Amendment No. 13 to Crude Oil Purchase Agreement between Texon L.P. and Presco Western LLC (Kansas Leases)

Summary

This amendment updates the crude oil purchase agreement between Texon L.P. (Buyer) and Presco Western LLC (Seller) for various Kansas oil leases. Effective December 1, 2008, it revises pricing terms, adds new leases, and clarifies delivery and payment procedures. The agreement sets the price based on NYMEX futures, with specific adjustments, and outlines monthly payment terms. Either party may cancel with 30 days' notice. The Seller is responsible for distributing payments to royalty owners and indemnifying the Buyer against related claims.

EX-10.7 13 a2192395zex-10_7.htm EXHIBIT 10.7
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Exhibit 10.7

December 23, 2008

Floyd Trujillo
Presco Western, LLC
5665 Flatiron Parkway
Boulder, CO 80301
  Re: Texon Contract No. CPE6866
Amendment No. 13
Customer Ref. No.
Various Kansas Leases—See Exhibit

        This Agreement shall serve to amend the above referenced contract and amendments thereto, if any, between Texon L.P. ("Buyer") and Presco Western LLC ("Seller"). The following Special Provisions reflect the original terms and are updated to include the item(s) amended herein and all prior amendments, if any. Items amended by this Agreement are described below. These updated Special Provisions and Texon L.P.'s General Provisions (Revision 3/08) constitute the entire Agreement between the parties.

ITEMS   PRICE: Amended pricing as described below effective December 1, 2008.

AMENDED

 

EXHIBIT "A": Added the Juanita 5-M29-32-39, the Franzland Co. 7-B and the Pheasant Valley leases, Morton, Seward and Finney County, Kansas effective December 1, 2008.
    EXHIBIT "A": Added all leases from Exhibits "B" and "C" effective December 1, 2008.

SPECIAL PROVISIONS

QUALITY

 

Kansas Common crude oil

QUANTITY

 

Equal to Seller's owned or controlled oil condensate production from the properties/leases described in the Exhibits attached hereto. Estimated to be 3,000 barrels per day. As additional wells are added to the contract, and the volume increases, we will adjust the volume accordingly.

PRICE

 

Each calendar month's arithmetic average of the settlement prices for the Nearby Light Sweet crude oil futures contract (WTI) on the New York Mercantile Exchange (NYMEX) for each day the NYMEX settles the Nearby WTI contract (Mere days only), plus or minus the NYMEX Roll (as defined below), less an adjustment of $4.37 per barrel.

 

 

NYMEX Roll: The arithmetic average of the daily settlement price for "Light Sweet Crude Oil" front month futures contract reported by the New York Mercantile Exchange (NYMEX) during the Physical Month of Delivery (the calendar month when the crude is delivered), excluding weekends and holidays, plus or minus the arithmetic average of the daily NYMEX settlement price for the prompt month, trading days only, when the Physical Month of Delivery is the prompt month trading on NYMEX, less the arithmetic average of the daily NYMEX settlement price for the second month during the same period, trading days only, multiplied by .6667, plus the average of the daily NYMEX settlement price for the prompt month, trading days only, when the Physical Month of Delivery is the prompt month trading on NYMEX, less the average of the daily NYMEX settlement price for the third month during the same period, trading days only, multiplied by .3333.

 

 

In the event that the transportation cost and/or tariff changes during the term of this Agreement, Buyer reserves the right to revise the contract accordingly.

DELIVERY

 

Delivered into Buyer designated carriers from the properties/leases described in the Exhibits attached hereto.


TERM

 

Effective November 1, 2008 through April 30, 2009 and continuing month to month thereafter unless either party cancels with thirty (30) days prior written notice. Cancellation shall become effective on the first day of the month following such notice period.

 

 

Buyer shall pay Seller or their designee 100% of the amount due for crude oil purchased hereunder, excluding all applicable taxes, by wire transfer on the 20th day of the month following the month of delivery. (See paragraph 3 of the General Provisions attached hereto.)

