%
compounded annually, as provided in the judgment (such judgment,
as the same may be from time to time revised, re-entered,
amended, partially satisfied, renewed or otherwise modified in
any way, herein called the "Marshall Judgment").
The Marshall Title Defect and the Marshall Judgment are the
subject to the Arco Title Indemnity.
An Amended Abstract of Judgment giving notice of the Marshall
Judgment was recorded in the public records of the following
counties, among others:
Gregg County, Texas File No. 9807331 on April 14, 1998
Rusk County, Texas Volume 2069, Page 193 on April 21, 1998
Smith County, Texas
Upshur County, Texas
<PAGE> 122
ITEM 7.12 Employee Benefit Plans
None
ITEM 7.14 Claims and Liabilities
None
ITEM 7.17 Environmental Matters
None
ITEM 8.2.2(f) Existing Indebtedness
Indebtedness owed to Bank One Texas in the principal amount
of approximately $9,300.00.
ITEM 8.2.5(c) Existing Investments
None
ITEM 8.2.13 Take or Pay Contracts
None
<PAGE> 123
SCHEDULE II
SUBSIDIARIES
<TABLE>
<CAPTION>
TYPE OF AUTHORIZED OUTSTANDING PERCENT
SUBSIDIARY JURISDICTION ENTITY SHARES SHARES OWNERSHIP
---------------------------- ------------ ------------ ---------- ------------ ---------
<S> <C> <C> <C> <C> <C>
Future Petroleum Corporation Texas Corporation 10,000 1,000 100%
Alaska Eldorado Gold, Co. Nevada Corporation 1,000 1,000 99.8%
Future Energy Corporation Nevada Corporation 50,000 1,000 100%
Future CAL-TEX Corporation Texas Corporation 1,000,000 1,000 100%
BMC Development No. 1 Texas Limited *
Limited Partnership Partnership
NC1-Shawnee Texas Limited *
Limited Partnership Partnership
Future Acquisition 1995, Ltd. Texas Limited *
Partnership
</TABLE>
- ------------
* Owned 1% by Future Petroleum Corporation (Texas) and 99% by Future Energy
Corporation
a. Future Acquisition 1995 and Future Petroleum Corporation are qualified to do
business in the State of Louisiana, Mississippi, New Mexico.
b. Future Cal-Tex Corporation is qualified to do business in the state of
California.
c. NCI-Shawnee Limited Partnership, Future Petroleum Corporation and BMC
Development No. 1 Limited Partnership are qualified to do business in the State
of Oklahoma.
d. NCI-Shawnee Limited Partnership, BMC Development No. 1 Limited Partnership
and Future Acquisition 1995, Ltd. are qualified to do business in the State of
Nevada.
<PAGE> 124
SCHEDULE III
ADMINISTRATIVE DETAILS
BANK OF AMERICA, N.A.
Percentage: 50%
Lending office for Base Rate Loans:
901 Main Street
Dallas, Texas 75202
Attention: Vicky Wages
Telephone: 214-290-8373
Facsimile: 214-209-9254
Lending Office for LIBO Rate Loans:
901 Main Street
Dallas, TX 75202
Attention: Vicky Wages
Telephone: 214-290-8373
Facsimile: 214-209-9254
BANK ONE, TEXAS, NA
Percentage: 30%
Lending office for Base Rate Loans:
Bank One, Texas, NA
910 Travis
TX2-4330
Houston, TX 77002
Credit Contact: Christine M. Macan, Vice President
Telephone: 713-751-3484
Facsimile: 713-751-3544
Operations Contact: Eleanor Martinez, Participation/Syndication Analyst
<PAGE> 125
500 Throckmorton
West Complex PG6
Fort Worth, TX 76102
Telephone: 817-884-4535
Facsimile: 817-884-4651
Lending Office for LIBO Rate Loans:
Bank One, Texas, NA
910 Travis
TX2-4330
Houston, TX 77002
Credit Contact: Christine M. Macan, Vice President
Telephone: 713-751-3484
Facsimile: 713-751-3544
Operations Contact: Eleanor Martinez, Participation/Syndication Analyst
Bank One, Texas, NA
500 Throckmorton
West Complex PG6
Fort Worth, TX 76102
Telephone: 817-884-4535
Facsimile: 817-884-4651
WELLS FARGO BANK (TEXAS), NA
Percentage: 20%
Lending office for Base Rate Loans:
Wells Fargo Bank (Texas), NA
1000 Louisiana
Third Floor
Houston, TX 77002
Credit Contact: Brian K. Otis, Assistant Vice President
Telephone: 713-819-1316
Facsimile: 713-739-1087
Operations Contact: Stephen Elring, Assistant Vice President
201 Third
<PAGE> 126
San Francisco, CA 94103
Telephone: 415-477-5425
Facsimile: 415-979-0675
Lending Office for LIBO Rate Loans:
Wells Fargo Bank (Texas), NA
1000 Louisiana
Third Floor
Houston, TX 77002
Credit Contact: Brian K. Otis, Assistant Vice President
Telephone: 713-819-1316
Facsimile: 713-739-1087
Operations Contact: Stephen Elring, Assistant Vice President
201 Third
San Francisco, CA 94103
Telephone: 415-477-5425
Facsimile: 415-979-0675
<PAGE> 127
SCHEDULE IV
EXISTING MORTGAGES
A. Mortgage, Deed of Trust, Assignment, Security Agreement and
Financing Statement from Mortgagor to Bank of America was
recorded and filed as follows:
<TABLE>
<CAPTION>
ORIGINAL AMENDMENT
JURISDICTION FILE NO. DATE FILE NO. DATE
------------ -------- ---- -------- ----
<S> <C> <C> <C> <C>
1. LOUISIANA
Ouachita Parish, Volume 1630, Page 541 12/2/98 Vol. 1633, Page 784 12/17/98
