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Home My WebLink About919246 C00864 /¡Þ WHEN RECORDED, PLEASE RETIJRN TO: Zimmerman Resourcès Company P.O. Box 570174 Houston, Texas 77257-0174 Attn: Robert Zimmerman RECEIVED 6/12/2006 at 1 :53 PM RECEIVING #919246 BOOK: 622 PAGE: 864 JEANNE WAGNER LINCOLN COUNTY CLERK, KEMMERER, WY -----~~ STATE OF WYOMING ) ) , SS. COUNTY OF LINCOLN ) ASSIGNMENT OF OVERRIDING ROV AL tv INTEREST - ---- ---.--- THIS ASSIGNMENT OF OVERRIDING ROYALTY INTEREST (this "Assignment"), dated April 24, 2006, is from GARY-WILLIAMS PRODUCTION COMPANY, a Delaware corporation ("Assignor"), 370 Seventeenth Street, Suitè 5300, Denver, Colorado S0202, to ROBERT ZIMMERMAN, JR. doing business as ZIMMERMAN RESOURCES COMPANY ("Zimmerman"), P.O. Box 570174, Houston, Texas 77257-0174, and SARLAN RESOURCES INC. ("Sarlan"), 6052 South Lima Way, Englewood, Colorado SOl1l. Zimmerman and Sarlan shall be referred to herein, collectively, as "Assignee." Assignor and Assignee shall be referred to herein, collectively, as the "Parties." Recitals A. Assignor owns the entire oil and gas leasehold estates created by the leases (the "Leases") described in Exhibit A hereto, insofar as the Leases cover the land (the "Land") described in Exhibit A. .E. Assignor and Assignee desire Assignor to assign to Assignee an overriding royalty interest burdening the Leases in accordance with the terms and conditions hereof. PART I Assignment IN CONSIDERATION OF TEN DOLLARS ($10.00), and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows: ' 1.1 Assignment. Assignor hereby sells, assigns, transfers and conveys to Assignee an overriding royalty interest (the "Override") equal to three percent (3.00% of S/Sths) of all oil, gas and other hydrocarbons produced, saved and marketed from the Land described in Exhibit A hereto covered by the Leases described in Exhibit A hereto; provided, however, that the Override shall be reduced, on a lease-by-Iease basis, to the extent that the Override burdening a Lease exceeds the difference between a 15.50% and the sum of all landowners' royalties and overriding royalties burdening such Lease which are recorded in the real property records on or before the date of this Assignment (excluding any such overriding royalties owned by Assignor or any of Assignor's affiliates), but in no event shall the Override be less than one percent (1.00% of SiSths). The Override shall be owned by Zimmerman and Sarlan one-half each. 091.9246 C00865 1.2 Warranty. Assignor warrants title to the Override against all liens, encumbrances , and defects of title arising by, through or under Assignor, but not otherwise. EXCEPT FOR THE FOREGOING, TIllS ASSIGNMENT IS "AS IS, WHERE IS, WITH ALL FAULTS AND WITHOUT RECOURSE." THE PARTIES HEREBY EXPRESSLY DISCLAIM ALL WARRANTIES, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTY OF MERCHANTABILITY AND FITNESS FORA PARTICULAR PURPOSE. 1.3 Payment. The Override shall be free and clear of aIi costs of drilling, development and operatións. The Override shall not be paid or accrued on oil, gas or other hydrocarbons unavoidably lost, or used at the property for operations, development or production purposes including, without limitation, repressuring or recycling operations or pressure maintenance, until such time that said hydrocarbons are produced and marketed. In addition, the Override shall bear its proportionate share of costs for transportation, taxes, gas gathering and processing to the same extent that such costs are deductible from the lessor's royalty interest under the Leases under applicable laws and regulations. 1.4 Proportionate Reduction. The Override shall be proportionately reduced on a lease-by-lease basis to the extent a Lease covers less than the entire undivided oil and gas mineral fee estate in and under the Land covered by such Lease, and to the extent that the interest in a Lease owned by Assignor as of the date of this Assignment is less than the entire oil and gas leasehold estate created by such Lease. 1.5 Extensions and Renewals. The Override shall burden all extensions and renewals of the Leases acquired by Assignor, or Assignor's successors or assigns. For purposes of this Assignment, an "extension or renewal" shall mean any amendment, extension, renewal or new lease covering the Land covered by an expiring Lease which is acquired (and, with respect to a federal or state lease, for which an offer to lease has been filed) by Assignor or Assignee, or Assignor's or Assignee's successors or assigns, on or before the expiration of such Lease or on or before one year thereafter. TO HAVE AND TO HOLD the Override, subject to the terms and conditions hereof, unto AssIgnee, and Assignee' successors and assigns, forever. PART II Miscellaneous 2.1 Exhibits. All exhibits attached hereto are hereby incorporated herein and made a part hereof for all purposes, as if set forth in full herein. References in such exhibits to instruments on file in the public records are hereby incorporated by reference herein for all purposes. 2.2 Headings.' Headings are included in this Assignment for convenience of reference and shall in no way defme, limit, extend, or describe the 'scope or intent of any provision of this Assignment. Page 2 I :J~i~~~~~¡m:! ."'j 091.9246 C00866 2.3 Severability. In the event any court invalidates any provision of this Assignment, all other provisions shall remain binding and in full force and effect with respect to the Parties. 2.4 Third Party Rights. The references in this Assignment or in the exhibits hereto to liens, encumbrances, agreements and other burdens shall not be deemed to recognize or create any rights in third parties. 2.5 No Merger. The Parties hereby acknowledge and agree that the Override shall not be deemed to merge with any leasehold interests now owned or hereafter acquired by any of the Parties. 2.6 Successors and Assigns. This Assignment shall be binding upon and inure to the benefit of Assignor and Assignee, and their respective heirs, devisees, personal representatives, successors and assigns. 2.7 Further Assurances. Assignor agrees to take all such action and to execute, acknowledge and deliver all such instruments necessary or advisable to consummate the transactions contemplated by this Assignment. Assignor agrees to execute, acknowledge, and deliver to Assignee all such other additional instruments, notices, division orders, transfer orders, and other documents, and to do all such other and further acts and things as may be necessary or useful' to more fully and effectively transfer, convey, and assign to Assignee the Override conveyed hereby or intended so to be. 2.8 Governmental Assignments. Separate assignments of the Override may be executed on officially approved forms by Assignor to Assignee in sufficient counterparts to satisfy applicable statutory and regulatory requirements. Those assignments shall be deemed to contain all of the agreements, rights,' titles, disclaimers, limitations, powers and privileges set forth herein as fully as though they were set forth in each such assignment. The interests conveyed by such separate assignments are the same, and not in addition to, the Override conveyed herein. 2.9 Counterparts. This Assignment may be executed in one or, more counterparts, each of which shall be deemed to be an original, but all of which shall be deemed to be one assignment. " Page 3 O~1.S246 C00867 EXECUTED on the date first above written, to be effective for all purposes as of the Effective Date. ASSIGNOR: GARY· WILLIAMS PRODUCTION COMPANY By:¡::;::; +---/ Name:IT"""- ~ Title: Jj,c..£í: (,,/{ Acknowledgment , STATE OF COLORADO } }ss. COUNTY OF DENVER } The fo»,goin¡;i¡>~en! was a~~dged before me this ø1!ß¡..y of /J.., . "t , 2006, bY~Á ....~.JßMd , as President of Gary-Williams P~ Company, a Delaware corporation, on behalf of said corporation. 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