Min 06/19/1979 217
Wichita Falls , Texas
Memorial Auditorium Building
June 19, 1979
Item 1
The Board of Aldermen of the City of Wichita Falls, Texas , met in called
session on the above date in the Council Room of the Memorial Auditorium Building
at 8:30 o'clock A.M. , with the following members present.
Kenneth Hill Mayor
Marvin Traywick
John Hampton, Jr.
Carol Russell Aldermen
Curtis Smith
Jim Thomas
Raymond Adcock
Robert Haley Assistant City Manager
H. P. Hodge, Jr. City Attorney
Gerald Carlson Chief Accounting Officer
Wilma J. Thomas City Clerk
The invocation was given by Alderman Adcock.
Item 2
Moved by Alderman Russell that minutes of the meeting held June 12, 1979, be
approved.
Motion seconded by Alderman Adcock, and carried unanimously.
Moved by Alderman Thomas that minutes of the meeting held June 5, 1979, be
approved.
Motion seconded by Alderman Russell , and carried unanimously.
Item 3a
Depository bids were opened by Gerald Carlson, Chief Accounting Officer.
Interest rates bid on certificates of deposit are as follows.
a. Parker Square Bank - Option l on $100,000 or more - Constant rate of 8.15
percent per annum. Option 2 on $100,000 or more - a variable interest
rate from 61-2 percent to 92 percent. On certificates of deposit less than
$100,000, an interest rate of 8 percent per annum.
i
b. City National Bank - Option 1 on certificates of deposit under $100,000,
the greater of 7.27 percent per annum, or the 13-week U.S. Treasury Bill
rate established at the preceeding week's Treasury Bill offering. Option
2 under $100,000, 7.27 percent per annum. Option 1 on certificates of
deposit of $100,000 or more, the greater of 7.27 percent per annum, or
the 13-week U.S. Treasury Bill rate as established at the preceeding week's
Treasury Bill offering. Option 2 over $100,000, 8.01 percent compounded
daily.
c. First Wichita National Bank - Interest rate of 7.97 percent for both under
and over $100,000 certificates of deposit.
Mr. Carlson noted that our current rate is 7.38 percent above and below $100,000.
He left the Council Room to evaluate the bids, and to make copies of them.
b; Item 4a
A proposed ordinance was presented extending the state of emergency.
218
v Item 4a, cont'd.
'-ORDINANCE NO. 3502
ORDINANCE EXTENDING STATE OF DISASTER EMERGENCY FOR SEVEN DAYS.
Moved by Alderman Adcock that Ordinance No. 3502 be passed.
Motion seconded by Alderman Thomas, and carried by the following vote.
Ayes : Mayor Hill , Aldermen Traywick, Hampton, Russell , Smith, Thomas, and Adcock
Nays: None
v Item 5a
A proposed resolution was presented approving option agreement for park purchase
in Allendale Heights.
Alderman Traywick noted that he is a principal in this matter, and would decline
from any comments or discussion of it.
Alderman Thomas inquired if we need a park in this area? Bill Hursh, Director
of Parks and Recreation, stated that this area is west of town near Certainteed. They
have not required the park up to this time since the property out there has been slow
to develop. The area is remote, and if it does develop, there will be a need for it.
If it is not used as a park it would revert back to the previous owner. City Attorney
H. P. Hodge, explained the options involved in this proposed park land.
RESOLUTION NO. 2351
RESOLUTION APPROVING OPTION AGREEMENT WITH DON OLIVER III FOR PURCHASE
OF PARK LAND IN ALLENDALE HEIGHTS.
WHEREAS, Don Oliver III , the developer of Allendale Heights, filed with the
City a preliminary plat of such subdivision, which was formerly a part of Seymour
Heights Addition; and,
WHEREAS, the original developers of Seymour Heights were obligated to dedicate
for park land 2.3 acres of land under Resolution 395 which was applicable at the
time the final plat of Seymour Heights was approved; however, Mr. Oliver took the
position that the present subdivision ordinance requires the City to purchase
park land, and that he is not responsible to provide the 2.3 acres which the original
developers of Seymour Heights were obligated to provide; and,
WHEREAS, on April 23, 1979, the Wichita Falls Planning Board conditionally
approved the preliminary plat, subject to a determination of the controversy concerning
the 2.3 acres park requirement; and,
WHEREAS, the City staff and Mr. Oliver have reached a tentative agreement whereby,
if the City exercises an option to purchase 2 acres for park land, Mr. Oliver will
donate an additional 2.3 acres free of cost to the City.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF WICHITA
FALLS, TEXAS, THAT:
That certain option contract, a copy of which is attached hereto, between the
City of Wichita Falls and Don Oliver III , is hereby approved, and the City Manager
is authorized to execute the same for the City of Wichita Falls.
Moved by Alderman Thomas that Resolution No. 2351 be passed.
Motion seconded by Alderman Hampton, and carried by the following vote.
Ayes : Mayor Hill , Aldermen Hampton, Russell , Smith, Thomas, and Adcock
Nays: None
vItem 5b
Proposed resolutions were presented approving oil and gas leases at Lakes Wichita
and Kickapoo.
219
i
� v Item 5b, cont'd.
'RESOLUTION NO. 2352
RESOLUTION ACCEPTING BID AND APPROVING OIL AND GAS LEASE TO BURNS LEASING
CORP.
WHEREAS, heretofore the Board of Aldermen of the City of Wichita Falls determined
that it is advisable to lease for oil and gas the land described on the attached
lease, and published notice of its intention to lease such land in accordance with
Sections 71 .004 and 71 .005 of the Texas Natural Resources Code; and,
WHEREAS, at its meeting on April 17 , 1979, the date specified in such notice,
the Board of Aldermen received, opened and considered the bids submitted, at a public
hearing, in accordance with Section 71 .006 of such Code; and,
WHEREAS, the Board of Aldermen believes that the bid of Burns Leasing Corp.
represents the fair value of the lease on such property, and it is the only bid on
such property.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF WICHITA
FALLS, TEXAS, THAT:
Such bid of Burns Leasing Corp. is hereby accepted, that certain oil and gas
lease, a copy of which is attached hereto, between the City and Burns Leasing Corp.
is hereby approved, and the City Manager is authorized to execute the same for the
City of Wichita Falls .
Moved by Alderman Hampton that Resolution No. 2352 be passed.
Motion seconded by Alderman Thomas.
Alderman Hampton stated that eventually there should be four leases. What we
are looking at here now is three. He discussed Paragraph 11 on Page 4 of the lease,
stating that this is a protective lease for the city. He recommended adoption of
these leases, stating, however, that the Expando lease should be two instead of one.
There will be better and more rapid development if there are two leases. There
should be a 900.95 acre tract lease and a 408.5 acre tract lease, which would be
identical in form, but two separate leases. Alderman Traywick inquired what the
last sentence of Paragraph 2 means? Alderman Hampton explained that they could use
their own gas to pump oil out of the well .
The motion was carried by the following vote.
Ayes : Mayor Hill , Aldermen Traywick, Hampton, Russell , Smith, Thomas, and Adcock
Nays: None
City Attorney H. P. Hodge explained that we need to change the wording in
the last paragraph of the Resolution of Expando Oil Company to indicate that there
are two leases instead of one. This change was made.
,/RESOLUTION NO. 2353
RESOLUTION ACCEPTING BID AND APPROVING OIL AND GAS LEASES TO EXPANDO OIL
COMPANY.
WHEREAS, heretofore the Board of Aldermen of the City of Wichita Falls determined
that it is advisable to lease for oil and gas the lands described on the attached
leases , and published notice of its intention to lease such lands in accordance with
Sections 71 .004 and 71 .005 of the Texas Natural Resources Code; and,
WHEREAS, at its meeting on April 17, 1979, the date specified in such notice,
the Board of Aldermen received, opened and considered the bids submitted, at a
public hearing, in accordance with Section 71 .006 of such Code; and,
WHEREAS, the Board of Aldermen believes that the bid of Expando Oil Company
represents the fair value of the leases on such properties, and it is the only bid
on such properties.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF WICHITA
FALLS, TEXAS, THAT:
220
,Item 5b, cont-d.
Such bid of Expando Oil Company is hereby accepted, those two certain oil and
gas leases, copies of which are attached hereto, between the City and Expando Oil
Company are hereby approved, and the City Manager is authorized to execute the same
for the City of Wichita Falls.
Moved by Alderman Thomas that Resolution No. 2353 be passed with the recommended
changes.
Motion seconded by Alderman Adcock, and carried by the following vote.
Ayes: Mayor Hill , Aldermen Traywick, Hampton, Russell , Smith, Thomas, and Adcock
Nays : None
V.RESOLUTION NO. 2354
RESOLUTION ACCEPTING BID AND APPROVING OIL AND GAS LEASE TO TUTHILL &
BARBEE.
WHEREAS, heretofore the Board of Aldermen of the City of Wichita Falls determined
that it is advisable to lease for oil and gas the land described on. the attached
lease, and published notice of its intention to lease such land in accordance with
Sections 71 .004 and 71 .005 of the Texas Natural Resources Code; and,
WHEREAS, at its meeting on April 17, 1979, the date specified in such notice,
the Board of Aldermen received, opened and considered the bids submitted, at a
public hearing, in accordance with Section 71 .006 of such Code; and,
WHEREAS, the Board of Aldermen believes that the bid of Tuthill & Barbee
represents the fair value of the lease on such property, and it is the only bid on
such property.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF WICHITA
FALLS, TEXAS, THAT:
Such bid of Tuthill & Barbee is hereby accepted, that certain oil and gas lease,
a copy of which is attached hereto, between the City and Tuthill & Barbee is hereby
approved, and the City Manager is authorized to execute the same for the City of
Wichita Falls.
Moved by Alderman Smith that Resolution No. 2354 be passed.
Motion seconded by Alderman Russell , and carried by the following vote.
Ayes : Mayor Hill , Aldermen Traywick, Hampton, Russell , Smith, Thomas, and Adcock
Nays : None
Alderman Hampton noted that he has no interest in any of these companies.
v Item 5c
A proposed resolution was presented authorizing the City Manager to be the
City's agent for obtaining federal disaster assistance.
J RESOLUTION NO. 2355
DESIGNATION OF CITY OF WICHITA FALLS, TEXAS AUTHORIZED REPRESENTATIVE
AS AGENT IN OBTAINING FEDERAL DISASTER ASSISTANCE UNDER PUBLIC LAW 288,
93rd CONGRESS.
BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF WICHITA FALLS, TEXAS,
THAT Gerald G. Fox, City Manager, is hereby authorized to execute for and in behalf
of the City of Wichita Falls , a public entity established under the laws of the State
of Texas, project applications and to file them in the appropriate State office for
the purpose of obtaining certain Federal financial assistance under the Disaster
Relief Act (Public Law 288, 93rd Congress) or otherwise available from the President's
Disaster Relief Fund.
THAT the City of Wichita Falls, a public entity established under the laws of the
State of Texas, hereby authorizes its agent to provide to the State and to the Federal
221
Item 5c, cont'd.
Disaster Assistance Administration (FDAA) , Department of Housing and Urban Development
(HUD) for all matters pertaining to such Federal disaster assistance the assurances
and agreements attached hereto.
THAT Resolution 2330 is hereby repealed.
Moved by Alderman Russell that Resolution No. 2355 be passed.
Motion seconded by Alderman Adcock, and carried by the following vote.
Ayes : Mayor Hill , Aldermen Traywick, Hampton, Russell , Smith, Thomas, and Adcock
Nays : None
Assistant City Manager Robert Haley presented the first major application for
reimbursement under the FDAA. He stated that there will be at least one other
application. All these items have been approved locally, and screened by their
auditor. Reimbursement for damage to streets , trees , tombstones, and other things
will be considered in another application.
y'Item 6a
Discussion was held on alley paving receivables. City Attorney H. P. Hodge
pointed out that one of the problems with the alley paving charge is that even though
it is not a lien, it is the equivalent of a lien to the property owner. The property
owner feels that this is something he should have known about before he purchased
the property. Mr. Hodge stated that we should be able to file an affidavit in the
deed records when the Board of Aldermen orders an increase in refuse rates. Anyone
checking the records would find this. After the alley paving has been paid it
would be proper to file another affidavit at that time.
Alderman Traywick inquired what we are currently doing when someone protests
this charge? It was noted that it still comes out on the bill , but there is no
discontinuance of service. He wondered if it would be legally binding when they
acquired the property if they were aware of it. The City Attorney stated that it
would certainly weaken their position if we could tell them that it was called to
their attention.
Alderman Thomas stated that it would be unfair to waive these when some people
are paying, and some are not. It is not fair for one to pay, and one not to pay.
Alderman Russell stated that she would like to consider ten or twelve of the total
who are many times removed from the original owner. She would like to see us look
at Alternative Three on those owners who are protesting because they are not the
original owner. Alderman Adcock noted that if this were a part of the records
of the property at the time of closing, either the purchaser or seller would have
to agree to pay it.
Chief Accounting Officer Gerald Carlson stated that it is hard to collect on
a vacant lot when there is no refuse service on that lot. These bills were not on
the billing system until March of this year.
Ernest Lillard pointed out that all these people were billed when the paving
was completed. At that time they chose to ignore it, and since there was no refuse
service on vacant lots , there was no vehicle to collect these payments on the vacant
lots. All of them received at least one bill .
Alderman Thomas stated that we need an analysis of every item of the 38 on this
list.
City Attorney H. P. Hodge pointed out that even though we place an affidavit
in the deed records in the future, it will not take care of those in the past.
Alderman Hampton stated that rather than file affidavits , if you can charge and
collect for what is placed in front of the lot, he sees no reason why we cannot
charge for what is on the back of the lot.
Alderman Thomas pointed out that we need to know if the lot is vacant, if a
house was built later, and the original owner.
