Document:

Exhibit 10.1

 

 

 

PRESS
RELEASE

 

Magic
Reports First Quarter 2014 Results with Revenues Increasing 23% Year over Year to $40.9 Million, and Net Income Increasing
28% Year over Year to $4.5 Million

 

Non-GAAP
operating income increased 23% year over year to $6.4 million

 

Or
Yehuda, Israel, May 7, 2014 – Magic Software Enterprises Ltd. (NASDAQ
and TASE: MGIC), a global provider of mobile and
cloud-enabled application and business integration
platforms, announced today its financial
results for the quarter ended March 31, 2014.

 

Financial
Highlights for the First Quarter Ended March 31, 2014

 

		•	Revenues
                                         for the first quarter increased 23% year over year to $40.9 million from $33.4 million
                                         in the same period last year.

 

		•	Operating
                                         income for the first quarter increased 28% to $6.0 million, compared to $4.6 million
                                         in the same period last year; Non-GAAP operating income for the first quarter increased
                                         23% to $6.4 million, compared to $5.2 million in the same period last year.

 

		•	Net
                                         income for the first quarter increased 28% to $4.5 million compared to $3.5 million
                                         in the same period last year; Non-GAAP net income for the first quarter increased 17%
                                         to $5.0 million, compared to $4.2 million in the same period last year.

 

		•	Operating cash flow for the quarter amounted to $4.5 million.

 

		•	During
                                         the first quarter, we successfully raised net proceeds of approximately $54.7 million
                                         in a public offering. As of March 31, 2014 our total cash, cash equivalents and
                                         short-term investments amounted to $87.9 million.

 

Comments
of Management

 

Guy
Bernstein, Chief Executive Officer of Magic Software Enterprises, said, “I am very
pleased to report another excellent quarter with strong performance across our products and professional services in all regions.
Our revenue streams are growing in line with Magic’s strategic development goals."

 

“This
strong start to 2014 along with the additional capital from our recent public offering puts us on track to continue
to create and deliver long-term shareholder value. We are confident in our growth strategy and are establishing revenue guidance
in the range of $161 million to $165 million for the full-year 2014,” added Bernstein.

 

    	 

    	 

    

 

Conference
Call Details

 

Magic’s
Management will host an interactive conference today, May 7, at 10:00am Eastern Time (7:00am Pacific Time, 17:00 Israel Time).
On the call, management will review and discuss the results, and will also be available to answer investors’ questions.

 

To
participate, please call one of the following teleconferencing numbers. Please begin placing your calls at least 10 minutes before
the conference call commences. If you are unable to connect using the toll-free numbers, call the international dial-in number.

 

NORTH
AMERICA: 1.888.407.2553

 

UK:
0 800 917 5108

 

ISRAEL:
03 918 0610

 

INTERNATIONAL:
+972 3 918 0610

 

For
those unable to listen to the live call, a replay of the call will be available for three months from the day after the call under
the investor relations section of Magic’s website.

 

Non-GAAP
Financial Measures

 

This
release includes non-GAAP operating income, net income, basic and diluted earnings per share and other non-GAAP financial measures.
These non-GAAP measures exclude the following items:

 

		•	Amortization
                                         of purchased intangible assets;

 

		•	In-process
                                         research and development capitalization and amortization;

 

		•	Equity-based
                                         compensation expense;

 

		•	Change
                                         in valuation of contingent consideration; and

 

		•	The
                                         related tax effects of the above items.

 

Summary
of Non-GAAP Financial Information

 

U.S.
Dollars in thousands, except per share amounts 

 

	 	 	Three months
    ended	 
	 	 	March 31,	 
	 	 	2014	 	 	2013	 
	 	 	Unaudited	 
	Non-GAAP	 	 	 	 	 	 		 
	Revenues	 	$	40,949	 	 	$	33,414	 
	Gross profit	 	 	23,260	 	 	 	18,875	 
	Operating income	 	 	6,408	 	 	 	5,231	 
	Net income attributable
    to Magic Software shareholders	 	 	4,962	 	 	 	4,240	 
	Basic earnings per share	 	 	0.13	 	 	 	0.12	 
	Diluted earnings per share	 	 	0.12	 	 	 	0.11	 

 

    	 

    	 

    

 

Magic
Software’s management believes that the presentation of non-GAAP measures provides useful information to investors and management
regarding financial and business trends relating to the Company’s financial condition and results of operations as well
as the net amount of cash generated by its business operations after taking into account capital spending required to maintain
or expand the business.

 

These
non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles and may
be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP financial measures are not
based on any comprehensive set of accounting rules or principles. Magic Software believes that non-GAAP financial measures have
limitations in that they do not reflect all of the amounts associated with Magic Software’s results of operations as determined
in accordance with GAAP and that these measures should only be used to evaluate Magic Software’s results of operations in
conjunction with the corresponding GAAP measures.

 

Please
refer to the Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP tables below. 

 

 

About
Magic Software Enterprises

 

Magic
Software Enterprises Ltd. (NASDAQ and TASE: MGIC) is a global provider of mobile and cloud-enabled application and business integration
platforms.

 

For
more information, visit www.magicsoftware.com.

 

 

Forward
Looking Statements

 

Some
of the statements in this press release may constitute “forward-looking statements” within the meaning of Section
27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the United States Private Securities
Litigation Reform Act of 1995. Words such as "will," "expects," "believes" and similar expressions
are used to identify these forward-looking statements (although not all forward-looking statements include such words). These
forward-looking statements, which may include, without limitation, projections regarding our future performance and financial
condition, are made on the basis of management’s current views and assumptions with respect to future events. Any forward-looking
statement is not a guarantee of future performance and actual results could differ materially from those contained in the forward-looking
statement. These statements speak only as of the date they were made, and we undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise. We operate in a changing environment. New risks
emerge from time to time and it is not possible for us to predict all risks that may affect us. For more information regarding
these risks and uncertainties as well as certain additional risks that we face, you should refer to the Risk Factors detailed
in our Annual Report on Form 20-F for the year ended December 31, 2013 and subsequent reports and registration statements filed
from time to time with the Securities and Exchange Commission.

 

Magic
is a registered trademark of Magic Software Enterprises Ltd. All other product and company names mentioned herein are for identification
purposes only and are the property of, and might be trademarks of, their respective owners.

