Fill and Sign the Saltwater Disposal Well Leasing High Waters Float All Boats by Form

SALT WATER DISPOSAL WELL AND RIGHT OF WAY AGREEMENT(Grantee to use Existing Well Bore on the Land) State: County: Grantor: (Name and Address) Grantee: (Name and Address) Effective Date: For adequate consideration, Grantor, named above, grants, sells, and conveys to Grantee, named above, the right to enter on the land described below to place, construct, operat e, repair, maintain, and/or remove a salt water disposal well, pipelines, a monitoring well, and the right of ingress and egress over existing roads for the purposes provided for in this Agreement. The land (the "Land") to which this Agreement applies is located in the county and state named above and is described as follows: (Description of Land which is Subject of Agreement) To enable Grantee to conduct operations on the Land as provided for in this Agreement, Grantor and Grantee agree as follows: 1. Grantee shall pay the annual sum of $____ for all damages to and for the use of the La nd (the "Fee") for a period of ____ years commencing on the Effective Date stated above and ending on (Date), (the "Term"). This Fee shall be payable to Grantor simultaneously with the execution of this Agreement, and shall be paid and delivered annually to Grantor at the address above. 2. Grantee has the option to extend this Agreement beyond the Term. To continue thi s Agreement beyond the Term, Grantee must pay Grantor, on or before (The Date of The Last Da y of the Term), the sum of $____ for all damages to and for the use of the Land for a period of a n additional ____ years commencing on (Date) and ending on (Date), both dates inclusive being the "Second Term." Grantee's failure to make payment for the Second Term shall constitute a surrender and termination by Grantee of all rights in and under this Agreement. 3. Grantee shall utilize an existing well on the Land as a salt water disposal well. The well is located at (Describe Location of Well) and known as the ____ Well (the "Disposal Well"). Grantee is authorized to only dispose of salt water into the Disposal Well which is a byproduct of hydrocarbons produced from the following lands located in the county and state named above (the "Producing Lands"): (Description of the Producing Lands from which Salt Water will be Produced and Disposed of in the Disposal Well) Grantee shall have no right to dispose of salt water produced from lands other than the Producing Lands. 4. All salt water produced from the Producing Lands shall be disposed of down the Disposal Well in such a manner to preclude contamination of any and all surface and subsurface fresh water, water bearing strata, and water reserves owned by Grantor. Grantee covenants and agree s to take all reasonable and prudent precautions to protect the integrity and purity of Grant or's fresh water reserves and strata. Grantee agrees to indemnify and hold Grantor harmless for any damage, pollution, or impairment of the fresh water strata and reserves occasioned by t he disposal of salt water into the Disposal Well, regardless of any degree of negligence of a ny party, whether by Grantee, Grantor, or a third party. 5. Grantee shall drill a monitoring well at the depth and location specified by Grant or (the "Monitoring Well"). Grantee's cost in drilling the Monitoring Well shall be limited to $____ . Any cost of drilling the Monitoring Well above that amount shall be paid by Grantor. The Monitoring Well shall be accessible to Grantor at all times and shall become the property of Grantor upon the expiration and termination of this Agreement. Failure of Grantee to comm ence the drilling and completion of the Monitoring Well within ____ days of the Effective Date of this Agreement shall constitute an immediate termination of this Agreement and Gra ntee shall have no further rights under this Agreement. 6. The rights of Grantee created by this Agreement are nonexclusive and Grantor expressly reserves the full right and authority to enter into other agreements or grant other ease ments crossing the Land. Grantee shall not, in the drilling and maintenance of the Disposal We ll and Monitoring Well, and operation of the Disposal Well, interfere with operations existing or being conducted, or facilities constructed or being constructed, by other grantees of Grantor of other rights-of-way or easements across the Land. 7. Section corner markers and other survey reference points must be carefully protected from damage during Grantee's operations on the Land. Grantee shall be responsible and liable for the cost of any repairs or replacements of section corner markers or other survey reference points which are necessitated by damage resulting from Grantee's operations. 8. Grantee, by its execution of this Agreement and the drilling and utilization of t he Wells on the Land, agrees to indemnify and hold Grantor harmless from all suits, actions, claims, damages, losses, attorney's fees, and expenses of any kind or character which arise, directly or indirectly, or in any way are connected with Grantee's operations under this Agreement. T his provision includes, but is not limited to, injuries or damages received or sustained by any pe rson, persons, or property, whether on account of any action by Grantee or Grantee's employees, agents, officers, contractors or subcontractors, or contractors and subcontractor's agents or employees. Grantee shall pay any judgment, together with all costs and expenses, which may be obtained against Grantor which will include all reasonable attorney's fees. 9. Grantor shall not be liable or responsible for any damage caused to Grantee's wells by reason of any subsequent construction or farming operations which are authorized or permitted by Grantor on the Land. 10. As an expressed condition of this Agreement, and not as a mere covenant, if Grantee abandons the Disposal Well and Monitoring Well, or the Land ceases to be used for the purposes set forth in this Agreement, for any period of ____ consecutive months or longer, this Agreement shall automatically terminate and all rights of Grantee in this Agreement shall cease and terminate. 11. Grantee shall have the continuing right and option to terminate this Agreement at any time upon delivering Grantor written notice within ____ days of the termination. Should Grantee elect to terminate this Agreement prior to the end of the Term or Sec ond Term, all monies paid by Grantee to Grantor shall be retained by Grantor. 12. Grantor shall have the continuing right to cancel and terminate this Agreement for a ny breach by Grantee of provisions contained in this Agreement. However, this Agreement may not be canceled or terminated by Grantor until Grantor has delivered to Grantee writt en notice of the claimed breach and Grantee has ____ days in which to correct the breach. This right to cancel and terminate this Agreement by Grantor, as provided in this paragraph, shall not apply t o the failure on the part of Grantee to pay monies as provided in paragraphs 1 and 2 of this Agreement. 13. The rights granted by this Agreement shall inure to the benefit of Grantee and shall not be assignable to third parties without the written consent of Grantor, which consent shall not be unreasonably withheld. 14. Upon termination of this Agreement, Grantee shall have the right, for a period of ____ following termination, to remove all of Grantee's surface equipment and fixtures from the Land. If the equipment and fixtures are not removed within the time period provided, they shall become the property of Grantor and the execution of this Agreement by Grantee shall, in such case, be deemed a Bill of Sale as to the equipment and fixtures. In no event shall any ca sing be removed from the Disposal and Monitor Wells by Grantee. 15. All pipelines constructed on the Land shall be buried and shall not be removed after the termination of this Agreement. 16. All written notices required in this Agreement shall be sent to Grantor and Grantee at the addresses set out above, or such other addresses as either party may designate in writing to the attention of the following parties. This Agreement and all its terms and provisions shall be binding on and inure to the benefit of Grantor and Grantee and their respective heirs, personal representatives, successors, and assigns. This Agreement is signed by Grantor and Grantee as of the date of acknowledgment of their signatures, but is deemed effective as of the Effective Date stated above. Grantor Grantee