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HomeMy WebLinkAboutFranwin Oil and Gas Company - 1963-02-20... .' .. .r 4.-i.f,t �'u... .... nw •,•y rvr. .v •vt wr .. a ..... .... .w . .w. ..w. , •r-w�w .f• 5H•�f 1:Y2 .r ,. L.. M j1�`. 11 �f SUBSURFACE COWRN1 ITY CIL AND GAS LEASE HIS AGREEMENT, made this co day of , 19by the lessors and signers hereof execut ng t agree- men`as first parties and describing in connection wi -h and above their respecti:*e signatures on the signature page hereof, the respective: property owned by each, hereinafter sometimes called Lessors, and W. S. Payne, Jr., doing business under the firm name of Franwin Oil and Gas Company, second party, herein- after sometimes called Lessee. WITNESSETH : WHEREAS, Lessee is in the process of negotiating a Unit` Agreement dated June 4, 1962 , entitled "Unit Agreement for the Jones Sand Zone ana Stray Sand Zone, Huntington Avenue Area of the Huntington Beach Oil Field, Orange County, California", hereinafter referred to as said Unit Agreement, a copy of which has been delivered to Lessor, and WHEREAS, Lessor's said property is located within the Unit Area subject to said Unit Agreement, and WHEREAS, Lessors believe that their interests will be beat furthered and conserved by joining their respeot:ive properties in this "Subsurface Community Oil and Gas Lease" under the terms of which their said property may be jointly operated with other properties subject to this lease for oi?, gas and kindred sub- stances as a Tract subject to said Unit Agreement, and all Lessors may share In the royalties on oil. and gas allocated to this lease under said Unit Agreement, and they now desire to "pool" their interests in such manner: NOW, THEREFORE, in consideration of the sum of One dollar ($1.00) and in consideration of the agreements hereinafter specified it is hereby agreed as follows: (1) Lessors, as to the lands hereinafter described in connection with and above their respec"ALve signatures, each for himself and with all of -the others do hereby lease unto Lessee exclusively the real property described above the names of each of said Lessors for the purpose of operating for oil, gas, gasoline and other hydrocarbon substances and taking, removing and disposing of same with the right to use for such purposes, and without cost to Lessee, such oil, Ras and water from said land as may be necessary oz, convenient in Lessee's operations -1- I x 11 N .t a .. I� X and in producing oil and gas from said premises, together with every other right and privilege incidentlal to tha use oi' said land in connection with the operating, producing and marketing oil and gas or tl­e hydrocarbor, substances produced; all upon the terms, ,ovenants and conditicns hereinafter contained. (2) Lessor warrants, covenants and agree-s that Lessor owns the oil and gas rights in the property described above his signature hereto and Lessee's possession of the demised premises shall be continuous, sole and exclusive. (3) ?1r.saec' shall .hold thfa demised premises for a priinai•y term commencing with the date hereof Arid continuing until August 2, 1963, suk�,leet t�� extension for a s1. (3) montii pe iod as provided for In Section 6 .hereof, and in the eve rt said Unit Agreement. shall becuine effective and this lease is committed W said Unit '.Agree hint by Lessee, with=n :said primary term, or sip extended, then notwithstanding anything to the contrary contained in said Unit Agreement, this lease shall continue in effect'lo.r a period of ten (10)'years, after the end of said primaryterm and shall terminate at that time and shall have no furtherforce acid effect. IYowe;ve, If said Unit Agreement. is.still. in'effect at the end of said ten (10)year terux, Lessor and not the Les see .rnay, at its option, extend the term of this lease for . • h ieriod as. Lessor may desire so long the e after as said 'Unit Agrocment shall remain in force and effect. Notwithstanding any prov*isions to the contrary in the 'Jnit Agreerne this provision shall be and is controlling, r' ♦.�♦ r•. 1.ar♦4, l/ W WV V ,1V l/ U %.'f111 L 1. 41. U t • r.. V\! �11 h,%*.L rl v ♦`.r WA. %A%AJ. J 4- 1964, Lessee shall surrender and terminate thi l.eaoe. (6) In the event said Unit Agreement has not become effective on or L-ef'ore August 2, 1963 and in the further event that Lessee shall deterr;iine that there is a reasonable pcssi-- bi.lity that said Unit Agreement may become effective within t3 period of six (6) months alter August 2, 1963, Lessee shall have the right at any time prior to Auggus `. 2, 1963 to extend the primary term of this lr�ase For an additional six (r)') month period by so notifying the Lessors and paying to the Lessors of each separate lot or, parcel of land then subject to this lease the surf of One dollar ($1 . JQ) . (j) The expression "royal.ty share" when used i.n this lease shall mean the .fraction one -quarter (1/4). Lessors' collective crude oil royalty shall bn- the royalty share of all the oil allocated to the demised premises pursuant to the provisions of raid lln A.t Agreement. Lessee shall purchase or �.._.._..a..lt_..,..