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CONVEYANCE, ASSIGNMENT AND BILL OF SALE
This Conveyance, Assignment and Bill of Sale (this "Conveyance is by and between
SHARBRO OIL LTD. CO., a New Mexico limited liability company, whose address is P. O.
Box 840, Artesia, New Mexico, 88211 -0840 (hereinafter referred to as "Sharbro Oil as
Assignor and the following assignees: LEGACY ROYALTY LLC, a New Mexico limited
liability company (hereinafter referred to as "Legacy YATES INDUSTRIES LLC, a Texas
limited liability company (hereinafter referred to as "Yates Industries SHARBRO
HOLDINGS LLC, a New Mexico limited liability company (hereinafter referred to as
"Holdings and SHARBRO ENERGY, LLC, a New Mexico limited liability company
(hereinafter referred to as "Energy Legacy and Yates Industries address is P.O. Box 1091,
Artesia, New Mexico 88211 -1091 and Holdings and Energy address is P.O. Box 840, Artesia,
New Mexico 88211 -0840. This Conveyance is entered into on the date set forth below, but
effective as of October 1, 2011 (the "Effective Date
WITNES SETH:
For ten dollars and other valuable consideration, the receipt and adequacy of which are
hereby acknowledged, Sharbro Oil hereby grants, sells, conveys, assigns, and transfers to the
following assignees the interests and estates set forth below, effective as of the Effective Date:
1. Fee Mineral Interests: To Legacy (25 and to Holdings (75 in the
percentages stated, all of Sharbro Oil's right, title, and interest in and to fee mineral
interests set forth on Exhibit "A," attached hereto (referred to as the "Mineral Interests
subject to presently existing oil and gas leases, rights -of -way, easements, restrictions, and
conditions of record, but specifically includes any and all rights to bonus, rentals, royalty,
and any other rights to receive money or proceeds attributable to such oil and gas leases
or other instruments affecting the Mineral Interests.
2. Oil and Gas Leasehold Estates, Operating Rights, and Overriding
Royalty Interests: To Energy (75 and to Yates Industries (25 in the percentages
stated, in and to all of Sharbro Oil's right, title, and interest in operating rights, oil and gas
leasehold estates, contractual rights, overriding royalty interests, production payment
interests, net profits interests, and any other interest held by Sharbro Oil (save and except
the Fee Interests set forth in Paragraph 1 above) (hereinafter referred to as the "Oil and
Gas Interests as set out on Exhibit "B," attached hereto and included herein for all
purposes.
Further, for the same consideration, Sharbro Oil does convey, transfer and assign
unto Energy and Yates Industries in the same undivided interests set forth in Paragraph 2
above, all of Sharbro Oil's right, title, and interest in and to the following, INSOFAR
AND ONLY INSOFAR as they relate to the Oil and Gas Interests:
(a) Sharbro Oil's leasehold interest in the oil, gas, and other mineral
leases described on Exhibit "B
(b) the wells, equipment, and facilities permanently located on the lands
described on Exhibit "B," including, but not limited to, pumps, surface and
subsurface well equipment, gas plants, saltwater disposal wells, lines and
facilities, sulfur recovery facilities, compressors, compressor stations,
dehydration facilities, treating facilities, gathering lines, flow lines, valves,
meters, separators, tanks, tank batteries, and other fixtures;
the oil, condensate, and natural gas liquids produced after the Effective
Date, including line fill below the pipeline connections as of the Effective
Date attributable to the leasehold interests described on Exhibit "B
RECEIVED 12/16/2011 at 10:15 AM
RECEIVING 962371
BOOK: 778 PAGE: 76
JEANNE WAGNER
LINCOLN COUNTY CLERK, KEMMERER, WY
00076
(d) all personal property, warehouse stock, and idle equipment pertaining to
the properties described on Exhibit "B
00077
(e) all contracts and agreements concerning the properties described on
Exhibit "B," including, but not limited to, unit agreements, pooling
agreements, areas of mutual interest agreements, farmout agreements,
farmin agreements, saltwater disposal agreements, water injection agrees,
water rights agreements, surface use agreements, line well injection
agreements, road use agreements, drilling contracts, seismic agreements,
operating agreements, well service contracts, production sales contracts,
gas contracts, gas balancing agreements, storage or warehouse
agreements, supplier contracts, service contracts, construction agreements,
division orders and transfer orders, insofar as and only insofar as they
relate to the interests and properties described on Exhibit "B" "Existing
Contracts);
(f)
(g)
authorizations, permits, and similar rights and interests applicable to, or
used in connection with, any or all of the interests and properties described
on Exhibit "B and
all files, compilations, reports, seismic data, logs, records, information and
data relating to the properties described on Exhibit "B," including, without
limitation: (i) land and title records (including abstracts of title, title
opinions, and title curative documents), (ii) contract files, (iii)
correspondence, (iv) operations, environmental, production, and
accounting records, (v) facility and well records, and (vi) geological,
geophysical, engineering, and other scientific and technical data and
information, including seismic lines, maps, and interpretations relating to
the properties described on Exhibit "B."