 

 

Buyer shall deduct from amounts due Seller all applicable taxes and shall remit such taxes on Seller's behalf when due. Seller or their designee shall make all revenue distribution payments to all royalty interest owners and any and all other persons who may have a right, title, interest, or claim to any part of the payments made by Buyer to Seller hereunder. SELLER AGREES TO PROTECT, INDEMNIFY AND HOLD BUYER HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, DAMAGES, LOSSES, COSTS, ATTORNEY'S FEES, EXPENSES OR LIABILITY OF ANY NATURE WHICH BUYER MAY SUFFER BY REASON OF BUYER MAKING PAYMENTS AS HEREIN PROVIDED.

 

Texon L.P.   Presco Wester, LLC

 

 

 

 

 

 

 

 

 

 

 
BY:   /s/ W.K. Jones

  DATE: 1/21/09   BY:   /s/ Floyd Trujillo
  DATE: 1/28/09
    W.K. Jones
Sr. Vice President, Crude Oil
          Floyd Trujillo    

EXHIBIT A

LEASE NAME
  FIELD   COUNTY   STATE   ADJUSTMENT  
GCC 1-530       Finney   KS     (4.370000 )
GCC 6-C30-23-33       Finney   KS     (4.370000 )
GCH 4-D36-26-32       Finney   KS     (4.370000 )
GCH 5-D36-26-32       Finney   KS     (4.370000 )
Irene 1-1632       Finney   KS     (4.370000 )
Jehle 1-1624       Finney   KS     (4.370000 )
JLM Farms 1-827       Finney   KS     (4.370000 )
JLM Farms 4-127-26-32       Finney   KS     (4.370000 )
Larson 1-731       Finney   KS     (4.370000 )
Pettz 1-531       Finney   KS     (4.370000 )
Pheasant Valley 33-23S-32W       Finney   KS     (4.370000 )
Ramsey 10-E28-23-32       Finney   KS     (4.370000 )
Webdell 3-3       Finney   KS     (4.370000 )
Barclay College 6-029-30-38       Grant   KS     (4.370000 )
Bunn 1       Grant   KS     (4.370000 )
Johnson 4-L       Grant   KS     (4.370000 )
Johnson Heirs 1       Grant   KS     (4.370000 )
Johnson Heirs 2       Grant   KS     (4.370000 )
Lucas Trust 4-K29-30-38       Grant   KS     (4.370000 )
Lucas Trust 5-M29-30-38       Grant   KS     (4.370000 )
Nave 6-B (Sec 18, T30, R38)       Grant   KS     (4.370000 )
Scherling W B 1-29       Grant   KS     (4.370000 )
Scherling W B 2-29       Grant   KS     (4.370000 )
Winter 13-M8-30-33       Grant   KS     (4.370000 )
Winter 14-N8-30-33       Grant   KS     (4.370000 )
Winter 15-M8.30-33       Grant   KS     (4.370000 )
Schartz Foods 4-K7-30-38   Wildcat   Grant   KS     (4.370000 )
Allen Trust No. 8       Haskell   KS     (4.370000 )
Allen Trust No. 9       Haskell   KS     (4.370000 )
Andrews Trust 9-C       Haskell   KS     (4.370000 )
Anton 2-518       Haskell   KS     (4.370000 )
Bergner 7-P17-28-34       Haskell   KS     (4.370000 )
Black Luciene A 9       Haskell   KS     (4.370000 )
Black Trusts 17-07-30-33       Haskell   KS     (4.370000 )
Black Trusts 18-P7-30-33       Haskell   KS     (4.370000 )
Black Trusts 20-D7-30-33       Haskell   KS     (4.370000 )
Black Trusts 21-G7-30-33       Haskell   KS     (4.370000 )
Black Trusts 23-E7-30-33       Haskell   KS     (4.370000 )
Bond 5L       Haskell   KS     (4.370000 )
Brennan 1       Haskell   KS     (4.370000 )
Brennan Gas Unit 2       Haskell   KS     (4.370000 )
Brookover EC 1A       Haskell   KS     (4.370000 )
Cox 1-162       Haskell   KS     (4.370000 )
Cox 1-8       Haskell   KS     (4.370000 )
Cox 6-P2-28-33       Haskell   KS     (4.370000 )
Davis 6-N17-30-32       Haskell   KS     (4.370000 )
Diaden Farms 1-B2-29-33       Haskell   KS     (4.370000 )
Diaden Farms 3-K15-30-32       Haskell   KS     (4.370000 )
Diaden Farms 4-J15-30-32       Haskell   KS     (4.370000 )
Diaden Farms 5-B15-30-32       Haskell   KS     (4.370000 )
E Hall 1-K16-30-32       Haskell   KS     (4.370000 )

