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HomeMy WebLinkAbout928169 7 r, l/ 000595 RECEIVED 4/6/2007 at 11 :07 AM RECEIVING # 928169 BOOK: 653 PAGE: 595 JEANNE WAGNER LINCOLN COUNTY CLERK, KEMMERER. WY AMENDED AND RESTATED LINE OF CREDIT MORTGAGE, MORTGAGE-SHORT TERM MORTGAGE REDEMPTION, SECURITY AGREEMENT, ASSIGNMENT, FINANCING STATE~NT AND FIXTURE FILING FROM ~DRIKOPOULOS RESOURCES, INC. TO AMERICAN NATIONAL BANK, f/k/a THE BANK OF CHERRY CREEK, N.A., f/k~THE BANK OF CHERRY CREEK (A BRANCH OF WESTERN NATIONAL BANK) THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS. THIS, I~STRUMENT SECURES PAYMENT OF FUTURE ADVANCES. THIS INSTRUMENT COVERS "AS.EXTRACTED COLLATERAL". THE OIL AND GAS INTERESTS INCLUDED IN THE PROPERTY COVERED HEREBY WILL BE FINANCED AT THE WELLHEADS OF THE WELLS LOCATED ON THE PROPERTIES DESCRIBED IN, OR THE DESCRIPTION OF WHICH IS INCORPORATED IN, EXHIBIT "A" ATTACHED HERETO AND MADE A PART HEREOF, AND THIS FINANCING STATEMENT IS TO BE FILED OR FILED FOR RECORD, .AMONG OTHER PLACES, IN THE REAL ESTATE RECORDS PURSUANT TO APP~ICABLE LAW. THOSE PORTIONS OF THE COLLATERAL WHICH ARE MINERALS OR OTHER SUBSTANCES OF VALUE WHICH MAY BE EXTRACTED FROM THE EARTH (INCLUDING, WITHOUT LIMITATION, OIL AND GAS), AND THE ACCOUNTS RELATING THERETO, WILL BE FINANCED AT THE WELLHEADS OF THE WELLS LOCATED ON THE PROPERTIES DESCRIBED IN, OR THE DESCRIPTION OF WHICH IS INCORPORATED IN, EXHIBIT "A". SOME OF THE PERSONAL PROPERTY CONSTITUTING A PORTION OF THE COLLATERAL IS OR IS TO BE AFFIXED TO THE PROPERTIES DESCRIBED IN, OR TtIE DESCRIPTION OF WHICH IS INCORPORATED IN, EXHIBIT nA". MORTGAGOR HAS AN INTEREST OF RECORD IN THE REAL ESTATE CONCERNED, WHICH IS DESCRIBED IN, OR THE DESCRIPTION OF WHICH IS INCORPORATED IN, EXHIBIT nA". A POWER OF SALE HAS BEEN GRANTED IN THIS INSTRUMENT. A POWER OF SALE KAY ALLOW THE MORTGAGEE TO TAKE THE COLLATERAL AND SELL IT WITHOUT GOING TO COURT IN A FORECLOSURE ACTION UPON DEFAULT BY MORTGAGOR HEREUNDER. MORTGAGOR HEREBY AUTHORIZES ANB TO FILE ONE OR MORE FINANCING STATEMENTS COVERING ALL PERSONAL PROPERTY OF MORTGAGOR. THIS INSTRUMENT WAS PREPARED BY AND WHEN RECORDED SHOULD BE RETURNED TO: David G. Stolfa 3300 South Columbine Circle Englewood, Colorado 80113 'O~28169 000596 AMENDED AND RESTATED LINE OF CREDIT MORTGAGE. MORTGAGE-SHORT TERM MORTGAGE REDEMPTION, SECURITY AGREEMENT. ASSIGNMENT, FINANCING STATEMENT AND FIXTURE FILING THIS AMENDED AND RESTATED LINE OF CREDIT MORTGAGE, MORTGAGE-SHORT TERM MORTGAGE REDEMPTION, SECURITY AGREEMENT, ASSIGNMENT, FINANCING STATEMENT AND FIXTURE FILING (this "Instrument"), dated as of February 1, 2007, is from _A.G. ANDRIKOPOULOS RESOURCES, INC., a Wyoming corporation, Wyoming Entity 10'199000261768 ("Mortgagor"), with an address at P.O. Box 788, Cheyenne, Wyoming 82003, to AMERICAN NATIONAL BANK, a national banking association ("ANB"), f/k/a THE BANK OF CHERRY CREEK, N.A., f/k/a THE BANK OF CHERRY CREEK (A BRANCH OF WESTERN NATIONAL BANK), with an address at 3033 East First Avenue, Denver, Colorado 80206. IN CONSIDERATION of the sum of ten dollars ($10.00) in hand paid by ANB to Mortgagor and of the mutual promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: Pursuant to the terms of a letter agreement dated December 14, 2000, as the same may heretofore have been, or may hereafter be, amended, modified, extended or amended and restated from time to time (the "Credit Agreement"), ANB has made available to Mortgagor a revolving line of credit in the aggregate amount of up to $8,000,000. All of the property described under 1 through 8 below is herein collectively called the "Collateral": 1. All of the present right, title and interest of Mortgagor, and any and all additional interests hereafter acquired by Mortgagor (all of the foregoing being herein collectively called the "Interests"), including without limitation the working interests and net revenue interests set forth in Exhibit "A": (a) in and to all of the fee estates, surface estates, easements, rights-of-way, mineral estates, leasehold estates, oil and gas leases, oil, gas and mineral leases, licenses, subleases and sublicenses described or referred to in Exhibit "A" attached hereto and made a part hereof or covering or relating to all or any part of the land described in Exhibit "A" or the description of which is incorporated in Exhibit "A", and (b) in and to any other interests coyering or relating to all or any part of the land described in Exhibit "A" or the description of which is incorporated in Exhibit "A" (the ULand"); 2. All of the oil, gas, casinghead gas, coalbed methane and other hydrocarbons, whether solid, liquid or gaseous, 0928169 00059tî' and all other associated or related substances ("Hydrocarbons") which Mortgagor owns or leases or to which Mortgagor otherwise has rights, whether in, on or attributable to any of the Interests or otherwise, including without limitation all of the severed and extracted Hydrocarbons owned by Mortgagor and any and all "as-extracted collateral" (as defined in the applicable version of the Uniform commercial Code); 3. All of the items incorporated as part of or attributed or affixed to any of the real property included in the Interests; 4. All wells, platforms, derricks, casing, tubing, tanks, tank batteries, separators, dehydrators, compressors, rods, pumps, flow lines, water lines, gas lines, machinery, pipelines, power lines and other goods and equipment, and all other personal property and fixtures, now or hereafter owned, leased or used by Mortgagor whether attributable to or obtained or used in connection with any of the Interests or otherwise, including without limitation any and all such items which are used or purchased for the production, treatment, storage, transportation, manufacture or sale