222
Item 6a, cont'd.
The Board of Aldermen directed the City Attorney to work out a proposal to place
a lien on the property for alley assessment paving. Ernest Lillard pointed out that
if this is done, they will have a public hearing at every meeting with four or five
ordinances involved in each of them. We have to justify each penny we place against
that assessment, and certify that it will enhance the value of the property in that
amount.
Alderman Russell stated that she would like to see these eleven accounts go
back to manual billing to the original property owners. Mayor Hill stated that the
ones who did not know about the assessment, and are paying, should be given the
same consideration as these eleven who are protesting and are not paying. He would
like to have this information. Alderman Thomas felt we should jump on those who
are not paying instead of giving money back to the people who are paying. Ernest
Lillard stated that the system is geared to those receiving refuse service. There
are only a few of those who have changed hands.
Moved by Alderman Hampton that Gerald Carlson be instructed to give them more
information on all accounts, and have the City Attorney bring to the July 3 meeting
an example of an affidavit which could be filed.
Motion seconded by Alderman Russell , and carried unanimously.
Item 7b
Bids were considered on office furnishing for the Activities Center. Alderman
Thomas stated that the bids seemed very high. He wondered why we did not have more
than two bids. Bill Schnautz, Purchasing Agent, stated that he had had the feedback
that if we are not interested in calling on these people on a public relations basis,
they are not interested in bidding. Various councilmen noted they had to go out after
the business. Alderman Hampton and Smith agreed that furniture suitable for the
Activities Center could be expected to cost more than normal office furniture.
Moved by Alderman Hampton that low bids be awarded as follows.
a. One wooden desk - Huff Furniture Galleries - $1 ,406.75
b. One secretarial "L" Desk - Huff Furniture Galleries - $1 ,034.50
c. One executive chair - Huff Furniture Galleries - $363.75
d. Two secretarial chairs - Continental Business Interiors - $109.00 each
e. Four visitors arm chairs - Huff Furniture Galleries - $277.88 each
f. Two wing chairs - Huff Furniture Galleries - $247.75 each
g. One lamp table - Huff Furniture Galleries - $174.75
Motion seconded by Alderman Russell .
Alderman Traywick stated that it appears this is an awful lot of money for these
items, and inquired how we arrived at the specifications? Alderman Russell stated
that one of the considerations was that these are the offices where spokesmen for
shows will meet and negotiate, but we looked at something which would be servicable
and also good. This was the basis on which the specifications were drawn. It was
noted that desks can easily cost $4,000.
The motion was carried unanimously.
Assistant City Manager Robert Haley reported on an incident of a 30-foot home-
built trailer which was stolen, reported, and found. The telephone number given was
incorrect, and the owner could not be reached for six days until they actually went
out to the house. The owner was charged $125.00 by the wrecker company who towed it
in, plus $3.00 per day for storage.
In Fort Worth they charge $30.00, plus one additional hour in the amount of
$20.00. In Abilene they charge $15.00 anywhere in the City, and $2.00 per day for
storage. A charge of $16.00 is made for one additional hour, for a maximum of $31 .00.
Mayor Hill noted that it is not worth $125.00 to pull a trailer from Notre Dame
to his shop.
City Attorney H. P. Hodge stated that on a rotation basis the owner does not have
223
the choice of who hauls the car in. He felt when the ordinance was passed there
should have been some provision placed in it to have some control over the maximum
price they can charge. The Council requested the City Attorney to prepare a
recommendation for a change in the ordinance at the July 3 council meeting. Mr.
Hodge explained that one option might be to contract for service with one individual ,
and have them bid on it.
Alderman Russell wondered if they had all gone up, or if this is something
which has occured since the tornado? Don Pilcher, from the Police Department, did
not know what they are charging.
City Attorney H. P. Hodge, Jr. , mentioned a telephone call from a U.S. Assistant
Attorney regarding the Putnam vs Gaines case on a mobile home in Colonial Park. If
these homes are held to be in violation of deed restrictions, then the federal
government would be involved, and would notify all mobile home occupants that the
mobile homes will have to be moved. This action will probably be taken in about
a week and a half. Assistant City Manager Robert Haley indicated that there are
680 trailers on private sites in the City.
Alderman Hampton stated that he felt this letter should be published in the
paper as an example of what the federal government is trying to do to the City of
Wichita Falls. It is an example of bribery and blackmail . He also blames the City
equally because the Council passed the ordinance not allowing them where deed
restrictions prevented them. He stated that the federal government placed these
mobile homes on these lots anyway. He questions the constitutionality of the
right to change deed restrictions by the Council .
Alderman Adcock did not agree with Alderman Hampton. We started out trying
to help the people. It seems a few people are picky and do not care about the
disaster victims. He assumed that people would not take advantage of those who were
in the disaster.
Mayor Hill stated that whatever action the Council can take should be taken to
help these people until it is proven wrong in court. Alderman Smith stated that he
felt this matter should be brought up again. People who did not lose anything are
not sympathetic to those who did.
Alderman Traywick stated that you can never count on the federal government to
assist you. It is the ultimate responsibility of the Council to assist these people.
He does not support the federal government in their action in this letter. Mayor
Hill suggested that this matter be placed on the agenda on June 26.
Assistant City Manager Robert Haley stated that the ordinance as passed would
also apply to Lake Arrowhead regarding placement of mobile homes outside mobile
home parks and subdivisions. This will be presented at the next meeting, also.
, Item 7a
Discussion was held on the depository contract bids. Gerald Carlson, Chief
Accounting Officer, stated that the decision will be a hard one. We have some good
bids. He feels, however, that a variable rate will be best for the City, in a time
of rising interest rates .
City National Bank bid a variable rate on certificates of deposit under $100,000.
They were the only bank who bid a variable rate in this category. On certificates
of deposit over $100,000, Parker Square Bank bid 112 of 1 percent above the 13-week
treasury bill rate, with a maximum of nine percent. First Wichita did not bid on
this. City National Bank bid a 13-week treasury bill rate, adjusted to the coupon
equivalent rate, with no maximum, and a 7.27 percent minimum.
Constant rates bid on certificates of deposit over $100,000 are as follows :
Parker Square Bank - 8.15 percent; First Wichita National Bank - 7.97 percent;
City National Bank - 8.01 percent. Constant rates bid on certificates of deposit
under $100,000 are as follows: Parker Square Bank - 8 percent; First Wichita
National Bank - 7.97 percent; City National Bank - 7.27 percent.
Paying agent's fees are as follows : Parker Square Bank - None; City National
Bank - $1 .25 per bond, plus 10 cents per coupon; First Wichita National Bank - $1 .25
for each $1000 bond, plus 10 cents per coupon and $1 .75 for each $5000 bond, plus
15 cents per coupon. No fees for other charges were indicated except by First
224
Item 7a, cont'd.
Wichita National Bank.
Chief Accounting Officer Gerald Carlson stated that he feels that the bid of
City National Bank would be best on coupon equivalency rate and no maximum on what
they will pay the City on certificates of deposit. The Council compared each item.
Lonny Morrison appeared for Parker Square Bank. He stated that the determination
of which bid is best first involves whether the City should participate in a variable
or constant interest rate. Parker Square Bank did not bid on variable rate amounts
less than $100,000. They bid for that money, eight percent, and that is the maximum
legal rate allowed by law on both variable and constant rates . With respect to
certificates of deposit under $100,000, the Parker Square Bank bid is 8 percent
as stated, and the City National Bank bid is 7.27 percent as stated. This is the
first time the City has advised its bidders that it reserves the right to deposit
sinking funds outside the depository. This is an economic disadvantage to the bidders
to give some determination to this in the bidding process. If the Council would
waive this, they would add 15 basis points to 1 .589 percent effective yield over $100,000.
The constant rate would be 8.437 percent if they do not reserve the right to invest
sinking fund deposits outside the depository. He also addressed whether the City
should enter into variable interest rates. The City is not in the money market. Three
different sources have not agreed on what interest rates will do in the future.
Mayor Hill agreed with Mr. Morrison that the City is not in the money market.
This is the City's money, and he feels we should go with the constant rate. Alderman
Thomas stated that he would be more inclined to go with the fixed rate rather than a
variable amount, in view of the fact that no one can tell how the money market is
going.
RESOLUTION NO. 2356
RESOLUTION ACCEPTING PROPOSAL OF CITY NATIONAL BANK TO SERVE AS DEPOSITORY
FOR THE CITY OF WICHITA FALLS.
WHEREAS, the City of Wichita Falls has advertised for bids to serve as
depository for the City; and,
WHEREAS, the bid of City National Bank is found to be the best bid.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF WICHITA
FALLS, TEXAS, THAT:
Said proposal of City National Bank is hereby accepted, and the City Manager is
authorized to execute a contract embodying this proposal .
Moved by Alderman Hampton that Resolution No. 2356 be passed, awarding the bid
to City National Bank on the variable rate recommended by Mr. Carlson.
Motion seconded by Alderman Traywick, and carried by the following vote.
Ayes : Aldermen Traywick, Hampton, Russell , Smith, and Adcock
Nays : Mayor Hill and Alderman Thomas
J. C. Boyd stated that Ken Hanes had asked him to announce that there will be a
modular home display at 2800 Boren Street at 8:00 o'clock A.M. tomorrow.
The Board of Aldermen adjourned at 11 :50 A.M.
PASSED AND APPROVED this ay of_ � 1979.
MAYOR
ATTEST:
CITY CLERK
CONTRACT CHANGE ORDER ORDER NO. 1
DATE May 29, 1979
CONTRACT FOR: Wichita Falls Municipal Airport, Phase IV
ADAP Project 6-48-0227-05
Off: City of Wichita Falls
TO: Timmins-Anderson Co
You are hereby requested to comply with the following changes from the contract
Plans and specifications:
D&iCRIPTION OF CBANGEs : DECREASE I14CREASE
(Supplemental Plans & Specifications Attached)•in Contract Price: in Contract Price
1) Removal of curb adjacent to proposed $ $
aircraft ramp extension 200.00
2) Installation of wheel chair ramps
in front of terminal building 1,730.00
3) Relocation of underground electrical
service and.temporary electrical hookup
in front of terminal building 3,412.50
4) Taxiway striping - Contract Item No. 27
Unit price reduced by $1.25 per square
foot 35750.00
TOTALS $ 37750.00 $ 55342.50
NET CHANGE IN CONTRACT PRICE $ $ 1,592 50
X STIFICATION: Changes necessary to aid drainage, provide access to handicapped, allow
minimal interruptiQn of electrical service, and to lower cost of striping as previously
The amount o the Contract will be d)( Increased) by the Sum of: One Thousand
Five Huncired Ninety Two and 50,[100------------------------Doll-ir-,( 1,592.50 )
The Contract Total including this and previous Change Orders will be: Four Hundred
Ninety Six Thousand Twenty Two and 251100-----------------Dollars($ 496,022.25 )
The Contract Period provided for completion will be
(Unchanged) Days-
Thl cccw::ent will become a supplement to the contract and all provisions will
ap?ly 11=eto.
I'nr, ent0d-. (Own, r\•
/
Rorr ecr�en�ed�(ENGI1��lEER) `� --- �., Date.
Date
Accepted (C:;. tractor) ate
5/31/79
'TATP OF TEXAS )
c'.nTTT,TTY OF WICHITA )
This agreement made and entered into this the �° day of
1979, by and between the City of Wichita Falls, Texas,
hor.einafter called "City", and Don Oliver III, hereinafter called
"Subdivider",
WITNESSETH:
WHEREAS, Resolution 395 was in effect at the time the first
sections of Seymour Heights Addition were platted, which resolution
required that the Subdivider dedicate certain park lands to the City
of Wichita Falls ; under this resolution, the Subdividers of Seymour
Heights Addition were obligated to dedicate 2.3 acres of land for a
park; and,
WHEREAS, Ordinance 2118, the comprehensive subdivision ordinance
of Lhe City of Wichita Falls, now requires that all subdividers set
aside land for park purposes when the master park plan of the City
shows a park is required in the area to be subdivided; the ordinance
provides that the City shall be granted an option to purchase the land
to set aside for park purposes; and,
WHEREAS, Subdivider has filed with the City a preliminary plat
of Allendale Heights out of Block 2, League 2, Denton County School
Land, A--57 and S . R. Ludolphus Subdivision, Block 12 (formerly Seymour
Heights) dated March, 1979, and the parties desire to formalize the
option which City has by virtue of the above ordinance for park land
in the land covered by such preliminary plat.
NOW, THEREFORE, for and in consideration of the premises and mutual
covenants herein contained, and in compliance with such ordinance, the
parties hereto do hereby agree as follows :
Subdivider does hereby grant to City an option to purchase for park
purposes two acres, and agrees to convey to City free of charge 2.3 acres
of land for park purposes, the total of 4.3 acres being shown on such
preliminary plat as "Reserved for Park" .
City miist exercise its option to purchase such land within thirty
days after April 23, 1980, or thirty days after residences have been
built on one-half of the lots on such preliminary plat, whichever date
is later. Subdivider shall give written notice to City'.s Director of
Planning stating the date on which residences have been completed on .
one-half of such lots .
If City fails to exercise this option, the option shall terminate,
and Subdivider shall not convey such 2.3 acres of land to City. Sub-
divider may then proceed to develop the 4.3 acres of land in any way
authorized by the subdivision ordinance, with no further requirement
concerning park lands in the area covered by such preliminary plat insofar
as Ordinance No. 2118 and Resolution No. 395 are concerned.
To exercise this option, City shall give Subdivider notice in writing
within such thirty day period, delivered by certified mail or by hand,
stating the fact that it does exercise its option. If such notice is
sent by certified mail, it shall be sufficient if the notice is actually
deposited in the United States Mail within such thirty day period. If
City does exercise its option, the purchase price to be paid by City to
Subdivider for such two acres of land shall be the sum of
Dollars cash. In addition, City shall pay its pro rata part of all devel-
opment costs attributable to all such park land as may be required by
City, including abutting streets and utilities necessary to serve such
park land.