�....._....�...,,._ .�. -2_ and in producing o:ll and gas from said prem:l.:e , together with every other right a.nd privilege incidental ';o the use of Said land in connection with the operating, prodlic.ltig and markei,in nil and gas or the nydroearbo►� subs tankoes produced; all upon the terms, covenant,. and conditions hereinafter contained. (�2) Lessor warranto, covenants and ag:rees that Lessor owns the oil. and gas rights in the property described above his signature :-:eret:a :end L�es,�ee's possession of the demised premises shall be con:tinuQ�.:s, sole and exclusive, ---Le 5 e EA $i� �,.., �� ,. �. '��e���em, I-ae a ... ^ems-a---p ►1 erm•'Zro:.ne ring with the date r ereof and continuin%,.u4J.-tT' ugust 2, l 5- ,--aubject to extinsion 'or a s;Lxr mo;'ith ,ey,.r, iod ais:provided �'t�4'prip-,s sect on1•�v_- vpeyU'i f;��~and in the event veent c./y V itJted to said Unit A,�e, nt I e "mes.. , within said primary ei-n, or with,r..--arxrd�prirlary t r;� as s4� exr,ethen this ease 1-1 continue so long t ereafter as aa:ld Un-Tt-��4� zeTmen r (tf) Lessee shall have no obligation inereunder. either express, or implied, to d4-111 any well Into the denilsed :)rernises; -provided, however, Lessee may drill one or .pore: wells into the cIenisrd premises if Lesace �hould elect to do so. Lessee' a , operating obligations hereunder shall be only these expressed An raid Unit Agreement insofar as theA a.pp? y to the demised premises. Lessee shall have the right! to water.f food tba ; Unitized Formations within ti-ie demised premises, Lessee may at any tine surrender said property or >j ar.y part thereof' by reC,ording good and sufficlent gUitClaim , deed tharefor, and thereupon all rights and oL•ligatiuns of Lessee as to the parcels of land. so quitclaimed shall cease anci terminate as between Lessee and all. Lessors owning the pro- :rf perty so surrendered or qu tc:lal.med . In. the event said Ur it Agreement does not become effec%ivr� oln or before .February 2, 19611, Lessee shall surrender. and terminate this lease. (6) In the event said Unit; Agreemenhas not become .r effective on or before August 2, lgo:; and in the flArther event that Lessee shall determine that thero is a reasonable .po.ssi-- , bility that said Unit Areement may become effective within a period of six (6) ►nonths after August 2, 1963,. Lessee shall have the right at an,, time prior to August 2, 1963 to extend ..; the primary term of L-1)ls lease for an =dditional six (6) month st. perio9 by so notifying the Lessors and paying to the Lessors of ea,,h separate lot or parcel of land then u'ubject to this . lease the suns of One dollar 41.00). (7) 1he expression "royalty snare" when used in thl.s � lease ,,jhall mean the fraction one -quarter (1/4) . Lessors' , collective crude oil royalty shall be the royalty share of all the oil allocated to the demised premises pursuant; to ::he provisions of said Unit Agreement. Lessee shall purchase or .t ,u --2 -- s i t r�a�-rvi'Vs' a xsns J"Wo"n�rae s1M.110 tmerrn I ` . f t sell Lessors royalty oil at the market value in the ,game � field for oil of similar gravity and quality, after making correction for temperature and customary deductions for crater and other foreign substances therein. (8) In case of sale by Lessee of gas allocated to the a demised premises pursuant to the provisions of said Unit Agreement In the natural state as produced Lessee shall pay Lessors collectively in cash the royalty share of the net pro- ceeds of such sale received by Lessee. Ire case Lessee delivers such gas to a third party for treatment, Lessee shall. pay Lessors collectively (a) the royalty share of the market value of the net natural gasoline redelivered to Lessee and (b) the "Liquefied royalty share of the market value of the net petro- leumgases redelivered to Lessee and utilized by Lessee (in excess of the amount herein allowed to be used by Lessee free A of royalty) and (c) the royalty share of any net proceeds received by Lessee from the sale of liquefied petroleum gases redelivered to Lessee after deducting the royalty share of the '. coat of delivery for sale and (d) the royalty share of any net y proceeds received by Lessee from the sale of residual dry gases redelivered to Lessee and (e) the royalty share of the market value of residual dry gas redelivered to Lessee and utilized by Lessee (in excess of the amount herein allowed to be used by Lessee free of royalty). Nothing in this agreement contained shall require Lessee to save or market gas allocated to the demised premises unless there shall be a surplus above lease requirements and a market at the well for same. (9) If Lessee shall extract in a plarit awned or operated by