of Hydrocarbons and any and all such items described on Exhibit "A"; 5. All of the inventory, accounts, contract rights, chattel paper, payment intangibles, promissory notes, supporting obligations and general intangibles of Mortgagor, whether heretofore or hereafter arising, whether in connection with the Interests or otherwise, including without limitation those arising under any contract or agreement relating to the exploration for Hydrocarbons, the operation of any property for the production of Hydrocarbons or the treatment, storage, transportation, gathering, handling, processing, manufacture, sale or marketing of Hydrocarbons, including without limitation any of the foregoing described on Exhibit "A" and any and all operating, pooling, commodity hedge, swap, exchange, forward, futures, floor, collar or cap agreements entered into by or on behalf of Mortgagor or to which Mortgagor is a party or has rights; 6. All logs, maps, geologic data, seismic data, gravitational data, magnetic data, other geophysical data, geochemical data, engineering data, formation tests, core samples, drilling reports, division orders, transfer orders, title opinions, reserve reports, lease files, well files and other information, data and records, whether in paper, electronic or any other form, and related computer hardware and software; 7. All of the rights, privileges, benefits, hereditaments and appurtenances in any way belonging, incidental or appertaining to any of the property described under Paragraphs 1 through 6 above; and -2- 0928169 000598 8. All of the proceeds and products of the property described under Paragraphs 1 through 7 above, including without limitation condemnation awards and the proceeds of any and all title insurance policies and other insurance policies covering all or any part of said property and, to the extent they may constitute proceeds, instruments, accounts, chattel paper, payment intangibles, promissory notes, supporting obligations, securities, general intangibles and contract rights. TN CONSIDERATION of the sum of ten dollars ($10.00) in hand paid to Mortgagor, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor hereby: A. Grants, bargains, sells, assigns, transfers, pledges, mortgages and conveys, and grants a security interest in, the Collateral to ANB, WITH POWER OF SALE pursuant to this Instrument and applicable law; TO HAVE AND TO HOLD the Collateral to ANB and its successors and assigns forever, subject to all of the terms, conditions, covenants and agreements herein set forth, for the security and benefit of ANB; and B. Assigns to ANB all of the severed and extracted Hydrocarbons produced from, attributed to or otherwise included in any of the Collateral, together with all amounts that become payable to Mortgagor with respect to any of the Collateral, whether now owned or hereafter acquired, and all of the proceeds thereof. AND in furtherance thereof Mortgagor warrants, represents, covenants and agrees as follows: ARTICLE I Obli~ations Section 1.1 This Instrument is executed, acknowledged and delivered by Mortgagor to secure and enforce the following obligations (herein called the "Obligations"): A. Payment of and performance of all obligations of Mortgagor under or in connection with the Promissory Note dated December 14, 2000, as the same 'may heretofore have been, or may hereafter be, amended, renewed, extended or substituted for (the "Note"), made by Mortgagor, in the face amount of $8,000,000, payable to the order of ANB on or before October 31, 2008 (or such earlier date as may be specified in the Credit Agreement), with interest at the fluctuatiI)g "Prime Rate" (as defined in the Credit Agreement, currently 8.25% per annum) plus: (1) prior to maturity or default, one-half of one percentage point per annum, and (2) after maturity or default, five percentage points per annum; -)- O~281b9 000599 B. All indebtedness, liabilities and obligations of Mortgagor to ANB of every kind and character, now existing or hereafter arising, pursuant to the Credit Agreement; C. All other indebtedness, liabilities and obligations of Mortgagor to ANB, of every kind and character, now existing or hereafter arising, whether direct or indirect, primary or secondary, joint, several or joint and several (including, without limitation, any and all obligations of Mortgagor to ANB for fees, costs and expenses pursuant to or in connection with any loan agreements now or hereafter in force), it being contemplated that Mortgagor may hereafter become indebted to ANB in such further sums; D. Payment of all sums advanced and costs and expenses incurred by ANB (whether directly or indirectly and including without limitation all legal fees) in connection with the obligations described in this Section 1.1 or any part thereof, any renewal, extension or change of or substitution for the obligations described in this Section 1.1 or any part thereof, or the acquisition or perfection of the security therefor, whether such advances, costs and expenses were made or incurred at the request of Mortgagor or ANB; E. Payment of all other indebtedness and liabilities and performance of all other obligations of Mortgagor to ANB arising pursuant to this Instrument or in connection with this Instrument; and F. All renewals, extensions, amendments and changes of, or substitutions or replacements for, all or any part of the items described under A through E above; provided that such renewals, extensions, amendments, changes of, or substitutions or replacements for, all or any part of the foregoing: (1) shall not exceed $15,000,000 in aggregate outstanding principal amount at any time; (2) shall have been made on or before December 31, 2013; and (3) shall completely mature on or before December 31, 2015. section 1.2 The