If City does exercise its option, it shall budget the purchase price
for such two acres in its budget for its next fiscal year beginning not
less than thirty days after it exercises such option. Notwithstanding
anything herein to the contrary, the purchase price shall not be payable
until thirty days after the beginning of such fiscal year.
When such budget has been approved, Subdivider shall furnish to
City either a complete abstract of title to said property, or shall
furnish a policy of title insurance. If abstract of title is furnished,
City shall within ten days from receipt of the abstract, either accept
the title or return the abstract to Subdivider with written objections
to the title. If title objections are made, Subdivider shall have a
reasonable time to cure such objections .
When the title objections have been cured, or when the title
company approves title, Subdivider shall deliver a general warranty
deed conveying to City good and marketable title to the above described
4.3 acres of land, free and clear of all encumbrances, and City shall
pay to Subdivider the purchase price for two acres.
IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed as of the day and year first set out above.
CITY OF WICHITA FALLS, TEXAS
BY•
Gerald G. Fox
City Manager
Don Oliver III
STATE OF TEXAS )
COUNTY OF WICHITA )
BEFORE ME, the undersigned, a Notary Public in and for Wichita
County, Texas, on this day personally appeared Gerald G. Fox, City
Manager of the City of Wichita Falls, Texas, a municipal corporation,
known to me to be the person and officer whose name is subscribed to
the foregoing instrument and acknowledged to me that the same was the
act of the said City of Wichita Falls, Texas, a municipal corporation,
and that he executed the same as the act of said City of Wichita Falls,
for the purposes and consideration therein expressed, and in the capacity
therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the 044 day of ,
1979.
M. Commission Expires : maztha L-tClftl*l
Notary Public, Wichita County, Texas
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OIL AND GAS LEASE
STATF OF TEXAS X
COUNTY OF ARCHER X KNOW ALL MEN BY THESE PRESENTS THAT:
X
WHEREAS, the City of Wichita Falls, Texas ("Lessor") , is the owner
of the tracts of land in said County and State described in Exhibit "A"
attached hereto, incorporated herein by reference and made a part hereof
for all purposes (the "Property") ;
WHEREAS, Lessor has determined that it is advisable and in the best in-
terest of the City of Wichita Falls, Texas to lease the Property for pur-
pose of producing the oil and gas thereunder in a manner which will not
interfere with the public use of the Property;
WHEREAS, Lessor has given notice of its intention to lease the
Property in accordance with Sections 71. 004 and 71. 005 of the State of
Texas Natural Resources Code (the "Code") and has received and considered
bids, at a public hearing, in accordance with Section 71. 006 of the Code;
WHEREAS, Burns Leasing Corp.
("Lessee") was the highest and best bidder who submitted a bid for the lease
of the Property;
WHEREAS, Lessor desires to lease the Property to Lessee for the purpose
of producing the oil and gas thereunder, and Lessee desires to accept such
lease from Lessor, in accordance with the terms, provisions and conditions
hc_reinafter set forth;
NOW, THEREFORE, for and in consideration of Twenty-Five and 50/100 Dollars
x.or net mineral acre and other good and valuable consideration, the receipt
an sufficiency of which is hereby acknowledged, Lessor has granted, de-
misod, leased and let, and by these presents does grant, demise, lease
and let, unto Lessee all of the Property described in the attached Exhibit
"A" for the purpose of investigating, exploring, prospecting and drilling
for and producing the oil and gas thereunder and to save, take care of,
treat, transport and own said oil and gas.
1. Subject to the other provisions herein contained, this lease
:hall remain in force for a term of five years from the date hereof
(called the "Primary Term") and as long thereafter as oil and gas, or
ei.-rher of them, is produced from said Property or land with which said
property is pooled herewith.
2. The royalties to be paid by ,Lessee are (a) on oil 1/8. of that pro-
dneed and saved from said Property, the same to be delivered at the wells
or to the credit of Lessor into the pipeline to which the wells may be
connected; Lessee may from time to time purchase any royalty oil in its
possession, paying the market price therefor prevailing for the field where
produced on the date of purchase; (b) to pay Lessor on gas and casinghead
gas produced from said land (1) when sold by Lessee 1/8 of the amount
realized by Lessee computed at the mouth of the well, or (2) when used by
Lessee off said land or in the manufacture of gasoline or other products,
1/8 of the amount realized from the sale of gasoline or other products
Extracted therefrom and 1/8 of the amount realized from the sale of res-
idne gas after deducting the amount used -for plant fuel and/or compression;
while there is a gas well on this Property or on acreage pooled therewith
but gas is not being sold or used, Lessee may pay as royalty, on or before
ninety (90) days after the date on which (1) said well is shut in, or (2)
the Property covered hereby or any portion thereof is included in a pooled
unit on which a well is located, or (3) this lease ceases to be otherwise
maintained as provided herein whichever is the later date, and thereafter
at annual intervals on or before the anniversary of the date the first
payment is made, a sum of Two Hundred and No/100 ($200. 00) per well, and
if such payment is made or tendered, this lease shall not terminate and
it will be considered that gas is being produced from this lease in pay-
ing quantities. Lessee shall have free use of oil and gas from said
Property for all operations hereunder and the royalty on oil and gas shall
he computed after deducting any so used.
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3. Losspe, at Its option, is hereby given the right and power to
pool or combine the Property or any portion thereof as to oil and gas, or
either of them, wi-th other land, lea,e or leases in the immediate vicinity
thereof to the extent hereinafter stipulated in order to produce the oil
and eras underneath the Property, provided however, that in a unit pooled
for oil, or gas, said oil or gas unit shall be composed of no less than fif-
ty percent (50%) acreage from the Property, or the entire Property, which-
ever is the lesser amount of acreage. Units pooled for oil hereunder shall
not substantially exceed eighty (80) acres each in area, and units pooled
for gas hereunder shall not substantially exceed in area three hundred
twenty (320) acres each, plus a tolerance of ten per cent (10%) thereof,
provided that any such unit may not contain more than the minimum number
of acres on which an oil and gas well must be located to comply with rules
or orders of the Railroad Commission of Texas as applied to the Property.
Lessee under the provisions hereof may pool or combine the Property or
any portion thereof as above provided as to oil in any one or more strata
and as to gas in any one or more strata. The units formed by pooling as
to any stratum or strata need not conform in size or area with the unit or
units into which the Property is pooled or combined as to any other stratum
or strata and oil units need not conform as to area with gas units. The
pooling in one or more instances shall not exhaust the rights of the Lessee
hereunder to pool the Property or portions thereof into any other units.
Lessee shall file for record in the appropriate records of the county or
counties in which the Property is located, an instrument describing and
designating the pooled acreage as a pooled unit; and upon such recordation
the unit shall be effective as to all parties hereto, their successorsand
assigns; irrespective of whether or not the unit is likewise effective as
to all other owners of surface, mineral, royalty or other rights in land
included in such unit. Operations for drilling on or production of oil
or gas from any part of the pooled unit which includes all or any portion
of the Property, shall be considered as operations for drilling or pro-
duction of oil or gas from the Property and the entire acreage constitut-
ing such unit or units, as to oil and gas, or either of them, as herein
provided, shall be treated for all purposes, except the payment of royal-
ties upon production from the pooled unit, as if the same were included
in this Lease. For the purpose of computing the royalties to which own-
ers of royalties and payments out of production shall be entitled on
production of oil and gas, or either of them, from the pooled unit, there
shall be allocated to the Property and included in said unit a pro rata
portion of the oil and gas, or either of them, produced from the pooled
unit. Such allocation shall be on an acreage basis (that is, there shall
be allocated to the acreage covered by this Lease and included in the
pooled unit that pro rata portion of the oil and gas, or either of them,
produced from the pooled unit which is the number of surface acres cover-
ed by this Lease and included in the pooled unit bears to the total number
of surface acres included in the pooled unit) . Royalties hereunder shall .
be computed on the portion of such production, whether it be oil and gas,
or either of them, so allocated to the Property and included in the unit
just as though such production were from the Property. The production
from an oil well will be considered production from the lease or oil pool-
ed unit from which it is producing and not as production from a gas pooled
unit; and production from a gas well will be considered as production
from the lease or gas pooled unit from which it is producing and not from
an oil pooled unit.
4. If operations for drilling are not commenced on said Property or
acreage pooled therewith as above provided on or before one (1) year from
this date, the Lease shall then terminate as to both parties, unless on
or before such anniversary date Lessee shall pay or tender (or shall make
a bona fide attempt to pay or tender, as hereinafter stated) to Lessor or
to the credit of Lessor in Parker Square State
Bank at Wichita Falls, Texas, (which bank and its successors are Lessor' s
agent and shall continue as the depository for all rentals payable here-
under regardless of changes in ownership of said Property or the rentals)
the sum of ONE DOLLAR ($1. 00) per acre for the number of acres then sub-
ject to this Lease (hereinafter called "Rental") , which shall cover the
privilege of deferring commencement of drilling operations for period of
twelve (12) months. In like manner and upon like payments or tenders
annually, the commencement of drilling operations may be further deferr-
ed for successive period of twelve (12) months each during the primary
term. The payment or tender of rental under this paragraph and of
royalty under Paragraph 2 on any gas well from which gas is not being
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sold or used may be made by check or draft of Lessee mailed or delivered
to the parties er-iiled thereto or to said bank on or before the date of
p;:ivm-�nt. Lf such brink (or any successor bank) should fail, liquidate or
he succeeded by another bank, or for any reason fail or refuse to accept
rental, Lessee shall not be held in default for failure to make such pay-
ment or tender of rental until thirty (30) days after Lessor shall deliver
to Lessee a proper recordable instrument naming another bank as agent to
receive such payments or tenders. If Lessee shall, on or before any anni-
versary date, make a bona fide attempt to pay or deposit rental to a Lessor
entitled thereto according to Lessee' s records or to a Lessor, who, prior
to such attempted payment or deposit, has given Lessee notice, in accord-
ance with subsequent provisions of this Lease, of the right to receive
rental, and if such payment or deposit shall be ineffective or erroneous
in any regard, Lessee shall be unconditionally obligated to pay to such
Lessor the rental propgriy payable for the rental period involved, and
this Lease shall not terminate but shall be maintained in the same manner
as if such erroneous or ineffective rental payment or deposit has been pro-
perly made, provided that the erroneous or ineffective rental payment or
deposit be corrected within 30 days after receipt by Lessee of written
notice from such Lessor of such error accompanied by such instruments as
are necessary to enable Lessee to make proper payment. The down cash pay-
ment is consideration for this Lease according to its terms and shall not
be allocated as a mere rental for a period. Lessee may at any time or
times execute and deliver to Lessor or to the depository above named or
place of record a release or releases of this Lease as to all or part of the
Property, or of any mineral or horizon under all or any portion thereof,
and thereby be relieved of all obligations as to the released Property or
interest. If this Lease is released as to all minerals and horizons under
a portion of the Property covered by this Lease, the rentals and other
payments computed in accordance therewith shall thereupon be reduced in
the proportion that the number of surface acres within such released por-
tion bears to the total number of surface acres which was covered by this
Lease immediately prior to such release.
5. If prior to discovery and production of oil or gas on said
Property or on acreage pooled therewith, Lessee shall drill a dry hole or
hncs thereon, or, if after discovery and production of oil or gas, pro-
duct .on thereof should cease from any cause, this Lease shall not terminate
if Lessee commences operations for drilling or re-working operations six-
ty (60) days thereafter, or, if it be within the Primary Term, commences
or resumes the payment or tender of rentals or commences operations for
drillings or re-working on or before the rental paying date next ensuing
after the expiration of sixty (60) days from the date of completion of dry
hole or cessation of production. If at any time subsequent to sixty (60)
days prior to the beginning of the last year of the Primary Term and prior
to the discovery of oil or gas on said property or on acreage pooled there-
with, Lessee should drill a dry hole thereon no rental payment or operations
are necessary in order to keep the Lease in force during the remainder of
the Primary Term. If at the expiration of the Primary Term oil or gas is
not being produced on said Property or on acreage pooled therewith, but
Lessee is then engaged in drilling or re-working operations thereon or
shall have completed a dry hole thereon within sixty (60) days prior to the
end of the Primary Term the Lease shall remain in force so long as opera-
tions on said well or drilling or re-working of any additional well are
prosecuted with no cessation of more than sixty (60) consecutive days and
if they result in production of oil or gas so long thereafter as oil or
gas is produced from said Property or acreage pooled therewith. Any
pooled unit designated by Lessee in accordance with the terms hereof may
be dissolved by Lessee by an instrument filed for record in the appro-
priate records of the county or counties in which the leased premises
are situated at any time after the completion of a dry hole or the cessa-
tion of production on said unit. In the event a well or wells producing
oil or gas in paying quantities shall be brought in on adjacent land
and within 330 feet of and draining the lease premises or acreage pool-
ed therewith Lessee agrees to drill such offset wells as a reasonable
and prudent operator would drill under the same or similar circum-
stances.
6. Lessee shall have the right at any time during or after the
expiration of this Lease to remove all property and fixtures placed by
Lessee on said Property, incimding the right to draw and remove all cas-
ing. When required by Lessor, Lessee shall bury all pipelines below
-3-
4
5/79
,rcl i nary
7 . .` in ri-ghts of either party herelind(,r may be assigned in whole or
in part, and the provisions hereof shall extend to their heirs, successors
and assigns; . hut no change or division in ownership of the land, rentals
or royalties , however accomplished, shall operate to enlarge the obliga-
tions or diminish the rights of Lessee; and no change or division in such
ownership shall be binding on Lessee until thirty (30) days after Lessee
shall have been furnished by registered U. S. mail at Lessee' s principal
place of business with a certified copy of recorded instrument or instru-
ments evidencing same. In the event of assignment hereof in whole or in
part, liability for breach of any obligation hereunder shall rest exclu-
sively upon the owner of this Lease or of a portion thereof who commits
such breach. In event of assignment of this Lease as to a segregated por-
tion of said Property, the rentals payable hereunder shall be apportion-
able as between the several leasehold owners ratably according to the sur-
face area of each, and default in rental payment by one shall not affect
the rights of other leasehold owners hereunder.