it natural gasoline and/or liquefied petroleum gases from the gas allocated to the demised premises pursuant to the pro- visions of said Unit Agreement, Lessee shall pay Lessors collec- tively as royalty the royalty share of forty per cent (4p%) of the natural asoline so extracted and the royalty snare of forty per cent (44) of any liquefied petroleum gases so extracted and sold by Lessee or utilized by Lessee (in excess of the amount herein allowed to be used by Lessee free of royalty) - Lessee shall not, however, be required to extract any of said products. This royalty shall be payable in cash and royalty on natural gasoline shall be based on the market value thereof, and the royalty on liquefied petroleum gases utilized by Lessee (in excess of the amount herein allowed to be used by Lessee free of royalty) shall be based on the market value thereof, Royalties on liquefied petroleum gases s.nld by Lessee shall be based on the. net proceeds of such sales after deducting the royalty share of the cost of. delivery for sale. If the residual dry gas is sold by Lessee, Lessee will pay Lessors collectively as royalty thereon the royalty share of the net proceeds received by Lessee from the sale of such residual dry gas. If residual dry gas is utilized by Lessee (in excess of the amount herein allowed to be used by Lessee free of royalty) Lessee will pay Lessors collectively as royalty thereon the royalty share of the market value thereo:`. _3.. �..,_. ...... �., �� ... .._ .....� r.. i ft 4 Lessee shall have the right to deduct from Lessors' royalty on any gas produced hereunder the royalty share of the cost:, if any, of compression for delivery, transportation and/or delivery thereof. Lessee shall have the right to corruningle gas allocated to the demised premises with other gas and thereupon the royalty shall be computed upon an appropriate fraction of the commingled gas. (10) When unpaid cash royalties ac:.ruing hereunder to any Lessor equal or exceed $25.00 at the end of any calendar month such royalties shall be paid by Lessee to such Lessor o'r1 or before the end of the next succeeding rnatith, and, for this purpose, Lessee shall keep true and correct books of accounts showing the allocation of said substances to said premises, and, these records shall be open uo inspection of Lessors at all reasonable times. Settlement thereof shall be made between the partieu hereto on or before the last day of each calendar month. (11) All payments due hereunder to Lessors may be made by paying the saine into the Citizens Nat -loyal Bank of Los Angeles, Los Angeles, California, and such deposits shall re- lieve Lessee from .geeing to the proper distribution thereof among the several Lessors or among any parties holding any interests under Lessors. (12) The operating requirements of this lease shall be susperided while, but only so long as Lessee is prevented from complying therewith, in whole or in part, by strikes, war, lockouta, acts of God, inability of Lessee to obtain material or supplies from manufacturers or dealers in reasonable time after bona fide attempt and order, delays in transportation, interference by any delay in obtaining necessary permits from Federal, State, County, or other governmental authority; and accidents or other matters beyond control of Lessee. (13) Lessee shall pay before delinquent all taxes levied against the improvements, plants, machinery and personal pro- perty includin oil in storage belonging to Lessee and also one --fourth (1/nth) of the increase in Lessors' taxes caused by the operations of Lessee under this lease above the amount at present assessed. Lessors shall pay all of personal pro- perty tax on Lessors' royalty oil in storage When assessed. Mining rights taxes shall be shared three -fourths (3/11ths) by Lessee and one --fourth (1/14th) by Lessors. Lessee may pay any of Lessors' taxes and/or assess-ments and deduct from next royalty u•a- to such Lessors or require payment therefor. (14) The amount of any and gull valid expenses, obligations, or liabilities chargeable to or payable by Lessors under the terms of this lease, including expenses of protection of title or possession, expenses of treatment of royalty oil, amount of adverse claims, encumbrances or liens caused or suffered by Lessors upon the demised premises and Lessors' share of taxes, may be paid by Lessee out of and deditsted from Lessors' rent . ........ .... ... ... ..•,r...,w� .w.ew+. Fr.�rw... -,.. ., ,,.. :... .. t .. .. ,.... .. -.. _ �+ u(�.... a ..... a.wl+',..•y,�yri .. .. .... 