maximum amount of the Obligations that may be outstanding at any time or from time to time that shall be secured by this Instrument, including as a mortgage or as a pledge or assignment of Hydrocarbons, is $15,000,000. ARTICLE II Warranties. Representations and Covenants Section 2.1 Mortgagor warrants, represents and covenants to and with ANB that: (a) Mortgagor has, and will -4- O~'Z81.69 continue to have, the right to receive at all times the "Net Revenue Interest" specified in Exhibit "A" of all Hydrocarbons produced from the wells located on the Collateral; (b) Mortgagor's share of development and operating costs with respect to any of the wells or properties included in the Collateral ,is, and will continue to be, no greater than the "Working Interest" specified in Exhibit "A" for that well or property; provided that the foregoing representation and covenant shall be deemed not to have been violated if, as to any well or property, Mortgagor's share of such costs shall be greater than the "Working Interest" specified but Mortgagor's right to receive Hydrocarbons produced therefrom shall be proportionately increased over the "Net Revenue Interest" specified for such well or property; (c) Mortgagor is, and shall continue to be, the lawful owner of good and defensible title to the Collateral, free and clear of all liens, security interests, encumbrances and burdens, except liens, security interests and other matters permitted by the terms of the Credit Agreement; (d) each loan, the payment of which constitutes an Obligation hereunder, is or shall be for a business or commercial purpose; and (e) Mortgagor will forever defend the title to the Collateral against the claims of all persons whomsoever claiming or to claim the same or any part thereof. OOOGOO Section 2.2 Mortgagor covenants that, so long as any part of the Obligations remains unpaid or unsatisfied, unless ANB shall have otherwise consented in writing: A. Mortgagor shall promptly and, insofar as not contrary to applicable law, at Mortgagor's own expense, file and refile in such offices, at such times and as often as may be necessary, this Instrument and every other instrument in addition or supplemental hereto, including applicable financing statements, as may be necessary to create, perfect, maintain and preserve the lien, encumbrance and security interest intended to be created hereby and the rights and remedies of ANB hereunder: B. Mortgagor shall execute, acknowledge and deliver to ANB such other and further instruments and do such other acts as in the reasonable opinion of ANB may be necessary or desirable to more fully identify and subject to the lien, encumbrance and security interest and assignment created hereby any property intended by the terms hereof to be covered hereby, to assure the first priority thereof, and otherwise to effect the intent of this Instrument, promptly upon request of ANB and at Mortgagor's expense; and C. If the title, interest, lien or encumbrance, as the case may be, of Mortgagor or ANB to the Collateral or any part thereof, or the security of this Instrument, or the rights or powers of ANB hereunder, shall be attacked, either -5- 000601 O~Z8169 directly or indirectly, or if any legal proceedings are commenced involving Mortgagor or the Collateral, Mortgagor shall promptly give written notice thereof to ANB and at Mortgagor's own expense shall take all reasonable steps diligently to defend against any such attack or proceedings; and ANB may take such independent action in connection therewith as it may in its discretion deem advisable, and all costs and expenses, including, without limitation, reasonable attorneys' fees and legal expenses, incurred by ANB in connection therewith shall be a demand obligation owing by Mortgagor to ANB, shall bear interest at the rate provided in the Note, and shall be a part of the Obligations. ARTICLE III Collection of Proceeds of Production Section 3.1 Pursuant to the assignment made by Mortgagor in paragraph B of the granting clause of this Instrument, ANB is entitled to receive all of the severed and extracted Hydrocarbons produced from or attributed to all of the Interests, together with all of the proceeds thereof. Mortgagor acknowledges and agrees that said assignment is intended to be an absolute and unconditional assignment and not merely a pledge of or creation of a security interest therein or assignment as additional security. Mortgagor hereby authorizes and directs all parties producing, purchasing, receiving or having in their possession any such Hydrocarbons or proceeds to treat and regard ANB as the party entitled, in Mortgagor's place and stead, to receive such Hydrocarbons and proceeds; and said parties shall be fully protected in so treating and regarding ANB and shall be under no obligation to see to the application by ANB of any such proceeds received by it. Section 3.2 All of the proceeds received by ANB pursuant to' Section 3.1 shall be applied by ANB in accordance with the terms hereof, of the Credit Agreement and/or of the Note, as applicable. section 3.3 Upon any sale of any of the Collateral by or for the benefit of ANB pursuant to Article V, the Hydrocarbons thereafter produced from or attributed to the part of the Collateral so sold, and the proceeds thereof, shall be included in such sale and shall pass to the purchaser free and clear of the provisions of this Article. section 3.4 ANB is hereby absolved from all liability for failure to enforce collection of any such Hydrocarbons or proceeds and from all other responsibility in connection therewith, except the responsibility to account to Mortgagor for proceeds actually received. -6- O~2816~ 000602 Section 3.5 Mortgagor shall indemnify ANB against all claims, actions, liabilities, judgments, costs, attorneys' fees