EXHIBIT 10.1
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ASSIGNMENT AND XXXX OF SALE
This Assignment and Xxxx of Sale is made and entered into this ____ day
of December, 2006 (the "Effective Date"), by and between TRANS ENERGY, INC., a
Nevada corporation, having an address of 000 0xx Xxxxxx, Post Xxxxxx Xxx 000,
Xx. Xxxxx, Xxxx Xxxxxxxx 00000 ("Assignor"), and XXXXXXXXXXX, INC., a
Pennsylvania corporation, having an address of 0000 Xxxxxxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxxxxxx 00000 ("Assignee").
WHEREAS, Assignor is the present owner of six (6) oil and/or gas xxxxx
lying, being and situate in Mannington District, Xxxxxx County, West Virginia,
being more particularly described and designated as follows (the "Assigned
Xxxxx"):
Name API No.
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O. N. Koen No. 1 47-049-01022
Xxxxxxx No. 1 47-049-01024 Xxxxx
Xxxxx Xx. 0 Xx XXX # (Xxxxxxx)
Xxxxx Xxxxx No. 1 47-049-00064 (Plugged)
Xxxxx Xxxxx No. 2 47-049-00124
X. X. Xxxxxx No. 2 47-049-01023
WHEREAS, Assignor acquired the Assigned Xxxxx by virtue of that certain
Assignment and Xxxx of Sale from Xxxxxx Xxxxxxx, Trustee of Texas Energy Trust
Company, BOK Operating, and Prima Oil Company, Inc., as assignors, to Trans
Energy, Inc., as assignee, dated August 14, 2006 and of record in the Office of
the Clerk of the County Commission of Xxxxxx County, West Virginia in Assignment
Book 30, page 165;
WHEREAS, the Assigned Xxxxx are located upon, within and under those
certain oil and gas leases covering property in Mannington District, Xxxxxx
County, West Virginia, and being particularly described and set forth as follows
(collectively, the "Leases"):
a. Lease between O. N. Koen, et al., as lessors, and X.
X. Xxxxxx, as lessee, dated August 1, 1925 and of
record in the Office of the Clerk of the County
Commission in Xxxxxx County, West Virginia in Deed
Book 270, page 583;
b. Lease between Xxxxxx X. Xxxxxxx, Executor of the Will
of Zimary Xxxxxxx, et al., as lessors, and Xxxxxx X.
Xxxxxx, as lessee, dated April 1, 1928 and of record
in the aforesaid Clerk's Office in Deed Book 296,
page 64;
c. Oil and Gas Lease and Assignment between X. X.
Xxxxxxx, et al., as lessors, and X. X. Xxxxxxxx, as
lessee, dated September 1, 1926 and of record in the
aforesaid Clerk's Office in Deed Book 287, page 39;
and
d. Lease between Xxxxxxx X. Xxxxx, et al., as lessors,
and X. X. Xxxxxx, as lessee, dated July 15, 1936 and
of record in the aforesaid Clerk's Office in Deed
Book 327, page 161.
WHEREAS, Assignee desires to obtain ownership and control of the
Assigned Xxxxx in order to either produce and/or plug and abandon the Assigned
Xxxxx, and Assignor has agreed to assign and convey to Assignee all of
Assignor's right, title and interest in and to the Assigned Xxxxx for said
purposes including, but not limited to, the well bores, casing, rods, valves,
well head fittings and other appurtenant well equipment and well fixtures, if
any, together with any and all appurtenances thereto including, without
limitation, an absolute, non-exclusive easement or right of way across the lands
of the Assignor for the purposes of ingress, egress and regress to and from the
Assigned Xxxxx.
NOW, THEREFORE, in consideration of Ten and no/100 ($10.00) Dollars in
hand paid, together with other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties agree as follows:
1. Conveyance and Assignment.
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(a) Assignor does hereby sell, assign, transfer, set over,
grant and convey to Assignee all of Assignor's right, record title, operating
rights and interest in and to:
(i) All of Assignor's undivided right, title and
interest in and to the Assigned Xxxxx including, without limitation, the
absolute right to produce, operate, maintain, repair, replace, abandon and plug
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said Assigned Xxxxx, together with the well bores, casing, rods, valves, well
head fittings, gathering and distribution pipelines and other fixtures connected
to or associated with the Assigned Xxxxx, and other appurtenant well equipment
and well fixtures located thereon.