Louisiana File No. 1243297 File No. 1244887
(Mortgage)
Volume 391, Page 341 1/21/99
File No. 1247111
(Conveyance)
Vermillion Parish, File No. 9813248 12/2/98 File No. 9813911 12/17/98
Louisiana (Mortgage)
File No. 9900755 1/21/99
(Conveyance)
2. MISSISSIPPI
Clarke County, DT Deed Book 216, Page 7 10/22/98
Mississippi
Wayne County, DT Deed Book 959, Page 358 10/22/98
Mississippi
3. NEW MEXICO
Lea County, Book 901, Page 276 8/24/98 Book 924, Page 492 12/17/98
New Mexico File No. 36851
Roosevelt County, Book 53, Page 824 10/23/98 Book 55, Page 193 12/17/98
New Mexico
4. OKLAHOMA
Grant County, Book 515, Page 699 8/24/98 Book 518, Page 039 12/17/98
Oklahoma File No. 2088
</TABLE>
<PAGE> 128
<TABLE>
<CAPTION>
ORIGINAL AMENDMENT
JURISDICTION FILE NO. DATE FILE NO. DATE
------------ -------- ---- -------- ----
<S> <C> <C> <C> <C>
Marshall County, Book 673, Page 659 8/24/98 Book 679, Page 117 12/17/98
Oklahoma File No. SF-4998
Pottawatomie County, Book 2835, Page 232 8/24/98 Book 2883, Page 278 12/17/98
Oklahoma File No. 17177
Pottawatomie County, Book 2859, Page 101 10/20/98
Oklahoma Rec. # 1998-14245
5. TEXAS
Austin County, File No. 994053 7/13/98
Texas
Bastrop County, Volume 955, Page 831 12/31/98
Texas File No. 199814768
Brazos County, Volume 3323, Page 195 12/1/98
Texas File No. 0672275
Volume 3359, Page 119 1/7/99
File No. 0675214
Burleson County, Volume 163, Page 550 12/1/98
Texas File No. 0003900
Volume 164, Page 175 12/31/98
File No. 0004256
Carson County, Volume 289, Page 756 8/24/98 Vol. 292, Page 780 12/17/98
Texas File No. 0001984
Crane County, Volume 400, Page 89 10/26/98 Vol. 401, Page 732 12/17/98
Texas File. No. 76025, File No. 76282
Dawson County, Volume 240, Page 239; 10/22/98 Vol. 240, Page 727 12/17/98
Texas File No. 98-3130 File No. 3634
Ector County, Volume 1433, Page 787 12/1/98 Vol. 1436, Page 0502 12/17/98
Texas File No. 16298 File No. 17011
Fayette County, Volume 1046, Page 414 12/1/98
Texas
Volume 1049, Page 369 12/31/98
File No. 98-7363
Gray County, Volume 734, Page 398 8/24/98 Vol. 739, Page 189 12/17/98
Texas File No. 141597
</TABLE>
<PAGE> 129
<TABLE>
<CAPTION>
ORIGINAL AMENDMENT
JURISDICTION FILE NO. DATE FILE NO. DATE
------------ -------- ---- -------- ----
<S> <C> <C> <C> <C>
Harris County, Doc. No. ###-##-#### 10/16/98 Doc. No. ###-##-#### 12/17/98
Texas 300235009 T328911 T443676
Hutchinson County, Volume 902, Page 263 8/24/98 Vol. 921, Page 213 12/17/98
Texas File No. 0290432
Jackson County, Volume 129, Page 212 12/1/98
Texas File No. 26666
Volume 131,Page 228 1/5/99
Jasper County, Volume 222, Page 1 10/22/98 File No. 125171 12/17/98
Texas Document No. 123827
Live Oak County, Volume 360, Page 1 10/22/98 Vol. 362, Page 453 12/17/98
Texas Reg. No. 0141952 File No. 142714
Lubbock County, Volume 5965, Page 10 8/24/98 Vol. 6099, Page 187 12/17/98
Texas File No. 43783
Matagorda County, Volume 521,Page 570 12/1/98 Vol. 523, Page 559 12/17/98
Texas File No. 988068 File No. 988487
McMullen County, Volume 138, Page 146 12/1/98 Vol. 138, Page 385 12/17/98
Texas File No. 54861 File No. 54917
Midland County, Volume 1593, Page 430 8/24/98 Vol. 1628, Page 32 12/17/98
Texas File No. 24121
Montgomery County, Doc. No. 99047460; 6/14/99 545-00-0999 6/14/99
Texas 545-00-0960
Montgomery County, File No. 9947462 6/14/99
Texas
Moore County, Volume 499, Page 636 8/24/98 Vol. 504, Page 469 12/17/98
Texas File No. 131996
San Patricio County, File No. 467305 10/22/98 File No. 469028 12/17/98
Texas
Waller County, File No. 994753 8/5/99
Texas
Wharton County, Volume 299, Page 423 0/26/98 Vol. 305, Page 545 12/17/98
Texas Document No. 190511 File No. 191762
Wichita County, Volume 2030, Page 280 8/24/98 Vol. 2058, Page 321 12/17/98
Texas File No. 24402
</TABLE>
<PAGE> 130
<TABLE>
<CAPTION>
ORIGINAL AMENDMENT
JURISDICTION FILE NO. DATE FILE NO. DATE
------------ -------- ---- -------- ----
<S> <C> <C> <C> <C>
6. CALIFORNIA
Kern County, Doc. 0198114687 8/24/98 Doc. 0198184114 12/30/98
California Doc. 0198118749 8/31/98
</TABLE>
- ----------------------------
<PAGE> 131
SCHEDULE V
HEDGING AGREEMENTS
o Approximately 50% (or 150,000 MMBtu per month) of current gas production
is hedged through calendar year 1999 as follows:
- Collar hedge for 65,000 MMBtu based on the Southern California
Border Index with a floor of $2.00 and a cap of $2.45.
- Collar hedge for 85,000 MMBtu based on the Houston Ship Channel
Index with a floor of $2.00 and a cap of $2.04.
o Approximately 50% of current oil production is hedged as follows:
- 22,800 barrels beginning October 1999 declining each month to
18,750 barrels in September 2000 at a floor of $18.00 and a cap
of $20.75.