1 r or royalty accruirir, hereunder, or may be advanced by and at the option of Lessee on Lessors' behalf when due and by ;.assee on demand, either recovered frorn Lessors or deducted from Lessors' rent or royalty accr.u-tng hereunder. If such adverse claim, lien or encumbriince upon the demised premises is likely in any manner to interfere with, impair or prejudice Lessee's rights under the terrn4 of this lease, Lessee is authorized and em- powered, at Lessee's option, to acquire, pay, discharge or re- deem same in the event of default of payment by Lessors, and thereupon Lesc ee shall be subrogated to all rights of the pre- vious holder or holders thereof. (15) Lessee shall pay any damage done to any improvements upon the land hereby leased caused by Lessee's operations here- under, such damage to be paid to the Lessor_ cr Lessors who have been so damaged. If Lessee and said parties cannot agree upon the amount of said damage, the same shall be determined by a board of arbitrators, one to be selected by such Lessors, a second by Lessee and a third arbitrator by the two so selected. The findings and award of said arbitrators shall be binding and conclusive upon the parties hereto. (1.6) Each of the Lessors respectively covenant and warrant to Lessee, as to the property owned by the respective Lessors, that said real property is free and clear of all encumbrances except liens, charges, mortgages or trust deeds of record and each of Lessors as to their respective parcels warrant to Lessee peaceable possession during the term. of the lease. Lessors consent to the subordination to this lease of any mortgage or lien now upon said land. Lessee at Lessee's option may pay or discharge any takes, mortgages, trust deeds, contracts or liens existing, levied or assessed on or against said real prc,-- party, (11) Lessee shall have the right to remove from time to time from any portion of said premises all machinery, pipe, casing, lines, tools, pumps, and other property, fixtures or im- provements belonging to or furnished by Lessee, provided that such removal shall be completed during three (3) months after the termination of, the leasehold as to such portion of said premises. (18) All labor 1:orformed and material furnished in Lessee's operations hereunder s'oall be at the cost and expense of Lessee, and Lessors shall. not be chargeable, nor liable for any part thereof, and during the life of this lease Lessee shall keep the demised premises and Lessors fully protected against liens of every character arising from, or connected with, Lessee's operations hereunder. Lessors may at any time or times post upon the demised premises such notices as Lessors desire for the purpose of protecting said property and Lessors' title thereto from and against all liens. (19) Lessee shall at all times upon demand, protect, in- demnify, defend and reimburse Lessors against and for any and -5- 4 i� � � �✓:+.+..�w.w. , „.i. � - ... .. •4 .(._ .♦ w. � .., w?'"�.YL'+ _ - .. ._ v .�.. .. ...ws. � .. ._ i �. .. d. w�.i. ..J_�. ..++.1-w..�,+ ft ^ all claims, demands or liabilities and reasonable costs and expenses incident to any personal Injury or property damage -Ing from Lessee's operations hereunder. to other parties result.L (20) After thirty (30) days notice in writing from Lessors to Lessee to remedy any breach of this contract and upon failure of Lessee then to reniedy such breach., Lessors may terminate this lease without further notice; PROVIDED, only fifteen (15) days notice shall be required for failure to pay any royalty due. Lessors; and provided further, the right to operate a producing well can only be terminated by a breach of some requirement directly relating to, connected vilth or arising from, operation of such well. Should Lessee at any tinie assign this lease as to all or part of the leased premises or ente.-, into a sub -lease or contract with others for thie development, drilling and/or operation of any portiori thereof) the default of any such assignee or Gub-lessee shall affect only the pro- perty assigned or sub -leased and shall not constitute a default s any of the remaining portion of said premises other than the property embraced in said assignment, sub -lease or contract. (21) Upon expiration or sooner termination of this lease,, Lessee will execute good and sufficient quitclaim deed for land hereby leased and then retained by Lessee. Such quitclaim deed ,,hall run In favor of LesSors as their respective interests appear cf record or t-o the successors in interest, grantees., heirs or assigns oV said respective Lessors, and such quitclaim deed when recorded 'shall conztitute a complete surrender., termination and cancellation of this lease not only of �he leasehold estate created thereby and then retained by Lessee, but as between the respective Lesscrs; and as and when such quItclaim. deed Is re- corded each of the Lessors thereby reciprocally quitclaim, remise and relinquish In favor of each of the other of said Lesl�ors all of their respective right.. title and interest, if any, acquired hereunder in and to the par�:els of real property of each other., and no further instrument shall be required among said Lessors to terminate said lease as far as the interest of Leasors is (22) Obligations of Lessors to Lessee hereunder shall be several and not joint, and the obligations of the respective Lessors shall be only such as directly arise from the parcel or parcels here leased by the respective Lessors. (23) Lessors may give any notice or deliver any statem-.,nt to Lessee by mailing the same by registered or certi- .5 fied or ordinary mail addressed to Lessee at 3851 Long Beach Boulevard, Long Bea.