(ii) To the extent Assignor may lawfully assign and
convey the same and to the extent relating directly and exclusively to the
Assigned Xxxxx, all of Assignor's undivided interest in and to all documents,
contracts and agreements relating to the Assigned Xxxxx.
(iii) All of Assignor's undivided interest in and to
all of the real, personal and mixed property (including well bores, casing,
rods, valves, well head fittings and other appurtenant well equipment and well
fixtures located thereon) and all other fixtures and improvements appurtenant to
the Assigned Xxxxx or used in connection therewith.
(iv) All of Assignor's interest in all operating
rights, permits, franchises, easements, rights-of-way, surface rights, contract
rights under warranties made by prior owners of the Assigned Xxxxx,
manufactures, vendors and other third parties, rights accruing under applicable
statues of limitations and other rights, estates and hereditaments incident or
relating to the Assigned Xxxxx.
(b) Items (i) through (iv) above are collectively
referred to herein as the "Property").
2. Fixtures. At any time after the Effective Date, Assignee shall
have the right to utilize or remove or otherwise affect any gathering and
distribution pipelines and other fixtures connected to or associated with the
Assigned Xxxxx to the extent that Assignee deems such activity to be necessary
to accomplish the operating or plugging of the Assigned Well.
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3. Representations and Warranties of Assignor. Assignor hereby
represents to Assignee, its successors and assigns, that as of the Effective
Date:
(a) Assignor is the current owner of the Assigned Xxxxx and
has the absolute right to abandon and plug the Assigned Xxxxx, and is currently
owns and possesses the lessee's interest in and under the Leases, free and clear
of any liens and encumbrances other than those monetary liens and encumbrances
being satisfied at closing; provided, however, that Assignee hereby acknowledges
and agrees that the lien evidenced by that Deed of Trust, Security Agreement,
Financing Statement and Assignment of Production from Energy Capital Resources,
Inc. to Xxxxxx Xxxxxxxx and Xxxxxx X. Xxxxxxxx, Trustees, dated April 17, 1991
and of record in the Office of the Clerk of the County Commission in Xxxxxx
County, West Virginia in Trust Deed Book 574, page 642, securing Opman Holding
Limited, in the original principal amount of (pound)500,000 pounds sterling,
said Deed of Trust, Security Agreement, Financing Statement and Assignment of
Production having been assigned by Opman Holding Limited unto Emerald Energy Plc
by Assignment from Opman Holding Limited to Emerald Energy Plc by Assignment
dated May 31, 1994 and of record in the aforesaid Clerk's Office in Assignment
Book 15, at page 197, will not be satisfied or released at closing; and,
(b) Assignor is the owner and party in possession of all
easements and right of ways appurtenant to the Leases; and,
(d) To Assignor's knowledge, the payments of the rentals,
royalties and all other monetary obligations contained in or required by the
Leases are current and complete; and,
(e) The Leases are currently in full force and effect and the
Assignor has the right to transfer the Assigned Xxxxx unto Assignee; and,
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(f) No lawsuit, action or other proceeding is pending, or to
Assignor's knowledge threatened, before any court, arbitration panel or
governmental agency that relates to the Assigned Xxxxx or the Leases and based
upon omissions, events or occurrences prior to the Effective Date.
(g) No third party consent or approval is required for
Assignor's execution of this Assignment and transfer of the Assigned Xxxxx;
(h) There are no violations pending or threatened in
connection with any of the Assigned Xxxxx or the Leases, and the same are in
full compliance with all applicable laws, rules, regulations, injunctions,
decrees and orders including, but not limited to, laws, rules, regulations,
decrees, and orders of the Office of Oil and Gas of the Division of
Environmental Protection of the State of West Virginia and of the Environmental
Protection Agency of the United States of America.