8. The breach by Lessee of any obligation arising hereunder shall not
work a forfeiture or termination of this Lease nor cause a termination or
reversion of the estate created hereby nor be grounds for cancellation
hereof in whole or in part. In the event Lessor considers that operations
are not at any time being conducted in compliance with this Lease, Lessor
shall notify Lessee in writing of the facts relied upon as constituting a
breach hereof, and Lessee, if in default, shall have sixty (60) days after
receipt of such notice in which to commence the compliance with the obli-
gations imposed by virtue of this instrument.
9. It is agreed that if this Lease covers a less interest in oil or
gas in all, or any part, of said Property than the entire and undivided fee
simple estate (whether Lessor' s interest is herein specified or not) or no
interest therein, then the royalties, delay rentals and other monies accru-
ing from any part as to which this Lease covers less than such full interest
shall be paid only in the proportion to which the interest therein, if any,
covered by this Lease bears to the whole and undivided fee simple estate
therein. All royalty interest covered by this Lease (whether or not owned
by Lessor) shall be paid out of the royalty herein provided. Failure of
Lessee to reduce rental paid hereunder shall not impair the right of Lessee
to reduce royalty.
10. Should Lessee be prevented from complying with any express or implied
covenant of this Lease, from conducting drilling or re-working operations
thereon or from producing oil or gas therefrom by reason of scarcity of or
inability to obtain or to use equipment or material, or by operation of
force majeure, any Federal or state law or any order, rule or regulation of
governmental authority, then while so prevented, Lessee' s obligation to
comply with such covenant shall be suspended, and Lessee shall not be liable
in damages for failure to comply therewith; and this Lease shall be extend-
ed while and so long as Lessee is prevented by any such cause from conduct-
ing drilling or re-working operations on or from producing oil or gas from
the leased premises or land pooled with the leased premises; and the time
while Lessee is so prevented shall not be counted against Lessee, anything
in this Lease to the contrary notwithstanding.
11. Notwithstanding the other provisions of this Lease, it is distinct-
ly understood that Lessee shall not conduct any drilling operations or make
any installations or lay any pipeline on the leased Property until the lo-
cation of the well, installation of other equipment and any pipeline is
approved by the City of Wichita Falls and the drilling location, drilling
operations, installation and pipeline must meet the specifications design-
ed by the City of Wichita Falls to protect the water in the lake located
on the leased Property. Provided, however, Lessee does have the right to
directionally drill, produce and conduct operations and exercise all other
rights herein granted on the subsurface of the leased Property where the
surface location of such well is off of the leased Property and such opera-
tions shall be conducted in a manner to protect the water in the lake on
the leased Property. It is understood that the above provision, shall in
no way impair the pooling provisions herein.
12. Nothwithstanding the other provisions of this Lease, if, at the
end of the Primary Term, this Lease is being maintained by production of
oil or gas on the leased Property or on land pooled with the leased Property
-4-
5/79
n main.'-.airled a:- otherwise I-)erein t•rovided, then at such time
1.1�eY'Pf:,:r�r as Lessee fails to commence an additional well each six (6)
mn41-'bs tter the and of the Primary Term either on the leased Property or
on property pooled with the leased Property, then at such time all of the
leased Property shall revert to Lessor, save and except such part of the
leased Property as is included within producing pooled units or as to pro-
dneing wells on the leased Property as to such acreage as the Railroad
Commission of Texas allocates for the production of oil or gas for a pro-
ration unit on the leased Property, which, in no event, shall exceed
eighty (80) acres for an oil well and three hundred and twenty (320)
acres for a gas well.
13. There is no warranty of title, either expressed or implied.
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be
executed this 1st day of June ,
CITY OF WICHITA FALLS, TEXAS
BY:
City Manager
ATTEST:
City Clerk
Burns Leasing Corp.
By:
H. R. Knots, President
-5-
Exhibit "A" to Oil and Gas Lease
from City of Wichita Falls to
Burns Leasing Corp.
That certain tract of land situated in Archer County, Texas,
described as follows:
BEGINNING at a point located in the East fence of the City
of Wichita Falls Lake Kickapoo property where the fence
crosses the South line of SA&MG Survey No. 177, Abst. No. 447.
Said point being approximately 1250 feet West of the Southeast
corner of said SA&MG Survey No. 177;
THENCE North 160 19' East along said East fence line of the
City of Wichita Falls Lake Kickapoo property, a distance of
approximately 1080 feet, a corner in said fence line;
THENCE North 750 5' West continuing along said fence line of
the City of Wichita Falls Lake Kickapoo property 1640 feet to
a point, a corner in said fence line;
THENCE South 1450 feet to a point in the South line of SA&MG
Survey No. 177;
THENCE East along the South line of the survey 1296 feet to
the point of beginning; Said tract being 45 acres, more or
less.
1
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OIL AND GAS LEASE
STATE OF TEXAS X
COUNTIES OF ARCHER X KNOW ALL MEN BY THESE PRESENTS THAT:
AND WICHITA
X
WHEREAS, the City of Wichita Falls, Texas ("Lessor" ) , is the owner
of the tracts of land in said County and State described in Exhibit "A"
attached hereto, incorporated herein by reference and made a part hereof
for all purposes (the "Property") ;
WHEREAS , Lessor has determined that it is advisable and in the best in-
terest of the City of Wichita Falls, Texas to lease the Property for pur-
pose of producing the oil and gas thereunder in a manner which will not
interfere with the public use of the Property;
WHEREAS, Lessor has given notice of its intention to lease the
Property in accordance with Sections 71. 004 and 71. 005 of the State of
Texas Natural Resources Code (the "Code") and has received and considered
bids, at a public hearing, in accordance with Section 71. 006 of the Code;
WHEREAS , Expando Oil Company, a partnership
( "Lessee" ) was the highest and best bidder who submitted a bid for the lease
of the Property;
WHEREAS, Lessor desires to lease the Property to Lessee for the purpose
of producing the oil and gas thereunder, and Lessee desires to accept such
lease from Lessor, in accordance with the terms, provisions and conditions
hereinafter set forth;
NOW, THEREFORE, for and in consideration of Seven and 50/100 Dollars ($7 . 50)
per net mineral acre and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Lessor has granted, de-
mised, leased and let, and by these presents does grant, demise, lease
and let, unto Lessee all of the Property described in the attached Exhibit
"A" for the purpose of investigating, exploring, prospecting and drilling
for and producing the oil and gas thereunder and to save, take care of,
treat, transport and own said oil and gas.
1. Subject to the other provisions herein contained, this lease
shall remain in force for a term of l/8 years from the date hereof
(called the "Primary Term" ) and as long thereafter as oil and gas, or
either of them, is produced from said Property or land with which said
property is pooled herewith.
2. The royalties to be paid by Lessee are (a) on oil 1/8 of that pro-
duced and saved from said Property, the same to be delivered at the wells
or to the credit of Lessor into the pipeline to which the wells may be
connected; Lessee may from time to time purchase any royalty oil in its
possession, paying the market price therefor prevailing for the field where
produced on the date of purchase; (b) to pay Lessor on gas and casinghead
gas produced from said land (1) when sold by Lessee 1/8 o_f the amount
realized by Lessee computed at the mouth of the well, or (2) when used by
Lessee off said land or in the manufacture of gasoline or other products,
1/8 of the amount realized from the sale of gasoline or other products
extracted therefrom and 1 8 of the amount realized from the sale of res-
idue gas after deducting the amount used for plant fuel and/or compression;
while there is a gas well on this Property or on acreage pooled therewith
but gas is not being sold or used, Lessee may pay as royalty, on or before
ninety (90) days after the date on which (1) said well is shut in, or (2)
the Property covered hereby or any portion thereof is included in a pooled
unit on which a well is located, or (3) this lease ceases to be otherwise
maintained as provided herein whichever is the later date, and thereafter
at annual intervals on or before the anniversary of the date the first
payment is made, a sum of Two Hundred and No/100 ($200. 00) per well, and
if such payment is made or tendered, this lease shall not terminate and
it will be considered that gas is being produced from this lease in pay-
ing quantities. Lessee shall have free use of oil and gas from said
Property for all operations hereunder and the royalty on oil and gas shall
be computed after deducting any so used.
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3 . Lessee, at its option, is hereby given the right and power to
pool or combine the Property or any portion thereof as to oil and gas, or
either of them, with other land, lease or leases in the immediate vicinity
thereof to the extent hereinafter stipulated in order to produce the oil
and gas underneath the Property, provided however, that in a unit pooled
for oil or gas, said oil or gas unit shall be composed of no less than fif-
ty percent (50%) acreage from the Property, or the entire Property, which-
ever is the lesser amount of acreage. Units pooled for oil hereunder shall
not substantially exceed eighty (80) acres each in area, and units pooled
for gas hereunder shall not substantially exceed in area three hundred
twenty (320) acres each, plus a tolerance of ten per cent (10%) thereof,
Provided that any such unit may not contain more than the minimum number
of acres on which an oil and gas well must be located to comply with rules
or orders of the Railroad Commission of Texas as applied to the Property.
Lessee under the provisions hereof may pool or combine the Property or
any portion thereof as above provided as to oil in any one or more strata
and as to gas in any one or more strata. The units formed by pooling as
to any stratum or strata need not conform in size or area with the unit or
units into which the Property is pooled or combined as to any other stratum
or strata and oil units need not conform as to area with gas units. The
pooling in one or more instances shall not exhaust the rights of the Lessee
hereunder to pool the Property or portions thereof into any other units.
Lessee shall file for record in the appropriate records of the county or
counties in which the Property is located, an instrument describing and
designating the pooled acreage as a pooled unit; and upon such recordation
the unit shall be effective as to all parties hereto, their successorsand
assigns; irrespective of whether or not the unit is likewise effective as
to all other owners of surface, mineral, royalty or other rights in land
included in such unit. Operations for drilling on or production of oil
or gas from any part of the pooled unit which includes all or any portion
of the Property, shall be considered as operations for drilling or pro-
duction of oil or gas from the Property and the entire acreage constitut-
ing such unit or units, as to oil and gas , or either of them, as herein
provided, shall be treated for all purposes , except the payment of royal-
ties upon production from the pooled unit, as if the same were included
in this Lease. For the purpose of computing the royalties to which own-
ers of royalties and, payments out of production shall be entitled on
production of oil and gas, or either of them, from the pooled unit, there
shall be allocated to the Property and included in said unit a pro rata
portion of the oil and gas, or either of them, produced from the pooled
unit. Such allocation shall be on an acreage basis (that is, there shall
be allocated to the acreage covered by this Lease and included in the
pooled unit that pro rata portion of the oil and gas , or either of them,
produced from the pooled unit which is the number of surface acres cover-
ed by this Lease and included in the pooled unit bears to the total number
of surface acres included in the pooled unit) . Royalties hereunder shall
be computed on the portion of such production, whether it be oil and gas,
or either of them, so allocated to the Property and included in the unit
just as though such production were from the Property. The production
from an oil well will be considered production from the lease or oil pool-
ed unit from which it is producing and not as production from a gas pooled
unit; and production from a gas well will be considered as production
from the lease or gas pooled unit from which it is producing and not from
an oil pooled unit.
4 . If operations for drilling are not commenced on said Property or
acreage pooled therewith as above provided on or before one (1) year from
this date, the Lease shall then terminate as to both parties , unless on
or before such anniversary date Lessee shall pay or tender (or shall make
a bona fide attempt to pay or tender, as hereinafter stated) to Lessor or
to the credit of Lessor in Parker Square State
Bank at Wichita Falls , Texas, (which bank and its successors are Lessor' s
agent and shall continue as the depository for all rentals payable here-
under regardless of changes in ownership of said Property or the rentals)
the sum of ONE DOLLAR ($1. 00) per acre for the number of acres then sub-
ject to this Lease (hereinafter called "Rental") , which shall cover the
privilege of deferring commencement of drilling operations for period of
twelve (12) months. In like manner and upon like payments or tenders
annually, the commencement of drilling operations may be further deferr-
ed for successive period of twelve (12) months each during the primary
term. The payment or tender of rental under this paragraph and of
royalty under Paragraph 2 on any gas well from which gas is not being
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5/79
sold or used may be made by check or draft of Lessee mailed or delivered
to the parties entitled thereto or to said bank on or before the date of
payment . If such bank (or any successor bank) should fail, liquidate or
be succeeded by another bank, or for any reason fail or refuse to accept
rental, Lessee shall not be held in default for failure to make such pay-
ment or tender of rental until thirty (30) days after Lessor shall deliver
to Lessee a proper recordable instrument naming another bank as agent to
receive such payments or tenders. If Lessee shall, on or before any anni-
versary date, make a bona fide attempt to pay or deposit rental to a Lessor
entitled thereto according to Lessee ' s records or to a Lessor, who, prior
to such attempted payment or deposit, has given Lessee notice, in accord-
ance with subsequent provisions of this Lease, of the right to receive
rental , and if such payment or deposit shall be ineffective or erroneous
in any regard, Lessee shall be unconditionally obligated to pay to such
Lessor the rental propEkrly payable for the rental period involved, and
this Lease shall not terminate but shall be maintained in the same manner
as if such erroneous or ineffective rental payment or deposit has been pro-
perly made, provided that the erroneous or ineffective rental payment or
deposit be corrected within 30 days after receipt by Lessee of written
notice from such Lessor of such error accompanied by such instruments as
are necessary to enable Lessee to make proper payment. The down cash pay-
ment is consideration for this Lease according to its terms and shall not
be allocated as a mere rental for a period. Lessee may at any time or
times execute and deliver to Lessor or to the depository above named or
place of record a release or releases of this Lease as to all or part of the
Property, or of any mineral or horizon under all or any portion thereof,
and thereby be relieved of all obligations as to the released Property or
interest. If this Lease is released as to all minerals and horizons under
a portion of the Property covered by this Lease, the rentals and other
;payments computed in accordance therewith shall thereupon be reduced in
the proportion that the number of surface acres within such released por-
tion bears to the total number of surface acres which was covered by this
Lease immediately prior to such release.