and other charges of whatsoever kind or nature (herein called "Claims") made against or incurred by ANB as a consequence of the assertion, either bèfore or after the payment in full of the Obligations, that ANB received Hydrocarbons or proceeds pursuant to this Article which were claimed by or due to third persons. ANB shall have the right to employ attorneys and to defend against any Claims, and unless furnished with reasonable indemnity, ANB shall have the right to payor compromise and adjust all Claims. Mortgagor shall indemnify and pay to ANB all such amounts as may be paid in respect thereof or as may be successfully adjudicated against ANB. The liabilities of Mortgagor as set forth in this Section shall survive the termination of this Instrument. Section 3.6 Nothing in this Instrument shall be deemed or construed to create a delegation to or assumption by ANB of the duties and obligations of Mortgagor under any agreement or contract relating to the Collateral or any portion thereof, and all of the parties to any such contract shall continue to look to Mortgagor for performance of all covenants and other obligations and the satisfaction of all representations and warranties of Mortgagor thereunder, notwithstanding the assignment of production and proceeds herein made or the exercise by ANB, prior to foreclosure, of any of its rights hereunder or under applicable law. ARTICLE IV Termination If all of the Obligations of Mortgagor shall be paid or performed in full pursuant to the terms and conditions of this Instrument and the instruments evidencing the Obligations and if ANB has no further obligation to make advances to Mortgagor, then ANB shall, promptly after the request of Mortgagor, execute, acknowledge and deliver to Mortgagor proper instruments evidencing the termination of this Instrument. Mortgagor shall pay all reasonable legal fees and other expenses incurred by ANB for preparing and reviewing such instruments of termination and the execution and delivery thereof, and ANB may require payment of the same prior to delivery of such instruments. Otherwise, this Instrument shall remain and continue in full force and effect. ARTICLE V Default Section 5.1 The occurrence of any "Event of Default" (as described in the Credit Agreement), including -7- O~281{)9 000603 without limitation the expiration of any applicable grace period (an "Event of Default"), shall, automatically or at the option of ANB (as described in the Credit Agreement), make all amounts then remaining unpaid on the Obligations immediately due and payable, and the liens, encumbrances and security interests evidenced or created hereby shall be subject to foreclosure in any manner provided for herein or provided for by law. Section 5.2 Upon the occurrence of any Event of Default, or at any time thereafter, ANB may elect to treat the fixtures included in the Collateral as real property or as personal property or, if so permitted by applicable law, as both, and proceed to exercise such rights as apply to the type of property selected. Section 5.3 Upon the occurrence of any Event of Default, and at all times thereafter, in addition to all other rights and remedies herein conferred, ANB shall have all of the rights and remedies of a mortgagee under a mortgage with respect to all of the Collateral. This Instrument shall be effective as a mortgage, and, upon the occurrence of an Event of Default, may be foreclosed as to any of the Collateral in any manner permitted by applicable law, and any foreclosure suit may be brought by ANB. The provisions set forth in this Section 5.3 shall not in any way limit any other provision of this Instrument. ANB shall, to the extent permitted by applicable law, have the right and power, but not the obligation, to enter upon and take immediate possession of the real property included in the Collateral or any part thereof, to exclude Mortgagor therefrom, to hold, use, operate, manage and control such real property, to make all such repairs, replacements, alterations, additions and improvements to the same as ANB may deem proper, to sell all of the severed and extracted Hydrocarbons included in the same subject to the provisions of Article III, to demand, collect and retain all other earnings, proceeds and other sums due or to become due with respect to such real property, accounting for and applying to the payment of the Obligations only the net earnings arising therefrom after charging against the receipts therefrom all costs, expenses, charges, damages and losses incurred by reason thereof plus interest thereon at an annual rate which equals the default interest rate applicable to the Note, as fully and effectually as if ANB were the absolute owner of such real property and without any liability to Mortgagor in connection therewith. Section 5.4 Upon the occurrence of any Event of Default, or at any time thereafter, ANB, in lieu of or in addition to exercising any other power, right or remedy herein granted or by law or equity conferred, may proceed by an action or actions in equity or at law for the seizure and -8- O~28169 000504 sale of the real property included in the Collateral or any part thereof, for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power, right or remedy herein granted or by law or equity conferred, for the foreclosure or sale of such real property or any part thereof under the judgment orqdecree of any court- of competent jurisdiction, for the appointment of a receiver pending any foreclosure hereunder or the sale of such real property or any part thereof or for the enforcement of any other appropriate equitable or legal remedy. Section 5.5 Upon the occurrence of any Event of Default, or at any time thereafter, in addition to all other powers, rights and remedies