LEASE NAME
  FIELD   COUNTY   STATE   ADJUSTMENT  
E Hall 5-N16-30-32       Haskell   KS     (4.370000 )
E Hall 6-P16-30-32       Haskell   KS     (4.370000 )
E Hall 8-M16-30-32       Haskell   KS     (4.370000 )
E Hall 9-C16-30-32       Haskell   KS     (4.370000 )
Earlene Black 1-817       Haskell   KS     (4.370000 )
Edna Cox 1-138       Haskell   KS     (4.370000 )
EE & L Stalker 1-1430       Haskell   KS     (4.370000 )
Eilerts 5-D17-30-32       Haskell   KS     (4.370000 )
Elliot 28-M (SWLVU P10)       Haskell   KS     (4.370000 )
Ellsaesser 1       Haskell   KS     (4.370000 )
Ellsaesser 2       Haskell   KS     (4.370000 )
Ellsaesser Gas Unit A 1       Haskell   KS     (4.370000 )
ELS Properties 1-1030       Haskell   KS     (4.370000 )
Eric Bradley 1-17       Haskell   KS     (4370000 )
Feight A 1-27       Haskell   KS     (4.370000 )
Feight A 4-27       Haskell   KS     (4.370000 )
FeightA 5 Lower       Haskell   KS     (4.370000 )
Feight A 5 Upper       Haskell   KS     (4.370000 )
Feight A 6 (SWDW)       Haskell   KS     (4.370000 )
Garner 1-1624       Haskell   KS     (4.370000 )
Garner 11-J24-30-34       Haskell   KS     (4.370000 )
Garner 12-124-30-34       Haskell   KS     (4.370000 )
Garner 22-H24-30-34       Haskell   KS     (4.370000 )
Grant Maurice 1-30       Haskell   KS     (4.370000 )
Hall SG1       Haskell   KS     (4.370000 )
Hall SG2       Haskell   KS     (4.370000 )
Hoffman 3-019-30-32       Haskell   KS     (4.370000 )
Hon 1-930       Haskell   KS     (4.370000 )
James Unit A A B 1       Haskell   KS     (4.370000 )
Kenneth 5-E 14-78-33(S14T28R33)       Haskell   KS     (4.370000 )
Kilgore 5-E33-29-39       Haskell   KS     (4.370000 )
Kilgore Trust 9-H       Haskell   KS     (4.370000 )
Koehn 5-F2-28-33       Haskell   KS     (4.370000 )
Lavelette 1-C12-27-33       Haskell   KS     (4.370000 )
LC Black 1-417       Haskell   KS     (4.370000 )
Luciene Black 10-17       Haskell   KS     (4.370000 )
McKinley 1-1519       Haskell   KS     (4.370000 )
McKinley 15-P19-30-33       Haskell   KS     (4.370000 )
McKinley 16-119-30-33       Haskell   KS     (4.370000 )
Megan Janae 1-30       Haskell   KS     (4.370000 )
Mertia Ammerman 1       Haskell   KS     (4.370000 )
Mertia Ammerman 2       Haskell   KS     (4.370000 )
Murphy 6-L27-29-32       Haskell   KS     (4.370000 )
Nanninga Trust 1-430       Haskell   KS     (4.370000 )
Nanninga Trust 34-E30-30-33       Haskell   KS     (4.370000 )
RB Garner 2       Haskell   KS     (4.370000 )
Riphahn 13-035-28-34       Haskell   KS     (4.370000 )
Roger Wilson 1-519       Haskell   KS     (4.370000 )
Schnellbacher A-4       Haskell   KS     (4.370000 )
Stalker 1-23 (Gas Unit)       Haskell   KS     (4.370000 )
Stalker 19-C       Haskell   KS     (4.370000 )
Stalker 33       Haskell   KS     (4.370000 )
Stalker 34-L30-30-33       Haskell   KS     (4.370000 )