5. If prior to discovery and production of oil or gas on said
roperty or on acreage pooled therewith, Lessee shall drill a dry hole or
oles thereon, or, if after discovery and production of oil or gas, pro-
duction thereof should cease from any cause, this Lease shall not terminate
if Lessee commences operations for drilling or re-working operations six-
ty (60) days thereafter, or, if it be within the Primary Term, commences
or resumes the payment or tender of rentals or commences operations for
drilling or re-working on or before the rental paying date next ensuing
after the expiration of sixty (60) days from the date of completion of dry
hole or cessation of production. If at any time subsequent to sixty (60)
days prior to the beginning of the last year of the Primary Term and prior
to the discovery of oil or gas on said property or on acreage pooled there-
With, Lessee should drill a dry hole thereon no rental payment or operations
are necessary in order to keep the Lease in force during the remainder of
the Primary Term. If at the expiration of the Primary Term oil or gas is
not being produced on said Property or on acreage pooled therewith, but
Lessee is then engaged in drilling or re-working operations thereon or
shall have completed a dry hole thereon within sixty (60) days prior to the
end of the Primary Term the Lease shall remain in force so long as opera-
tions on said well or drilling or re-working of any additional well are
prosecuted with no cessation of more than sixty (60) consecutive days and
if they result in production of oil or gas so long thereafter as oil or
gas is produced from said Property or acreage pooled therewith. Any
pooled unit designated by Lessee in accordance with the terms hereof may
be dissolved by Lessee by an instrument filed for record in the appro-
priate records of the county or counties in which the leased premises
are situated at any time after the completion of a dry hole or the cessa-
tion of production on said unit. In the event a well or wells producing
oil or gas in paying quantities shall be brought in on adjacent land
and within 330 feet of and draining the lease premises or acreage pool-
ed therewith Lessee agrees to drill such offset wells as a reasonable
and prudent operator would drill under the same or similar circum-
stances.
6 . Lessee shall have the right at any time during or after the
expiration of this Lease to remove all property and fixtures placed by
Lessee on said Property, incimding the right to draw and remove all cas-
ing. When required by Lessor, Lessee shall bury all pipelines below
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ordinary plow depth.
7 . The rights of either party hereunder may be assigned in whole or
in part, and the provisions hereof shall extend to their heirs, successors
and assigns; but no change or division in ownership of the land, rentals
or royalties, however accomplished, shall operate to enlarge the obliga-
tions or diminish the rights of Lessee; and no change or division in such
ownership shall be binding on Lessee until thirty (30) days after Lessee
shall have been furnished by registered U. S. mail at Lessee ' s principal
place of business with a certified copy of recorded instrument or instru-
ments evidencing same. In the event of assignment hereof in whole or in
part, liability for breach of any obligation hereunder shall rest exclu-
sively upon the owner of this Lease or of a portion thereof who commits
such breach. In event of assignment of this Lease as to a segregated por-
tion of said Property, the rentals payable hereunder shall be apportion-
able as between the several leasehold owners ratably according to the sur-
face area of each, and default in rental payment by one shall not affect
the rights of other leasehold owners hereunder.
8. The breach by Lessee of any obligation arising hereunder shall not
work a forfeiture or termination of this Lease nor cause a termination or
reversion of the estate created hereby nor be grounds for cancellation
hereof in whole or in part. In the event Lessor considers that operations
are not at any time being conducted in compliance with this Lease, Lessor
shall notify Lessee in writing of the facts relied upon as constituting a
breach hereof, and Lessee, if in default, shall have sixty (60) days after
receipt of such notice in which to commence the compliance with the obli-
gations imposed by virtue of this instrument.
9. It is agreed that if this Lease covers a less interest in oil or
gas in all , or any part, of said Property than the entire and undivided fee
simple estate (whether Lessor' s interest is herein specified or not) or no
interest therein, then the royalties, delay rentals and other monies accru-
ing from any part as to which this Lease covers less than such full interest
shall be paid only in the proportion to which the interest therein, if any,
covered by this Lease bears to the whole and undivided fee simple estate
therein. All royalty interest covered by this Lease (whether or not owned
by Lessor) shall be paid out of the royalty herein provided. Failure of
Lessee to reduce rental paid hereunder shall not impair the right of Lessee
to reduce royalty.
10. Should Lessee be prevented from complying with any express or implied
covenant of this Lease, from conducting drilling or re-working operations
thereon or from producing oil or gas therefrom by reason of scarcity of or
inability to obtain or to use equipment or material, or by operation of
force majeure, any Federal or state law or any order, rule or regulation of
governmental authority, then while so prevented, Lessee ' s obligation to
comply with such covenant shall be suspended, and Lessee shall not be liable
in damages for failure to comply therewith; and this Lease shall be extend-
ed while and so long as Lessee is prevented by any such cause from conduct-
ing drilling or re-working operations on or from producing oil or gas from
the leased premises or land pooled with the leased premises; and the time
while Lessee is so prevented shall not be counted against Lessee, anything
in this Lease to the contrary notwithstanding.
11. Notwithstanding the other provisions of this Lease, it is distinct-
ly understood that Lessee shall not conduct any drilling operations or make
any installations or lay any pipeline on the leased Property until the lo-
cation of the well, installation of other equipment and any pipeline is
approved by the City of Wichita Falls and the drilling location, drilling
operations, installation and pipeline must meet the specifications design-
ed by the City of Wichita Falls to protect the water in the lake located
on the leased Property. Provided, however, Lessee does have the right to
directionally drill, produce and conduct operations and exercise all other
rights herein granted on the subsurface of the leased Property where the
surface location of such well id" off of the leased Property and such opera-
tions shall be conducted in a manner to protect the water in the lake on
the leased Property. It is understood that the above provision shall in
no way impair the pooling provisions herein.
12. Nothwithstanding the other provisions of this Lease, if , at the
end of the Primary Term, this Lease is being maintained by production of
oil or gas on the leased Property or on land pooled with the leased Property
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or is being maintained as otherwise herein provided, then at such time
thereafter as Lessee fails to commence an additional well each six (6)
months after the end of the Primary Term either on the leased Property or
on property pooled with the leased Property, then at such time all of the
leased Property shall revert to Lessor, save and except such part of the
leased Property as is included within producing pooled units or as to pro-
ducing wells on the leased Property as to such acreage as the Railroad
Commission of Texas allocates for the production of oil or gas for a pro-
ration unit on the leased Property, which, in. no event, shall exceed
eighty (80) acres for an oil well and three hundred and twenty (320)
acres for a gas well.
13 . There is no warranty of title, either expressed or implied.
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be
executed this lst day of June 1
CITY OF WICHITA FALLS, TEXAS
BY:
City Manager
ATTEST:
City Clerk
Expando Oil Company
By:
By:
By:
Partners
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I
EXHIBIT "A"
ATTACHED TO AND MADE A PART OF AN OIL AND GAS LEASE FROM
THE CITY OF WICHITA FALLS , TEXAS, AS LESSOR, TO EXPANDO OIL
COMPANY, A PARTNERSHIP, AS LESSEE.
408. 5 acres, more or less , in Archer and Wichita Counties, Texas and covering
all of the oil and gas rights owned by the City of Wichita Falls , Texas West of
the Easterly line of Tract 1 described below and South of the North line of
J. A. Scott Survey No. 4 and the South line of Blocks 22, 23 and 24 of Denton
County School Land, League No. 1 , Wichita County, Texas , located in or adjacent'
to Lake Wichita and including , but not limited to, the following described tracts,
to-wit:
Tract 1: (a) 200 acres of land, being part of J . A. Scott Survey Nos . 4 and 5,
situated partly in Wichita and partly in Archer Counties , Texas .
BEGINNING at the Northeast corner of a 100 acre tract conveyed by Otis T. Bacon
to W. H. Bachman, Jr. ; THENCE South 1344 vrs . to a stake for corner; THENCE West
921 .9 vrs . to a stake for corner ; THENCE North 1044 vrs . to a stake for corner;
THENCE East 365 .6 vrs . to a stake for corner ; THENCE North 300 vrs . to a stake
for corner ; THENCE East 556 vrs. to the place of beginning, and containing 200
acres of land.
.(b) 95.5 acres of land, being a part of said John A. Scott Survey No.
4 described by metes and bounds as follows :
BEGINNING at the Northwest corner of the 200 acre tract above described ; THENCE
South 1044 vrs ; THENCE West 515 vrs; THENCE North 1044 vrs ; THENCE East 515 vrs .
to the place of beginning, and containing 95.5 acres of land.
The two above described tracts of land being the same land conveyed by H . J .
Bachman and wife to C. W. Bean by Deed dated September 3, 1900, which Deed is
recorded in Book 40, Page 403, Deed Records of Wichita County, Texas, SAVE AND
EXCEPT 133 acres of land heretofore sold out of said above tract of land by
Henry Sayles and C. W. Bean to G. R. Decker, by Deed dated November 10 , 1900 and
recorded in Book 31 , Page 382, Deed Records of Archer County, Texas .
Tract 2: A tract of land situated in Archer County, Texas, being a part of the
John A. Scott Surveys Nos. 4 and 5, described as follows :
BEGINNING at the Southwest corner of a tract of 100 acres conveyed to Otis T.
Bacon to W. H. Bachman, Sr. , THENCE North 148-1/38 vrs. to a stone for corner;
THENCE West 380 vrs. to a stone for corner; THENCE South 148-1 /38 vrs . to a stone
for corner ; THENCE East 380 vrs . to the place of beginning, containing 10 acres
of land, and being the same land conveyed by L. J . Brown , et al , to C. W. Bean
by Deed dated October 9, 1900, and recorded in Book 31 , Page 123, Deed Records
of Archer County, _Texas .
Tract 3: 123 acres of land out of John A. Scott Survey No. 4; BEGINNING at the
Northeast corner of the G. R. Decker Home tract of land and beginning at
the Northwest corner of the Aton-Bachman tract out of same Survey on the South
line of Denton County School Land, League No. 2; THENCE West with with said
South line of Denton County School Land 2350 feet to the Northeast corner of
Albert Ludolphus tract out of said Survey No. 4; THENCE South with the East
line of said Ludolphus tract 2220 feet to the water line of the proposed
Reservoir on Holliday Creek, when even full with water; THENCE with said
water line approximately Southeasterly 1000 feet and Northeasterly 1800 feet
to the West line of said Aton-Bachman tract; THENCE North with said Aton-
Bachman tract 's .West line 1670 feet to place of beginning, containing 123 acres
of land, and being the same land conveyed by G. R. Decker and wife to Henry
Sayles , Trustee by Deed dated November 10, 1900, which Deed is recorded in
Book 31 , Page 349, Deed Records of Archer County, Texas.
Tract 4: A tract of land in Archer County, Texas, part of John A. Scott Survey
No. 4; BEGINNING at the Southwest corner of G. W. Decker 's tract of
land out of said Survey; THENCE North with said Decker 's West line 1350 feet
to the water line of the Reservoir to be constructed on Holliday Creek, when
said Reservoir is even full ; THENCE Westerly and Southwesterly with said water
line of said Reservoir to the East line of the Koeing tract out of same Survey;
THENCE South 300 feet to the Southeast corner of said Koeing tract ; THENCE East
with the South line of said John A. Scott Survey No. 4, 1900 feet to place of
beginning , containing 48 acres of land, and being the same land conveyed by
Albert Ludolphus and wife to Henry Sayles, Trustee, by Deed dated November 2,
1900, which Deed is Recorded in Book 31 , Page 193, Deed Records of Archer
County, Texas.
Tract 5: A tract of land situated in Archer and Wichita Counties, Texas, being
part of John A. Scott Survey No. 4; BEGINNING at the West line of the
G. R. Decker Tract of land out of said Survey, at a point approximately 1350
feet North of the Southwest corner of said Decker ' s tract; THENCE Westerly and
Southwesterly with the water line of said Reservoir when even full of water,
to the East line of Koenig 's tract of land out of the same survey, at a point
approximately 300 feet North of the Southeast corner of said Koeing 's tract
to the water line of said reservoir when even full ; THENCE Northerly with
East line of Koenig ' s tract to eater line of Reservoir when even full ; THENCE
Easterly with said water line to the West line of said Decker tract; THENCE
South with the West line of said Decker ' s tract, 1600 feet to the place of
beginning , containing 65 acres of land, and being the same land conveyed by
Albert Ludolphus and wife to Henry Sayles , Trustee by Deed dated November 2,
1900, which Deed is recorded in Book 31 , on Pages 182 and 183, Deed Records of
Archer County, Texas .
The tracts of land described above, and covered by the attached Oil and Gas Lease,
are further indicated on the attached Plat colored in yellow and it being the in-
tention to cover all of the oil and gas rights of the City of Wichita Falls , Texas
within the area indicated on such Plats , and as described above, under the terms
and provisions of the attached Oil and Gas Lease.