- 27,400 barrels beginning October 1999 declining each month to
23,250 barrels in September 2000 at a floor of $18.00 and a cap
of $23.08.
o For the 12 month period October 2000 - September 2001 a straight swap is
in place for approximately 25% of current monthly oil production at
$17.55 per barrel. (18,525 barrels beginning 10/00 declining to 16,200
barrels in 9/01)
o For the 12 month period October 2000 - September 2001 a straight swap is
in place for approximately 25% of current monthly oil production at
$18.05 per barrel. (22,825 barrels beginning 10/00 declining to 18,100
barrels in 9/01)
<PAGE> 132
SCHEDULE VI
UPDATED TITLE SEARCHES
TEXAS
Phil Wahl -
1. Crane County - Atlantic State Nos. 1-8, Johnson State, Tubb State Wells
2. Wharton County - Rasmussen No. 2 Well
3. Jasper County - Mixson Unit No. 1 and Mixson No. 1
4. [N/A]
5. San Patricio County - Waldo Haisley No. 1 GU
6. Jackson County - Bright Falcon Prospect, Hillman No. 1 Well
7. Brazos County - Kuder Prospect, Kuder #2 Well
8. McMullen County - San Miguel Prospect, Clifton Wheeler 3, 8, 9 and 15,
San Miguel Creek Gu, Louis Gubbels No. 24
9. Matagorda County - Turtle Creek Prospect, Don L. Batchelder Gu No. 1
10. Brazos County - Riverside Campus Prospect, Riverside Campus 3 and 6 Oil
Units
11. Ector County - Cowden South Prospect, Lyda Mae Johnson Nos. 1A and 2, JE
Bagley Nos. 1, 2, 11, 12, 14 and 15A
12. Harris and Montgomery Counties - Cross Creek Field
13. Austin County - Post-closing opinion for Raccoon Bend
Gerald E. Thornton, Jr. (Matthews and Branson) -
1. Moore County - Panhandle
LOUISIANA
Jim Mansfield (Liskow and Lewis) -
1. Vermilion Parish - North Leroy Field
Jeff Townsend -
1. Ouachita Parish - Cheniere Cadeville
<PAGE> 133
OKLAHOMA
Michael Burris -
1. Pottawatomie County - Shawnee Townsite (Skinner) Unit
CALIFORNIA
Tim Lewy -
1. Kern County - South Coles Levee
<PAGE> 134
EXHIBIT A
FORM OF
SECOND AMENDED AND RESTATED
SECURED PROMISSORY NOTE
$_____________ September 30, 1999
FOR VALUE RECEIVED, the undersigned, BARGO ENERGY COMPANY, a Texas
corporation (the "Borrower"), promises to pay to the order of
___________________ (the "Lender") on the Stated Maturity Date the principal sum
of ___________________________ DOLLARS ($_________) or, if less, the aggregate
unpaid principal amount of all Loans (whether or not shown on the schedule
attached hereto and any continuation thereof) made by the Lender pursuant to
that certain Second Amended and Restated Credit Agreement, dated as of September
30, 1999 (together with all amendments and other modifications, if any, from
time to time thereafter made thereto, the "Credit Agreement"), among the
Borrower, certain financial institutions and the Lender and Bank of America,
N.A., as administrative agent (the "Administrative Agent").
The Borrower also promises to pay interest on the unpaid principal
amount hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement.
Payments of both principal and interest are to be made in lawful money
of the United States of America in same day or immediately available funds to
the account designated by the Administrative Agent pursuant to the Credit
Agreement.
This Note, together with the other Notes made and given in favor of the
other Lenders, amends, restates and consolidates those note(s) previously made
and given by Future Petroleum Corporation, a Utah corporation, to which the
Borrower is the successor-by-merger.
This Note is one of the Notes referred to in, and evidences Indebtedness
incurred under, the Credit Agreement, to which reference is made for a
description of the security for this Note and for a statement of the terms and
conditions on which the Borrower is permitted and required to make prepayments
and repayments of principal of the Indebtedness evidenced by this Note and on
which such Indebtedness may be declared to be immediately due and payable.
Unless otherwise defined, terms used herein have the meanings provided in the
Credit Agreement.
<PAGE> 135
All parties hereto, whether as makers, endorsers, or otherwise,
severally waive presentment for payment, demand, protest and notice of dishonor.
THIS NOTE HAS BEEN DELIVERED IN DALLAS, TEXAS AND SHALL BE DEEMED TO BE
A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF TEXAS.
BARGO ENERGY COMPANY, a Texas
corporation
By:
---------------------------------------
Name: Jonathan M. Clarkson
Title: President
<PAGE> 136
LOANS AND PRINCIPAL PAYMENTS
<TABLE>
<CAPTION>
Amount LIBO Amount of Principal Unpaid Principal
of Loan Made Rate Repaid Balance
------------ -------- ------------------- ----------------
Interest Base LIBO Base LIBO Notation
Date Period Rate Rate Rate Rate Total Made By
===================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
===================================================================================================================
</TABLE>
<PAGE> 137
EXHIBIT B
FORM OF SECURITY AGREEMENT
<PAGE> 138
EXHIBIT C-1
FORM OF
BORROWING REQUEST
BANK OF AMERICA, N.A., as Administrative Agent
901 Main Street, 14th Floor
Dallas, Texas 75202
Telecopy:
-------------
Attention: [Name]
[Title]
Re: Bargo Energy Company
Ladies and Gentlemen:
This Borrowing Request is delivered to you pursuant to Section 2.3 of
the Second Amended and Restated Credit Agreement, dated as of September 30, 1999
(together with all amendments, if any, from time to time made thereto, the
"Credit Agreement"), among Bargo Energy Company, a Texas corporation (the
"Borrower"), certain financial institutions (the "Lenders") and BANK OF AMERICA,
N.A., as administrative agent for the Lenders (the "Administrative Agent").
Unless otherwise defined herein or the context otherwise requires, terms used
herein have the meanings provided in the Credit Agreement.
The Borrower hereby requests that a Loan be made in the aggregate
principal amount of $__________ on __________, 19__ as a [LIBO Rate Loan having
an Interest Period of ____ months] [Base Rate Loan].