herein granted or by law or equity conferred, ANB shall have all of the rights and remedies of an assignee and secured party granted by applicable law, including the Uniform Commercial Code, and shall, to the extent permitted by applicable law, have the right and power, but not the obligation, to take possession of the personal property included in the Collateral, and for that purpose ANB may enter upon any premises on which any or all of such personal property is located and taka possession of and operate such personal property or remove the same therefrom. ANB may require Mortgagor to assemble such personal property and make it available to ANB at a place to be designated by ANB which is reasonably convenient to both parties. The following presumptions shall exist and shall be deemed conclusive with regard to the exercise by ANB of any of its remedies with respect to personal property: (a) If notice is required by applicable law, five days' prior written notice of the time and place of any public sale or of the time after which any private sale or any other intended disposition thereof is to be made shall be reasonable notice to Mortgagor. No such notice is necessary if such property is perishable, threatens to decline speedily in value or is of a type customarily sold on a recognized market. (b) Without in any way limiting the right and authority of ANB to sell or otherwise dispose of Collateral in a commercially reasonable manner, the fOllowing, or any of them, shall be considered commercially reasonable: (1) ANB may hold a public sale of the Collateral in Denver, Colorado, or Houston, Texas, after having provided Mortgagor with five days' notice of such sale and after having published notice of such sale by an advertisement in such publication as may be permitted or required under applicable state law, as ANB determines to be appropriate (which advertisement may be placed in the "classified" section), for a period of not less than five consecutive issues commencing not more than ten days prior to the sale; (2) the Collateral may be sold for cash; and (3) ANB or any other person owning, directly or -9- O~28169 000605 indirectly, any interest in any of the Obligations may be a purchaser at such sale. section 5.6 Upon the occurrence of any Event of Default, or at any time thereafter, ANB may, with respect to all or any p01::tion of the Collateral, subject to any mandatory requirements of applicable law, sell or have sold the real property or interests therein included in the Collateral or any part thereof at one or more sales, as an entirety or in parcels, at such place or places and otherwise in such manner and upon such notice as may be required by law or by this Instrument, or, in the absence of any such requirement, as ANB may deem appropriate. ANB may postpone the sale of such real property or interests therein or any part thereof by public announcement at the time and place of such sale, and from time to time thereafter may further postpone such sale by public announcement made at the time of sale fixed by the preceding postponement. Sale of a part of such real property or interests therein or any defective or irregular sale hereunder will not exhaust the power of sale, and sales may be made from time to time until all such property is sold without defect or irregularity or the obligations are paid in full. ANB shall have the right to appoint one or more attorneys-in-fact to act in conducting the foreclosure sale and executing a deed to the purchaser. It shall not be necessary for any of the Collateral at any such sale to be physically present or constructively in the possession of ANB. Section 5.7 ANB or any other person owning, directly or indirectly, any interest in any of the obligations shall have the right to become the purchaser at any sale made pursuant to the provisions of this Article V and shall have the right to credit upon the amount of the bid made therefor the amount payable to it under or in connection with the Obligations. Recitals contained in any conveyance to any purchaser at any sale made hereunder will conclusively establish the truth and accuracy of the matters therein stated, including without limitation nonpayment of the obligations and advertisement and conduct of such sale in the manner provided herein or provided by law. Mortgagor hereby ratifies and confirms all legal acts that ANB may do in carrying out the provisions of this Instrument. section 5.8 Mortgagor hereby waives and relinquishes, to the maximum extent permitted by law, and subject to any mandatory requirements of applicable law, Mortgagor hereby agrees that Mortgagor shall not at any time hereafter have or assert, any right under any law pertaining to: marshalling, whether of assets or liens, the sale of property in the inverse order of alienation, the exemption of homesteads, the administration of estates of decedents, appraisement, valuation, stay, extension, redemption, -10- ü~28169 000606 subrogation, or abatement, suspension, deferment, diminution or reduction of any of the Obligations (including, without limitation, setoff), now or hereafter in force. Mortgagor expressly agrees that ANB may offer the Collateral as a whole or in such parcels or lots as ANB, in its sole discretion elects, regardless of the manner in which the Collateral may be described. Section 5.9 All costs and expenses (including reasonable attorneys' fees, legal expenses, filing fees, and mortgage, transfer, stamp and other excise taxes) incurred by ANB in perfecting, protecting and enforcing its rights hereunder, whether or not an Event of Default shall have occurred, shall be a demand obligation of Mortgagor to ANB and shall bear interest at the rate provided in the Note, all of which shall be part of the Obligations. Section 