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OIL AND GAS LEASE
STATE OF TEXAS X
COUNTIES OF ARCHER X KNOW ALL MEN BY THESE PRESENTS THAT:
AND WICHITA
X
WHEREAS, the City of Wichita Falls, Texas ("Lessor" ) , is the owner
of the tracts of land in said County and State described in Exhibit "A"
attached hereto, incorporated herein by reference and made a part hereof
for all purposes (the "Property") ;
WHEREAS , Lessor has determined that it is advisable and in the best in-
terest of the City of Wichita Falls, Texas to lease the Property for pur-
pose of producing the oil and gas thereunder in a manner which will not
interfere with the public use of the Property;
WHEREAS, Lessor has given notice of its intention to lease the
Property in accordance with Sections 71. 004 and 71. 005 of the State of
Texas Natural Resources Code (the "Code") and has received and considered
bids, at a public hearing, in accordance with Section 71. 006 of the Code;
WHEREAS , Expando Oil Company, a partnership 01
( "Lessee" ) was the highest and best bidder who submitted a bid for the lease
of the Property;
WHEREAS, Lessor desires to lease the Property to Lessee for the purpose
of producing the oil and gas thereunder, and Lessee desires to accept such
lease from Lessor, in accordance with the terms, provisions and conditions
hereinafter set forth;
NOW, THEREFORE , for and in consideration of Seven and 50/100 Dollars ($7 . 50)
per net mineral acre and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Lessor has granted, de-
mised, leased and let, and by these presents does grant, demise, lease
and let, unto Lessee all of the Property described in the attached Exhibit
"A" for the purpose of investigating, exploring, prospecting and drilling
for and producing the oil and gas thereunder and to save , take care of,
treat, transport and own said oil and gas.
1. Subject to the other provisions herein contained, this lease
shall remain in force for a term of 1/8 years from the date hereof
(called the "Primary Term" ) and as long thereafter as oil and gas, or
either of them, is produced from said Property or land with which said
property is pooled herewith.
2. The royalties to be paid by Lessee are (a) on oil 1ZS of that pro-
duced and saved from said Property, the same to be delivered at the wells
or to the credit of Lessor into the pipeline to which the wells may be
connected; Lessee may from time to time purchase any royalty oil in its
possession, paying the market price therefor prevailing for the field where
produced on the date of purchase; (b) to pay Lessor on gas and casinghead
gas produced from said land (1) when sold by Lessee 1/8 of the amount
realized by Lessee computed at the mouth of the well, or (2) when used by
Lessee off said land or in the manufacture of gasoline or other products ,
1/8 of the amount realized from the sale of gasoline or other products
extracted therefrom and 1/8 of the amount realized from the sale of res-
idue gas after deducting the amount used for plant fuel and/or compression;
while there is a gas well on this Property or on acreage pooled therewith
but gas is not being sold or used, Lessee may pay as royalty, on or before
ninety (90) days after the date on w ich (1) said well is shut in, or (2)
the Property covered hereby or any p rtion thereof is included in a pooled
unit on which a well is located, or (3) this lease ceases to be otherwise
maintained as provided herein whichever is the later date, and thereafter
at annual intervals on or before the anniversary of the date the first
payment is made, a sum of Two Hundred and No/100 ($200. 00) per well, and
if such payment is made or tendered, this lease shall not terminate and
it will be considered that gas is being produced from this lease in pay-
ing quantities. Lessee shall have free use of oil and gas from said
Property for all operations hereunder and the royalty on oil and gas shall
be computed after deducting any so used.
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3. Lessee, at its option, is hereby given the right and power to
pool or combine the Property or any portion thereof as to oil and gas, or
either of them, with other land, lease or leases in the iYmnediate vicinity
thereof to the extent hereinafter stipulated in order to produce the oil
and gas underneath the Property, provided however, that in a unit pooled
for oil or gas, said oil or gas unit shall be composed of no less than fif-
ty percent (50%) acreage from the Property, or the entire Property, which-
ever is the lesser amount of acreage. Units pooled for oil hereunder shall
not substantially exceed eighty (80) acres each in area, and units pooled
for gas hereunder shall not substantially exceed in area three hundred
twenty (320) acres each, plus a tolerance of ten per cent (10%) thereof,
Provided that any such unit may not contain more than the minimum number
of acres on which an oil and gas well must be located to comply with rules
or orders of the Railroad Commission of Texas as applied to the Property.
Lessee under the provisions hereof may pool or combine the Property or
any portion thereof as above provided as to oil in any one or more strata
and as to gas in any one or more strata. The units formed by pooling as
to any stratum or strata need not conform in size or area with the unit or
units into which the Property is pooled or combined as to any other stratum
or strata and oil units need not conform as to area with gas units. The
pooling in one or more instances shall not exhaust the rights of the Lessee
hereunder to pool the Property or portions thereof into any other units.
Lessee shall file for record in the appropriate records of the county or
counties in which the Property is located, an instrument describing and
designating the pooled acreage as a pooled unit; and upon such recordation
the unit shall be effective as to all parties hereto, their successorsand
assigns; irrespective of whether or not the unit is likewise effective as
to all other owners of surface, mineral, royalty or other rights in land
included in such unit. Operations for drilling on or production of oil
or gas from any part of the pooled unit which includes all or any portion
of the Property, shall be considered as operations for drilling or pro-
duction of oil or gas from the Property and the entire acreage constitut-
ing such unit or units , as to oil and gas , or either of them, as herein
provided, shall be treated for all purposes , except the payment of royal-
ties upon production from the pooled unit, as if the same were included
in this Lease. For the purpose of computing the royalties to which own-
ers of royalties and payments out of production shall be entitled on
production of oil and gas, or either of them, from the pooled unit, there
shall be allocated to the Property and included in said unit a pro rata
portion of the oil and gas , or either of them, produced from the pooled
unit. Such allocation shall be on an acreage basis (that is, there shall
be allocated to the acreage covered by this Lease and included in the
pooled unit that pro rata portion of the oil and gas , or either of them,
produced from the pooled unit which is the number of surface acres cover-
ed by this Lease and included in the pooled unit bears to the total number
of surface acres included in the pooled unit) . Royalties hereunder shall
be computed on the portion of such production, whether it be oil and gas,
or either of them, so allocated to the Property and included in the unit
just as though such production were from the Property. The production
from an oil well will be considered production from the lease or oil pool-
ed unit from which it is producing and not as production from a gas pooled
unit; and production from a gas well will be considered as production
from the lease or gas pooled unit from which it is producing and not from
an oil pooled unit.
4 . If operations for drilling are not commenced on said Property or
acreage pooled therewith as above provided on or before one (1) year from
this date, the Lease shall then terminate as to both parties , unless on
or before such anniversary date Lessee shall pay or tender (or shall make
a bona fide attempt to pay or tender, as hereinafter stated) to Lessor or
to the credit of Lessor in Parker Square State
Bank at Wichita Falls, Texas, (which bank and its successors are Lessor' s
agent and shall continue as the depository for all rentals payable here-
under regardless of changes in ownership of said Property or the rentals)
the sum of ONE DOLLAR ($1. 00) per acre for the number of acres then sub-
ject to this Lease (hereinafter called "Rental") , which shall cover the
privilege of deferring commencement of drilling operations for period of
twelve (12) months. In like manner and upon like payments or tenders
annually, the commencement of drilling operations may be further deferr-
ed for successive period of twelve (12) months each during the primary
term. The payment or tender of rental under this paragraph and of
royalty under Paragraph 2 on any gas well from which gas is not being
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5/79
sold or used may be made by check or draft of Lessee mailed or delivered
to the parties entitled thereto or to said bank on or before the date of
payment. If such bank (or any successor bank) should fail, liquidate or
be succeeded by another bank, or for any reason fail or refuse to accept
rental, Lessee shall not be held in default for failure to make such pay-
ment or tender of rental until thirty (30) days after Lessor shall deliver
to Lessee a proper recordable instrument naming another bank as agent to
receive such payments or tenders. If Lessee shall, on or before any anni-
versary date, make a bona fide attempt to pay or deposit rental to a Lessor
entitled thereto according to Lessee ' s records or to a Lessor, who, prior
to such attempted payment or deposit, has given Lessee notice, in accord-
ance with subsequent provisions of this Lease, of the right to receive
rental, and if such payment or deposit shall be ineffective or erroneous
in any regard, Lessee shall be unconditionally obligated to pay to such
Lessor the rental propgrly payable for the rental period involved, and
this Lease shall not terminate but shall be maintained in the same manner
as if such erroneous or ineffective rental payment or deposit has been pro-
perly made, provided that the erroneous or ineffective rental payment or
deposit be corrected within 30 days after receipt by Lessee of written
notice from such Lessor of such error accompanied by such instruments as
are necessary to enable Lessee to make proper payment. The down cash pay-
ment is consideration for this Lease according to its terms and shall not
be allocated as a mere rental for a period. Lessee may at any time or
times execute and deliver to Lessor or to the depository above named or
place of record a release or releases of this Lease as to all or part of the
Property, or of any mineral or horizon under all or any portion thereof,
and thereby be relieved of all obligations as to the released Property or
interest. If this Lease is released as to all minerals and horizons under
a portion of the Property covered by this Lease, the rentals and other
payments computed in accordance therewith shall thereupon be reduced in
the proportion that the number of surface acres within such released por-
4iase
on bears to the total number of surface acres which was covered by this
immediately prior to such release.
5. If prior to discovery and production of oil or gas on said
Property or on acreage pooled therewith, Lessee shall drill a dry hole or
=oles thereon, or, if after discovery and production of oil or gas , pro-
tion thereof should cease from any cause, this Lease shall not terminate
if Lessee commences operations for drilling or re-working operations six-
ty (60) days thereafter, or, if it be within the Primary Term, commences
or resumes the payment or tender of rentals or commences operations for
drilling or re-working on or before the rental paying date next ensuing
after the expiration of sixty (60) days from the date of completion of dry
hole or cessation of production. If at any time subsequent to sixty (60)
days prior to the beginning of the last year of the Primary Term and prior
to the discovery of oil or gas on said property or on acreage pooled there-
with, Lessee should drill a dry hole thereon no rental payment or operations
are necessary in order to keep the Lease in force during the remainder of
the Primary Term. If at the expiration of the Primary Term oil or gas is
not being produced on said Property or on acreage pooled therewith, but
Lessee is then engaged in drilling or re-working operations thereon or
shall have completed a dry hole thereon within sixty (60) days prior to the
end of the Primary Term the Lease shall remain in force so long as opera-
tions on said well or drilling or re-working of any additional well are
prosecuted with no cessation of more than sixty (60) consecutive days and
if they result in production of oil or gas so long thereafter as oil or
gas is produced from said Property or acreage pooled therewith. Any
pooled unit designated by Lessee in accordance with the terms hereof may
be dissolved by Lessee by an instrument filed for record in the appro-
priate records of the county or counties in which the leased premises
are situated at any time after the completion of a dry hole or the cessa-
tion of production on said unit. In the event a well or wells producing
oil or gas in paying quantities shall be brought in on adjacent land
and within 330 feet of and draining the lease premises or acreage pool-
ed therewith Lessee agrees to drill such offset wells as a reasonable
and prudent operator would drill under the same or similar circum-
stances.
6. Lessee shall have the right at any time during or after the
expiration of this Lease to remove all property and fixtures placed by
Lessee on said Property, inclmding the right to draw and remove all cas-
ing. When required by Lessor, Lessee shall bury all pipelines below
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5/79
ordinary plow depth.
7. The rights of either party hereunder may be assigned in whole or
in part, and the provisions hereof shall extend to their heirs, successors
and assigns; but no change or division in ownership of the land, rentals
or royalties, however accomplished, shall operate to enlarge the obliga-
tions or diminish the rights of Lessee; and no change or division in such
ownership shall be binding on Lessee until thirty (30) days after Lessee
shall have been furnished by registered U. S. mail at Lessee ' s principal
place of business with a certified copy of recorded instrument or instru-
ments evidencing same. In the event of assignment hereof in whole or in
part, liability for breach of any obligation hereunder shall rest exclu-
sively upon the owner of this Lease or of a portion thereof who commits
such breach. In event of assignment of this Lease as to a segregated por-
tion of said Property, the rentals payable hereunder shall be apportion-
able as between the several leasehold owners ratably according to the sur-
face area of each, and default in rental payment by one shall not affect
the rights of other leasehold owners hereunder.
8. The breach by Lessee of any obligation arising hereunder shall not
work a forfeiture or termination of this Lease nor cause a termination or
reversion of the estate created hereby nor be grounds for cancellation
hereof in whole or in part. In the event Lessor considers that operations
are not at any time being conducted in compliance with this Lease, Lessor
shall notify Lessee in writing of the facts relied upon as constituting a
breach hereof, and Lessee, if in default, shall have sixty (60) days after
receipt of such notice in which to commence the compliance with the obli-
gations imposed by virtue of this instrument.
9. It is agreed that if this Lease covers a less interest in oil or
gas in all , or any part, of said Property than the entire and undivided fee
simple estate (whether Lessor' s interest is herein specified or not) or no
interest therein, then the royalties, delay rentals and other monies accru-
ing from any part as to which this Lease covers less than such full interest
shall be paid only in the proportion to which the interest therein, if any,
covered by this Lease bears to the whole and undivided fee simple estate
therein. All royalty interest covered by this Lease (whether or not owned
by Lessor) shall be paid out of the royalty herein provided. Failure of
Lessee to reduce rental paid hereunder shall not impair the right of Lessee
to reduce royalty.
10. Should Lessee be prevented from complying with any express or implied
covenant of this Lease, from conducting drilling or re-working operations
thereon or from producing oil or gas therefrom by reason of scarcity of or
inability to obtain or to use equipment or material, or by operation of
force majeure, any Federal or state law or any order, rule or regulation of
governmental authority, then while so prevented, Lessee ' s obligation to
comply with such covenant shall be suspended, and Lessee shall not be liable
in damages for failure to comply therewith; and this Lease shall be extend-
ed while and so long as Lessee is prevented by any such cause from conduct-
ing drilling or re-working operations on or from producing oil or gas from
the leased premises or land pooled with the leased premises; and the time
while Lessee is so prevented shall not be counted against Lessee, anything
in this Lease to the contrary notwithstanding.