The Borrower hereby acknowledges that, pursuant to Section 6.3.2 of the
Credit Agreement, each of the delivery of this Borrowing Request and the
acceptance by the Borrower of the proceeds of the Loans requested hereby
constitute a representation and warranty by the Borrower that, on the date of
such Loans, and before and after giving effect thereto and to the application of
the proceeds therefrom, all statements set forth in Section 6.3.1 are true and
correct in all material respects (unless stated to relate solely to an earlier
date, in which case such statements shall be true and correct as of such earlier
date).
The Borrower agrees that if prior to the time of the borrowing requested
hereby any matter certified to herein by it will not be true and correct at such
time as if then made, it
<PAGE> 139
will immediately so notify the Administrative Agent. Except to the extent, if
any, that prior to the time of the borrowing requested hereby the Administrative
Agent shall receive written notice to the contrary from the Borrower, each
matter certified to herein shall be deemed once again to be certified as true
and correct at the date of such borrowing as if then made.
Please wire transfer the proceeds of the borrowing to the following
account[s] ______________________________.
IN WITNESS WHEREOF, the Borrower has caused this request to be executed
and delivered by its duly Authorized Officer as of __________ __, 19__.
BARGO ENERGY COMPANY, a Texas corporation
By:
--------------------------------------
Name: Jonathan M. Clarkson
Title: President
<PAGE> 140
EXHIBIT C-2
FORM OF
CONTINUATION/CONVERSION NOTICE
Bank of America, N.A., as Administrative Agent
901 Main Street, 14th Floor
Dallas, Texas 75202
Telecopy:
--------------
Attention: [Name]
[Title]
Re: Bargo Energy Company
Ladies and Gentlemen:
This Continuation/Conversion Notice is delivered to you pursuant to
Section 2.4 of the Second Amended and Restated Credit Agreement, dated as of
September 30, 1999 (together with all amendments, if any, from time to time made
thereto, the "Credit Agreement"), Bargo Energy Company, a Texas corporation (the
"Borrower"), certain financial institutions (the "Lenders") and Bank of America,
N.A., as agent for the Lenders (the "Administrative Agent"). Unless otherwise
defined herein or the context otherwise requires, terms used herein have the
meanings provided in the Credit Agreement.
The Borrower hereby requests that on _______, 19__,
(1) $_________ of the presently outstanding principal amount
of the Loans originally made on _________, 19__ [and $_______ of the
presently outstanding principal amount of the Loans originally made on
_______, 19__],
(2) and all presently being maintained as [LIBO Rate
Loans] [Base Rate Loans],
(3) be [converted into] [continued as],
(4) [LIBO Rate Loans having an Interest Period of ____
months] [Base Rate Loans].
<PAGE> 141
The Borrower hereby:
(a) certifies and warrants that no Default has occurred
and is continuing; and
(b) agrees that if prior to the time of such continuation
or conversion any matter certified to herein by it will not be true and
correct at such time as if then made, it will immediately notify the
Lender.
Except to the extent, if any, that prior to the time of the continuation or
conversion requested hereby the Administrative Agent shall receive written
notice to the contrary from the Borrower, each matter certified to herein shall
be deemed to be certified at the date of such continuation or conversion as if
then made.
IN WITNESS WHEREOF, the Borrower has caused this request to be executed
and delivered by its duly Authorized Officer as of __________ __, 19__.
BARGO ENERGY COMPANY, a Texas
corporation
By:
--------------------------------------
Name: Jonathan M. Clarkson
Title: President
<PAGE> 142
EXHIBIT D
FORM OF GUARANTY
<PAGE> 143
EXHIBIT E-1
FORM OF MORTGAGE
<PAGE> 144
EXHIBIT E-2
FORM OF CALIFORNIA MORTGAGE
<PAGE> 145
EXHIBIT F-1
FORM OF PLEDGE AGREEMENT (STOCK)
<PAGE> 146
EXHIBIT F-2
FORM OF PLEDGE AGREEMENT (PARTNERSHIP INTERESTS)
<PAGE> 147
EXHIBIT G
LENDER ASSIGNMENT NOTICE
BANK OF AMERICA, N.A., as Administrative Agent
901 Main Street, 14th Floor
Dallas, Texas 75202
Telecopy:
---------------
Attention: [Name]
[Title]
Re: Bargo Energy Company
Ladies and Gentlemen:
We refer to clause (b) of Section 11.11.1 of the Second Amended and
Restated Credit Agreement, dated as of September 30, 1999 (together with all
amendments and other modifications, if any, from time to time thereafter made
thereto, the "Credit Agreement"), among Bargo Energy Company, a Texas
corporation (the "Borrower"), certain financial institutions (the "Lenders") and
BANK OF AMERICA, N.A., as agent for the Lenders (the "Administrative Agent").
Unless otherwise defined herein or the context otherwise requires, terms used
herein have the meanings provided in the Credit Agreement.
This notice is delivered to you pursuant to clause (b) of Section
11.11.1 of the Credit Agreement and also constitutes notice to each of you,
pursuant to clause (a) of Section 11.11.1 of the Credit Agreement, of the
assignment and delegation to _______________ (the "Assignee") of ___% (and the
Assignor hereby assigns and delegates to the Assignee __%_) of the Loans and
Commitments of _____________ (the "Assignor") outstanding under the Credit
Agreement on the date hereof. After giving effect to the foregoing assignment
and delegation, the Assignor's and the Assignee's Percentages for the purposes
of the Credit Agreement are set forth on Schedule I hereto. The Assignor makes
such assignment and delegation without any representations, warranties or
recourse whatsoever except that the Assignor is the legal and beneficial owner
of the interest being assigned by it hereunder and that such interest is free
and clear of any adverse claim. [Add paragraph dealing with accrued interest
with respect to Loans assigned.]
The Assignee hereby acknowledges and confirms that it is an Eligible
Assignee and it has received a copy of the Credit Agreement and the other Loan
Documents and the
<PAGE> 148
exhibits related thereto, together with copies of the documents which were
required to be delivered under the Credit Agreement as a condition to the making
of the Credit Extensions thereunder.