 

Press
Contact:

 

Tania
Amar, VP Global Marketing

Magic
Software Enterprises

Tel:
+972 (0)3 538 9300

tania@magicsoftware.com

 

 

 

    	 

    	 

    

 

MAGIC
SOFTWARE ENTERPRISES LTD. AND ITS SUBSIDIARIES

CONDENSED
CONSOLIDATED STATEMENTS OF INCOME

U.S.
dollars in thousands (except per share data)        

 

	 	 	Three months
    ended	 
	 	 	March 31,	 
	 	 	2014	 	 	2013	 
	 	 	Unaudited	 
	Revenues	 	$	40,949	 	 	$	33,414	 
	Cost of Revenues	 	 	24,307	 	 	 	19,890	 
	Gross profit	 	 	16,642	 	 	 	13,524	 
	Research and development, net	 	 	1,180	 	 	 	883	 
	Selling, marketing and general and	 	 	 	 	 	 	 	 
	    administrative expenses	 	 	9,509	 	 	 	8,000	 
	Total operating costs and expenses	 	 	10,689	 	 	 	8,883	 
	Operating income	 	 	5,953	 	 	 	4,641	 
	Financial expenses, net	 	 	(139	)	 	 	(398	)
	Income before taxes on income	 	 	5,814	 	 	 	4,243	 
	Taxes on income	 	 	966	 	 	 	495	 
	Net income	 	$	4,848	 	 	$	3,748	 
	Net income attributable to non-controlling interests	 	 	(353	)	 	 	(228	)
	Net income attributable to Magic Software's Shareholders	 	$	4,495	 	 	$	3,520	 
	Net earnings per share attributable to	 	 	 	 	 	 	 	 
	   Magic Software's shareholders:	 	 	 	 	 	 	 	 
	Basic	 	$	0.11	 	 	$	0.10	 
	Diluted	 	$	0.11	 	 	$	0.10	 
	Weighted average number of shares used in	 	 	 	 	 	 	 	 
	     computing net earnings per share attributable to	 	 	 	 	 	 	 	 
	     Magic Software's shareholders:	 	 	 	 	 	 	 	 
	        Basic	 	 	39,505	 	 	 	36,594	 
	        Diluted	 	 	39,858	 	 	 	37,096	 

 

 

    	 

    	 

    

 

MAGIC
SOFTWARE ENTERPRISES LTD. AND ITS SUBSIDIARIES

RECONCILIATION
OF GAAP AND NON-GAAP RESULTS

STATEMENTS
OF INCOME FOR COMPARATIVE PURPOSES

U.S.
dollars in thousands (except per share data)        

 

 

	 	 	Three
    months ended	 
	 	 	March
    31,	 
	 	 	2014	 	 	2013	 
	 	 	Unaudited	 
	GAAP
    gross profit	 	$	16,642	 	 	$	13,524	 
	Amortization of capitalized
    software	 	 	954	 	 	 	973	 
	Amortization of other
    intangible assets	 	 	46	 	 	 	45	 
	Stock-based compensation	 	 	1	 	 	 	4	 
	Non-GAAP
    gross profit	 	$	17,643	 	 	$	14,546	 
	 	 	 	 	 	 	 	 	 
	GAAP
    operating income	 	$	5,953	 	 	$	4,641	 
	Gross profit adjustments	 	 	1,001	 	 	 	1,022	 
	Amortization of other
    intangible assets	 	 	910	 	 	 	689	 
	Capitalization of software
    development	 	 	(1,099	)	 	 	(1,210	)
	Change in valuation
    of contingent consideration	 	 	(400	)	 	 	-	 
	Stock-based compensation	 	 	43	 	 	 	89	 
	Non-GAAP
    operating income	 	$	6,408	 	 	$	5,231	 
	 	 	 	 	 	 	 	 	 
	GAAP
    net income attributable to Magic Software's shareholders	 	$	4,495	 	 	$	3,520	 
	Operating income adjustments	 	 	455	 	 	 	590	 
	Unwinding of discount
    in connection with liabilities due to acquisitions	 	 	-	 	 	 	207	 
	Amortization expenses
    attributed to redeemable non-controlling interests	 	 	(37	)	 	 	(30	)
	Deferred
    taxes on the above items	 	 	49	 	 	 	(47	)
	 	 	 	 	 	 	 	 	 
	Non-GAAP
    net income attributable to Magic Software's shareholders	 	$	4,962	 	 	$	4,240	 
	Non-GAAP basic net
    earnings per share	 	 	 	 	 	 	 	 
	   attributable
    to Magic Software shareholders	 	 	0.13	 	 	 	0.12	 
	Weighted average number of shares used
    in	 	 	 	 	 	 	 	 
	   computing
    basic net earnings per share	 	 	39,505	 	 	 	36,594	 
	 	 	 	 	 	 	 	 	 
	Non-GAAP diluted net
    earnings per share	 	 	 	 	 	 	 	 
	   attributable
    to Magic Software shareholders	 	 	0.12	 	 	 	0.11	 
	Weighted average number of shares used
    in	 	 	 	 	 	 	 	 
	   computing
    diluted net earnings per share	 	 	39,897	 	 	 	37,148	 

 

 

 

    	 

    	 

    

 

MAGIC
SOFTWARE ENTERPRISES LTD. AND ITS SUBSIDIARIES

CONDENSED
CONSOLIDATED BALANCE SHEETS

U.S.
dollars in thousands      

 

	 	 	 	 	 	 	 
	 	 	March 31,	 	 	December 31,	 
	 	 	2014	 	 	2013	 
	 	 	Unaudited	 	 	 	 
	       ASSETS	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	CURRENT ASSETS:	 	 	 	 	 	 	 	 
	     Cash and cash equivalents	 	$	87,419	 	 	$	35,134	 
	     Available-for-sale marketable securities	 	 	439	 	 	 	854	 
	     Trade receivables, net	 	 	37,357	 	 	 	31,976	 
	     Other accounts receivable and prepaid expenses	 	 	5,737	 	 	 	5,209	 
	Total current assets	 	 	130,952	 	 	 	73,173	 
	 	 	 	 	 	 	 	 	 
	LONG-TERM RECEIVABLES:	 	 	 	 	 	 	 	 
	    Severance pay fund	 	 	415	 	 	 	403	 
	    Other long-term receivables	 	 	3,888	 	 	 	3,792	 
	Total long-term receivables	 	 	4,303	 	 	 	4,195	 
	 	 	 	 	 	 	 	 	 
	PROPERTY AND EQUIPMENT, NET	 	 	1,989	 	 	 	1,773	 
	INTANGIBLE ASSETS AND GOODWILL, NET	 	 	87,467	 	 	 	87,862	 
	 	 	 	 	 	 	 	 	 
	TOTAL ASSETS	 	$	224,711	 	 	$	167,003	 
	 	 	 	 	 	 	 	 	 
	       LIABILITIES AND EQUITY	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	CURRENT LIABILITIES:	 	 	 	 	 	 	 	 
	     Short-term debt	 	$	1,055	 	 	$	1,055	 
	     Trade payables	 	 	4,574	 	 	 	4,149	 
	     Accrued expenses and other accounts payable	 	 	16,140	 	 	 	16,937	 
	     Deferred tax liability	 	 	1,979	 	 	 	2,567	 
	     Deferred revenues	 	 	8,245	 	 	 	3,294	 
	Total current liabilities	 	 	31,993	 	 	 	28,002	 
	 	 	 	 	 	 	 	 	 