11. Notwithstanding the other provisions of this Lease, it is distinct-
ly understood that Lessee shall not conduct any drilling operations or make
any installations or lay any pipeline on the leased Property until the lo-
cation of the well, installation of other equipment and any pipeline is
approved by the City of Wichita Falls and the drilling location, drilling
operations, installation and pipeline must meet the specifications design-
ed by the City of Wichita Falls to protect the water in the lake located
on the leased Property. Provided, however, Lessee does have the right to
directionally drill, produce and conduct operations and exercise all other
rights herein granted on the subsurface of the leased Property where the
surface location of such well is off of the leased Property and such opera-
tions shall be conducted in a manner to protect the water in the lake on
the leased Property. It is understood that the above provision shall in
no way impair the pooling provisions herein.
12. Nothwithstanding the other provisions of this Lease, if , at the
end of the Primary Term, this Lease is being maintained by production of
oil or gas on the leased Property or on land pooled with the leased Property
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or is being maintained as otherwise herein provided, then at such time
thereafter as Lessee fails to commence an additional well each six (6)
months after the end of the Primary Term either on the leased Property or
on property pooled with the leased Property, then at such time all of the
leased Property shall revert to Lessor, save and except such part of the
leased Property as is included within producing pooled units or as to pro-
ducing wells on the leased Property as to such acreage as the Railroad
Commission of Texas allocates for the production of oil or gas for a pro-
ration unit on the leased Property, which, in no event, shall exceed
eighty (80) acres for an oil well and three hundred and twenty (320)
acres for a gas well.
13. There is no warranty of title, either expressed or implied.
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be
executed this 1st day of June
CITY OF WICHITA FALLS, TEXAS
BY:
City Manager
ATTEST:
City Clerk
Expando Oil Company
By:
By:
By
Partners
-5-
EXHIBIT ''A''
ATTACHED TO AND MADE A PART OF AN OIL. AND GAS LEASE FROM THE CITY OF
WICHITA FALLS , TEXAS , AS LESSOR, TO EXPANDO OIL COMPANY, A PARTNERSHIP,
AS LESSEE.
900.95 acres , more or less , in Archee and Wichita Counties , Texas, and covering
all of the oil and gas rights owned by the City of Wichita Falls, Texas out of the
John A. Scott Survey No. 6, Abstract 30, Certificate 41 ; all of Block 35, League
No. 1 , Denton County School Land ; all of Block 36, League No. 1 , Denton County
School Land; and that portion of John A. Scott Survey No. 5 lying east of a
projection of the west line of Block No. 35, League No. 1 , Denton County School,
Land in a southerly direction and including the following described tracts .
Tract 1 : 432.50 acres of land out of the John A. Scott Survey No. 6, Abstract
No. 301 , Certificate No. 41 described as follows :
BEGINNING at the Northeast corner of John A. Scott Survey No. 5 ; THENCE North
556 varas to a corner; THENCE East 1285 vrs ; THENCE South 1900 vrs ; THENCE West
1285 vrs . to the Southwest corner of John A. Scott Survey No. 6; THENCE North
1344 vrs . to the place of beginning, located partly in Wichita and partly in
Archer Counties , Texas , and being the same land conveyed by R. 0. C. Lynch to
C. W. Bean by Deed dated October 19th, 1900, which Deed is recorded in Book
No. 40, Page 448, Deed Records of Wichita County, Texas.
Tract 2: 208 acres of land off the East side of John A. Scott Survey No. 6,
located by virtue of Certificate issued to Thomas Toby, and patented
to John A. Scott, Assignee, Patent No. 647 1/2, Volume 2, as shown by the
Abstracts of Texas Land Titles , and for a more particular description of said
tract, reference is hereby made to said Patent, this being the same land conveyed
to Henry Sayles by Caroline S. Gibbs , et al , by Deed dated November 19, 1900,
and recorded in Book 40, Page 621 , Deed Records of Wichita County, Texas ; also
by. Deed from Ellen Nelon, et al , to Henry Sayles dated November 19, 1900 and
recorded in Book 40, Page No. 620, Deed Records of Wichita County, Texas .
The above 2 tracts out of the Scott Survey No. 6, SAVE AND EXCEPT 60
acres out of 432. 5 ,acre tract out of the Scott Survey No. 6 and SAVE AND EXCEPT
43.2 acres out of the 208 acre tract out of the Scott Survey No. 6, which lands
were conveyed to T. R. T. Orth by C . W. Bean and Henry Sayles , Trustees , by Deed
dated June 18, 1908 which Deed is recorded in Book 50, Page 583, Deed Records of
Wichita County, Texas.
Tract 3: A certain tract or parcel of land in Wichita County, Texas , being a
part of Block No. 36, League No. 1 , Denton County School Land described
as follows :
BEGINNING at the ,Southwest corner of Simpson tract ; THENCE East with the South
line of said tract, which is also the North line of John A. Scott Survey No. 6,
1650 feet to a point Northeast of and 125 feet distant from the center line of
the Kempner Dam, as now located; THENCE North 58 degrees West ; parallel with and
125 feet distant from said center line, 1950 feet to the West line of the said
Simpson tract; THENCE South with said West line 1000 feet to the place of
beginning, containing 19 acres of land, being the same land conveyed by R. F.
Simpson to C. W. Bean by Deed dated October 27, 1900, which Deed is recorded in
Book No. 40, Page No. 602, Deed Records of Wichita County, Texas.
Tract 4: All that certain tract or parcel of land situated in Wichita County, Texas ,
known as Block No. 35, League No. 1 , Denton County School Land, more
particularly described as follows :
BEGINNING at a Rock marked NWC, J. A. Scott Survey No . 6, it being the Northwest
corner of said Scott Survey No. 6; THENCE East 18-1/2 vrs . a Rock the Southwest
corner of Block No. 36, Rock marked L1SWC Block 36; THENCE North 749 vrs . a Rock
marked L 1 SWC Block 25; THENCE West 915-1/2 vrs . a Rock marked L 1SWC Block 26;
THENCE South 1394 vrs . a Rock on the South Boundary line. of League No. 1 , Denton
County School Land and North Boundary line of John A. Scott Survey No. 5, marked
L 1 SWC 35; THENCE East 897 vrs . a Rock marked NEC 5, the Northeast corner John A.
Scott Survey No. 5; THENCE North 646 vrs . to the place of beginning, containing
224. 1 acres of land and being the same land conveyed by John Myers , et al , to
C. W. Bean by Deed dated December 10, 1901 , which Deed is recorded in Book 42,
Page 338, Deed Records of Wichita County , Texas , LESS a tract of land out of the
Northeast corner of said Block 35, which tract of land is North of the said Dam
of Lake Wichita and is not covered by the waters of said lake, containing about
31 acres of land, more or less .
Tract 5: 151 acres , more or less, out of John A. Scott Survey No. 5 lying partly in
Wichita and partly in Archer County, Texas , as follows :
BEGINNING at the Northeast corner of said Scott Survey No. 5; THENCE South 1344,
vrs . a stake in the North line of the Harvey Cox Survey ; THENCE West approximately
897 vrs. to a point in the South line of Survey No. 5 due South of the Southwest
corner of Block 35, League No. 1 , Denton County School Land; THENCE North 1344
vrs . to the Southwest corner of said Block 35 ; THENCE East 897 vrs . to the place
of beginning, SAVE AND EXCEPT 62 acres of land being the same land conveyed by
C. W. Bean and Henry Sayles, Trustees, to Thos . R. T. Orth out of said tract by
Deed dated June 18, 1908, recorded in Book 50, Page 583, Deed Records of Wichita
County, Texas.
The tracts of land described above , and covered by the attached Oil
and Gas Lease, are further indicated on the attached Plat colored in
yellow and it being the intention to cover all of the oil and gas
rights of the City of Wichita Falls, Texas within the area indicated
on such Plats, and as described above, under the terms and provisions
of the attached Oil and Gas Lease.
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5/79
OIL AND ; AS LEASE
S'TAT- ''zF TFX;. S X
COUNTY OF ARCHER X KNOW ALL MEN BY THESE PRESENTS THAT:
X
WHEREAS, the City of Wichita Falls, Texas ("Lessor") , is the owner
Of the tracts of land in said County and State described in Exhibit "A
attached hereto, incorporated herein by reference and made a part hereof
for all piirposes (the "Property") ;
WHEREAS, Lessor has determined that it is advisable and in the best in-
terest of the City of Wichita Falls, Texas to lease the Property for pur-
pose of producing the oil and gas thereunder in a manner which will not
interfere with the public use of the Property;
WHEREAS, Lessor has given notice of its intention to lease the
Property in accordance with Sections 71. 004 and 71. 005 of the State of
Texas Natural Resources Code (the "Code") and has received and considered
bids, at a public hearing, in accordance with Section 71. 006 of the Code;
WHEREAS, Tuthill & Barbee
("Lessee") was the highest and best bidder who submitted a bid for the lease
of the Property;
WHEREAS, Lessor desires to lease the Property to Lessee for the purpose
of producing the oil and gas thereunder, and Lessee desires to accept such
lease from Lessor, in accordance with the terms, provisions and conditions
hereinafter set forth;
NOW, THEREFORE, for and in consideration of Twenty-Five Dollars ($25) per
net mineral acre and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Lessor has granted, de-
mised, leased and let, and by these presents does grant, demise, lease
and let, unto Lessee all of the Property described in the attached Exhibit
"A" for the purpose of investigating, exploring, prospecting and drilling
for and producing the oil and gas thereunder and to save, take care of,
treat, transport and own said oil and gas.
1. Subject to the other provisions herein contained, this lease
shall remain in force for a term of three years from the date hereof
(called the "Primary Term" ) and as long thereafter as oil and gas, or
either of them, is produced from said Property or land with which said
property is pooled herewith.
2. The royalties. to be paid by Lessee are (a) on oil 1/8 of that pro-
duced and saved from said Property, the same to be delivered at the wells
or to the credit of Lessor into the pipeline to which the wells may be
connected; Lessee may from time to time purchase any royalty oil in its
possession, paying the market price therefor prevailing for the field where
produced on the date of purchase; (b) to pay Lessor on gas and casinghead
gas produced from said land (1) when sold by Lessee 1 8 of the amount
realized by Lessee computed at the mouth of the we' ll—, or when used by
Lessee off said land or in the manufacture of gasoline or other products,
_ of the amount realized from the sale of gasoline or other products
extracted therefrom and 1/8 of the amount realized from the sale of res-
idue gas after deducting the amount used -for plant fuel and/or compression;
while there is a gas well on this Property or on acreage pooled therewith
but gas is not being sold or used, Lessee may pay as royalty, on or before
ninety (90) days after the date on which (1) said well is shut in, or (2)
the Property covered hereby or any portion thereof is included in a pooled
unit on which a well is located, or (3) this lease ceases to be otherwise
maintained as provided herein whichever is the later date, and thereafter
at annual intervals on or before the anniversary of the date the first
payment is made, a sum of Two Hundred and No/100 ($200. 00) per well, and
if such payment is made or tendered, this lease shall not terminate and
it will be considered that gas is being produced from this lease in pay-
ing quantities. Lessee shall have free use of oil and gas from said
Property for all operations hereunder and the royalty on oil and gas shall
be computed after deducting any so used.
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3 . Lessee, at its option, is hereby given the right and power to
pool or combine the Property or any portion thereof as to oil and gas, or
either of them, with other land, lease or leases in the immediate vicinity
thereof to the extent hereinafter stipulated in order to produce the oil
and gas underneath the Property , provided however , that in a unit pooled
for oil or gas, said oil or gas unit shall be composed of no less than fif-
ty percent (500) acreage from the Property, or the entire Property, which-
ever is the lesser amount of acreage. Units pooled for oil hereunder shall
not substantially exceed eighty (80) acres each in area, and units pooled
for gas hereunder shall not substantially exceed in area three hundred
twenty (320) acres each, plus a tolerance of ten per cent (100) thereof,
provided that any such unit may not contain more than the minimum number
of acres on which an oil and gas well must be located to comply with rules
or orders of the Railroad Commission of Texas as applied to the Property.
Lessee under the provisions hereof may pool or combine the Property or
any portion thereof as above provided as to oil in any one or more strata
and as to gas in any one or more strata. The units formed by pooling as
to any stratum or strata need not conform in size or area with the unit or
units into which the Property is pooled or combined as to any other stratum
or strata and oil units need not conform as to area with gas units. The
Pooling in one or more instances shall not exhaust the rights of the Lessee
hereunder to pool the Property or portions thereof into any other units.
Lessee shall file for record in the appropriate records of the county or
counties in which the Property is located, an instrument describing and
designating the pooled acreage as a pooled unit; and upon such recordation
the unit shall be effective as to all parties hereto, their successorsand
assigns; irrespective of whether or not the unit is likewise effective as
to all other owners of surface, mineral, royalty or other rights in land
included in such unit. Operations for drilling on or production of oil
or gas from any part of the pooled unit which includes all or any portion
of the Property, shall be considered as operations for drilling or pro-
duction of oil or gas from the Property and the entire acreage constitut-
ing such unit or units , as to oil and gas , or either of them, as herein
provided, shall be treated for all purposes , except the payment of royal-
ties upon production from the pooled unit, as if the same were included
in this Lease. For the purpose of computing the royalties to which own-
ers of royalties and payments out of production shall be entitled on
production of oil and gas, or either of them, from the pooled unit , there
shall be allocated to the Property and included in said unit a pro r.ata
portion of the oil and gas , or either of them, produced from the pooled
unit. Such allocation shall be on an acreage basis (that is , there shall
be allocated to the acreage covered by this Lease and included in the
Pooled unit that pro rata portion of the oil and gas , or either of them,
produced from the pooled unit which is the number of surface acres cover-
ed by this Lease and included in the pooled unit bears to the total number
of surface acres included in the pooled unit) . Royalties hereunder shall
be computed on the portion of such production, whether it be oil and gas ,
or either of them, so allocated to the Property and included in the unit
just as though such production were from the Property. The production
from an oil well will be considered production from the lease or oil. pool-
ed unit from which it is producing and not as production from a gas pooled
unit; and production from a gas well will be considered as production
from the lease or gas pooled unit from which it is producing and not from
an oil pooled unit.
