This Lease and Agreement, made and entered into, in duplicate, this 10th day of May, in the year A. D. 1905, by and between Alfred Benton and Jane Benton, his wife, of the County of Santa Barbara, State of California, the parties of the first part, and Blue Bird Oil Company, a corporation, organized and existing under the laws of the State of California, and having its principal place of business at Los Angeles, Los Angeles County, California, the party of the second part:

Witnesseth, That for and in consideration of the rents and royalties to be paid by party of the second part to parties of the first part hereinafter specified, and of the covenants, agreements and stipulations by said party of the second part hereinafter undertaken to be done and performed, the said parties of the first part do hereby grant, lease, demise and let unto the party of the second part, its successors and assigns, for the term and time and for the purposes, and under and in accordance with the stipulations, agreements and conditions herein set forth, the following described lands, situate in the County of Santa Barbara, State of California, bounded and described as follows, to-wit:

(Description.)

Together with the exclusive right to operate, mine, tunnel and drill for, and to otherwise develop, collect and obtain crude petroleum oil, as-phaltum, maltha, tar, gas, and any and all other hydro-carbon substances in, upon and under said lands; together with the right to take, remove, hold, own, market and otherwise to use, enjoy and dispose of all of said petroleum oil and any and all of said other substances which may be produced and saved by party of the second part, out of, from and away from said lands, subject to the payment of the rents and royalties herein provided.

Together with the right and privilege at any and all times, during the continuance of this contract, to enter and travel in, upon and over any and all portions of said demised premises, and thereon to build, erect, hold, operate, maintain and enjoy any and all necessary or convenient roads, derricks, rigs, boilers, engines, machinery, pumping stations and plants, jacks, boarding houses, bunk houses, stables, pipe-lines, tanks, telephone lines, and any and all other means, appliances, machinery and structures, proper or convenient for use in connection with the development, collection, storage and transportation of any and all of said hydrocarbon substances.

Together also with the right, at any and all times, during the continuance of this contract, to take, develop and use any and all water on said demised premises that may be necessary or convenient for operating machinery and for domestic and stock purposes and uses in connection with the operations of party of the second part under this contract, and for use in sinking and drilling wells and driving tunnels and making excavations on and in said lands, and otherwise in connection with operating for and developing, removing and marketing said oil and said other substances on, in and from said demised premises.

To Have and to Hold the premises hereinabove described, and all and singular said rights, privileges, interests and easements herein granted, unto the said party of the second part, its successors and assigns, for and during the time and periods and subject to all the terms, conditions, stipulations and agreements herein specially set forth.

And it is expressly understood and agreed that, subject to the rights, privileges and easements herein granted exclusively to said party of the second part, the said parties of the first part are to retain the use and possession of the lands and premises hereby demised, during said term, for all purposes that they may desire which are not inconsistent with the exclusive rights, privileges and easements hereby granted to the said party of the second part.

1st. The party of the second part agrees that it will within sixty days from the date hereof commence operations on said lands, and that it shall and will sink or drill wells on said premises at the rate of four (4) wells per year for the period of ten (io) years from and after the date hereof; provided, that the party of the second part shall be able to sink as many as four wells per year on said lands by the diligent and continuous operation of two strings of drilling tools thereon; it being understood that if four wells cannot be sunk on said lands in any year by the diligent and continuous operation of two strings of drilling tools, the obligation of the party of the second part in this behalf shall nevertheless be considered to have been, and shall be, fully performed for such year if two strings of drilling tools shall have been diligently and continuously operated on said premises during such year.

2nd. It is further understood and agreed, however, that the foregoing agreement fixes only the minimum number of wells to be sunk or the minimum number of strings of tools to be operated, and that party of the second part may sink in any year in said term of ten years, and in the aggregate during said term, as many wells hereunder as it sees fit, there being no maximum limit fixed to the number of wells to be sunk hereunder during said term of ten years; and that in case party of the second part in any of said years shall sink a well or wells on said lands in excess of said number of four wells required to be sunk in each year, then the well or wells so sunk in excess of said required yearly number, shall be applied on the wells required to be sunk hereunder thereafter, in such manner and for such year or years as the said party of the second part shall elect.

3rd. It is further understood and agreed that if the party of the second part shall fail for any one year to sink the said required number of wells for that year, or to operate continuously and diligently during the same with two strings of tools as herein expressed and stated, the party of the second part shall forfeit all rights under this grant to drill or sink upon said lands other wells than those already completed as herein defined, or on which work is being done in good faith at the time of such forfeiture, and shall also forfeit the right to begin any new tunnels, excavations or other works thereon. It being particularly understood and agreed, however, that said party of the second part shall not be bound to carry on said work of drilling wells on Sundays, or on legal holidays, or at night when by reason of excessive gas, or otherwise, it is unsafe to drill at night, or when prevented by the weather, strikes, unavoidable shortage of water, accidents or other unavoidable causes, and that the failure of party of the second part, at any time, to diligently and continuously operate two strings of tools shall be deemed to be excused, and shall be excused, if such failure occurs by reason of any of the causes or reasons above named, and by such failure to operate party of the second part shall neither forfeit nor lose any of its rights hereunder.