5.10 The proceeds of any sale of the Collateral or any part thereof made pursuant to this Article V shall be applied as follows: A. First, to the payment of all costs and expenses incident to the enforcement of this Instrument, including, without limitation, a reasonable compensation to the agents, attorneys and counsel of ANB; B. Second, to the payment or prepayment of the Obligations, in such order as ANB shall elect; and C. Third, the remainder, if any, shall be paid to Mortgagor or such other person or persons as may be entitled thereto by law. section 5.11 Upon any sale made under the powers of sale herein granted and conferred, the receipt of ANB will be sufficient discharge to the purchaser or purchasers at any sale for the purchase money, and such purchaser or purchasers and the heirs, devisees, personal representatives, successors and assigns thereof will not, after paying such purchase money and receiving such receipt of ANB, be obligated to see to the application thereof or be in any way answerable for any loss, misapplication or non-application thereof. ARTICLE VI Miscellaneous provisions Section 6.1 Each and every right, power and remedy hereby granted to ANB shall be cumulative and not exclusive, and each and every right, power and remedy whether specifically hereby granted or otherwise existing may be exercised from time to time and as often and in such order as may be deemed expedient by ANB, and the exercise of any such -11- O~28169 000607 right, power or remedy will not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. All changes to and modifications of this Instrument must be in writing and signed by Mortgagor and ANB. section 6.2 If any provision hereof or of any of the other documents constituting, evidencing or creating all or any part of the Obligations is invalid or unenforceable in any jurisdiction, the other provisions hereof or of said documents shall remain in full force and effect in such jurisdiction and the remaining provisions hereof will be liberally construed in favor of ANB in order to carry out the provisions hereof and of such other documents. The invalidity of any provision of· this Instrument in any jurisdiction will not affect the validity or enforceability of any such provision in any other jurisdiction. section 6.3 This Instrument will be deemed to be and may be enforced from time to time as an assignment, contract, financing statement, real estate mortgage, or security agreement, and from time to time as anyone or more thereof, as is appropriate under applicable state law. section 6.4 Notwithstanding anything to the contrary contained herein, no rate of interest required hereunder or under the obligations shall exceed the maximum legal rate under applicable law, and, in the event any such rate is found to exceed such maximum legal rate, Mortgagor shall be required to pay only such maximum legal rate. Section 6.5 Insofar as permitted by otherwise applicable law, this Instrument and the obligations shall be construed under and governed by the laws of the state of Colorado (excluding choice of law and conflict of law rules) ; provided, however, that, with respect to any portion of the Collateral located outside of the State of Colorado, the laws of the place in which such property is located shall apply to the extent, and only to the extent, necessary to permit ANB to enforce or realize upon its rights and remedies hereunder with respect to such property, and any such enforcement or realization proceedings shall be conducted in compliance with the applicable laws of the state where the Collateral is located. Section 6.6 This instrument may be executed in any number of counterparts, each of which will for all purposes be deemed to be an original, and all of which are identical except that: (a) to facilitate recordation, in particular counterparts hereof, portions of Exhibit "A" hereto which describe properties situated in counties or parishes other than the county or parish in which the counterpart is to be recorded have been omitted, and (b) to -12- ü~28169 000608 accommodate different execution formalities for different states in which the Collateral is located, the signature blocks and title pages in counterparts to be filed in certain states may contain captions, witnesses, acceptances and other formalities not included in other counterparts. Each counterpart shall be deemed to be an original for all purposes, and all counterparts shall together constitute but one and the same instrument. Section 6.7 Unless otherwise specified in Exhibit "A" hereto, all recording references in Exhibit "A" hereto are to the official real property records of the county in which the affected land is located. The references in Exhibit "A" hereto to liens, encumbrances and other burdens shall not be deemed to recognize or create any rights in third parties. Section 6.8 All deliveries and notices hereunder shall be deemed to have been duly made or given if made or given in conformity with the provisions of the Credit Agreement. Section 6.9 This Instrument shall bind and inure to the benefit of the respective successors and assigns of Mortgagor and ANB, including, without limitation, any and all other banks, lending institutions and parties which may participate in the indebtedness evidenced by the Obligations or any of them. Notwithstanding any other provision contained herein, if any property interest granted by this Instrument does not vest on the execution and delivery of this Instrument, it shall vest, if at all, no later than 20 years after the execution and delivery of this Instrument. As used herein, the term "person" shall mean individual, corporation, limited liability company, partnership, joint venture, agency or other form of entity or association. Section 6.10 