(i) Assignor is a corporation duly incorporated and validly
existing under the laws of the State of Nevada, which is qualified to do
business and in good standing under the laws of the State of West Virginia and
every other jurisdiction in which it operates, and which has full power and
authority to enter into and perform this Assignment according to its terms.
(j) Assignor has full right and has obtained all requisite
authority to enter into this Assignment, which is enforceable according to its
terms.
(k) This Assignment does not violate or conflict with any
agreement, law, rule, regulation charter or instrument governing Assignor's
organization, management or business affairs including, without limitation, its
Articles of Incorporation or Bylaws.
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4. Covenants of Assignor. Prior to the Effective Date, Assignor
covenants and agrees to:
(a) endeavor in good faith (subject to emergency situations
which may occur) to keep the Leases in full force and effect by performing all
express covenants and duties and to operate in a diligent fashion in
substantially the same manner as it has heretofore, under and pursuant to the
subject Leases, including but not limited to the payment of all rentals and
royalties, the supplying of all free gas, if applicable, continuing the
production of the Assigned Xxxxx, and carrying out all other reasonable and
practical duties pertaining to the Assigned Xxxxx; and,
(b) repair, maintain and operate the Assigned Xxxxx in a
diligent fashion in substantially the same manner as it has heretofore; and, (c)
do such other and further acts, and execute, and re-execute such other or
further instruments, documents, and other writings necessary or convenient to
effect the transfer contemplated hereby; and,
(d) be solely responsible for and pay all taxes and royalties
for the period prior to the date of this Assignment.
5. Assumption. As of the Effective Date, Assignee shall assume all
obligations and liabilities relating to the ownership and operation of the
Property, including, but not limited to, the following obligations or
responsibilities:
(a) to plug and abandon and remove and dispose of the Assigned
Xxxxx and the other equipment now or hereafter related thereto; and,
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(b) to dispose of all pollutants, wastes, materials or
substances now or hereafter situated on or near the Assigned Xxxxx; and,
(c) to assume all other costs, obligations and liabilities
that relate to the Assigned Xxxxx and that arise from or relate to events
occurring or conditions existing on or after the Effective Date; and,
(d) to any and all royalty payments due or which may become
due under the Leases; and,
(e) to administer any and all free gas users that may be
connected to the Assigned Xxxxx and to notify any of the said free gas users of
any intended plugging activity of the Assigned Xxxxx sufficiently in advance of
such activity; and,
(f) to produce and operate the Assigned Xxxxx pursuant to the
terms and conditions of the Leases; and,
(g) to comply with any federal, state, or local laws, rules,
orders and regulations applicable to any waste material or hazardous substances
on or included with any of the Assigned Xxxxx or to the presence, disposal,
release or threatened release of waste material or hazardous substance from the
Assigned Xxxxx into the atmosphere or into or upon land or any water course or
body of water including ground water; and,
(h) to undertake any voluntary environmental response action
undertaken pursuant to the Comprehensive Environmental Response Compensation and
Liability Act (CERCLA) or any other federal, state or local environmental law.
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6. Purchase Price. Upon receipt of a fully executed original of this
Assignment, Assignee will pay to the order of Assignor, in cash, certified check
or other immediately available funds, the sum of Six Hundred Sixty-Seven
Thousand Dollars and No Cents ($667,000.00) (the "Purchase Price").
7. Condition of the Property. Assignee hereby accepts the Property
solely on the basis of its own investigation of the physical condition of the
Property including, without limitation, surface and subsurface condition; and
Assignee accepts all of the same in their "as is, where is" condition with all
faults; all equipment and other personal property forming any part of the
Property is hereby transferred subject to normal wear and tear and without
warranties of any kind whatsoever, whether expressed or implied, and are sold
"as is and with all faults and defects" and "with no warranty as to
merchantability, fitness or suitability for any particular purpose."
8. Right to Drill New Oil and Gas Xxxxx.
(a) For a period of one year after the Effective Date,
Assignor shall have the right to permit and drill one or more oil and gas xxxxx
located on the Xxxxx Xxxxx Lease (Deed Book 327, page 161) and the X. X. Xxxxxx
Lease (Deed Book 296, page 64) in the location(s) previously approved by
Assignee, such locations being more particularly identified as within the green
cross-hatched area set forth on Exhibit A attached hereto and incorporated
herein by this reference.