LEASE NAME
  FIELD   COUNTY   STATE   ADJUSTMENT  
Stalker Eta! 28-130-30-33       Haskell   KS     (4.370000 )
Stalker Etal 29-030-30-33       Haskell   KS     (4.370000 )
Stalker Etal 30-K30-30-33       Haskell   KS     (4.370000 )
Stalker Etal 31-A30-30-33       Haskell   KS     (4.370000 )
Stalker Etal 32-H30-30-33       Haskell   KS     (4.370000 )
SWLVLU 112       Haskell   KS     (4.370000 )
SWLVLU 114       Haskell   KS     (4.370000 )
SWLVLU 117       Haskell   KS     (4.370000 )
SWLVLU 119       Haskell   KS     (4.370000 )
SWLVLU 121       Haskell   KS     (4.370000 )
SWLVLU 122       Haskell   KS     (4.370000 )
SWLVLU 123       Haskell   KS     (4.370000 )
SWLVLU P02       Haskell   KS     (4.370000 )
SWLVLU P03       Haskell   KS     (4.370000 )
SWLVLU P04       Haskell   KS     (4.370000 )
SWLVLU P07       Haskell   KS     (4.370000 )
SWLVLU P11       Haskell   KS     (4.370000 )
SWLVLU P12       Haskell   KS     (4.370000 )
SWLVLU P13       Haskell   KS     (4.370000 )
SWLVLU P14       Haskell   KS     (4.370000 )
SWLVLU P15       Haskell   KS     (4.370000 )
SWLVLU P18       Haskell   KS     (4.370000 )
SWLVLU P21       Haskell   KS     (4.370000 )
SWLVLU P22       Haskell   KS     (4.370000 )
SWLVLU P23       Haskell   KS     (4.370000 )
SWLVLU P24       Haskell   KS     (4.370000 )
Walter E. Preedy B1       Haskell   KS     (4.370000 )
Walter E. Preedy B3       Haskell   KS     (4.370000 )
Watkins 2-N17-30-32       Haskell   KS     (4.370000 )
Watkins Gas Un F-4       Haskell   KS     (4.370000 )
Wilson Gas Unit F3       Haskell   KS     (4.370000 )
Wilson-Dent Trust 27-F19-30-33       Haskell   KS     (4.370000 )
Wright B 28       Haskell   KS     (4.370000 )
Wright C Cl       Haskell   KS     (4.370000 )
Wright GU B1       Haskell   KS     (4.370000 )
Wyatt Trusts 9-N16-30-33       Haskell   KS     (4.370000 )
Anton 1-21   Victory   Haskell   KS     (4.370000 )
Black 22C (Sec 7, T30, R33W)   Victory   Haskell   KS     (4.370000 )
Marie 1-21   Victory   Haskell   KS     (4.370000 )
Poppe Trust 22-J17-30-33   Victory   Haskell   KS     (4.370000 )
SWLVLU 8   Victory   Haskell   KS     (4.370000 )
SWLVLU 9   Victory   Haskell   KS     (4.370000 )
Fletcher 7-J21-23-37       Kearny   KS     (4.370000 )
Kisel 1-1215-2       Kearny   KS     (4.370000 )
Miles 1-1128       Kearny   KS     (4.370000 )
BFC Warring Trust 2       Morton   KS     (4.370000 )
Blackwell Al       Morton   KS     (4.370000 )
BOWKER       Morton   KS     (4.370000 )
Bowker Gas Unit B1 1-2       Morton   KS     (4.370000 )
Dos Reatas 5-E26-32-40       Morton   KS     (4.370000 )
Dos Reatas 6-M26-32-40       Morton   KS     (4.370000 )
Green 4J S29-T32-R39       Morton   KS     (4.370000 )
Hull 5-G30-32-39       Morton   KS     (4.370000 )

