BAYSHORE EXPLORATION L.L.C.
00000 XXXX XXXXXXX, XXXXX 000
XXXX, XXXXX 00000
Phone (000) 000-0000
Fax (000) 000-0000
xxxxxxxxxxxx@xxxxxxxxx.xxx
PARTICIPATION AGREEMENT
Bayshore Exploration L.L.C.
00000 Xxxx Xxxxxxx, Xxxxx 000
Xxxx, Xxxxx 00000
RE: XXXXXXXXXX NO. 1 WELL
XXXXX RANCH PROSPECT
LA SALLE COUNTY, TEXAS
Gentlemen:
I desire to apply for the purchase of a working interest in the Xxxxx
Ranch Prospect in La Salle County, Texas. I ("Participant") hereby acknowledge
that Bayshore Exploration L.L.C. ("Bayshore") will drill and put into
production, if warranted, a one-well prospect (Xxxxxxxxxx No. 1 Well) in the
Xxxxx Ranch Field Area for Xxxxxx and Escondido oil/gas production.
I hereby apply for the purchase of 3 point(s) at $6,400.00 per each
point (1.00% working interest) payable upon application, and tender herewith a
check in the amount of $19,200.00.
I hereby make the following representations, warranties and commitments:
INITIAL ONLY WHAT IS APPLICABLE:
a. By executing this Participation Agreement, I have committed myself to
become a (3.00%) working interest owner in this prospect.
b. The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of an investment in this oil prospect and of making an informed investment
decision.
DRILLING OPERATIONS: Upon acceptance of the same above recited consideration,
Bayshore, as operator, agrees to drill and test, and if warranted, complete and
equip one oil and/or gas well at a location of Bayshore's choice on the subject
leases, with the following terms and conditions:
1. Bayshore shall permit said test well with the Railroad Commission of
Texas, survey and stake the drilling location, build a necessary lease road,
prepare the location, cure title to the drillsite, contract with third party
contractors and drill with due diligence one test well to a total depth of 6,800
feet, or a depth sufficient to test the Escondido formation, log and test said
well for the purpose of establishing commercial oil/gas production or plugging
and abandoning same. Net revenue interest in the well is 73% before payout of
the test well and 70% after payout.
2. Xxxxxxxx agrees that, during drilling and completion operations,
Participant shall receive the following:
a. Daily drilling and completion reports on the subject well.
b. Copies of all logs, tests and samples gained from the drilling and
completion of the subject well.
c. Copies of all Railroad Commission of Texas filings on the subject
well.
3. In the event that an oil and/or gas well completion is attempted on the
subject test well, Participant agrees to pay its proportionate share of the
completion costs for the well per the Authority for Expenditure (AFE) which
equals $4,500.00 per each percentage point upon written and/or verbal
notification from Bayshore.
4. In the event that commercial oil and/or gas production is established on
the subject leases with said test well, then both Participant and Bayshore shall
enter into a mutually acceptable Joint Operating Agreement Model Form 610-1989
for the operation of the subject well. All subsequent operations and subsequent
xxxxx drilled and completed on the prospect acreage shall be governed by the
Joint Operating Agreement.
I recognize that an investment in oil exploration involves a high degree
of risk of loss of my entire investment. I have been advised to consult with my
own financial advisors regarding this investment. My commitments to all
investments bear a reasonable relationship to my net worth and I am able to bear
the risk of loss of my entire investment in this prospect.
In the event that a dispute arises between Participant and Bayshore or its
affiliates, or any of their respective successors, representatives, agents,
officers or employees, in connection with this offering, the offer and sale of
working interest, or this Participation Agreement, the parties hereto hereby
expressly agree that any such dispute shall be resolved through Arbitration
rather than litigation, and to submit the dispute to the American Arbitration
Association within 15 days after receiving a written request to do so. If any
party hereto fails to submit the dispute to Arbitration with in the specified
time above, the requesting party may then file any papers necessary to commence
arbitration. The parties hereto agree that any hearing scheduled after an
Arbitration proceeding is initiated, by either party, shall take place in
Houston, Xxxxxx County, Texas.
This Participation Agreement, and all of its terms and conditions,
represent the entire agreement between Participant and Bayshore pertaining to
the Xxxxx Ranch Prospect, and supersedes any and all prior agreements, written
or oral. Any changes to this agreement must be agreed to in writing by both
parties hereto.
AMOUNT OF WORKING INTEREST: Participant represents that he is delivering
herewith a check or certified funds in the amount of $6,400.00 per each point.
The total point(s) for which Participant is offering to purchase and the total
amount of the aforementioned check or certified funds are as follows:
Total Point(s) Desired: 3.00
Amount of Subscription: $19,200.00
**MAKE CHECK PAYABLE TO BAYSHORE EXPLORATION L.L.C.
IN WITNESS HEREOF, the undersigned has executed this Agreement on the date set
forth below:
________________________ /s/Xxxxxx Xxxxx
-----------------------
Xxxxxx Xxxxx
X.X. No./Federal I.D. No. Participant's Signature
00000 Xxxxx Xxxxx Place Dynamic Resources Corp.
Business Address - Street Participant's Name
Las Vegas, Nevada 89144 P.O. Box 370184
City, State & Zip Home Address
702/743-1343 Las Vegas, NV 89137
Business Telephone City, State & Zip
702/254-5594 000-000-0000
Fax Number Cell Telephone
xxxxxxxxxxx@xxxxxxxxxxxxxxxxxxxx.xxx
E-Mail Address
**Please note where and how you would like to receive your reports.
ACCEPTANCE
Bayshore Exploration L.L.C. xxxxxx accepts the offer represented by the
foregoing Participation Agreement, subject to the terms and conditions thereof.
AGREED AND ACCEPTED ON THIS 12th DAY OF MAY, 2005.
By: /s/ Xxxxx Xxxxxxxx
-------------------------
Xxxxx Xxxxxxxx, President
JJS:jrs
Exhibits "A"