	NON-CURRENT LIABILITIES:	 	 	 	 	 	 	 	 
	     Long-term debt	 	 	2,037	 	 	 	2,274	 
	     Long-term deferred tax liabilty	 	 	2,106	 	 	 	2,204	 
	     Liabilities due to acquisition activities	 	 	539	 	 	 	1,396	 
	     Accrued severance pay	 	 	1,336	 	 	 	1,275	 
	Total non-current liabilities	 	 	6,018	 	 	 	7,149	 
	 	 	 	 	 	 	 	 	 
	REDEEMABLE NON-CONTROLLING INTEREST	 	 	2,848	 	 	 	2,721	 
	 	 	 	 	 	 	 	 	 
	SHAREHOLDERS' EQUITY:	 	 	 	 	 	 	 	 
	   Magic Software Shareholders' equity	 	 	182,675	 	 	 	128,144	 
	   Non-controlling interests	 	 	1,177	 	 	 	987	 
	Total shareholders' equity	 	 	183,852	 	 	 	129,131	 
	 	 	 	 	 	 	 	 	 
	TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST AND EQUITY	 	$	224,711	 	 	$	167,003JOINT
VENTURE AGREEMENT

VADER
PROJECT

 

LEWIS
CO. AND COWLITZ CO.

WASHINGTON

 

THIS
AGREEMENT (the "Agreement”), dated as of the 27th day of December, 2006 (“Effective Date”), is entered into
by and among Oklaco Holding L.L.C. hereinafter referred to as “Oklaco” or “Interest Owner”, Citrus Energy
Corporation hereinafter referred to as either “Citrus” or "Operator" or “Interest Owner”, as
the context may require, and E & Pco, LLC hereinafter referred to as either “E & P” or “Interest Owner”.

 

WHEREAS,
the Members of this Joint Venture have the opportunity to acquire by leasing, certain undeveloped oil and gas leasehold within
an AMI, as defined below, and participate, jointly, in the development of the farmed-in acreage position already acquired by “E
& P” known as the International Paper Block hereinafter referred to as “IP”, to explore for and produce oil,
gas and coal bed methane therefrom and to further acquire such additional developed and undeveloped acreage within the AMI as may
be desirable.

 

NOW,
THEREFORE, in consideration of their mutual promises, the Members to include the “Operator” and the “Interest
Owner” (s) hereby agree as follows:

 

ARTICLE
1.

ORGANIZATIONAL
MATTERS

 

Section
1.1 Purpose and Business of the Joint Venture. The Members
hereby form a joint venture (“Joint Venture”) for the limited purpose of exploring for oil, gas and coal bed methane
within an area of mutual interest (“AMI”) as described in Exhibit “A”, also known as the Vader Project.
The Joint Venture shall not engage in any other business activity unless otherwise agreed to by the Members.

 

Section
1.2 Name. The name of the Joint Venture shall be “Vader
Project” and the business of the Joint Venture shall be conducted solely under that name.

 

Section
1.3 Offices. The Joint Venture’s office shall be located
at 399 Perry Street, Ste 203, Castle Rock, Colorado 80104.

 

ARTICLE
2.

DEFINITIONS

 

Section
2.1 Definitions. For purposes of this Agreement, the following
terms shall have the following meanings.

 

"Affiliate"
means as to any Person, any other Person who directly or indirectly Controls, is under Common Control with, or is Controlled by
such Person.

 

    	 

    	 

    

 

"Agreement"
means this Agreement, as it may be modified, amended or supplemented from time to time.

 

“Area
of Mutual Interest” or "AMI",
shall mean the geographical area included within the following areas of Lewis and Cowlitz Co., Washington: T 10
N – T 14 N and R 1 W–  R 4 W as more particularly described in Exhibit A.

 

“Control”
together with its correlative meanings, "Controlled by" and "under Common Control with," shall mean possession,
directly or indirectly, of power to direct or cause the direction of management or policies, whether through ownership of securities
or partnership or other ownership interests, by contract or otherwise.

 

"Interest"
shall mean the rights of the Members to all allocations and distributions of the Joint Venture, including a Member’s pro
rata share of all property, assets, revenues, costs and expenses in the AMI. The Interest of each Member is set forth on Exhibit
B.

 

"Interest
Owner" shall mean and include a natural person, corporation, partnership, trust, and estate, Limited Liability
Company, governmental unit, or other entity.

 

“International
Paper” or “IP” means International Paper Company, a New York corporation.

 

“Joint
Operating Agreement” shall mean the Model Form Operating Agreement, AAPL Form 610-1989, as amended by agreement
of a Majority in Interest.

 

"Majority
in Interest" shall mean a majority of the Interests held by the Members.

 

"Member(s)"
means the Member(s) executing this Agreement as Member(s).

 

“Notice”
means notices, requests, demands, claims, and any other communications that are required to be, or which may be, given by any Party
hereto or the Operator under this Agreement.

 

"Operator"
shall mean Citrus, or any successor Operator.

 

"Transfer"
shall mean any sale, transfer, assignment, conveyance, pledge, hypothecation, or gift.

 

ARTICLE
3

MEMBERS

 

Section
3.1 Member. The Joint Venture shall be entitled to treat
the Person in whose name any Interest is noted on Exhibit “B”, as the owner thereof, and shall not be bound to recognize
any equitable or other claim or other interest in such Interest on the part of any other Person, until the Joint Venture shall
have express or other notice thereof, for all purposes.

 

Section
3.2 Reimbursement. Except as expressly set forth in this
Agreement or approved in writing by the Joint Venture, Members may not receive reimbursement for any expenses incurred on behalf
of the Vader Project.

 

    	2

    	 

    

 

ARTICLE
4

OPERATOR

 

Section
4.1 Operator. The management of the Vader Project shall
be vested in an operator (the "Operator"). Any person dealing with the Vader Project may rely absolutely upon the act,
deed and/or signature of the Operator as being the act of the Vader Project, and no person shall be obliged to inquire into or
otherwise ascertain whether the act of the Operator has been duly authorized. Citrus is hereby designated as the Operator of the
Vader Project until Citrus resigns or is removed pursuant to the terms and conditions hereof. The Operator shall have no authority
to act for or to assume any obligations on behalf of the Joint Venture except as specifically set forth in this Agreement. The
Operator shall have no authority to act for or on behalf of any “Interest Owner” other than itself.

 

Section
4.2 Duties and Authority. The Operator shall have the duties
and authority set forth in this Section 4.2 and as specifically set forth in this Agreement; provided, however, that the such duties
and authority shall at all times be subject, and subordinate, to compliance with the requirements set forth in Exhibit C attached
hereto.

 

(a)          General
Supervision. The Operator shall be responsible for the general overall supervision of the business and affairs of the
Vader Project. The Operator may sign, on behalf of the Vader Project, contracts or other instruments necessary to conduct business,
except in cases where the signing or execution thereof shall be expressly delegated by this Agreement to some other agent of the
Joint Venture; and, in general, the Operator shall perform all duties necessary to manage the business of the Vader Project. Any
gas produced or gathered in the Vader Project (except to the extent converted to LNG by the Vader Project) shall be gathered pursuant
to a gas gathering agreement the form, terms, and conditions of which will be as set forth in a written Gas Gathering Agreement
to be entered into and executed by each of the Members.