Except as otherwise provided in the Credit Agreement, effective as of
the date of delivery hereof
(a) the Assignee
(i) shall be deemed automatically to have become a party
to the Credit Agreement, have all the rights and obligations of
a "Lender" under the Credit Agreement and the other Loan
Documents as if it were an original signatory thereto to the
extent specified in the second paragraph hereof; and
(ii) agrees to be bound by the terms and conditions set
forth in the Credit Agreement and the other Loan Documents as if
it were an original signatory thereto; and
(b) the Assignor shall be released from its obligations under
the Credit Agreement and the other Loan Documents to the extent
specified in the second paragraph hereof.
The Assignor and the Assignee hereby agree that the [Assignor]
[Assignee] will pay to the Administrative Agent the processing fee referred to
in Section 11.11.1 of the Credit Agreement upon the delivery hereof.
Administrative information for the Assignee is set forth in Schedule II
hereto.
<PAGE> 149
This notice may be executed by the Assignor and Assignee in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute one and the same
instrument.
[ASSIGNOR]
By:
----------------------------------------
Title:
[ASSIGNEE]
By:
----------------------------------------
Title:
CONSENTED TO AND ACKNOWLEDGED:
BANK OF AMERICA, N.A., AS ADMINISTRATIVE AGENT
By:
---------------------------------
Title:
BARGO ENERGY COMPANY
By:
---------------------------------
Title:
<PAGE> 150
SCHEDULE I
TO LENDER
ASSIGNMENT NOTICE
<TABLE>
ASSIGNOR'S ADJUSTED PERCENTAGES:
<S> <C>
Commitment and Loans: __%
Letters of Credit: __%
ASSIGNEE'S PERCENTAGES:
Commitment and Loans: __%
Letters of Credit: __%
</TABLE>
<PAGE> 151
SCHEDULE II
TO LENDER
ASSIGNMENT NOTICE
ADDRESS FOR NOTICES:
Name of Assignee:
---------------------
<PAGE> 152
EXHIBIT H
FORM OF OPINIONS OF COUNSEL TO THE BORROWER
<PAGE> 153
EXHIBIT I-1
FORM OF PRE-CLOSING TITLE OPINIONS OF SPECIAL
TITLE COUNSEL TO THE BORROWER
Form of Pre-Closing Title Opinion
[Letterhead of Title Counsel]
[Date]
Bank of America, N.A., as Administrative Agent
c/o Mayer, Brown & Platt
700 Louisiana Street
Suite 3600
Houston, TX 77002
Attention: Kevin L. Shaw
PRE-CLOSING TITLE OPINION
Interests of [Bargo Energy
Company] [Future Acquisition
1995, Ltd.]1, County,
----- --------
Gentlemen:
This opinion is given in connection with the Second Amended and Restated
Credit Agreement ("Credit Agreement") dated as of September 30, 1999, among
Bargo Energy Company, a Texas corporation, as the borrower [("Borrower")]
[("Mortgagor")]2/, the various financial institutions as are now or may
hereafter become parties thereto (collectively, the "Lenders") and Bank of
America, N.A., formerly Bank of America National Trust and Savings Association,
as Administrative Agent for the Lenders (in such capacity, "Mortgagee").
Capitalized terms used in this opinion but not expressly defined herein shall
have the respective meanings given to them in the Credit Agreement.
- ----------------------
1/ Select entity as appropriate.
2/ Select entity as appropriate.
<PAGE> 154
Please refer to our [Preliminary Title Opinion] ("Title Opinion") dated
__________, 199__, covering lands more particularly described therein
(collectively, the "Lands"). In addition to the title materials examined as
listed in the Title Opinion, we have examined copies of the following documents:
[HERE LIST DOCUMENTS EXAMINED]
We are of the opinion that:
A. Fully executed originals of items _____________________ should be
filed for record in the office of the [Clerk] of _____________ County of the
State of ______________. Upon the accomplishment of such recordation and
filings, the [Borrower] [Mortgagor] will constitute, as security for (i) Credit
Extensions, including the Loans made and to be made pursuant to the Credit
Agreement and to be evidenced by the Notes, and (ii) the obligations of
[Borrower] [Mortgagor] and its Affiliates to the Lenders and their Affiliates
under Hedging Agreements to which they are or may become parties, a legally
valid and enforceable first mortgage lien on the interests of [Borrower]
[Mortgagor] in the Lands and a first perfected security interest in the interest
of [Borrower] [Mortgagor] in all accounts and proceeds resulting from the sale
at the wellhead of minerals to be severed from the aforesaid interests of
[Borrower] [Mortgagor]. No other or further filings or recordings will be
required to establish, perfect and maintain such lien and security interest,
except as expressly set forth herein, subject to our comments and requirements
set forth hereinbelow.
B. Following execution of the documents listed as items ____
_____________________ and recordation of the documents listed as
______________________________________ (in the order listed, and assuming that
no intervening adverse instruments are recorded), the interests of [Borrower]
[Mortgagor] and covered by your Mortgage, will be as follows:
<TABLE>
<CAPTION>
1. [Tract 1:] Operating Net Revenue
Interest Interest
--------- -----------
<S> <C> <C>
[Borrower][Mortgagor] --------- -----------
</TABLE>
[HERE LIST INTERESTS IN EACH TRACT]
C. Under the applicable laws of the State of _____________, including
applicable recording, filing and registration laws and regulations, no mortgage,
documentary, stamp or similar taxes are payable in connection with the
execution, delivery
<PAGE> 155
or recording of the Mortgage or the transactions contemplated thereby,
insofar as the Mortgage and the transactions relate to property located in or
subject to the laws of the State of _______________, other than statutory
recording and filing fees to be paid upon the recording and filing of the
Mortgage and related UCC-1.
D. Under the laws of the State of _______________, the priority of the
Mortgage, to the extent the Mortgage secures obligatory future advances and is a
conveyance of or creates a lien against a real property interest, is determined
by the date on which the Mortgage is recorded.
E. Under the laws of the State of _______________ and local
jurisdictions therein, there is no statutory or regulatory lien in favor of any
governmental entity for (a) liability under _________ environmental laws or
regulations, or (b) damages (including natural resources damages) arising from
or costs incurred by such governmental entity in response to the release of a
hazardous or toxic waste, substance, pollutant, constituent, or other substance
into the environment which, if not of record in the mortgage records in the
County where such lands are located, would have priority over the Mortgage [HERE
STATE EXCEPTIONS, AS APPLICABLE].