(b) In addition, Assignor, at Assignor's sole cost and
expense, shall be permitted to spud a new Gob Well on the aforementioned Xxxxx
Xxxxx Lease and the X. X. Xxxxxx Lease so long as (i) such Gob Well is located
behind the then-current mine panel, (iii) the mine-through by Consol Energy
Inc., a Delaware corporation, or any of its subsidiaries, or their respective
successors and assigns (collectively, "Consol"), has been completed for a period
of at least six (6) months (such that subsidence is deemed to be completed), and
(iii) such Gob Well will not interfere with or adversely impact Consol's future
coal mining operations or result in Consol sustaining or incurring any
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significant financial cost or expense. Notwithstanding any of the foregoing, in
no event shall Assignor be held responsible for, or incur any liability or
obligation whatsoever related to, any governmental agency's objection or
prohibition to the spudding of a new Gob Well.
(c) As used herein, the term "Gob" shall mean the de-stressed
zone associated with any full seam extraction of coal that extends above and
below the mined out coal seam, and may be sealed or unsealed and the term "Gob
Well" shall mean any oil and gas well drilled after mining for the purpose of
extracting oil and/or gas from the Gob.
9. Binding Effect. Further, the terms, covenants, and conditions hereof
shall be binding upon and shall inure to the benefit of the Assignor and the
Assignee and their respective successors and assigns, and such terms, covenants,
and conditions are effective as stated, shall be covenants running with the
lands and the leasehold estates herein assigned and with each transfer or
assignment of said lands and leasehold estates, whether or not the terms,
covenants, and conditions are memorialized in future assignments or other
instruments.
10. Compliance with Laws. Assignee will comply with all rules, laws,
regulations and statutes applicable to Assignee's ownership and operations of
the Property.
11. Counterparts. This Assignment may be executed in any number of
counterparts and each counterpart shall be deemed to be an original instrument,
but all counterparts shall constitute but one Assignment.
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TO HAVE AND TO HOLD the Property unto Assignee, its successors and
assigns, subject to the terms, covenants, and conditions hereinabove set forth.
IN WITNESS WHEREOF, the Assignor has executed this Assignment effective
as of the Effective Date above written, intending to be legally bound hereby.
ASSIGNOR:
TRANS ENERGY, INC.,
a Nevada corporation
By: _____________________________
Name: _____________________________
Title: _____________________________
STATE OF WEST VIRGINIA )
) SS:
COUNTY OF ____________________________ )
On this ____ day of December, 2006, before me, the undersigned
officer, personally appeared ____________________________, the
________________of TRANS ENERGY, INC., a Nevada corporation, acting in his or
her capacity as such officer, and being authorized to do so, executed the
foregoing instrument on behalf of said corporation.
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Notary Public
My commission expires: ___________________.
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IN WITNESS WHEREOF, the Assignee has executed this Assignment effective
as of the Effective Date above written, intending to be legally bound hereby.
ASSIGNEE:
XXXXXXXXXXX, INC.,
Pennsylvania corporation
By: ___________________________
Name: ___________________________
Title: ___________________________
COMMONWEALTH OF PENNSYLVANIA )
) SS:
COUNTY OF ALLEGHENY )
On this ____ day of December, 2006, before me, the undersigned
officer, personally appeared _____________________________, the ______________of
XXXXXXXXXXX, INC., a Pennsylvania corporation, acting in his or her capacity as
such officer, and being authorized to do so, executed the foregoing instrument
on behalf of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and official
seal.
My commission expires: ___________________.
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Notary Public
This document prepared by:
Xxxxxx X. Xxxxxxxx, Esq.
Xxxxxx Xxxx XxXxxxx Xxxxx & Love PLLC
0000 Xxxxxxx Xxxxxx, Xxxxx X
Xxxxxxxxxx, XX 00000-0000
(000) 000-0000
RWD/csw
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