 

(b)          Drilling
of Wells. The Operator shall drill and complete the initial Evaluation Wells in accordance with the schedule agreed
by the Joint Venture. The Operator shall have the right and authority to use as it chooses, and to contract for, such materials
and services, as it deems reasonably necessary, in its sole discretion, for the drilling of the Evaluation Wells. The Operator
shall maintain insurance in amounts that are required by law and that a prudent operator acting reasonably would acquire and maintain.

 

(c)          Compliance
with Laws. The Operator shall comply with all applicable laws, rules, regulations and ordinances relating to the construction,
management, development, ownership and operation of the Vader Project and shall secure all necessary permits, licenses, authorizations,
approvals and rights of way for the construction and operation of the Vader Project.

 

(d)          Duties.
Operator shall in good faith and in compliance with this Agreement conduct or cause to be conducted the ordinary and usual business
affairs of the Joint Venture. The Operator shall not, without consent from the Majority in interest of the Interest Owners, commit
to expend more than Twenty-Five
Thousand Dollars ($25,000) (except normal costs to operate the Vader Project), during any calendar year with respect to the Joint
Venture.

 

    	3

    	 

    

 

Section
4.3 Operator Resignation, Replacement or Vacancy. The Operator shall hold office until the Operator's resignation or
removal.

 

(a)          In
the event of resignation of Operator, Operator shall give the Joint Venture and each of the Members, Notice in writing of such
resignation (“Resignation Notice”), which shall be effective thirty (30) days after latest applicable Notice Effective
Date, or, earlier, if a Majority in Interest (not including the Interest of Citrus, if Citrus is the resigning Operator) so determines

 

(b)          In
the event Operator shall file bankruptcy, voluntarily or involuntarily, have a receiver appointed, and/or become insolvent (one
or more of such events, herein “Event(s)”), Operator shall be deemed to have given a Resignation Notice , concurrently
with the date of the earliest to occur of any such Event. The resignation pursuant to such Resignation Notice shall likewise be
deemed effective as of such date. Any vacancy occurring in the position of Operator may be filled by the appointment of a Person
by vote of the Majority in Interest. Any successor Operator shall agree in writing to be bound by the terms and conditions of this
Agreement and, without such agreement, shall not be qualified to act as Operator and shall not hold such position.

 

Section
4.4 Certain Breaches of Duty. No Operator of the Vader Project shall be liable to the Joint Venture or its Members for
monetary damages for breach of fiduciary duty as an Operator; provided, however, that nothing contained herein shall eliminate
or limit the liability of an Operator (i) for any breach of the Operator's duty of loyalty to the Joint Venture or its Members,
(ii) for acts or omissions not in good faith or that involve intentional misconduct, gross negligence, or a knowing violation of
the law, or (iii) for any transaction from which the Operator derived an improper personal benefit. No amendment to, or repeal
of, this Section 4.4 shall apply to, or have any effect
on, the liability or alleged liability of the Operator for or with respect to any act or omission of the Operator occurring prior
to such amendment or repeal.

 

Section
4.5 Removal. In the event Operator shall default in the performance of any of its obligations hereunder, the Joint Venture
shall give Operator written notice thereof (“Default Notice”) and such default shall continue for a period of thirty
(30) days after the Notice Effective Date of the Default Notice, then Operator shall, on the thirty first (31st) day
after such Notice Effective Date, cease being, and shall be deemed removed, as Operator. By vote of a Majority in Interest (not
including the Interest of Citrus, if Citrus is the defaulting Operator), a new Operator shall be appointed with immediate effect.

 

Section
4.6 Resignation. The Operator may resign by giving ninety (90) days written notice to the Members. Such resignation
shall be effective at the time specified therein, provided that such time is at least ninety (90) days from such notice, or, if
no such time is stated therein, upon ninety (90) days following receipt of such notice. Unless otherwise specified in the notice
of resignation, no acceptance of such resignation shall be necessary to make it effective.

 

    	4

    	 

    

 

Section
4.7 Notice. Notices to the Operator shall be in writing and delivered personally, mailed or sent via confirmed facsimile
or by a nationally-recognized express service to the Operator’s attention at the address of the Operator.

 

Section
4.8 Reimbursement and Overhead. The Operator shall
receive a base overhead, to becharged monthly in accordance with a mutually agreed upon Joint Operating Agreement “JOA”.

 

Section
4.9 Restrictions. Notwithstanding any other provision of this Agreement, no Operator shall cause the Joint Venture to
do any of the following without the express written consent of all Members of the Joint Venture.

 

(a)          Sell
or otherwise dispose of all or any of the Joint Venture’s assets;

 

(b)          Merge,
consolidate or combine with any other Person;

 

(c)          Dissolve
or liquidate the Joint Venture;

 

(d)          Admit
an Additional Member or Substitute Member to the Joint Venture.

 

ARTICLE
5

INTEREST
IN THE JOINT VENTURE

 

Section
5.1 Interest in the Joint Venture. The Interests of the Members in the Joint Venture shall be as set forth on Exhibit
B hereto.

 

Section
5.2 Initial Evaluation Wells. The first two evaluation wells (“Evaluation Wells”) to be drilled by the
Joint Venture will be located in sections                                                 ,
the precise locations of which inside such Sections will be as agreed by all of the Members.

 

Section
5.3 Initial Evaluation Wells Ownership. Citrus and Oklaco will cause to be drilled, two initial Evaluation Wells as
described in Section 5.2 above and pay 100 % of the costs associated with the drilling and completion attempts. At such time that
the initial two Evaluation Wells have jointly reached payout, E & P will have the option and may elect to be assigned, without
charge, a 40% working interest in these initial Evaluation Wells. Payout shall be defined as that point in which the paying “Interest
Owner”(s) have recouped their costs to include, among other things, the cost of building roads, staking and clearing locations,
drilling contractor costs, drill stem tests, logging expenses, costs of setting production casing and any other associated costs
with the completion attempt or the costs to plug and abandon any one or more of the two initial Evaluation Wells.

 

Section
5.4 Subsequent Wells. Any subsequent wells drilled within the AMI after the initial Evaluation Wells have been drilled
(“Subsequent Well(s)”), will be drilled on a 50/50 basis whereby, E & P will own a 50% working interest and, in
the aggregate, Citrus and Oklaco will own 50%. Subsequent Wells may be proposed by any Member and the election to join-in or farm-out
will be governed by a mutually agreed upon, standard industry, Joint Operating Agreement with the terms of any proposed join-in
or farm-out being on a mutually acceptable basis by the Members. It is further agreed that any Member not wishing to participate
in a proposed subsequent well, may not elect to go non-consent
under the Operating Agreement. The non-participating Member will surrender its rights to participate in the proposed Subsequent
Well on mutually acceptable farm-out terms as mentioned above.

