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Exhibit 99.1
LEASE AGREEMENT
This Agreement made and entered into this 13th day of July,
2007, by and between
SOVEREIGN OIL, Inc. ("SOVEREIGN OIL"), a Nevada corporation, and
NORTH AMERICAN
REFINING CO. ("NORTH AMERICAN") (hereinafter referred to
collectively as
"parties").
IT IS HEREBY AGREED:
1. TERM: The term of this Agreement shall commence from the date
of the
execution of this Agreement by both parties to and including
January 8, 2008.
("Lease Period").
2. TERMS OF PAYMENT/LEASE VALUE AND CONSIDERATION: SOVEREIGN OIL
shall pay NORTH
AMERICAN the following:
Lease Payment: $10.00 for the Lease Period, and
Blending and Drying fees: blending fees at $0.15 per gallon and
drying fees at
$0.15 per gallon. No minimum fees required under this Lease.
in consideration for use of the following located at 7601 West
47th Street,
McCook, Illinois 60525 ("Premises"): a) the "blending building"
and associated
equipment b) associated loading dock, and c) use of up to twenty
(20) storage
tanks for the blending based on availability of oils and d)
equipment associated
with the items above based on availability (a-d collectively
referred to as the
"Leased Premises"). It is agreed that SOVEREIGN OIL will also
retain the right
to use other incidentals associated with its business, such as
occasional use of
the truck scale for weighing of loaded trucks, associated pumps
for storage
tanks, and entry to the site for loading or unloading of
materials, entry/exit
of work force, and /or servicing of equipment.
SOVEREIGN OIL's payment terms are cash or good Company Check,
with the Lease
Payment being due upon the execution of this agreement to cover
the Lease Period
and blending and drying fees are due and payable monthly on the
tenth day
following the last day of each month for the previous month's
activity.
All blending and drying fees shall remain at the set price
during the duration
of this Agreement, unless otherwise agreed upon by both parties
in writing,
and/or in the event that SOVEREIGN OIL requests additional
storage, or site
usage above and beyond that specified within said Agreement.
Should SOVEREIGN
OIL request additional site space, NORTH AMERICAN has agreed to
make every
effort possible to provide additional space within reason.
3. LICENSES: Both parties shall maintain all licenses and
permits as required
for their separate businesses.
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4. WARRANTIES/RETENTION OF OWNERSHIP: SOVEREIGN OIL represents
and warrants that
it shall comply with applicable laws and regulations regarding
any business
conducted at the Premises, and NORTH AMERICAN represents and
warrants that the
ownership of all equipment and/or product kept at the Premises
by SOVEREIGN OIL
shall be retained by SOVEREIGN OIL. SOVEREIGN OIL is responsible
for all product
loading and unloading in an environmentally sound and safe
manner.
5. TERMINATION OF AGREEMENT: NORTH AMERICAN shall have the right
to terminate
this Agreement with 15 days written notice.
6. FORCE MAJEURE: Neither SOVEREIGN OIL nor NORTH AMERICAN shall
be
construed to be in default of this Agreement to the extent
either party fails to
perform its obligations or duties due to forces beyond its
control, including
but not limited to, acts of nature, floods, fire, explosions,
strikes or other
labor disturbances, failure in, or inability to obtain on
reasonable terms raw
materials, finis
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