3. Surface Estates: To Energy (75 and to Yates Industries (25 in the
percentages stated, in and to all of Sharbro Oil's right, title, and interest in the surface
estates in real property (hereinafter referred to as the "Surface Interests in Chaves and
Eddy Counties in the State of New Mexico, specifically excepting and reserving all oil,
gas and other minerals therein, which reserved interests are conveyed in Paragraphs 1 and
2 above. For purposes of this Conveyance, Surface Interests includes all of Assignor's
right, title and interest in real property where (i) the mineral estate has been severed and
is owned by a third party or (ii) Assignor owns fee simple title to a full or undivided
interest in real property and the mineral estate has not been previously severed, but is
severed by virtue of this Conveyance in this paragraph, and is the fee simple estate of the
real property less and except (a) any previously reserved or conveyed mineral estate and
(b) the reserved (and conveyed in paragraph 1) mineral estate herein. The Surface
Interests are subject to all rights of way, easements, zoning, restrictive covenants and
restrictions of record.
4. Intent: By virtue of the grant of the interests set forth in Paragraphs 1
above, it is the intent of Sharbro Oil to convey to Legacy and Holdings, and Sharbro Oil
does hereby grant unto Legacy and Holdings, in the interests stated in Paragraph 1 above,
all of its right, title, and interest in fee mineral interests owned by it in the States of
Colorado, Montana, New Mexico, and Texas, and each county in such states as reflected
on Exhibit "A," even if Exhibit "A" improperly describes the lands or omits certain lands
in which Sharbro Oil owns a fee mineral interest.
It is Sharbro Oil's intent to convey to Energy and Yates Industries, and Sharbro
Oil does hereby grant unto Energy and Yates Industries, in the interests stated in
Paragraphs 2 and 3 above, all of its right, title, and interest in surface estates and in oil
and gas leases and oil and gas leasehold estates; operating rights; contractual interests
derived from joint operating agreements, farmout agreements, pooling or
communitization agreements, unit agreements; and any other agreement which creates a
Sharbro Oil conveys the above described interests with special warranty covenants, but
with full substitution and subrogation of Sharbro Oil, and all persons claiming by, through, or
under Sharbro Oil, to the extent assignable, in and to all covenants and warranties of Sharbro
Oil's predecessors in title and with full subrogation of all rights accruing under the applicable
statutes of limitation or prescription under the laws of the state where the assets are located and
all rights of actions of warranty against all former owners thereof.
WARRANTY DISCLAIMERS: ALL PERSONAL PROPERTY, MACHINERY,
FIXTURES, EQUIPMENT, AND MATERIALS CONVEYED HEREBY ARE SOLD AND
ASSIGNED AND ACCEPTED BY THE ASSIGNEES IN THEIR "WHERE IS, AS IS"
CONDITION, WITHOUT ANY WARRANTIES WHATSOEVER, EXPRESS OR IMPLIED
OR STATUTORY, OF MARKETABILITY, QUALITY, CONDITION,
MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE OR USE, ALL OF
WHICH ARE EXPRESSLY DISCLAIMED. THE PARTIES AGREE THAT TO THE
EXTENT REQUIRED TO BE OPERATIVE, THE DISCLAIMERS OF CERTAIN
WARRANTIES CONTAINED IN THIS SECTION ARE "CONSPICUOUS" DISCLAIMERS
FOR THE PURPOSE OF ANY APPLICABLE LAW.
This Conveyance shall bind and inure to the benefit of the above assignees and their
respective successors and assigns. This Conveyance may be signed in any number of
counterparts or with multiple signature pages and then reassembled into one or more
counterparts, each counterpart of which shall constitute an original. For recording purposes,
Exhibits A and B may be reduced to include only those properties located within a particular
state or county. A complete copy of this Conveyance will be maintained in the office of Sharbro
Energy LLC whose address is stated above.
2011.
right for Sharbro Oil to participate in, drill, develop, and produce oil, gas, and other
minerals; overriding royalty interests; production payment interests; net profits interests;
and any other burden on production which Sharbro Oil owns in the States of Colorado,
Montana, Nevada, New Mexico, Texas, Utah, and Wyoming, and the counties set forth
on Exhibit "B" hereto, save and except the Mineral Interests conveyed to Legacy and
Holdings in Paragraph 1 above, whether such interests are misdescribed or are omitted
from the descriptions in Exhibits "B."
Upon the execution and delivery of this Conveyance it is the intent of the parties
hereto that the assignees will collectively own all of the assets of Sharbro Oil. The
assignees will own the Sharbro Oil real property assets as to the respective estates and
interests as set forth in Paragraphs 1, 2 and 3 above.