-..h 7, California, or by delivering the same In person to Lessee. Lessee may give any notice or deliver any document hereunder to Lessors by mailing the same by regiatered or certified or ordinary mail addressed to Lessors at the address set forth under his signature hereto. or by delivering the same to any Lessors In person. For the purposes of' this paragraph either party may change its address by written notice to the other. In case of any notice or document delivered by mail the same shall be deemed delivered when deposited In any United States post office, or mail box, sub-po3t office, sub- � - ~ ~' station, or mail chute, or other like facility �agular:.�,� ��ain- tained by the Government of the United States, properly addressed as herein provided, with postage fully prepaid. .,. (24) if it should appear at any time that any Lessor at the tome of executing this lease owns a less interest in his respective property than the whole undivided fee in the oil, gas, and the aforesaid other substances in, under, or which may be recovered from his respective property, then the royalties and rentals shall be paid said Lessor only in the proportion which his interest in said oil, gas, and aforesaid other sub- stances bears to the whole undivided fee therein. If any Lessor hereafter acquires any additional interest or title in his respective property then this lease shall cover such addi- tional after -acquired interest or title. (25) If any Lessor shall sell or transfer any part or parts of his respective property or an;' interest in the oil anal/or gas and/or any of the afc�,esaid other substances under any part or parts thereof, Lessee's rental and royalty obliga- tions shall not thereby be altered, increased or enlarged, but Lessee may continue to operate such property, and pay and settle rents and royalties, as an entirety, (26) This lease may be executed in any number of counter- parts, by any person having an interest in a parcel of land, with the same effect as if all Lesscrs herein were named as Lessor in one document and had all signed the :same document. All counterparts shall be construed together and shall consti- tute one lease. The failure of any person owning an interest in such parcel oz' land to execute a counterpart hereof, or the failure of any person named as Lessor in any counterpart to execute the same shall not affect the binding force of this lease as to those who have executed or shall execute a counter- part hereof. (27) The term of this lease as herei.riabove set forth shall apply to any interest leased hereunder by a party or parties whose powers in respect to leasing; are not limited or restricted by law. The term of this lease in respect to any Interest leased hereunder by a, guardian, executor, or admini- strator of an estate, municipality, public corporation or other party whose right to lease is limited or restricted by law shall be limited to a period authorized by law, and any such interest shall be a part of the demised premises only during such autho- rized term unless, during such pericd, 'the term is extended by appropriate instru;nent or by operation of law, in which event the interest affected by such extension shall continue to he a pars: of the demised premises for the extended period. Any counterpart of this lease executed by any party whose right to lease is limited or restricted by law may set forth the term for which such party joins in this lease and refer to the court order or other authority aut0horizing, his execution of this lease. -7- • f (28) Any party ownl'.ng an interest in real property lo- cated within the Unit Area subject to said Unit Agreement shall be entitled to join in this lease until one (1) year after the effective date of said Unit Agreement. Until such time Lessee may cause additional lot: or properties within said Unit Area to be :Included in thi.l lease, by the same Lessors who theretofore have joined therein or by others, not -- withstanding the fact that this lease or one or more of its counterparts t;tay have been recorded one or more times. However, there shall be no retroactive adjustment of allocated Unitized Substances or of royalties payable hereunder by reason of the Joinder herein of any lot or property subsequent to the ef'-L'ec-- tive date of said Unit Agreement. (29) If in Leooce's cpinior• any dispute or uncertainty exists as to the party or parties entitled to receive any such payment, or any part thereof, Lessee may, without incurring any liability