 

    	5

    	 

    

 

Section
5.5 Acreage Ownership. Participation and ownership of the acreage within the AMI.

 

(a)          E
& P has obtained an option agreement, Exhibit “D” (“IP Option”), on the International Paper Company
leasehold within the AMI. The Parties acknowledge and agree that, in accordance with Section 7 of the IP Option, no rights under
the IP Option may be assigned without the prior written consent of IP. The Members agree to cooperate in securing such consent
as soon as possible.

 

(b)          Any
newly acquired leasehold within the AMI will be jointly owned 50% by E & P and, in the aggregate, 50% by Citrus and Oklaco.
Any costs associated with acquiring the leasehold or lease bonus will be borne by the Members in the percentages as described above.
It is understood that E & P will bear its 50% share of any leasehold costs within the initial two drill sites.

 

(c)          By
the terms of this Joint Venture Agreement, the IP Option, along with all of the terms and conditions will be shared on a 50/50
basis whereby, E & P will own a 50% interest in the IP Option acreage and Citrus and Oklaco, in the aggregate, a 50% interest.
All Members will be bound by the terms of the IP Option.

 

(d)          The
members will share according to their Interest on any additional acreage acquired by farm-in (out? Join-in?) or other negotiated
terms from other leasehold owners within the AMI.

 

ARTICLE
6

AMENDMENTS

 

Section
6.1 Amendments. The Articles or this Agreement may be amended only by a written document signed by all of the Members
and the Joint Venture.

 

ARTICLE
7

DISTRIBUTIONS

 

Section
7.1 Accounting. The Operator shall provide a monthly accounting of expenses and income of the Joint Venture, allocated
to the Members in accordance with their Interest.

 

    	6

    	 

    

 

ARTICLE
8

RESTRICTIONS
ON TRANSFERS; ADDITIONAL MEMBERS

 

Section
8.1 Transfers. The Members may transfer all or part of their Interests to any Person or Persons. Assignments and transfers
of Interests shall be subject to, and the assignee or transferee shall acquire the assigned or transferred Interests subject to,
all of the terms and provisions of this Agreement. Any person who is the assignee or transferee of an Interest shall be subject
to all the provisions of this Article 8 to the same extent
and in the same manner as any Member desiring to make an assignment or transfer of his Interest. An assignment or transfer of an
Interest shall not relieve the assigning or transferring Member from such Member’s duties and obligations to the Company
unless: (1) the assignment or transfer is made in connection with the assignment or transfer of such Members interest in the AMI
(2) the assignment or transfer is made pursuant to Section 8.3 hereof; or (3) the Operator and a majority in Interest agree in
writing to release such Member.

 

Section
8.2 Assignee, Transferee or Additional Member. No assignee, transferee or additional Member shall become a Member until
such assignee, transferee or additional Member shall have agreed in writing to be bound by the terms and conditions of this Agreement
together with such amendments as are agreeable to the transferee and each of the Members.

 

Section
8.3 Preferential Right To Purchase. Should any Member desire to sell all or any part of its interest under this Agreement
and in and to the Joint Venture, which sale is not in connection with the sale or transfer of such Members Interest in the AMI,
it shall promptly give written notice to the other Member(s), with full information concerning its proposed sale, which shall include
the name and address of the prospective purchaser (who must be ready, willing and able to purchase), the purchase price, and all
other terms of the offer. The other Member(s) shall then have an optional prior right, for a period often (10) days after receipt
of the written notice, to purchase on the same terms and conditions the interest which the other Member proposes to sell; and,
if this optional right is exercised, the purchasing Member(s) shall share the purchased interest in the proportions that the interest
of each bears to the total interest of all purchasing Members. There shall be, however, no preferential right to purchase in those
cases where any Member wishes to mortgage its interests, or to dispose of its interests by merger, reorganization, consolidation
or sale of all or substantially all of its assets to a subsidiary or parent company or to a subsidiary of a parent company, or
to any company in which any such Member owns a majority of the stock.

 

ARTICLE
9

NOTICE

 

Section
9.1 Notice. Any Notice given by any Member or the Operator (“Notifying Person”) shall be in writing addressed
to the each of the other Members and the Operator (“Intended Recipient(s)”), at the relevant Intended Recipient’s
address set forth below. Any Notice shall be (i) delivered in person or by same day or overnight courier, (ii) sent by electronic
facsimile or E-mail transmission, or (iii) mailed, certified first class mail, postage prepaid, return receipt requested, to each
of the Intended Recipients at the following addresses:

 

    	7

    	 

    

 

	If to Oklaco Holding L.L.C.	 
	 	 
	Oklaco Holding L.L.C.	 
	 	Attn:	 	 
	Tel.	 
	Fax:	 
	E-mail:	 
	 	 
	If to Citrus Energy Corporation	 
	 	 
	Citrus Energy Corporation	 
	 	Attn:	 	 
	Tel.	 	 	 
	Fax:	 	 
	E-mail:	 	 

 

	If to E & Pco International, LLC
	 
	E & Pco International, LLC

Attn: Charles E. Edwards

2500 Tanglewilde #492, Houston, TX 77063

	Tel:	713-978-6551	 
	Fax:	713-978-6772	 
	E-mail:         ChuckEdwards@e-pco.com	 

 

or
to such other address as an Intended Recipient shall have furnished to the Notifying Person by Notice given in accordance with
this Section. A Notice shall be effective (“Notice Effective Date”) (i) if delivered in person or by courier, upon
actual receipt by the Intended Recipient, (ii) if sent by electronic facsimile or email transmission, when the Notifying Person
receives facsimile or email confirmation that such notice was received at the facsimile number or email address, as the case may
be, of the Intended Recipient’s, or (iii) if mailed, upon
the earlier of five (5) business
days after deposit in the mail or the date of delivery as shown by the return receipt therefor.

 

RTICLE
10

GENERAL
PROVISIONS

 

Section
10.1 Disclaimer. This agreement shall not be construed to represent any type of income tax partnership or legal entity.

 

Section
10.2 Indemnification. No Member or Operator shall be indemnified by the Joint Venture for any matter.

 

    	8

    	 

    

 

Section
10.3 Entire Agreement. This Agreement embodies the entire understanding and agreement among Citrus, Oklaco, and E &
P concerning the Joint Venture, and supersedes any and all prior negotiations, understandings or agreements in regard thereto.

 

Section
10.4 Counterparts. This Agreement may be executed in multiple counterpart copies, each of which shall be considered
an original and all of which taken together shall constitute one and the same instrument.

 

Section
10.5 Choice of Law. This Agreement shall be construed and interpreted according to the laws of the State of Washington
excluding any conflict of laws or rule which would apply the law of another jurisdiction.

 

Section
10.6 Binding Effect. This Agreement and all of the terms and provisions hereof shall be binding upon and shall inure
to the benefit of the Members, the Operator, and their respective heirs, executors, administrators, trustees, successors and permitted
assigns.