Some of the above goods are or are to become fixtures on the Land. The above described minerals or other substances of value which may be extracted from the earth (including without limitation oil and gas), and the accounts relating thereto will be financed at the wellhead of the well or wells located on the Land. This Instrument is to be filed for record in, among other places, the real estate records of each county in which the affected real estate is located; to wit, all of those listed in Exhibit "A." Mortgagor is the owner of a record interest in a portion of the real estate concerned. The mailing address of Mortgagor and the address of ANB from which information concerning the security interest may be obtained are as set forth above. Section 6.11 ANB shall be entitled to enforce payment of any indebtedness and performance of any other of the Obligations secured hereby and to exercise all rights and -13- O~281b9 000609 powers under this Instrument or under any other instrument or other agreement or any laws now or hereafter in force, notwithstanding the fact that some or all of said indebtedness and other obligations secured hereby may now or hereafter be otherwise secured, whether by mortgage, deed of trust, pledge, lien, assignment or otherwise. Neither the acceptance of this Instrument nor its enforcement, whether by court action or pursuant to the power of sale or other powers herein contained shall prejudice or in any manner affect ANB's right to realize upon or enforce any other security now or hereafter held by ANB, it being agreed that ANB shall be entitled to enforce this Instrument and any other security now or hereafter held by ANB in such order and manner as it may in its absolute discretion determine. section 6.12 certain obligations of Mortgagor to ANB secured hereby have previously been secured by certain prior mortgages, security documents, assignments thereof and amendments thereto (the "Prior Security Documents"), filed and recorded as described in Schedule I attached hereto and made a part hereof (or filed and recorded as described in any of said documents or in any predecessor document described as being amended and/or restated thereby or by any such predecessor document). It is the desire and intention of the parties hereto to renew and extend all liens, rights, powers, privileges, superior titles, estates and security interests in the properties and interests described in Exhibit "A" hereto existing by virtue of any of the Prior Security Documents (the "Previously Mortgaged Properties"). In connection therewith, it is understood and agreed that this Instrument restates and supersedes the Prior Security Documents in their entirety, insofar as the Prior Security Documents cover any of the Previously Mortgaged Properties and assets, property, rights and interests relating thereto. In addition to creating the liens, rights, powers, privileges, superior titles, estates and security interests in and to the Collateral as described herein, this Instrument renews and extends all liens, rights, powers, privileges, superior titles, estates and security interests existing in the Previously Mortgaged Properties by virtue of any of the Prior Security Documents, but the terms, provisions and conditions of such liens, powers, privileges, superior titles, estates and security interests shall hereafter be governed and controlled in all respects by this Instrument and any amendments or supplements hereto. section 6.13 As to that portion of the Collateral situated in the State of North Dakota, the parties agree that the terms of the North Dakota Short-term Redemption Act shall govern this Instrument. As to that portion of the Collateral situated in the State of North Dakota, ANB (or any successor to ANB as mortgagee hereunder) has the right to proceed to -14- O~2816S 000610 obtain and collect a deficiency judgment, together with foreclosure of the real property mortgaged under the applicable laws of the state of North Dakota. EXECUTED as of the date first above written. By RESOURCES, INC. :--\-- AMERICAN NATIONAL BANK, f/k/a THE BANK OF CHERRY REEK, N.A., f/k/a THE BANK 0 ERRY CREEK (A BRANCH OF W S ~TIONAL BANK) By: STATE OF Y:5olYlíJ":2 COUNTY OF l-ð::U-;:::¡n'l í c:; ) ) S5. ) (Colorado, North Dakota, Utah, Wyoming) / ~. The foregoing instrument was acknowledged before me ~I?day of JY)~rc-1C ,2007, by A. G. Andrikopoulos, as President of A.G. ANDRIKOPOULOS RESOURCES, INC., a Wyoming corporation, on behalf of said corporation. witness my hand official seal. this and (New Mexico) This instrument was acknowledged before me on /J.'}c:;;Jrek If- , 2007, by A. G. Andrikopoulos, as President of A.G. ANDRIKOPOULOS RESOURCES, INC., a Wyoming corporation, on behalf of said corporation. Given under my hand and official seal. STATE OF WYOMING . =r5~~ KJ:=~LLY ôH¡pp ,Nota Public (Name Printed) ( SEAL) Residing at:::¡.::o ]:Sox 788 Ù~r:IÜ1:.e.. 'v:J 89003 - " 7 g'f{ My commission expires: 10 -j ,20 Dt -15- O~28169 000611 STATE OF COLORADO ss. CITY AND COUNTY OF DENVER (Colorado, North Dakota, Utah, Wyoming) The foregoing instrument was acknowledged before me this --2- day of MARCH , 2007, by Gary w. Vick, as Senior Vice President of AMERICAN NATIONAL BANK, a national banking association, f/k/a THE BANK OF CHERRY CREEK, N.A., f/k/a THE BANK OF CHERRY CREEK (A BRANCH OF WESTERN NATIONAL BANK), on behalf of said national banking association. witness my hand and official seal. (New Mexico) DEBORAH SMITH NOTARY PUBLIC iTATE OF COLORADO This instrument was acknowledged before me on MARCH 9 , 2007, by Gary W. Vick, as Senior Vice President of AMERICAN NATIONAL BANK, a national banking association, f/k/a THE BANK OF CHERRY CREEK, N.A., f/k/a THE BANK OF CHERRY CREEK (A BRANCH OF WESTERN NATIONAL BANK), on behalf of said national banking association. Given under my hand and official seal. ~IO~ ~¡1 ~ DEBORAH SMITH , tary Public (Name Printed)ArnerIoan Nattcma1 BanIt Residing at :·:··~~-åoss Eas~ Flr.