of any kind or character, urithhold payment of any amount as to which such dispute or uncertainty exists, pending the determination of such dispute or uncertainty, or may inter - plead the claimant:, and thereupon the payment into court by Lessee of any Such amount or amounto shall be deemed a compliance with the provisions of this lease with respect to such payment. Notivithetanding actual or constructive knowledge or notice thereof by Lessee, rio change in the ownership of said land or oil and gas or other substances covered by this lease, and no assignment of rents or royalties hereunder ;hall be effective as to Lessee for any purpose until the first day of the calendar r:ionth following the day on which Lessee has been furnished with either can original recordable instrument or a certified copy of a recorded original o.i the instrument which sufficiently evi- dences such change of ownership. (30) The collective royalties tinder this Lease shall be divided among and ovined by the respective Lessors according to the proportion which the area of the lots herein leased by such Lessors, respectively, bears to the total area embraced by this lea ;e as shown by the re ,ovded map or maps of such lots, and in making this commutation one-half of the area of any street or alley adjacent the lot shall be included and credited to that lot. In connection with royalty provided for, the Lessors in this lease, the lands covered by this lease shall be consi- dered as a whole and each Lessor shall be entitled to his said proportionate part of said royalty. 13ur.re:nder or quitclaim of any portion or portions of the land leased 'hereunder shall not operate to deprive the Lessors of the land so surrendered or quitclaimed of their right to continue to participate in the royalty derived from oil and gas allocated to this lease. In event that any particular part of the land hereby leased shall be so quitclaimed or surrendered and thereafter developed ,for oil or gas purposes by any other party, each and all of the Lessors shall be entitled as against the other LE.3sors to their respective proportions of royalty ov ether compensations re- ceived therefor or therefrom In the proportions aforesaid, it _$_ 1 5 +/ 'P/A •rT/5�'ar •. ••, !',YN',,,y'r.. n . .r+t� n..r .., ,-..t. ... .. n•.a....nr ...�. ..,... ..., R+•w«. ., ........ ,,...w ........... .., ...,... ,... ..... ..... ..... .. ��...........,.,..............._..............«...._..........._...-...,..,.... _. �.. _.. «._..�... �.."..._._... ..._._ ... .. being the intention and agreement of the Lessors to unite fully for the period of the life of this lease their respec- tive reversionary interests in the oil, gas and other hydro- carbon deponits in all said land so that while this lease -emains in effect such operations may be continued on the said entire tract to the same advantage and With the same effect as between said Lessors as though said land subject thereto were all under one ownership. (31) Subject to the provisions of Section 29 hereof, any transfer, conveyance or assignment (whether voluntary or by operation of law or otherwise), or hypothecation (whether by mortgage, deed of trust, pledge or otherwise) of all or any part of the oil. and gas rights in the demised premises, or of the Unitized Substances allocated to this lease, shall, unless otherwise expressly provided in such Instrument, without any other act or further agreement on the part; of any Lessor, trans- fer, convey, assign or hypothecate, as the case may be, that portion of the collective royalties under this lease allocable to such interests so transferred, conveyed, assigned or hypothe- cated, and the transferee, assignee or purchaser on any such transfer, sale or assignment, or sale upon foreclosure, or sale under trust shall succeed to all interests and be bound by any obligations under this agreement attributable to such interests so transferred, conveyed, assigned or hypothecated. (32) Each Lessor has executed an extra copy of the Lessor's Signature Page attached to this lease, and it is here- by agreed that such Lessor's Signature Page may be attached to an identical copy of this Subsurface Community Oil and Gas Lease, together with other :signature pages from other identical counterparts hereof executed by other Lessors, for the sole purpose of recording the same in the official records of the County in which sa:.d land is located. (33) Lessee is hereby given and granted the right, at any t1me within the primary term of this ?ea;je or any extension of said primary term at the Lessee's sole option to commit. this lease, and said demised premises and Lessee's and each Lessor's Interest therein and in the oil and gas to be produced pursuant to the provisions of this lease, to said Unit Agreement. Lessee's joinder in zaid Unit Agreement as to Lessee's interest In this lease shall automatically, and without further act on the