F. Under the laws of the State of _____________ and local jurisdictions
therein, there are no statutory and regulatory requirements relating to the
transfer of ownership or operation or sale of premises upon which there are
hazardous or toxic wastes, or upon which there are certain facilities which
indicate a likelihood of such wastes (except for various requirements that
regulatory bodies receive notification when an environmental permittee,
licensee, or notifier changes) which require (i) notification of the State or of
the local jurisdiction of such transfer, or sale, (ii) certification that there
has been no discharge of toxic or hazardous waste or other substances, or (iii)
in the event of a discharge, the assumption prior to such transfer of ownership,
or operation, or sale, of responsibility by the lender for the undertaking of
remedial measures to alleviate environmental contamination resulting from such
discharge.
G. It is necessary that a continuation statement be filed regarding the
Financing Statement within six (6) months prior to the end of each five (5) year
period.
This finding of title, and mortgaged interests of [Borrower] [Mortgagor]
in your favor, is subject to all unsatisfied (in whole or in part) Requirement
of the Title Opinion, as well as all limitations, comments and remarks set forth
therein and herein.
After the proper execution and recordation of the documents listed as
______________________________________, as required above, it will be necessary
to examine the Public Records of ______________________ County, _______________,
to insure that there have been no adverse alienations, liens or encumbrances
recorded or filed, or suffered to be recorded or filed, since the certification
dates of the Abstracts examined in connection with the rendition of the Title
Opinion. We will furnish you a
<PAGE> 156
Post-Closing Title Opinion after execution of the documents listed above as
_________________________________________ and recordation of the documents
listed above as _________________________________, completion of the records
search set forth above, and our examination of the documentation in connection
with same, such opinion to be substantially in the form of that attached hereto.
Very truly yours,
--------------------------
<PAGE> 157
EXHIBIT I-2
FORM OF POST-CLOSING
TITLE OPINIONS OF SPECIAL
TITLE COUNSEL TO THE BORROWER
Form of Post-Closing Title Opinion
[Letterhead of Title Counsel]
_______________, 199__
Bank of America, N.A., as Administrative Agent
c/o Mayer, Brown & Platt
700 Louisiana Street
Suite 3600
Houston, TX 77002
Attention: Kevin L. Shaw
POST-CLOSING TITLE OPINION
Interests of [Bargo Energy Company]
[Future Acquisition 1995, Ltd.]1/
__________ County, ___________
Gentlemen:
This opinion is rendered in connection with the closing under that
certain Second Amended and Restated Credit Agreement dated as of September 30,
1999 (the "Credit Agreement"), among Bargo Energy Company, a Texas corporation,
as the borrower [(the "Borrower")] [(the "Mortgagor")]2/, the various financial
institutions as are now or may hereafter become parties thereto (collectively,
the "Lenders") and Bank of America, N.A., formerly Bank of America National
Trust and Savings Association, as Administrative Agent for the Lenders (in such
capacity, "Mortgagee"). Capitalized terms used in this opinion but not expressly
defined herein shall have the respective meanings given to them in the Credit
Agreement.
- ---------------------
1/ Select entity as appropriate.
2/ Select entity as appropriate.
<PAGE> 158
Please refer to our [here list prior Title Opinion] ("Title Opinion")
dated __________, 199__, covering lands more particularly described therein
(collectively the "Lands"). In addition to the title materials examined as
listed in the Title Opinion, we have examined executed originals of the
following documents:
[HERE LIST DOCUMENTS EXAMINED]
We are of the opinion that:
A. The Mortgage constitutes, as security for (i) Credit Extensions,
including the Loans made and to be made pursuant to the Credit Agreement and
evidenced by the Notes, and (ii) the obligations of the [Borrower][Mortgagor]
and its Affiliates to the Lenders and their Affiliates under Hedging Agreements
to which they are or may become parties, a legally valid and enforceable first
mortgage lien on the interests of the ("[Borrower] [Mortgagor]") in the Lands,
and a first perfected security interest in the interests of [Borrower]
[Mortgagor] in all accounts and proceeds resulting from the sale at the wellhead
of minerals to be severed from the aforesaid interests of [Borrower]
[Mortgagor]. No other or further filings or recordings are required to
establish, perfect and maintain such lien and security interest, except as
expressly set forth herein, subject to our comments and requirements set forth
hereinbelow.
B. It is our opinion that the interests of [Borrower] [Mortgagor], and
covered by your Mortgage are as follows:
<TABLE>
<CAPTION>
1. [Tract 1:] Operating Net Revenue
Interest Interest
--------- -----------
<S> <C> <C>
[Borrower][Mortgagor] --------- -----------
</TABLE>
[HERE LIST INTERESTS IN EACH TRACT]
C. Under the applicable laws of the State of _____________, including
applicable recording, filing and registration laws and regulations, no mortgage,
documentary, stamp or similar taxes are payable in connection with the
execution, delivery or recording of the Mortgage or the transactions
contemplated thereby, insofar as the Mortgage and the transactions relate to
property located in or subject to the laws of the State of ________________,
other than statutory recording and filing fees which were paid upon the
recording and filing of the Mortgage and UCC-1.
D. Under the laws of the State of ________________, the priority of the
Mortgage, to the extent the Mortgage secures obligatory future advances and is a
<PAGE> 159
conveyance of or creates a lien against a real property interest, was
established as of ___________, 199__.
E. Under the laws of the State of ________________ and local
jurisdictions therein, there is no statutory regulatory lien in favor of any
governmental entity for (a) liability under ______ environmental laws or
regulations, or (b) damages (including natural resources damages) arising from
or costs incurred by such governmental entity in response to the release of a
hazardous or toxic waste, substance, pollutant, constituent, or other substance
into the environment which, if not of record in the mortgage records in the
County where such lands are located, would have priority over the Mortgage [HERE
LIST EXCEPTIONS, AS APPLICABLE].