 

Section
10.7 Gender and Number; Person. Whenever the context requires, the gender of all words used herein shall include the
masculine, feminine and neuter, and the number of all words shall include the singular and plural thereof has been appointed. "Person"
means any individual, corporation, partnership, limited liability company, firm, joint venture, association, joint-stock company,
trust, unincorporated organization, governmental body, or other entity.

 

Section
10.8 Conflict. It is understood and acknowledged that Citrus been designated as Operator pursuant to the terms hereof,
is the Operator under the terms of the Joint Operating Agreement, and is also an Interest Owner. To the extent the terms or provisions
of this Agreement conflict with, are different than, are in addition to, or otherwise vary from, the terms of the Joint Operating
Agreement, then this Agreement shall take precedence and prevail in all circumstances over the Joint Operating Agreement.

 

EXECUTED
by the Parties hereto as of the Effective Date.

 

	CITRUS ENERGY CORPORATION	 
	 	 	 
	By: 	 	 
	Printed Name:	 	 
	Title:	 	 
	 	 	 
	OKLACO HOLDING L.L.C.	 
	 	 	 
	By: 	 	 
	Printed Name:	 	 
	Title:	 	 
	 	 	 
	E & Pco, LLC
	By: 	 	 
	Charles E. Edwards, President and CEO

 

    	9

    	 

    

 

EXHIBIT A

 

AMI 

 

    	 

    	 

    

 

EXHIBIT
B

 

MEMBERS

 

    	 

    	 

    

 

EXHIBIT
C

 

DATA
ACQUISITION PROCEDURES

 

The following
are the data acquisition procedures to be used, as applicable, for the CBM evaluation wells in the Chehalis Basin.

 

		1.	Drill two evaluation wells to penetrate the Eocene coal
sequence (thru the Black Seam) maintaining drilling fluid weight at or below predicted insitu reservoir pressures. This is a mud
log requirement to facilitate the identity, and to assess the quality, of gas shows recorded by the chromatograph while drilling.
The mud logging unit must maintain a carefully calibrated chromatograph and record the various monitors from the rig floor such
as depth, ROP, mud weight, salinity, pH, viscosity, temperature and gamma ray, if available. Incorporate via Pason, if possible.
Mud logger should take care in sample selection at intervals of 20 feet or less where drilling rate permits. Logger should examine
cleaned samples in a reasonably continuous manner to determine lag, report shows, and provide lithologic description of the penetrated
section, Chromatographs should be calibrated one or two times each day.

 

		2.	The log suite needs to be run with weight of fluids in
the hole approximating insitu pressures of the CBM reservoirs and without injurious addictives which may be harmful to the coal
seams. A full suite of Schlumberger, Halliburton or other contractor Suites equivalent to “Platform
Express” should be run. This includes Caliper, SP, GR, Resistivities, Neutron Density and Gamma-Gamma Density.
As special log additions, a digital waveform sonic, a spectral density log and an acoustic or audio-temperature log. The latter
is the reason for maintaining the desired constraints on mud weight.

 

		3.	To assure accuracy of dip direction and magnitude for
the strike-oriented laterals, each 2500-3000 feet,
geosteered and drilled in underbalanced medium, it may be necessary to run an oriented image log across the objective coal seam.
I believe logging companies have a 500 foot minimum service for image logs. Aside from its use as a high-resolution dip meter,
the log will add much detail for the coal’s reservoir characteristics. At the projected total depth, be sure to add the
length of the logging tool makeup for a rat hole. This will allow all sensors to read the desired section.

 

		4.	When log runs and analyses are completed, side wall cores
of the most promising CBM reservoirs should be secured and canistered, placed in a controlled environment for maturity and gas
content determinations in the laboratory. Sidewall cores may not prove as effective as conventional full wireline cores, but E&Pco’s
experience with rotary cored sidewalls has been encouraging. Even so, where CBM reservoir depths can be accurately predicted,
full size wireline coring is recommended.
Such cores will provide more reliable desorption data for reserve calculations.

 

    	 

    	 

    

 

EXHIBIT
D

 

IP OPTION
AGREEMENT

 

    	 

    	 

    

 

Section
9.7 Gender and Number: Person. Whenever the
context requires, the gender of
all words used herein shall include the masculine, feminine and neuter, and the number of
all words shall include the singular and plural thereof
has been appointed.

 

Section
9.8. Conflict. It is
understood and acknowledged that Citrus been designated as
Operator pursuant to the terms hereof, is the Operator under the terms of the Joint Operating Agreement, and is aiso an
Interest Owner. To the extent the terms or provisions
of this Agreement conflict with, are different than, are in addition to, or otherwise vary from, the terms of the Joint
Operating Agreement, then this Agreement shall
take precedence and prevail in all circumstances over the Joint Operating Agreement.

 

EXECUTED
by the Parties hereto effective as of the date first above stated. 

 

	CITRUS ENERGY CORPORATION	 
	 	 	 
	By: 	/s/ Lance Peterson	 
	Printed Name:	 Lance Peterson	 
	Title:	President	 
	 	 	 
	OKLACO HOLDING L.L.C.	 
	 	 	 
	By: 	/s/ D. Bloustine	 
	Printed Name:	D. Bloustine	 
	Title:	President	 
	 	 	 
	E & Pco, LLC
	By: 	/s/ Charles E. Edwards	 
	Printed Name: 	Charles E. Edwards	 
	Title:	President	 

 

    	8

    	 

    

 

partial assignment
of oil and gas leases

 

	County of Lewis	}
	 	} SS
	State of Washington	}

 

KNOW
ALL MEN BY THESE PRESENTS:

 

THAT
the undersigned, Citrus Energy Corporation, 399 Perry St.,
Ste 203, Castle Rock, CO 80104, herein referred to as Assignor, for and in consideration of the sum of Ten Dollars ($10.00) and
other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, does hereby sell, assign, transfer,
set over and convey unto E & Pco International, LLC, 2500
Tanglewilde, Suite 492, Houston, TX 77063, herein referred to as Assignee, an
undivided 50% of all Assignor’s right title and interest, their respective heirs or successors and assigns, in
and to the oil & gas leases underlying the lands described on Exhibit “A” attached hereto and made a part hereof
in Lewis County, Washington.

 

This
Assignment shall be subject to the terms and conditions of the oil and gas leases associated therewith and all intermediate assignments
thereof.

 

TO
HAVE AND TO HOLD the said leasehold interest, together with all and singular rights, privileges, hereditaments and appurtenances
thereunder in anywise belonging unto Assignee, its legal representatives, successors and assigns forever.

 

This
Assignment is made without warranty, either expressed or implied and shall extend to and be binding upon the heirs, executors,
administrators, trustees, successors and assigns of the respective parties.

 

IN
WITNESS WHEREOF, this assignment is executed this 29th day
of November, 2007.