part of Lessors commit each of the Lessor's intevest i:: this lease and In the oil and gas to be produced pursuant to the provisions of this lease to said Unit Agreement. By e.,KociAtIng this lease each Lessor does hereby join in and commit its said interest; to said Unit Agreement with the same force and effect as if each Lessor cr their successors in Interests had peroonally executed said Unit Agreement as Royalty Interest owners. (34) This '.ease and all its terms, conditions and s tj pu-- lations shall inure to the bene it of and Wiall extend to and M I .J c`: S r i be binding upon the heirs, executors, administrators, grantees, successors and assigns of the parties hereto. IN 14 TNT -SS WHEREOF) the parties hereto have caused this agreement to be duly executed as of the date frst _n- nab;Te written. z f// ?: S. Payne,Jr,:, Abing b iness under the firm n of Fr nwin Oil and Gas Company, Lessee CITY OF HUNTINGTON BEACH, ,. Meyo ATTEST: J i ty Clerk -r .r } t., .4. .d !i i :it i1 :,N,I:Y I I A i �i — 10— It'+T±m3t1M.Y[:7RT.h'M�:MAt1�.:.:.lkNtaL�'7f4'"�!Z'. e't'St^*}MT•!!!R�rl'K.l �l `4,t•.+.tp'C11tft75Kt'S7f�2C2S�l.KMltll:YMrtlKOR2t1.'LIL _ .l"�i?�1L�91 1 STATE OF CALIFORNIA J ss, COUNTY OF LOS ANGELES ) On thindays of`¢,f�-�.c.�.�c- , in the year 1963, before me e • • a PfEary Public irl and for aald County an tat ., personally appeared W. S. Payne, Jr., known to me to be the person whose name is subscribed to the within instrument, and acknowledged to me that he executed the same. IN WITNESS WHEREOF, I have hereunto set my hand and affi:ced my official seal the day and year in this certificate first above written. 14r �t Vo 4ar;l u n and for saldt County and State. My Commission Expires 6CY=ii'_f 4 pt-xEL (, Nata-1 ru�;ic in and (or this County of Lot !, g0ti, State of Califotnia My Co nmission Erpittt Auqutl )t 1966 STATE OF CALIFORNIA ) ss COUNTY OF ORANGE ) On this day of February, 19631 before me, a Notary Public, In and for said County and State, personally appeared ROBERT N . LAMBERT known to rose to be the Mayor and PAULC. JONES , known to me to be the City Clerk of the City of Huntington Beach tt the Municipal Corporation thn t executed the within Instrument and known to me to be the person who executed the within instrument on behalf of the mumcipal corporation named herein anti acknowledged to me that such muni- cipal corporation executed the witbin instrument on behalf of said municipal corporation. A.LICE M. i;AMILT N, Notary Public in and for the County of 0!,,-ange, State of CnI i fornia. My commission expires 3/11./63 f �''r. i:'I,�i..'�..I a,M.N,t "%Y•vt tt.M`, v.-y.wf i.�:^'s5e vxM r..., .+. �. ,.«...,. ' ..• ............ .....v .. ,.. ....« -..� .......». .... .. .. - ... ..... ..... r..."«w.w.rr� ..VMVwl+.4i LESSOR'S SIGNATURE PAGE TO SUBSURFACE CO101UNITY OIL AND GAS LEASE DATED -e o , ENTERED INTO WITH W. S. PAYNE3 JH...,-fD0111#_'G BUSINESS UDDER THE FIRM NAPIE OF FRANWIN OIL AND GAS COMPANY ALL THAT PORTION OF THE 1ANDS LYING BELOW FIVE HUNDRED FEET (5001) FROM THE SURFACES OF: Lot(-Q) B1.ock Tract The southwesterly 200 feet of Block 405, Huntington Beach Tract, Main Street Section. As per reap recorded in Book 3 , Fare 43 of 14aps, Official Records, Orange County, al�i forn a, wh ch real pro-- perty is located within the boundaries of the Unit Area sub- ject to that certain Unit Agreement dated entitled "Unit Agreement for the Jones Sand Gone and Stray Uand "Lone, Huntington Avenue Area of the Huntington Beach Oil Field, Orange County, California". Rental for first year paid and receipt acknowledged. WITNESS LESSOR 14AILING ADDRESS DELIVERY DATE ......'..,..,.i,.. .. .ram ,....,,„..�..,»:.... .... .... .... ..:. ' -:.:. _......, . .,4sar.:..,.«✓ _ ..... .......... ....__ ... _ .. .,.. .»..._, ,..w.. I S`1'AM, OF CALIFURNIA ss. COUNTY OF On ly , before rre the undersigned, a Notary—HbM an in for said noun y and State, personally appeared personal y known to me to Be t e same person whose name is sub- scribed to the within instrument as a subscribing witness there- to who being by .me duly sworn, deposed and said that he resides in the County of Los Angeles, State of Califorinia, that he was present and saw personally known to him to be the same person(33 describedin and whose name(s) is (are) subscriber'. to the within instrument as a (the) party(ies) thereto, sign and execute the same; and that he, the affiant, then and there sub- scribed his name to said instrument as a witness. WITNESS my hand and official seal. Rotary PuBlic in and for sai My Commission expires: County and State. STATE OF CALIFORNIA J S3. C OUN i Y OF On this day of, in the year lg , before me a Aiotary Public in aiia For sac County ana State, personally appeared , known to rye S to be the person whose name s suscrlBeH to the within instru- ment, and acknowledged to me that he executed the same. IN WITNESS WHEREOF,, I have hereunto set: my hand and affixed my official seal the day and year in thin certificate first above written. o ;aryPuBlic In and for said My Commission expires: County and State. R' 13 FRANW11 IL Able GAS. COMPANY 3851 LONG OFACH SOULEVAM • LONG BEACH 7, CALIFORNIA TELEPHONE, GArfiold 4-1412 aayr January 4, 1963 Hon. Mayor Robert M. Lambert Councilman Ernest Gisler Cnuncilman Lyndon A. Wells, Sr. Councilman Jake R. Stewart Councilman Thomas H. Welch Rs: Proposed Oil and Gas Lease covering the southerly 237*5 feet of Block 405, City of Huntington Beach, being a portion of the Civic Center, Gentlemen: The subject land, ovned by the City of Huntington Beach, falls 7 1 within an area which we are attempting to unitize for the purr pose of water flooding the Jones and Stray Sands, currently being produced In the downtown Town Lot Area. Enclosed herein you will find copies of our proposed Unit Agree- ment and our proposed -Subsurface Community Oil and Gas Lease. We ar© endeavoring to lease all unleased land within the unit area so that In the event we are successful In effecting unit operation and water flooding, all land within the unit area will participate in income fror production. We believe our lease, and the 25,%�f royalty that It provides, to be a good one, and we trust that you will find It beneficial to join In this plan and that the City will become a lessor under our lease. ..4 We will be happy to answer any questions you may have and in the evoint the City Attornsy has any questions we hope that he will feel free to contact us. Yours very tru FRANW 0 L ND -OMPANY W. S. Payn Jr. WSP/bm President Enc,, JE 4;1 i. Ue C1 1P 00 t FRANWI IL AND GAS COMPANY 3931 LONG BEACH DOL ILEVARD LONG SPACH 7. CALIFO;NIA TELEPHONto GAefiefd 4-1412 July 9, 1963 J ' City of Huntington Beach Hunt ington Beach, Cal ifornia A t t City Clerk Dear Lessor: V We have been diligently attempting to effect the unittzation program of the Jones and Stray Sand Zones of the Huntington Beach Field, which was the purpose of our making the Subsurface Community Oil and Gas Lease with you on your property. We have not as yet obtained control of the necessary wells and leases so an to effect this agreement, however we are still optimistic, and believe that we will finall-r accomplish this program. In accordance with provision (6) on page 2 of the lease, you will find our check in the amount of one dollar ($1.00) which will extend the term of the lease to i:ebruery 2, 1964. A Just as soon as we are able to advise you that this project will get under way you may rest assured that we will do so. Needless to say the henefits are so great for so many, that we feel the project is well worth all of the time, energy and monies we have exoended to date. Yours ery tru 4 • FR N 0 L ND S CO ANY A W. S ay Jr. P res iden ' WSP/bm Enc. 0 FRANWI . AND GAS COMPANY IA56 EAST HILL 3TP.EET • P. O. BOX 191 • LONG EEACH 1. CALIFORNIA TELEPHONEt GAAield 4•1412 February 10, 1964 Mayor R. M. Lambert City of Huntington Reach Huntington Beach, California Dear Mayor Lambert: Some months ago we obtained from you an Oil and Gas Lease cover3. = one or more lots in which you owned the mineral interest, all located in vicinity of the Townlot Area of the City of Huntington Beach, California. Tho purpose of this Oil and Gas Lease was to enable you to share in the benefits of a unitization program and waterflood of the Jones and Stray oil sands under- lying the area. A distinct additional benefit which would have accrued to you, solely, would have been that the plan wrntld have rapidly accelerated the cleanup of the downtown area of Huntington Beach. We have been working as diligently and as hard as we could since February, 1962, to attempt to get the operators and landowners to consent to this program in sufficient quantity to male it possible to carry it out. After the expenditure of approximately $60,000.00 plus one and one half years' work by the undersigned, ti;e sincerely regret to say that we did not obtain sufficient contents of the necessary parties to put the plan into effect. A relatively fcw but significant number of the small oil operators in the area refused to go along with the program, most of whoa offered little or no reason for their unwillingness to cooperate. We are indeed sorry that we were not succeosful, not only because of the business aspects of the venture, which admittedly are heartbreaking, but because we sincerely felt that our program wds in every way in the best interest of call concerned, in thn b:Qadest senile. Our lease with you expired February 2, 1964. We did not record the lease and therefore it is not necegaary to quitclaim the lease, as it will not cloud your title in any way. We sincerely appreciate your cooperation with us and are indeed sorry that we failed to make cur plan, materialise. JRAAI a ry ru, , old �" oral A�� ���/ 0 � D G CO 3 iY W. S . Payne r Jr. President /r WSP/bm