F. Under the laws of the State of ________________ and local
jurisdictions therein, there are no statutory and regulatory requirements
relating to the transfer of ownership or operation or sale of premises upon
which there are hazardous or toxic wastes, or upon which there are certain
facilities which indicate a likelihood of such wastes (except for various
requirements that regulatory bodies receive notification when an environmental
permittee, licensee, or notifier changes) which require (i) notification of the
State or of the local jurisdiction of such transfer, or sale, (ii) certification
that there has been no discharge of toxic or hazardous waste or other
substances, or (iii) in the event of a discharge, the assumption prior to such
transfer of ownership, or operation, or sale, of responsibility by the lender
for the undertaking of remedial measures to alleviate environmental
contamination resulting from such discharge.
G. The Mortgage contains the terms and provisions necessary to enable
the Lender, following a default under the Mortgage, to exercise remedies which
are customarily available to mortgagees under mortgages encumbering real
property under the laws of the State of ________________.
H. The form of financing statement described in item ___ of this opinion
("Financing Statement") is sufficient in form to perfect the security interest
in [Borrower's] [Mortgagor's] interest in the Mortgaged Property not considered
real property or fixtures, to the extent that such Mortgaged Property is deemed
to be located in the State of ________________, and a security interest in such
Mortgaged Property can be perfected by the filing of a financing statement. To
the extent that the Mortgaged Property owned by [Borrower] [Mortgagor] not
considered real property or fixtures is deemed to be located in the State of
________________ and security interests in the various types of such Mortgaged
Property described in the Financing Statement can be perfected by filing in the
State of ________________ under the provisions of Article 9 of the Uniform
Commercial Code, such security interests have been perfected by filing of the
Financing Statement in the Office of the ________________ Secretary of State.
I. The Lender is not required, solely as a result of the transactions
contemplated by the Loan Documents, to qualify to do business in the State of
<PAGE> 160
________________ in order to exercise its rights under the Mortgage. Solely as a
result of the transactions contemplated by the Loan Documents, the Lender will
not become subject to any taxes or fees of any kind under the laws of the State
of ________________.
J. The payment by the Borrower and receipt by the Lender of the
aggregate principal, interest and fees to be paid, and the method of calculation
and payment thereof, pursuant to the Loan Documents is not usurious under, or
otherwise in violation of, the laws of the State of ________________.
K. Certain rights, remedies and waivers contained in the Loan Documents
which relate to the Mortgaged Property may be rendered ineffective, or limited
by applicable State of ________________ laws or judicial decisions (other than
those reflected in the qualifications and assumptions set forth herein)
governing such provisions, but in our opinion such laws and judicial decisions
do not make the Loan Documents invalid as a whole, and there exist, in the Loan
Documents or pursuant to applicable law, legally adequate remedies for a
realization of the principal benefits and/or security reasonably intended to be
provided by the Loan Documents.
L. It is necessary that a continuation statement be filed regarding the
Financing Statement within six (6) months prior to the end of each five (5) year
period.
M. This finding of title in the interests of [Borrower] [Mortgagor]
mortgaged in your favor is subject to all unsatisfied (in whole or in part)
Requirements of the Title Opinion, as well as all limitations, comments and
remarks set forth therein and herein.
Very truly yours,
--------------------------
<PAGE> 161
EXHIBIT J
ISSUANCE REQUEST
BANK OF AMERICA, N.A.
901 Main Street, 14th Floor
Dallas, Texas 75202
Telecopy: ____________
Attention: [Name]
[Title]
BARGO ENERGY COMPANY
Ladies and Gentlemen:
This Issuance Request is delivered to you pursuant to Section 4.1 of the
Second Amended and Restated Credit Agreement, dated as of September 30, 1999
(together with all amendments, if any, from time to time made thereto, the
"Credit Agreement"), between Bargo Energy Company, a Texas corporation (the
"Borrower"), certain financial institutions (the "Lenders") and BANK OF AMERICA,
N.A., a national banking association, as agent for the Lenders (the
"Administrative Agent"). Unless otherwise defined herein or the context
otherwise requires, terms used herein have the meanings provided in the Credit
Agreement.
The Borrower hereby requests that on _________, 19__ (the "Date of
Issuance") you 3/[issue a Letter of Credit on ______________, 19__ in the
initial Stated Amount of $_______________ with a Stated Expiry Date (as defined
therein) of ______________, 19__] [extend the Stated Expiry Date (as defined
under Irrevocable Standby Letter of Credit No.__, issued on
__________________________, 19 __, in the initial Stated Amount of
$______________) to a revised Stated Expiry Date (as defined therein) of
_________________, 19__].
- ----------------------------
3 Insert as appropriate.
<PAGE> 162
The beneficiary of the requested Letter of Credit will be
4/_______________________________, and such Letter of Credit will be in support
of 5/________________________________.
The Borrower hereby acknowledges that, pursuant to Section 6.3.2 of the
Credit Agreement, each of the delivery of this Issuance Request and the
[issuance][extension] of the Letter of Credit requested hereby constitutes a
representation and warranty by the Borrower that, on such date of [issuance]
[extension] all statements set forth in Section 6.3.2 are true and correct in
all material respects (unless such statements relate solely to an earlier date,
in which case such statements shall be true and correct as of such earlier
date).
The Borrower agrees that if, prior to the time of the 6/[issuance]
[extension] of the Letter of Credit requested hereby, any matter certified to
herein by it will not be true and correct at such time as if then made, it will
immediately so notify the Administrative Agent. Except to the extent, if any,
that prior to the time of the issuance or extension requested hereby
Administrative Agent shall receive written notice to the contrary from the
Borrower, each matter certified to herein shall be deemed to be certified at the
date of such issuance or extension.
IN WITNESS WHEREOF, the Borrower has caused this request to be executed
and delivered by its duly Authorized Officer as of __________ __, 19__.
BARGO ENERGY COMPANY
By
-------------------------------------
Name:
Title:
- ---------------------
4/ Insert name and address of beneficiary.
5/ Insert description of supported Indebtedness or other obligations and
name of agreement to which it relates.
6/ Complete as appropriate.