LEASE NAME
  FIELD   COUNTY   STATE   ADJUSTMENT  
Johns 1-1324       Morton   KS     (4.370000 )
Juanita 5-M29-32-39       Morton   KS     (4.370000 )
Milbum 5-N28-31-39       Morton   KS     (4.370000 )
Osborne B-3       Morton   KS     (4.370000 )
Trahem 6-G20-31-39       Morton   KS     (4.370000 )
Becker Trust 5       Seward   KS     (4.370000 )
Becker Trust 6       Seward   KS     (4.370000 )
Chandler Carroll 1-19       Seward   KS     (4.370000 )
Franziand Co. 7-B 22-31S-33W       Seward   KS     (4.370000 )
Hatfield Eta! Unit 5-J22-31-33       Seward   KS     (4.370000 )
Lemert B H 1       Seward   KS     (4.370000 )
Wendy Marie 1-30       Seward   KS     (4.370000 )
Simpson Trust 5-J4-31-33   Victory   Seward   KS     (4.370000 )
Abbey Michelle 1-35       Stanton   KS     (4.370000 )
Amanda Jill 1-36       Stanton   KS     (4.370000 )
Amber Michelle 1-34       Stanton   KS     (4.370000 )
Andrea Frances 1-21       Stanton   KS     (4.370000 )
Andrea Lyn 1-9       Stanton   KS     (4.370000 )
Benjamin Lee (Sec 25, T29S, R40W)       Stanton   KS     (4.370000 )
Brian Daniel 1-34       Stanton   KS     (4.370000 )
Christopher Jared 1-8       Stanton   KS     (4.370000 )
Collingwood 1-28       Stanton   KS     (4.370000 )
Esser 2-16       Stanton   KS     (4.370000 )
Federal Land Bank 4-21       Stanton   KS     (4.370000 )
Federal Land Bank 5-21       Stanton   KS     (4.370000 )
Fell Gas Unit 4A       Stanton   KS     (4.370000 )
Garay 6-J21-29-39       Stanton   KS     (4.370000 )
Jay Morris 1-8       Stanton   KS     (4.370000 )
Kayla Marie 1-2       Stanton   KS     (4.370000 )
Kaylee Brooks 1-35       Stanton   KS     (4.370000 )
KU 6-120-29-39       Stanton   KS     (4.370000 )
KU 7-J20-29-39       Stanton   KS     (4.370000 )
KU 8-P20-29-39       Stanton   KS     (4.370000 )
KU 9-P20-29-39       Stanton   KS     (4.370000 )
Lynn Stacy 1-22       Stanton   KS     (4.370000 )
McPherson College 4-E21-29-39       Stanton   KS     (4.370000 )
McPherson College 5-F21-29-39       Stanton   KS     (4.370000 )
Mitchell Trust 5-E23-29-40       Stanton   KS     (4.370000 )
R & L Farms 1-28       Stanton   KS     (4.370000 )
Sarah Jane 1-34       Stanton   KS     (4.370000 )
Shonn Gregory 1-35       Stanton   KS     (4.370000 )
Trent David 1-23       Stanton   KS     (4.370000 )
Wade Allen 1-36       Stanton   KS     (4.370000 )
Western Feed Yard 1-1133       Stanton   KS     (4.370000 )
Western Feed Yard 2-1433       Stanton   KS     (4.370000 )
Williams 1-L21-29-39       Stanton   KS     (4.370000 )
Williams 2-L21-29-39       Stanton   KS     (4.370000 )
Williams 3-K21-29-39       Stanton   KS     (4.370000 )
Williams 4-L21-29-39       Stanton   KS     (4.370000 )
Wilson Unit 1       Stanton   KS     (4.370000 )
Yardley Frederick 1-25       Stanton   KS     (4.370000 )
Yashell Shirin 1-35       Stanton   KS     (4.370000 )
LTW Trust 12-E26-29-39   Big Bow   Stanton   KS     (4.370000 )

LEASE NAME
  FIELD   COUNTY   STATE   ADJUSTMENT  
Elliott Spencer 1   Liverpool Cemetery   Stanton   KS     (4.370000 )
Josline B-2       Stevens   KS     (4.370000 )
Swalar Al       Stevens   KS     (4.370000 )
Swalar B1       Stevens   KS     (4.370000 )



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    Exhibit 10.7