<;t Avrm..7 / þøn\fijf, Ow t) ;):tJ'!}!i ' \ . ~.. 3/7.Q , 20-LQ 'Ay CaIIII1ission Expiea (SEAL) My commission expires: -16- ...,r~Q'tb9 O~jWJc:J 000612 SCHEDULE I PRIOR SECURITY DOCUMENTS 1. The November 15, 1991 Mortgage, Security Agreement, Assignment and Financing Statement was filed and recorded as follows: State Filing Reoording Data County Date Book Paqe Moffat 03/06/92 649 127 Campbell 03/16/92 1181 Photos 360 Crook 03/10/92 308 Photos 676 Johnson 03/09/92 251 65 Sweetwater 03/10/92 824 390 Colorado wyoming Wyoming Wyoming Wyoming 2. The May 1, 1995 Mortgage, Deed of Trust, Assignment of Production, Security Agreement and Financing statement was filed and recorded as follows: Filing Reoording Data state County Date Book Paqe New Mexico Rio Arriba 07/17/95 193 151 Utah Uintah 05/31/95 596 652 Wyoming Campbell 05/30/95 13 37 Photos 64 Wyoming Lincoln 05/30/95 368 PR 599 Wyoming Sweetwater 05/30/95 863 770 3. The December 14, 2000 Amended and Restated Mortgage, Security Agreement, Assignment, Financing Statement and Fixture Filing was filed and recorded as follows: Filing Recording Data state County Date Book Paqe Colorado Moffat 03/09/01 Doc. #2001L 1001 New Mexico Eddy 03/29/01 410 283 New Mexico Rio Arriba 03/22/01 344 138 Utah Uintah 03/28/01 755 323 Wyoming Campbell 03/08/01 1650 Photos 527 Wyoming Campbell 05/14/01 1664 Photos 637 Wyoming Crook 03/08/01 381 Photos 524 Wyoming Johnson 03/08/01 284 682 Wyoming Lincoln 03/19/01 461 170 Wyoming Sweetwater 03/09/01 933 1350 1-1 O~ZS16S 00061.3 SCHEDULE I (CONT.) 4. The December 20, 2002 Mortgage-Short Term Mortgage Redemption, Security Agreement, Assignment, Financing Statement and Fixture Filing was filed and recorded as follows: State County Filing Date Recording Data Book Paqe Colorado Moffat 01/21/03 Doc. #2003L 360 5. The October 31, 2003 Mortgage-Short Term Mortgage Redemption, Security Agreement, Assignment, Financing Statement and Fixture Filing was filed and recorded as follows: state Filing Recording Data County Date Book Paqe Moffat 11/21/03 #2003-L-5907 Lea 11/21/03 1267 784 Billings 11/24/03 95 Mtgs. 243 Duchesne 11/25/03 . M302 584 Campbell 12/12/03 1933 Photos 83 Carbon 11/24/03 1049 213 Park 12/01/03 Recep. #2003-11406 Sweetwater 12/09/03 990 967 Colorado New Mexico N. Dakota Utah wyoming Wyoming Wyoming Wyoming 1-2 Ü~2S1.69 000614 PREAMBLE TO EXHIBIT "A" 1. Well names, unit designations, unit tract descriptions and descriptions of undivided leasehold interests, Net Revenue Interests and Working Interests contained in Exhibit "A" shall not be deemed to limit the interests covered hereby. 2. Reference is made to the land descriptions contained in the documents of title recorded as described in Exhibit "A". To the extent that any land description in Exhibit "A" is incorrect or not legally sufficient, the land descriptions contained in the leases or .other documents recorded as described in Exhibit "A" are incorporated herein by this reference. 3. Unless provided otherwise, all recording references in Exhibit "A" are to the official real property records of the county or counties in which the Interests are located and in which records such documents are or in the past have been customarily recorded, whether Deed Records, Oil and Gas Records, Oil and Gas Lease Records or other records. 4. Unless marked with a percentage symbol (%), the "Working Interests" ("WI") and "Net Revenue Interests" ("NRI") described in Exhibit "A" are expressed in decimal equivalents, e.g., 1.00 = 100 percent. A-i O~Z8169 Exhibit "A" to that certain Mortgage-Short Term Mortgage Redemption, SecuQP06j.5 Agreement, Assignment, Financing Statement and Fixture Filing from A. G. Andrikopoulos Resources, Inc. to American National Banle Lease Name: Lease Description: Lease Interest: Subject Wells: . Lincoln County, Wyoming Schedule W-42289 T. 25 N..R. 112 W.. 6th P.M. Section 23: All Section 24: W /2 Containing 960.00 Gross and Net Acres Lincoln County, Wyoming 4.75% Overriding Royalty Interest West Swan #23-1 West Swan #23-2 West Swan #23-3 West Sw:an #23-4 West Swan #23-5 . . West Swan #23-6 West Swan #7-26D West Swan #24-2X West Swan #24-3R West Swan #24-9 (9.351835% Paliic. Factor) West Swan #24-12 West Swan #24-14 West Swan Unit (18.306217% Partie. Factor) Lease Name: W-57878 .. -- . ili Lease Descnptlûn: T. 25 N.. R. III W.. 6 P.M. Section 30: Lots 7 thru 10 (fka Lots 1,2, E/2NW/4) Containing 158.61 Gross and Net Acres Lincoln County, Wyoming 3.9296875% Overriding Royalty Interest West Swan #24-9 (9.295724% Partie. Factor) West Swan Unit (18.19638% Partie. Factor) Lease Interest: Subject Wells: O~28'169 Lease Name: Lease Description: Lease Interest: Subject Wells: 00061G W-88014 T. 25 N., R. 111 W., 6th P.M. Section 30: Lots 13, 14, 19,20 (fka SE/4) Section 31: Lots 1,2,7,9,12,13,18,19 (fka Lots 1,2, E/2NW/4, SE/4) Section 32: Lots 3-6, 9, 10, 15, 16 (fka NW/4, SE/4) Containing 800.01 Gross and Net Acres Lincoln County, Wyoming 3.9296875% Overriding Royalty Interest West Swan #30-3 (50% Partie. Factor) West Swan #30-4 (50% Partie. Factor) West Swan #30-5 (50% Partie. Factor) West Swan #30-6 (50% Partie. Factor) West Swan #30-8 (50% Partie. Factor) West Swan #30-9 (50% Partie. Factor) West Swan #30-11 (50% Partie. Factor) West Swan #31-1 #1 (50% Partie. Factor) West Swan #31-4 (50% Partie. Factor) West Swan #31-6 (50% Partie. Factor) West Swan B #32-1 (50% Partie. Factor) West Swan #32-2 #2 (50% Partie. Factor) West Swan #32-3 (50% Partie. Factor) West Swan #32-4 (50% Partie. Factor) West Swan #32-5 (50% Partie. Factor) West Swan #32-6 (50% Partie. Factor) Reservoir Unit 65-1