 

	 	Citrus Energy Corporation
	 	 
	 	/s/ Lance Peterson
	 	By: Lance Peterson, President

 

 

 

	STATE OF Colorado	}
	 	} § (CORPORATE ACKNOWLEDGMENT)
	COUNTY OR DOULLAS	}

 

On
this 29th day of November,
2006, before me, a Notary Public in and for said County and State, personally appeared Lance
Peterson____________________, to me known to be the identical person who subscribed the name of the maker thereof
to the foregoing instrument as its President_______________and
acknowledged to me that the executed the same as his free
and voluntary act and deed and as the free and voluntary act and deed of such corporation for the uses and purposes therein sei
forth. Given under my hand and seal of office the day and year last above written.

 

	 	 	
	My Commission Expires:	 	Notary Public
	March 6, 2008	 	 
	Commission # N/A	 	 

 

    	 

    	 

    

 

EXHIBIT
"A"

 

Attached
to and made part of that certain Assignment of Overriding Royalty Interest dated November 29, 2007, by and between Citrus Energy
Corporation, Assignor, B & G Energy Corporation and Magma Gold, Inc., Assignees

 

	
         

        LESSOR
	 	
        EFFECTIVE

        DATE
	 	DESCRIPTION	 	PARCEL#
	 	 	 	 	 	 	 
	Raymond E. Pierce and Joyce Annette Pierce	 	2/22/2007	 	NE/4 NE/4 less and except the S 20' of Section 17-11N-2W	 	012290-001-000
	 	 	 	 	 	 	 
	
        Robert C. Craft
        & Joyce Rosemary Craft, Trustees of the Robert C. Craft & Joyce Rosemary Craft Trust executed December 23,

        1997
	 	1/26/2007	 	SE/4 NW/4 of Section 19- 11N-2W	 	012330-001-000
	 	 	 	 	 	 	 
	Raymond Parrish	 	1/19/2007	 	Part NW/4 NW/4 less 2 acre Except HWY of Section 32-11N-2W	 	012628-000-000
	 	 	 	 	 	 	 
	Rowland N. Randt, Sr., and Annie M. Randt	 	1/22/2007	 	SE/4 less south 208 feet of the east 208 feet; S/2 S/2 S/2 NE/4 of Section 30-12N-2W	 	015470-000-000
	 	 	 	 	 	 	 
	Robert C. Rose and Lorna J. Rose	 	1/26/2007	 	SE/4 less south 208 feet of the east 208 feet; S/2 S/2 S/2 NE/4 of Section 30-12N-2W	 	015470-000-000
	 	 	 	 	 	 	 
	Sharon Perniconi	 	1/30/2007	 	SE/4 less south 208 feet of the east 208 feet; S/2 S/2 S/2 NE/4 of Section 30-12N-2W	 	015470-000-000
	 	 	 	 	 	 	 
	Robert C. Craft, individually	 	2/1/2007	 	SW/4 NE/4 and SE/4 NW/4 of Section 14-12N-3W	 	015808-002-000

 

    	Page 1 of 6

    	 

    

 

	LESSOR	 	
        EFFECTIVE

        DATE
	 	DESCRIPTION	 	PARCEL#
	 	 	 	 	 	 	 
	C. Lee McCrite, a widow	 	2/6/2007	 	S/2 N/2 NW/4, part of S/2 NW/4 NE/4 lying west of King Road of Section 24-12N-3W	 	
        015888-000-000,

        015884-001-000

	 	 	 	 	 	 	 
	Doris J. Sterling and Claude B. Sterling, Trustees for the D. Sterling Family Trust	 	2/6/2007	 	W/2 NW/4 less north 633.6’; NW/4 SW/4 & E/2 SE/4 less S/2 SE/4 SE/4 of Section 32-13N-3W	 	
        019125-001-000,

        019125-000-000,

        019125-002-000,

        019127-000-000

	 	 	 	 	 	 	 
	Joseph R. and Betty M. Boyd	 	1/19/2007	 	SW/4 SE/4 of Section 33-13N-3W	 	019143-000-000
	 	 	 	 	 	 	 
	Pursley Family Tree Farm, a registered Washington Partnership	 	6/15/2007	 	N/2 SW/4 SW/4, west 10 acres of N/2 SE/4 SW/4 of Section 5-11N-2W	 	012084-001-000
	 	 	 	 	 	 	 
	John F. Maschke	 	2/21/2007	 	Part N/2 NE/4 SE/4 except Roe County Road of Section 6-11N-2W	 	012098-001-000
	 	 	 	 	 	 	 
	Pursley Family Tree Farm, a registered Washington
Partnership	 	6/15/2007		Lots 3, 4, SE/4 SW/4 of Section 7-11N-2W		
        012113-000-000,

        012114-001-000

	 	 	 	 	 	 	 
	Pursley Family Tree Farm, a registered Washington Partnership	 	6/15/2007	 	Lots 1,2,4, E/2 NW/4, SE/4 SW/4 of Section 18-11N-2W	 	
        012313-002-000,

        012313-005-000,

        012313-005-002,

        012315-003-002

	 	 	 	 	 	 	 
	John F. Maschke	 	2/21/2007	 	Part SW/4 NW/4 and part Gov. lot 3 lying West of creek and South of Hwy. 508 and Lot 4 of Section 30-11N-2W	 	
        012585-002-000,

        012598-000-000

	 	 	 	 	 	 	 
	J.A. Nowogroski	 	4/16/2007	 	 E/2 SW/4 Section 34-13N-3W	 	019149-000-000

 

    	Page 2 of 6

    	 

    

 

	LESSOR	 	
        EFFECTIVE

        DATE
	 	DESCRIPTION	 	PARCEL#
	 	 	 	 	 	 	 
	John F. Maschke	 	2/21/2007	 	Part N/2 N/2 of Section 31- 11N-2W, and Government Lots 1 and 2 SE/4 NW/4 of Section 31-11N-2W, and Portion SW/4 NE/4 and part NW/4 SE/4 West of unnamed creek of Section 31-11N-2W	 	
        012610003002,

        012616000000,

        012613001000

	 	 	 	 	 	 	 
	Robert M. Maschke	 	2/21/2007	 	Portion of N/2 NE/4 lying W of Olequa Creek & South-Easterly of unnamed creek & SE/4 NE/4 & NE/4 SE/4 of Section 31-11N-2W	 	
        12610-002-000,

        012614-000-000

	 	 	 	 	 	 	 
	Pursley Family Tree Farm, a registered Washington Partnership	 	3/8/2007	 	SE/4 NW/4 & pt. NE/4 SW/4 except Hemenway Rd. of Section 1-11N-3W	 	
        012718-002-000,

        012717-000-000

	 	 	 	 	 	 	 
	Pursley Family Tree Farm, a registered Washington Partnership	 	3/8/2007	 	E/2 NE/4 & E/2 SE/4 of Section 13-11N-3W	 	
        012909-000-000,

        012921-000-000

	 	 	 	 	 	 	 
	Pursley Family Tree Farm, a registered Washington Partnership	 	3/8/2007	 	SW/4 SE/4 of Section 31-12N-2W	 	015497-001-000
	 	 	 	 	 	 	 
