Minutes of Houston Oil Company of Texas

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16 The stock transfer books of the Company shall be closed 15 days before each regular meeting of the stockholders and all persons who are stockholders as shown by the books of the Company at the time when so closed shall be entitled to vote at such meeting.

17- All stockholders of record ten days prior to the time any dividend may be declared shall be entitled to the dividend so declared.

18- It shall be the duty of the President to preside at all meetings of the Board of Directors - to sign all certificates of stock, deeds conveyances - Bonds, notes and contracts of the Company except where otherwise directed by these By-Laws - or by action of the Board of Directors. He shall have the general supervision and control of the affairs of the Company and be the executive head of the Company under the direction of the Board of Directors until the General Manager of the Company has been selected the President shall have the power to appoint such assistants - subordinate officers and employees of the Company as from time to time in his judgement may be necessary to properly conduct and carry on the business of the Company - and to remove or discharge same from such employment when in his judgement it shall be for the interest of the Company to do so.

19 In the absence or inability of the President to act or in case of vacancy in the office of the President - the First Vice President shall have all the authority and power conferred upon the President herein and shall perform the duties imposed upon the President herein - and in the event of the absence or inability of both President and First Vice President to act - or a vacancy in both the said offices - then the Second Vice President shall that same power

20 The Secretary and Auditor and the Treasurer and General Manager of the Company shall have such power and authority - and perform such duties as may hereafter be conferred upon them or required of them by the Board of Directors by resolution duly enacted.

21 The By-laws of this Company may be amended - altered or appealed at any regular or special meeting of the Board of Directors provided ten days notice of said meeting and of the proposed amendment - alteration or appeal shall be given to each member of the Board of Directors. Said notice shall be given by mail by letter addressed to the last known Post office address of each Director.

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22 The seal of the Company shall be in circular form with a star in the center and an outer and inner circle with the words Houston Oil Company of Texas in outer circle and the words Incorporated 1901 in the inner circle as follows.

[SEAL]

Therefrom the Board being duly organized for business the following proceedings were had.

The resignation of Mr. O.C. Drew as Director weas received and accpeted and On motion duly seconded Mr Tho[ma]s H. Franklin was elected to fill said vacancy.

On motion duly seconded Mr Tho[ma]s H. Franklin was unanimously elected President of the Company

On motion duly seconded Mr. Finis E. Marshall was unanimously elected First Vice President of the Company

On motion duly seconded Mr. F.A. Helbig? was unanimously elected Secretary and Auditor of the Company

On motion duly seconded Mr. O.C. Drew was unanimously elected Treasurer of the Company

The President then submitted the following proposition of Mr John H. Kirby:

Proposition of John H. Kirby to the President and Directors of the Houston Oil Company of Texas.

Houston, Tx July 5th 1901 Gentlemen: I hereby offer and propose to sell and convey or cause to be conveyed and sold within a period of 140 days from and after the date of your acceptance of this proposition to the Houston Oil Company of Texas all the oil land and properties mentioned and specified in the schedule hereto attached marked Exhibit "A" except such portions thereof as may be rejected by the Houston Oil Company of Texas becuase the title thereto shall be found unsatisfactory by the opinion of your attorneys - for the sum and price of Twenty Millions dollars in your common stock - full paid and non-assessable - subject however to the payment by you of the respective amounts in cash due or that shall become due as the purchase price of the several properties mentioned in said schedule marked Exhibit "A" - not exceeding in the aggregate the sume of $17,500,000.00 and which indebetness you are to assume and pay - provided however that the total of said Twenty Million Dollars of common stock is not to be delivered by you to me until I have made or cause to be made to your proper conveyance of the

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total of the properties embraced in the attached schedule marked Exibit "A" but further provided that you are from time to time to make delivery to me of such proportions of said Twenty Million Dollars of common stock as the several said properties I shall convey or cause to be conveyed to you as aforesaid from time to time may bear to the total in value of the properties mentioned in said schedule marked Exhibit "A"

And as a further consideration to you for your accepting and carrying out the terms and conditions herein proposed by me. I hereby further propose to and do hereby assign to you all and every right or option in and about all that certain list of property mentioned in the schedule hereto attached and marked Exhibit "B" without however any guaranty upon my part of any value in such rights or without any guaranty upon my part that the persons, firms or corporation interested in said properties embraced therein upon your tendering to him it or them the purchase price thereof according to my said rights or options will make conveyance of said properties - but I do hereby bind and obligate myself to use earnest endeavor to cause the persons, firms and corporations mentioned in said Exhibit "B" within the limit of time within which I hereby agree to convey or caused to be conveyed to you the properties set out in said Exhibit "A" attached heretoupon your payment or tender of payment of the consideration therefor to convey to you the properties set out in said Exhibit "B" It shall however be expressly understood that I hereby reserve from the properties mentioned in both Exhibit "A" and Exhibit "B" each and every of the lumber mills to the number of about sixteen situated on said properties - together with stocks of lumber on hand at the present day and at the date of delivery to you of said properties and any and all team [wads] and all other appurtenances and sufficient land upon which the said mills are located for the purposes of their business and with the right of access to the same - all of which is hereby expressly excepted from this proposal and reserved to myself in the schedule hereto attached.

As I understand you will desire to dispose at once of the pine timber upon these lands as set out in the annexed contract marked Exhibit "C" I hereby offer to purchase such timber upon the land to the amount of (8,000,000,000) Eight billion feet and to pay therefor the aggregate sum of Thirty eight million two hundred and fifty thousand ($ 38,250,000.00) Dollars in semi-annual installments under the terms of the contract the form of which is herewith submitted attached hereto and marked Exhibit "C".

This contract if made by you with me I propose to assign to the Kirby Lumber Company, a corporation to be organized under the Laws of the State of Texas which Company will undertake the full performance of the contract on my part.

With respect to the financial responsibility of the Kirby Lumber Company and its ability to perform the contract - I have to say that it is to be organized with a cash working capital of Two Million five hundred thousand ($2,500.000.00) dollars that it will have no mortgage or other debts and that in addition to its cash capital stated above it will own sixteen lumber mills well located in the heart of the pine forests of Eastern Texas with stocks of lumber train roads and other appurtentances and with a manufacturing capacity of Two hundred million (200.000.000) feet per annum the present cash value of these mills with property and appurtenances as above is upwards of three million ($3.000.000.00) dollars and their aggregate earnings amount to upwards of $740.000 per annum. For the purpose of increasing the manufacturing capacity of this company to the amount of 350.000.000 feet per annum it will forthwith proceed to build five additional mills with a capacity of 150.000.000 feet per annum.

Respectfully submitted (Signed) John H. Kirby