Stephen R. and Mary K. Herbel - Page 14

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                       Nothing contained herein is intended to                        
                  diminish Buyer's rights under the provisions of                     
                  Paragraph (K) of the General Terms and Conditions                   
                  of the Contract, it being specifically understood                   
                  that the said provisions shall be applicable to                     
                  the Prepayment and, accordingly, that Seller                        
                  shall bear the economic burdens, if any, of and                     
                  shall pay all royalties, overriding royalties,                      
                  production payments, taxes and other payments and                   
                  settlements of whatsoever kind and nature due in                    
                  respect of production prepaid for herein.  Seller                   
                  further agrees to indemnify Buyer and save it                       
                  harmless from all claims, suits, actions, debts,                    
                  accounts, damages, costs, losses, attorneys' fees                   
                  and expenses arising out of adverse claims of any                   
                  and all persons or entities to or against said                      
                  production and said Prepayment.                                     
                  5.                                                                  
                       In addition to the warranty provided for in                    
                  Paragraph (K) of the General Terms and Conditions                   
                  Supplement to the Contract, Seller hereby repre-                    
                  sents, warrants and guarantees that it is the                       
                  owner of the Gross Working Interest stipulated in                   
                  Exhibit E and has the right to sell and deliver                     
                  to Buyer that share of gas produced represented                     
                  by such Gross Working Interest without the                          
                  joinder of any other person whomsoever.  Seller                     
                  further represents, warrants and guarantees that                    
                  it is the owner of all rights and claims                            
                  attributable to the said Gross Working Interest                     
                  arising out of the Quantities provisions of the                     
                  Contract for all periods commencing after the                       
                  Effective Date of the Contract.  It is                              
                  acknowledged that the amount of the Prepayment                      
                  is predicated upon the foregoing representations.                   
                  Seller further represents, warrants and guaran-                     
                  tees that there exist no encumbrances or other                      
                  rights superior to the rights of Buyer to recoup                    
                  the said Prepayment.  Seller agrees and covenants                   
                  that until such time as Buyer has fully recouped                    
                  the Prepayment, it shall not assign, transfer or                    
                  otherwise encumber its interests in the Subject                     
                  Well, in whole or in part, without the prior                        
                  written consent of Buyer, which consent shall not                   
                  be unreasonably withheld.  No such transfer,                        
                  however, shall relieve Seller of its obligations                    
                  to Buyer hereunder.                                                 






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Last modified: May 25, 2011