<PAGE> 1
BARGO ENERGY COMPANY
FIRST AMENDMENT TO
SECOND AMENDED AND RESTATED SHAREHOLDERS' AGREEMENT
This First Amendment ("Amendment") to the Second Amended and Restated
Shareholders' Agreement is effective for all purposes as of August 11, 1999, and
evidences the following:
WHEREAS, B. Carl Price, Don Wm. Reynolds, Energy Capital Investment
Company PLC, an English investment company, EnCap Equity 1994 Limited
Partnership, a Texas limited partnership, BER Energy Resources, Ltd., a Texas
limited partnership (formerly Bargo Energy Resources, Ltd.), TJG Investments,
Inc., a Texas corporation, BEC Energy Company, a Texas general partnership
(formerly Bargo Energy Company), Tim J. Goff, Thomas Barrow, James E. Sowell,
BOC Operating Corporation, a Texas corporation (formerly Bargo Operating
Company, Inc.), EnCap Energy Capital Fund III-B, L.P., a Texas limited
partnership, BOCA Energy Partners, L.P., a Texas limited partnership, EnCap
Energy Fund III, L.P., a Texas limited partnership, Kayne Anderson Energy Fund,
L.P., a Delaware limited partnership, BancAmerica Capital Investors SBIC I,
L.P., a Delaware limited partnership, Eos Partners, L.P., a Delaware limited
partnership, Eos Partners SBIC, L.P., a Delaware limited partnership, Eos
Partners SBIC II, L.P., a Delaware limited partnership, and SGC Partners II LLC,
a Delaware limited partnership, entered into the Second Amended and Restated
Shareholders' Agreement, dated May 14, 1999 (the "Agreement");
WHEREAS, the parties to the agreement desire to amend the agreement as
herein provided;
NOW THEREFORE, the parties hereto, for good and valuable consideration,
intending to be legally bound, hereby agree as follows:
Section 1. DEFINED TERMS. The terms capitalized herein have the meanings
given to them in the Agreement, unless otherwise defined herein.
Section 2. BOARD OF DIRECTORS.
(a) The first sentence of Section 2(a) is hereby replaced with the
following two sentences: "For so long as any of the Preferred Shares remain
outstanding: each of (i) EOS, (ii) Kayne and (iii) BACI (or the successor or
transferee of any such party), shall be entitled to name one (1) Designated
Nominee for Class III of the Company's Board of Directors; the Bargo Group
(including successors and transferees of its members) shall be entitled to name
two (2) Designated Nominees, and SGCP shall be entitled to name one (1)
Designated Nominee, for Class II of the Company's Board of Directors; and EnCap
(including successors and transferees of its members) shall be entitled to name
two (2) Designated Nominees for Class I of the Company's Board of Directors. In
addition, for so long as he is an employee of the Company, Jonathan M. Clarkson
shall be a Designated Nominee in Class I of the Company's Board of Directors."
<PAGE> 2
(b) Section 2(b)(i) of the Agreement is amended to read in its entirety
as follows: "(i) to use its reasonable best efforts for so long as Jonathan M.
Clarkson is a Designated Nominee to cause Company's Board of Directors to be
composed of eight members and for so long as Mr. Clarkson is not a Designated
Nominee to cause the Company's Board of Directors to be composed of seven
members".
Section 3. NO OTHER CHANGES. This amendment shall be incorporated into
and deemed part of the Agreement as if fully set forth therein. Except as
expressly set forth in this Amendment, all other terms and provisions of the
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, this Amendment was executed as of the date above
first written.
BARGO ENERGY COMPANY
By:__________________________________
Name: Tim J. Goff
Title: Chief Executive Officer
ENCAP EQUITY 1994 LIMITED PARTNERSHIP
By: EnCap Investments L.C., General Partner
By:__________________________________
D. Martin Phillips
Managing Director
2
<PAGE> 3
ENERGY CAPITAL INVESTMENT COMPANY PLC
By:__________________________________
Gary R. Petersen
Director
TJG INVESTMENTS, INC.
By:__________________________________
Tim J. Goff
President
BEC ENERGY COMPANY
By:__________________________________
Tim J. Goff
Manager
BER ENERGY RESOURCES, LTD.
By: BOC Operating Corporation
General Partner
By:__________________________________
Tim J. Goff
President
3
<PAGE> 4
BOC OPERATING CORPORATION
By:__________________________________
Tim J. Goff
President
_____________________________________
Tim J. Goff
_____________________________________
Thomas Barrow
_____________________________________
James E. Sowell
_____________________________________
B. Carl Price
_____________________________________
Don Wm. Reynolds
ENCAP ENERGY CAPITAL FUND III, L.P.
By: EnCap Investments L.C., General Partner
By:__________________________________
D. Martin Phillips
Managing Director
4
<PAGE> 5
ENCAP ENERGY CAPITAL FUND III-B, L.P.
By: EnCap Investments L.C., General Partner
By:__________________________________
D. Martin Phillips
Managing Director
BOCP ENERGY PARTNERS, L.P.
By: EnCap Investments L.C., Manager
By:__________________________________
D. Martin Phillips
Managing Director
EOS PARTNERS, L.P.
By:__________________________________
Name:___________________________
Title:__________________________
EOS PARTNERS SBIC, L.P.
By: Eos SBIC General, L.P., its general
partner
By: Eos SBIC, Inc., its general partner
By:__________________________________
Name:___________________________
Title:__________________________
EOS PARTNERS SBIC II, L.P.
By: Eos SBIC General II, L.P., its general
partner
By: Eos SBIC II, Inc., its general partner
By:__________________________________
Name:___________________________
Title:__________________________
5
<PAGE> 6
SGC PARTNERS II LLC
By:___________________________________
Name:____________________________
Title:___________________________
BANCAMERICA CAPITAL INVESTORS SBIC I, L.P.
By: BancAmerica Capital Management
SBIC I, LLC, its general partner
By: BancAmerica Capital Management I,
L.P., its sole member
By: BACM I GP, LLC, its general partner
By:__________________________________
J. Travis Hain
Managing Director
KAYNE ANDERSON ENERGY FUND, L.P.
By:__________________________________
Name:___________________________
Title:__________________________
6
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