IN WITNESS WHEREOF, this Conveyance is executed this e l r day of November,
ASSIGNOR:
SHARBRO OIL LTD. CO.
Cr
Sharon Snowden, Manager
00078
STATE OF NEW MEXICO
COUNTY OF EDDY
My Commission expires:
ASSIGNEES:
SHARBRO HOLDINGS LLC
SHARBRO ENERGY, LLC
s
Scott Yate. anager
YATES INDUSTRIES LLC
By:
Frank Yates,1'J., Man
LEGACY ROYALTY LLC
By:
ank ates �i` Manag
g
The foregoing instrument was acknowledged before me this f h day of November,
2011, by Sharon Snowden, as Manager of Sharbro Oil Ltd. Co., a New Mexico limited liability
company.
'11111 i
Notary Public
0)(
00079
STATE OF NEW MEXICO
ss.
COUNTY OF EDDY
The foregoing instrument was acknowledged before me this I d f day of November, 2011,
by Scott Yates as Manager of Sharbro Holdings LLC, a New Mexico limited liability company,
and as Manager of Sharbro Energy, LLC, a New Mexico limited liability company.
My Commission. expires:
ti 4�:lii'. �l' NEW t�liLSe�iv
STATE OF NEW MEXICO
ss.
COUNTY OF EDDY
The foregoing instrument was acknowledged before me this 1 4lay of November, 2011,
by Frank Yates, Jr., as Manager of Yates Industries LLC, a Texas limited liability company and
as Manager of Legacy Royalty LLC, a New Mexico limited liability company.
My Commission expires:
Lt i 1l J
o_ fv[ 1/1_t% /L
Notary Public
Notary Public
00080
Exhibit "A" to
Conveyance, Assignment and Bill of Sale
Fee Mineral Interests
All of the interest of Sharbro Oil Ltd. Co. of record in Mineral Interests* located in the
following:
I. State of Wyoming
Lincoln County
For purposes of this Conveyance, Mineral Interests includes all of Assignor's right, title and
interest in oil, gas and other minerals that have been severed from the surface estate by deed or
reservation with the right to enter the land to explore for, drill, produce, conduct operations,
sever, market and otherwise carry on mining or drilling activities, and the right to execute
mineral leases thereon, collect bonus, rents and royalty. Mineral Interests does not include oil
and gas leasehold estates arising under oil and gas leases, royalty interests, overriding royalty
interests, or other rights held by Assignor which are subject to and derived from an oil and gas
and /or mineral lease. If Assignor's Mineral Interest is subject to an existing oil and gas and/or
mineral lease, the rights conveyed herein include the right to receive all bonus, rents and royalty
that are owing after the Effective Date and accruing under the lease and upon expiration of the
existing lease, all of the interest shall revert to Legacy and Holdings in the interests stated.
00081
,111Vv 1111 U,11i111V11 JIJILII
EXHIBI
Exl 3" to
Conveyance, Assignment and Bill of Sale
f'Al t 1
10 /10/2011
Oil and Gas Leasehold Estates, Operating Rights, and Overriding Royalty Interests
All of the interest of Sharbro Oil Ltd. Co. of record in the Oil and Gas Interests* located in
the following county:
LEASE LEASE EXPIRED ACRES RNT
TWNS RNGE SEC DATE DATE GROSS NET STS
COUNTY /STATE WYOMING /LINCOLN
400 10539 W- 155502, YPC 5/01/2002 4/30/2012 PAY
20N 120W 13 ALL 640.00 640.00
RECORDING BOOK PAGE
RECORDING BOOK PAGE
DATE LEASE TOTALS: 640.00 640.00
400 10540 W- 155503, YPC 5/01/2002 4/30/2012 PAY
20N 120W 23 ALL 640.00 640.00
20N 120W 24 ALL 640.00 640.00
20N 120W 25 ALL 640.00 640.00
DATE LEASE TOTALS: 1920.00 1920.00
For purposes of this Conveyance, Oil and Gas Interests includes all of Assignor's right, title
and interest in operating rights, oil and gas leasehold estates, contractual rights, overriding
royalty interests, production payment interests, net profits interests, and any other interest in oil,
gas and all other minerals, save and except the Mineral Interests, as defined in this Conveyance
and Exhibit A. This also includes all rights of Assignor in equipment, personal property,
pipelines and rights of way associated with such Oil and Gas Interests. In the event Assignor
owns a fee Mineral Interest which is currently subject to an oil and gas and/or mineral lease and
Assignor is receiving royalty or other payments pursuant to such lease, the royalty interest or
other payments owing to Assignor in this instance is not a part of the Oil and Gas Interests
subject to this Exhibit B, but instead pass as part of the Mineral Interests in Exhibit A.
00082