4 . If operations for drilling are not commenced on said Property or
acreage pooled therewith as above provided on or before one (1) year from
this date, the Lease shall then terminate as to both parties , unless on
or before such anniversary date Lessee shall pay or tender (or shall make
a bona fide attempt to pay or tender, as hereinafter stated) to Lessor or
to the credit of Lessor in Parker Square State
Bank at Wichita Falls, Texas , (which bank and its successors are Lessor' s
agent and shall continue as the depository for all rentals payable here-
under regardless of changes in ownership of said Property or the rent-als)
the sum of ONE DOLLAR ($1. 00) per acre for the number of acres then sub-
ject to this Lease (hereinafter called "Rental") , which shall cover the
privilege of deferring commencement of drilling operations for period of
twelve (12) months. In like manner and upon like payments or tenders
annually, the commencement of drilling operations may be further deferr-
ed for successive period of twelve (12) months each during the primary
term. The payment or tender of rental under this paragraph and of
royalty under Paragraph 2 on any gas well from which gas is not being
-2-
5/79
sold or used may be made by check or draft of Lessee mailed or delivered
to the parties entitled thereto or to said bank on or before the date of
payment . If such bank (or any successor bank) should fail, liquidate or
be succeeded by another bank, or for any reason fail or refuse to accept
rental, Lessee shall not be held in default for failure to make such pay-
ment or tender of rental until thirty (30) days after Lessor shall deliver
to Lessee a proper recordable instrument naming another bank as agent to
receive such payments or tenders. If Lessee shall, on or before any anni-
versary date, make a bona fide attempt to pay or deposit rental to a Lessor
entitled thereto according to Lessee ' s records or to a Lessor, who, prior
to such attempted payment or deposit, has given Lessee notice, in accord-
ance with subsequent provisions of this Lease, of the right to receive
rental , and if such payment or deposit shall be ineffective or erroneous
in any regard, Lessee shall be unconditionally obligated to pay to such
Lessor the rental propEkrly payable for the rental period involved, and
this Lease shall not terminate but shall be maintained in the same manner
as if such erroneous or ineffective rental payment or deposit has been pro-
perly made, provided that the erroneous or ineffective rental payment or
deposit be corrected within 30 days after receipt by Lessee of written
notice from such Lessor of such error accompanied by such instruments as
are necessary to enable Lessee to make proper payment. The down cash pay-
ment is consideration for this Lease according to its terms and shall not
be allocated as a mere rental for a period. Lessee may at any time or
times execute and deliver to Lessor or to the depository above named or
place of record a release or releases of this Lease as to all or part of the
Property, or of any mineral or horizon under all or any portion thereof,
and thereby be relieved of all obligations as to the released Property or
interest. If this Lease is released as to all minerals and horizons under
a portion of the Property covered by this Lease, the rentals and other
payments computed in accordance therewith shall thereupon be reduced in
the proportion that the number of surface acres within such released por-
tion bears to the total number of surface acres which was covered by this
Lease immediately prior to such release.
5. If prior to discovery and production of oil or gas on said
Property or on acreage pooled therewith, Lessee shall drill a dry hole or
holes thereon, or, if after discovery and production of oil or gas , pro-
duction thereof should cease from any cause , this Lease shall not terminate
if Lessee commences operations for drilling or re-working operations six-
ty (60) days thereafter, or, if it be within the Primary Term, commences
or resumes the payment or tender of rentals or commences operations for
drilling or re-working on or before the rental paying date next ensuing
after the expiration of sixty (60) days from the date of completion of dry
hole or cessation of production. If at any time subsequent to sixty (60)
days prior to the beginning of the last year of the Primary Term and prior
to the discovery of oil or gas on said property or on acreage pooled there-
with, Lessee should drill a dry hole thereon no rental payment or operations
are necessary in order to keep the Lease in force during the remainder of
the Primary Term. If at the expiration of the Primary Term oil or qas is
not being produced on said Property or on acreage pooled therewith, but
Lessee is then engaged in drilling or re-working operations thereon or
shall have completed a dry hole thereon within sixty (60) days prior to the
end of the Primary Term the Lease shall remain in force so long as opera-
tions on said well or drilling or re-working of any additional well are
prosecuted with no cessation of more than sixty (60) consecutive days and
if they result in production of oil or gas so long thereafter as oil or
gas is produced from said Property or acreage pooled therewith. Any
pooled unit designated by Lessee in accordance with the terms hereof may
be dissolved by Lessee by an instrument filed for record in the appro-
priate records of the county or counties in which the leased premises
are situated at any time after the completion of a dry hole or the cessa-
tion of production on said unit. In the event a well or wells producing
oil or gas in paying quantities shall be brought in on adjacent land
and within 330 feet of and draining the lease premises or acreage pool-
ed therewith Lessee agrees to drill such offset wells as a reasonable
and prudent operator would drill under the same or similar circum-
stances.
6 . Lessee shall have the right at any time during or after the
expiration of this Lease to remove all property and fixtures placed by
Lessee on said Property, inclmding the right to draw and remove all cas-
ing. When required by Lessor, Lessee shall bury all pipelines below
-3-
5/79
ordinary plow depth.
7 . The rights of either party hereunder may be assigned in whole or
in part, and the provisions hereof shall extend to their heirs, successors
and assigns; but no change or division in ownership of the land, rentals
or royalties , however accomplished, shall operate to enlarge the obliga-
tions or diminish the rights of Lessee; and no change or division in such
ownership shall be binding on Lessee until thirty (30) days after Lessee
shall have been furnished by registered U. S. mail at Lessee ' s principal
place of business with a certified copy of recorded instrument or instru-
ments evidencing same. In the event of assignment hereof in whole or in
part, liability for breach of any obligation hereunder shall rest exclu-
sively upon the owner of this Lease or of a portion thereof who commits
such breach. In event of assignment of this Lease as to a segregated por-
tion of said Property, the rentals payable hereunder shall be apportion-
able as between the several leasehold owners ratably according to the sur-
face area of each, and default in rental payment by one shall not affect
the rights of other leasehold owners hereunder.
8. The breach by Lessee of any obligation arising hereunder shall not
work a forfeiture or termination of this Lease nor cause a termination or
reversion of the estate created hereby nor be grounds for cancellation
hereof in whole or in part. In the event Lessor considers that operations
are not at any time being conducted in compliance with this Lease, Lessor
shall notify Lessee in writing of the facts relied upon as constituting a
breach hereof, and Lessee, if in default, shall have sixty (60) days after
receipt of such notice in which to commence the compliance with the obli-
gations imposed by virtue of this instrument.
9. It is agreed that if this Lease covers a less interest in oil or
gas in all , or any part, of said Property than the entire and undivided fee
simple estate (whether Lessor' s interest is herein specified or not) or no
interest therein, then the royalties, delay rentals and other monies accru-
ing from any part as to which this Lease covers less than such full interest
shall be paid only in the proportion to which the interest therein, if any,
covered by this Lease bears to the whole and undivided fee simple estate
therein. All royalty interest covered by this Lease (whether or not owned
by Lessor) shall be paid out of the royalty herein provided. Failure of
Lessee to reduce rental paid hereunder shall not impair the right of Lessee
to reduce royalty.
10. Should Lessee be prevented from complying with any express or implied
covenant of this Lease, from conducting drilling or re-working operations
thereon or from producing oil or gas therefrom by reason of scarcity of or
inability to obtain or to use equipment or material, or by operation of
force majeure, any Federal or state law or any order, rule or regulation of
governmental authority, then while so prevented, Lessee ' s obligation to
comply with such covenant shall be suspended, and Lessee shall not be liable
in damages for failure to comply therewith; and this Lease shall be extend-
ed while and so long as Lessee is prevented by any such cause from conduct-
ing drilling or re-working operations on or from producing oil or gas from
the leased premises or land pooled with the leased premises; and the time
while Lessee is so prevented shall not be counted against Lessee, anything
in this Lease to the contrary notwithstanding.
11. Notwithstanding the other provisions of this Lease, it is distinct-
ly understood that Lessee shall not conduct any drilling operations or make
any installations or lay any pipeline on the leased Property until the lo-
cation of the well, installation of other equipment and any pipeline is
approved by the City of Wichita Falls and the drilling location, drilling
operations, installation and pipeline must meet the specifications design-
ed by the City of Wichita Falls to protect the water in the lake located
on the leased Property. Provided, however, Lessee does have the right to
directionally drill, produce and conduct operations and exercise all other
rights herein granted on the subsurface of the leased Property where the
surface location of such well is off of the leased Property and such opera-
tions shall be conducted in a manner to protect the water in the lake on
the leased Property. It is understood that the above provision, shall in
no way impair the pooling provisions herein.
12. Nothwithstanding the other provisions of this Lease , if, at the
end of the Primary Term, this Lease is being maintained by production of
Oil or gas on the leased Property or on land pooled with the leased Property
-4-
5/79
or is being maintained as otherwise herein provided, then at such time
thereafter as Lessee fails to commence an additional well each six (6)
months after the end of the Primary Term either on the leased Property or
on property pooled with the leased Property, then at such time all of the
leased Property shall revert to Lessor, save and except such part of the
leased Property as is included within producing pooled units or as to pro-
ducing wells on the leased Property as to such acreage as the Railroad
Commission of Texas allocates for the production of oil or gas for a pro-
ration unit on the leased Property, which, in no event, shall exceed
eighty (80) acres for an oil well and three hundred and twenty (320)
acres for a gas well.
13 . There is no warranty of title, either expressed or implied.
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be
executed this 1st day of June 11
CITY OF WICHITA FALLS , TEXAS
BY:
City Manager
ATTEST:
City Clerk
TUTHILL & BARBEE
BY:
-5-
F h�_'•it A ' to 0 1 1 and Gas Lease
from City of Wichita Falls to
Tuthill and Barbee
Those certain tracts of land situated in Archer County, Texas,
described as follows:
(1) All land owned by the City of Wichita Falls in
R. Carson Survey 173 , Abstract 107, Archer County,
Texas.
(2) All land owned by the City of Wichita Falls in
the East one-third (E 1/3) of the R. Carson
Survey 174, Abstract 108 , Archer County, Texas.
ASSURANCES
A. The State agrees to take necessary action within State capabilities to require
compliance with these assurances by the applicant or to assume responsibility
to the Federal government for any deficiencies not resolved to the satisfaction
of the Regional Director.
The Applicant Certifies:
B. That (to the best of his knowledge and belief) the disaster relief work described
on each Federal Disaster Assistance Administration (FDAA) Project Application
for which Federal financial assistance is requested is eligible in accordance
with the criteria contained in 24 Code of Federal Regulations, and FDAA (HUD)
Handbooks.
C. That it is the legal entity responsible under law for the performance of the work
detailed or accepts such responsibility.
D. That the emergency or disaster relief work therein described for which Federal
assistance is requested hereunder does not or will not duplicate benefits received
for the same loss from another source.
E. That all information given by it herein is, to the best of its knowledge and belief,
true and correct.
F. That all financial assistance received under this application will be, or has been,
expended in accordance with applicable law and regulations thereunder.
The Applicant Agrees:
G. To (1) provide without cost to the United States all lands, easements, and rights-
of-way necessary for accomplishment of the approved work; (2) hold and save the
United States free from damages due to the approved work or Federal funding.
H. To comply with Title VI of the Civil Rights Act of 1964 (PL 88-352) and all require-
ments imposed by the Federal Disaster Assistance Administration pursuant to that
Title to the end that, in accordance with Title VI of that Act and the Regulation, no
person in the United States shall, on the ground of race, color., religion, national-
ity, sex, age, or economic status, be excluded from participation in, be denied the
benefits of, or be otherwise subjected to discrimination under any program or ac-
tivity for which the Applicant received Federal financial assistance from the Agency
and HEREBY GIVES ASSURANCE THAT it will immediately take any measures nec-
essary to effectuate this agreement.
I. That if any real property or structure thereon is provided or improved with the aid
of Federal financial assistance extended to the Applicant by the Federal Disaster
Assistance Administration, this assurance shall obligate the Applicant, or in the
case of any transfer of such property, any transferee, for the period during which
the real property or structure is used for a purpose for which the Federal financial
assistance is extended or for any purpose involving the provision of similar ser-
vices or benefits. If any personal property is so provided, this assurance shall
obligate the Applicant for the period during which it retains ownership or possess-
ion of the property. In all other cases, this assurance shall obligate the Applicant
for the period during which the Federal financial assistance is extended to it by
FDAA.
J. That the assurance is given in consideration of and for the purpose of obtaining any
and all Federal grants, loans, reimbursements, advances, contracts, property,
discounts or other Federal financial assistance extended after the date hereof to the
Applicant by FDAA, that such Federal financial assistance will be extended in re-
liance on the representations and agreements made in this assurance and that the
CT R ijVIC;A'i'fo r:
f, W lma J. Thomas, duly appointed and City Clerk of the City of Wichita Falls,
Texas, do hereby certify that the above is a true and correct copy of a resolution
passed and approved by the Board of Aldermen of the City of Wichita Falls, Texas
on the day of June, 1979.
DATE:
City Clerk
(Official Position) (Signature)