	Donald J. Lynch & Ann C. Lynch	 	3/8/2007	 	5 ac. Tract in SE1/4 of Section 27-12N-2W	 	015393-008-000
	 	 	 	 	 	 	 
	Donald J. Lynch & Ann C. Lynch	 	3/8/2007	 	14.77 ac. Tract in NE1/4 of Section 34-12N-2W	 	015882-010-000
	 	 	 	 	 	 	 
	Kathy D. Miller, now Hansen and Davi Hansen	 	4/4/2007	 	NW/4 SW/4 except portion in Northwest corner and county roads in Section 4-11N-2W	 	012024-001-000

 

    	Page 3 of 6

    	 

    

 

	LESSOR	 	
        EFFECTIVE

        DATE
	 	DESCRIPTION	 	PARCEL#
	 	 	 	 	 	 	 
	Veronica Damm and Christine M. Damm	 	3/28/2007	 	The N/2 NE/4 NW/4 & S/2 NE/4 NW/4 in Section 9-11N-2W	 	
        012162-000-000,

        012165-001-000

	 	 	 	 	 	 	 
	Robert M. Arendt	 	3/28/2007	 	Part of N/2 J.B. Brule DLC Section 11 & 14 lying Northwesterly of Drewss Prairie Road except county road in Section 14-11N-2W	 	012246-001-000
	 	 	 	 	 	 	 
	Maxine Vodjansky	 	3/29/2007	 	Part J.B. Brule DLC lying Southeasterly of County Road and Southwesterly of Highway except County Road in Section 14-11N-2W	 	012247-003-000
	 	 	 	 	 	 	 
	Richard G. Conley and Lucy A. Conley	 	5/8/2007	 	Part of Government Lot 1 in Section 14-11N-2W	 	012249-003-000
	 	 	 	 	 	 	 
	Leonard Walter Aho	 	3/29/2007	 	SE/4 SW/4, S/2 SW/4 SW/4 lying West of Centerline of Creek and East of Telegraph Road, S/2 SW/4 SW/4 lying West Telegraph Road in Section 14-11N-2W	 	
        012258-001-000,

        012258-002-000

	 	 	 	 	 	 	 
	Norman J. McKnight	 	3/19/2007	 	Part of the N1/2 NW1/4 lying West of the RR ROW, less & except Winlock-Vader Hwy. ROW (See Exhibit 'B' attached to and made a part hereof) in Section 17-11N-2W	 	012292-000-000
	 	 	 	 	 	 	 
	Sandra L. Wakkuri and Jane Saarinen	 	4/11/2007	 	NW/4 SW/4 EXCEPT THE South 387’ of West 475’ and the S/2 SW/4 of road except County roads Section 21-11N-2W	 	012387-003-000
	 	 	 	 	 	 	 
	Terry Hanson	 	4/9/2007	 	Part of the NE/4 SE/4 Section 23-11N-2W	 	012442-014-002

 

    	Page 4 of 6

    	 

    

 

	LESSOR	 	
        EFFECTIVE

        DATE
	 	DESCRIPTION	 	PARCEL#
	 	 	 	 	 	 	 
	Jane Louise Saarinen, a single woman	 	3/13/2007	 	Map 110228 Lot 1 & Lot 2 less that part N & W of Road & less W 30' S of Road & County Road Section 28-11N-2W	 	012549-000-000
	 	 	 	 	 	 	 
	Fred Blum	 	4/20/2007	 	Lot 4 and SE/4 SW/4 less road Section 30-12N-2W	 	015477-000-000
	 	 	 	 	 	 	 
	Gladys Vasereno	 	3/6/2007	 	NE/4 NE/4 except road Section 30-12N-2W	 	015466-000-000
	 	 	 	 	 	 	 
	Jolyn 0. Strrauss, A Tenant in Common with Gene C. Ingles, and heir of George L. Ingles, deceased	 	5/14/2007	 	SW/4 & S/2 NW/4 Section 2-12N-3W	 	015675-000-000
	 	 	 	 	 	 	 
	Gene C. Ingles, a Tenant in Common with Jolyn O. Strauss, and heir of George L. Ingles, deceased	 	5/14/2007	 	SW/4 & S/2 NW/4 Section 2-12N-3W	 	015675-000-000
	 	 	 	 	 	 	 
	Gene C. Ingles, a Tenant In Common with Jolyn O. Strauss, an heir of Geroge L. Ingles, deceased	 	5/1/2007	 	SE/4 NE/4 Section 3-12N-3W	 	015681-000-000
	 	 	 	 	 	 	 
	Jolyn 0. Strauss, a Tenant in Common with Gene C. Ingles, an heir of George L. Ingles, deceased	 	5/1/2007	 	SE/4 NE/4 Section 3-12N-3W	 	015681-000-000
	 	 	 	 	 	 	 
	Gene C. Ingles, a Tenant In Common with Jolyn O. Strauss, an heir of Geroge L. Ingles, deceased	 	5/14/2007	 	NE/4 NW/4 Section 11-12N-3W	 	015769-002-000
	 	 	 	 	 	 	 
	Jolyn 0. Strauss, a Tenant in Common with Gene C. Ingles, an heir of George L. Ingles, deceased	 	5/14/2007	 	NE/4 NW/4 Section 11-12N-3W	 	015769-002-000

 

    	Page 5 of 6

    	 

    

 

	LESSOR	 	
        EFFECTIVE

        DATE
	 	DESCRIPTION	 	PARCEL#
	 	 	 	 	 	 	 
	Eunice K. Franklin	 	4/10/2007	 	NW/4 SW/4 & N/2 SW/4 SW/4 Section 13-12N-3W	 	015800-000-000
	 	 	 	 	 	 	 
	Eunice K. Franklin	 	5/17/2007	 	N/2 SE/4 SW/4 and the South 30’ of the SW/4 SE/4 Section 13-12N-3W	 	015802-000-000
	 	 	 	 	 	 	 
	Lloyd A. John & Sharon John	 	4/20/2007	 	E/2 SE/4 Section 21-13N-3W	 	018963-000-000
	 	 	 	 	 	 	 
	Manke Timber Company, Inc.	 	5/19/2007	 	W/2 SE/4 and South 20’ of the SE/4 NE/4 and South 20' of the East 307' of SW/4 NE/4 Section 27-13N-3W	 	019052-000-000
	 	 	 	 	 	 	 
	Lloyd A. John & Sharon John	 	4/20/2007	 	W/2 SE/4; Pt. W/2 NE/4; NE/4 NE/4 & E/2 E/2 NW/4 NE/4 Section 28-13N-3W	 	
        019053-001-000,

        019053-002-000,

        019060-000-000

	 	 	 	 	 	 	 
	Doris J. Sterling and Claude B. Sterling, Trustees for the D. Sterling Family Trust	 	5/30/2007	 	SE/4 NE/4 & NE/4 SE/4 except County road Section 31-13N-3W	 	019110-004-000

 

END OF EXHIBIT"A"

 

    	Page 6 of 6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00230-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00230-of-00352.parquet"}]]